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<SEC-DOCUMENT>0000797542-06-000008.txt : 20060516
<SEC-HEADER>0000797542-06-000008.hdr.sgml : 20060516
<ACCEPTANCE-DATETIME>20060516155205
ACCESSION NUMBER:		0000797542-06-000008
CONFORMED SUBMISSION TYPE:	SB-2/A
PUBLIC DOCUMENT COUNT:		3
FILED AS OF DATE:		20060516
DATE AS OF CHANGE:		20060516

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ZAXIS INTERNATIONAL INC
		CENTRAL INDEX KEY:			0000797542
		STANDARD INDUSTRIAL CLASSIFICATION:	BLANK CHECKS [6770]
		IRS NUMBER:				680080601
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		SB-2/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-133179
		FILM NUMBER:		06845826

	BUSINESS ADDRESS:	
		STREET 1:		115 EAST 57TH STREET
		STREET 2:		SUITE 1118
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022
		BUSINESS PHONE:		646-202-9679

	MAIL ADDRESS:	
		STREET 1:		115 EAST 57TH STREET
		STREET 2:		SUITE 1118
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	INFERGENE CO
		DATE OF NAME CHANGE:	19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>SB-2/A
<SEQUENCE>1
<FILENAME>zaxs.htm
<DESCRIPTION>REGISTRATION STATEMENT ON FORM SB-2/A
<TEXT>
<html>

<head>
<title>SB-2/A</title>
</head>

<body bgcolor="#ffffff">
<div>

<hr SIZE="4" NOSHADE COLOR="#000000">

<hr SIZE="2" NOSHADE COLOR="#000000">

<p align="left"><font size="2">As filed with the Securities and Exchange Commission on May
16, 2006. </font></p>

<p ALIGN="CENTER"><b><font FACE="TIMES NEW ROMAN, TIMES, SERIF" SIZE="4">UNITED STATES<br>
SECURITIES AND EXCHANGE COMMISSION<br>
</font><font FACE="TIMES NEW ROMAN, TIMES, SERIF" SIZE="3">Washington, D.C. 20549<br>
</font></b><font face="Times New Roman, Times, Serif" size="1">_________________________________<br>
<br>
</font><font SIZE="4" FACE="Times New Roman, Times, Serif"><strong>FORM SB-2/A<br>
</strong></font><font face="Times New Roman, Times, Serif" size="1">_________________________________</font></p>

<p style="MARGIN: 0in 0in 0pt 0.5in; COLOR: windowtext; TEXT-INDENT: -0.5in"
align="center"><font style="FONT-WEIGHT: bold; FONT-SIZE: 12pt" size="3"><b>REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933</b></font></p>

<p style="MARGIN: 0in 0in 0pt; COLOR: windowtext"><font size="1">&nbsp; &nbsp; </font></p>

<p style="FONT-SIZE: 10pt; MARGIN: 0in 0in 0pt; COLOR: windowtext; TEXT-ALIGN: center"
align="center"><font style="FONT-SIZE: 10pt" face="Times New Roman" size="2">Registration
Number: 333-133179</font></p>

<p style="FONT-SIZE: 10pt; MARGIN: 0in 0in 0pt; COLOR: windowtext; TEXT-ALIGN: center"
align="center"><font size="1">&nbsp; </font></p>

<p ALIGN="center"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="5"><b>ZAXIS
INTERNATIONAL INC.<br>
</b></font><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">(Exact Name Of Registrant
As Specified In Its Charter)</font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td width="33%" align="center"><font size="2"><u>Delaware</u></font></td>
    <td width="33%"><p align="center"><u><font size="2">6770</font></u></td>
    <td width="34%" align="center"><font size="2"><u>68-0080601</u></font></td>
  </tr>
  <tr>
    <td width="33%" align="center" height="0%"><font size="1">(State of Incorporation)</font></td>
    <td width="33%" height="0%"><p align="center"><font style="Times New Roman" size="1">(Primary
    Standard Industrial Code No.)</font></td>
    <td width="34%" align="center" height="0%"><font size="1">(I.R.S. Employer Identification
    No.)</font></td>
  </tr>
</table>

