-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KoEPfTXJhcOmBzy7Y2Syu/KPDs7oLQ9NkilfuPiWlzzjjm0bywHFRR3MlSs1QQrw AEzBOGcPqpTkpaZpp6smBA== 0001010549-05-000574.txt : 20050816 0001010549-05-000574.hdr.sgml : 20050816 20050816131102 ACCESSION NUMBER: 0001010549-05-000574 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20050630 FILED AS OF DATE: 20050816 DATE AS OF CHANGE: 20050816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: XERION ECOSOLUTIONS GROUP INC CENTRAL INDEX KEY: 0001000686 STANDARD INDUSTRIAL CLASSIFICATION: METAL MINING [1000] IRS NUMBER: 841286065 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-26760 FILM NUMBER: 051029995 BUSINESS ADDRESS: STREET 1: SUITE 905, 102-4369 MAIN STREET CITY: WHISTLER STATE: A1 ZIP: V0N 1B4 BUSINESS PHONE: 604-902-0178 MAIL ADDRESS: STREET 1: SUITE 905, 102-4369 MAIN STREET CITY: WHISTLER STATE: A1 ZIP: V0N 1B4 FORMER COMPANY: FORMER CONFORMED NAME: IMMULABS CORP DATE OF NAME CHANGE: 20001031 FORMER COMPANY: FORMER CONFORMED NAME: NORTH AMERICAN RESORTS INC DATE OF NAME CHANGE: 19950915 10QSB 1 xerion10qsb063005.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-QSB (Mark one) X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE - ------- ACT OF 1934 (Fee required) For the quarterly period ended June 30, 2005 or TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT OF 1934 - ------- For the transition period from ______________ to _____________ Commission File Number: 0-26760 XERION ECOSOLUTIONS GROUP INC. Colorado 84-1286065 - -------------------------- ------------------------- (State of incorporation) (IRS Employer ID Number) Suite 905, 102-4369 Main Street Whistler, BC Canada V0N 1B4 -------------------------------------------------------- (Address of principal executive offices) (604) 902 0178 (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 X NO State the number of shares outstanding of each of the issuer's classes of common equity as of the latest practicable date: August 15, 2005 2,841,523 shares. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding filings of the Company at http://www.sec.gov. Transitional Small Business Disclosure Format (check one): YES NO X TABLE OF CONTENTS ITEM NUMBER PAGE PART 1 - FINANCIAL INFORMATION 1. Financial Statements 1 2. Management's Discussion and Analysis or Plan of Operation 9 3. Controls and Procedures 10 PART 2 - OTHER INFORMATION 1. Legal Proceedings 10 2. Changes In Securities 11 3. Defaults Upon Senior Securities 11 4. Submission of Matters to a Vote of Security 11 5. Other Information 11 6. Exhibits and Reports on Form 8-K 11 Signatures 11 2
PART 1 - FINANCIAL INFORMATION Item 1 - Financial Statements Xerion EcoSolutions Group Inc. (A Development Stage Company) Balance Sheets (expressed in U.S. Dollars) As at As at June 30, December 31, 2005 2004 $ $ (unaudited) (audited) ASSETS Current Assets Cash 11,577 2,333 ----------- ----------- Total Current Assets 11,577 2,333 Property and Equipment (Note 3) 3,367 4,836 - ------------------------------------------------------------------------------------------ Total Assets 14,944 7,169 ========================================================================================== LIABILITIES AND STOCKHOLDERS' DEFICIT Current Liabilities Accounts payable (Note 4(b)) 178,966 142,553 Accrued liabilities 1,500 4,942 Due to related party (Note 4(c)) 13,234 -- - ------------------------------------------------------------------------------------------ Total Liabilities 193,700 147,495 - ------------------------------------------------------------------------------------------ Stockholders' Deficit Preferred stock, 50,000,000 shares authorized, no par value; none issued -- -- Common Stock, 300,000,000 shares authorized, $0.001 par value 2,841,523 shares issued and outstanding 2,842 2,842 Additional Paid-in Capital 10,014,413 10,014,413 Donated Capital 126,000 126,000 Deficit Accumulated During the Development Stage (10,322,011) (10,283,581) - ------------------------------------------------------------------------------------------ Total Stockholders' Deficit (178,756) (140,326) - ------------------------------------------------------------------------------------------ Total Liabilities and Stockholders' Deficit 14,944 7,169 ==========================================================================================
(The accompanying notes are an integral part of the financial statements) 3
Xerion EcoSolutions Group Inc. (A Development Stage Company) Statements of Operations (expressed in U.S. Dollars) (unaudited) Accumulated from For the For the November 1, 1985 Three Months Six Months (Date of Inception) Ended Ended to June 30, June 30, June 30, 2005 2005 2004 2005 2004 $ $ $ $ $ Revenue -- -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------ Expenses Depreciation 10,820 752 810 1,469 1,617 General and administrative (1) (Note 4(a)) 3,021,014 18,898 20,543 36,961 57,205 Impairment loss on intangible asset 20,000 -- -- -- -- Loss on disposal of property and equipment 7,866 -- -- -- -- Mining exploration 54,379 -- -- -- -- Stock-based compensation 1,955,651 -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------ Total Expenses 5,069,730 19,650 21,353 38,430 58,822 - ------------------------------------------------------------------------------------------------------------------------ Loss from Continuing Operations (5,069,730) (19,650) (21,353) (38,430) (58,822) Loss from Discontinued Operations (5,252,281) -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------ Net Loss (10,322,011) (19,650) (21,353) (38,430) (58,822) ======================================================================================================================== Net Loss Per Share - Basic and Diluted (0.01) (0.01) (0.01) (0.01) ======================================================================================================================== Weighted Average Shares Outstanding 2,841,000 2,841,000 2,841,000 2,841,000 ======================================================================================================================== (1) Stock-based compensation is excluded from: General and administrative 1,955,651 -- -- -- -- ========================================================================================================================
