INFORMATION
of the Securities Exchange Act of 1934
Filed by the Registrant[X]
Filed by a Party other than the Registrant [ ]
2009. 702, New York, New York 10022. Directors ANSWERS ABOUT THIS PROXY MATERIAL AND VOTING Company. The following table sets forth the names and positions of each nominee for Director and our executive officers. Additional biographical information concerning these individuals including directorships at other public companies, as well as the specific experiences, qualifications, attributes and skills that have led the Board to determine that such Board members should serve on the Board of Number of Shares of Common Stock Percent Derek J. Cooper 10,000 (1)(2)(3) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Christian Hudson 10,000 (1)(2) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Jeet Sidhu 10,000 (1)(2)(4) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Frank Fabio 0 (1)(5) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 1420525 Alberta Ltd. (6)(7) 32,639,800 (7) 52 % 1628 West 1st Avenue, Suite 216 Vancouver, BC V6J 1G1 Directors and Executive Officers 0 0.0 % as a group (4 persons) Name and Principal Position Year Salary Other Options Awards ($) Total Derek Cooper 2008 0 10,000(2) $ 4,840 President, CEO, 2007 n/a Chief Financial Officer 2006 n/a and Director Harmel S. Rayat (1) 2008 $ 0 $ 0 $ 0 0 President, CEO, 2007 $ 0 $ 0 $ 0 0 Chief Financial Officer 2006 $ 0 $ 0 $ 4,500 0 and Director Tim Luu (1) 2008 $ 0 $ 0 $ 0 0 Secretary, Treasurer 2007 $ 0 $ 0 $ 3,000 0 Chief Technology Officer 2006 $ 0 $ 0 $ 3,300 0 and Director Name Number of Securities Underlying Options % of Total Options Granted in 2008(1) Exercise Price ($/sh) Expiration Date Derek J. Cooper 50,000 25% $ 1.00 9/12/2018 Harmel Rayat(2) 0 0 n/a n/a Tim Luu (1) 0 0 n/a n/a Common Shares Underlying Unexercised Value of Unexercised In-the-money Options on December 31, 2008 Options on December 31, 2008 OptionExpiration Name Exercisable Unexercisable Exercisable Unexercisable Date Derek J. Cooper(1) 0 50,000 0 $ 50,000 9/12/2018 Harmel Rayat (2) 0 0 0 0 Tim Luu (2) 0 0 0 0 regulations of the Securities and Exchange Commission governing the determination of beneficial ownership of securities. Under the rules of the Securities and Exchange Commission, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or to direct the voting of the security, or investment power, which includes the power to dispose of or to direct the disposition of the security. Except as indicated in the footnotes to this table, each beneficial owner named in the table below has sole voting and sole investment power with respect to all shares beneficially owned and each person's address is c/o our principal office address (unless otherwise indicated) at 430 Park Avenue, New York, New York 10022. BENEFICIAL OWNERSHIP REPORTING COMPLIANCE serving as executive officers of the Company at the end of the 2009 fiscal year (the “ Table to attend meetings of the Board. Commencing in August 2010, each non employee director receives a flat monthly fee of $2,000 for his services as a director. ANNUALMEETINGFiled by the Registrant x Filed by a Party other than the Registrant ¨ [ ] Preliminary Proxy Statement[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))[X] Definitive Proxy Statement[ ] Definitive Additional Materials[ ] Soliciting Material Pursuant to §240.14a-12x Preliminary Proxy Statement ¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) ¨ Definitive Proxy Statement ¨ Definitive Additional Materials ¨ Soliciting Material Pursuant to § 240.14a-12 Asas Specified In Its Charter):[X] No fee required[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.1)x No fee required. ¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. 2)3)_____________________________________________4)_________5)_______________________________________[ ] Fee paid previously with preliminary materials.[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.1)¨ Fee paid previously with preliminary materials. ¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. ______________________________2)_____________3) ________________________________________4) _________________________________________ENTHEOS TECHNOLOGIES, INC.888 3rdStreet SW, Suite 1000Calgary, AB T2P 5C5Telephone: 800-755-5815November 2, 200920092010 Annual Meeting of Stockholders of Entheos Technologies, Inc. The meeting will be held at 10:9:00 a.m., local time, on December 14, 2009,20210, at 888 3rd Street SW,430 Park Avenue, Suite 1000, Calgary, AB T2P 5C5.702, New York, New York 10022. Enclosed are the official notice of this meeting, a proxy statement, a form of proxy and the 20082009 Annual Report on Form 10-K/A10-K for the year ended December 31, 2008.2009,2010, approve the change of our company name to “Janus Resources, Inc.” and to transact any other business as may properly come up before the meeting.2, 2009,3, 2010, and to guests of the Company.888 3rd Street SW,430 Park Avenue, Suite 1000, Calgary, AB T2P 5C5.Derek CooperAntonino CacaceDerek CooperAntonino Cacace, President, Chief Executive Officer and Director OF ENTHEOS TECHNOLOGIES, INC. 2009To2010 Stockholders of Entheos Technologies, Inc.:NOTICE IS HEREBY GIVEN that the 2009 Annual Meeting of Stockholders (the "Annual Meeting") of Entheos Technologies, Inc., a Nevada corporation (the "Company"“Company”),. The meeting will be held on Tuesday, December 14, 2010 commencing at 888 3rd Street SW,9:00 A.M., local time, at 430 Park Avenue, Suite 1000, Calgary, Alberta on the 14th day of December, 2009, at 10:00 a.m. (local time)702, New York, New York 10022, for the following purposes:1. To elect 3 directors to the Board of Directors to serve until the next Annual Meeting of stockholders or until their respective successors are duly elected and have qualified;2. To ratify the appointment of Petersonpurposes:1. To elect three (3) nominees for director named herein to hold office for one year or until the 2011 Annual Meeting of Stockholders or until their respective successors have been duly elected and qualified; 2. To ratify the selection of Petersen Sullivan LLP, as the Company’s independent auditors for the year ending December 31, 2010; 3. To approve an amendment to the Company’s Articles of Incorporation changing its name to Janus Resources, Inc.; and To transact such other business as the Company's independent auditor for the fiscal year ending December 31, 2009;3. To transact any and all other business that may properly come before the meeting and all adjournments and postponements thereof.or any adjournment(s) thereof.Pursuant to the Company's Bylaws (the "Bylaws"), the record date (the "Record Date") for the determination ofis November 3, 2010. Only stockholders entitled to notice of and to vote at such meeting or any adjournment(s) thereof shall be the close of business on November 2, 2009. Only holders of record of the Company's Common Stock at the close of business on the Record Date are entitled to notice of and tothat date may vote at the Annual Meeting. Shares can be voted at the Annual Meeting only if the holder is presentmeeting or represented by proxy. The stock transfer books will not be closed.A copyany adjournment thereof.Company's 2008 Annual Report to Stockholders, in the formBoard of the 10-K/A filed with the Securities and Exchange Commission, which includes audited financial statements, has been included in this mailing to the Company's stockholders. A list of stockholders entitled to vote at the Annual Meeting will be available for examination at the offices of the Company for ten (10) days prior to the Annual Meeting.Antonino Cacace President/Chief Executive Officer New York, New York November 14, 2010 Annual Meeting; whethermeeting in person. Whether or not you expect to attend the meeting, in person, however, you are urged to mark,please complete, date, sign date, and mail or telefaxreturn the enclosed form of proxy as instructed in these materials, as promptly so that your shares of stock may be represented and voted in accordance with your wishes andas possible in order that the presence of a quorum may be assuredto ensure your representation at the meeting. Your proxy will be returned to youA return envelope (which is postage prepaid if mailed in the United States) is enclosed for your convenience. Even if you should be presenthave voted by proxy, you may still vote in person if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the Annual Meeting and should request its returnmeeting, you must obtain a proxy issued in the manner provided for revocation of proxies on the initial page of the enclosed proxy statement.BY ORDER OF THE BOARD OF DIRECTORS
your name from that record holder./s/ Derek CooperDerek CooperPresident, Chief Executive Officer and DirectorCalgary, ABNovember 2, 2009ENTHEOS TECHNOLOGIES, INC.888 3rdStreet SW, Suite 1000Calgary, AB T2P 5C5TO BE HELD DECEMBER 14, 2009SOLICITATIONREVOCABILITY OF PROXIESThe accompanyingWe have sent you these proxy is solicited bymaterials because the Board of Directors on behalf of Entheos Technologies, Inc., a Nevada corporationInc. (sometimes referred to as the “Company,” “Entheos,” “we” or “us”) is soliciting your proxy to vote at the 2010 Annual Meeting of Stockholders. According to our records, you are a stockholder of the Company.Proxy Statement asproxy statement. However, you do not need to attend the "Company," “we,” “our,”meeting to vote your shares. Instead, you may simply complete, sign and “us”return the enclosed proxy card.1. To elect three nominees for director named herein to hold office for one year or until the 2011 Annual Meeting of Stockholders or until their respective successors have been duly elected and qualified; 2. To ratify the selection of Petersen Sullivan LLP, as the Company’s independent auditors for the year ending December 31, 2010; 3. To approve an amendment to the Company’s Articles of Incorporation changing the Company’s name to Janus Resources, Inc; and To transact such other business as may properly come before the meeting and all adjournments and postponements thereof. at the 2009 Annual Meetingon, you may vote “For” or “Against” or abstain from voting. The procedures for voting are fairly simple:StockholdersRecord: Shares Registered in Your NameCompany (the "Annual Meeting") to be held on December 14, 2009, at the time and place and for the purposes set forth in the accompanying Notice of Annual Stockholders (the "Notice") and at any adjournment(s) thereof.When proxies in the accompanying form are properly executed and received, the shares represented thereby will be voted at the Annual Meeting in accordance with the directions noted thereon; if no direction is indicated, such shares will be voted FOR the election of the nominees listed thereon, FOR the ratification of the ind ependent auditor, and in their discretion with respect to any other matters thatRecord Date, you may properly come before the stockholders at the Annual Meeting.The executive offices of the Company are located at, and the mailing address of the Company is 888 3rd Street SW, Suite 1000, Calgary, AB. Management does not anticipate that any matters will be presented at the Annual Meeting other than matters set forth in the Notice.This proxy statement (the "Proxy Statement") and accompanying proxy are being mailed on or about November 12, 2009. The Company's Annual Report on Form 10-K/A (the "2008 Annual Report"), which serves as the Annual Report to Stockholders, covering the Company's fiscal year ended December 31, 2008, is attached.Any stockholder of the Company giving a proxy has the right to revoke their proxy at any time prior to the voting thereof by votingvote in person at the Annual Meeting or vote by deliveringproxy using the enclosed proxy card. Whether or not you plan to attend the meeting, we urge you to vote by proxy to ensure your vote is counted. You may still attend the meeting and vote in person even if you have already voted by proxy.· To vote in person, come to the annual meeting and we will give you a ballot when you arrive. You should be prepared to present photo identification for admittance. A list of stockholders eligible to vote at the annual meeting will be available for inspection at the annual meeting and for a period of ten days prior to the annual meeting during regular business hours at our principal executive offices, which are located at 430 Park Avenue, Suite 702, New York, New York 10022 · To vote using the proxy card, simply complete, sign and date the enclosed proxy card and return it promptly in the envelope provided. If you return your completed and signed proxy card to us before the annual meeting, we will vote your shares as you direct. duly executedbeneficial owner of shares registered in the name of your broker, bank, or other agent, you should have received voting instructions with these proxy bearingmaterials from that organization rather than from us. Simply complete and mail your voting instructions as directed by your broker or bank to ensure that your vote is counted. Alternatively, you may be able to vote by telephone or over the Internet by following instructions provided by your broker or bank. To vote in person at the annual meeting, you must obtain a later datevalid proxy from your broker, bank, or by giving written noticeother agent. Follow the instructions from your broker or bank included with these proxy materials, or contact your broker or bank to requ est a proxy form. revocation to the Company addressed to Derek Cooper, President, 888 3rd Street SW, Suite 1000, Calgary, AB, T2P 5C5; no such written notice shall be effective, however, until such notice of revocation has been received by the Company at or prior to the Annual Meeting.In addition to the solicitation of proxies by use of the mail, officers and regular employees of the Company may solicit the return of proxies, either by mail, telephone, telefax, telegraph or through personal contact. Such officers and employees will not be additionally compensated but will be reimbursed for out- of-pocket expenses. Brokerage houses and other custodians, nominees, and fiduciaries will, in connection with shares of the Company's common stock $0.00001 par value per share (the "Common Stock"), registered in their names, be requested to forward solicitation material toyou own as of November 3, 2010.beneficial owners of such shares of Common Stock.The cost of preparing, printing, assembling, and mailing the 20082010 Annual Report, the Notice, this Proxy Statement, and the enclosed form of proxy, as well as the cost of forwarding solicitation materials to the beneficial owners of shares of Common Stock and other costs of solicitation, are to be borne by the Company.QUORUM AND VOTINGThe record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting was the close of business on November 2, 2009 (the "Record Date"). On the Record Date, there were 63,075,122 shares of Common Stock issued and outstanding.
Meeting?Each share of Common Stock is entitled to one vote on all matters to be acted upon at the Annual Meeting, and neither the Company's Certificate of Incorporation (the "Certificate of Incorporation") nor its Bylaws allow for cumulative voting rights.Common Stockcommon stock entitled to vote at the meeting is necessary to constitute a quorum to transact business. If a quorum is not present or represented at the 2010 Annual Meeting, the stockholders entitled to vote thereat, present in person or by proxy, may adjourn the 2010 Annual Meeting from time to time without notice or other announcement until a quorum is present or represented. Assuming the presence of a quorum, the affirmative vote of a plurality of votes cast is required for the election of each of the nominees for director. A majority of the votes represented and entitled to vote at the Annual2010Annual Meeting will be required for the approval of all other matters to be voted upon. A bstentionsAbstentio ns and broker non-votes will each be counted towards the presence of a quorum, but (i) will not be counted as votes cast and, accordingly, will have no effect on the plurality vote required for the election of directors, and (ii) will be counted as votes represented at the Annual2010Annual Meeting and, accordingly, will have the effect of a vote "against" all other matters to be acted upon.Proxies in the accompanying form which are properly executedreturned to the Company will be voted at the Annual Meeting in accordance with the instructions contained in such proxies and, at the discretion of thedated proxy holders, on such other matters as may properly come before the meeting. Where no such instructions are given, thecard without marking any voting selections, your shares will be voted for“FOR” the election of each of theall three nominees for director, and“FOR” the ratification of Peterson Sullivan LLP as the independent auditor.A stockholder that intends to present a proposal at the 2009 Annual Meeting of Stockholders for inclusion in the Company's proxy statement and form of proxy relating to such meeting must submit such proposal by November 23, 2009. The proposal must be mailed to the Company's offices at 888 3rd Street SW, Suite 1000, Calgary, AB.RIGHT TO REVOKE PROXIESAny proxy given pursuant to this solicitation may be revoked by the person giving it at any time before it is voted. Proxies may be revoked by:·filing with the Presidentregistered public accountants of the Company beforefor its fiscal year ending December 31, 2010, “FOR” the polls are closed with respectapproval of an amendment to the Company’s Articles of Incorporation changing the Company’s name to Janus Resources, Inc., and, if any other matter is properly presented at the meeting, your proxy holder (one of the individuals named on your proxy card) will vote a written noticeyour shares using his best judgment.revocation bearing a later date thandirectors recommend that I vote?proxy;·duly executing a subsequent proxy relatingthree nominees to the same sharesboard of Common Stockdirectors and delivering it to“FOR” the Presidentamendment of the Company; or·attendingArticles of Incorporation to change the Meetingcorporate name to Janus Resources, Inc., Inc. and voting in person (although attendance at“FOR” the Meeting will not in and of itself constitute a revocation of a proxy).Any written notice revoking a proxy should be sent to: 888 3rd Street SW, Suite 1000, Calgary, AB, Attention: Derek Cooper.SUMMARYThe Company is a small independent oil and gas production company with a focus on participation in producing and the redevelopment/ recompletion of oil and gas wells. Incorporated under the lawsratification of the Stateappointment of Nevada,Peterson Sullivan LLP as our independent auditors for the Company has an authorized capital of 200,000,000 shares of $0.00001 par value common stock, of which 63,075,122 shares are outstanding and 10,000,000 shares of $0.0001 par value preferred stock, of which none are outstanding.From 2002 until September 2008, through our wholly-owned subsidiary Email Solutions, Inc.fiscal year ending December 31, 2010. Unless you give other instructions on your proxy card or electronically (internet or telephone), the Company servedpersons named as an Application Service Provider (“ASP”) providing outsourced email and search engine optimization services. Due toproxy holders on the limited success of our ASP business, management decided that it wasproxy card will vote in accordance with the best interest of our stockholders to abandon the Application Service Provider business and focuson identifying undervalued oil and gas opportunities for acquisition, development and exploration. The assets and liabilities, the results of operations and cash flows related to the ASP business were not classified as discontinued operations as the amounts were not significant.Oil and Gas PropertiesIn September 2008, the Company acquired a 21.75% working interest (16.3125% net revenue interest) in the Cooke #6 well located at the Cooke Ranch field in La Salle County, Texas which has been producing oil and gas from the Escondido formation since 2007. In September 2008, the company acquired a 20.00% working interest (15.00% net revenue interest) in Onnie Ray #1 Well in Lee County, Texas and the Stahl #1 Well in Fayette County, Texas which were subsequently reentered and are producing gas from the Austin Chalk formation and a 20.00% working interest (15.00% net revenue interest) in the Haile #1 Well in Frio County, Texas which is currently scheduled for re-entry operations. The leases for these properties are maintained and operated by Leexus Oil LLC and Bayshore Exploration LLC; there are no obligations to further explore or develop lands in the lease areas to maintain the leases. The operatorsrec ommendations of the leases are not affiliated with Entheos or anyCompany's Board of its directors or major shareholders.The Company's 2008 Annual Report, a copy of which is attached, provides a description of our operations during the past year.The following is a brief summary of certain information contained elsewhereDirectors as set forth in this Proxy Statement. This summary is not intendedbe complete and is qualified in all respects by reference to the detailed information appearing elsewhere in this Proxy Statement.THE MEETINGDate, Time and Place of the Annual MeetingThe Annual Meeting of Entheos Technologies, Inc. is scheduled to be held on December 14, 2009, at 10:00 a.m. (local time) at 888 3rd Street SW, Suite 1000, Calgary, AB T2P 5C5.Record DateOnly holders of record of shares of Common Stock at the close of business on November 2, 2009, are entitled to receive notice of and to vote at the Annual Meeting.Vote RequiredAssuming the presence of a quorum, the affirmative vote of a plurality of votes cast is required forapprove each proposal?eachdirectors, the three nominees receiving the most “For” votes at the meeting in person or by proxy will be elected. All other matters, other than the proposal to amend our amended and restated certificate of incorporation, require for approval, the nominees for director. Afavorable vote of a majority of the votes cast with a quorum presenton the applicable matter at the Annual Meetingannual meeting in person or by proxy. · You may submit another properly completed proxy card with a later date. · You may send a timely written notice that you are revoking your proxy to the Company at 430 Park Avenue, Suite 702, New York, New York 10022, Attn: President and Chief Executive Officer. · requiredannounced at the annual meeting. Final voting results will be discussed in a Form 8-K filed after the annual meeting.approval of all other matters to be voted upon.AccountantsPeterson Sullivan, LLP has been selected by the Company to act as its independent auditor for 2009. It is not expected that the representatives of Peterson Sullivan, LLP will attend the Annual Meeting or be available to answer questions from the stockholders.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTSeptember 30, 2009,Directors is provided in the beneficial ownershiptext following the table.Name Position Antonino Cacace President and Chief Executive Officer, Director David Jenkins Director Joseph Sierchio Director Company's Common Stock by each director and executive officernominees to the Board of Directors currently serves as a member of the Company and each person known by the Company to beneficially own more than 5%Board of the Company's Common Stock outstanding as of such date and the executive officers and directors of the CompanyDirectors as a group.(1) 200,000 stock options (50,000result of being appointed to each of Messrs. Cooper, Hudson, Fabio and Sidhu) were granted on September 12, 2008; the exercise price per share is $1.00; the options vest at the rate of 10,000 per annum in arrears commencing September 12, 2009.(2) Each of Messrs. Cooper, Hudson and Sidhu were appointed tothat position by the Company’s Board of Directors, in order to fill vacancies created by the resignation of certain of our prior Directors.September 12, 2008.(3)Canadian, US and European stock exchanges. Mr. CooperCacace was appointedinvited to join the Board of Directors due to his experience with public companies in the matters relating to management, administration, financial reporting, legal compliance and business development.Chief Executive Officerofficers, directors and President on September 12, 2008.(4) Does not include 2,500,000 shares held in trust for the benefit of Mr. Sidhu’s children over which Mr. Sidhu has neither voting nor disposition authority; Mr. Sidhu disclaims any beneficially ownership interest in and to such shares.(5) Mr. Fabio was appointed the Company’semployees, including its Chief Financial Officer and Secretary on September 12, 2008 and resigned on January 9, 2009. At the time of his resignation none of the options had vested. Under the terms of his Option Agreement the unvested options terminated immediately. None of Mr. Fabio’s options had vested.(6) 1420525 Alberta Ltd. Is a private corporation the sole shareholder of which is Harmel S. Rayat; Mr. Rayat was our former Chief Executive Officer, Chiefwhich complies with the requirements of the Sarbanes-Oxley Act of 2002 and applicable Financial Officer, Secretary and director. Mr. Rayat resigned his positions with us on September 12, 2008.