<table border="0" cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td width="50%">&nbsp; </td>
    <td width="50%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="1">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="50%"><p align="center"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="2">115
    East 57th Street, Suite 1118</font></td>
    <td width="50%"><p align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ivo Heiden</font></td>
  </tr>
  <tr>
    <td width="50%"><p align="center"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="2">New
    York, NY 10022</font></td>
    <td width="50%"><p align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">115 East 57th
    Street, Suite 1118</font></td>
  </tr>
  <tr>
    <td width="50%"><p align="center"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="2"><u>Phone:
    (646) 202-9679 Fax: (646) 202-9681</u></font></td>
    <td width="50%"><p align="center"><u><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">New York, NY 10022</font></u></td>
  </tr>
  <tr>
    <td width="50%"><p ALIGN="center"><font style="Times New Roman" size="1">(Address and
    telephone number of principal executive offices)</font></td>
    <td width="50%"><p ALIGN="center"><font style="FONT-SIZE:" size="1">(Name, address and
    telephone number of agent for service)</font></td>
  </tr>
</table>

<p ALIGN="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If any of the
securities being registered on this Form are to be offered on a delayed or continuous
basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: <font
style="DISPLAY: inline; FONT-FAMILY: Wingdings">&#120<br>
</font>If this Form is filed to register additional securities for an offering pursuant to
Rule 462(b) under the Securities Act, please check the following box and list the
Securities Act registration statement number of the earlier effective registration
statement for the same offering. </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168<br>
</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities
Act, check the following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&nbsp;<br>
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the
Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168<br>
</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If
delivery of the prospectus is expected to be made pursuant to Rule 434, please check the
following box. &nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168</font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%" height="0%"
style="border-left: 1px none rgb(0,0,0); border-right: 1px none rgb(0,0,0)">
  <tr>
    <td width="100%"><p align="center"><font size="2">Calculation of Registration Fee</font></td>
  </tr>
</table>

<table border="0" cellpadding="0" cellspacing="0" width="100%" height="0%">
  <tr>
    <td width="27%"
    style="border-left: 1px solid rgb(0,0,0); border-top: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><p align="left"><font size="1">Title of Securities To Be Registered</font></td>
    <td width="13%"
    style="border-left: 1px solid rgb(0,0,0); border-top: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><p align="center"><font size="1">Amount Being Registered</font></td>
    <td width="24%"
    style="border-left: 1px solid rgb(0,0,0); border-top: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><p align="center"><font size="1">Proposed Maximum Offering Price Per Share(1)</font></td>
    <td width="20%"
    style="border-left: 1px solid rgb(0,0,0); border-top: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><p align="center"><font size="1">Proposed Maximum Aggregate Offering Price</font></td>
    <td width="20%" style="border: 1px solid rgb(0,0,0)" height="0%"><p align="center"><font
    size="1">Amount of Registration Fee</font></td>
  </tr>
  <tr>
    <td width="27%"
    style="border-left: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)" height="0%"><font
    size="2">Common Stock, $0.0001 per share</font></td>
    <td width="13%"
    style="border-left: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)" height="0%"><p
    align="center"><font size="2">76,400,000</font></td>
    <td width="24%"
    style="border-left: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)" height="0%"><p
    align="center"><font size="2">$0.02</font></td>
    <td width="20%"
    style="border-left: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)" height="0%"><p
    align="center"><font size="2">$1,528,000</font></td>
    <td width="20%"
    style="border-left: 1px solid rgb(0,0,0); border-right: 1px solid rgb(0,0,0); border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><p align="center"><font size="2">$163.34</font></td>
  </tr>
  <tr>
    <td width="100%"
    style="border-left: 1px none rgb(0,0,0); border-right: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    colspan="5" height="0%"><font size="1">(1) Estimated solely for purposes of calculating
    the registration fee in accordance with Rule 457(c) under the Securities Act of 1933,
    using the average of the quoted price as reported on the NASD Bulletin Board on March 28,
    2006, which was $0.02 per share.</font></td>
  </tr>
</table>

