form10-q.htm

0001264931-08-000520.txt : 20081114 0001264931-08-000520.hdr.sgml : 20081114 20081114140613 ACCESSION NUMBER: 0001264931-08-000520 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20080930 FILED AS OF DATE: 20081114 DATE AS OF CHANGE: 20081114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEXIA HOLDINGS INC CENTRAL INDEX KEY: 0000833209 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE OPERATORS (NO DEVELOPERS) & LESSORS [6510] IRS NUMBER: 841062062 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 033-22128-D FILM NUMBER: 081189674 BUSINESS ADDRESS: STREET 1: 59 WEST 100 SOUTH CITY: SALT LAKE CITY STATE: UT ZIP: 84101 BUSINESS PHONE: 8015758073 MAIL ADDRESS: STREET 1: 59 WEST 100 SOUTH CITY: SALT LAKE CITY STATE: UT ZIP: 84101 FORMER COMPANY: FORMER CONFORMED NAME: KELLYS COFFEE GROUP INC DATE OF NAME CHANGE: 19940603 FORMER COMPANY: FORMER CONFORMED NAME: GREAT EARTH VITAMIN GROUP INC DATE OF NAME CHANGE: 19940107 FORMER COMPANY: FORMER CONFORMED NAME: WELCOM CAPITAL INC DATE OF NAME CHANGE: 19920703 10-Q 1 form10-q.htm NEXH 10-Q 09.30.08 form10-q.htm

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 2008.

[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to .

Commission file number: 33-22128-D

NEXIA HOLDINGS, INC.

(Exact name of small business issuer as specified in its charter)

Nevada

(State or other jurisdiction of

incorporation or organization)

84-1062062

(I.R.S. Employer Identification No.)

59 West 100 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 X No

Indicate by check mark whether the registrant is a shell company. Yes [ ] No [ X ]

The number of outstanding shares of the issuer's common stock, $0.0001 par value, as of November 14, 2008 was 742,539,532.

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS……………………………….…….…….…….…….…….…….…….…….…….…….…….…….…….			3
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS…..…….…….…….…….…….…….….…….…….…….…….…….…….…....			13
ITEM 3. CONTROLS AND PROCEDURES……………………...…….…….…….…….…….…….….…….…….…….…….…….…….…...			15
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS………………………………...…….…….…….…….…….…….….…….…….…….…….…….…….…....			16
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS …….…….…….…….…….…….......................			16
ITEM 3. DEFAULTS UPON SENIOR SECURITIES………….....…….…….…….…….…….…….….…….…….…….…….…….…….……			16
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS …….…….…….…….…….…….......................................			16
ITEM 5. OTHER INFORMATION………………………………..…….…….…….…….…….…….….…….…….…….…….…….…….…....			16
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K………………….…….…….…….…….…….….…….…….…….…….…….…….…....			17
SIGNATURES……………………………………………………...…….…….…….…….…….…….….…….…….…….…….…….…….…....			18
INDEX TO EXHIBITS…………………………………………….…….…….…….…….…….…….….…….…….…&# 8230;.…….…….…….…….			19

Table of Contents

ITEM 1. FINANCIAL STATEMENTS

As used herein, the term "Nexia" refers to Nexia Holdings, Inc., a Nevada corporation, its subsidiary corporations and predecessors unless otherwise indicated. The accompanying unaudited, condensed consolidated interim financial statements have been prepared in accordance with the instructions to Form 10-Q pursuant to the Securities and Exchange Commission and, therefore, do not include all information and footnotes necessary for a complete presentation of our financial position, results of operations, cash flows and stockholders' equity in conformity with generally accepted accounting principles in the United States of America. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature.

Our consolidated financial statements are attached hereto as pages 4 through 12 and are incorporated herein by this reference.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	PAGE


Condensed Consolidated Balance Sheets - September 30, 2008 and December 31, 2007 (Unaudited)		5

Condensed Consolidated Statements of Operations and Other Comprehensive Loss for the Three and Nine Months Ended September 30, 2008 and 2007 (Unaudited)		7

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2008 and 2007 (Unaudited)		9

Notes to Condensed Consolidated Financial Statements (Unaudited)		11

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)



	September 30,		December 31,
ASSETS	2008		2007


CURRENT ASSETS

Cash	$	14,618	$	95,760
Investment in marketable equity securities - available for sale		177,640		195,499
Trade accounts receivable, net of allowance for
doubtful accounts of $91,036 and $91,036, respectively		21,317		50,343
Accounts receivable - related parties		1,058		2,166
Accounts receivable - contingency		-		17,822
Inventory		133,505		333,681
Prepaid expenses		969,006		341,284
TOTAL CURRENT ASSETS		1,317,144		1,036,555

PROPERTY AND EQUIPMENT

Property and equipment, net of $825,762 and $807,933
accumulated depreciation, respectively		1,113,390		1,989,588
Land		633,520		181,945
Property, net - held for sale		1,362,950		1,362,950

TOTAL NET PROPERTY AND EQUIPMENT		3,109,860		3,534,483

OTHER ASSETS

Goodwill		135,088		227,681
Loan costs, net		42,692		45,386
Trademarks		1,380		1,380

TOTAL OTHER ASSETS		179,160		274,447

TOTAL ASSETS	$	4,606,164	$	4,845,485


The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Continued)
(Unaudited)

			Septem ber 30,	December 31,
LIABILITIES AND STOCKHOLDERS' DEFICIT			2008	2007

CURRENT LIABILITIES
	Accounts payable		$ 931,982	$ 640,142
	Accounts payable - related parties		123,587	127,512
	Accrued liabilities		1,026,286	757,201
	Accrued interest - related parties		142,202	186,306
	Refundable deposits		18,847	17,414
	Deferred revenue		15,000	-
	Current maturities of long-term debt		819,336	812,818
	Current maturities of long-term debt - related parties		155,414	189,610

TOTAL CURRENT LIABILITIES			3,232,654	2,731,003

LONG-TERM LIABILTIES
	Series A convertible preferred stock - $0.001 par value; 10,000,000
		shares authorized - 200,000 shares outstanding - liquidation value
		$2,000,000	2,000,000	2,000,000
	Series C convertible preferred stock - $0.001 par value; 5,000,000
		shares authorized - 832,225 shares outstanding - liquidation value
		$4,759,986	4,759,986	4,161,125
	Long-term debt		2,252,060	2,314,520
	Long-term debt - related parties		100,000	330,000

TOTAL LONG-TERM LIABILITIES			9,112,046	8,805,645

TOTAL LIABILITIES			12,344,700	11,536,648

MINORITY INTEREST			183,663	178,951

STOCKHOLDERS' DEFICIT
	Series B preferred stock - $0.001 par value; 10,000,000
		shares authorized; 10,000,000 shares outstanding	10,000	10,000
	Undesignated preferred stock - $0.001 par value;
		25,000,000 shares authorized; no shares outstanding	-	-
	Common stock - $0.0001 par value; 5,500,000,000 shares
		authorized; 78,539,532 shares and 149,774 shares
		outstanding, respectively	7,854	15
	Additional paid-in capital		20,992,929	18,290,001
	Receivable from stockholders		(47,769)	(168,663)
	Accumulated other comprehensive loss		(3,409)	(819,556)
	Accumulated deficit		(28,881,804)	(24,181,911)

Total Stockholders’ Deficit			(7,922,199)	(6,870,114)

TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIT			$ 4,606,164	$ 4,845,485


The accompanying notes are an integral part of these consolidated financial statements.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2008			2007			2008			2007


REVENUE
Sales - Salon and Retail	$	560,638		$	711,557		$	1,953,287		$	2,097,611
Rental revenue		47,040			51,109			150,178			174,256

TOTAL REVENUE		607,678			762,666			2,103,465			2,271,867

COST OF REVENUE
Cost of sales - Salon and Retail		258,703			297,115			992,418			1,069,561
Cost associated with rental revenue		15,319			24,167			114,843			113,151
Depreciation and amortization on rentals		14,388			21,891			43,195			67,670

TOTAL COST OF REVENUE		288,410			343,173			1,150,456			1,250,382

GROSS INCOME		319,268			419,493			953,009			1,021,485

EXPENSES
General and administrative expense		2,012,441			1,559,506			3,724,171			3,931,863
Consulting fees		45,569			15,125			347,581			249,305
Depreciation and amortization expense		27,725			41,745			87,159			101,601
Interest expense associated with rental revenue		39,236			42,765			114,977			121,619
Loss on impairment of assets		-			-			154,940			-

TOTAL EXPENSES		2,124,971			1,659,141			4,428,828			4,404,388

OPERATING LOSS		(1,805,703	)		(1,239,648	)		(3,475,819	)		(3,382,903	)

OTHER INCOME (EXPENSE)
Derivative loss related to Series A and C
convertible preferred stock		-			-			(3,750	)		-
Bad debt expense - convertible debenture		-			-			(50,000	)		-
Interest expense		(40,300	)		(27,075	)		(156,803	)		(205,444	)
Gain/(loss) on marketable securities		3,000			(12,677	)		(841,299	)		283,050
Income from litigation settlement		-			-			60,000			-
Loss on disposal of assets		-			-			(216,572	)		(250	)
Other income		2,151			3,861			9,433			16,253

TOTAL OTHER INCOME (EXPENSE)		(35,149	)		(35,891	)		(1,198,991	)		93,609

LOSS BEFORE INCOME TAXES		(1,840,852	)		(1,275,539	)		(4,674,810	)		(3,289,294	)
Provision for state income tax		-			(3,900	)		-			(3,900	)

NET LOSS BEFORE MINORITY INTEREST		(1,840,852	)		(1,279,439	)		(4,674,810	)		(3,293,194	)

MINORITY INTEREST IN INCOME		(20,700	)		7,225			(25,083	)		4,391

NET LOSS	$	(1,861,552	)	$	(1,272,214	)	$	(4,699,893	)	$	(3,288,803	)