(7) Does not include 6,000,000 shares held in trust forIndustry Regulatory Authority (“FINRA”) listing standards. Accordingly, the benefitCode of Mr. Rayat’s children over which Mr. Rayat has neither voting nor disposition authority; Mr. Rayat disclaims any beneficially ownership interest inEthics is designed to deter wrongdoing, and to promote, among other things, honest and ethical conduct, full, timely, accurate and clear public disclosures, compliance with all applicable laws, rules and regulations, the prompt internal reporting of violations of the Code of Ethics, and accountability.shares.Remunerationexchange, including those related to the independence of directors. However, at this time, after considering all of the relevant facts and Executive CompensationNo executivecircumstances, the Company’s Board of Directors has determined that each of Messrs. Jenkins and Sierchio are independent from the Company’s management and qualify as “independent director” under the standards of independence under the applicable FINRA listing standards. This means that, in the judgment of the Board of Directors, neither of these two directors is (1) an officer or employee of the Company hador its subsidiaries or (2) has any direct or indirect relationship with the Company that would interfere with the exercise o f his independent judgment in carrying out the responsibilities of a total annual salary and bonus fordirector. Upon the fiscal year ended December 31, 2008 that exceeded $15,000.BecauseCompany’s listing on any national securities exchange or any inter-dealer quotation system, it will elect such independent directors as is necessary under the rules of any such securities exchange.limited operations we do not have any executive officers who are employeesand directors.the Company and therefore we have not incurred any payroll expenses during the fiscal years 2006, 2007 and 2008. We have compensatedinterests between certain of our officers whoand directors and us. Certain of our directors are also acting asdirectors of other mineral resource companies and, to the extent that such other companies may participate in ventures in which we may participate, our directors may have a conflict of interest in negotiating and concluding terms regarding the extent of such participation. In the event that such a conflict of interest arises at a meeting of our directors, a monthly stipenddirector who has such a conflict will abstain from voting for or against the approval of $2,500such participation or such terms. In appropriate cases, we will establish a special committee of independent directors to review a matter in which several directors, or management, may have a conflict. From time to time, s everal companies may participate in the acquisition, exploration and development of natural resource properties thereby allowing for their services as officersparticipation in larger programs, involvement in a greater number of programs and have compensated our directors with stock option grants.The following table shows, forreduction of the three-year period ended December 31, 2008, the cash compensation paid by the Company, as well as certain other compensation paid for such year, to the Company's Chief Executive Officer and the Company's other most highly compensated executive officers.Summary Compensation Table(1) Each of Messrs. Rayat and Luu resigned all of their respective positions with the Company on September 12, 2008.(2) Other compensation represents fees paid Derek Cooper as a Director of the Company.Stock Option Grants in Last Fiscal Year Shown below is further information regarding stock options awarded during 2008 to the named officers and directors: (1) Mr. Cooper received the options in his capacity as a director.(2)Resigned as an officer and director on September 12, 2008.Aggregated Option Exercises During Last Fiscal Year and Year End Option ValuesThe following table shows certain information about unexercised options at year-endfinancial exposure with respect to any one program. It may also occur that a particular company will assign all or a portion of its interest in a particular program to another of these companies due to the namedfinancial position of the company making the assignment.directors:(1) The option vested as to 10,000 shares on September 12, 2009.(2) Resigned as an Officer and Director on September 12, 2008.Related TransactionsExecutive Management: For the year ended December 31, 2008, the Company incurred $10,000 in fees paid to the Derek Cooper the President, Chief Executive Officer and Chief Financial Officerpersons who own more than 10% of the Company. In addition, during September 2008, the Company granted stock options to purchase 50,000 shares ofCompany’s common stock to Mr. Cooper. For the year ended December 31, 2008, the Company recorded $4,840 as stock compensation expense related to this stock grant.Director Fees: For the year ended December 31, 2008, the Company incurred $25,000were in board fees for non-employee directorscompliance with Section 16(a) of the Company. During 2008,Exchange Act of 1934 during the Company granted a total of 150,000 options to purchase common stock to non-employee board members. For the year ended December 31, 2008, the Company recorded $14,520 as stock compensation expense relating to these stock grants.last fiscal year. During the year ended December 31, 2007, the Company paid management fees2009, all of $1,500 to the directors. There is no management or consulting agreements in effect.Accounts payable – related party: As of September 1, 2008, the Company settled all amounts owed to former director and majority shareholder, amounting to $24,811, outstanding for management fees (the balance was forgiven for no consideration). The amount outstanding was recorded as an increase to additional paid-in capital. As of December 31, 2008 and 2007 accounts payable to related parties were $12,077 and $23,812 respectively.Rent:Until August 31, 2008, the Company’s administrative officedirectors, executive officers and Company’s common stock were in compliance with section 16(a) of the Exchange Act of 1934.locateda general partner or executive officer either at 1628 West 1stAvenue, Suite 216, Vancouver, British Columbia, Canada, V6J 1G1. This premisethe time of the bankruptcy or within two years prior to that time;ownedsubject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
parties); andcorporation controlledformer director and majority shareholder. The Company paid rentstock, commodities or derivatives exchange or other self-regulatory organization.$6,663 and $7,812 for the years ended December 31, 2008 and 2007, respectively. Effective September 1, 2008, the Company closed its administrative office in Vancouver, British Columbia, Canada, terminating all of its employees. There were no severance arrangements with any of the terminated employees.On December 31, 2007, 40,000,000 common shares owned by Mr. Harmel S. Rayat, a director and major shareholder of the Company, originally subscribed for at $0.0033 each were returned to the Company for cancellation and for no consideration. Mr. Harmel S. Rayat was an officer and director of the Company until September 12, 2008 and a majority stockholder of the Company until September 9, 2008.All related party transactions are recorded at the exchange amount established and agreed to between related parties and are in the normal course of business.Compensation of Directors directors’ compensation for serving on the Board and its committees. In establishing director compensation, the Board is guided by the following goals:· Compensation should consist of a combination of cash and equity awards that are designed to fairly pay the directors for work required for a company of our size and scope; · Compensation should align the directors’ interests with the long-term interests of stockholders; and · Compensation should assist with attracting and retaining qualified directors. combinationfirm of cash and equity awards that are designed to fairly paywhich Mr. Sierchio is a member, is our legal counsel. In the directors for work required on behalffiscal year ended December 31, 2010 Sierchio & Company was paid a total of a company$<> in legal fees.the size and scope of Entheos Technologies, Inc.;Compensation should align the directors’ interests with the long-term interests of stockholders; andCompensation should assist with attracting and retaining qualified directors.Employment Contracts and Change$3,000 per month in Control ArrangementsOn September 12, 2008, we agreed to pay Mr. Cooper a monthly fee of $2,500 to servehis capacity as our President and Chief Executive Officer. We do not have an employment agreement with Mr. Cooper is not an employeeCacace.Company., ThereBoard.Name Fees earned or paid in cash (1) Stock awards Aggregate Grant Date Fair Value Option awards Aggregate Grant Date Fair Value Non-equity incentive plan compensation Nonqualified deferred compensation earnings All other compensation (2) Total Jeet Sidhu $ 20,000 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 34,820 Christian Hudson $ 0 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 14,820 (1) The amounts in this column represent the monthly compensation. Mr. Sidhu resigned August 26, 2010. (2) The amounts in this column represent stock-based compensation expense granted to Mr. Sidhu and Mr. Hudson (50,000 stock options each) for stock options granted on September 12, 2008. The exercise price per share is $1.00; the options vest at the rate of 10,000 per annum in arrears commencing September 12, 2009. The Options terminated upon Mr. Hudson’s resignation on August 26, 2010. no written agreement between usessential for effective risk management and Mr. Cooper regarding this arrangement. In addition, Mr. Cooperoversight. Members of our board meet regularly with our chief executive officer to discuss strategy and risks facing the company. Our chief executive officer attends the quarterly board meetings and is available to address any questions or concerns raised by the board on risk management-related and any other matters. Our chief executive officer is also agreedasked to serve as one our directors and in consideration thereof and was granted 50,000 options vesting evenly over a five year period oncontribute to the issuance anniversary date. On January 9, 2009, Derek J. Cooper was named the Chief Financial Officer after the resignationagenda for these meetings, so that each functional division of the Frank Fabio. This arrangement was mutually acceptable by both parties duecompany can identify topics that may require board attention. Each quarter our chief executive officer presents to the limitedboard on strategic matters involving our operations ofand strategic initiatives and discusses with the Company.RecommendationsTHE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS VOTE FOR EACH OF THE NOMINEES FOR DIRECTOR ("PROPOSAL 1") AND VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF PETERSON SULLIVAN, LLP AS THE COMPANY'S INDEPENDENT AUDITOR FOR THE FISCAL YEAR ENDING DECEMBER 31, 2009 ("PROPOSAL 2")PROPOSAL NO. 1:ELECTION OF BOARD MEMBERSNomineesThe Company's Board of Directorsboard key strategies, challenges, risks, and opportunities f or the company.currently comprised of three directors. Each of the nominees is presently a director of the Company. If so directed in the enclosed proxy, the persons named in such proxy will vote the shares represented by such proxyresponsible for the electionday-to-day management of risks the following named nomineescompany faces, while the board, as a whole and through its committees, is responsible for the officeoversight of directorrisk management. In its risk oversight role, the board of directors monitors whether the Company, to hold office until the next annual meeting of the stockholders or until their respective successors shall have been duly electedrisk management processes that management has designed and shall have been duly qualified.Information Concerning NomineesNameAgePositionDirector/Officer SinceDerek Cooper 32 President, CEO, Director September 12, 2008 Christian Hudson 44 Director September 12, 2008 Jeet Sidhu 37 Director September 12, 2008 Each of Messrs. Cooper, Hudsonimplemented are effective both as designed and Sidhu were initially appointed to the Company’s Board of Directors on September 12, 2008.The Board of Directors does not contemplate that any of the above-named nominees for director will refuse or be unable to accept election as a director of the Company, or be unable to serve as a director of the Company. Should any of them become unavailable for nomination or election or refuse to be nominated or to accept election as a director of the Company, then the persons named in the enclosed form of proxy intend to vote the shares represented in such proxy for the election of such other person or persons as may be nominated or designated byexecuted.Directors. No nominee is related by blood, marriage, or adoptionDirectors another nominee or to any executive officer of the Company or its subsidiaries or affiliates.Assuming the presence of a quorum, each of the nominees for director of the Company requires for his election the approval of a plurality of the votes cast by the shares of Common Stock entitled to vote at the Annual Meeting.The Board of Directors regard all of the individuals being nominated to the Board as extremely competent professionals with many years of experience in different fields of endeavor, including sales and marketing, management, technology development, and corporate finance and development. The Board feels that this collective base of experience and knowledge is crucial in the overall development of the Company's business.Information Concerning Current Officers and DirectorsThe following narrative describes the positions held by the Company's current officers and directors. During 2008, each board member attended at least 75% of the board meetings that were held while they were in office.DEREK COOPER P.Eng (AGE 32). President, Chief Executive Officer, Director. Mr. Cooper earned his Bachelor of Science degree in Physics in 2001 and his Bachelor of Applied Science in Geological Engineering in 2005, both at the University of British Columbia. From January 2003 through September 2003, Mr. Derek J. Cooper joined Syncrude Canada Ltd., the world’s largest producer of crude oil from oil sands. While completing his Applied Sciences degree, from June 2004 thru September 2004, Mr. Cooper undertook and completed a near-term engineering-exploration contract with Stealth Minerals Ltd. From 2005 to March 2008, Mr. Cooper worked at Elk Valley Coal, the world’s second largest producer of metallurgical coal, as a Planning Engineer. In April 2008, Mr. Cooper joined TransAlta Utilities, as an Intermediate Engineer in the Fuel Supply Group where he performs life-of-mine planning, costing, and capital equipmen t selection as well as scoping/feasibility projects. Mr. Cooper joined the Company as Director on September 12, 2008. Mr. Cooper also serves as a director of International Energy, Inc.Mr. Cooper has served on the Board of Directors, since September 12, 2008.CHRISTIAN HUDSON (AGE 44). Director. Mr. Hudson earned a Bachelorincluding to any of Arts degree in Economics from the University of California, Santa Barbara in 1987 and also earned a Masters in Business Administration from Columbia University in 1991. From 2002 to 2008, Mr. Hudson served as Chief Information Officer at Swiss American Securities Inc., memberour non-management directors, our Chairman or any committee of the Credit Suisse Group. Mr. Hudson isBoard by writing to them at Entheos Technologies, Inc., 430 Park Avenue, Suite 702, New York, New York 10022, c/o President and Chief Executive Officer, who will distribute all stockholder communications to the intended recipients.pursuing entrepreneurial opportunities within Financial Serviceshave a standing Audit Committee. The full Board performs the principal functions of the Audit Committee. The full Board monitors the Company's financial reporting process and Real Estate markets.Mr. Hudson has served oninternal control system and reviews and appraises the audit efforts of the Company's independent registered public accounting firm.since September 12, 2008.JEET SIDHU (AGE 37). Director. Mr. Sidhu graduated fromcurrently consists of three members. Directors serve for a term of one year and stand for election at our annual meeting of stockholders. Pursuant to our Bylaws, any vacancy occurring in the British Columbia Instituteboard of Technologydirectors, including a vacancy created by an increase in the number of directors, may be filled by the stockholders or by the affirmative vote of a majority of the remaining directors though less than a quorum of the board of directors. A director elected to fill a vacancy shall hold office only until the next election of directors by the stockholders. If there are no remaining directors, the vacancy shall be filled by the stockholders.Diploma in Corporate Finance in 1995. Since 2002, Mr. Sidhu has been Vice-Presidentgroup.Montgomery Asset Management Corporation, a privately held firm providing financial and management consulting services to emerging growth corporations.Mr. Sidhu has servedcommon stock beneficially owned are reported on the Boardbasis of Directors since September 12, 2008.Name of Beneficial Owner 1420525 Alberta Ltd. (4) 1628 West 1st Avenue, Suite 216 Vancouver, BC V6J 1G1 25,314,800 40 Antonino Cacace 500,000 * David Jenkins 3,500,000 5.5 % Joseph Sierchio 500,000 * All directors and executive officers as a group (three persons) 4,500,000 7.1 % Section* Less than 1%Beneficial Ownership Reporting Compliance(the "Exchange Act"), requires the Company'sour directors and executive officers and any persons who beneficially own more than 10 percent10% of a registered class of the Company's equity securities,our common stock to file reports of ownership and changes in ownership with the Securities and Exchange Commission ("the Commission"). Directors, officers and greater than 10 percent beneficial ownersSEC (and, if such security is listed on a national securities exchange, with such exchange), various reports as to ownership of such common stock. Such persons are required by applicableSEC regulations to furnish the Companyus with copies of all Section 16(a) forms they file with the Commission pursuant to Section 16(a).file. Based solely upon aon our review of the copies of the forms furnished to the Company,such reports and written representations from certain reporting persons, the Company believes that during the fiscal year ended December 31, 2009, all filings required by our executive officers, directors and greater than 10% beneficial owners under Section 16(a) were timely made.Section 16(a) filing requirements applicable to its directorsCompany incurred $50,435 and $25,000, respectively, in board fees for our non-employee directors. In addition, we recorded $29,640 and $14,520 as stock-based compensation expense for the years ended December 31, 2009 and December 31, 2008, respectively. Audit fees $ 49,477 $ 13,417 Tax fees 4,343 7,467 Total $ 53,820 $ 20,884 satisfied.DirectorNamed Executive Officers”).Name and Principal Position Year Salary Other Options Awards Total 2009 $ 0 $ 44,474(1) $ 0 $ 44,474 (1) Other compensation represents $30,000 in fees paid Derek Cooper as a Director of the Company and $14,474 in stock-based compensation expense for awards granted to Mr. Cooper on September 12, 2008, for his services as one of our directors. We agreed to pay Mr. Cooper a monthly fee of $2,500 to serve as a member of our Board of Directors and to serve as our President and Chief Executive Officer. There is no written agreement between us and Mr. Cooper regarding this arrangement. Mr. Cooper currently does not devote his full time and attention to our affairs; we do not have any agreement with Mr. Cooper regarding his agreement to serve as an officer. He is, in fact, an independent contractor, and not an employee. On January 9, 2009, Derek J. Cooper was named the Chief Financial Officer after the resignation of Frank Fabio. On September 12, 2008, Mr. Cooper was granted 50,000 options vesting evenly over a five year peri od on the issuance anniversary date. These options terminated upon Mr. Cooper’s resignation on August 27, 2010. Name Equity Incentive Awards: Number of Securities Underlying Unexercised Unearned Options % of Total Options Granted to Employees in 2009 Exercise Price ($/sh) Expiration Date Derek J. Cooper (1) 10,000 40,000 0 0 % $ 1.00 9/12/2018 (1) On September 12, 2008, we granted stock options to purchase up to a total of 50,000 shares of common stock to Mr. Cooper. The stock options have an exercise price of $1.00 per share; the closing price of our common stock on September 12, 2008 was $0.75 per share. The options vest in five equal annual installments of 10,000 options commencing on September 12, 2009, and annually thereafter with final vesting occurring on September 12, 2013. Under the terms of the stock option agreement, the agreement will terminate and there will be no further vesting of options effective as of the date that the executive ceases to be an officer. Mr. Cooper resigned on August 21, 2010. Compensation should consist of a combination of cash and equity awards that are designed to fairly pay the directors for work required on behalf of a company of the size and scope of Entheos Technologies, Inc.Compensation should align the directors’ interests with the long-term interests of stockholders; andCompensation should assist with attracting and retaining qualified directors.We do not pay director compensation to directors who are also employees. Mr. Cooper is not an employee and thus gets compensated at the rate of $2,500 per month. Other· Compensation should consist of a combination of cash and equity awards that are designed to fairly · pay the directors for work required for a company of our size and scope; · Compensation should align the directors’ interests with the long-term interests of stockholders; · and · Compensation should assist with attracting and retaining qualified directors. not serving as officers receive between $2,000$1,500 and $2,500 per month for their services as directors;directors plus $500 for each director isboard meeting attended in excess of five per year. Directors are entitled to be reimbursedparticipate in our 2001 Incentive Stock Option Plan. We also reimburse our directors for reasonable and necessaryany actual expenses incurred on our behalf.THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH OFTHE INDIVIDUALS NOMINATED FOR ELECTION AS A DIRECTOR.PROPOSAL NO. 2:THE RATIFICATION OF THE APPOINTMENT OF PETERSON SULLIVAN, LLPAS THE COMPANY’S INDEPENDENT AUDITORBoard of Directors has selected Peterson Sullivan, LLP as independent auditors for the Companytable below outlines director compensation for the fiscal year endingended December 31, 2009:Name Fees earned or paid in cash (1) Stock awards Aggregate Grant Date Fair Value Option awards Aggregate Grant Date Fair Value Non-equity incentive plan compensation Nonqualified deferred compensation earnings All other compensation (2) Total Jeet Sidhu $ 20,000 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 34,820 Christian Hudson $ 0 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 14,820 (1) The amounts in this column represent the monthly compensation. (2) The amounts in this column represent stock-based compensation expense granted to Mr. Sidhu and Mr. Hudson (50,000 stock options each) for stock options granted on September 12, 2008. The exercise price per share is $1.00; the options vest at the rate of 10,000 per annum in arrears commencing September 12, 2009. Each of Messrs. Sidhu and Hudson resigned on August 26, 2010. subjectand 2008 for services as a director.ratificationmultiple stockholders who share an address unless that nominee or the Company has received contrary instructions from one or more of the selection by stockholders. Peterson Sullivan, LLP has served as independent public accountants forWe will deliver promptly, upon written or oral request, a separate copy of this proxy statement and the Company since March 13, 2006.Toannual report to a stockholder at a shared address to which a single copy of the knowledgedocument was delivered. A stockholder who wishes to receive a separate copy of our proxy statements and annual reports, now or in the future, should submit a written request to the Company at no time has Peterson Sullivan, LLP had any direct or indirect financial interest in or any connection with the Company or any430 Park Avenue, Suite 702, New York, New York. Beneficial owners sharing an address who are receiving multiple copies of its subsidiaries other than in connection with services renderedproxy materi als and annual reports and wish to the Company as described below.It is not expected that the representativesreceive a single copy of Peterson Sullivan, LLP or any other auditors will attend the Annual Meeting. Peterson Sullivan, LLP has not indicated their desire to make a statement. They will respond to written questions submitted to the Company.During and for the year ended December 31, 2008, Peterson Sullivan, LLP provided the following audit, audit-related and other professional services for the Company. The services were as follows:the audit of the annual financial statements includedsuch materials in the Company’s Form 10-K;Consultation in connection with various tax and accounting matters; andCertainfuture will need to contact their broker, bank or other professional services.The costnominee to request that only a single copy of providing these services during, and foreach document be mailed to all stockholders at the year ended December 31, 2008, by specified categories, were as follows:Audit Fees: A total of $20,884 was paid with respect to the audit of the Company’s annual financial statements.Financial Information Systems Design and Implementation Fees:NoneAll Other Fees:NoneTHE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF PETERSON SULLIVAN, LLP AS THE COMPANY'S INDEPENDENT AUDITOR.OTHER MATTERSThe board of Directors is not aware of any business to come before the Annual Meeting other than the matters described above in this proxy statement. If any other matters should properly come before the meeting, however, it is intended that proxiesshared address in the accompanying form will be voted with respect to those matters in accordance with the judgment of the person or persons voting the proxies. We will bear the cost of solicitation of proxies.WHERE YOU CAN FIND ADDITIONAL INFORMATIONWe have filed with the SEC, located on 100 F Street NE, Washington, D.C. 20549, Current Reports on Form 8-K, Quarterly Reports on Form 10-Q, Annual Reports on Form 10-K, and other reports, statements and information as required under the Exchange Act.The reports, statements and other information that we have filed with the SEC may be read and copied at the SEC's Public Reference Room at 100 F Street NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.The SEC maintains a web site (http://www.sec.gov.) that contains the registration statements, reports, proxy and proxy statements and other information regarding registrants that file electronically with the SEC such as us. You may access our SEC filings electronically at this SEC website. These SEC filings are also available to the public from commercial document retrieval services.The Company hereby undertakes to provide without charge to each person, including any beneficial owner, to whom a copy of this Proxy Statement has been delivered, on the written request of any such person, a copy of the Company's most recent Form 10-K/A. Written requests for such copies should be directed to Derek Cooper, the President of the Company, at 888 3rd Street SW, Suite 1000, Calgary, AB T2P 5C5.