(The accompanying notes are an integral part of the financial statements) 4
Xerion EcoSolutions Group Inc. (A Development Stage Company) Statements of Cash Flows (expressed in U.S. Dollars) (unaudited) For the Six Months Ended June 30, 2005 2004 $ $ Cash Flows to Operating Activities Net loss (38,430) (58,822) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 1,469 1,617 Loss on disposal of property and equipment -- 7,866 Changes in operating assets and liabilities: Prepaid expenses -- 903 Accounts payable and accrued liabilities 32,971 12,476 - ------------------------------------------------------------------------------------------------ Net Cash Used in Operating Activities (3,990) (35,960) - ------------------------------------------------------------------------------------------------ Cash Flows from Investing Activities Proceeds from sale of property, plant and equipment Purchase of mining claims -- 9,000 - ------------------------------------------------------------------------------------------------ Net Cash Provided By Investing Activities -- 9,000 - ------------------------------------------------------------------------------------------------ Cash Flows from (to) Financing Activities Advances from a related party 13,234 -- Repayments to a related party -- (1,015) - ------------------------------------------------------------------------------------------------ Net Cash Provided By (Used in) Financing Activities 13,234 (1,015) - ------------------------------------------------------------------------------------------------ Increase (Decrease) in Cash 9,244 (27,975) Cash - Beginning of Period 2,333 33,685 - ------------------------------------------------------------------------------------------------ Cash - End of Period 11,577 5,710 ================================================================================================ Non-cash Financing and Investing Activities -- -- ================================================================================================ Supplemental Disclosures Interest paid -- -- Income tax paid -- -- ================================================================================================
(The accompanying notes are an integral part of the financial statements) 5 Xerion EcoSolutions Group Inc. (A Development Stage Company) Notes to the Financial Statements (expressed in U.S. Dollars) (unaudited) 1. Nature of Operations and Continuance of Business Xerion EcoSolutions Group Inc. (the "Company") was incorporated on November 1, 1985 under the laws of the State of Colorado. The shares of the Company currently trade on the Over the Counter Bulletin Board under the ticker symbol "XECO". The Company had been working with a specialist consultant in the field of hydrometallurgy. This work included a potential research project focused of developing a viable alternative to cyanide for the gold mining industry. The consultant has identified specific chemical conditions in the application of certain non-toxic reagents that could lead to a significant breakthrough in the development of a replacement for cyanide. The prospects of developing and bringing to market a technology of this magnitude may exceed the Company's ability and management is evaluating the possibility of merging with another, more established company with existing operations and cash flow. The Company is a development stage company as defined by Statement of Financial Accountings Standards ("SFAS") No. 7 "Accounting and Reporting by Development Stage Enterprises". In a development stage company, management devotes most of its activities in developing a market for its products and/or services. The Company is presently in its developmental stage and currently has no sources of revenue to provide incoming cash flows to sustain future operations. As at June 30, 2005, the Company has a working capital deficit of $182,123 (December 31, 2004 - $145,162) and has an accumulated deficit of $10,322,011 since its inception. The ability of the Company to emerge from the development stage with respect to any planned principal business activity is dependent upon its successful efforts to raise additional equity financing and then generate significant revenue. Management has plans to seek additional capital through equity and/or debt offerings. There is no guarantee that the Company will be able to complete any of the above objectives. These factors raise substantial doubt regarding the Company's ability to continue as a going concern. 