UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended March 31, 2004.
[ ] Transition report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the transition period from to .
---------- ------------
Commission file number: I-9418
------
AXIA GROUP INC.
(Exact name of small business issuer as specified in its charter)
Nevada 87-0509512
-------- ------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
268 West 400 South, Salt Lake City, Utah 84101
------------------------------------------ ------------
(Address of principal executive office) (Zip Code)
(801) 575-8073
(Issuer's telephone number)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes XX No
-- ----
The number of outstanding shares of the issuer's common stock, $0.001 par value
, as of May 17, 2004 was 2,753,766, outstanding shares of the issuer's preferred
stock, $0.001 par value, as of May 17, 2004, was 1,000.
1
TABLE OF CONTENTS
PART I
ITEM 1. FINANCIAL STATEMENTS..................................................3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS..................................4
ITEM 3. CONTROLS AND PROCEDURES ..............................................5
PART II
ITEM 1. LEGAL PROCEEDINGS.....................................................5
ITEM 2. RECENT SALES OF UNREGISTERED SECURITIES...............................5
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.......................................6
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...................6
ITEM 5. OTHER INFORMATION.....................................................6
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K......................................6
SIGNATURES.....................................................................6
INDEX TO EXHIBITS..............................................................7
2
ITEM 1. FINANCIAL STATEMENTS
As used herein, the term "Axia" or the "Company" refers to Axia Group, Inc., a
Nevada corporation, and predecessors unless otherwise indicated. Audited balance
sheets for Axia as of December 31, 2003, as well as unaudited, interim financial
statements including balance sheets as of March 31, 2004 , and statements of
operations, and statements of cash flows for the interim period of three months
up to the date of such balance sheet and the comparable periods of the preceding
year are attached hereto as Pages F-1 through F-7 and are incorporated herein by
this reference.
3
ITEM 1. FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS (Unaudited)
PAGE
Balance Sheets...............................................................F-2
Statements of Operations.....................................................F-4
Statements of Stockholders' Deficit..........................................F-5
Statements of Cash Flows.....................................................F-7
Notes to Financial Statements................................................F-9
THIS SPACE HAS BEEN
INTENTIONALLY LEFT BLANK
F-1
AXIA GROUP, INC.
(A Development Stage Company)
BALANCE SHEETS
(Unaudited)
ASSETS
------
March 31, December
2004 31, 2003
---------------- ----------------
CURRENT ASSETS
Cash $ 1,856 $ -
Other receivables 450 -
Total Current Assets 2,306 -
---------------- ----------------
FIXED ASSETS
Property, net 959 999
---------------- ----------------
TOTAL ASSETS $ 3,265 $ 999
================ ================
The accompanying notes are an integral part of these financial statements
F-2
AXIA GROUP, INC.
(A Development Stage Company)
BALANCE SHEETS (Continued)
(Unaudited)
March 31, December 31,
2004 2003
---------------- ----------------
Current Liabilities
Accounts payable $ 30,106 $ 47,563
Utah State Tax Commission liability 36,248 35,914
IL EPA liability 237,043 234,864
Other payables 1,500 36,688
Related party payable, net (Note 3) - 21,452
---------------- ----------------
Total Current Liabilities 304,897 376,484
---------------- ----------------
TOTAL LIABILITIES 304,897 376,484
---------------- ----------------
SERIES A REDEEMABLE CONVERTIBLE PREFERRED
STOCK, $001 PAR VALUE, 50,000,000 SHARES
AUTHORIZED, 1,000 SHARES ISSUED AND
OUTSTANDING 5,000 5,000
---------------- ----------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $.001 par value,
1,000,000,000 shares authorized,
2,504,266 and 2,404,266 shares issued
and outstanding , respectively 2,504 2,404
Additional paid in capital 18,623,689 18,475,909
Treasury stock, 1,107 shares at cost (3,202) (3,202)
Stock subscription receivable (45,000) (45,000)
Deferred consulting fee (10,000) -
Deficit accumulated prior to the
development stage (17,995,776) (17,995,776)
Deficit accumulated during the
development stage (878,847) (814,820)
---------------- ----------------
Total Stockholders' Equity (Deficit) (306,632) (380,485)
---------------- ----------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) $ 3,265 $ 999
================ ================
The accompanying notes are an integral part of these financial statements
F-3
AXIA GROUP, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
From Inception of
Development Stage
Three Months Ended on January 1,