future.ANNUALMEETING2010 annual2011 Annual meeting of stockholders, they must deliver a written copy of their proposal no later than August 16, 2009.July 14, 2011. If the date of next year’s annual meeting is changed by more than 30 days from the date of this year’s meeting, then the deadline is a reasonable time before we begin to print and mail proxy materials. Proposals must be timely received and comply with the proxy rules relating to stockholder proposals, in particular Rule 14a-8 under the Securities Exchange Act of 1934, in order to be included in our proxy materials.Mailing InstructionsProposals should be deliveredDerek Cooper, the Presidenteach person to whom a proxy statement is delivered:Company, at 888 3rd Street SW, Suite 1000, Calgary, AB T2P 5C5. To avoid controversy and establish timely receiptinformation that has been incorporated by reference in the Company, it is suggested that stockholders send their proposals by certified mail, return receipt requested.SHAREHOLDER COMMUNICATIONSThe Company has a process for shareholders who wish to communicateproxy statement, but not delivered with the Boardproxy statement;Directors. Shareholders who wish to communicate with the Board may write to itproxy statement or any other information, which we filed at the Company’sSEC's public reference rooms in Washington, D.C., New York City and Chicago, Illinois. The address given above. These communications will be reviewedfor the SEC's public reference room in Washington, D.C. is U.S. Securities and Exchange Commission, 100 "F" Street, N.E., Washington, DC 20549. You may request copies of these documents, upon payment of a duplicating filing fee, by one or more employeeswriting to the SEC. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information on the operation of the Company designated bypublic reference rooms. Our SEC filings are also available to you free of charge at the Board, who will determine whether they should be presentedSEC's web site at http://www.sec.gov.the Board. The purposeArticles of this screening isIncorporation
ROSS MILLER *090201* Secretary of State 204 North Carson Street, Suite 1 Carson City, Nevada 89701-4520 (775) 684 5708 Website: www.nvsos.gov USE BLACK INK ONLY - DO NOT HIGHLIGHT ABOVE SPACE IS FOR OFFICE USE ONLY allow the BoardArticles of Incorporationavoid having to consider irrelevant or inappropriate communications.NRS 78.385 and 78.390 - After Issuance of Stock)1. Name of corporation: Entheos Technologies, Inc. 2. The articles have been amended as follows: (provide article numbers, if available) Article 1. The name of this corporation is Janus Resources, Inc. favor of the amendment is: % 4. Effective date of filing: (optional) (must not be later than 90 days after the certificate is filed) 5. Signature: (required) Signature of Officer ENTHEOS TECHNOLOGIES, INC.*If any proposed amendment would alter or change any preference or any relative or other right given to any class or series of outstanding shares, then the amendment must be approved by the vote, in addition to the affirmative vote otherwise required, of the holders of shares representing a majority of the voting power of each class or series affected by the amendment regardless to limitations or restrictions on the voting power thereof. This form must be accompanied by appropriate fees. Nevada Secretary of State Amend Profit-After Revised: 3-6-09 888 3RD STREET SW, SUITE 1000CALGARY, AB T2P 5C5
10-K x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 2009 OF THE SECURITIES EXCHANGE ACT OF 1934 Nevada 98-0170247 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 888 3rd Street SW, Suite 1000, Calgary, Alberta, Canada T2P 5C5 (Address of principal executive offices) (Zip Code) $15,217,661. Common shares held by each officer and director and by each person who owns 5% or more of the outstanding common shares have been excluded in that such persons may be deemed affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes. PART I Email Solutions, Inc. was dissolved during 2008. us. such utilizing finder's fee agreements and consulting agreements. Rule 4-10 “reservoirs are considered proved if economic producibility is supported by either actual production or a conclusive formation test.” These wells are supported by actual production. The Company has not yet obtained reserve studies providing proved reserve quantities due to the recentness of the acquisition of these properties and due to the wells still being in their initial testing phase. Management is assessing and compiling production data to determine the need for reserves studies going forward. anticipated salvage value of the equipment. respectively. $50.16 and $71.35, respectively. $5.55 and $7.46, respectively. program in the reservoir, provides support for the engineering analysis on which the project or program was based. Estimates of proved reserves do not include the following: (a) oil that may become available from known reservoirs but is classified separately as “indicated additional reserves”; (b) crude oil, natural gas and natural gas liquids, the recovery of which is subject to reasonable doubt because of uncertainty as to geology, reservoir characteristics or economic properties. Legal proceedings. Fiscal Year 2008 High ($) Low ($) Fourth Quarter $ 2.00 $ 0.38 Third Quarter $ 0.75 $ 0.38 Second Quarter $ 0.55 $ 0.41 First Quarter $ 0.82 $ 0.41 Fiscal Year 2007 Fourth Quarter $ 0.85 $ 0.81 Third Quarter $ 0.97 $ 0.62 Second Quarter $ 0.69 $ 0.61 First Quarter $ 1.40 $ 0.60 January 1, 2009 – April 8, 2009 0.51 0.41 record. Except as set forth above, there are no restrictions that currently materially limit our ability to pay dividends or which we reasonably believe are likely to limit materially the future payment of dividends on common stock. Acquisition Costs Exploration Costs Development Costs Total Cooke #6 181,535 - - 181,535 Onnie Ray #1 14,800 7,000 41,857 63,657 Haile #1 16,071 57,675 - 73,746 Stahl #1 15,215 7,000 35,141 57,356 Pearce #1 6,978 11,200 47,556 65,734 234,599 82,875 124,554 442,028 Impairment of oil properties (93,444) Oil and gas properties, net 348,584 estimated closure costs. oil and gas properties. 2009 without material impact on our financial statements as we have no proved reserves. For Years Ended December 31, 2008 2007 Production Data: Oil (bbl) 114.9 - Natural gas (mcf) 746.6 - Average Sales Price: Oil (per bbl) $ 71.35 - Natural gas (per mcf) $ 7.46 - the Series A and Series B Warrants, respectively, for the year ended December 31, 2009. year ended December 31, 2009. fund operations. we recorded $14,474 and $4,840 as stock compensation expense Notes to Financial Statements) for the years ended December 31, 2009 and December 31, 2008, respectively. ENTHEOS TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS December 31, 2008 and December 31, 2007 (Expressed in U. S. Dollars) 2008 2007 ASSETS Current assets Cash and cash equivalents $ 2,734,591 $ 46,306 Accounts receivable 4,252 - Prepaid expenses 720 - Total current assets 2,739,563 46,306 Oil and gas properties, using full cost method Proven properties 368,282 - Unproven properties 73,746 - Accumulated depreciation, depletion and amortization and impairment (93,444) - Oil and gas properties, net 348,584 - Total assets $ 3,088,147 $ 46,306 LIABILITIES Current liabilities Accounts payable and accrued liabilities $ 50,854 $ 1,300 Accounts payable - related parties (Note 5) 12,077 23,812 Total liabilities 62,931 25,112 STOCKHOLDERS' EQUITY Stockholders' equity Preferred stock:$0.0001 par value: Authorized: 10,000,000 shares Issued and outstanding: nil - - Common stock: $0.00001 par value; Authorized: 200,000,000 shares Issued and outstanding: 63,075,122 shares (2007: 56,625,122) 631 566 Additional paid-in capital 7,107,622 3,838,516 Accumulated deficit (4,083,037) (3,817,888) Total stockholders' equity 3,025,216 21,194 Total liabilities and stockholders' equity $ 3,088,147 $ 46,306 (The accompanying notes are an integral part of these consolidated financial statements) ENTHEOS TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS for the years ended December 31, 2008 and 2007 (Expressed in U. S. Dollars) 2008 2007 Revenue Oil and gas sales $ 13,770 $ - Expenses Oil and gas production and operating costs 9,080 - General and administrative expenses 190,693 27,610 Impairment of oil and gas properties 93,444 - Total operating expenses 293,217 27,610 Operating Loss (279,447) (27,610) Other income Interest income 14,297 2,928 14,297 2,928 Net loss attributable to common stockholders $ (265,149) $ (24,682) Loss per common share -basic and diluted $ 0.00 $ 0.00 Weighted average number of common shares outstanding- basic and diluted 59,374,302 96,515,533 (The accompanying notes are an integral part of these consolidated financial statements) ENTHEOS TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY for the years ended December 31, 2008 and December 31, 2007 (Expressed in U. S. Dollars) Total Common Stock Additional Accumulated Stockholder's (Expressed in U. S. Dollars) Shares Amount paid-in capital earnings (deficit) Equity Balance, December 31, 2006 96,625,122 $ 966 $ 3,838,116 $ (3,793,206) $ 45,876 Cancellation of common shares at $0.0033 per share (40,000,000) (400) 400 - - Net loss, year ended December 31, 2007 - - - (24,682) (24,682) Balance, December 31, 2007 56,625,122 566 3,838,516 (3,817,888) 21,194 Units issued for cash and legal services at $0.50 per share in July 2008 6,450,000 65 3,224,935 - 3,225,000 Stock based compensation expense - - 19,360 - 19,360 Settlement of related party payables - - 24,811 - 24,811 Net loss, year ended December 31, 2008 - - - (265,149) (265,149) Balance, December 31, 2008 63,075,122 $ 631 $ 7,107,622 $ (4,083,037) $ 3,025,216 ENTHEOS TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS for the years ended December 31, 2008 and 2007 (Expressed in U. S. Dollars) 2008 2007 Cash flows from (used in) operating activities Net loss $ (265,149) $ (24,682) Impairment of oil and gas properties 93,444 - Stock-based compensation 19,360 - Stock issued for legal services 25,000 - Change in non-cash working capital item: Decrease in accounts receivable - related party - 84,088 Increase in accounts receivable (4,252) - Increase in prepaid assets (720) - Increase (decrease) in accounts payable & accrued liabilities 62,630 (13,278) Net cash flows provided by (used in) operating activities (69,687) 46,128 Cash flows (used in) investing activities Acquisition of oil and gas properties (442,028) - Net cash used in investing activities (442,028) - Cash flows from financing activities Proceeds from issuance of common stock, net 3,200,000 - Net cash provided by financing activities 3,200,000 - Increase in cash and cash equivalents 2,688,285 46,128 Cash and cash equivalents, beginning of period 46,306 178 Cash and cash equivalents, end of period $ 2,734,591 $ 46,306 Supplemental disclosure of cash flow information: Interest paid in cash $ - $ - Income tax paid in cash $ - $ - Supplemental schedule of non-cash investing and financing activites: Settlement of related party payables $ 24,811 $ - (The accompanying notes are an integral part of these consolidated financial statements) ENTHEOS TECHNOLOGIES, INC. 2009“Company”“Company”) hereby constitutes and appoints each of Mr. Derek CooperDavid Jenkins and Mr. Jeet SidhuJoseph Sierchio the attorney, agent and proxy of the undersigned, with full power of substitution, for and in the name, place and stead of the undersigned, to vote and act with respect to all of shares of the Common Stock of the Company standing in name of the undersigned or in respect of which the undersigned is entitled to vote, with all powers of the undersigned would process if personally present at such meeting upon the following matters, and otherwise in his discretion: FOR AGAINSTFORAGAINST ABSTENTION ITEM 1. To elect directors to serve until the next annual meeting of stockholders or until their successors are elected and have qualified. are elected and have qualified. Mr. Antonino Cacaceo o o Mr. Derek Cooper David Jenkins[ ] o[ ] o[ ] o Mr. Christian Hudson Joseph Sierchio[ ] o[ ] o[ ] o Mr. Jeet Sidhu [ ] [ ] [ ] ITEM 2. To ratify the appointment of Peterson Sullivan, LLP [ ] [ ] [ ] for the fiscal year ending December 31, 2009 2010o o o ITEM 3. To approve an amendment to the Company’s Articles of Incorporation changing its name to Janus Resources, Inc.; o o o ITEM 3.4. To transact any such other business as may [ ] [ ] [ ] properly come before the meeting or an adjournment (s) therefore. o o o thethe discretion of the proxy holder.Please date, sign and print your name on this proxy exactly as your name appears on your stock certificate and return immediately to the address printed above.SIGNATURE:_____________________________WASHINGTON,10-K/AAmendment No. 12008underpursuant to Section 12(g) of the Exchange Act:Title of ClassName of Exchange on Which RegisteredCommon Stock, $0.00001 par valueOTC Bulletin Board (OTCBB)29
Yes o No o N/A x x20082009 as reported on the OTC Bulletin Board was $28,878,812.April 9, 2009,March 25, 2010, there were 63,075,122 shares of the registrant’s Common Stock outstanding.EXPLANATORY NOTEThis Form 10-K/A (the “Amendment”) is being filed by Entheos Technologies, Inc. (the “Company”) and amends the Company’s Annual Report on Form 10-K for the year ended December 31, 2008. This Form 10-K/A replaces in its entirety the Form 10-K that was filed with the Securities and Exchange Commission (the “SEC”) on April 15, 2009 (the “Original Filing”). This Amendment corrects the following errors and omissions in the Company’s original Form 10-K: 1. To reflect the conformed signature in the Report of Independent Registered Public Accounting Firm in Part II, Item 8.2. To correct a typographical error in Part II, Item 5 to properly reflect the Company’s stock high sale price during the fourth quarter of 2008 from $1.15 to $2.00.3. To correct certain typographical errors in Part III, Item 11 as follows:a. to properly describe the information provided regarding Stock Options Granted During the Last Fiscal Year from officers and directors to just officers;b. to properly describe the information provided regarding AggregatedOption Exercised During Last Fiscal Year and Year End Option Values from officers and directors to just officers;c. to correct the description of Derek Cooper’s unexercised stock options from “Market Value of all In-the-Money Options” to “Market Value of all Unexercised Stock Options”; andd. to properly reflect the fair market value of Derek Cooper’s unexercised stock options as of December 31, 2008 from $50,000 to $25,500.Except as specifically noted here, this amendment does not modify or update any disclosures in the original Form 10-K. Accordingly, this amendment does not reflect events occurring after the filing of the original Form 10-K or modify or update any disclosures that may have been affected by subsequent events.TABLE OF CONTENTS/A20082009ITEMBUSINESS.
Business.10-K/A10-K for the fiscal year ending December 31, 2008,2009, contain forward-looking statements. Such forward-looking statements include statements regarding, among other things, (a) our projected sales and profitability, (b) our growth strategies, (c) anticipated trends in our industry, (d) our future financing plans, and (e) our anticipated needs for working capital. Forward-looking statements, which involve assumptions and describe our future plans, strategies, and expectations, are generally identifiable by use of the words “may,” “will,” “should,” “could,” “might,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. This information may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from the future results, performance, or achievements expressed or implied by any forward-looking statements. These statements may be found under “Management's Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” “Properties,” as well as in this report generally.10-K/A10-K should be construed as a guarantee or assurance of future performance or results. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks described in this report and matters described in this report generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact occur. These forward-looking statements are based on current expectations, and the CompanyCo mpany assumes no obligation to update this information. Readers are urged to carefully revie wreview and consider the various disclosures made by the Company in this Form 10-K/A10-K and in the Company's other reports filed with the Securities and Exchange Commission that attempt to advise interested parties of the risks and factors that may affect the Company's business.theEntheos” “the Company” “we” “us” and “our”) has an authorized capital of 200,000,000 shares of $0.00001 par value common stock, of which 63,075,122 shares are outstanding and 10,000,000 shares of $0.0001 par value preferred stock, of which none are outstanding.itsour wholly-owned subsidiary Email Solutions, Inc., the Companywe served as an Application Service Provider (“ASP”) providing reliable, real time, high volume outsourced email and search engine optimization services. Due to the limited success of theour ASP business, management decided that it was in the best interest of our stockholders to abandon the Application Service Provider business and focus on identifying undervalued oil and gas opportunities for acquisition, development and exploration. The assets and liabilities, the results of operations and cash flows related to the ASP business were not classified as discontinued operations as the amounts were not significant.888-3888 3rdStreet SW, Suite 1000, Calgary Alberta, Canada T2P 5C5. Our telephone number is (403) 444-6418.10-K/A10-K are not required to be made by the Company. diversified energy company engaged in the acquisition and development of crude oil and natural gas interests in the United States. We pursue oil and gas prospects in partnership with oil and gas companies with exploration, development and production expertise. We currently have a non-operating, minority working interestinterests in five properties. Our prospect areas consist of landproducing properties in La Salle County, LeeFayette County, FayetteLee County and Frio County, Texas. Currently, fourfiveleases are not affiliated with Entheos or any of its directors or major shareholders. We are not aware of any relationships or affiliations between or among any of our leasehold partners and the lease operators.we have a minority working interestthe prospects are producing. We currently do not operate any of the wells in which we have an interest.StrategySubject to economic conditions affecting the oil and gas industry, our strategy is to identify and acquire (i) low risk in-field oil and gas rights that are primarily developmental in nature that offset existing production and (ii) energy services companies that when combined with our management expertise in that area will display strong top line growth and cash flows. Although to date we have acquiredminority working interests we will, if the appropriate properties are available tolocated, engaged by us on terms acceptablean as needed basis. The industry professionals to be utilized by us acquire controlling interestswill be contractors and will be compensated as well.the Companywe acquired a 21.75% working interest (16.3125% net revenue interest) in the Cooke #6 well located at the Cooke Ranch field in La Salle County, Texas which has been producing oil and gas from the Escondido formation since 2007. In September 2008, the Company acquired a 20.00% working interest (15.00% net revenue interest) in Onnie Ray #1 Well in Lee County, Texas and the Stahl #1 Well in Fayette County, Texas which were subsequently re-entered and are producing oil and gas from the Austin Chalk formation and a 20.00% working interest (15.00% net revenue interest) in the Haile #1 Well in Frio County, Texas which is currently scheduled for re-entry operations. On October 31, 2008 we acquired a 20.00% working interest (15.00% net revenue interest) in Pearce #1 Well in Frio County, Texas which is currently producingprodu cing oil from the Austin Chalk formation. Acquisition Exploration Development Costs Costs Costs Total Cooke #6 $ 181,535 $ - $ - $ 181,535 Onnie Ray #1 14,800 7,000 41,857 63,657 Haile #1 16,071 57,675 - 73,746 Stahl #1 15,215 7,000 35,141 57,356 Pearce #1 6,978 11,200 47,556 65,734 $ 234,599 $ 82,875 $ 124,554 $ 442,028 Capitalized Costs Relating to Oil and Gas Producing Activities 2009 2008 Proven properties $ 424,191 $ 368,282 Unproven properties 101,682 73,746 525,873 442,028 Impairment of properties (429,338 ) (93,444 ) Oil and gas properties, net $ 96,535 $ 348,584 even into northwest Louisiana. The Austin Chalk in central Texas has been and continues to be explored and developed for its oil and gas potential by companies such as Anadarko Petroleum Corporation, Chesapeake Energy Corporation, and Exxon Mobil Corporation.the Company’sour oil and gas properties is summarized as follows: Month Acquisition Production Date Started Proven Developed Properties: Cooke #6 9/1/2008 Dec-07 Onnie Ray #1 9/12/2008 Oct-08 Stahl #1 9/12/2008 Oct-08 Pearce #1 10/31/2008 Dec-08 Unproven Properties: Haile #1 9/12/2008 - TheAt the time of acquisition, the well iswas not currently supported by actual production nor arewere there defined engineering reserve studies for this well. Anstudies. The well was being recompleted to a zone that was previously productive. Once the recompletion efforts were final and the well did not support production, an exploratory drilling program was started in early 2009 to complete a new unproven upper zone. The new upper zone recompletion also resulted in no oil or gas production and the well was shut-in August 2009. Management has impaired the well to the extent of this well.Research and Development ExpendituresSince inception, we have not incurred any expenditures in research or development.(114.9 bbl) for fiscalthe years ended December 31, 2009 and 2008, respectively, which representedrepresents 79% and 60% of our total oil and gas revenues for the yearyears ended December 31, 2008.2009 and 2008, respectively. Sales of natural gas totaled $10,697 and $5,571 for the years ended December 31, 2009 and 2008, (746.6 mcf).$71.35.$7.46.are in substantial compliancesubstantially comply with all applicable laws and regulations, such laws and regulations are frequently amended or reinterpreted so we are unable to predict the future cost or impact of complying with such laws and regulations.·require the acquisition of a permit before drilling commences;·restrict the types, quantities and concentrations of various substances that can be released into the environment in connection with drilling, production and processing activities;·limit or prohibit drilling activities on certain lands lying within wilderness, wetlands, frontier and other protected areas;·require remedial action to prevent pollution from former operations such as plugging abandoned wells; and·impose substantial liabilities for pollution resulting from operations.