2. Summary of Significant Accounting Policies a) Basis of Accounting and Year End These financial statements are prepared in conformity with accounting principles generally accepted in the United States and are presented in U.S. dollars. The Company's fiscal year end is December 31. b) Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods. Actual results could differ from those estimates. c) Cash and Cash Equivalents The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents. d) Property and Equipment Property and equipment consists of computer equipment recorded at cost and depreciated on a straight-line basis over the estimated useful life of three years. e) Long-lived Assets In accordance with Financial Accounting Standards Board ("FASB") SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets", the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes an impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value. 6 Xerion EcoSolutions Group Inc. (A Development Stage Company) Notes to the Financial Statements (expressed in U.S. Dollars) (unaudited) 2. Summary of Significant Accounting Policies (continued) f) Financial Instruments The carrying value of cash, accounts payable and accrued liabilities and due to related party approximate fair value due to the immediate or short-term maturity of these financial instruments. g) Mineral Property Costs The Company has been engaged in the acquisition, exploration and development of mining properties. Mineral property acquisition and exploration costs are expensed as incurred. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. h) Income Taxes Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted SFAS No. 109, "Accounting for Income Taxes", as of its inception. Pursuant to SFAS No. 109 the Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years. i) Foreign Currency Transactions The Company's functional and reporting currency is the United States dollar. Occasional transactions occur in Canadian currency, and management has adopted SFAS No. 52, "Foreign Currency Translation". Monetary assets and liabilities denominated in foreign currencies are translated into United States dollars at rates of exchange in effect at the balance sheet date. Non-monetary assets, liabilities and items recorded in income arising from transactions denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. j) Stock-based Compensation The Company has adopted SFAS No. 123 "Accounting for Stock Based Compensation" which requires that stock awards granted to employees and non-employees are recognized as compensation expense based on the fair market value of the stock award or fair market value of the goods and services received whichever is more reliably measurable. k) Basic and Diluted Net Income (Loss) per Share The Company computes net income (loss) per share in accordance with SFAS No. 128, "Earnings per Share" (SFAS 128). SFAS 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, and convertible preferred stock, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. Loss per share information does not include the effect of any potential common shares, as their effect would be anti-dilutive. l) Comprehensive Loss SFAS No. 130, "Reporting Comprehensive Income," establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at June 30, 2005 and 2004, the Company has no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements. 7 Xerion EcoSolutions Group Inc. (A Development Stage Company) Notes to the Financial Statements (expressed in U.S. Dollars) (unaudited) 2. Summary of Significant Accounting Policies (continued) m) Recent Accounting Pronouncements In December 2004, the FASB issued SFAS No. 123 (Revised 2004) ("SFAS No. 123R"), "Share-Based Payment." SFAS No. 123R requires that the compensation cost relating to share-based payment transactions be recognized in financial statements. That cost will be measured based on the fair value of the equity or liability instruments issued. SFAS No. 123R represents the culmination of a two-year effort to respond to requests from investors and many others that the FASB improve the accounting for share-based payment arrangements with employees. The scope of SFAS No. 123R includes a wide range of share-based compensation arrangements including share options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. SFAS No. 123R replaces SFAS No. 123, "Accounting for Stock-Based Compensation", and supersedes APB Opinion No. 25, "Accounting for Stock Issued to Employees". SFAS No. 123, as originally issued in 1995, established as preferable a fair-value-based method of accounting for share-based payment transactions with employees. However, that statement permitted entities the option of continuing to apply the guidance in APB Opinion No. 25, as long as the footnotes to the financial statements disclosed what net income would have been had the preferable fair-value-based method been used. Although those disclosures helped to mitigate the problems associated with accounting under APB Opinion No. 25, many investors and other users of financial statements believed that the failure to include employee compensation costs in the income statement impaired the transparency, comparability, and credibility of financial statements. Public entities that file as small business issuers will be required to apply Statement 123R in the first interim or annual reporting period that begins after December 15, 2005. The adoption of this standard is not expected to have a material impact on the Company's results of operations or financial position. In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets - An Amendment of APB Opinion No. 29". SFAS No. 153 is the result of a broader effort by the FASB to improve financial reporting by eliminating differences between GAAP in the United States and GAAP developed by the International Accounting Standards Board (IASB). As part of this effort, the FASB and the IASB identified opportunities to improve financial