<p ALIGN="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">The
registrant amends this Registration Statement on such date or dates as may be necessary to
delay its effective date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting pursuant to said
Section 8(a) may determine.</font></p>

<hr SIZE="2" NOSHADE COLOR="#000000">

<hr SIZE="4" NOSHADE COLOR="#000000">
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; COLOR: red; FONT-FAMILY: Times New Roman"><strong>The
information in this prospectus is not complete and may be changed. We may not sell these
securities until the registration statement filed with the Securities and Exchange
Commission is effective. This prospectus is not an offer to sell these securities and is
not soliciting an offer to buy these securities in any state where the offer or sale is
not permitted.</strong></font></p>

<p align="center">&nbsp;</p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" color="#FF0000"><strong>PRELIMINARY
PROSPECTUS SUBJECT TO COMPLETION, DATED MAY 16, 2006</strong></font></p>

<p align="left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </p>

<p align="left"><strong>PROSPECTUS</strong></p>

<p align="center"><font size="6"><strong>Zaxis International Inc.</strong></font></p>

<p align="center">76,400,000 Shares</p>

<p align="center">Common Stock</p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This prospectus
relates to the sale by the selling stockholders of 76,400,000 currently outstanding shares
of our common stock. The shares of common stock are being registered to permit the selling
stockholders to sell the shares from time to time in the public market. The stockholders
may sell the shares through ordinary brokerage transactions, directly to market makers of
our shares or through any other means described in the section entitled &#147;Plan of
Distribution&#148; beginning on page 11. We cannot assure you that the selling
stockholders will sell all or any portion of the shares offered in this prospectus.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are not selling
any shares of common stock in this offering and therefore will not receive any proceeds
from this offering. All costs associated with this registration will be borne by us. </font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our common stock is
currently quoted on the NASD Bulletin Board under the symbol ZAXS. The last reported sale
price for our common stock on May 11, 2006, was $0.015 per share.</font></p>

<p align="left" style="text-align: justify"><strong><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Investing in our
common stock involves substantial risks. See &quot;Risk Factors&quot; beginning on page 6
of this prospectus for a discussion of information that should be considered in connection
with an investment in our stock.</font></strong></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We may amend or
supplement this prospectus from time to time by filing amendments or supplements as
required. You should read the entire prospectus and any amendments or supplements
carefully before you make your investment decision.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Neither the
Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.</strong></font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&nbsp;&nbsp;&nbsp;
ZAXIS INTERNATIONAL INC.</strong></font></p>

<p align="center"><a name="TABLE OF CONTENTS"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>TABLE OF
CONTENTS </strong></font></a></p>
<div align="left">

<table cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td align="left" valign="middle" width="95%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><p>&nbsp;</p>
    </div></td>
    <td align="left" valign="bottom" width="5%" style="BORDER-BOTTOM: black thin solid"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><p><font
    size="1">Page</font></strong></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#PROSPECTUS SUMMARY">Prospectus Summary</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>5</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#RISK FACTOR">Risk Factors</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>6</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#USE OF PROCEEDS">Use of Proceeds</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>11</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#SELLING STOCKHOLDERS">Selling Stockholders</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>11</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#PLAN OF DISTRIBUTION">Plan of Distribution</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>11</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS">Market for Common Equity
    and Related Stockholder Matters</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>13</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#DESCRIPTION OF BUSINESS">Description of Business</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>14</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#DESCRIPTION OF PROPERTY">Description of Property</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>17</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#LEGAL PROCEEDINGS">Legal Proceedings</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>17</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN OF OPERATION">Management&#146;s
    Discussion and Analysis of Financial Condition and Plan of Operations</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>18</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#MANAGEMENT">Management</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>19</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#EXECUTIVE COMPENSATION">Executive Compensation</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>19</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS">Certain Relationships and Related
    Transactions</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>19</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT">Security Ownership
    of Certain Beneficial Owners and Management</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>19</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#DESCRIPTION OF SECURITIES">Description of Securities</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>19</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#INDEMNIFICATION FOR SECURITIES ACT LIABILITIES">Indemnification for Securities Act
    Liabilities</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>20</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#LEGAL MATTERS">Legal Matters</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>21</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#EXPERTS">Experts</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>21</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#ADDITIONAL INFORMATION">Additional Information</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>21</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="top" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#ZAXIS INTERNATIONAL INC.">Index to Financial Statements</a></font></p>
    </div></td>
    <td align="right" valign="bottom" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>22</font></p>
    </div></td>
  </tr>
</table>
</div>