The accompanying notes are an integral part of these consolidated financial statements.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations and Comprehensive Loss (Continued)
(Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2008			2007			2008			2007

BASIC AND DILUTED LOSS PER COMMON SHARE	$	(0.18	)	$	(71.55	)	$	(3.58	)	$	(230.08	)

BASIC AND DILUTED WEIGHTED-AVERAGE
COMMON SHARES OUTSTANDING		10,553,635			17,781			1,313,691			14,294

COMPREHENSIVE LOSS

Net Loss	$	(1,861,552	)	$	(1,272,214	)	$	(4,699,893	)	$	(3,288,803	)
Change in unrealized value of marketable securities		(1,178	)		1,373			(840,017	)		(207,305	)
Reclassification adjustment for permanent loss on
marketable securities included in net loss		-			-			829,464			-

Comprehensive Loss	$	(1,862,730	)	$	(1,270,841	)	$	(4,710,446	)	$	(3,496,108	)


The accompanying notes are an integral part of these consolidated financial statements.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
	For the Nine Months Ended
	September 30,
	2008			2007

CASH FLOWS FROM OPERATING ACTIVITIES

Net loss	$	(4,699,893	)	$	(3,288,803	)
Adjustments to reconcile net loss
to net cash used in operating activities:
Minority interest income (loss)		4,712			6,334
Depreciation and amortization expense		132,194			170,670
Abandonment of leasehold improvements		232,385			-
Preferred and common stock issued for services and
contractual agreements		1,063,913			991,435
Stock options issued		257,905			-
Amortization of issued Series C preferred shares
on an as if converted basis		671,875			-
Loss on sale of marketable securities		74,014			-
Write down investment in marketable securities		785,285			-
Convertible debt terminated		50,000			(22,500	)
Fixed assets impaired		62,348			-
Write down goodwill		92,593			-
Issue common stock to pay contractual debt		965,272			-
Depreciation expense capitalized in inventory		-			36,943
Loss on disposal of assets		-			11
Expense receivables from stockholders for sales
at values lower than values when stock was issued		-			675,348
Allowance for doubtful accounts receivable		-			(12,696	)

Changes in operating assets and liabilities:
Receivables		(164	)		29,296
Accounts receivable - related parties		1,108			40,900
Inventory		200,176			(3,534	)
Prepaid expense		(667,722	)		116,143
Accounts payable		292,680			281,963
Accounts payable - related parties		(3,925	)		96,142
Checks in excess of bank statement balance		-			2,232
Accrued liabilities		269,085			183,596
Accrued liabilities - related parties		77,428			154,808
Refundable deposits		-			3,563
Deferred revenue		15,000			(28	)
Net cash used in operating activities		(123,731	)		(538,177	)

CASH FLOWS FROM INVESTING ACTIVITIES
Sale of marketable securities		32,361			62,376
Purchase of marketable securities		(57,654	)		(33,072	)
Fixed assets acquired by issuing Nexia stock		-			10,000
Acquired equipment and loan costs by acquisition of Newby
Salons, LLC		-			(90,917	)
Goodwill from acquisition of Newby Salons, LLC		-			(254,396	)
Issued preferred stock for acquisition of Newby Salons, LLC		-			299,940
Adjustment of investment in marketable securities		-			(1,562	)
Purchase of capital assets		(27,194	)		(243,610	)
Disposal of capital assets		17,858			-
Net cash used in investing activities		(34,629	)		(251,241	)

The accompanying notes are an integral part of these consolidated financial statements.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)

	For the Nine Months Ended
	September 30,
	2008			2007

CASH FLOWS FROM FINANCING ACTIVITIES

Payments on long-term debt and capital lease obligations		(61,772	)		(41,021	)
Principal payment on long term debt-related parties		-			(122,245	)
Pay off of short-term debt		-			(87,000	)
New loan for retail stores construction					167,670
Long-term loan aquired with acquisition of Newby Salons, LLC					70,503
New line of credit with Bank of the West					1,066
New loan costs					(1,800	)
Proceeds from notes payable		12,960			-
Proceeds from issuing Series C preferred stock		25,000			-
Proceeds from stock subscriptions		101,030			693,191
Net cash provided by financing activities		77,218			680,364

NET DECREASE IN CASH AND CASH EQUIVALENTS		(81,142	)		(109,054	)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		95,760			124,158

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	14,618		$	15,104

SUPPLEMENTAL DISCLOSURE OF INFORMATION

CASH PAID FOR:

Interest	$	113,867		$	119,793

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:

Common stock issued for subscriptions receivable	$	251,032		$	1,152,629
Common stock issued to vendors applied on accounts payable		-		$	228,250
Stock sales at values lower than stock issue values	$	177,591		$	675,348
Conversion debenture to common stock		-		$	193,901
New note payable to vendor in satisfaction of accounts payable balance		-			117,513
Applied rent receivable, related party, against note payable		-			30,817

The accompanying notes are an integral part of these consolidated financial statements.

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NEXIA HOLDINGS, INC. AND SUBSIDIARIES

Notes to the Condensed Consolidated Financial Statements

September 30, 2008

(Unaudited)

NOTE 1 - BASIS OF FINANCIAL STATEMENT PRESENTATION

The accompanying unaudited condensed consolidated financial statements for Nexia Holdings, Inc. and Subsidiaries (the Company) 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 consolidated financial statements includes 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 condensed consolidated financial statements be read in conjunction with the Company’s most recent annual consolidated financial statements and notes thereto included in its December 31, 2007 Annual Report on Form 10-K. Operating results for the three and nine months ended September 30, 2008 are not indicative of the results that may be expected for the year ending December 31, 2008.

NOTE 2 - RECENT ACCOUNTING PRONOUNCEMENTS

FASB Interpretation No. 159 "The Fair Value Option for Financial Assets and Financial Liabilities, including an amendment of FASB Statement No. 115" (FAS 159) - In February 2007, the FASB issued Statement No. 159. FAS 159 permits companies to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value and establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. The provisions of FAS 159 become effective as of the beginning of our 2009 fiscal year. We are currently evaluating the impact that FAS 159 will have on our future financial statements, if we elect to adopt it.

FASB Statement No. 160 amends Accounting Research Bulletin No. 51, Consolidated Financial Statements, and requires all entities to report noncontrolling (minority) interests in subsidiaries within equity in the consolidated financial statements, but separate from the parent shareholders’ equity. Statement No. 160 also requires any acquisitions or dispositions of noncontrolling interests that do not result in a change of control to be accounted for as equity transactions. Further, the Statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. FAS 160 is effective for fiscal years beginning after December 15, 2008. We are currently assessing the impact of adopting FAS 160 on our results of operations and financial condition.

FASB Statement No. 161, “Disclosures about Derivatives Instruments and Hedging Activities”, an amendment of FASB Statement No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“FAS 161”). In March 2008, the FASB issued SFAS No. 161, which changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures stating how and why an entity uses derivative instruments; how derivative instruments and related hedged items are accounted for under SFAS No. 133 and its related interpretations; and how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. FAS 161 requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation. FAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. FAS 161 also encourages but does not require comparative disclosures for earlier periods at initial adoption. The Company is currently evaluating whether the adoption of FAS 161 will have an impact on our financial statements.

NOTE 3 – GOING CONCERN

The Company's consolidated financial statements are prepared using accounting principles generally accepted in the United States 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 losses from operations through September 30, 2008 of $28,881,804, has a working capital deficit of $1,915,510 and a stockholders’ deficit of $7,922,199 at September 30, 2008. In addition, the Company has defaulted on several of its liabilities, has closed three retail clothing stores, and has entered into an agreement to sell one of its commercial real estate properties. These matters raise substantial doubt about the Company’s ability to continue as a going concern.

Primarily, revenues have not been sufficient to cover the Company’s operating costs. Management’s plans to enable the Company to continue as a going concern include the following:

•	Purchase of revenue producing residential properties

•	Increase retail sales of existing Landis Salons, Inc. and Style Perfect, Inc.

•	Acquire existing revenue producing salons for equity in the Company

•	Using stock and option-based compensation to cover payroll and other permissible labor costs

•	Raise capital through the Company’s equity line of credit upon the effectiveness of a pending S-1 Registration Statement

• Increasing revenues from rental properties by implementing new marketing programs

•	Making certain improvements to certain rental properties in order to make them more marketable

•	Reduce expenses through consolidating or disposing of certain subsidiary companies

•	Convert certain debt into shares of the Company’s common stock

•	Implement a major marketing campaign to sell our products online at www.blackchandelier.com

There can be no assurance that the Company can or will be successful in implementing any of its plans or that it will be successful in enabling the Company to continue as a going concern. The Company’s consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

NOTE 4 - COMMON STOCK

The Company has issued options to purchase Common Stock and non-option shares to employees and outside contractors for services during the years 2008 and 2007. The majority of stock issued is from the exercise of stock options. Options are issued with either a “floating” exercise price, usually set at 50% of the market price on the sale date, or the options are granted with a fixed price set by the Board of Directors when the option is granted to the recipient. The floating exercise price is determined when the employee or service provider finalizes the exercise of the option by a sale of the shares underlying the option or pays the exercise price. In accordance with SFAS No. 123 (R), options issued to employees are valued using the Black-Scholes model. The value of common shares that are issued for services is based on the fair value of the common stock on the date of issuance.

During the nine months ended September 30, 2008, the Company issued 28,410,900 shares of common stock, pursuant to the Company’s S-8 Registration Statement, valued at $1,825,884. 1,289,150 of these shares were issued as option shares to employees with a value of $1,012,065 in exchange for services rendered. The Company had a decrease in its receivable from stockholders of $120,894 for the exercise price due to the Company from outstanding option shares. Nexia received $101,030 in cash for its receivable from stockholders. The Company reduced paid in capital by $177,591 for stock subscription receivable adjustment in the first nine months of 2008. The ending balance of stock subscriptions receivable at September 30, 2008 was $47,769.