March 31, 2004 2003 through
------------------------------------ March 31
2004 2003 2004
--------------- -------------- -----------------
REVENUE $ - $ - $ -
EXPENSES
Selling, general &
administrative
expenses 64,027 43,450 885,347
--------------- -------------- -----------------
Total Expenses $ 64,027 $ 43,450 $ 885,347
--------------- -------------- -----------------
LOSS FROM OPERATIONS (64,027) (43,450) (885,347)
--------------- -------------- -----------------
OTHER INCOME (EXPENSE)
Interest Expense - (2,977) -
Other income - - 6,500
--------------- -------------- -----------------
Total Other Income
(Expense) - (2,977) 6,500
--------------- -------------- -----------------
NET LOSS $ (64,027) $ (46,427) $ (878,847)
=============== ============== =================
NET LOSS PER SHARE $ (0.03) $ (0.12)
=============== ==============
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING 2,448,967 378,785
=============== ==============
The accompanying notes are an integral part of these financial statements
F-4
AXIA GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Stockholders' Deficit
Additional Stock
Common Stock Paid-in Treasury Subscription Deferred Accumulated
Shares Amount Capital Stock Receivable Consulting Deficit
------------ ---------- ------------ ------------ ------------ ---------- --------------
Balance, December 31, 2002 379,892 $ 380 $ 17,882,021 $ (3,202) $ (135,000) $ (51,333) $ (17,995,776)
Amortization of deferred
consulting expense - - - - - 12,833 -
Common stock issued to
officers and directors
for services rendered 1,066,667 1,067 638,93 - - (77,00) -
Fractional share adjustment
for reverse stock split (716) (1) 1 - - - -
Return and cancellation of
shares issued for deferred
consulting (11,667) (12) (38,488) - - 38,500 -
Return and cancellation of
shares issued to officer as
collateral for loan guarantee (52,351) (52) (408,281) - - - -
Contributed capital - - 428,333 - - - -
Return and cancellation of
common shares issued for a
stock subscription (16,667) (17) (89,983) - 90,000 - -
Issuance of common shares
for cash 1,039,108 1,039 63,374 - - - -
Net loss for the year ended
December 31, 2003 - - - - - - (814,820)
------------ --------- ------------ ------------ ------------ ---------- --------------
Balance, December 31, 2003 2,404,266 $ 2,404 $ 18,475,909 $ (3,202) $ (45,000) $ - $ (18,810,596)
------------ --------- ------------ ------------ ------------ ---------- --------------
The accompanying notes are an integral part of these financial statements.
F-5
AXIA GROUP, INC.
(A DEVELOPMENT STAGE COMPANY)
Statements of Stockholders' Deficit (Continued)
Additional Stock
Common Stock Paid-in Treasury Subscription Deferred Accumulated
Shares Amount Capital Stock Receivable Consulting Deficit
------------ --------- ----------- ------------ ------------ ---------- --------------
Balance, December 31, 2003 2,404,266 $ 2,404 $18,475,909 $ (3,202) $ (45,000) $ - $ (18,810,596)
Transfer of zero-basis stock
in settlement of obligations
(Unaudited) - - 124,880 - - (10,000) -
Issuance of shares for service
(Unaudited) 100,000 100 22,900 - - - -
Net loss for the quarter ended
March 31, 2004 (Unaudited) - - - - - - (64,027)
------------ --------- ----------- ------------ ------------ ---------- --------------
Balance, March 31, 2004
(Unaudited) 2,504,266 $ 2,504 $18,623,689 $ (3,202) $ (45,000) $ (10,000) $ (18,874,623)
============ ========= =========== ============ ============ ========== ==============
Accumulated deficit prior to the development stage $ (17,995,776)
Accumulated deficit during the development stage (878,847)
--------------
Accumulated deficit $ (18,874,623)
==============
The accompanying notes are an integral part of these financial statements.
F-6
AXIA GROUP, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
From Inception of
Development Stage
on January 1, 2003
Three Months Ended through
March 31 March 31, 2004
-------------------------------
2004 2003
-------------- ------------- ------------------
Cash Flows From
Operating Activities
Net loss $ (64,027) $ (46,427) $ (878,847)
Adjustments to reconcile
net loss to net cash used
in operating activities:
Services rendered in lieu
of payment of related party - - 53,254
receivables
Allowance for bad debts - - (33,254)
Depreciation and amortization 40 40 200
Issued common stock and stock
options for services 23,000 - 663,000
Amortization of deferred
consulting - 19,250 12,833
Changes in operating assets
and liabilities:
(Increase) decrease other
assets - 96 96
Increase (decrease) in
accounts payable (17,456) 2,727 (10,512)
Increase in accrued and
other liabilities 330 2,976 38,255
Increase in Illinois EPA
liability 2,179 - 13,081
Increase in refundable
deposit (450) - (450)
Increase in related party
payable 58,240 21,243 79,692
-------------- ------------- ------------------
Net Cash Provided by
(Used In) Operating
Activities 1,856 (95) (62,652)
-------------- -------------- ------------------
Cash Flows From Investing
Activities $ - $ - $ -
-------------- -------------- ------------------
The accompanying notes are an integral part of these financial statements.