reporting by eliminating certain narrow differences between their existing accounting standards. SFAS No. 153 amends APB Opinion No. 29, "Accounting for Nonmonetary Transactions", that was issued in 1973. The amendments made by SFAS No. 153 are based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged. Further, the amendments eliminate the narrow exception for nonmonetary exchanges of similar productive assets and replace it with a broader exception for exchanges of nonmonetary assets that do not have "commercial substance." Previously, APB Opinion No. 29 required that the accounting for an exchange of a productive asset for a similar productive asset or an equivalent interest in the same or similar productive asset should be based on the recorded amount of the asset relinquished. The provisions in SFAS No.153 are effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June 15, 2005. Early application is permitted and companies must apply the standard prospectively. The effect of adoption of this standard is not expected to have a material impact on the Company's results of operations and financial position. The FASB has also issued SFAS No. 151 and 152, but they will not have any relationship to the operations of the Company. Therefore, a description and its impact for each on the Company's operations and financial position have not been disclosed. In March 2005, the SEC staff issued Staff Accounting Bulletin No. 107 ("SAB 107") to give guidance on the implementation of SFAS No. 123R. The Company will consider SAB 107 during the implementation of SFAS No. 123R. n) Reclassifications Certain reclassifications have been made to the prior period's financial statements to conform to the current period's presentation. 8 Xerion EcoSolutions Group Inc. (A Development Stage Company) Notes to the Financial Statements (expressed in U.S. Dollars) (unaudited) 2. Summary of Significant Accounting Policies (continued) o) Interim Financial Statements These interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company's financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period. 3. Property and Equipment June 30, December 31, 2005 2004 Net Book Net Book Accumulated Value Value Cost Depreciation $ $ $ $ (unaudited) (audited) Computer equipment 9,207 5,840 3,367 4,836 ----------------------------------------------------- 4. Related Party Transactions a) The Company accrued $30,000 during the six months ended June 30, 2005 (2004 - $30,000) to the President of the Company for management services rendered. b) Included in accounts payable is a balance of $150,000 (December 31, 2004 - $120,000) payable to the President of the Company. c) The amount of $13,234 (December 31, 2004 - $Nil) due to the President of the Company for cash advances and expenses paid on behalf of the Company is without interest, unsecured and due on demand. Item 2 - Management's Discussion and Analysis or Plan of Operation - ------------------------------------------------------------------ Caution Regarding Forward-Looking Information - --------------------------------------------- This quarterly report contains certain forward-looking statements and information relating to the Company that are based on the beliefs of the Company or management as well as assumptions made by and information currently available to the Company or management. When used in this document, the words "anticipate", "believe", "estimate", "expect" and "intend" and similar expressions, as they relate to the Company or its management, are intended to identify forward-looking statements. Such statements reflect the current view of the Company regarding future events and are subject to certain risks, uncertainties and assumptions, including the risks and uncertainties noted. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended. In each instance, forward-looking information should be considered in light of the accompanying meaningful cautionary statements herein. General Business Overview - ------------------------- Xerion EcoSolutions Group Inc. was originally incorporated in Colorado in 1985 as Gemini Ventures, Inc. The name was changed in 1989 to Solomon Trading Company, Ltd., in 1994 to the Voyageur First, Inc., in 1995 to North American Resorts, Inc., in 2000 to Immulabs Corp. Effective March 28, 2003, as filed with the State of Colorado, the Company changed its name to Xerion EcoSolutions Group Inc. and is currently in the business of developing gold extraction technology for the mining industry. 9 In November 2000, Immulabs acquired the exclusive rights to purchase technologies developed by Quest Research Group, Inc. ("Quest") of Boston, Massachusetts, and to buy up to 100% of that company. Quest's biotech research had resulted in the development of two technologies of interest to the Company, which the Company hoped to commercialize. With the exclusive rights to acquire secured, the Company had been performing its due diligence pursuant to its option contract with Quest in order to evaluate the technology and develop its commercialization strategy. The parties entered into a dispute and the Company contacted Quest to seek mediation or arbitration as provided for in the option agreement. The Company subsequently learned that Quest had insufficient assets to warrant litigation and decided at this time not to pursue further legal action. In October 2002, the Company retained Ben Traub as President of the company. Mr. Traub was to identify new business opportunities on behalf of the Company. On March 17, 2003 the Company purchased 67 mining claims and certain ore and