Nexia Holdings, Inc. through a board resolution dated July 2, 2008 authorized a one for one thousand reverse stock split effective on July 25, 2008. The Company’s Common Stock with a par value of $0.0001 will retain the number of authorized shares of Common Stock at 5,500,000,000. There were 2,362,995,732 shares of common stock outstanding on the date of the reverse stock split. As of August 14, 2008 there were 2,482,922 shares outstanding.

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NOTE 5 - RELATED PARTY TRANSACTIONS

In 2007 and 2008, the President of the Company advanced $123,587 as a short-term, interest-free advance for the purchase of inventory and operational expenses which remains outstanding as of September 30, 2008. In addition, $142,202 of accrued interest was owed to the President of the Company as of September 30, 2008 for interest earned on past related party loans and $379,112 in unpaid salaries. There are notes owed to the President of the Company totaling $255,414. One note was issued to the President of the Company for $250,000 on July 13, 2006, with an interest rate of 24%. The payments are due each year on June 20th for $50,000 plus interest with a maturity date of November 20, 2011. There are currently two payments plus interest past due. The second note was issued to the President of the Company for $31,025 on November 7, 2006, with an interest rate of 20%. There was one payment due for the entire note with interest on January 25, 2007 and was later agreed to be extended until September 30, 2007. The amount owed on the note as of September 30, 2008 is $5,414 and is currently due in full.

The Company issued 38,600,000 restricted common shares on August 14, 2008, valued at $1,344,000 to Diversified Holdings X, Inc., a related party for payment in full for a note and accrued interest in the amount of $385,728 owed by Gold Fusion. The restricted shares, as of September 30, 2008, held a value of $378,280.

NOTE 6 - INVESTMENT IN MARKETABLE EQUITY SECURITIES

The following is a summary of the Company's investment in available-for-sale securities as of September 30,
2008 and December 31, 2007:

		September 30,			December 31,
		2008			2007
Equity securities, free trading:

Gross unrealized gains		$	946		$	2,227

Gross unrealized losses			(4,351	)		(821,783	)

Net unrealized loss		$	(3,405	)	$	(819,556	)

Fair market value		$	177,510		$	195,499


Change in the unrealized loss on available-for-sale securities during the nine months ended September 30, 2008
is as follows:

	Beginning balance	$	(819,556	)
	Decrease in unrealized holding loss		816,151

	Ending balance	$	(3,405	)

The Company recognized an other-than-temporary loss on its investments during the nine months ended September 30, 2008 and 2007 in the amount of $785,285 and $0, respectively. Gross realized losses were $56,014 from the sale of marketable securities during the nine months ended September 30, 2008 that was based on the specific identification of the securities sold. Proceeds from the sales were $32,361.

NOTE 7 - INVENTORY

The Company calculates its inventory on a first-in, first-out basis. Below shows the inventory broken out by class:

	September 30,		December 31,
	2008		2007

Raw Materials	$	1,025	$	20,529

Work in Process		-		41,454

Finished Goods		132,480		271,698

Total Inventory	$	133,505	$	333,681

NOTE 8 - SEGMENT INFORMATION

Nexia Holdings, Inc has three reportable segments in which it operates using the guidelines set forth in SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information”. The reportable segments are as follows: Salon businesses; the Black Chandelier clothing manufacturing and retail sales operations and Real Estate and General including the purchase, sale and rental of commercial real estate.

Summarized financial information concerning reportable segments is shown in the following table:

	Period Ended							Real Estate
	September 30,	Salons			Retail			& General			Total

Revenues	2008	$	1,640,125		$	313,162		$	150,178		$	2,103,465
	2007		1,433,666			663,945			174,256			2,271,867


Net income (loss) applicable to	2008		129,215			(946,509	)		(3,882,599	)		(4,699,893	)
segment	2007		(58,951	)		(772,542	)		(2,461,701	)		(3,293,194	)


Total assets	September 30, 2008		546,853			(1,514,387	)		5,573,698			4,606,164
(net of intercompany accounts)	December 31, 2007		427,594			391,841			4,026,050			4,845,485

NOTE 9 – INTERCOMPANY RESTRUCTURING

On April 24, 2008, a Board resolution approved a stock transfer agreement with Green Endeavors, Ltd (“Green Endeavors”), a 90% owned subsidiary of the Company, where the Company and its wholly-owned subsidiary, Diversified Holdings I, Inc., would each sell their holdings in Landis Salons, Inc. and Newby Salon LLC in exchange for an 8% Series A Senior Subordinated Convertible Debenture with a face amount of $3,000,000. The Board has been informed and approved the price for the 85% interest in Landis Salons, Inc. and the 100% interest in Newby Salon, LLC as fair and reasonable. The Company plans for Green Endeavor to become traded on the Over The Counter Bulletin Board. The Company may also spin off Green Endeavors on a pro-rata basis to the holders of Nexia’s common stock.

NOTE 10 - SUBSEQUENT EVENTS

Subsequent to September 30, 2008, the Company issued 20,000,000 shares of common stock under its 2008 benefit plan as follows:

Issuance of 10,000,000 common shares for options exercised - issued to one employee for past services valued at $10,000. Issuance of 10,000,000 common shares - issued to two contractors for services rendered valued at $10,000.

On October 10, 2008 the Company signed a consulting contract with Clearvision, Inc. to provide promotional services through its media outlets for 400,000 of the Company’s Series C Preferred Stock valued at $2,000,000.

On October 13, 2008 the Company signed an agreement to purchase a residential house in Bountiful, Utah for 100,000 Series C Preferred shares valued at $500,000.

October 20, 2008 the Board of Directors authorized the issuance of 20,000 Series C Preferred Stock to an employee and consultant for services rendered and valued at $100,000.

On October 24, 2008 the Company authorized the President of the Company to convert 50,000 shares of Series A Preferred Stock into 500,000,000 shares of restricted common stock.

On October 24, 2008 the Company approved the conversion of Series C Preferred Stock by four employees of the Company into 117,000,000 shares of common stock.

On October 27, 2008 the Board of Directors authorized the issuance of 10,000 Series C Preferred Stock to a contractor for services received. The stock is valued at $50,000.

On October 31, 2008 the Board of Directors authorized the issuance of 30,000 Series C Preferred Stock to a consultant for services to be provided. The stock is valued at $150,000.

On November 3, 2008, Wasatch Capital Corporation, a subsidiary of Nexia Holdings, Inc., entered into a Real Estate Purchase Contract with Bandaloops, LLC to sell its ownership interest in the Wallace/Bennett Buildings located at 59 West 100 South, Salt Lake City, Utah. The sale is for a total sales price of $2,150,000 which shall be satisfied under the following terms: Wasatch will finance $1,145,000 in an All Inclusive Trust Deed and Note that mirrors the two existing mortgages on the property, a 10-year note in the amount of $105,000 and interest of 5% will be secured in the property, Wasatch will retain the right to occupy all areas of the building except the first floor for the first year at a rent of $123,648 paid at the closing and hold an option to rent space for two additional years at a rent of $8.00 per square foot triple net. Vasilios Priskos will personally guarantee the promissory note to Wasatch. Wasatch will participate in any future sale of the property if the property is sold for a premium over its purchase price. Wasatch will be entitled to a premium on the $105,000 promissory note in the same percentage as the new sales price exceeds the current sales price, 50% increase in price will result in a 50% premium on the note. Sale closed on November 11, 2008.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Cautionary Statement Regarding 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 Nexia to continue its business strategy, changes in the real estate markets, labor and employee benefits, as well as general market conditions, competition, and pricing. Although Nexia 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-Q 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 Nexia or any other person that the objectives and plans of Nexia will be achieved.

General

Nexia's current operations consist of three principal areas: (1) operation of the design and retail operations of Black Chandelier fashion lines through the Company’s subsidiary Style Perfect, Inc. (SPI); (2) the operation of Landis Lifestyle Salons through Nexia’s ownership interest in Green Endeavors, Ltd. (GRNE) which holds an 85% ownership interest in Landis Salons, Inc. and 100% ownership of Newby Salon, LLC and (3) the acquisition, leasing and selling of real estate. The following discussion examines Nexia's financial condition as a result of operations for the three and nine month periods ended September 30, 2008 and compares those results with the comparable periods in 2007.

Style Perfect Retail Operations

During the second quarter of 2008, Nexia Holdings, Inc. exercised its secured interest in the assets of Gold Fusion Laboratories, Inc. and took possession of all known assets, including inventory, production equipment and all store fixtures and accessories. The two remaining retail locations of Gold Fusion continued in operation and all operations were assigned by Nexia to a new subsidiary corporation named Style Perfect, Inc. The Trolley Square location was closed recently and only the Gateway store remains in operation as a physical location. The online operations and the retail store are both operating under the trade name of Black Chandelier.

Black Chandelier operations as of September 30, 2008 include one retail outlet operated under the Black Chandelier label, at the Gateway Shopping Center (Salt Lake City, Utah), as well as the online shopping site, www.blackchandelier.com.

Gold Fusion/Style Perfect combined had sales of $41,245 and $313,162 during the three and nine months ended September 30, 2008 compared to Gold Fusion revenues of $177,890 and $663,945 for the same periods in 2007. The decrease in the three and nine month revenues of $136,645 and $350,783, or 77%, 53% respectively, was a result of the three stores that were closed in the first six months of 2008.

Net losses for Gold Fusion/Style Perfect combined operations were $199,312 and $946,509 for the three and nine month periods ended September 30, 2008 compared to Gold Fusion net losses of $240,227 and $772,542 for the same periods in 2007. The decrease in losses for the three months ended September 30, 2008 compared with the same period in 2007 was $40,915 or 17%. It was due to four store locations in operation during 2007 and only one store currently in operation as of September 30, 2008. The Company closed three of the stores to further reduce losses in unproductive locations. The increase in losses for the nine months ended September 30, 2008 compared to 2007 was $173,967, or 23%, and was caused by the write-down of property and equipment, inventory, and leasehold improvements during 2008 from closing three store locations.