F-7
AXIA GROUP, INC.
(A Development Stage Company)
Statements of Cash Flows (Continued)
From Inception of
Three Months Ended Development Stage
March 31 on January 1, 2003
--------------------------- through
2004 2003 March 31, 2004
------------ ------------ -------------------
CASH FLOWS FROM FINANCING
ACTIVITIES
Common stock issued
for cash $ - $ - $ 64,413
------------ ------------ -------------------
Net Cash Provided By
Financing Activities - - 64,413
------------ ------------ -------------------
Net Increase (Decreased)
In Cash 1,856 (95) 1,761
CASH, BEGINNING OF YEAR - 95 95
------------ ------------ -------------------
CASH, END OF YEAR $ 1,856 $ - $ 1,856
============ ============ ===================
SUPPLEMENTAL DISCLOSURE OF
INFORMATION
Cash paid during the year for
interest $ - $ - $ -
Cash paid during the year for
income taxes $ - $ - $ -
SUPPLEMENTAL DISCLOSURE OF NON-
CASH INVESTING AND FINANCING
ACTIVITIES
Common stock and options issued
for services $ 23,000 $ 640,000 $ 663,000
Return and cancellation of
common stock issued for
deferred consulting $ - $ 38,500 $ 38,500
Collectibility of debt
formerly written off $ - $ (428,333) $ (428,333)
Return and cancellation of
common stock issued as
collateral for deferred
consulting $ - $ 408,281 $ 408,281
Return and cancellation of
common stock issued for a
subscription receivable $ - $ 90,000 $ 90,000
The accompanying notes are an integral part of these financial statements.
F-8
AXIA GROUP, INC.
(A Development Stage Company)
Notes to Financial Statements
March 31, 2004 and December 31, 2003
NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION
The accompanying unaudited financial statements have been prepared by
the Company pursuant to the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles in the United States of
America have been condensed or omitted in accordance with such rules
and regulations. The information furnished in the interim financial
statements include normal recurring adjustments and reflects all
adjustments, which, in the opinion of management, are necessary for a
fair presentation of such financial statements. Although management
believes the disclosures and information presented are adequate to
make the information not misleading, it is suggested that these
interim financial statements be read in conjunction with the
Company's most recent audited financial statements and notes thereto
included in its December 31, 2003 Annual Report on Form 10-KSB.
Operating results for the three months ended March 31, 2004 are not
indicative of the results that may be expected for the year ending
December 31, 2004.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using accounting
principles generally accepted in the United Stated of America
applicable to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of
business. The Company has incurred cumulative operating losses through
March 31, 2004 of $18,874,623, and has a working capital deficit of
$302,591 at March 31, 2004 all of which raise substantial doubt about
the Company's ability to continue as a going concern.
There can be no assurance that the Company can or will be successful
in implementing any of its plans or that they will be successful in
enabling the company to continue as a going concern. The Company's
financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
NOTE 3 - RELATED PARTY TRANSACTION
During the first quarter of 2004 the Company transferred 9,100,012
common shares of Nexia Holdings, Inc. to Hudson Consulting Group, Inc.
in full extinguishment of all amounts owed to Hudson and/or Nexia
(Hudson consolidates into Nexia) including a consulting agreement with
Hudson that expires in May 2004. Accordingly, $10,000 has been
recognized as deferred consulting at March 31, 2004 to be expensed in
subsequent period. Because the Company and Hudson are related parties
through common management, no gain was recognized on the
extinguishment of debt. Instead, the debt extinguishment increased the
Company's additional paid-in capital by $124,880.
F-9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Forward Looking Statements
--------------------------
The information herein contains certain forward looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended and Section 21E of the Securities Exchange Act of 1934, as
amended, which are intended to be covered by the safe harbors
created thereby. Investors are cautioned that all forward looking
statements involve risks and uncertainty, including, without
limitation, the ability of Axia to continue its expansion strategy,
changes in the real estate markets, labor and employee benefits, as
well as general market conditions, competition, and pricing.
Although Axia believes that the assumptions underlying the forward
looking statements contained herein are reasonable, any of the
assumptions could be inaccurate, and therefore, there can be no
assurance that the forward looking statements included in the Form
10-QSB will prove to be accurate. In view of the significant
uncertainties inherent in the forward looking statements included
herein, the inclusion of such information should not be regarded as
a representation by Axia or any other person that the objectives and
plans of Axia will be achieved.
General
-------
Axia was a holding company that operated in two primary areas of
business: acquiring, leasing and selling real estate; and, providing
financial consulting services. These operations were spun-off in
December of 2002 and Axia has no current operations.