waste processing technologies. In compliance with the purchase agreements, the vendors were obligated to deliver exploration and metallurgical data to support the representations made about the processing technologies and claims. The Vendors neglected to deliver this documentation. Subsequent to December 31, 2003 the Company has canceled the purchase agreements. The cancellation of the purchase results in a reimbursement of 2.5 million shares to the company, which substantially reduced the issued and outstanding shares of the Company. For over a year the Company has been working with Dr. David Dreisinger (1), a specialist consultant in the field of hydrometallurgy. This work has included a research project focused on developing a viable alternative to cyanide for the gold mining industry. As a result of this consulting project, Dr. Dreisinger has identified certain chemical conditions in the application of certain non-toxic reagents that he believes could lead to a significant breakthrough in the development of a replacement for cyanide. Cyanide is currently used to extract in excess of 80% of the world's gold production. Cyanide is widely known to be toxic and dangerous to work with (2). Due to many accidental spills of cyanide into lakes, streams and drinking water, the use of cyanide has come under close scrutiny by environmental regulators. Public awareness of the perceived dangers has led to the use of cyanide being banned or severely restricted in some areas of the world, thus providing a commercial opportunity for alternative gold extraction systems. For example, Canyon Resources has a 10.9 million ounce gold deposit that is currently impeded from development by the anti-mining initiative, I-137, which bans development of new gold and silver mines which use open-pit mining and cyanide in the treatment and recovery process in the State of Montana (3). To date, no alternative gold extraction system has found broad commercial success due to associated problems with chemistry and/or economics (4). It is Xerion's goal to develop a less toxic alternative to cyanide for the gold mining industry. There is currently little market for cyanide alternatives due to the wide use of cyanide and its strong market dominance. However, due to the current regulatory climate, it is possible that substantial proof of concept by a less toxic alternative could result in adoption by the mining industry. Dr. Dreisinger has identified and proposed certain chemical conditions under which selected non-toxic reagents could potentially operate economically, at the same time avoid known handicaps previously associated with such chemistry. A substantial review of related literature and existing patents has not revealed any other work that has utilized these proposed chemical conditions. The Company is currently in discussions with Dr. Dreisinger (5) regarding the necessary bench scale lab work to prove out Dr. Dreisinger's hypothesis. If an agreement with Dr. Dreisinger is consummated, research work is anticipated to take place at the University of British Columbia. (1) www.mmat.ubc.ca/units/bioh/people/dreisinger/dreisinger.html (2) www.cyanidecode.org/library/cn_facts_health.html (3) www.canyonresources.com/projects/mcdon.html (4) http://technology.infomine.com/enviromine/publicat/cyanide.pdf (5) www.mmat.ubc.ca/research/groups/hydromet.htm The prospect of developing and bringing to market a technology of this magnitude exceeds the Company's current ability. Management is evaluating the possibility of merging with another, more established company with existing operations and cash flow. Results of Operations for the Six Months Ended June 30, 2005 - ------------------------------------------------------------ Revenues. The Company currently has no revenues from operations, and the Company does not anticipate that it will generate any revenues in the near future. 10 The Company incurred a net loss of $38,430 compared to $58,822 in the equivalent period of 2004. Liquidity and Capital Resources. The primary source of the Company's cash has been through the sale of equity. Our cash increased to $11,577 at June 30, 2005 from $742 at March 31, 2005 as the President of the Company advanced $13,234 to the Company during the past quarter. As at June 30, 2005, the Company has a working capital deficit of $182,123 as compared to $163,224 at March 31, 2005. Future expenses will either be financed by the President of the Company or in the form of private placements. The Company believes its current available cash position and access to capital is sufficient to meet its cash needs on a short-term basis. The Company's ability to continue as a going concern is dependent upon the Company's ability in the near future to (i) raise additional funds through equity financings, and (ii) loans from significant shareholders. Item 3 - Controls and Procedures - -------------------------------- EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Company's Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-15 under the Exchange Act) as of the end of period covered by this quarterly report (the "Evaluation Date"). Based on such evaluation, such officers have concluded that, as of the Evaluation Date, the Company's disclosure controls and procedures are effective. CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING. During the most recent fiscal quarter, there have not been any significant changes in the Company's internal controls over financial reporting or in other factors that have materially affected, or are reasonably likely to materially affect internal