· require the acquisition of a permit before drilling commences; · restrict the types, quantities and concentrations of various substances that can be released into the environment in connection with drilling, production and processing activities; · limit or prohibit drilling activities on certain lands lying within wilderness, wetlands, frontier and other protected areas; · require remedial action to prevent pollution from former operations such as plugging abandoned wells; and · impose substantial liabilities for pollution resulting from operations. are in substantial compliancesubstantially comply with current applicable environmental laws and regulations, and we have not experienced any materially adverse effect from compliance with these environmental requirements,r equirements, we cannot assure you that this will continue in the future.resourcesreso urces and for the costs of certain health studies. It is not uncommon for neighboring landowners and other third parties to file claims for personal injury and property damages allegedly caused by the release of hazardous substances or other pollutants into the environment. Furthermore, although petroleum, including natural gas and crude oil, is exempt from CERCLA, at least two courts have ruled that certain wastes associated with the production of crude oil may be classified as “hazardous substances” under CERCLA and thus such wastes may become subject to liability and regulation under CERCLA. State initiatives to further regulate the disposal of crude oil and natural gas wastes are also pending in certain states, and these various initiatives could have an adverse impactsimpact on us.dischargedischa rge mandated under federal or state law may be significant, the entire industry will experience similar costs and we believe that these costs will not have a materially adverse impact on our financial condition and results of operations. Some oil and gas exploration and production facilities are required to obtain permits for their storm water discharges. Costs may be incurred in connection with treatment of wastewater or developing storm water pollution prevention plans.bornebor ne by similarly situated companies in the industry.independents,independent companies , and individuals for the acquisition of leases and properties. Most competitors have financial and other resources which substantially exceed ours. Resources of our competitors may allow them to pay more for desirable leases and to evaluate, bid for and purchase a greater number of properties or prospects than us. Our ability to replace and expand our reserves is dependent on our ability to select and acquire producing properties and prospects for future drilling.Inc,LLC and Leexus Oil LLC. The operators charge the Company, without mark-up, for the Company’s working interest portion of the direct operating costs and overhead costs (which are comprised of administrative, supervision, office services and warehousing costs) that the operators incur with respect to our wells.portio nsportions not yet drilled, but which can be reasonably judged as economically productiveproductiv e on the basis of available geological and engineering data. In the absence of information on fluid contacts, the lowest known structural occurrence of hydrocarbons controls the lower proved limit of the reservoir. Reserves which can be produced economically through application of improved recovery techniques (such as fluid injection) are included in the “proved” classification when successful testing by a pilot project, or the operation of an installedfactors;facto rs; (c) crude oil, natural gas and natural gas liquids that may occur in undrilled prospects; and (d) crude oil, natural gas and natural gas liquids that may be recovered from oil shales, coal, gilsonite and other such sources.provedpr oved effective by actual tests in the area and in the same reservoir.ITEMPROPERTIES.ITEMLEGAL PROCEEDINGS.adverseadve rse or has a material interest adverse to us.Theof the Company was held on December 19, 2008,14, 2009, at which time the stockholders voted on the following proposals:1. The election of a board of directors to serve until the next Annual Meeting or until their respective successors is duly elected and has been qualified. Votes For Votes Against Votes Abstaining Derek J. Cooper 32,678,620 0 0 Jeet Sidhu 32,678,620 0 0 Christian Hudson 32,678,620 0 0 2. Ratifying the appointment of Peterson Sullivan LLP as our auditors for the fiscal year ending December 31, 2008.Votes For Votes Against Votes Abstained 32,678,620 0 0 3.RESOLVED, that the Company to amend the Articles of Incorporation to change the Company’s name to “Sterling Energy, Inc.”Votes For Votes Against Votes Abstained 32,678,620 0 0 Note that the name of the Company has not been legally changed as of the date of this filing.1. The election of a board of directors to serve until the next Annual Meeting or until their respective successors is duly elected and has been qualified. Votes For Votes Against Votes Abstaining Derek Cooper 32,694,232 13,775 0 Jeet Sidhu 32,694,232 13,775 0 Christian Hudson 32,694,232 13,775 0 2. Ratifying the appointment of Peterson Sullivan LLP as our auditors for the fiscal year ending December 31, 2009. Votes For Votes Against Votes Abstained 32,700,242 6,562 1,202 . MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.The Company'sOTCOver the Counter Bulletin Board (“OTCBB”) under the symbol "ETHT". The following table sets forth the high and low sale prices for the periods indicated:On April 8, 2009 the closing price of our common stock as reported on the OTCBB was $0.50 per share. Fiscal Year 2009 High ($) Low ($) Fourth Quarter $ 0.60 $ 0.50 Third Quarter $ 0.50 $ 0.50 Second Quarter $ 0.51 $ 0.50 First Quarter $ 0.51 $ 0.41 Fiscal Year 2008 Fourth Quarter $ 2.00 $ 0.38 Third Quarter $ 0.75 $ 0.38 Second Quarter $ 0.55 $ 0.41 First Quarter $ 0.82 $ 0.41 April 8, 2009,March 22, 2010, there were approximately 329320 stockholders of record of the Company's Common Stock.· We would not be able to pay our debts as they become due in the usual course of business; or · Our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of stockholders who have preferential rights superior to those receiving the distribution. We would not be able to pay our debts as they become due in the usual course of business; orOur total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights ofstockholders who have preferential rights superior to those receiving the distribution. Number of securities remaining available for Number of Securities to Weighted-average exercise future issuance under be issued upon exercise of price of outstanding equity compensation plans outstanding options, options, warrants and (excluding securities warrants and rights rights reflected in column (a)) Plan Category (a) (b) (c) Equity compensation plans approved by security holders 200,000(1) $1.00 119,800,000 Equity compensation plans not approved by security holders Total 200,000 (1) $1.00 119,800,000 Plan Category Equity compensation plans approved by security holders 150,000 (1) $ 1.00 119,850,000 Equity compensation plans not approved by security holders Total 150,000 (1) $ 1.00 119,850,000 (1) 50,000 were granted to our former CFO and were cancelled following his resignation on January 9, 2009. (1) 50,000 were granted to our former CFO and were cancelled following his resignation on January 9, 2009.ActualA ctual results may differ from these estimates under different assumptions or conditions. In addition, the following discussion and analysis contains forward-looking statements that involve risks and uncertainties, including, but not limited to, those discussed in “Forward Looking Statements,” ,” and elsewhere in this Form 10-K/A10-K..OverviewEntheos Technologies, Inc. (“the Company”) is a small independent diversified energy company engaged in the acquisition and development of crude oil and natural gas interests in the United States. The Company pursues oil and gas prospects in partnership with oil and gas companies with exploration, development and production expertise. The Company participates with a non-operating, minority working interest. The Company’s prospect areas consist of land in La Salle County, Lee County, Fayette County and Frio County, Texas.Incorporated under the laws of the State of Nevada, the Company has an authorized capital of 200,000,000 shares of $0.00001 par value common stock, of which 63,075,122 shares are outstanding and 10,000,000 shares of $0.0001 par value preferred stock, of which none are outstanding.From 2002 until September 2008, through our wholly-owned subsidiary Email Solutions, Inc., the Company served as an Application Service Provider (“ASP”) providing reliable, real time, high volume outsourced email and search engine optimization services. Due to the limited success of the ASP business, management decided that it was in the best interest to abandon the Application Service Provider business and focus on identifying undervalued oil and gas opportunities for acquisition, development and exploration. The assets and liabilities, the results of operations and cash flows related to the ASP business were not classified as discontinued operations as the amounts were not significant.WellLocationInterestCooke #6LaSalle County Texas21.75% working interest (16.135% net revenue interest)Stahl #1Fayette County, Texas20.00% working interest (15% net revenue interest)Onnie Ray #1Lee County, Texas20.00% working interest (15% net revenue interest)Haile #1Frio County, Texas20.00% working interest (15% net revenue interest)Pearce #1Frio County, Texas20.00% working interest (15% net revenue interest) Month Acquisition Interest Production Date Working Net Revenue Started Acreage Formation Proven Properties: Cooke #6 9/1/2008 21.75 % 16.3125 % Dec-07 40 Escondido Onnie Ray #1 9/12/2008 20.00 % 15.00 % Oct-08 80 Austin Chalk Stahl #1 9/12/2008 20.00 % 15.00 % Oct-08 20 Austin Chalk Pearce #1 10/31/2008 20.00 % 15.00 % Dec-08 360 Austin Chalk Unproven Properties: Haile #1 9/12/2008 20.00 % 15.00 % - 100 Austin Chalk 2008 can be2009 is summarized as follows: $ $ $ $ $ $ $ $ $ Capitalized Costs Relating to Oil and Gas Producing Activities 2009 2008 $ change % change Proven properties $ 424,191 $ 368,282 $ 55,909 15.2 % Unproven properties 101,682 73,746 27,936 37.9 % 525,873 442,028 83,845 19.0 % Impairment of properties (429,338 ) (93,444 ) (335,894 ) 359.5 % Oil and gas properties, net $ 96,535 $ 348,584 $ (252,049 ) (72.3 %) We plan to grow our business by acquiring (i) low risk in-fieldrights that are primarily developmental in nature that offset existing productionproperties during 2009. The additions to capitalized costs relating to oil and (ii) energy services companies that when combined with our management expertise in that area will display strong top line growth and cash flows. To date we have acquired only minority working interests. We do not operate the wells in which we havegas properties is due to recording an interest.Since inception, we have funded our operations primarily from private placements of our common stock and debt issuances. The Company has recently incurred net operating losses and operating cash flow deficits. It may continue to incur losses from operations and operating cash flow deficits in the future. However, the Company believes its cash and cash equivalent balances, anticipated cash flows from operations and other external sources of credit will be sufficient to meet its cash requirements through March 2010. The future of the Company after March 2010 will depend in large part on its ability to successfully generate cash flows from operations and raise capital from external sources to fund operations.Asasset retirement obligation as of December 31, 2008, we generated revenues2009, continued completion efforts on our unproven property well, Haile #1, and equipment replacements on the Onnie Ray #1 well. $13,770 from operations of our new core business. From inception to$335,894 and $93,444 for the years ended December 31, 2009 and 2008, we have accumulated lossesrespectively. The impairment recognized during 2009 was due to a decline in oil and natural gas prices in the first half of approximately $4,083,000.the year; lower than expected production volumes obtained from our oil and gas wells, the shut-in of an unproven property, Haile #1, and utilizing a 12-month average beginning-of-the-month price instead of a period-end price. The Company completedimpairment is similar to amortization and therefore is not added to the cost of properties being amortized.private placementzone that was previously productive. Once the recompletion efforts were final and the well did not support production, an exploratory drilling program was started in early 2009 to complete a new unproven upper zone. The new upper zone completion also resulted in no oil or gas production and the well was shut-in during August 2009. Management has impaired the well to the extent of anticipated salvage value of the equipment and recorded an asset retirement obligation as of year end to accrue for gross proceeds of $3,225,000 on July 28, 2008. Management believes that its current and future plans will enable it to continue operations through March 31, 2010.of future oil and gas reserves; estimates used in the impairment of oil and gas properties; and the estimated future timing and cost of asset retirement obligations.The Company hasitsour oil and gas activities. In accordance with the full cost method of accounting, all costs associated with acquisition, exploration, and development of oil and gas reserves, including directly related overhead costs and related asset retirement costs, are capitalized.The Company hasWe have not yet obtained reserve reports because of itsour recent acquisition of itsour oil and gas properties and because these properties recently began producing. Management is assessing geographic and production data to determine the need for reserves studies. At December 31,2008, 2009, there were no capitalized costs subject to amortization.the Company evaluateswe evaluate historical experience, current drilling results, lease expiration dates, current oil and gas industry conditions, international economic conditions, capital availability, and available geological and geophysical information. As a result of this analysis the Companyand lack of proved reserves, we recorded an impairment loss of $93,444. This$335,894 and $93,444 during 2009 and 2008, respectively. The impairment is similar to amortization and thereforetherefor e is not added to the costcosts of properties being amortized.The Company didWe have not sellsold any properties during 2008 or 2007. basically limits capitalized costs to the sum of the estimated future net revenues from proved reserves, discounted at 10% per annum to present value, based on current economic and operating conditions, adjusted for related income tax effects.The Company recognizesand distribute and disburse funds to various working interest partners and royalty owners, the collection of revenues from oil and gas production may take up to 45 days following the month of production. Therefore, the Companywe may make accruals for revenues and accounts receivable based on estimates of itsour share ofo f production. Since the settlement process may take 30 to 60 days followin gfollowing the month of actual production, itsour financial results may include estimates of production and revenues for the related time period. The CompanyWe will record any differences between the actual amounts ultimately received and the original estimates in the period they become finalized. As of December 31, 2008, all revenue and expense information had been received from the operators so there was no estimated revenue or expense.The Company has adopted the provisions of SFAS 143,“AccountingAsset Retirement Obligations.” SFAS 143 amended SFAS 19,“Financial Accounting and Reporting by Oil and Gas Producing Companies,”and, among other matters, addresses financial accounting and reporting for legal obligations associated with the retirement of tangible long-lived assets and the associatedour future asset retirement costs. SFAS No. 143 requires thatobligations by recording the fair value of athe liability for an asset retirement obligation be recognized induring the period in which it is incurred, with thewas incurred. The associated asset retirement costcosts are capitalized as part of the relatedcarrying amount of the long-lived asset. The increase in carrying value of a property associated with the capitalization of an asset retirement cost is included in proved oil and allocated to expense overgas properties in the asset’s useful life.In March 2005, the FASB issued FASB Interpretation No. 47 (“FIN No. 47”),Accounting for Conditional Asset Retirement Obligations. FIN No. 47 clarifies that a conditionalbalance sheets. Our asset retirement obligation consists of costs related to the plugging of wells, removal of facilities and equipment and site restoration on our oil and gas properties and gathering assets. The asset retirement liability is allocated to operating expense using a systematic and rational method.SFAS 143, refersthe valuation methodologies in measuring fair value:a legal obligation to perform an asset retirement activityaccess. We have no assets or liabilities valued with Level 1 inputs.whichmarkets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the timing or methodfull term of the settlementassets or liabilities. We have no assets or liabilities valued with Level 2 inputs. conditional on a future eventsupported by little or no market activity and that may or may not be within the control of the entity. Accordingly, an entity is requiredare significant to recognize a liability for the fair value of the assets or liabilities. Liabilities valued with Level 3 inputs are described in “Note 5. Stockholders’ Equity” in the Notes to Financial Statements.conditional asset retirement obligation if12-month average beginning-of-the-month price when calculating the fair value can be reasonably estimated.The Company does not have material asset retirement obligationsquanti ties of proved reserves and performing the full-cost ceiling test calculation. Other key revisions were the inclusion of non-traditional resources in reserves, the allowance for use of new technologies in determining reserves, optional disclosure of probable and possible reserves and significant new disclosures. We adopted this guidance as of December 31, 2008 or 2007.The following table summarizes 2009 2008 change % change Production: Oil (Bbls) 806.1 113.9 692.2 608 % Gas (Mcf) 1,927.0 746.6 1,180.4 158 % Total production (BOE) 1,127.3 238.3 888.9 373 % Average daily production (BOE) 3.1 2.9 0.2 7 % % oil of production 72 % 48 % 24 % 50 % Average sales price: Oil (per Bbl) $ 50.16 $ 71.98 $ (21.82 ) (30 %) Gas (per Mcf) $ 5.55 $ 7.46 $ (1.91 ) (26 %) Total (per BOE) $ 45.36 $ 57.78 $ (12.42 ) (21 %) Oil and gas revenues: Oil revenue $ 40,437 $ 8,199 $ 32,238 393 % Gas revenue $ 10,697 $ 5,571 $ 5,126 92 % Total $ 51,134 $ 13,770 $ 37,364 271 % Lease operating expenses $ 42,984 $ 9,080 $ 33,904 373 % Additional per BOE data: Sales price $ 45.36 $ 57.78 $ (12.42 ) (21 %) Lease operating expenses $ 38.13 $ 38.10 $ 0.03 0 % Operating Margin per BOE 7.23 19.68 $ (12.45 ) (63 %) Impairment of oil & gas properties $ 335,894 $ 93,444 $ 242,450 259 % General and administrative: Management fees $ 94,550 $ 54,359 $ 40,190 74 % Accounting & legal $ 182,004 $ 95,168 $ 86,836 91 % Office, facilities, investor relations $ 35,608 $ 41,166 $ (5,558 ) (14 %) Total $ 312,162 $ 190,693 $ 121,469 64 % Change in fair value of warrant liability $ 1,909,455 $ - $ 1,909,455 - sales activity for the Company’s share of well operations:RevenuesOil and gas sales wererevenues increased 271% from $13,770 in fiscal 2008 to $51,134 in 2009 due to a full year of production in 2009 compared to $0approximately 2.75 months of production in fiscal 20072008 as our wells came on-line. Average daily production on an equivalent basis for 2009 was 3.1 BOE and was 2.9 BOE for 2008 representing an increase of 7%. Oil represented 72% of our production mix in 2009 compared to 48% in 2008 primarily due to our largest oil producing well, Pearce #1, beginning production in mid-December 2008. Gas production on an equivalent annual basis in 2009 was lower than anticipated due to a tubing puncture in the acquisitionOnnie Ray well in Q1 of minority working interest2009. The puncture is scheduled for repair in the first quarter 2010. propertiespricing.September and October 2008.Costs and ExpensesOil and gas production expense were $9,080 in fiscal year 2008revenues compared to $0746.6 Mcf and $5,571 in fiscal year 2007 asrevenues during the company entered into the oil & gas industrysame period in September 2008.General and administrative expenses (“G&A”) were $190,693 in fiscal year 2008 and $27,610 in fiscal year 2007 for an increase of $163,083. The change is primarily comprised ofrepresenting a $57,325158% increase in legalproduction and filing fees primarily due to the private placementa 63% increase in July 2008; anrevenue. This increase of $19,360 in stock option compensation expense as the Company issued its first stock option in several years, $14,520 of this total related to options granted to directors; an increase of $33,000 in fees paid to directors from $1,500 in fiscal year 2007 to $35,500 in fiscal year 2008is due to a changefull year of production in director fee policy; an increase2009 compare to 2.75 months of $16,143production in contract accounting expense2008 as our wells came on-line. Average gas prices realized for 2009 were $5.55 per Mcf compared to $7.46 per Mcf in 2008 representing a 25% decrease due to closing the Canadian officelower gas pricing. an increase of $16,381 in audit fees.ImpairmentGas Properties$93,444due to a decline in fiscaloil and natural gas prices in the first half of the year, lower than expected production volumes obtained from our oil and gas wells, the shut-in of an unproven property, and the adoption of new accounting standards utilizing a 12-month average beginning-of-the-month price instead of a period-end price.$0an increase of $24,755 in fiscalstock-based compensation expense. This increase is due to increasing fees paid to directors in September 2008 from $200 per quarter to approximately $2,000 per month and to recognizing a full year 2007.of stock compensation expense in 2009 for the stock granted in September 2008. impairment$86,836 increase is comprised of an increase in auditor and tax preparation fees for $32,936, and an increase in outsourced accounting fees of $42,625 and an increase in legal fees of $11,275 due to an increase in registration statements filed with the SEC.management’s reviewadjusting the warrant liability to fair value, we recorded a non-cash gain of capitalized costs compared$309,215 and a non-cash gain of $565,891 (net gain of $1,909,455) relating to estimated fair market value.Asthe Company had a cash balance of $2,734,591. The Company hasrespectively. We have financed itsour operations primarily from cash on hand and proceeds fromduring the July 28, 2008 private placement.2008,2008.net cash providedused in investing activities of $46,128($442,028) for 2007 duethe year ended December 31, 2008. The cash used in 2009 represents additions to more activity in the business as they changed from an application service provider to ancapitalized costs of oil and gas company.On July 28,properties and the cash used in 2008 represent acquisitions of oil and gas properties.Company completedyear ended December 31, 2009, compared to cash generated from financing activities of $3,200,000 for the year ended December 31, 2008.$3,200,000 self-directed private placement. The Private Placement consistedgoing concern. We have incurred cumulative losses of the sale$4,438,001 through December 31, 2009. Additionally, we have expended a significant amount of 6,450,000 units atcash to acquire working interests in oil and gas properties and operating as a price of $0.50 per Unit or $3,225,000public entity. We expect to continue to incur losses from business operations in the aggregate. The Units were offeredfuture. Management believes that our cash and soldcash equivalent balances, anticipated cash flows from operations and other external sources of credit will be sufficient to a total of 6 investors, all of whom were accredited investors. Each unit consisted of one share of the Company’s common stock, one Series A Warrantmeet our cash requirements through December 2011 if not longer. Our prospects after December 2011 will depend in large part on our ability to purchase a share of common stock at $0.60 per sharesuccessfully raise capital from external sources to pay for a period of 18 months from the date of issuanceplanned expenditures and one Series B Warrant to purchase a share of common stock at $0.75 per share for a period of 24 months from the date of issuance. In addition, 50,000 units were issued in payment of legal fees in the amount of $25,000.the Company's businesses, the Company expectsour business, we expect to incur losses as itwe expands. The Company expectsWe expect to raise additional funds through private or public equity investment in order to expand the range and scope of itsour business operations. The CompanyWe will seek access to private or public equity but there is no assurance that such additional funds will be available for the Companyus to finance itsour operations on acceptable terms, if at all.yearyears ended December 31, 2009 and December 31, 2008, the Companywe incurred $30,000 and $10,000, respectively, in fees paid to the Derek Cooper theour President, Chief Executive Officer and Chief Financial Officer of the Company.Officer. In addition, during September 2008, the Company granted stock options to purchase 50,000 shares of common stock to Mr. Cooper. For the year ended December 31, 2008, the Companyrelated(refer to this stock grant.Director Fees: For“Note 6. Stock Options” in the year ended December 31, 2008, the Company incurred $25,000 in board fees for non-employee directors of the Company. During 2008, the Company granted a total of 150,000 optionsNotes to purchase common stock to non-employee board members. For the year ended December 31, 2008, the Company recorded $14,520 as stock compensation expense relating to these stock option grants. During the year ended December 31, 2007, the Company paid management fees of $1,500 to the directors. There is no management or consulting agreements in effect.Accounts payable – related party:As of September 1, 2008, the Company settled all amounts owed to a former director and majority shareholder, amounting to $24,811, outstanding for management fees (the balance was forgiven for no consideration). The amount outstanding was recorded as an increase to additional paid-in capital. As of December 31, 2008 and 2007 accounts payable to related parties were $12,077 and $23,812 respectively.Rent:Until August 31, 2008, the Company’s administrative office was located at 1628 West 1stAvenue, Suite 216, Vancouver, British Columbia, Canada, V6J 1G1. This premise is owned by a private corporation controlled by a former director and majority shareholder. The Company paid rent of $6,663 and $7,812Financial Statements) for the years ended December 31, 20082009 and 2007, respectively. Effective September 1, 2008, the Company closed its administrative office in Vancouver, British Columbia, Canada, terminating all of its employees. There were no severance arrangements with any of the terminated employees.On December 31, 2007, 40,000,000 common shares owned by Mr. Harmel S. Rayat, a director2008, respectively.major shareholder of the Company, originally subscribedDecember 31, 2008, we incurred $50,435 and $25,000, respectively, in board fees for at $0.0033 each were returnednon-employee directors. In addition, we recorded $29, 640 and $14,520 as stock compensation expense (refer to the Company for cancellation and for no consideration. Mr. Harmel S. Rayat was an officer and director of the Company until September 12, 2008 and a majority stockholder of the Company until September 9, 2008.All related party transactions are recorded at the exchange amount established and agreed to between related parties and are“Note 6. Stock Options” in the normal course of business.The Company hasNote 2 for"Note 2. Accounting Policies" in the ConsolidatedNotes to Financial Statements in this Form 10-K/A.