Black Chandelier is a lifestyle company that produces clothing, candles and active wear. The mission of Black Chandelier is to offer products designed with deliberateness and wild inspiration that indulge an individual’s innate drive to be unique. The overarching concept is to provide the consumer with an affordable alternative to “mass-market” offerings by extending a product that conveys a sense of eccentricity that stands apart in quality, style and price, from most of the homogenous fare being offered consumers by the mainstream apparel market. The clothing items are produced in small runs keeping merchandise offered in the stores fresh. Style Perfect is in the process of retooling its product lines and has recently hired a new designer to assist in the redesign of certain products.

Landis Salon Operations

Nexia’s majority owned subsidiary Green Endeavors LTD currently owns 85% of Landis Salons, Inc. (“Landis”). In November 2005, the Company acquired a 20% equity interest in Landis for a $100,000 cash payment. Landis operates an AvedaTM Lifestyle salon that features AvedaTM products for retail sale.

Landis Salon has two locations, one in Salt Lake City, Utah and the other in Bountiful, Utah. They reported revenue of $519,393 and $1,640,125 during the three and nine months ended September 30, 2008 compared to $533,667 and $1,433,666 for the same period in 2007. The increase in revenue for the nine months ended September 30, 2008 compared to 2007 of $206,459, or 14%, came from the growth in customer base at the Salt Lake City location and the addition of a new store in Bountiful in the second half of 2007. The decrease in sales for the three months ended September 30, 2008 compared with the same period in 2007 of $14,274, or 3%, was a result of turnover of stylist employed at the salons.

Net income for Landis operations was $42,445 and $129,215 for the three and nine month periods ended September 30, 2008 compared to net losses of $50,009 and $58,951 for the same three and nine month periods in 2007. The increase in net income for the three and nine months ended September 30, 2008 compared to the same period of 2007 was $92,454 and $188,166 or 185% and 319%, due to increased sales at the Salt Lake location and better control over both locations’ operating expenses.

Additional information on the Landis Salon can be found on its website at www.landissalons.net.

Real Estate Operations

Nexia's objective, with respect to real estate operations, is to acquire, through subsidiaries, properties which management believes to be undervalued and which Nexia is able to acquire with limited cash outlays. Nexia will consider properties anywhere within the continental United States. Nexia attempts to acquire such properties by assuming existing favorable financing and paying the balance of the purchase price with nominal cash payments or through the issuance of shares of common stock. Once such properties are acquired, Nexia leases them to primarily commercial tenants. Nexia also makes limited investments to improve the properties with the objective of increasing occupancy and cash flows. Management believes that, with limited improvements and effective management, properties can be sold at a profit within a relatively short period of time. Nexia currently operates three real estate subsidiaries: Wasatch Capital Corporation, Downtown Development Corporation and Kearns Development Corporation.

Nexia recorded rental revenues of $46,940 and $150,178 for the three and nine months ended September 30, 2008 as compared to $51,109 and $174,256 for the comparable periods in 2007. The decrease in the three and nine month rental revenues of $4,169 and $24,078 or 8% and 14% was due to the loss of the only tenant at the Kearns Building at the end of March in 2008.

Nexia had net external losses from real estate operations of $51,787 and $86,192 for the three and nine months ended September 30, 2008, compared to losses of $13,051 and $43,531 for the comparable periods in 2007. The increase in the three and nine month losses of $38,736 and $42,661, or 297% and 98%, is attributable to the loss of the only tenant at the Kearns building at the end of March 2008. The Company has accrued additional late fees for not making the mortgage payments on the Kearns building.

Nexia will continue efforts to improve profitability and cash flow by working to increase occupancy and rental income from those properties currently held and to seek new investment opportunities as they can be located and evaluated. Accordingly, Nexia hopes to not only minimize any real estate cash flow deficit, but also generate sufficient cash to record a substantial profit upon property disposition. Downtown Development currently has the Downtown building under contract to be sold. A contract to sell the Kearns building did not close. The mortgage on the Kearns building is currently in default. The Company is working on some funding to bring the mortgage payments current and to continue to try to sell the building.

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Company Operations as a Whole:

Revenue

Gross revenues for the three and nine month periods ended September 30, 2008, were $607,678 and $2,103,465 as compared to $762,666 and $2,271,867 for the same periods in 2007. The decrease in the three and nine months ended September 30, 2008 compared with the same period in 2007 of $154,988 and $168,402, or 20% and 7% is due to a tenant leaving one of our buildings at the end of March in 2008 and the closing of three Black Chandelier retail stores in the first six months of 2008.

Operating Losses

Nexia recorded operating losses of $1,805,703 and $3,475,819 for the three and nine month periods ended September 30, 2008, compared to losses of $1,239,648 and $3,382,903 for the comparable periods in the year 2007. The increases in three and nine month operating losses of $566,055 and $92,916, or 46% and 3%, was the result of decreased revenue from closing three retail locations and losing a tenant in one of the buildings. There have also been write downs of inventories in the amount of $15,000, and abandoning leasehold improvements at the retail locations that were closed during the year in the amount of $232,385. Change to Net income explanation.

Net Loss

Nexia recorded net losses of $1,861,552 and $4,699,893 for the three and nine month periods ended September 30, 2008, as compared to net losses of $1,272,214 and $3,288,803 for the comparable periods in 2007. The increase in losses for the three and nine months ended September 30, 2008 was $589,338 and $1,411,090, or 46% and 43%, compared to the same period in 2007. This increase was created by realizing nonrecurring losses in marketable equity securities valued at $785,285 during the first quarter of 2008, writeoffs of inventories, abandoned leasehold improvements, and a decrease in revenues from the Fashion retail division.

Nexia may not operate at a profit through fiscal 2008. Since Nexia's activities are tied to its ability to operate its retail and salon operations and real estate properties at a profit, future profitability or its revenue growth tends to follow changes in the markets for these activities. There can be no guarantee that profitability or revenue growth can be realized in the future.

Expenses

General and administrative expenses for the three and nine month periods ended September 30, 2008, were $2,012,441 and $3,724,171 compared to $1,559,506 and $3,931,863 for the same periods in 2007. The increase in three month expenses of $452,935, or 29%, was created by a payment of restricted stock to reduce debt in excess of the debt value. The decrease in the nine month expenses of $207,692, or 5%, was due primarily to reducing the amount of outside services being paid for with stock, reduction in promotional costs, reduced payroll expenses and a decrease in cost from closing three Black Chandelier stores.

Depreciation and amortization expenses for the three and nine months ended September 30, 2008, were $42,113 and $130,354 compared to $63,636 and $169,271 for same periods in 2007. The decreases in the three and nine month expenses of $21,523 and $38,917, or 34% and 23%, were attributable to two properties that are being held for sale and that did not receive any depreciation in the first nine months of 2008. There were also write downs and impairments of property and equipment values at March 31, 2008 of $294,733.

Capital Resources and Liquidity

On September 30, 2008, Nexia had current assets of $1,317,144 and $4,606,164 in total assets compared to current assets of $1,036,555 and total assets of $4,845,485 as of December 31, 2007. Nexia had net working capital deficit of $1,915,510 at September 30, 2008, as compared to a net working capital deficit of $1,694,448 at December 31, 2007. The increase in working capital deficit of $221,062 is due primarily from increases in accounts payable, accrued liabilities, and a reduction in inventory and cash.

Cash used by operating activities was $123,731 for the nine months ended September 30, 2008, compared to cash used by operating activities of $538,177 for the comparable nine month period in 2007. The decrease in cash used of $414,446 was attributable mostly to a larger net loss of $4,699,893, offset by a non-recurring marketable securities write-down of $785,285 and the issuance of stock options expensed in the amount of $257,905. Service and contract agreements were paid for with stock valued at $1,063,913 and restricted common stock was issued in excess of the debt amount to pay off a debt. There were also amortization expenses of Series C shares in the amount of $671,875 during 2008.

Net cash used in investing activities was $34,629 for the nine months ended September 30, 2008, compared to net cash used by investing activities of $251,241 for the nine months ended September 30, 2007. The decrease of cash used in the sum of $216,612 was attributable primarily to the decrease in purchases of capital assets for the first nine months of 2008 compared to the same period of 2007. There was also a disposal of capital assets in 2008, while there were none in 2007.

Cash provided by financing activities was $77,218 for the nine months ended September 30, 2008, compared to cash provided of $680,364 for the nine months ended September 30, 2007. The decrease of $603,146 was due primarily to larger proceeds from stock subscriptions during the first half of 2007. There were also more proceeds from notes payable during 2007.

Nexia may experience occasional cash flow shortages due to debt service on real estate holdings and willingness to acquire properties with negative cash flow. To cover these shortages, Nexia may need to issue shares of its common stock in payment for services rendered. The Company is currently experiencing challenges with regard to cash flows. We are looking at several options to improve this situation, including having signed for an equity line of credit with Dutchess Private Equities Fund. The agreement with Dutchess provides that, following notice to Dutchess, Nexia may put to Dutchess up to $10 million in shares of our common stock for a purchase price equal to 95% of the lowest closing best bid price on the Over-the-Counter (“OTC”) Bulletin Board of our common stock during the five day period following that notice. The number of shares that we will be permitted to put pursuant to the agreement will be either: (a) 200% of the average daily volume of our common stock for the ten trading days prior to the applicable put notice, multiplied by the average of the three daily closing “best bid” prices immediately preceding the day we issue the put, or (b) $100,000; provided that in no event will the put amount be more than $1,000,000 with respect to any single put. (Best Bid is a defined term in the agreement as the highest posted bid price for the common stock.) In turn, Dutchess has indicated that it will resell the shares of common stock in the open market, resell our shares to other investors through negotiated transactions or hold our shares in its portfolio. These shares are made the subject of an S-1 Registration Statement that has not yet been declared effective and for which the Company is currently drafting an amendment.