Capital Resources and Liquidity
-------------------------------
Axia is a development stage company and has no meaningful capital
resources.
Impact of Inflation
-------------------
Axia believes that inflation has had a negligible effect on
operations over the past three years.
Plan of Operations
------------------
Axia has no plans for the purchase of any plant or equipment.
As of January 1, 2003, the Company has reverted back to the
development stage and currently has no employees. Axia has no
current plans to make any changes in the number of employees and
does not anticipate doing so until it acquires a business or an
interest in an operation company.
Axia does not expect to generate any meaningful revenue or incur
operating expenses unless and until it acquires an interest in an
operating company.
Axia's plan of operation for the coming year is to identify and
acquire a favorable business opportunity. Axia does not plan to
limit its options to any particular industry, but will evaluate
each opportunity on its merits. Axia has reviewed and evaluated a
number of business ventures for possible acquisition or
participation by Axia. Axia does not have any commitment or
understanding to enter into or become engaged in a transaction as of
the date of this filing. Axia continues to investigate, review, and
evaluate
4
business opportunities as they become available and will seek to
acquire or become engaged in business opportunities at such time
as specific opportunities warrant. Axia anticipates that its owners,
affiliates, and consultants will provide it with sufficient capital
to continue operations until the end of the year 2003, but there can
be no assurance that this expectation will be fully realized.
ITEM 3. CONTROLS AND PROCEDURES
Axia's president acts both as the Company's chief executive officer
and chief financial officer ("Certifying Officer") and is
responsible for establishing and maintaining disclosure controls and
procedures for the Company. The Certifying Officer has concluded
(based on his evaluation of these controls and procedures as of a
date within 90 days of the filing of this report) that the design
and operation of the Company's disclosure controls and procedures
(as defined in Rule 13a-14(C)) under the Securities Exchange Act of
1934) are effective. No significant changes were made in the
Company's internal controls or in other factors that could
significantly affect those controls subsequent to the date of the
evaluation, including any corrective actions with regard to slight
deficiencies and material weaknesses. Due to the Certifying
Officer's dual role as chief executive officer and chief financial
officer, the Company has no segregation of duties related to
internal controls.
PART II
ITEM 1. LEGAL PROCEEDINGS
During the first quarter of 2004, no material developments occurred
regarding Axia's legal proceedings. For more information please see
Axia's Form 10-KSB for the year ended December 31, 2003.
ITEM 2. CHANGES IN SECURITIES
On February 20, 2004, the Company issued 100,000 shares of common
stock to David L. Kagel, an attorney. The shares were issued
pursuant to the S-8 Registration Statement of the Company in payment
of a Fee Agreement for services rendered.
Subsequent Events
-----------------
On April 2, 2004 pursuant to three separate settlement agreements
the Company issued 111,000 shares of its common stock to Amos
Varsha, 55,000 shares of common stock to William Roper and 33,500
shares of common stock to Anita Lea Reinharz. Each of these persons
was a cash investor in the Company. All claims of the three named
persons were settled and released in exchange for the shares issued
to them. The Company issued the shares pursuant to section 4(2) of
the Securities Act of 1933 in an isolated private transaction by the
Company which did not involve a public offering.
On April 27, 2004 the Company authorized the issuance of 50,000
shares its restricted common stock to Elias Roussos to settle any
and all claims that Mr. Roussos held against the company. The
Company issued the shares pursuant to section 4(2) of the Securities
Act of 1933 in an isolated private transaction by the Company which
did not involve a public offering.
5
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
On April 2, 2004 the Company approved the settlement of all claims
held by Barry M. Burbank in exchange for transferring to Mr. Burbank
500,000 shares of the common stock of Nexia Holdings, Inc. The
shares of Nexia were investment shares held by the Company.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. Exhibits required to be attached by Item 601 of Regulation
---------
S-B are listed in the Index to Exhibits on page 7 of this Form
10-QSB, and are incorporated herein by this reference.
(b) Reports on Form 8-K. The Company filed the following reports on Form
--------------------
8-K during the quarter for which this report is filed.
None
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, there unto duly
authorized, this 20th day of May 2004.
Axia Group, Inc.
/s/ Richrd D. Surber
-------------------------------
Richard D. Surber,
President, Chief Executive and Financial Officer and Director
6
INDEX TO EXHIBITS
EXHIBIT PAGE DESCRIPTION
NO. NO.
- --- ---
3(i) * Articles of Incorporation of the Company (note that
these were amended by the Articles of Merger
constituting Exhibit 2 to this Form 10-KSB)
(incorporated herein by reference from Exhibit No.