10-K.INDEX TO FINANCIAL STATEMENTSPAGE Report of Independent Registered Public Accounting Firm 25 Balance Sheets as of December 31, 2009 and 2008 26 Statements of Operations for the years ended December 31, 2009 and 2008 27 Statements of Stockholders’ Equity for the years ended December 31, 2009 and 2008 28 Statements of Cash Flows for the years ended December 31, 2009 and 2008 29 Notes to Financial Statements 30 Report of Independent Registered Public Accounting FirmConsolidated Balance Sheets as of December 31, 2008 and 2007Consolidated Statements of Operations for the years ended December 31, 2008 and 2007Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2008 and 2007Consolidated Statements of Cash Flows for the years ended December 31, 2008 and 2007Notes to Consolidated Financial Statements
To the Board of DirectorsEntheos Technologies, Inc.Calgary, Alberta consolidated balance sheets of Entheos Technologies, Inc. ("the Company") as of December 31, 20082009 and 2007,2008, and the related consolidated statements of operations, stockholders' equity, and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. consolidated financial statements referred to above present fairly, in all material respects, the financial position of Entheos Technologies, Inc. as of December 31, 20082009 and 2007,2008, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States./S/ PETERSON SULLIVAN LLPApril 10, 2009Seattle, Washington
(The accompanying notes are an integral part of these consolidated financial statements) 2009 2008 ASSETS Current assets Cash and cash equivalents $ 2,409,770 $ 2,734,591 Accounts receivable 8,759 4,252 Prepaid expenses - 720 Total current assets 2,418,529 2,739,563 Oil and gas properties at costs (Note 4) Proven properties 424,191 368,282 Unproven properties 101,682 73,746 Accumulated depreciation, depletion and amortization and impairment (429,338 ) (93,444 ) Oil and gas properties, net 96,535 348,584 Total assets $ 2,515,064 $ 3,088,147 LIABILITIES Current liabilities Accounts payable and accrued liabilities $ 30,468 $ 50,854 Accounts payable - related parties 5,172 12,077 Asset retirement obligation 10,000 - Warrant liability (Note 5) 1,368,420 - Total current liabilities 1,414,060 62,931 Long-term liabilities Asset retirement obligation 40,000 - Total liabilities 1,454,060 62,931 STOCKHOLDERS' EQUITY (Note 5) Preferred stock: $0.0001 par value: Authorized: 10,000,000 shares Issued and outstanding: nil - - Common stock: $0.00001 par value; Authorized: 200,000,000 shares Issued and outstanding: 63,075,122 shares (2008: 63,075,122) 631 631 Additional paid-in capital 5,498,374 7,107,622 Accumulated deficit (4,438,001 ) (4,083,037 ) Total stockholders' equity 1,061,004 3,025,216 Total liabilities and stockholders' equity $ 2,515,064 $ 3,088,147
| 2009 | 2008 | |||||||
| Revenue | ||||||||
| Oil and gas sales | $ | 51,134 | $ | 13,770 | ||||
| Expenses | ||||||||
| Lease operating expenses | 42,984 | 9,080 | ||||||
| General and administrative expenses | 312,162 | 190,693 | ||||||
| Impairment of oil and gas properties | 335,894 | 93,444 | ||||||
| Total operating expenses | 691,040 | 293,217 | ||||||
| Operating Loss | (639,906 | ) | (279,447 | ) | ||||
| Other income / (expense) | ||||||||
| Interest income | - | 14,298 | ||||||
| Change in fair value of warrant liability | 1,909,455 | - | ||||||
| 1,909,455 | 14,298 | |||||||
| Net income (loss) attributable to common stockholders | $ | 1,269,549 | $ | (265,149 | ) | |||
| Income (loss) per common share - basic and diluted | $ | 0.02 | $ | (0.00 | ) | |||
| Weighted average number of shares - basic and diluted | 63,075,122 | 59,374,302 | ||||||
| Total | ||||||||||||||||||||
| Common Stock | Additional | Accumulated | Stockholders' | |||||||||||||||||
| Shares | Amount | paid-in capital | earnings (deficit) | Equity | ||||||||||||||||
| Balance, December 31, 2007 | 56,625,122 | $ | 566 | $ | 3,838,516 | $ | (3,817,888 | ) | $ | 21,194 | ||||||||||
Units issued for cash and legal services at $0.50 per share in July 2008 | 6,450,000 | 65 | 3,224,935 | - | 3,225,000 | |||||||||||||||
| Stock-based compensation expense | - | - | 19,360 | - | 19,360 | |||||||||||||||
| Settlement of related party payables | - | - | 24,811 | - | 24,811 | |||||||||||||||
| Net loss, year ended December 31, 2008 | - | - | - | (265,149 | ) | (265,149 | ) | |||||||||||||
| Balance, December 31, 2008 | 63,075,122 | 631 | 7,107,622 | (4,083,037 | ) | 3,025,216 | ||||||||||||||
| Cumulative effect of change in accounting principle | - | - | (1,653,362 | ) | (1,624,513 | ) | (3,277,875 | ) | ||||||||||||
| Stock-based compensation expense | - | - | 44,114 | - | 44,114 | |||||||||||||||
| Net income, year ended December 31, 2009 | - | - | - | 1,269,549 | 1,269,549 | |||||||||||||||
| Balance, December 31, 2009 | 63,075,122 | $ | 631 | $ | 5,498,374 | $ | (4,438,001 | ) | $ | 1,061,004 | ||||||||||
| 2009 | 2008 | |||||||
| Cash flows from operating activities | ||||||||
| Net income (loss) | $ | 1,269,549 | $ | (265,149 | ) | |||
| Adjustments to reconcile net income (loss) to net cash flows from operating activities: | ||||||||
| Impairment of oil and gas properties | 335,894 | 93,444 | ||||||
| Stock-based compensation | 44,114 | 19,360 | ||||||
| Stock issued for services | - | 25,000 | ||||||
| Change in fair value of warrant liability | (1,909,455 | ) | - | |||||
| Changes in operating assets and liabilities: | ||||||||
| (Increase) in accounts receivable | (4,507 | ) | (4,252 | ) | ||||
| (Increase) decrease in prepaid assets | 720 | (720 | ) | |||||
Increase (decrease) in accounts payable & accrued liabilities including related party payables | (27,291 | ) | 62,630 | |||||
| Net cash flows from operating activities | (290,976 | ) | (69,687 | ) | ||||
| Cash flows from investing activities | ||||||||
| Acquisition of oil and gas properties | (33,845 | ) | (442,028 | ) | ||||
| Net cash flows from investing activities | (33,845 | ) | (442,028 | ) | ||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of common stock, net | - | 3,200,000 | ||||||
| Net cash flows from financing activities | - | 3,200,000 | ||||||
| Increase (Decrease) in cash and cash equivalents | (324,821 | ) | 2,688,285 | |||||
| Cash and cash equivalents, beginning of period | 2,734,591 | 46,306 | ||||||
| Cash and cash equivalents, end of period | $ | 2,409,770 | $ | 2,734,591 | ||||
| Non-cash investing and financing activities: | ||||||||
| Asset retirement obligation | $ | 50,000 | $ | - | ||||
| Settlement of related party payables | $ | $ | 24,811 | |||||
| Supplemental disclosure of cash flow information: | ||||||||
| Interest paid in cash | $ | - | $ | - | ||||
| Income tax paid in cash | $ | - | $ | - | ||||
(Expressed in U.S. Dollars)
Email Solutions, Inc. was dissolved during 2008. US GAAP. flows attributable to the reserves that are utilized for impairment analysis could have a significant impact on the future results of operations. oil and gas properties. its oil and gas properties. The 2009. significant judgment, they cannot be determined with precision. Changes in assumptions can significantly affect estimated fair values. The carrying value of cash and cash equivalents, accounts payable and accrued liabilities, and accounts payable – related parties approximates their fair value because of the short-term nature of these instruments. statements over the requisite service period for awards expected to vest. The Company uses the Black-Scholes pricing model to determine the fair value of stock-based compensation awards on the date of grant. The Black-Scholes pricing model requires management to make assumptions regarding the option lives, expected volatility, and risk free interest rates. See “Note 6. Stock Options” for additional information on the Company’s stock-based compensation plans. For the years ended December 31, 2008 2007 Numerator - net loss attributable to common stockholders $ (265,149) $ (24,682) Denominator - weighted average number of common shares outstanding 59,374,302 96,515,533 Basic and diluted loss per common share $ 0.00 $ 0.00 Month Acquisition Interest Production Date Working Net Revenue Started Formation Proven Properties: Cooke #6 9/1/2008 21.75% 16.3125% Dec-07 Escondido Onnie Ray #1 9/12/2008 20.00% 15.00% Oct-08 Austin Chalk Stahl #1 9/12/2008 20.00% 15.00% Oct-08 Austin Chalk Pearce #1 10/31/2008 20.00% 15.00% Dec-08 Austin Chalk Unproven Properties: Haile #1 9/12/2008 20.00% 15.00% - Austin Chalk 2008 2007 Acquisition costs $ 234,599 $ - Exploration costs 82,875 - Development costs 124,554 - $ 442,028 $ - extent of anticipated salvage value of the equipment. which became effective January 1, 2009 Weighted Remaining average contractual Aggregate Number of exercise term intrinsic options price (years) value Outstanding at December 31, 2006 7,230,000 $ 0.01 Cancelled (7,230,000) 0.01 Outstanding at December 31, 2007 0 Granted 200,000 1.00 9.70 $ - Outstanding at December 31, 2008 200,000 1.00 9.70 - Exercisable at December 31, 2008 0 Number of options Weighted Average Grant Date Fair Value Unvested, December 31, 2006 7,230,000 $ 0.51 Granted - - Cancelled (7,230,000) 0.51 Unvested, December 31, 2007 - - Granted 200,000 0.73 Vested - - Unvested, December 31, 2008 200,000 0.73 respectively. tax purposes are recognized, as appropriate. Realization of the future tax benefits related to the deferred tax assets is dependent on many factors, including the Company’s ability to generate taxable income within the net operating loss carryforward period. Management has considered these factors in reaching its conclusion as to the valuation allowance for financial reporting purposes and has recorded a full valuation allowance against the deferred tax asset. The income tax effect, utilizing a 34% income tax rate, of temporary differences comprising the 2008 2007 Deferred tax assets: Net operating loss carryforwards $1,275,000 $1,226,000 Stock based compensation 7,000 - Valuation allowance (1,271,000) (1,226,000) Deferred tax liability 11,000 - Oil and gas properties (11,000) Net deferred tax assets $- $- 2008 2007 Statutory federal income tax rate -34% -34% Valuation allowance 34% 34% 0% 0% last five years: 2006. Mr. Sidhu served as a member of the board of directors for U.S. Petroleum Corporation from August 2003 until August 2006. Since September 2008, Mr. Sidhu has been a director of Entheos Technologies, Inc. Mr. Sidhu was invited to join the Board of Directors due to his experience with public companies in the matters relating to business development, financial reporting and legal compliance. Name Fees Earned or Paid in Cash ($) (1) Stock Awards ($) (2) Total ($) Jeet Sidhu $ 8,000 $ 4,840 (3) $ 12,840 Christian Hudson 8,000 4,840 (3) 12,840 Frank Fabio 6,000 4,839 10,839 Tim N. Luu 3,000 0 3,000 Name and Principal Position Year Salary Other Options Awards ($) Total Derek Cooper 2008 0 10,000(2) $ 4,840 President, CEO, 2007 n/a Chief Financial Officer 2006 n/a and Director Harmel S. Rayat (1) 2008 $ 0 $ 0 $ 0 0 President, CEO, 2007 $ 0 $ 0 $ 0 0 Chief Financial Officer 2006 $ 0 $ 0 $ 4,500 0 and Director Tim Luu (1) 2008 $ 0 $ 0 $ 0 0 Secretary, Treasurer 2007 $ 0 $ 0 $ 3,000 0 Chief Technology Officer 2006 $ 0 $ 0 $ 3,300 0 and Director STOCK HOLDER MATTERS. power to vote or to direct the voting of the security, or investment power, which includes the power to dispose of or to direct the disposition of the security. Except as indicated in the footnotes to this table, each beneficial owner named in the table below has sole voting and sole investment power with respect to all shares beneficially owned and each person's address is c/o our principal office Person or Group Number of Shares of Common Stock Percent Derek J. Cooper 0 (1)(2)(3) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Christian Hudson 0 (1)(2) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Jeet Sidhu 0 (1)(2) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Frank Fabio 0 (1)(4) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 1420525 Alberta Ltd. (5)(6) 32,639,800 (6) 52 % 1628 West 1st Avenue, Suite 216 Vancouver, BC V6J 1G1 Directors and Executive Officers 0 0.0 % as a group (4 persons) 10-K: 10-K: March, 2010. Entheos I, (“the Company”(the “Company”, “we”, “us”, and “our”) is a small independent diversified energy company engaged in the acquisition and development of crude oil and natural gas interestsproduction company with a focus on participation in producing oil and gas wells and the United States. The Company pursuesre-development/recompletion of oil and gas wells. We pursue oil and gas prospects in partnership with oil and gas companies with exploration, development and production expertise. The Company has aCurrently, our interests consist of non-operating, minority working interest in five properties.interests. The Company’s prospect areas consist of land in La Salle County, Lee County, Fayette County and Frio County, Texas. Currently four of the five wells in which we have athe Company has minority working interest are producing. WeThe Company currently dodoes not operate any of the wells in which we haveit has an interest.itsour wholly-owned subsidiary Email Solutions, Inc., the Companywe served as an Application Service Provider (“ASP”) providing reliable, real time, high volume outsourced email and search engine optimization services.. Due to the limited success of theour ASP business, management decided that it was in the best interest of our stockholders to abandon the Application Service Provider business and focus on identifying undervalued oil and gas opportunities for acquisition, development and exploration. The assets and liabilities, the results of operations and cash flows related to the ASP business were not classified as discontinued operations as the amounts were not significant.However, managementManagement believes that the Company’s cash and cash equivalent balances, anticipated cash flows from operations and other external sources of credit will be sufficient to meet its cash requirements through March 2010.December 2011 if not further. The future of the Company after March 2010December 2011 will depend in large part on its ability to successfully generate cash flows from operations and raise capital from external sources to fund operations.accounting principles generally accepted in the United States of America.The consolidated financial statements include the accounts of Entheos Technologies, Inc. (a Nevada corporation) and its wholly-owned subsidiary, Email Solutions, Inc. (a Nevada corporation). There are no assets and liabilities in the wholly owned subsidiary. consolidated financial statements.of future oil and gas reserves; estimates used in the impairment of oil and gas properties; and the estimated future timing and cost of asset retirement obligations.reports because of its recent acquisition of its oil and gas properties and because these properties recently began producing.reports. Management is assessing geographic and production data to determine the need forfeasibility of obtaining reserves studies. At December 31, 2008,2009, there were no capitalized costs subject to amortization.for 2008. Thisduring 2009 and 2008, respectively. The impairment is similar to amortizationamortizatio n and therefore is not added to the costcosts of properties being amortized.didhas not sellsold any properties during 2008 or 2007.and distribute and disburse funds to various working interest partners and royalty owners, the collection of revenues from oil and gas production may take up to 45 days following the month of production. Therefore, the Company maym ay make accruals for revenues and accounts receivable based on estimates of its share of production. Since the settlement process may take 30 to 60 days followin gfollowing the month of actual production, its financial results may include estimates of production and revenues for the related time period. The Company will record any differences between the actual amounts ultimately received and the original estimates in the period they become finalized. As of December 31, 2008, all revenue and expense information had been received from the operators so there was no estimated revenue or expense.has adopted the provisions of SFAS 143,“Accountingaccounts for Asset Retirement Obligations.” SFAS 143 amended SFAS 19,“Financial Accounting and Reporting by Oil and Gas Producing Companies,”and, among other matters, addresses financial accounting and reporting for legal obligations associated with the retirement of tangible long-lived assets and the associatedits future asset retirement costs. SFAS No. 143 requires thatobligations by recording the fair value of athe liability for an asset retirement obligation be recognized induring the period in which it is incurred, with thewas incurred. The associated asset retirement costcosts are capitalized as part of the related asset and allocated to expense overcarrying amount of the asset’s useful life.In March 2005,long-lived asset. The increase in carrying value of a property associated with the FASB issued FASB Interpretation No. 47 (“FIN No. 47”),Accounting for Conditional Asset Retirement Obligations. FIN No. 47 clarifies that a conditionalcapitalization of an asset retirement obligation as usedis included in SFAS 143, refers to a legal obligation to perform anproven oil and gas properties in the balance sheets. The Company’s asset retirement activity in whichobligation consists of costs related to the timing or methodplugging of the settlement are conditionalwells, removal of facilities and equipment and site restoration on a future event that may or may not be within the control of the entity. Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirementobligation if the fair value can be reasonably estimated. Company does not have material asset retirement liability is allocated to operating expense using a systematic and rational method.as of December 31, 2008 or 2007.Cash and Cash EquivalentsThe Company considers all highly liquid instruments purchased with an original maturity of three months or lessamounted to be cash equivalents. The Company did not have any cash equivalents$50,000 at December 31, 2008 and 2007. The Company occasionally has cash deposits in excess of insured limits.Income TaxesThe Company adopted SFAS 109,“Accounting for Income Taxes.”Under SFAS 109, deferred income tax assets and liabilities are computed for differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary, to reduce deferred income tax assets to the amount expected to be realized.In June 2006, the FASB issued Interpretation No. 48 (“FIN 48”), “Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109, Accounting for Income Taxes”, effective for the Company beginning on January 1, 2007. FIN 48 clarifies the recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on disclosure and other matters. The adoption of FIN 48 had no impact on the Company’s financial position.Stock-Based CompensationThe Company accounts for stock-based compensation under SFAS 123(R) “Share-Based Payment”which requires measurement of compensation cost for all stock-based awards at fair value on the date of grant and recognition of compensation over the service period for awards expected to vest. The fair value of stock options is determined using the Black-Scholes valuation model.Loss Per ShareBasic earnings or loss per share is based on the weighted average number of common shares outstanding. Diluted earnings or loss per share is based on the weighted average number of common shares outstanding and dilutive common stock equivalents. Basic earnings/loss per share is computed by dividing net income applicable to common stockholders (numerator) by the weighted average number of common shares outstanding (denominator) for the period. All earnings or loss per share amounts in the financial statements are basic earnings or loss per share, as defined by SFAS 128,“Earnings Per Share.”Convertible securities that could potentially dilute basic earnings or loss per share in the future, such as options and warrants, are not included in the comput ation of diluted earnings or loss per share because to do so would be antidilutive.Comprehensive Income (Loss)The Company has adopted SFAS 130,“Reporting Comprehensive Income,” which establishes standards for reporting and display of comprehensive income, its components and accumulated balances. For 2008 and 2007 the Company did not have any items of comprehensive income, other than net loss.Foreign Currency TranslationThe Company translates foreign assets and liabilities of its subsidiaries, other than those denominated in United States Dollars, at the rate of exchange at the balance sheet date. Revenues and expenses are translated at the average rate of exchange throughout the year. Gains or losses from these translations are reported as a separate component of other comprehensive income (loss), until all of the investment in the subsidiaries is sold or liquidated. The translation adjustments do not recognize the effect of income tax because the Company expects to reinvest the amounts indefinitely in operations.Transaction gains (losses) that arise from exchange rate fluctuations on transactions denominated in a currency other than the local functional currency are included in the statements of operations.placesconsiders all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. The Company did not have any cash equivalents at December 31, 2009 and 2008. The Company occasionally has cash deposits in excess of federally insured limits. The Company has not experienced any losses related to these balances, and management believes its cashcredit risk to be minimal.high credit qualitychanges in value recognized as other income (expense) in the statements of operations in the period of change.institutions.thatwho holds 10% or more of the Company’s securities and their immediate families, (ii) the Company’s management, (iii) someone thatwho directly or indirectly controls, is controlled by or is under common control with the Company, or (iv) anyone who can significantly influence the financial and operating decisions of the Company. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties. (See Note 5)“Note 7. Related Party Transactions”).September 2006,June 2009, the FASB issued SFAS 157, “Fair Value Measurements” (SFAS 157), which defines fair value, establishesnew authoritative guidance to eliminate the quantitative approach previously required for determining the primary beneficiary of a framework for measuring fair value,variable interest entity and expands disclosures about fair-value measurements required under other accounting pronouncements. It does not change existingrequires ongoing qualitative reassessments of whether an enterprise is the primary beneficiary of a variable interest entity. We adopted the guidance as to whether or not an instrument is carried at fair value. SFAS 157 was effective forin 2009 without material impact on our consolidated financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. statements.February 2008,April 2009, the FASB issued FASB Staff Position No. FAS 157-1 (FSP FAS 157-1), which excludes SFAS 13, “Accounting for Leases” and certain other accounting pronouncements that addressadditional authoritative guidance on the fair value measurements under SFAS 13, from the scope of SFAS 157. In February 2008, the FASB issued FASB Staff Position No. 157-2 (FSP 157-2),financial instruments, which provides a one-year delayed application of SFAS 157 for nonfinancial assets and liabilities, except for items that are recognized or disclosed at fair value in the financial statementsprovides: (i) further provisions on a recurring basis (at least annually). Therefore, the Company adopted the provisions of SFAS 157 with respect to financial assets and liabilities only. The Company is required to adopt SFAS 157 as amended by FSP FAS 157-1 and FSP FAS 157-2 on January 1, 2009, the beginning of its fiscal year as related to nonfinancial assets and liabilities. The Company does not expect the application of the amended aspects of SFAS No. 157 to have a material effect on the Company’s consolidated financial statements.In October 2008, the FASB issued FASB Staff Position No. FAS 157-3, “Determining the Fair Value of a Financial Asset in a Market That Is Not Active” (FSP 157-3), which clarifies the application of SFAS 157 when the market for a financial asset is inactive. Specifically, FSP 157-3 clarifies how (1) management’s internal assumptions should be considered in measuringestimating fair value when observable data are not present, (2) observable market information from anthe markets become inactive market should be taken into account, and (3) the use of broker quotes or pricing services should be considered in assessing the relevance of observable and unobservable data to measure fair value. The guidance in FSP 157-3 is effective immediately and did not have an impact on the Company’s consolidatedquoted prices reflect distressed transactions; (ii) extended disclosure requirements for interim financial statements.In February 2007, the FASB issued SFAS 159, “The Fair Value Option for Financial Assets and Financial Liabilities-Including an amendment of FASB Statement No. 115,”which is effective for fiscal years beginning after November 15, 2007. The statement permits entities to choose to measure many financial instruments and certain other items at fair value. The Company has not electedstatements regarding the fair value option under SFAS 159of financial instruments; and (iii) new criteria for any instrument, but may electrecording impairment charges on investments in debt instruments. We adopted the guidance on a prospective basis in 2009 without material impact to do so in future periods.In July 2007, the Emerging Issues Task Force (EITF) issued EITF 07-3, “Accounting for Nonrefundable Advance Payments for Goods or Services to be Used in Future Research and Development Activities” (EITF 07-3). EITF 07-3 clarifies the accounting for nonrefundable advance payments for goods or services that will be used or rendered for research and development activities. EITF 07-3 states that such payments should be capitalized and recognized as an expense as the goods are delivered or the related services are performed. If an entity does not expect the goods to be delivered or the services rendered, the capitalized advance payment should be charged to expense. EITF 07-3 is effective for fiscal years beginning after December 15, 2007. The Company 6;s adoption of EITF 07-3 did not have an impact on the Company’sour financial position or results of operations.In December 2007, the FASB issued SFAS 160, “Noncontrolling Interests in Consolidated Financial Statements, an Amendment of Accounting Research Bulletin No 51” (SFAS 160). SFAS 160 establishes accounting and reporting standards for ownership interests in subsidiaries held by parties other than the parent, changes in a parent’s ownership of a noncontrolling interest, calculation and disclosure of the consolidated net income attributable to the parent and the noncontrolling interest, changes in a parent’s ownership interest while the parent retains its controlling financial interest and fair value measurement of any retained noncontrolling equity investment. SFAS 160 is effective for financial statements issued for fiscal years beginning aft er December 15, 2008, and interim periods within those fiscal years. Early adoption is prohibited. The Company must adopt SFAS 160 on January 1, 2009, the beginning of its fiscal year. The Company does not expect the application of SFAS No. 160 to have a material effect on the consolidated financial statements.In December 2007, the FASB issued SFAS 141R, “Business Combinations” (SFAS 141R), which establishes principles and requirements for the reporting entity in a business combination, including recognition and measurement in the financial statements of the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree. SFAS 141R applies prospectively tobusiness combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, and interim periods within those fiscal years. The Company must adopt SFAS 141R on January 1, 2009, the beginning of its fiscal year. The Company does not expect the application of SFAS 141R to have a material effect on the consolidated financial statements.In December 2007, the SEC staff issued Staff Accounting Bulletin (SAB) 110, “Share-Based Payment” (SAB 110) which amends SAB 107, “Share-Based Payment,” to permit public companies, under certain circumstances, to use the simplified method in SAB 107 for employee option grants after December 31, 2007. Use of the simplified method after December 2007 is permitted only for companies whose historical data about their employees’ exercise behavior does not provide a reasonable basis for estimating the expected term of the options. The Company currently uses the simplified method to e stimate the expected term for employee option grants as adequate historical experience is not available to provide a reasonable estimate. SAB 110 is effective for employee options granted after December 31, 2007. The Company adopted SAB 110 effective January 1, 2008 and continues applying the simplified method until enough historical experience is readily available to provide a reasonable estimate of the expected term for employee option grants.issued Staff Position EITF 03-06-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities” (FSP EITF 03-06-1). FSP EITF 03-06-1ratified new authoritative guidance addressing the accounting for certain instruments (or embedded features) determined to be indexed to an entity’s own stock. This guidance provides that unvested share-based payment awardsan entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. We adopted this guidance effective January 1, 2009 on a prospective basis. See “Note 5. Stockholders’ Equity” for further discussion of the impact of this guidance to our financial statements.contain nonforfeitable rightsoccur after the balance sheet date but before financial statements are issued or are available to dividendsbe issued. The guidance was effective for interim or dividendannual financial periods ending after June 15, 2009. This guidance applies to both interim financial statements and annual financial statements. In February 2010, the FASB issued additional guidance that clarifies certain existing evaluation and disclosure requirements related to subsequent events. We adopted the initial and revised guidance without material impact on our financial statements.