controls over financial reporting. PART 2 - OTHER INFORMATION - -------------------------- Item 1 - Legal Proceedings - -------------------------- To the best knowledge of the Officers and Directors of the Company, neither the Company nor any of its Officers and Directors are parties to any legal proceeding or litigation other than as described below. Further, the Officers and Directors know of no threatened or contemplated legal proceedings or litigation other than as described below. The current Management learned in late 2002 that the Company was in legal dispute over the purchase of a shuttle bus in 1998. The owners of the bus lost the vehicle in bankruptcy and were looking to recoup $97,508.58 plus associated costs through litigation. As per an existing indemnification agreement, Former Directors of the Company hired a law firm to represent the company and the case was settled with a negotiated judgment being awarded against a company not associated with Xerion. Xerion has no liabilities in this matter. Item 2 - Changes in Securities - ------------------------------ None Item 3 - Defaults Upon Senior Securities - ---------------------------------------- None Item 4 - Submission Of Matters To A Vote Of Security Holders - ------------------------------------------------------------ None Item 5 - Other Information - -------------------------- None 11 Item 6 - Exhibits and Reports on Form 8-K - ----------------------------------------- Exhibits - -------- 31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a) promulgated under the Securities and Exchange Act of 1934, as amended 31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14 Rule 15d-14(a) promulgated under the Securities and Exchange Act of 1934, as amended 32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Executive Officer) 32.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Principal Financial Officer) Reports on Form 8-K - ------------------- None SIGNATURES In accordance with the requirements of the Securities Exchange Act, the Registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on this 15th day of August, 2005 Xerion EcoSolutions Group Inc. /s/ Ben Traub - ------------------------------------ Ben Traub, President, Chief Executive Officer and Director /s/ Robert Skanes - ------------------------------------ Robert Skanes, Chief Financial Officer, Secretary and Director EX-31.1 2 xerion10qsbex311063005.txt SECTION 302 CERTIFICATION OF CEO Exhibit 31.1 SARBANES-OXLEY SECTION 302(a) CERTIFICATION Principal Executive Officer I, Ben Traub, certify that: 1. I have reviewed this quarterly report of Xerion EcoSolutions Group Inc; 2. Based on my knowledge, this 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 report; 3. Based on my knowledge, the financial statements, and other financial information included in this 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 report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: 1. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared; 2. evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 3. disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): 1. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and 2. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: August 15, 2005 /s/ Ben Traub Ben Traub Principal Executive Officer EX-31.2 3 xerion10qsbex312063005.txt SECTION 302 CERTIFICATION OF CFO Exhibit 31.2 SARBANES-OXLEY SECTION 302(a) CERTIFICATION Principal Financial Officer I, Robert Skanes, certify that: 1. I have reviewed this quarterly report of Xerion EcoSolutions Group Inc; 2. Based on my knowledge, this 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 report; 3. Based on my knowledge, the financial statements, and other financial information included in this 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 report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: 1. designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared; 2. evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 3. disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): 1. all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and 2. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: August 15, 2005 /s/ Robert Skanes Robert Skanes Principal Financial Officer EX-32.1 4 xerion10qsbex321063005.txt SECTION 906 CERTIFICATION OF CEO Exhibit 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. Section 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Xerion EcoSolutions Group Inc. (the "Company") on Form 10-QSB for the quarter ended March 31, 2005 as filed with the Securities and Exchange Commission on the date here of (the "report"), I, Ben Traub, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (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 this Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated this 15th day of August, 2005. /s/ Ben Traub Ben Traub Principal Executive Officer EX-32.2 5 xerion10qsbex322063005.txt SECTION 906 CERTIFICATION OF CFO Exhibit 32.2 CERTIFICATION PURSUANT TO 18 U.S.C. Section 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Xerion EcoSolutions Group Inc. (the "Company") on Form 10-QSB for the quarter ended March 31, 2005 as filed with the Securities and Exchange Commission on the date here of (the "report"), I, Robert Skanes, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (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 this Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated this 15th day of August, 2005. /s/ Robert Skanes Robert Skanes Principal Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----