Stock and Options To Employees and Contractors

Nexia’s subsidiary, Diversified Holdings I, Inc., relied on the issuance of Nexia common stock, under Nexia’s S-8 Registration Statements and 2008 Employee Benefit Plan, for a large portion of employee salary and contractor payments during the nine months ended September 30, 2008. The Company issued, pursuant to S-8 Registration Statements, 28,410,900 shares as compensation to twenty persons in exchange for services provided to the Company. The total number of common shares issued was 78,388,600. The value of these services and payment of a debt in excess of the debt value expensed during the nine months ended September 30, 2008 was $2,559,716. If the Company stock is sold for more than the value when issued, paid-in capital will be increased. If the Company stock is sold for less than the value when issued, paid-in capital will be reduced.

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Impact of Inflation

Nexia believes that inflation has had a negligible effect on operations over the past three years. Nexia believes that it can offset inflationary increases in the cost of materials and labor by increasing sales and improving operating efficiencies.

Off Balance Sheet Arrangements

We do not have any off-balance sheet financing arrangements.

Known Trends, Events, or Uncertainties

General Real Estate Investment Risks

Nexia's investments are subject to varying degrees of risk generally incident to the ownership of real property. Real estate values and income from Nexia's current properties may be adversely affected by changes in national or local economic conditions and neighborhood characteristics, changes in interest rates and in the availability, cost and terms of mortgage funds, the impact of present or future environmental legislation and compliance with environmental laws, the ongoing need for capital improvements, changes in governmental rules and fiscal policies, civil unrest, acts of God, including earthquakes and other natural disasters which may result in uninsured losses, acts of war, adverse changes in zoning laws and other factors which are beyond the control of Nexia.

Value and Illiquidity of Real Estate

Real estate investments are relatively illiquid. The ability of Nexia to vary its ownership of real estate property in response to changes in economic and other conditions is limited. If Nexia must sell an investment, there can be no assurance that Nexia will be able to dispose of it in the time period it desires or that the sales price of any investment will recoup the amount of Nexia's investment.

Property Taxes

Nexia's real property is subject to real property taxes. The real property taxes may increase or decrease as property tax rates change and as the property is assessed or reassessed by taxing authorities. If property taxes increase, Nexia's operations could be adversely affected.

ITEM 3. CONTROLS AND PROCEDURES

Nexia'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 Nexia. 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 Nexia's disclosure controls and procedures (as defined in Rule 13a-14(c) under the Securities Exchange Act of 1934) are not effective and adequate in areas disclosed below.

As of the end of the quarter covered by this report, the Company conducted an evaluation, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, of the Company’s internal control, disclosure controls, and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the 1934 Act. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that there were a number of adjusting entries initiated by the Company after the auditors’ field work was completed. This is evidence of material deficiencies in the Company’s disclosure controls and procedures. The Company also performed procedures in completing these financial statements for the period ended September 30, 2008 to ensure that the amounts and disclosures included were fairly presented in all material respects in accordance with GAAP.

This quarterly report does not include an attestation report of the Company’s registered public accounting firm regarding internal controls over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to the temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this quarterly report.

Nexia is currently designing procedures to test and validate the quality of our internal controls. Management will take measures at the end of each quarter in 2008 to review the numbers carefully for errors and adjustments, if needed. We perform inventory counts at each quarter and adjust inventory accordingly. Accounting personnel look for discrepancies from our pre-count inventory numbers and our post-count numbers and fix weaknesses in the control process. We balance our bank statements to our daily sales and deposits made to verify sales are being recorded correctly, and cash and inventory are secured from most kinds of fraud. All checks are signed and approved by Richard Surber, the President and CEO of the Company. He is the only signer on all bank accounts. All use of credit cards is approved by Richard Surber, and they are usually used for payment of bills. Someone in accounting, other than those authorized to use the credit cards, reconciles the balances.

We review each account balance for all subsidiaries in the consolidation, after we have completed recording all transactions and adjusting balances. This is done to verify that the accounts reflect the correct balance and that required adjustments have been made. We are working to improve our procedures in this area.

In conclusion management has found a material weakness in its internal controls and procedures. Management’s goals are to make the changes stated above, along with others that management may find necessary, and to complete a written, comprehensive document on our internal control and management procedures.

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PART II-OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Since the filing of Nexia's 10-K for the period ended December 31, 2007 and its 10-Q for the period ended June 30, 2008, no material changes have occurred to the legal proceedings reported therein. For more information, please see Nexia's Form 10-K for the year ended December 31, 2007 filed May 16, 2008 and its Form 10-Q for the quarter ended June 30, 2008 filed August 19, 2008.

ITEM 2. UNREGISERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On August 14, 2008, the Company authorized the delivery to Diversified Holdings X, Inc. of Thirty Eight Million Six Hundred Thousand (38,600,000) restricted shares of the Corporation’s Common Stock. The issuance represents compensation and satisfaction of a promissory note in the face amount of $300,000 made by Gold Fusion Laboratories, Inc. that was made payable to Diversified Holdings X, Inc. a corporation wholly owned by Richard Surber, the CEO of the Company. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933. This issuance will settle the debt in the current amount of $385,728 and remove the obligation as a current debt.

On September 8, 2008, the Company authorized the delivery to Taylor R. Gourley of Twenty Thousand (20,000) shares of the Corporation’s series C Preferred Stock. The issuance represents compensation for providing or obtaining promotional services for the benefit of the Company. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On September 9, 2008, the Company authorized the delivery to Shauna Postma of Ten Thousand (10,000) shares of the Corporation’s Series C Preferred Stock. The issuance represents compensation for services provided to the Company as an employee in the accounting department. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

SUBSEQUENT EVENTS

On October 3, 2008, the Company authorized the delivery of 10,000 restricted shares of its Series C Preferred Stock to Fredrick W. Hunzeker and 10,000 restricted shares of its Series C Preferred Stock to AmeriResource Technologies, Inc. The shares were issued in exchange for providing promotional services for the benefit of the Company. The transactions were handled as private sales exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On October 10, 2008, the Company authorized the delivery to Clearvision, Inc. of Four Hundred Thousand 400,000 shares of the Corporation’s series C Preferred Stock. The issuance represents compensation for providing for promotional services for the benefit of the Company. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On October 13 2008 the Company entered into a contractual obligation to Mr. Mark Parkinson to issue to him a total of One Hundred Thousand 100,000 restricted shares of Series C Preferred Stock. The issuance of 100,000 shares represents satisfaction of the Real Estate Purchase Agreement with Mr. Parkinson to acquire real property located in Bountiful, Utah. The transaction was handled as a private sale to an accredited investor, exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On October 27, 2008, the Company authorized the delivery to Richard N Smith of Ten Thousand 10,000 shares of the Corporation’s series C Preferred Stock. The issuance represents compensation for providing accounting services for the benefit of the Company. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On October 31, 2008, the Company authorized the delivery of 30,000 restricted shares of its Series C Preferred Stock to R. Chris Cottone. The shares were issued in exchange for providing consulting services for the benefit of the Company. The transactions were handled as private sales exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

ITEM 3 DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

ITEM 5. OTHER INFORMATION

On August 14, 2008, the Company authorized the delivery to Almar Capital Advisors, LLC and RES Holdings Corp of 333,400 shares of restricted common stock pursuant to a consulting agreement between the Company and the named parties. The consultants will provide assistance in locating financing and other management advice over the course of the contract’s term of one year. The transaction was handled as a private sale exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.

On September 30, 2008 the Company and Clearvison Inc. entered into a Limited Consulting Contract that provided for Clearvision to receive a total of 400,000 shares or Series C Preferred Stock in exchange for providing a plan to enhance the Company’s image in the public markets for fashion and beauty, including obtaining celebrity endorsements for the Company’s services and products. Clearvison will also arrange for media placements and promotional actions to be taken to further promote the Company’s image and business operations.

SUBSEQUENT EVENTS

On October 24, 2008, the Company approved the conversion of Series C Preferred Stock by four employees of the Company into 117,000,000 shares of common stock, all of the C shares had been held for a period in excess of six months.

On October 24, 2008, the Company authorized the delivery to Richard D. Surber of Five Hundred Million (500,000,000) restricted shares of the Corporation’s Common Stock. The issuance represents the conversion of 50,000 shares of Series A Preferred Stock held by Mr. Surber.

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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 25 of this Form 10-Q, and are incorporated herein by this reference.
	(b)	Reports on Form 8-K During the period covered by this report, Nexia filed 5 Form 8-K reports.

	(1)	On July 10, 2008, the Company filed a Form 8-K reporting on the 1 for 1,000 reverse stock split of the common stock of the Company authorized by the board of directors and a majority of the voting shareholders.
	(2)	On July 24, 2008, the Company filed a Form 8-K reporting on the resignation of Hansen Barnett & Maxwell as the Company’s certifying accountant.
	(3)	On July 28, 2008, the Company filed a Form 8-K amending the report of July 24, 2008 reporting on the resignation of Hansen Barnett & Maxwell as the Company’s certifying accountant.
	(4)	On July 30, 2008, the Company filed a Form 8-K reporting on the hiring of the accounting firm of Madsen & Associates CPA’s, Inc. as the Company’s new certifying accountant.
	(5)	On August 15, 2008, the Company filed a Form 8-K reporting on the issuance of 38,600,000 unregistered shares of restricted common stock to Diversified Holdings X, Inc. as satisfaction of a promissory note in the face amount of $300,000 owed by Gold Fusion Laboratories, Inc. and the issuance of 333,400 shares of restricted common stock to Almar Capital Advisors, LLC and RES Holding Corp. pursuant to a consulting agreement between the Company and the named parties, both issuances were made in private sales exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933.
	(6)	On September 9, 2008, the Company filed a Form 8-K reporting on the issuance of 20,000 unregistered shares of Series C Preferred Stock to Taylor R. Gourley as compensation for services to the Company and 10,000 unregistered shares of Series C Preferred Stock to Shauna Postma as compensation for services to the Company, both issuance were made in private sales exempt from registration under Rule 506 of Regulation D and the Securities Act of 1933. The Company also reported on 8 agreements entered into by the Company to issue a total of 40 million shares pursuant to the Company’s S-8 Registration Statement.