(whether paid or unpaid)include 13,050,000 and 13,100,000 warrants and stock options that are participating securities and shall benot included in the computation of earnings per share pursuant to the two-class method in SFAS No. 128, “Earnings per Share” and is effective for fiscal years beginning after December 15, 2008. The Company does not believe the implementation of FSP EITF 03-06-1 will have any impact on the Company’s consolidated financial statements.Note 3. Loss Per ShareBasic earnings or loss per common share is based on the weighted average number of shares outstanding during the period of the financial statements. Diluted earnings ordiluted loss per share are based on the weighted average number of common shares outstandingbecause to do so would be anti-dilutive for 2009 and dilutive common stock equivalents.2008, respectively. All share and per share information are adjusted retroactively to reflect stock splits and changes in par value, when applicable. Allamounts infor the financial statements are basic loss per share because the inclusion of stock optionsyears ended December 31, 2009 and warrants outstanding would be antidilutive.2008: 2009 2008 Numerator - net income (loss) $ 1,269,549 $ (265,149 ) Denominator - weighted average number of common shares outstanding 63,075,122 59,374,302 Basic and diluted income (loss) per common share $ 0.02 $ (0.00 ) During the fiscal year ended2008,2009, the Company acquiredowned non-operating, working interests in five wells in one geographic area as follows: Month Acquisition Interest Production Date Working Net Revenue Started Acreage Formation Proven Properties: Cooke #6 9/1/2008 21.75 % 16.3125 % Dec-07 40 Escondido Onnie Ray #1 9/12/2008 20.00 % 15.00 % Oct-08 80 Austin Chalk Stahl #1 9/12/2008 20.00 % 15.00 % Oct-08 20 Austin Chalk Pearce #1 10/31/2008 20.00 % 15.00 % Dec-08 360 Austin Chalk Unproven Properties: Haile #1 9/12/2008 20.00 % 15.00 % - 100 Austin Chalk Capitalized Costs Relating to Oil and Gas Producing Activities 2009 2008 Proven properties $ 424,191 $ 368,282 Unproven properties 101,682 73,746 525,873 442,028 Impairment of properties (429,338 ) (93,444 ) Oil and gas properties, net $ 96,535 $ 348,584 including capital expenditures are summarized as follows at December 31, 2008 and 2007:2009: Cost Incurred for Oil & Gas Properties as of December 31, 2009 Proven Unproven Total Acquisition costs $ 218,528 $ 16,071 $ 234,599 Exploration costs 25,260 85,611 110,871 Development costs 180,403 - 180,403 424,191 101,682 525,873 Impairment of oil properties (348,241 ) (81,097 ) (429,338 ) Oil and gas properties, net $ 75,950 $ 20,585 $ 96,535 yet obtained reserve studies with estimated proved reserve quantities because of its recent acquisition of these properties and also because these properties recently began producing.reserves. Management is assessing geographic and production data to determine the need forfeasibility of obtaining reserves studies. Therefore at December 31, 2009, and 2008 there were no capitalized costs subject to amortization.an exploratorya development oil well which hadwas completed in August 2009 and did not been completed and is not producing. These exploratoryproduce. Management has impaired the well costs have also been excluded from amortization. Management expects that the recompletion efforts will be finished during 2009 at which time the capitalized costs will be added to the amortization base.2008. Thisthe years ended December 31, 2009 and 2008, respectively. The impairment recognized during 2009 was due to a decline in oil and natural gas prices in the first half of the year; lower than expected production volumes obtained from our oil and gas wells; and utilizing a 12-month average beginning-of-the-month price instead of a period-end price. The impairment is similar to amortization and therefore is not added to the cost of properties being amortized. Years Ended December 31, 2009 2008 Asset retirement obligations, beginning of year $ - $ - Change in estimated obligations 50,000 - Asset retirement obligations, end of year 50,000 - Less: current retirement obligations (10,000 ) - Long-term retirement obligations $ 40,000 $ 0 Related Party TransactionsStockholders’ EquityExecutive Management: .For Upon the adoption of this guidance, the Company recognized a one-time decrease to opening accumulated deficit of $1,624,513.Black-Scholes model assumptions as of December 31, 2009 Series A Warrants Series B Warrants Risk-free interest rate 0.20% 0.47% Expected term (in years) 0.58 1.08 Expected volatility 26.24% 85.58% Dividend per share $0 $0 Expiration date July 28, 2010 January 28, 2011 Series A Warrants Series B Warrants Total Beginning balance as of January 1, 2009 $ 1,652,779 $ 1,625,096 $ 3,277,875 Change in fair value 1,343,564 565,891 1,909,455 Ending balance as of December 31, 2009 $ 309,215 $ 1,059,205 $ 1,368,420 2008,2009.incurred $10,000 in fees paidhas an active stock option plan that provides shares available for option grants to employees, directors and others. A total of 120,000,000 shares of the Company’s common stock have been reserved for award under the stock option plan, of which 119,850,000 were available for future issuance as of December 31, 2009. Options granted under the Company’s option plan generally vest over five years or as otherwise determined by the Board of Directors, have exercise prices equal to the Derek Cooper the President, Chief Executive Officer and Chief Financial Officerfair market value of the Company. In addition, during September 2008, the Company granted stock options to purchase 50,000 shares of common stock to Mr. Cooper. Foron the date of grant, and expire no later than ten years after the date of grant. Weighted Remaining average contractual Aggregate Number of exercise term intrinsic options price (years) value Outstanding at December 31, 2007 - $ - Granted 200,000 1.00 Cancelled - Outstanding at December 31, 2008 200,000 1.00 Granted - Cancelled (50,000 ) 1.00 Outstanding at December 31, 2009 150,000 1.00 8.70 $ - Exercisable at December 31, 2009 30,000 1.00 8.70 $ - Available for grant at December 31, 2009 119,850,000 Number of options Weighted Average Grant Date Fair Value Unvested, December 31, 2007 - $ - Granted 200,000 0.73 Cancelled - - Unvested, December 31, 2008 200,000 0.73 Granted - - Cancelled (50,000 ) 0.73 Vested (30,000 ) 0.73 Unvested, December 31, 2009 120,000 0.73 recorded $4,840 asgranted nil and 200,000 stock options awards, respectively. For purposes of determining the stock-based compensation expense related to thisfor stock grant.Director Fees: Foroption awards granted, the Black-Scholes Option Pricing Model was used with the following assumptions: dividend yield of 0%, expected volatility of 195.38%, risk-free interest rate of 2.97%, and expected term of 5 years. The weighted average fair value of options granted during the year ended December 31, 2009 and 2008 was $0 and $0.73, respectively, per share.incurred $25,000 in board fees for non-employee directorshad $51,068 of the Company. During 2008, the Company grantedtotal unrecognized compensation cost related to unvested stock options, which is expected to be recognized over a totalweighted average period of 150,000approximately 3.70 years.to purchase common stock to non-employee board members. Forthat vested during the year ended December 31, 2008,2009 was $21,900.recorded $14,520 as stock compensation expense relating to these stock grants. During the year ended December 31, 2007, the Company paid management fees of $1,500 to the directors. There is no management or consulting agreements in effect.Accounts payable – related party:As of September 1, 2008, the Company settled all amounts owed to a former director and majority shareholder, amounting to $24,811, outstanding for management fees (the balance was forgiven for no consideration). The amount outstanding was recorded as an increase to additional paid-in capital. As of December 31, 2008 and 2007 accounts payable to related parties were $12,077 and $23,812 respectively.Rent:Until August 31, 2008, the Company’s administrative office was located at 1628 West 1stAvenue, Suite 216, Vancouver, British Columbia, Canada, V6J 1G1. This premise is owned by a private corporation controlled by a former director and majority shareholder. The Company paid rent of $6,663 and $7,812 for the years ended December 31, 2008 and 2007, respectively. Effective September 1, 2008, the Company closed its administrative office in Vancouver, British Columbia, Canada, terminating all of its employees. There were no severance arrangements with any of the terminated employees.On December 31, 2007, 40,000,000 commonissues new shares owned by Mr. Harmel S. Rayat, a director and major shareholder of the Company, originally subscribed for at $0.0033 each were returned to the Company for cancellation and for no consideration. Mr. Harmel S. Rayat was an officer and director of the Company until September 12, 2008 and a majority stockholder of the Company until September 9, 2008.All related party transactionswhen options are recorded at the exchange amount established and agreed to between related parties and are in the normal course of business.6. Stockholders’ Equity7. Related Party TransactionsOn December 31, 2007, 40,000,000 common shares owned by Mr. Harmel S. Rayat, a director and major shareholder of the Company,originally subscribed for at $0.0033 each were returned to the Company for cancellation and for no consideration.On July 28, 2008, the Company completed a self-directed private placement of 6,450,000 units at a price of $0.50 per unit or $3,225,000 in the aggregate. Each unit consists of one share of the Company’s common stock, one Series A stock purchase warrant (Series A warrant) to purchase a share of common stock at $0.60 per share for a period of 18 months from the date of issuance and one Series B stock purchase warrant (Series B warrant) to purchase a share of common stock at $0.75 per share for a period of 24 months from the date of issuance. The relative fair value of the common stock was estimated to be $1,571,638 and the relative fair value of the warrants was estimated to be $1,653,362 as determined based on the relative fair value allocation of the proceeds received. The warrants were valued using the Black-Scholes option pricing model. In connection with the private placement, the Company issued an aggregate of 50,000 units in payment of legal fees in the amount of $25,000. These units were otherwise issued on the same terms and conditions as the units sold in the private placement.WarrantsThe Company account for warrants granted to unrelated parties in accordance with EITF 00-19 “Accounting for Derivative Financial Instruments Indexed to and Potentially Settled in a Company’s Own Stock.”In accordance with the EITF, the fair value of such warrants is classified as a component of permanent equity within additional paid-in capital and is calculated on the date of grant using the Black-Scholes Option pricing model.Each of the Company’s warrants outstanding entitles the holder to purchase one share of the Company’s common stock for each warrant share held. No warrants were exercised during For the years ended December 31, 20082009 and 2007. A summary of the Company’s warrants outstanding is as follows: Series A Series B Warrants Warrants Warrants outstanding and exercisable at December 31, 2008 6,450,000 6,450,000 Exercise price $0.60 $0.75 Fair value on date of grant $2,495,800 $2,593,247 Black-Scholes option pricing model assumptions: Risk-free interest rate 2.435% 2.590% Expected term 1.5 years 2 years Expected volatility 96.15% 100.76% Dividend per share $0 $0 Expiration date January 28, 2010 July 28, 2010 A total of 12,900,000 shares of the Company’s common stock have been reserved for issuance upon exercise of warrants shares outstanding as of December 31, 2008.Note 7. Stock OptionsThe Company has an active stock option plan that provides shares available for option grants to employees, directors and others. A total of 120,000,000 shares of the Company’s common stock have been reserved for award under the stock option plan, of which 119,800,000 were available for future issuance as of December 31, 2008. Options granted under the Company’s option plan generally vest over five years or as otherwise determined by the Board of Directors, have exercise prices equal to the fair market value of the common stock on the date of grant, and expire no later than ten years after the date of grant.Summary of employee stock option information for years ended December 31, 2008, the Company incurred $30,000 and 2007 is as follows:
Available for grant at December 31, 2008
119,800,000The aggregate intrinsic value$10,000, respectively, in fees paid to Derek Cooper the table above represents the total pretax intrinsic value for all “in-the-money” options (i.e. the difference between the Company���s closing stock price on the last trading dayPresident, Chief Executive Officer and Chief Financial Officer of the year ended December 31, 2008Company. In addition, the Company recorded $14,474 and the exercise price, multiplied by the number of shares) that would have been received by the option holders had all option holders exercised their options on December 31, 2008. This amount is based on the fair market value of the Company’s stock. Total intrinsic value of options exercised was $nil at December 31, 2008 (2007: $nil).A summary of the Company’s unvested$4,840 as stock options and changes duringcompensation expense (refer to “Note 6. Stock Options”) for the years ended December 31, 20082009 and 2007 is as follows:All stock options outstanding at December 31, 2008, were granted on the same date, have the same exercise price, term and grant date fair value.Duringrespectively.20082009 and 2007,December 31, 2008, the Company granted 200,000incurred $50,435 and nil$25,000, respectively, in board fees for non-employee directors of the Company. In addition, the Company recorded $29,640 and $14,520 as stock options awards. For purposes of determining the stock-based compensation expense (refer to “Note 6. Stock Options”) for stock option awards granted, theBlack-Scholes Option Pricing Model was used with the following assumptions: dividend yield of 0%, expected volatility of 195.38%, risk-free interest rate of 2.97%, and expected term of 5 years.The weighted average fair value of options granted during the yearyears ended December 31, 2008 was $0.73 per share.For the year ended2009 and December 31, 2008, stock option compensation expense of $19,360 was recognized as general and administrative expenses. There was no stock based compensation expense for the year ended December 31, 2007. The Company had $125,987 of total unrecognized compensation cost related to unvested stock options as of December, 31 2008, which is expected to be recognized over a weighted average period of approximately 4.7 years.The Company does not repurchase shares to fulfill the requirements of options that are exercised. Further, the Company issue new shares when options are exercised.20082009 and 2007,2008, due to the Company’s loss position. The benefits of temporary differences have not been recorded. The deferred tax consequences of temporary differences in reporting items for financial statement and incomedeferredd eferred tax assets and deferred tax liabilities is a result of the following at December 31: 2008 2007 Deferred tax assets: Net operating loss carryforwards $ 1,375,000 $ 1,275,000 Stock based compensation 19,000 7,000 Oil and gas properties 93,000 - 1,487,000 1,282,000 Deferred tax liability: Oil and gas properties - (11,000 ) 1,487,000 1,271,000 Valuation allowance (1,487,000 ) (1,271,000 ) Net deferred tax assets $ - $ - 2008 increase2009 increase in the valuation allowance was $45,000 (2007: $8,000)$216,000 (2008: $45,000).$3,771,000$4,044,000 for tax purposes to offset future taxable income which expires commencing 2011 through to the year 2028.2029. Pursuant to the Tax Reform Act of 1986, annual utilization of the Company’s net operating loss carryforwards may be limited if a cumulative change in ownership of more than 50% is deemed to occur within any three-year period. The tax years 20052006 through 20072009 remain open to examination by federal agencies and other jurisdictions in which it operates.Note 9. Subsequent EventsEffective January 9th2009, Frank Fabio resigned as Chief Financial Officer 2009 2008 Statutory federal income tax rate 34 % (34 %) Non-taxable gains (51 %) Valuation allowance 17 % 34 % 0 % 0 % ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. Secretary of the Company. This resignation was not the result of a disagreement with the Company on any matter relating to the Company's operations, policies or practices.Also effective January 9th2009, the Board of Directors of the Company appointed Mr. Derek Cooper, President and Chief Executive Officer of the Company, to also serve as the Company’s Chief Financial Officer and Secretary .ITEM 9: CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.We have had no disagreements with our independent registered public accountants with respect to accounting practices, procedures or financial disclosure.ITEM 9A(T): CONTROLS AND PROCEDURES.Evaluation of Disclosure Controls and Proceduresthe Company’sour management, including itsour Chief Executive Officer and Chief Financial Officer, the Companywe conducted an evaluation of the effectiveness of the design and operation of itsour disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, (the “Exchange Act”), as of the end of the period covered by this annual report. Based on this evaluation, the Company’sour Chief Executive Officer and Chief Financial Officer concluded as of December 31, 20082009 that the Company’sour disclosure controls and procedures were effective such that the information required to be disclosed in the Company’sour United States Securities and Exchange Commission (the “SEC”) reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms,form s, and is accu mulatedaccumulated and communicated to the Company’sour management, including itsour Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.reporting of the Company.reporting. Management, with the participation of our chief executive officerChief Executive Officer and chief financial officer,Chief Financial Officer, has evaluated the effectiveness of our internal control over financial reporting as of December 31, 20082009 based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations (COSO). Based on this evaluation, management concluded that, as of December 31, 2008,2009, our internal control over financial reporting is effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.the Company’sour independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’sour independent registered public accounting firm pursuant to temporary rules of the SEC that permit the Companyus to provide only management’s report in this annual report.
None.ITEM 9B. OTHER INFORMATION.None.setsand text set forth the names and ages of all of our current directors and executive officers. We have a Boardofficers as of DirectorsDecember 31, 2009. The board of directors is comprised of three members. Executive officers serve at the discretiononly one class. All of the Boarddirectors will serve until the next annual meeting of Directorsstockholders and are appointed by the Board of Directors. Each director holds office until a successor is duly elected or appointed. Officerstheir successors are elected annually by the Board of Directors and serve at the discretion of the board.qualified, or until their earlier death, retirement, resignation or removal.Name Age Position Director / Officer Since Derek J. Cooper31 32President, Chief Executive Officer, Chief September 2008 Financial Officer, and Director September 2008 Jeet Sidhu 36 37Director September 2008 Christian Hudson 43 45Director September 2008 Harmel S. Rayat 47 President, Chief Executive Officer, Chief March 18, 2006 Financial Officer, and Director Timothy N. Luu 44 Secretary, Treasurer, Chief Technology February 7, 2005 Officer, Director Frank Fabio 57 Chief Financial Officer September 12, 2008 Thereno family relationships between anythe names of ourall directors and executive officers, all positions and other key personnel.Recent Management ChangesWe have recently experienced a change in our management and Board of Directors.Effective on September 12, 2008,offices with us held by each of Messrs. Harmel S. Rayat and Timothy N. Luu resigned fromperson, the Company’s Board of Directors and as an officer of the Company in order to pursue other interests and not as a result of any disagreement between himself and the Company.Effective September 12, 2008, the Board of Directors appointed Mr. Derek J. Cooper to serve as the Company’s President and Chief Executive Officer. After the resignation of the Chief Financial Officer on January 9, 2009, the Board of Directors appointed Mr. Derek J. Cooper Chief Financial Officer.Effective September 12, 2008, the Board of Directors appointed Mr. Jeet Sidhu to serve as a director of the Company, and to serveperiod during which each has served as such, until the next annual meeting of the Company’s shareholdersprincipal occupations and until his successor shall have been duly elected and qualified.Effective September 12, 2008, the Board of Directors appointed Mr. Christian Hudson to serve as a director of the Company, and to serve as such until the next annual meeting of the Company’s shareholders and until his successor shall have been duly elected and qualified.Effective September 12, 2008, Mr. Frank Fabio was appointed our Chief Financial Officer; Mr. Fabio resigned on January 9, 2009.The directors are elected to one-year terms. Each director holds office until the expiration of the director’s term, until the director’s successor has been duly elected and qualified or until the earlieremployment of such director’s resignation, removal or death. Our board of directors does not have an audit or any other committee. The officers servepersons during at least the pleasure of the Board of Directors.The following is a brief description of the business experience of each of the directors and officers during the pastlast five years, and an indication of directorshipsother director positions held by each director in other companies subject tocurrently or during the reporting requirements under the Federal securities law. As of the date of this filing, the members of our Board of Directors and our executive officers were as follows:Bachelor of Science degree in PhysicsB.Sc. in 2001 and his BachelorB.A.Sc. in 2005. Mr. Cooper currently serves on the board of Applied Science in Geological Engineering in 2005, both atdirectors for International Energy, Inc., where he has held this position since January 2005. Previously, Mr. Cooper served on the Universityboard of British Columbia. From January 2003 throughdirectors for Phytomedical Technologies Inc. from September 2003 Mr. Derek J. Cooper joined Syncrude Canada Ltd., the world’s largest producer of crude oil from oil sands. While completing his Applied Sciences degree, from June 2004thruto September 2004, Mr. Cooper undertook and completed a near-term engineering-exploration contract with Stealth Minerals Ltd. From 2005 to March 2008, Mr. Cooper worked at Elk Valley Coal, the world’s second largest producer of metallurgical coal, as a Planning Engineer. In April 2008, Mr. Cooper joined TransAlta Utilities, as an Intermediate Engineer in the Fuel Supply Group where he performs life-of-mine planning, costing, and capital equipment selection as well as scoping/feasibility projects. Mr. Cooper joined the Company as Director on September 12, 2008. Mr. Cooper also serves as a director and officer of International Energy, Inc.Since 2002,From 2002-2009, Mr. Sidhu has beenwas Vice-President of Montgomery Asset Management Corporation, a privately held firm providing financial and management consulting services to emerging growth corporations.Services and Real Estate markets.Compensation of DirectorsOurServices. Mr. Hudson was invited to join the Board of Directors determinesdue to extensive experience in the non-employee directors’ compensation for serving onfinancial services market.and its committees. In establishing director compensation,of Directors.Board is guided by the following goals: past ten years none of our directors, executive officers, promoters or control persons has been: · Compensation should consist· the subject of any bankruptcy petition filed by or against any business of which such person was a combination of cash and equity awards that are designed to fairly paygeneral partner or executive officer either at the directors for workrequired on behalf of a companytime of the sizebankruptcy or within two years prior to that time;scopeother minor offenses);Entheos Technologies, Inc.;any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; · Compensation should aligndirectors’ interests withCommission or the long-term interests of stockholders; and Commodity Futures Trading Commission to have violated a federal or state securities or commodities law; · Compensation should assist with attracting and retaining qualified directors. The Company does not pay director compensationare also employees. Non-employee directors receive between $2,000 and $2,500 per month for their services as directors; each is entitled to be reimbursed for reasonable and necessary expenses incurred on our behalf. During the years ended December 31, 2008, 2007 and 2006, $25,000, $1,500 and $31,800 respectively was paid to directors for services rendered. Stock-based compensation expense relating to director stock option awards totaled $14,519, $0 and $0 for the years ended December 31, 2008, 2007 and 2006 respectively.Each non employee director receives an initial stock option entitling him to purchase up to 50,000 shares of stock at a price per share equal to the closing priceowns more than 10% of our common stock as reportedare required to report their ownership of our common stock and changes to such ownership with the SEC. Based on a review of such reports and information provided to us, we believe that during the Over the Counter Bulletin Board on the datemost recent fiscal year our executive officers and directors have complied with applicable filing requirements under Section 16(a), Based solely upon a review of the option grant;copies of the options vest atforms furnished to us, we believe that during fiscal 2009, the rate of 20% per annum in arrears.We have no other arrangements pursuantSection 16(a) filing requirements applicable to which any our directors and executive officers were compensated during the years ended December 31, 2008 and 2007 for services as a director.In accordance with applicable SEC rules and regulations, the following table reports all compensation the Company paid to non-employee directors during the fiscal year ended December 31, 2008:(1)The amounts in this column represent the monthly cash meeting fee earned by or paid to the Company's non-employee directors for service during the fiscal year ended December 31, 2008. Non-employee directors, excluding Tim Luu, receive between $2,500 and $1,500 monthly cash compensation. Tim Luu received $1,500 semi-annually.(2)This column reflects the dollar amount recognized for financial statement reporting purposes for the fiscal year ended December 31, 2008 in accordance with FAS 123R for stock option awards. For information regarding significant factors, assumptions andmethodologies used in determining the fair value of the Company's stock options, see Note 7. Stock Options.(3) On September 12, 2008 the Company granted a stock option to purchase 50,000 shares of common stock to each to Mr. Sidhu, Mr. Hudson and Mr. Fabio at an exercise price of $1.00 per share. Of each 50,000 grant, the first 10,000 stock options vest on September 12, 2009 and then 10,000 stock options will vest every year thereafter. The fair value of each 50,000 stock option grant was $29,069, estimated using the Black-Scholes Option Pricing Model with the following weighted average assumptions: dividend yield of 0%, expected volatility of 195.38%, risk-free interest rates of 2.970%, and expected lives of 5 years.