3(i) to the Company's Form 10-KSB for the year ended
December 31, 1993).
3(ii) * Bylaws of the Company, as amended (incorporated
herein by reference from Exhibit 3(ii) of the
Company's Form 10 KSB for the year ended December 31,
1995).
3(iii) * Certificate of Determination of the Rights and
Preferences of Preferred Stock by Axia for 5,000,000
shares of preferred stock out of the 20,000,000
authorized (incorporated herein by reference from a
Form 8-K filed on August 24, 2001).
3(iv) * Restatement of the Articles of Incorporation for the
Company, they will provide for specific authority
for the Board of Directors of Axia to carry out
forward and reverse splits of all classes of Axia's
common shares. (Incorporated herein by reference from
a Form 14C filed on March 21, 2003)
Material
- --------
Contracts
- ---------
10(i)(p) * Assignment and Release, dated January 23, 2004, of
all claims with Nexia Holdings, Inc., Wasatch
Capital, Inc., Hudson Consulting Group, Inc. and West
Jordan Real Estate Holdings, Inc. (Incorporated
herein by reference from the 10- KSB of the Company
filed on April 15, 2004).
10(i)(q) 12 Settlement Agreement and Release of all claims of
Barry M. Burbank against Axia Group, Inc. in exchange
for the delivery of 500,000 shares of Nexia Holdings,
Inc. common stock.
10(i)(r) 14 Settlement Agreement and Release of all claims of
Anita Lea Reinharz against Axia Group, Inc. in
exchange for the delivery of 33,500 shares of the
Company's common stock.
10(i)(s) 16 Settlement Agreement and Release of all claims of
William Roper against Axia Group, Inc. in exchange
for the delivery of 55,000 shares of the Company's
common stock.
10(i)(t) 18 Settlement Agreement and Release of all claims of
Amos Varsha against Axia Group, Inc. in exchange of
the delivery of 111,000 shares of the Company's
common stock.
7
31(i) 9 Certification Pursuant to 18 U.S.C.ss.1350, as
adopted pursuant toss.302 of the Sarbanes-Oxley Act
of 2002
32(i) 10 Certification Pursuant to 18 U.S.C.ss. 1350, as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
* Previously filed as indicated and incorporated herein by reference from the
referenced filings previously made by the Company.
8
Exhibit 32(I)
CERTIFICATION PURSUANT TO
18 U.S.C. ss. 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Axia Group, Inc. (the
"Company") on Form 10-QSB for the period ending March 31, 2004, as
filed with the Securities and Exchange Commission on the date hereof
(the "Report"), I, Richard Surber, Chief Executive and Financial
Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that, to the best of my knowledge and belief:
(1) the Report fully complies with the requirements of Section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) the information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations
of the Company.
A signed original of this written statement required by Section 906 has been
provided to Axia Group, Inc. and will be retained by the Company and furnished
to the Securities and Exchange Commission or its staff upon request.
Richard Surber
------------------------------------
Chief Executive and Financial Officer
May , 2004
9
Exhibit 31(I)
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Richard Surber, certify that:
1. I have reviewed this quarterly Report on Form 10-QSB of Axia Group, Inc.
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. I am responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
registrant and have:
(a) Designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly report
is being prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting
principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
(d) Presented in this quarterly report my conclusions about the
effectiveness of the disclosure controls and procedures based on my
evaluation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to
record, process, summarize and report financial data and have
identified for the registrant's auditors any material weaknesses in
internal controls; and
(b) Any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's
internal controls; and
Date: May , 2004 By: /s/ Richard Surber
Richard Surber, the president, CEO
and CFO of Axia Group, Inc.
10
Exhibit 10(i)(q)
SETTLEMENT AGREEMENT
AND
RELEASE
This Settlement Agreement and Release (the "Agreement") is entered into
as of the day of March, 2004, by and between Barry M. Burbank, an individual
("Burbank") and Nexia Holdings, Inc., a Nevada corporation and Axia Group, Inc.,
a Nevada corporation, hereinafter jointly referred to as "Nexia".
RECITALS
A. WHEREAS, Burbank held 10,000 shares of the common stock of Axia
Group, Inc. on the record date to receive a dividend of 26 shares of Nexia
Holdings, Inc. common stock for each share of Axia Group, Inc. owned by him on
that date: and
B. WHEREAS, Burbank has alleged that such shares were never delivered
nor received by him nor by any third-party for his benefit and as such the
parties may have unresolved claims and charges against each; and.