Subsequent to the end of the quarter ended September 30, 2008, Nexia has filed 3 Form 8-K reports

	(1)	On October 8, 2008, the Company filed a Form 8-K reporting on the adoption of a New Real Estate Investment Strategy.
	(2)	On October 28, 2008, the Company filed a Form 8-K reporting on the conversion of 50,000 shares of Series A Preferred Stock by Richard Surber into 500 million shares of restricted common stock and the conversion of Series C Preferred Stock into 117 million shares of common stock by four employees.
	(3)	On November 6, 2008, the Company filed a Form 8-K reporting on the sale of the Wallace/Bennett buildings by Wasatch Captial Corporation, a subsidiary of the company. The sale price was $2,150,000 and will result in both a cash payment and a note to be carried by Wasatch for the balance of the purchase price.

Table of Contents

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, this 14th day of November, 2008.

	Nexia Holdings, Inc.

Date: November 14, 2008	By:	/s/ Richard Surber
		Richard Surber President and Director

Table of Contents

INDEX OF EXHIBITS
Exhibit No.	Exhibit Page No.	Description
3(i)(a)	*	Articles of Incorporation of the Company in Colorado, 1987. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(i)(b)	*	Articles of Amendment to change the name of the Company. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(i)(c)	*	Articles of Incorporation of Kelly’s Coffee Group, Inc. filed with the Secretary of State of Nevada on August 3, 2000. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(i)(d)	*	Articles of Merger merging Kelly’s Coffee Group, Inc., a Colorado Corporation into Kelly’s Coffee Group, Inc., a Nevada Corporation, filed with the Secretary of State of Colorado on September 22, 2000, and with the Secretary of State of Nevada on October 5, 2000. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(i)(e)	*	Restated Articles of Incorporation of the Company. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(i)(f)	*	Amendment to the Articles of Incorporation changing the Company’s name from Kelly’s Coffee Group, Inc. to Nexia Holdings, Inc. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
3(ii)	*	Bylaws of Nexia Holdings, Inc. (Incorporated by reference to the Company’s Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
4	*	Form of certificate evidencing shares of "Common Stock” in the Company. (Incorporated by reference to the Company's Form SB-2 as filed with the Securities and Exchange Commission on January 12, 2006).
10(i)	*	February 1, 2007 Consulting Agreement with Target IR of Bigfork, Montana to provide services including marketing, strategic planning and financial matters for a period of one month in exchange for a cash payment in the sum of $50,000. (Incorporated by reference from the 10-KSB for the year ended December 31, 2006 filed by the Company on April 19, 2007.)
10(ii)	*	April 10, 2007 Consulting Agreement with Target IR of Bigfork, Montana to provide services including marketing, strategic planning and financial matters for a period of two months in exchange for a cash payment in the sum of $50,000. (Incorporated by reference from the 10-KSB for the year ended December 31, 2006 filed by the Company on April 19, 2007.)

31.1	28	CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.

31.2	29	CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002.

32	30	CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002.

Other

99(lix)	*	July 17, 2008, a Stock Option Agreement between the Company and Guy Cook granting 40,150,000 options with an option set at 50% of the market price at the time of exercise, all of the options vested immediately. (Incorporated by reference from the 10-Q for the period ended June 30, 2008 filed by the Company)

99(lx)	31	September 9, 2008, a Stock Option Agreement between the Company and Shauna Postma granting 100,000 options with an option set at 50% of the market price at the time of exercise, all of the options vested immediately.

99(lxi)	33	September 9, 2008, a Stock Option Agreement between the Company and Pamela Hyde granting 100,000 options with an option set at 50% of the market price at the time of exercise, all of the options vested immediately.

99(lxii)	35	September 9, 2008, a Stock Option Agreement between the Company and Fredrick Hunzeker granting 500,000 options with an option set at $0.25 per share at the time of exercise, all of the options vested immediately. (The board of directors later awarded the same number of shares without an option price on the 500,000 shares.)

99(lxiii)	37	September 9, 2008, a Stock Option Agreement between the Company and John Mortensen granting 500,000 options with an option set at $0.25 per share at the time of exercise, all of the options vested immediately. (The board of directors later awarded the same number of shares without an option price on the 500,000 shares.)

99(lxiv)	39	September 9, 2008, a Stock Option Agreement between the Company and Michael Golightly granting 500,000 options with an option set at $0.25 per share at the time of exercise, all of the options vested immediately. (The board of directors later awarded the same number of shares without an option price on the 500,000 shares.)
Subsequent Events

EX-31.1 2 ex31_1.htm EXHIBIT 31.1 ex31_1.htm

Exhibit 31.1

Certifications

I, Richard Surber, certify that:

1. I have reviewed this quarterly Report on Form 10-Q of Nexia Holdings, 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 small business issuer as of, and for, the periods presented in this report;

4. The small business issuer's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:

(a) 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 small business issuer, 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;

(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 small business issuer’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

(d) Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

5. The small business issuer's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, , to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

(a) 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 small business issuer’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date: November 14, 2008


/s/ Richard Surber Richard Surber the President and Chief Executive Officer of Nexia Holdings, Inc.

EX-31.2 3 ex31_2.htm EXHIBIT 31.2 ex31_2.htm

Exhibit 31.2

I, Richard Surber, certify that:

1. I have reviewed this quarterly Report on Form 10-Q of Nexia Holdings, Inc.;

5. The small business issuer's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions):

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.

Date: November 14, 2008


/s/ Richard Surber Richard Surber Chief Financial Officer of Nexia Holdings, Inc.

EX-32 4 ex32.htm EXHIBIT 32 ex32.htm

Exhibit 32

CERTIFICATIONS

I, Richard Surber, Chief Executive Officer of Nexia Holdings, Inc. (the “Registrant”), do hereby certify, pursuant to 18 U.S.C. ' 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:

(1) The Quarterly Report on Form 10-Q of the Registrant, to which this certification is attached as an exhibit (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Registrant.

/s/ Richard Surber

Richard Surber

Chief Executive Officer

November 14, 2008

I, Richard Surber, Chief Financial Officer of Nexia Holdings, Inc. (the “Registrant”), do hereby certify, pursuant to 18 U.S.C. ' 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, based on my knowledge:

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Registrant.

/s/ Richard Surber

Richard Surber

Chief Financial Officer

November 14, 2008

Exhibit 10(iii)

CLEARVISION INC.

1041 N. Formosa Ave., Los Angeles, CA 90046 * t: 323-850-2988 * f: 323-850-2989

Limited Consulting Contract

This Agreement is made between

NEXIA HOLDINGS INC

(hereinafter “CLIENT”)

and

CLEARVISON INC.

(hereinafter “CVI”).

In consideration for the promises contained herein and other good and valuable considerations, it is agreed as follows:

Independent Contractor Status

Parties to this contract intend that the relationship between them created by the contract is that of CLIENT and independent contractor. No agent, employee or servant of the independent contractor shall be, or shall be deemed to be, an employee, agent, or servant of the employer. CLIENT is interested only in the results obtained under this contract; the manner and means of conduct of the work are under the sole control of the independent contractor. None of the benefits provided by the CLIENT to its employees, including, but not limited to, compensation, insurance and unemployment insurance will be available to the contractor, or its employees. Independent contractor will be solely and entirely responsible for its acts and for the acts of its agents, employees, servants, and subcontractors during the performance of this contract. Within this Agreement, the use of the name CLIENT shall mean CLIENT itself, or employees, agents or other CVI’s employed by CLIENT.

Statement of Contract Intent

Throughout this Agreement and the term of this Agreement, CVI will be engaged in consulting and corporate development on an independent contractor basis. CVI will derive its revenues and any other compensation from consulting fees charged CLIENT.

CLIENT and CVI agree to enter into a Limited Consulting Contract.

It is the intent of CLIENT and the CVI, evidenced by their signatures hereto, to employ and provide the services described herein.

Duties to be Performed

1.	Develop and identify relationships for the CLIENT through networking and pre-existing relations of CVI to further CLIENT’S image and recognition as a leader in the fashion and beauty industry.

2.	CVI may use its best professional judgment in hiring or contracting personnel to perform the duties specified in this Agreement.

3.	Specify a plan to enhance CLIENT’S image in the public market place with research reports.

4.	CVI will gather and amass such data and information (due diligence) as necessary to implement CLIENT’S strategies and monitor results.

5.	CVI shall develop strategic alliances with business and industry partners on behalf of CLIENT that enhance or further advance the business of CLIENT in conjunction with CLIENT’S milestones.

6.	CVI shall develop marketing strategies, techniques, methods, procedures and materials as needed for continued advancement of CLIENT’S corporate mission statement.

7.	Other such duties and responsibilities as may be mutually agreed upon by the parties and made part of this Agreement by signed amendments or addenda, including but not limited to the following Media campaign package.

8.	Provide a celebrity endorsement for the CLIENT, subject to the CLIENT’S approval of celebrity.

9.	CLIENT will pay any and all fee, airfare, hotel, ground transportation and per diem associated with out of state travel for any celebrity spokesperson.

Definitions:

·	VNR: a broadcast-quality 5-8 minute narrated Video News Release, followed by up to 13 minutes of B-Roll and Sound Bites, distributed via Satellite and Beta Broadcast Masters for inclusion on national and local news programs and talk shows.

·	Newspaper Feature: 1-3 column news article with photo and contact info distributed to over 10,000 newspapers (mainly major market dailies and weeklies), reaching over 20 million readers (est.).