Directors’ and Officers’ Liability Insurancedirectorsdirectors’ and officersofficers’ liability insurance coverage. We are currently reviewing insurance policies and anticipate obtaining coverage for our board of directors and officers.Legal ProceedingsDuringpast five years, except as set forth below, noneprincipal functions of the Audit Committee. The full Board monitors our financial reporting process and internal control system and appoints our independent registered public accounting firm.directors, executive officers, promoters orcompany. The code addresses, among other things, conflicts of interest, compliance with disclosure controls and procedures and internal control persons has been:the subjectover financial reporting, corporate opportunities and confidentiality requirements. We have also adopted Corporate Governance Guidelines applicable to our Board of any bankruptcy petition filed by or against any business of which such person was a general partner orexecutive officer either at the time of the bankruptcy or within two years prior to that time;convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and otherminor offenses);subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competentjurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type ofbusiness, securities or banking activities; orfound by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures TradingCommission to have violated a federal or state securities or commodities law.CORPORATE GOVERNANCE
Directors.USU.S. securities exchange and, therefore, not subject to the corporate governance requirements of any such exchange, including those related to the independence of directors. However, at this time, after considering all of the relevant facts and circumstances our Board of Directors has determined that each of Messrs. Sidhu and Hudson are independent from the Company’s management and qualify as “independent directors” under the standards of independence under the applicable National Association of Securities Dealers (“ NASD ”) listing standards. This means that, in the judgment of the Board of Directors, none of those directors (1) is our officer or employee or an officer or employee of the Company or itsany of our subsidiaries or (2) has any direct or indirect relationship with the Companyus that would interfere withwit h the exercise of his independent judgment in carrying out the responsibilities of a director. As a result, the Company haswe have a majority of independent directors as required by the NASD listing standards. Upon our listing on any national securities exchange or any inter-dealer quotation system, we will elect such independent directors as is necessary under the rules of any such securities exchange.Board of Directors Meetings and Committees of the Board of DirectorsDuring the fiscal year ended December 31, 2008, the Board held a total of four meetings. All members of the Board attended at least 75% of all meetings of the Board.The Company does not currently have any standing committees of the Board of Directors. The full Board is responsible for performing the functions of: (i) the Audit Committee, (ii) the Compensation Committee and (iii) the Nominating Committee.Audit CommitteeThe Board does not currently have a standing Audit Committee. The full Board performs the principal functions of the Audit Committee. The full Board monitors the Company's financial reporting process and internal control system and reviews and appraises the audit efforts of the Company's independent accountants.Compensation CommitteeThe Board does not currently have a standing Compensation Committee. The full Board establishes overall compensation policies for the Company and reviews recommendations submitted by the Company’s management.The Board does not currently have a standing Nominating Committee.Code of EthicsOur Board of Directors has adopted a Code of Ethics that establishes the standards of ethical conduct applicable to all directors, officers and employees of our company. The code addresses, among other things, conflicts of interest, compliance with disclosure controls and procedures and internal control over financial reporting, corporate opportunities and confidentiality requirements. We have also adopted Corporate Governance Guidelines applicable to our Board of Directors. The code of ethics is attached as an exhibit to this annual report.Compliance with Section 16(a) of the Exchange ActPursuant to Section 16(a) of the Exchange Act of 1934, the executive officers and directors of the Company in addition to any person who owns more than 10% of the common stock of the Company are required to report their ownership of the common stock of the Company and changes to such ownership with the SEC. Based on a review of such reports and information provided to the Company, the Company believes that during the most recent fiscal year the executive officers and directors of the Company have complied with applicable filing requirements under Section 16(a), Based solely upon a review of the copies of the forms furnished to the Company, the Company believes that during fiscal 2008, the Section 16(a) filing requirements applicable to its directorsexchange.s and executive officers were satisfied. 888-3, 888 3rdStreet SW, Suite 1000, Calgary, Alberta, Canada T2P 5C5. The Board of Directors has approved a process pursuant to which the President review and forward correspondence to the appropriate director or group of directors for response.11:11. EXECUTIVE COMPENSATION.shows,and descriptive materials set forth information concerning compensation earned for the three-year period ended December 31, 2008, the cash compensation paid byservices rendered to the Company as well as certain other compensation paid for such year, toby: the Company's Chief Executive Officer and the Company's other most highly compensated executive officers. No executive officer of the Company had a total annual salary and bonus for the fiscal year ended December 31, 2008 that exceeded $100,000.Summary Compensation Table(1) Each of Messrs. Rayat and Luu resigned all of their respective positions with the Company on September 12, 2008.(2) Other compensation represents fees paid Derek Cooper as a Director of the Company.Stock Option Grants in Last Fiscal YearShown below is further information regarding stock options awarded during 2008 to the named officers: Number of % of Total Securities Options Granted Underlying to Employees Exercise Expiration Name Options in 2008 Price ($/sh) Date Derek J. Cooper 50,000 25% $ 1.00 9/12/2018 Harmel Rayat(1) 0 0 n/a n/a Tim Luu (1) 0 0 n/a n/a (1) Resigned as an officer and director on September 12, 2008.Aggregated Option Exercises During Last Fiscal Year and Year End Option ValuesThe following table shows certain information about unexercised options at year-end with respect to the named officers: Common Shares Underlying Unexercised Market Value of Unexercised Options on December 31, 2008 Options on December 31, 2008 Option Expiration Name Exercisable Unexercisable Exercisable Unexercisable Date Derek J. Cooper 0 50,000 0 $ 25,500 9/12/2018 Harmel Rayat (1) 0 0 0 0 Tim Luu (1) 0 0 0 0 (1) Resigned as an Officer and Director on September 12, 2008.Employment Contracts and Change in Control ArrangementsOn September 12, 2008, the Company and Derek J. Cooper entered into an agreement whereby Mr. Cooper will function as the Company’s President and Chief Executive Officer. Compensation for such position was agreed upon in the amount of $2,500 month. In addition, Mr. Cooper was granted 50,000 options vesting evenly over a five year period on the issuance anniversary date. On January 9, 2009, Derek J. Cooper was named(the “ CEO ”); the Chief Financial Officer after(the “ CFO ”); and the resignationthree other most highly-compensated executive officers other than the CEO and CFO who were serving as executive officers of the Frank Fabio.The Company at the end of the 2009 fiscal year (the “ Named Executive Officers ”).Name and Principal Position Year Salary Other Options Awards Total Derek Cooper 2009 $ 0 $ 44,474 (1) $ 0 $ 44,474 President, CEO, Chief Financial Officer and Director (1) Other compensation represents $30,000 in fees paid Derek Cooper as a Director of the Company and $14,474 in stock-based compensation expense for awards granted to Mr. Cooper on September 12, 2008, for his services as one of our directors. We agreed to pay Mr. Cooper a monthly fee of $2,500 to serve as a member of our Board of Directors and to serve as our President and Chief Executive Officer. There is no written agreement between us and Mr. Cooper regarding this arrangement. Mr. Cooper currently does not devote his full time and attention to our affairs; we do not have any agreement with Mr. Cooper regarding his agreement to serve as an officer. He is, in fact, an independent contractor, and not an employee. On January 9, 2009, Derek J. Cooper was named the Chief Financial Officer after the resignation of Frank Fabio. On September 12, 2008, Mr. Cooper was granted 50,000 options vesting evenly over a five year peri od on the issuance anniversary date. Name Equity Incentive Awards: Number of Securities Underlying Unexercised Unearned Options % of Total Options Granted to Employees in 2009 Exercise Price ($/sh) Expiration Date Derek J. Cooper (1) 10,000 40,000 0 0% $ 1.00 9/12/2018 (1) On September 12, 2008, we granted stock options to purchase up to a total of 50,000 shares of common stock to Mr. Cooper. The stock options have an exercise price of $1.00 per share; the closing price of our common stock on September 12, 2008 was $0.75 per share. The options vest in five equal annual installments of 10,000 options commencing on September 12, 2009, and annually thereafter with final vesting occurring on September 12, 2013. Under the terms of the stock option agreement, the agreement will terminate and there will be no further vesting of options effective as of the date that the executive ceases to be an officer. Name Fees earned or paid in cash (1) Stock awards Aggregate Grant Date Fair Value Option awards Aggregate Grant Date Fair Value Non-equity incentive plan compensation Nonqualified deferred compensation earnings All other compensation (2) Total Jeet Sidhu $ 20,000 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 34,820 Christian Hudson $ 0 $ 0 $ 0 $ 0 $ 0 $ 14,820 $ 14,820 (1) The amounts in this column represent the monthly compensation. (2) The amounts in this column represent stock-based compensation expense granted to Mr. Sidhu and Mr. Hudson (50,000 stock options each) for stock options granted on September 12, 2008. The exercise price per share is $1.00; the options vest at the rate of 10,000 per annum in arrears commencing September 12, 2009. 12:12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED2008:each of our directors;each of our named executive officers; andall of our directors and executive officers as a group.address(unlessaddress (unless otherwise indicated) at 888 3rdStreet, Suite 1000, Calgary, Alberta, T2P 5C5.Person or Group Percent Derek Cooper 10,000 (1)(2)(3) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Christian Hudson 10,000 (1)(2) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 Jeet Sidhu 10,000 (1)(2) 0.0 % 888 3rd Street SW, Suite 1000 Calgary, AB T2P 5C5 1420525 Alberta Ltd. (4) 32,639,800 52 % 1628 West 1st Avenue, Suite 216 Vancouver, BC V6J 1G1 Directors and Executive Officers as a group (3 persons) 30,000 0.0 % 200,000150,000 stock options (50,000 to each of Messrs. Cooper, Hudson, Fabio and Sidhu) were granted on September 12, 2008; the exercise price per share is $1.00; the options vest at the rate of 10,000 per annum in arrears commencing September 12, 2009. Mr. Fabio was appointed the Company’s Chief Financial Officer and Secretary on September 12, 2008 and resigned on January 9, 2009. Under the terms of his Option Agreement the unvested options terminated immediately. None of Mr. Fabio’s options had vested.(5) 1420525 Alberta Ltd. Isis a private corporation the sole shareholder of which is Harmel S. Rayat; Mr. Rayat was our former Chief Executive Officer, Chief Financial Officer, Secretary and director. Mr. Rayat resigned from his positions with us on September 12, 2008.(6) Does not include 6,000,0003,000,000 shares held in separate trust for the benefit of each Mr. Rayat’s two children over which Mr. Rayat has neither voting nor disposition authority; Mr. Rayat disclaims any beneficiallybeneficial ownership interest in and to such shares.13:13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.yearyears ended December 31, 2009 and December 31, 2008, the Companywe incurred $30,000 and $10,000, respectively, in fees paid to the Derek Cooper theour President, Chief Executive Officer and Chief Financial Officer of the Company.Officer. In addition, during September 2008, the Company granted stock options to purchase 50,000 shares of common stock to Mr. Cooper. For the year ended December 31, 2008, the Companywe recorded $14,474 and $4,840 as stock compensation expense related(refer to this stock grant.“Note 6. Stock Options” in the Notes to Financial Statements) for the years ended December 31, 2009 and December 31, 2008, respectively.yearyears ended December 31, 2009 and December 31, 2008, the Company incurred $50,435 and $25,000, respectively, in board fees for our non-employee directors of theCompany. During 2008, the Company granted a total of 150,000 options to purchase common stock to non-employee board members. For the year ended December 31, 2008, the Companydirectors. In addition, we recorded $29,640 and $14,520 as stockstock-based compensation expense relating(refer to these stock grants. During“Note 6. Stock Options” in the year ended December 31, 2007, the Company paid management fees of $1,500Notes to the directors. There is no management or consulting agreements in effect.Accounts payable – related party: As of September 1, 2008, the Company settled all amounts owed a to former director and majority shareholder, amounting to $24,811, outstanding for management fees (the balance was forgiven for no consideration). The amount outstanding was recorded as an increase to additional paid-in capital. As of December 31, 2008 and 2007 accounts payable to related parties were $12,077 and $23,812 respectively.Rent:Until August 31, 2008, the Company’s administrative office was located at 1628 West 1stAvenue, Suite 216, Vancouver, British Columbia, Canada, V6J 1G1. This premise is owned by a private corporation controlled by a former director and majority shareholder. The Company paid rent of $6,663 and $7,812Financial Statements) for the years ended December 31, 20082009 and 2007, respectively. Effective September 1, 2008, the Company closed its administrative office in Vancouver, British Columbia, Canada, terminating all of its employees. There were no severance arrangements with any of the terminated employees.On December 31, 2007, 40,000,000 common shares owned by Mr. Harmel S. Rayat, a director and major shareholder of the Company, originally subscribed for at $0.0033 each were returned to the Company for cancellation and for no consideration. Mr. Harmel S. Rayat was an officer and director of the Company until September 12, 2008, and a majority stockholder of the Company until September 9, 2008.All related party transactions are recorded at the exchange amount established and agreed to between related parties and are in the normal course of business.14:14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.accountants.registered public accounting firm. The Board of Directors of the Company, in its discretion, may direct the appointment of different public accountants at any time during the year, if the Board believes that a change would be in the best interests of the stockholders. The Board of Directors has considered the audit fees, audit-related fees, tax fees and other fees paid to the Company'sour accountants, as disclosed below, and had determined that the payment of such fees is compatible with maintaining the independence of the accountants.The Company does Audit fees $ 49,477 $ 13,417 Tax fees 4,343 7,467 Total $ 53,820 $ 20,884 2007. Year Ended Year Ended December 31, December 31, 2008 2007 Audit fees $20,884 $17,295 Audit-related fees - - Tax fees - All other fees - - Total $20,884 $17,295 PART IV15:15. EXHIBITS, AND FINANCIAL STATEMENT SCHEDULES.10-K/A:1. Financial Statements1. Financial Statements 10-K/A:Report of Independent Registered Public Accounting FirmConsolidated Balance Sheets as of December 31, 2008 and 2007Consolidated Statements of Operations for the years ended December 31, 2008 and 2007Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2008 and 2007Consolidated Statements of Cash Flows for the years ended December 31, 2008 and 2007Notes to Consolidated Financial Statements2. Financial Statement Schedules· Report of Independent Registered Public Accounting Firm · Balance Sheets as of December 31, 2009 and 2008 · Statements of Operations for the years ended December 31, 2009 and 2008 · Statements of Stockholders’ Equity for the years ended December 31, 2009 and 2008 · Statements of Cash Flows for the years ended December 31, 2009 and 2008 · Notes to Financial Statements 2. Financial Statement Schedules 3. Exhibits3. Exhibits 10-K/A.10-K./A for the fiscal year ended December 31, 2008,2009, to be signed on its behalf by the undersigned, thereunto duly authorized on this 1st31th day of October 2009.Entheos Technologies, Inc./s/ Derek J. CooperDerek J. CooperPresident, Chief Executive Office,Chief Financial Officer and DirectorSignature Title Date /s/ Derek Cooper President, Chief Executive Officer, Principal Executive Officer, October 1, 2009March 31, 2010Derek Cooper Chief Financial Officer, and Director Principal Financial Officer, Principal Accounting Officer, and Director /s/ Jeet Sidhu Director October 1, 2009March 31, 2010Jeet Sidhu /s/ Christian Hudson Director October 1, 2009March 31, 2010Christian Hudson Exhibit IndexNo.Description of Exhibit Exhibit No. Description3.1Articles of Exhibit incorporation (exhibit 3.1). S-8 filing dated October 3, 2003. 3.2 Bylaws (exhibit 3.2). S-8 filing dated October 3, 2003. 10.1 Subscription Agreement (exhibit 10.1), Series A Warrant Agreement (exhibit 10.2), Series B Warrant Agreement (exhibit 10.2), Registration Rights Agreement (exhibit 10.4) for 6,450,000 unit private placement on July 28, 2008. 8-K filing dated August 1, 2008. 10.2 Participation Agreement dated September 9, 2008 with respect to the Stahl #1Well located Fayette County, Texas. 8-K filing dated October 24, 2008. 10.3 Participation Agreement dated September 9, 2008 with respect to the Onnie Ray #1 Well located Lee County, Texas. 8-K filing dated October 24, 2008. 10.4 Participation Agreement dated September 9, 2008 with respect to the Haile #1Well located Frio . County, Texas. 8-K filing dated October 24, 2008. 10.5 2001 Incentive Stock Option Plan (exhibit 99.1). S-8 filing dated October 3, 2003. 14.1 Code of Ethics. 10-K filing dated April 14, 2009. 31.1 23.1* Consent of Independent Registered Public Accounting Firm. 31.1* Certification of the Chief Executive Officer pursuant to Rule 13a-14(a).* 32.1 32.1* Certification by the Chief Executive Officer pursuant to 18 U.S.C.1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.* Exhibit 14.1ENTHEOS TECHNOLOGIES, INC.CODE OFCORPORATEGOVERNANCEANDETHICS This Employee Code of Corporate Governance and Ethics appliesall employees, officers and directorsthe incorporation by reference in the Registration Statement on Form S-8 (File No. 333-109449) of Entheos Technologies, Inc, its subsidiaries and affiliates (collectively, “Entheos” or the “Company.” Entheos is proudInc. of its reputation for integrity and honesty and is committed to these core values. Personal responsibility is at the coreour report dated March 31, 2010, on our audits of the Company’s principlesbalance sheets of Entheos Technologies, Inc. as of December 31, 2009 and culture. Entheos’ reputation depends2008, and the related statements of operations, stockholders' equity, and cash flows for the years then ended.you maintainingForm 10-K of Entheos Technologies, Inc. (the “small business issuer”);highest standardsstatements made, in light of conductthe circumstances under which such statements were made, not misleading with respect to the period covered by this report;business endeavors. You have a personal responsibility to protect this reputation, to "domaterial respects the right thing,"financial condition, results of operations and to act with honestycash flows of the registrant as of, and integrity in all dealings with customers, business partners and each other. You should not take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other unfair-dealing practice.The principles set forthfor, the periods presented in this document describe how you should conduct yourself.This Code does not address every expectationreport;conditioncaused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;properthe reliability of financial reporting and ethicalthe preparation of financial statements for external purposes in accordance with generally accepted accounting principles;conduct.Good common sense is your best guide. It does not substitute for Company policiesissuer's disclosure controls and procedures. In every business-related endeavor, you must follow the ethicsprocedures and compliance principles set forthpresented in this Codereport our conclusions about the effectiveness of the disclosure controls and procedures, as well as allof the end of the period covered by this report based on such evaluation; andapplicable corporate policiescertifying officer(s) and procedures. You are accountable for reading, understanding and adhering to this Code. Further, compliance with all laws, rules and regulations related to Company activities is mandatory and your conduct must be such as to avoid even the appearanceI have disclosed, based on our most recent evaluation of impropriety. Failure to so comply could result in disciplinary action, up to and including termination of employment. If you are uncertain about what to do, referinternal control over financial reporting, to the relevant section of this Code. If you are still unsure, speak with your supervisor or, if you prefer, a membersmall business issuer's auditors and the audit committee of the Company’s Corporate Ethicssmall business issuer's board of directors (or persons performing the equivalent functions):Compliance Committee, if any.In the Workplace Entheos is committed to providing a diverse and inclusive work environment, free of all forms of unlawful discrimination, including any type of harassment.Respect The Company’s greatest strength liesmaterial weaknesses in the talent and abilitydesign or operation of its associates. Since working in partnership is vitalinternal control over financial reporting which are reasonably likely to Entheos’ continued success, mutual respect must be the basis for all work relationships. Engaging in behavior that ridicules, belittles, intimidates, threatens or demeans, affects productivity, can negatively impact the Company’s reputation and may violate the law. You are expected to treat others with the same respect and dignity that any reasonable person may wish to receive, creating a work environment that is inclusive, supportive and free of harassment and unlawful discrimination.Equal Employment Opportunity The talents and skills needed to conduct business successfully are not limited to any particular group ofpeople. Entheos has a long-standing commitment to a meaningful policy of equal employment opportunity. The Company’s policy is to ensure equal employment and advancement opportunity for all qualified individuals without distinction or discrimination because of race, color, religion, gender, sexual orientation, gender identity, age, national origin, disability, covered veteran status, marital status or any other unlawful basis. As part of this commitment, Entheos will make reasonable accommodations for applicants and qualified employees.Sexual Harassment and Other Discriminatory Harassment Sexual harassment and other discriminatory harassment are illegal and violate Company policies. Actions or words of a sexual nature that harass or intimidate others are prohibited. Similarly, actions or words that harass or intimidate based on race, color, religion, gender, sexual orientation, gender identity, age, national origin, disability, covered veteran status, marital status or any other unlawful basis are also prohibited.Corporate Governance Certification Program The responsibility for maintaining the Company’s reputation for integrity and compliance rests in large measure on associates who guide its operations and others in particularly sensitive positions. The Corporate Governance Certification Program is designed to have you affirm your compliance with the standards contained in this Code and to help identify situations that may in fact, or in appearance, involve conflicts of interest or other improper conduct. If you are required to complete or update a Corporate Governance Certificate, you must do so in a timely and forthright manner with accurate responses. Above all, you must remember that any act that gives the appearance of being improper can damage Entheos’ reputation and impair the public’s confidence in the Company. All such acts must be avoided. You must acknowledge that you have read and understand this Employee Code of Corporate Governance and Ethics.Conflicts of Interest Company policy prohibits conflicts of interest. A "conflict of interest" occurs when your private interest interferes in any way with the interests of Entheos. In addition to avoiding conflicts of interest, you should also avoid even the appearance of a conflict. A conflict situation can arise when you or a member of your family takes actions or has interests that may make it difficult for you to perform your work for the Company objectively and effectively. A conflict of interest can also arise when you or a member of your family receives improper personal benefits as a result of your position at Entheos. Though it is impossible to list every activity or situation that could present a problem, certain of the more obvious ones are noted below.Corporate Opportunities You owe a duty to Entheos to advance its legitimate interests. You are prohibited from competing with the Company and from using corporate property, information or position for personal opportunities or gain. You may not use or offer for use Entheos resources (time, technology, property or information) for non-Entheos business.Outside ActivitiesOfficer or Director of Another Business Officers and employees may not serve as a director, officer, trustee, partner or in any other principal position of another for-profit or publicly held organization or company without the prior approval of Entheos’Chief Executive Officer (or a designee). Such requests for approval should be directed through the office of the Chief Compliance Officer. You should obtain approval from Entheos’ Chief Executive Officer (or a designee), before agreeing to serve on the board or in a principal position of a trade or professional association or of a non-profit organization. In any event, these outside activities must not impact in any way your daily job responsibilities in your current position.Second Job Your first loyalty as an employee is to the Company. Because employment outside of Entheos could interfere with your responsibilities to Entheos or be detrimental to the Company, you are encouraged to discuss the situation with the Chief Executive Officer or the Chairperson of the Corporate Ethics and Compliance Committee.Communication of Conflicts All potential and actual conflicts of interest or material transactions or relationships that reasonably could be expected to give rise to such a conflict or the appearance of such a conflict must be disclosed. If you have any doubt about whether a conflict of interest exists after consulting this Code, you should seek assistance from the Corporate Ethics and Compliance Committee.Compliance With Laws, Rules and Regulations You are required to comply fully with all laws, rules and regulations affecting Entheos’s business and its conduct in business matters. Regarding international operations, it is expected that the Company will comply with the laws of the countries in which we operate. Where Company policy differs from local law or custom, you should follow the more restrictive policy. Because the laws that are applicable to the Company’s businesses are often very complex and penalties for violations are severe, you should consult the Chief Executive Officer, who may direct you to our legal counsel, if you have any questions or concerns. If you suspect or become aware of a violation by an employee or the Company, it is your responsibility to report this immediately. Certain key laws are listed below.Insider Trading It is unlawful to buy or sell securities on the basis of material, non-public information (whether such information is gained in the course of employment or otherwise) for Company-owned or managed accounts, for personal accounts, or for any accounts that associates may influence, including, but