C. WHEREAS, the parties desire in exchange for the releases and
promised delivery designated herein to release and discharge any and claims that
exist between the parties hereto and to resolve all disputes outstanding between
them without the necessity of legal action;
NOW THEREFORE, in consideration of the mutual covenants contained
herein which are acknowledge to be good and valuable consideration the parties
agree as follows:
1. Nexia shall deliver to Burbank 500,000 shares of Nexia
Holdings, Inc. common stock, from the shares held by Axia
Group, Inc. as undeliverable or unknown addresses.
2. Nexia shall authorize the transfer and/or the release of any
and all legends or restrictions to such shares upon receipt of
a proper request from Burbank, including an appropriate legal
opinion that the shares should not bear a restrictive legend.
3. Burbank and Nexia shall each release and discharge the other
parties from any and all charges, claims and rights that were
asserted or could have been asserted as to the other party
upon the execution and performance provided for herein.
4. Except as expressly set forth in this agreement, the parties
hereby release, acquit and forever discharge each other, their
present and former officers, directors, members, employees,
affiliates, owners, partners, attorneys, agents, successors
and assigns, of and from any and all claims, demands,
promises, costs, damages, expenses and/or causes of action of
any nature whatsoever, which exist or may exist, as of the
date of this agreement, including, but not limited to, those
claims which are made or could be made in a legal action,
whether known or unknown, liquidated or contingent. In this
regard, the parties acknowledge and represent that
11
they have made their own investigation with respect to the
claims involved in any prior dealings and the advisability of
settlement and that they have not relied upon any
representations of any other party to this agreement in
agreeing to settlement of the all claims and the mutual
release contained herein.
5. The parties acknowledge and agree that this agreement is
entered into in settlement and compromise of disputed or
potential claims and shall not constitute an admission of any
evidence of wrongdoing by any party and that each party denies
any liability to any other party to this agreement.
6. Should legal action be necessary to enforce, construe,
rescind, terminate or recover for the breach of the provisions
of this agreement, the prevailing part or parties shall be
entitled to recover all costs of suit, including reasonable
attorney's fees.
7. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Utah.
8. The individuals signing this Agreement warrant that they have
full authority to bind their principals as parties to this
Agreement.
IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement as of the date first above written.
BARRY M BURBANK NEXIA HOLDINGS, INC.
/s/ Barry M. Burbank By: /s/ Richard Surber
-------------------- -------------------
Title: President
AXIA GROUP, INC.
By: /s/ Richard Surber
Title: President
12
Exhibit 10(i)(r)
SETTLEMENT AGREEMENT
AND
RELEASE
This Settlement Agreement and Release (the "Agreement") is entered into
as of the day of April, 2004, by and between Anita Lea Reinharz, an individual
("Reinharz") and Axia Group, Inc., a Nevada corporation, ("Nexia").
RECITALS
A. WHEREAS, Reinharz delivered to Axia a total of $2,775 as an
investment in the company: and
B. WHEREAS, Reinharz has alleged that shares of Axia common stock were
never delivered nor received by her nor by any third-party for her benefit and
as such the parties may have unresolved claims and charges against each; and.
C. WHEREAS, the parties desire in exchange for the releases and
promised delivery designated herein to release and discharge any and all claims
that exist between the parties hereto and to resolve all disputes outstanding
between them without the necessity of legal action;
NOW THEREFORE, in consideration of the mutual covenants contained
herein which are acknowledge to be good and valuable consideration the parties
agree as follows:
1. Axia shall deliver to Reinharz 33,500 shares of Axia Group,
Inc. common stock, (the "Shares").
2. Reinharz and Axia shall each release and discharge the other
parties from any and all charges, claims and rights that were
asserted or could have been asserted as to the other party
upon the execution and performance provided for herein.
3. Except as expressly set forth in this agreement, the parties
hereby release, acquit and forever discharge each other, their
present and former officers, directors, members, employees,
affiliates, owners, partners, attorneys, agents, successors
and assigns, of and from any and all claims, demands,
promises, costs, damages, expenses and/or causes of action of
any nature whatsoever, which exist or may exist, as of the
date of this agreement, including, but not limited to, those
claims which are made or could be made in a legal action,
whether known or unknown, liquidated or contingent. In this
regard, the parties acknowledge and represent that they have
made their own investigation with respect to the claims
involved in any prior dealings and the advisability of
settlement and that they have not relied upon any
representations of any other party to this agreement in
agreeing to settlement of the all claims and the mutual
release contained herein.
4. Reinharz has such knowledge and expertise in financial and
business matters that she is capable of evaluating the merits
and substantial risks of the acceptance of the Shares and is
able to bear the economic risks relevant to the acceptance of
the Shares hereunder and has received all information
regarding Axia that she has requested and believes relevant to
making an informed decision to acquire the Shares, including
but not limited to filings by Axia with the Securities and
Exchange Commission.