·	RNR: 60 second Radio News Release professionally recorded and distributed in script form and on CD to 6,600 radio stations for use on regular news and talk shows.

Whereas CVI have offered their services to the CLIENT, and the CLIENT has chosen to hire CVI to perform these services;

For mutual consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to as follows:

1.	PRODUCTION GUARANTEES

CVI will provide productions for CLIENT: Video News Release (VNR), Corporate Video (up to 10-min, Tradeshow Loop Presentation, Internet Streaming Video, Newspaper Feature, and RNR. Productions include complete Scripting (two drafts and a polish per Feature) to CLIENT’S approval; up to four days of Shooting – including locations approved by CLIENT and on a state-of-the-art sound stage and news set in Holloywood CA; Emmy winning news anchors; on-camera news reporter; Voice-over narration; unlimited Stock Footage from in-house library (17 years worth of archived production footage); Complete Post Production/Editing with Graphics; Digital Editing; Production Insurance, CVI’s local Location and Travel expenses and Per Diem, Director and Producer Fees; printing, postage and mailing, news clippings, and readership reports. Also includes all overhead and administrative expenses.

2.	MEDIA PLACEMENT GUARANTEES

CVI represents, warrants and agrees that:

a) CLIENT’s VNR will air on national and local cable, satellite and broadcast affiliates throughout the U.S. and Canada. Programs will air as regular (non-paid) programming and as sponsored (paid) programming.

b) CVI guarantees at least 25,000 total airings generated from a combination of cablecasts and broadcasts. Counted airings will take place between 6 AM and 10:30 PM daily, EST and each city counts as one airing. A 30 second VNR spot will air on seven networks (CNBC, CNN Headline News, Fox News, MSNBC, The Weather Channel and Bloomberg TV) in 208 markets, with 350 of those airings in the Top 50 markets. Airings will hit 15 million subscribers with a median household income of $65,000 and guarantees a Nielsen reported reach of more than 482,000 adult viewers.

c) CVI guarantees nationwide distribution of the VNR on one or more national networks such as CNN, MSNBC, FOX News Channel, CNBC, Dish Network and AMC.

d) CLIENT is guaranteed at least twelve interviews on national and/or local market TV and Radio talk shows during the twenty-four month term of this campaign.

e) CLIENT is also guaranteed to receive a minimum of 200 Newspaper Feature placements;

f) 200 Radio News Release (RNR) placements.

CLIENT will receive usage reports with maps, bar charts, pie charts and circulation data plus physical clippings from newspapers and magazines---verifying the guaranteed number of placements and audience impressions. TV, Print and Radio elements are subject to editing by media outlets.

1.	PROMOTIONAL ELEMENTS

a)	CLIENT will receive One Hundred (100) fully packaged DVD copies of the Corporate Video or VNR (CLIENT’s choice) with the option to purchase more at guaranteed competitive prices. CLIENT is free to choose five additional TV airings instead of the copies.

b)	CLIENT’s complete Spotlight transcript, CLIENT logo, capsule description and links to CLIENT's site will be featured as a TOP STORY during the twenty-four month term of this campaign on one or more news portals.

c)	CLIENT will receive Video Streaming of CLIENT’s Spotlight for at least six months.

2.	GRANT OF RIGHTS

CVI hereby grants to CLIENT the complete, unconditional and exclusive worldwide ownership in perpetuity of the Corporate Video, Tradeshow Loop Presentation, and Internet Streaming versions. CLIENT shall, accordingly, have the sole and exclusive right to copyright any such materials in its name, as the sole owner and author thereof (it being understood that for such purposes CVI shall be CLIENT’s “employees for hire” as such term is defined in the United States Copyright Act). However, any re-editing / re-purposing of footage containing TV news anchors and reporters for commercial broadcast use (e.g. infomercial usage) will require their written approval. CVI grants to CLIENT the rights to: a) approve Scripts prior to Shooting; b) approve final edited corporate version; c) receive additional VHS, DVD, or CD copies of all materials at guaranteed rates. CLIENT is free to use any vendor if CVI cannot match their written quote.

CLIENT grants to CVI all rights to edit, distribute, exhibit, syndicate and market worldwide (via cable, network TV, satellite, cruise lines, airlines, video, internet, CD, DVD, etc.) in perpetuity all programming created for broadcast purposes under this Agreement. CVI and its partners retain complete ownership and editorial content of its TV, Radio, and Internet shows, and websites.

Article I

CLIENT hereby contracts CVI commencing on the date specified below and continuing for a period of up to twenty-four (24) months or until CVI has performed the above mentioned services, whichever shall come first, to act as an independent agent to or though its agents, servants, and employees perform such services for CLIENT as are consistent with the intent of this Agreement.

The media consulting fee due upon execution and any such other compensation for services, offered by CVI as set forth in this Agreement shall be paid as follows: Four Hundred Thousand restricted shares of the Class C Preferred stock of Nexia Holdings, Inc. (“NXHD”) with a face value of $5.00 per share for total face value of $2,000,000.

This agreement is subject to CLIENT’s share price for the above referenced payment being established at the time of payment of shares. If CLIENT’s share price should fall below the valuation contemplated and established at the time of the payment as described above in this Agreement but prior to distribution of finished/approved elements to media outlets, CLIENT will make up any short fall incurred. Once all elements have been distributed to media outlets, CLIENT will have no further obligation to cover any short fall which might occur in the event of the established share price dropping after distribution of the campaign has begun.

Article II

CLIENT agrees that CVI will have the right to use CLIENT’s personnel and CVIs when necessary, and CVI will provide and pay all costs pertaining to this Agreement relating to legal and other necessary services required for CVI to perform its duties.

Article III

If any portion of this Agreement is determined to be void as against the law or public policy, such provision shall not render the entire Agreement void, but only the invalid portion shall be so construed, and those provisions of this Agreement as evidenced by this Agreement shall be entered into and carried out.

The parties agree that in the event any party to this Agreement shall fail or refuse to perform any of the provisions of this Agreement, the other party hereto shall be entitled to injunctive relief enjoining and restraining the violations of any of the provisions of this Agreement and compelling specific performance of this Agreement as set forth herein.

The waiver by either party of breach or violation of, or failure to comply with, any term condition or provision of this Agreement by the other party shall not effect this Agreement and shall not operate or be construed as a waiver of any subsequent breach, rights, or remedies of the parties hereto.

No departure from this Agreement will constitute a waiver or modification of any of the provisions or conditions, or the rights, or remedies of either of the parties hereto.

This Agreement is made with reference to the laws of the State of Utah, unless another state may have jurisdiction in this transaction requiring the application of that state’s laws to this particular transaction.

It is expressly understood that this Agreement shall bind any successors, assigns, subsidiaries, or extensions to the parties hereto.

It is expressly understood and agreed that CLIENT and CVI are completely separate entities and are not partners, joint ventures, nor agents for each other in any sense whatsoever and neither party has the power or right to obligate or bind the other. It is also expressly understood that CVI has not represented itself as a brokerage firm, venture capital firm, or by other definition, a capital raising entity in this transaction.

This Agreement is complete and it is mutually agreed and understood that no other agreements, statements, inducements, or representations, written or verbal, have been made or relied upon by either party. In addition, because CVI has agreed to accept CLIENT’S stock as compensation for its services; CLIENT understands and agrees that CVI does not recommend or give any advice to investors regarding CLIENT’S stock, including evaluations or performance. CVI makes no representations or warranties that its services contemplated herein will have any bearing whatsoever on CLIENT’S present or future share price. The modifications hereto or amendments hereto shall be binding when presented in writing and signed by both parties.

This Agreement may be signed in counterpart.

Signed by a person or persons duly authorized by CLIENT and CVI.

For CVI		For CLIENT
/s/ Joe Davis		/s/ Richard Surber
Clearvision, Inc.		NEXIA HOLDINGS INC.
By: Joe Davis		By: Richard Surber
Date: September 30, 2008		Date: September 23, 2008

EX-99 5 ex99.htm EXHIBIT 99 ex99.htm

Exhibit 99(lx)

STOCK OPTION AGREEMENT

This Stock Option Agreement ("Stock Option Agreement") is granted effective this 9th day of September, 2008 by Nexia Holdings, Inc. (the "Company") to Shauna Postma, an employee of the Company ("Optionee") and a Utah resident.

PREMISES

The Company has received valuable services from Optionee in the past and desires to compensate and grant a bonus to Optionee for these services by issuing Optionee an option (the "Option") to purchase a total of One Hundred Thousand (100,000), shares of the Company's common stock. The options will have a floating option price set at 50% of the market price at the time of exercise. The shares issued subject to the options shall be issued pursuant to a registration statement on Form S-8 under the Securities Act of 1933 as amended ("Form S-8").

GRANT

Grant of Options. The Company hereby grants Optionee the right and option ("Option") to purchase the above described One Hundred Thousand (100,000) shares of Common Stock, on the terms and conditions set forth herein and subject to the provisions of the Form S-8 registration statement in exchange for services provided by Employee to the Company, the options shall vest immediately upon the exercise hereof.

Term of Option. This Option may be exercised, in whole or in part, at any time within 1 year from the grant date above. All rights to exercise this option end with the termination of employment with the Company, for any reason and by any party.

Method of Exercising. This Option may be exercised in accordance with all the terms and conditions set forth in this Option and the Stock Option Plan, by delivery of a notice of exercise a form of which is attached hereto as Exhibit "A" and incorporated herein by this reference, setting forth the number of Options along with a signed letter of instruction to the stock broker Optionee will employ in selling the shares indicating that the specified exercise price shall be paid within 10 days of the sale or as otherwise specified at the time of exercise. Shares issued in anticipation of the exercise of the option shall not be deemed as issued and outstanding until such time as the option has been fully exercised by payment of the option price.

Optionee Not an Affiliate. Optionee hereby represents, warrants and covenants that he is not an affiliate of the Company as that term is defined in Rule 144(a)(1) under the Securities Act of 1933.