not limited to, accounts of family members. This type of activity is known as "insider trading" and is prohibited by securities laws and Company policy.Information may bematerialif there is a substantial likelihood that the information wouldadversely affect the price of the security or that a reasonable investor would consider the information significant in deciding whether to buy or sell a security. Information is considered to benon-publicif it has not been disclosed to the public. Generally, information is considered disclosed to the public if it has been published in newspapers or other media, has been the subject of a press release or a public filing with the SEC and, in all cases, at least 48 hours has passed since the publication, release or fi ling. Substantial penalties may be assessed against people who trade while in possession of material inside information and can also be imposed upon companies and so-called controlling persons such as officers and directors, who fail to take appropriate steps to prevent or detect insider trading violations by their employees or subordinates. If you violate the Company’s insider trading policy, sanctions imposed by law enforcementofficials, as well as Company-imposed sanctions, up to and including termination of employment, could result.Antitrust Antitrust laws are designed to preserve and foster free and open competition and thereby assure reasonable prices, efficient services and a productive economy. Any activity that reduces or limits free and open competition is subject to antitrust scrutiny. Deliberate or even accidental violations of these laws must not occur. For example, the Company may not agree with competitors to fix prices or terms of financial services, to designate pre-determined geographical areas where each will do business or to boycott anyone.Money Laundering Money laundering involves an attempt to conceal the true source of funds and typically takes one of two forms. There are transactions used to transform the proceeds from illicit activities into funds with an apparently legal source and there are transactions that take legitimate funds and funnel them through organizations to fund illegitimate activities, such as terrorism. Money laundering often involves complex financial transactions and encompasses many different types of financial products and services. Under the existing money laundering laws of the U.S., it is a crime if you engage knowingly in a financial transaction that involves proceeds from criminal activities or is intended to promote illegal activity. Such knowledge includes "willful blindness" to the legitimacy of the source of the funds. Severe penalties, including substantial fines and even imprisonment, can be imposed on companies and their associates for involvement in or failure to report actual or even suspicious activities relating to money laundering.Foreign Corrupt Practices Act The Foreign Corrupt Practices Act (FCPA) prohibits the giving or offering of money or anything of value, including gifts or services:directly or indirectly to a foreign official, a foreign political party or an official or candidate of that party,an officer or employee of the United Nations or other public international organization or a representativeof any foreign official,for the purpose of influencing any act or decision by a foreign official, or for the purpose of persuading aforeign official to use the official’s influence to affect any act or decision of a foreign government oragency or public international organization, or for the purpose of securing any improper advantage, andto assist the Company in doing business.The FCPA does not prohibit any of the following:payments of reasonable and bona fide expenses, such as travel and lodging, that are directly related to thepromotion, demonstration or explanation of a product or service, so long as the payment is not for acorrupt purpose,payments that are legal under a foreign country’s written laws or regulations, and"facilitating" or "expediting" payments of small value to effect routine, non-discretionary governmentalaction (unrelated to the process of awarding business), such as obtaining visas, arranging for utilityhookups or the like, where the practice is usual or customary in the country concerned. While the law allows certain payments to foreign officials to facilitate routine government actions, determining what is a permissible "facilitating" payment involves difficult legal judgments. Therefore, except for legally prescribed fees and similar payments, no payment or gift may be made to a foreign official related to business activities unless the transaction is approved in advance by the General Counsel or a designee. You should make every effort to eliminate or minimize such payments. If such payments are approved, they must be properly recorded in the Company’s books and records. Entheos and its associates will not directly or indirectly engage in bribery, kickbacks, payoffs or other corrupt business practices, in their relations with governmental agencies or customers.Boycotts U.S. antiboycott laws and regulations prohibit or severely restrict the Company from participating in boycotts against countries friendly to the U.S. and require us to report both legal and illegal boycott requests to the government.Financial Management and Disclosure The Company’s goal and intention is to comply with the laws, rules and regulations by which we are governed. In fact, we strive to comply not only with requirements of the law but also with recognized compliance practices. All illegal activities or illegal conduct are prohibited whether or not they are specifically set forth in this Code. Where law does not govern a situation or where the law is unclear or conflicting, you should discuss the situation with the Chief Financial Officer or Chief Executive Officer and management should seek advice from the Company’s General Counsel. Business should always be conducted in a fair and forthright manner. Directors, officers and employees are expected to act according to high ethical standards. The continuing excellence of the Company’s reputation depends upon our full and complete disclosure of important information about the Company that is used in the securities marketplace. Our financial and non-financial disclosures and filings with the SEC must be transparent, accurate and timely. Proper reporting of reliable, truthful and accurate information is a complex process involving cooperation between many departments and disciplines. We must all work together to insure that reliable, truthful and accurate information is disclosed to the public. The Company must disclose to the SEC, current security holders and the investing public information that is required, and any additional information that may be necessary to ensure the required disclosures are not misleading or inaccurate. The Company requires you to participate in the disclosure process, which is overseen by the Chief Fin ancial Officer and/or Chief Executive Officer. The disclosure process is designedregistrant’s ability to record, process, summarize and report financial information; andinformation as required by all applicable laws, rules and regulations. Participationthat involves management or other employees who have a significant role in the disclosure process is a requirement of a public company, and full cooperation and participation byregistrant’s internal control over financial reporting.Date: March 31, 2010 By: /s/ Derek Cooper Derek Cooper President, Chief Executive Officer, Chief Financial Officer and Director and, upon request, other employees inpursuant to 18 U.S.C. 1350disclosure process is a requirementSarbanes-Oxley Act of this Code. Officers and employees must fully comply2002their disclosure responsibilities in an accurate and timely manner or be subject to disciplinethe Annual Report of up to and including termination of employment.Accounting Standardsmaintains its accounting records and prepares its financial statements in accordanceTechnologies, Inc. (the “Company”) on the Form 10-K for the period ending December 31, 2009 as filed with accounting principles generally accepted in the U.S. (GAAP) and with statutory accounting principles, as promulgated by the Securities and Exchange Commission and other regulating authorities. If you are aware or have reason to believe that there are violations of either law or policy regardingon the Company’s financial records or operations, you are obligated to report such information promptly.Audits and Outside Examinations There may be occasions when the operations of Entheos are subject to audit or examination. These reviews may be conducted by the Company’s external auditor, state and federal regulatory agencies. Both the law and Entheos policy require that you cooperate fully with all appropriate requests for information, and prohibit attempting to influence, interfere with or provide inaccurate information in response to a legitimate audit or examination request. You may not fraudulently influence, mislead, manipulate or coerce outside auditors if you know or you are unreasonable in not knowing that by doing so you could render the financial statements materially misleading or affect the auditors in other ways. If you are contacted by an outside agency regarding a financial examination or audit, you must immediately notify the Chief Executive Officer or the Chief Financial Officer before responding. If the contact is initiated by a state or federal agency you should contact the Corporate Ethics & Compliance Committee.Protection and Proper Use of Company Assets Safeguarding and appropriately using Company assets, whether those assets take the form of paper files, electronic data, computer resources, trademarks or otherwise, is critical.Confidentiality Entheos is committed to preserving customer and employee trust. All information, whether it is business, customer or employee-related, must be treated in a confidential manner, and disclosing it is limited to those people who have an appropriate business or legal reason to have access to the information. You need to take special precautions when transmitting information via e-mail, fax, the Internet or other media. Remember to treat all such communications as if they were public documents and printed on letterhead. In addition, Company meetings are confidential. You may not use audio or video equipment to record these meetings without the specific prior authorization of the head of your department.Technology Safeguarding computer resources is critical because the Company relies on technology to conduct daily business. Software is provided to enable you to perform your job and is covered by federal copyright laws. You cannot duplicate, distribute or lend software to anyone unless permitted by the license agreement. Entheos provides electronic mail (e-mail) and Internet access to assist and facilitate business communications. All information stored, transmitted, received, or contained in these systems is the Company’s sole property and is subject to its review at any time. All e-mail and Internet use must be consistent with Entheos’s policies, practices and commitment to ensuring a work environment where all persons are treated with respect and dignity. Because these systems provide access to a worldwide audience, you should act at all times as if you are representing Entheos to the public, and should preserve Entheos’s system security and protect its name and trademarks. You must act responsibly and adhere to all laws and Company policies when using e-mail or the Internet. You must use your computer appropriately in accordance with Company standards and be sure to secure both the computer and all data from loss, damage or unauthorized access.Intellectual Property: Patents, Copyrights And Trademarks Except as otherwise agreed to in writing between the Company and an officer or employee, all intellectual property you conceive or develop during the course of your employment shall be the sole property of the Company. The term intellectual property includes any invention, discovery, concept, idea, or writing whether protectable or not by any United States or foreign copyright, trademark, patent, or common law including, but not limited to designs, materials, compositions of matter, machines, manufactures, processes, improvements, data, computer software, writings, formula, techniques, know-how, methods, as well as improvements thereof or know-how related thereto concerning any past, present, or prospective activities of the Company. Officers and employees must promptly disclose in writing to the Company any intellectual property developed or conceived either solely or with others during the c ourse of your employment and must render any and all aid and assistance, at our expense to secure the appropriate patent, copyright, or trademark protection for such intellectual property. Works of authorship including literary works such as books, articles, and computer programs; musical works, including any accompanying words; dramatic works, including any accompanying music; pantomimes and choreographic works; pictorial, graphic, and sculptural works; motion pictures and other audiovisual works; sound recordings; and architectural works are protected by United States and foreign copyright law as soon as they are reduced to a tangible medium perceptible by humans with or without the aid of a machine. A work does NOT have to bear a copyright notice in order to be protected and without the copyright owner’s permission, no one may make copies of the work, create derivative works, distribute the work, perform the work publicly, or display the work publicly. Copyright laws may protect items posted on a website. Unless a website grants permission to download the Internet content you generally only have the legal right to view the content. If you do not have permission to download and distribute specific website content you should contact the Company’s General Counsel. If you are unclear as to the application of this Intellectual Property Policy, or if questions arise, please consult with the Company’s General Counsel.Additional Matters Pertaining to Directors Annex A hereto, which is incorporated herein by reference, applies to the Company’s directors.AdministrationReporting of Any Illegal or Unethical Behavior; Points of Contact If you are aware of any illegal or unethical behavior or if you believe that an applicable law, rule or regulation or this Code has been violated, the matter must be promptly reported to the Chief Executive Officer, the Chief Financial Officer or the Corporate Ethics & Compliance Committee. In addition, if you have a concern about the Company’s accounting practices, internal controls or auditing matters, you should report your concerns to these same persons or entities. If you have questions about anything in this Code or if you believe Entheos or an associate is violating the law or Company policy or engaging in conduct that appears unethical you may contact anyone of the foregoing entities. You should take care to report violations to a person who you believe is not involved in the alleged violation. All reports of alleged violations will be promptly investigated and, if appropriate date hereof (the “Report”), remedied, and if legally required, immediately reported to the proper governmental authority.You will be expected to cooperate in assuring that violations of this Code are promptly addressed. Entheos has a policy of protecting the confidentiality of those making reports of possible misconduct to the maximum extent permitted by law.In no event will there be any any retaliation against someone for reporting an activity that he or she in good faith believes to be a violation of any law, rule, regulation, internal policy or this Code.Any supervisor intimidating or imposing sanctions on someone for reporting a matter will be subject to discipline up to and including termination. You should know that it is unlawful to retaliate against a person, including with respect to their employment, for providing truthful information to a law enforcement officer relating to the possible commission of any federal offense. Employees who allege that they have been retaliated against for providing information to a federal agency, Congress or a person with supervisory authority over the employee about suspected fraud may file a complaint with the Department of Labor, or in federal court if the Department of Labor does not take action.Responding to Improper Conduct This Code will be enforced on a uniform basis for everyone without regard to his or her position. Violators of this Code will be subject to disciplinary action. Supervisors and managers of a disciplined employee or an employee reporting a violation may also be subject to disciplinary action for failure to properly oversee an employee’s conduct, or for retaliation against an employee who reports a violation. The response will depend upon a number of factors including whether the improper behavior involved illegal conduct. Disciplinary action may include, but is not limited to, reprimands and warnings, probation, suspension, demotion, reassignment, reduction in compensation or termination. In any disciplinary action arising from violations of this Code, prior truthful disclosure, or the failure to fully disclose the issue and all pertinent information with respect to the issue, will weigh heavily in the disposition of the matter. Certain actions and omissions prohibited by the Code might also be unlawful and could lead to individual criminal prosecution and, upon conviction, to fines and imprisonment. Waivers of or exceptions to this Code will be granted only under exceptional circumstances. There shall be no amendment or modification to this Code except by a vote of the Board of Directors or a designated board committee that will ascertain whether an amendment or modification is appropriate. In case of any amendment or modification of this Code that applies to an officer or director of the Company, the amendment or modification shall be made publicly available.ACKNOWLEDGMENTOFRECEIPTOFCODE OFCORPORATEGOVERNANCEANDETHICShave received and read the Company's Code of Corporate Governance and Ethics (including to the extent applicable, Annex A thereto). I understand the standards and policies contained in the Company Code of Corporate Governance and Ethics and understand that there may be additional policies or laws specific to my job. I further agree to comply with the Company Code of Corporate Governance and Ethics. If I have questions concerning the meaning or application of the Company Code of Corporate Governance and Ethics, any Company policies, or the legal and regulatory requirements applicable to my job, I know I can consult theDerek Cooper, President, Chief Executive Officer, Chief Financial Officer or a member of the Corporate Ethics & Compliance Committee, if any, knowing that my questions or reports to these sources will be maintained in confidence.Signature: ________________________Name (print): ______________________Date: __________________Position: __________________Address: ___________________________ ___________________________Annex AToENTHEOS TECHNOLOGIES, INC.AMENDED ANDRESTATEDCODE OFCORPORATEGOVERNANCEANDETHICSPROVISIONSRELATED TODIRECTORS1.Responsibilities and Functions of Board of Directors The Board of Directors, elected each year by the Company’s stockholders at an annual meeting of stockholders, fosters and encourages an environment of strong disclosure controls and procedures, including internal controls, financial accountability, high ethical standards and compliance with applicable policies, laws and regulations. The primary responsibility of members of the Company's Board of Directors is to uphold the best interestsDirector of the Company, and its stockholderscertify, pursuant to 18 U.S.C. ss. 1350, as a whole by overseeing the managementadopted pursuant to ss.906 of the Company's business and affairs. WhileSarbanes-Oxley Act of 2002, that:Board may call special meetings in order to address specific needsReport filed by the Company fully complies with the requirements of Section 13(a) or 15(d) of the Company from time to time, it is generally expectedSecurities Exchange Act of 1934; andBoardfinancial condition and results of Directors will meet at regular intervals and are expected to hold approximately four meetings or more per fiscal year during which the Board will perform a number of specific functions, inclu ding but not limited to:a. Reviewing and discussing the performance of the Company, as well as any immediate issues facing the company;b. Reviewing, approving and monitoring fundamental financial and business strategies and major corporate actions;c. Ensuring processes are in place for maintaining the integrity of its financial statements, the integrity of compliance with law and ethics andd. Assessing and reviewing major risks facing the Company and planning options, if any, for their mitigation. Board members are encouraged to suggest the inclusion of item(s) for the agenda for each quarterly meeting of the Board of Directors in consultation with each other and senior management of the Company. It is expected that each Director will make every effort to attend each Board meeting. While attendance in person is preferred, attendance by teleconference is permitted if necessary under the circumstances. The proceedings and deliberations of the Board are confidential. Each Director will maintain the confidentiality of information received in connection with his or her service as a Director.2.Board Access to Management At all times, Board members shall be able to freely access Company management without hindrance or undue delay while ensuring that such contact is not distracting to the business operations of the Company on the dates and that such contact, if in writing, is copiedfor the periods presented therein.ENTHEOS TECHNOLOGIES, INC. By: /s/ Derek Cooper ChairmanSarbanes-Oxley Act of 2002 and Chief Executive Officer. In addition, management mayshall not be invited to attend Board meetings, during which time management may briefdeemed filed by the Board on itemsCompany for purposes of particular interest and/or concern. Senior management is encouraged to offer presentations at such meetings by individuals who can provide additional insight into items being considered or who may have potential for greater responsibility and should be given exposure toSection 18 of the Board.3.Board Access to Independent/Outside Advisors As may beSecurities Exchange Act of 1934, as amended. A signed original of this written statement required by applicable law or rule, the Board of Directors has the authority, when it should be deemed necessary to carry out its duties, to retain independent legal, financialSection 906, or other advisors and to approve each such advisor's fees and other retention terms atdocument authenticating, acknowledging, or otherwise adopting the expensesignature that appears in typed form within the electronic version of the Company.4.Size of Board The Company's Bylaws provides that the number of Directors shall be fixed from time to time by the Board of Directors, but in no event shall be less than the minimumthis written statement required by law. The Board should be large enough to maintain the Company’s required expertise but not too large to function efficiently. At this time, the Board of Directors believes that the optimal number of Board members is five (5), while recognizing and allowing however, for changing circumstances that may warrant a higher or lower number from time to time.5.Ethics and Conflicts of Interest of the Board All Directors, as well as officers and employees, are expected to act ethically at all times and to acknowledge their adherence to the policies comprising the Company's Code of Ethics. At any time that a Board member develops an actual or potential conflict of interest with the Company, the conflict should be reported without delay to the Chairman of the Board and Chief Executive Officer. In the event that a conflict of interest cannot be effectively resolved, the Board member shall resign. Should a member of the Board or any member of his or her immediate family have a matter before the Board in which they have a personal interest, then this interest and the material facts and relationships relating thereto must be disclosed promptly. Furthermore, if a Board member becomes aware of a business opportunity that could be of potential benefitSection 906, has been provided to the Company then he or she must first introduce th is opportunityand will be retained by the Company and furnished to the Board of Directors for considerationSecurities and not endeavor to profit personally from the opportunity unless the Company declines to pursue it.6.Criteria and Selection of Board MembershipThe Board of Directors is responsible to the Company’s stockholders for identifying and recommending the most qualified Director candidates to fill newly created directorship positions and vacancies and further recommend these candidates for election by stockholders. Directors should possess the highest personal and professional ethics, responsibility, fairness, integrity and values and be committed to representing the long-term interests of the Company’s stockholders. They must also have an inquisitive and objective perspective, practical wisdom and mature judgment. The Company’s general counselExchange Commission or its Chief Financial Officer shall be responsible for providing an orientation for all new Directors and for periodically providing materials or briefing sessions on subjects that would assist Directors in discharging their duties. Each new Director shall, within six weeks of election to the Board, spend a reasonable amount of time at corporate headquarters for an in-depth overview of the Company's strategic plans, its financial statements and key policies and practices. Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively and should be committed to serve on the Board for an extended period of time. Directors should offer their resignation in the event of any significant change in their personal circumstances, including a change in their principal job responsibilities or in the event that a conflict of interest cannot be effectively resolved.7.Term Limits for Board Members There is no time term-limit for service to the Board, nor does the Board believe that a term limit should be established. By abstaining from term limits, the Company believes it can successfully retain Board members who, over time, have been able to garner industry knowledge and are intimate with the Company’s operations. Such Directors are able to significantly contribute to the Board’s function since they have helped to foster theCompany’s corporate vision and better understand industry trends.8.Outside Board DirectorshipsDirectors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively. Since service to the Company’s Board of Directors may require significant time and responsibility commitments, although not mandatory, Board members are encouraged to limit the number of public company boards that they may concurrently serve on to four. Board members shall notify the Chairman and Chief Executive Officer of any and/or all other public company boards on which they may serve or to which they have received an invitation to serve prior to accepting such positions.9.Board Performance Assessment and ReviewMeaningful Board evaluation may require a self-assessment of the effectiveness of the full Board and individual Directors. Accordingly, the Board shall perform an annual self-evaluation through its Directors. This review may require establishing protocols and procedures for evaluation of individual Board members in order to ensure that each sitting member brings expertise that is relevant to the Company’s needs at that time and that the skills and contributions of the Directors are conducive to the Board’s function as a group. While individual Board member review may be of value, the purpose of this evaluation is to increase the effectiveness of the Board, not to focus on the performance of individual Board members.10.Stock Option Grants and Cash Compensation Directors, Officers, employees of and consultants to the Company, selected by the Board of Directors may be eligible to receive stock grants in accordance with the terms of the Company’s Incentive Stock Compensation Plan, as in effect from time to time. The grant may be in the form of a stock award, restricted stock purchase offer, incentive stock option or a non-statutory option. The Board of Directors designates the times at which the grant will be made, the type and number of options (and the number of shares subject to those options) or stock awards to be granted. In addition Board members may be eligible for cash compensation in accordance with the Company’s compensation guidelines. All Board members will be reimbursed for travel and related meeting attendance expenses.11.Prohibition on Personal Loans The Company and the Board of Directors will not engage in offering or making available credit or loan arrangements to any member of the Board or the Company’s executive management.
55