13
5. Reinharz had individual gross income (exclusive of any income
attributable to her spouse) of more than $200,000 in each of
the most recent two tax years and she reasonably expects to
have an individual gross income of excess of $200,000 for the
current tax year. Reinharz is a sophisticated investor with
experience in business and investment matters. Reinharz's
investment in the Shares does not exceed 10% of her net worth.
6. Reinharz is relying solely upon independent consultation with
her professional, legal, tax, accounting and such other
advisors as Reinharz deems to be appropriate in acquiring the
Shares; Reinharz has been advised to and is hereby again
advised to, and has consulted with, her professional tax and
legal advisors with respect to any tax consequences of
acquiring the Shares.
7. The parties acknowledge and agree that this agreement is
entered into in settlement and compromise of disputed or
potential claims and shall not constitute an admission of any
evidence of wrongdoing by any party and that each party denies
any liability to any other party to this agreement.
8. Reinharz understands that Axia is relying upon Reinharz's
representations and warranties as contained in this Agreement
in consummating the acquisition of the Shares and the
settlement of claims as set forth herein.
9. Should legal action be necessary to enforce, construe,
rescind, terminate or recover for the breach of the provisions
of this agreement, the prevailing part or parties shall be
entitled to recover all costs of suit, including reasonable
attorney's fees.
10. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Utah.
11. The individuals signing this Agreement warrant that they have
full authority to bind their principals as parties to this
Agreement.
IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement as of the date first above written.
ANITA LEA REINHARZ AXIA GROUP, INC.
/s/ Anita Lea Reinharz By: /s/ Richard Surber
Title: President
14
Exhibit 10(i)(s)
SETTLEMENT AGREEMENT
AND
RELEASE
This Settlement Agreement and Release (the "Agreement") is entered into
as of the day of April, 2004, by and between William Roper, an individual
("Roper") and Axia Group, Inc., a Nevada corporation, ("Nexia").
RECITALS
A. WHEREAS, Roper delivered to Axia a total of $5,500 as an investment
in the company: and
B. WHEREAS, Roper has alleged that shares of Axia common stock were
never delivered nor received by him nor by any third-party for his benefit and
as such the parties may have unresolved claims and charges against each; and.
C. WHEREAS, the parties desire in exchange for the releases and
promised delivery designated herein to release and discharge any and all claims
that exist between the parties hereto and to resolve all disputes outstanding
between them without the necessity of legal action;
NOW THEREFORE, in consideration of the mutual covenants contained
herein which are acknowledge to be good and valuable consideration the parties
agree as follows:
1. Axia shall deliver to Roper 55,000 shares of Axia Group, Inc.
common stock, (the "Shares").
2. Roper and Axia shall each release and discharge the other
parties from any and all charges, claims and rights that were
asserted or could have been asserted as to the other party
upon the execution and performance provided for herein.
3. Except as expressly set forth in this agreement, the parties
hereby release, acquit and forever discharge each other, their
present and former officers, directors, members, employees,
affiliates, owners, partners, attorneys, agents, successors
and assigns, of and from any and all claims, demands,
promises, costs, damages, expenses and/or causes of action of
any nature whatsoever, which exist or may exist, as of the
date of this agreement, including, but not limited to, those
claims which are made or could be made in a legal action,
whether known or unknown, liquidated or contingent. In this
regard, the parties acknowledge and represent that they have
made their own investigation with respect to the claims
involved in any prior dealings and the advisability of
settlement and that they have not relied upon any
representations of any other party to this agreement in
agreeing to settlement of the all claims and the mutual
release contained herein.
4. Roper has such knowledge and expertise in financial and
business matters that he is capable of evaluating the merits
and substantial risks of the acceptance of the Shares and is
able to bear the economic risks relevant to the acceptance of
the Shares hereunder and has received all information
regarding Axia that he has requested and believes relevant to
making an informed decision to acquire the Shares, including
but not limited to filings by Axia with the Securities and
Exchange Commission.
15
5. Roper had individual gross income (exclusive of any income
attributable to his spouse) of more than $200,000 in each of
the most recent two tax years and he reasonably expects to
have an individual gross income of excess of $200,000 for the
current tax year. Roper is a sophisticated investor with
experience in business and investment matters. Roper's
investment in the Shares does not exceed 10% of his net worth.
6. Roper is relying solely upon independent consultation with his
professional, legal, tax, accounting and such other advisors
as Roper deems to be appropriate in acquiring the Shares;
Roper has been advised to and is hereby again advised to, and
has consulted with, his professional tax and legal advisors
with respect to any tax consequences of acquiring the Shares.
7. The parties acknowledge and agree that this agreement is
entered into in settlement and compromise of disputed or
potential claims and shall not constitute an admission of any
evidence of wrongdoing by any party and that each party denies
any liability to any other party to this agreement.