Availability of Shares. During the term of this Option, the Company shall reserve for issuance the number of shares of Common Stock required to satisfy this Option.

Adjustments to Number of Shares. The number of shares of Common Stock subject to this Option shall be adjusted to take into account any stock splits, stock dividends, recapitalization of the Common Stock as provided in the Stock Option Plan.

Limitation on Exercise. If the board of directors of the Company, in its sole discretion, shall determine that it is necessary or desirable to list, register, or qualify the Common Stock under any state or federal law, this Option may not be exercised, in whole or part, until such listing, registration, or qualification shall have been obtained free of any conditions not acceptable to the board of directors.

Restrictions on Transfer. The Option has not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities statutes. The shares of Common Stock issuable on exercise of the Option will be qualified for registration under a Form S-8 Registration Statement filed with the Securities and Exchange Commission.

Record Owner. The Company may deem the Optionee as the absolute owner of this Option for all purposes. This Option is exercisable only by the Optionee, or by the Optionee's duly designated appointed representative. This Option is not assignable.

10.

Shareholder's Rights. The Optionee shall have shareholder rights with respect to the Option shares only when Optionee has exercised this Option to purchase those shares and provided the Company with the letter of instruction specified in Section 4 of this Option.

11.

Information provided to Optionee. Optionee hereby acknowledges that he/she has been informed of the web address for or has received a printed copy of the S-8 Registration Statement for the 2008 Employee Benefit Plan for Nexia Holdings, Inc. and the 10(a) prospectus with regard to that benefit plan, prior to signing this agreement

12.

Validity and Construction. The validity and construction of this Agreement shall be governed by the laws of the State of Utah.

IN WITNESS WHEREOF, the below signatures evidence the execution of this Option by the parties on the date first appearing herein.

OPTIONEE Nexia Holdings, Inc.

/s/ Shauna Postma

/s/ Richard Surber

Shauna Postma, Optionee Richard Surber, President

Exhibit 99(lxi)

STOCK OPTION AGREEMENT

This Stock Option Agreement ("Stock Option Agreement") is granted effective this 9th day of September 2008 by Nexia Holdings, Inc. (the "Company") to Pamela Hyde, an employee of the Company ("Optionee") and a Utah resident.

PREMISES

The Company has received valuable services from Optionee in the past and desires to compensate Optionee for these services by issuing Optionee an option (the "Option") to purchase a total of One Hundred Thousand (100,000), shares of the Company's common stock, par value $0.0001, the options will have a floating option price set at 50% of the market price at the time of exercise. The options and shares issued subject to the options shall be issued pursuant to a registration statement on Form S-8 under the Securities Act of 1933 as amended ("Form S-8").

GRANT

Method of Exercising. This Option may be exercised in accordance with all the terms and conditions set forth in this Option and the Stock Option Plan, by delivery of a notice of exercise a form of which is attached hereto as Exhibit "A" and incorporated herein by this reference, setting forth the number of Options along with a signed letter indicating that the specified exercise price shall be paid within 10 days of the sale or as otherwise specified at the time of exercise. Shares issued in anticipation of the exercise of the option shall not be deemed as issued and outstanding until such time as the option has been fully exercised by payment of the option of the option price.

Optionee Not an Affiliate. Optionee hereby represents, warrants and covenants that he is not an affiliate of the Company as that term is defined in Rule 144(a)(1) under the Securities Act of 1933.

Availability of Shares. During the term of this Option, the Company shall reserve for issuance the number of shares of Common Stock required to satisfy this Option.

10.

11.

12.

Validity and Construction. The validity and construction of this Agreement shall be governed by the laws of the State of Utah.

IN WITNESS WHEREOF, the below signatures evidence the execution of this Option by the parties on the date first appearing herein.

OPTIONEE Nexia Holdings, Inc.

/s/ Pamela Hyde

/s/ Richard Surber

Pamela Hyde, Optionee

Richard Surber, President

Exhibit 99(lxii)

STOCK OPTION AGREEMENT

This Stock Option Agreement ("Stock Option Agreement") is granted effective this 9th day of September 2008 by Nexia Holdings, Inc. (the "Company") to Fredrick W. Hunzeker, an employee of the Company ("Optionee") and a Utah resident.

PREMISES

The Company has received valuable services from Optionee in the past and desires to compensate Optionee for these services by issuing Optionee an option (the "Option") to purchase a total of Five Hundred Thousand (500,000), shares of the Company's common stock, par value $0.0001, the options will have an option price set at $0.025 per share. The options and shares issued subject to the options shall be issued pursuant to a registration statement on Form S-8 under the Securities Act of 1933 as amended ("Form S-8").

GRANT

Grant of Options. The Company hereby grants Optionee the right and option ("Option") to purchase the above described Five Hundred Thousand (500,000) shares of Common Stock, on the terms and conditions set forth herein and subject to the provisions of the Form S-8 registration statement in exchange for services provided by Employee to the Company, the options shall vest immediately upon the exercise hereof.

Method of Exercising. This Option may be exercised in accordance with all the terms and conditions set forth in this Option and the Stock Option Plan, by delivery of a notice of exercise a form of which is attached hereto as Exhibit "A" and incorporated herein by this reference, setting forth the number of Options along with a signed letter indicating that the specified exercise price shall be paid within 10 days of the sale or as otherwise specified at the time of exercise. Shares issued in anticipation of the exercise of the option shall not be deemed as issued and outstanding until such time as the option has been fully exercised by payment of the option of the option price.

Optionee Not an Affiliate. Optionee hereby represents, warrants and covenants that he is not an affiliate of the Company as that term is defined in Rule 144(a)(1) under the Securities Act of 1933.

Availability of Shares. During the term of this Option, the Company shall reserve for issuance the number of shares of Common Stock required to satisfy this Option.

10.

11.

12.

Validity and Construction. The validity and construction of this Agreement shall be governed by the laws of the State of Utah.

IN WITNESS WHEREOF, the below signatures evidence the execution of this Option by the parties on the date first appearing herein.

OPTIONEE Nexia Holdings, Inc.

/s/ Fredrick W. Hunzeker

/s / Richard Surber

Fredrick W. Hunzeker, Optionee

Richard Surber, President

Exhibit 99(lxiii)

STOCK OPTION AGREEMENT

This Stock Option Agreement ("Stock Option Agreement") is granted effective this 9th day of September, 2008 by Nexia Holdings, Inc. (the "Company") to John Mortensen, an employee of the Company ("Optionee") and a Utah resident.

PREMISES

The Company has received valuable services from Optionee in the past and desires to compensate and grant a bonus to Optionee for these services by issuing Optionee an option (the "Option") to purchase a total of Five Hundred Thousand (500,000), shares of the Company's common stock. The options will have an option price set at $0.025 per share at the time of exercise. The shares issued subject to the options shall be issued pursuant to a registration statement on Form S-8 under the Securities Act of 1933 as amended ("Form S-8").

GRANT

Grant of Options. The Company hereby grants Optionee the right and option ("Option") to purchase the above described Five Hundred Thousand (500,000), shares of Common Stock, on the terms and conditions set forth herein and subject to the provisions of the Form S-8 registration statement in exchange for services provided by Employee to the Company, the options shall vest immediately upon the exercise hereof.

Optionee Not an Affiliate. Optionee hereby represents, warrants and covenants that he is not an affiliate of the Company as that term is defined in Rule 144(a)(1) under the Securities Act of 1933.

Availability of Shares. During the term of this Option, the Company shall reserve for issuance the number of shares of Common Stock required to satisfy this Option.

10.

11.

12.

Validity and Construction. The validity and construction of this Agreement shall be governed by the laws of the State of Utah.

IN WITNESS WHEREOF, the below signatures evidence the execution of this Option by the parties on the date first appearing herein.

OPTIONEE Nexia Holdings, Inc.

/s/ John Mortensen

/s / Richard Surber

John Mortensen, Optionee Richard Surber, President

Exhibit 99(lxiv)

STOCK OPTION AGREEMENT

This Stock Option Agreement ("Stock Option Agreement") is granted effective this 9th day of September 2008 by Nexia Holdings, Inc. (the "Company") to Michael Golightly, an employee of the Company ("Optionee") and a Utah resident.

PREMISES

The Company has received valuable services from Optionee in the past and desires to compensate Optionee for these services by issuing Optionee an option (the "Option") to purchase a total of Five Hundred Thousand (500,000), shares of the Company's common stock, par value $0.0001, the options will have an option price set at $0.025 per share at the time of exercise. The options and shares issued subject to the options shall be issued pursuant to a registration statement on Form S-8 under the Securities Act of 1933 as amended ("Form S-8").

GRANT

Method of Exercising. This Option may be exercised in accordance with all the terms and conditions set forth in this Option and the Stock Option Plan, by delivery of a notice of exercise a form of which is attached hereto as Exhibit "A" and incorporated herein by this reference, setting forth the number of Options along with a signed letter indicating that the specified exercise price shall be paid within 10 days of the sale or as otherwise specified at the time of exercise. Shares issued in anticipation of the exercise of the option shall not be deemed as issued and outstanding until such time as the option has been fully exercised by payment of the option of the option price.

Optionee Not an Affiliate. Optionee hereby represents, warrants and covenants that he is not an affiliate of the Company as that term is defined in Rule 144(a)(1) under the Securities Act of 1933.

Availability of Shares. During the term of this Option, the Company shall reserve for issuance the number of shares of Common Stock required to satisfy this Option.

10.

11.

12.

Validity and Construction. The validity and construction of this Agreement shall be governed by the laws of the State of Utah.

IN WITNESS WHEREOF, the below signatures evidence the execution of this Option by the parties on the date first appearing herein.

OPTIONEE Nexia Holdings, Inc.

/s/ Michael Golightly

/s / Richard Surber

Michael Golightly, Optionee

Richard Surber, President