8. Roper understands that Axia is relying upon Roper's
representations and warranties as contained in this Agreement
in consummating the acquisition of the Shares and the
settlement of claims as set forth herein.
9. Should legal action be necessary to enforce, construe,
rescind, terminate or recover for the breach of the provisions
of this agreement, the prevailing part or parties shall be
entitled to recover all costs of suit, including reasonable
attorney's fees.
10. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Utah.
11. The individuals signing this Agreement warrant that they have
full authority to bind their principals as parties to this
Agreement.
IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement as of the date first above written.
WILLIAM ROPER AXIA GROUP, INC.
/s/ William Roper By: /s/ Richard Surber
Title: President
16
Exhibit 10(i)(s)
SETTLEMENT AGREEMENT
AND
RELEASE
This Settlement Agreement and Release (the "Agreement") is entered into
as of the day of April, 2004, by and between Amos Varsha, an individual
("Varsha") and Axia Group, Inc., a Nevada corporation, ("Nexia").
RECITALS
A. WHEREAS, Varsha delivered to Axia a total of $11,100 as an
investment in the company: and
B. WHEREAS, Varsha has alleged that shares of Axia common stock were
never delivered nor received by him nor by any third-party for his benefit and
as such the parties may have unresolved claims and charges against each; and.
C. WHEREAS, the parties desire in exchange for the releases and
promised delivery designated herein to release and discharge any and all claims
that exist between the parties hereto and to resolve all disputes outstanding
between them without the necessity of legal action;
NOW THEREFORE, in consideration of the mutual covenants contained
herein which are acknowledge to be good and valuable consideration the parties
agree as follows:
1. Axia shall deliver to Varsha 111,000 shares of Axia Group,
Inc. common stock, (the "Shares").
2. Varsha and Axia shall each release and discharge the other
parties from any and all charges, claims and rights that were
asserted or could have been asserted as to the other party
upon the execution and performance provided for herein.
3. Except as expressly set forth in this agreement, the parties
hereby release, acquit and forever discharge each other, their
present and former officers, directors, members, employees,
affiliates, owners, partners, attorneys, agents, successors
and assigns, of and from any and all claims, demands,
promises, costs, damages, expenses and/or causes of action of
any nature whatsoever, which exist or may exist, as of the
date of this agreement, including, but not limited to, those
claims which are made or could be made in a legal action,
whether known or unknown, liquidated or contingent. In this
regard, the parties acknowledge and represent that they have
made their own investigation with respect to the claims
involved in any prior dealings and the advisability of
settlement and that they have not relied upon any
representations of any other party to this agreement in
agreeing to settlement of the all claims and the mutual
release contained herein.
4. Varsha has such knowledge and expertise in financial and
business matters that he is capable of evaluating the merits
and substantial risks of the acceptance of the Shares and is
able to bear the economic risks relevant to the acceptance of
the Shares hereunder and has received all information
regarding Axia that he has requested and believes relevant to
making an informed decision to acquire the Shares, including
but not limited to filings by Axia with the Securities and
Exchange Commission.
17
5. Varsha had individual gross income (exclusive of any income
attributable to his spouse) of more than $200,000 in each of
the most recent two tax years and he reasonably expects to
have an individual gross income of excess of $200,000 for the
current tax year. Varsha is a sophisticated investor with
experience in business and investment matters. Varsha's
investment in the Shares does not exceed 10% of his net worth.
6. Varsha is relying solely upon independent consultation with
his professional, legal, tax, accounting and such other
advisors as Varsha deems to be appropriate in acquiring the
Shares; Varsha has been advised to and is hereby again advised
to, and has consulted with, his professional tax and legal
advisors with respect to any tax consequences of acquiring the
Shares.
7. The parties acknowledge and agree that this agreement is
entered into in settlement and compromise of disputed or
potential claims and shall not constitute an admission of any
evidence of wrongdoing by any party and that each party denies
any liability to any other party to this agreement.
8. Varsha understands that Axia is relying upon Varsha's
representations and warranties as contained in this Agreement
in consummating the acquisition of the Shares and the
settlement of claims as set forth herein.
9. Should legal action be necessary to enforce, construe,
rescind, terminate or recover for the breach of the provisions
of this agreement, the prevailing part or parties shall be
entitled to recover all costs of suit, including reasonable
attorney's fees.
10. This Agreement shall be governed by and construed in
accordance with the Laws of the State of Utah.
11. The individuals signing this Agreement warrant that they have
full authority to bind their principals as parties to this
Agreement.
IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement as of the date first above written.
AMOS VARSHA AXIA GROUP, INC.
/s/ Amos Varsha By: /s/ Richard Surber
Title: President
18