<p>&nbsp;</p>

<hr>

<p align="center"><strong><font size="2">You should only rely on the information contained
or incorporated by reference in this prospectus. We have not authorized anyone to provide
you with different information.</font></strong></p>

<hr>

<p>&nbsp;</p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><font size: 10pt; font-family: times new roman" size="2"><strong><a
name="PROSPECTUS SUMMARY">PROSPECTUS SUMMARY</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p>The following summary highlights selected information contained in this prospectus.
This summary does not contain all the information you should consider before investing in
our common stock. Before making an investment decision, you should read the entire
prospectus carefully, including the &#147;Risk Factors&#148; section, the financial
statements and the notes to the financial statements. As used throughout this prospectus,
the terms &quot;Zaxis, the &quot;Company&quot;, the &quot;Registrant&quot;,
&quot;we,&quot; &quot;us,&quot; and &quot;our&quot; refer to Zaxis International Inc.</p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
Offering</strong></font></p>
<div align="left">

<table cellpadding="0" cellspacing="0" width="100%" height="0%">
  <tr bgcolor="#ccffcc">
    <td align="justify" valign="middle" width="46%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common stock
    outstanding before offering</font></p>
    </div></td>
    <td align="justify" valign="middle" width="54%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>92,931,155
    shares</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="justify" valign="middle" width="46%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common stock
    offered by selling stockholders</font></p>
    </div></td>
    <td align="justify" valign="middle" width="54%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>76,400,000
    shares representing approximately 82.21%</font></p>
    </div></td>
  </tr>
  <tr>
    <td align="justify" valign="middle" width="46%" height="0%"></td>
    <td align="justify" valign="middle" width="54%" height="0%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">of our current
    outstanding stock.</font></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="justify" valign="middle" width="46%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common stock to
    be outstanding after the offering</font></p>
    </div></td>
    <td align="justify" valign="middle" width="54%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>92,931,155
    shares</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="justify" valign="middle" width="46%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Use of proceeds</font></p>
    </div></td>
    <td align="justify" valign="middle" width="54%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>We will not
    receive any proceeds from the sale</font></p>
    </div></td>
  </tr>
  <tr>
    <td align="justify" valign="middle" width="46%" height="0%"></td>
    <td align="justify" valign="middle" width="54%" height="0%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">of the common stock
    hereunder.</font></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="justify" valign="middle" width="46%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: -5.4pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>NASD Bulletin
    Board Symbol</font></p>
    </div></td>
    <td align="justify" valign="middle" width="54%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="justify"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>ZAXS</font></p>
    </div></td>
  </tr>
  <tr>
    <td align="justify" valign="middle" width="46%" height="0%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Risk Factors</font></td>
    <td align="justify" valign="middle" width="54%" height="0%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Investing in our
    common stock involves a high degree of risk. See &quot;Risk Factors&quot; beginning on
    page&nbsp;6 to read about risk factors you should consider before investing in of our
    common stock.</font></td>
  </tr>
</table>
</div>

<p align="center"><strong><font size="2">Summary Financial Data</font></strong></p>

<p align="left" style="text-align: justify"><font size="2">The following table summarizes
the relevant financial data for our business and should be read with our financial
statements, which are included in this prospectus. Our current operations are limited to
seeking a business combination with an operating company and therefore our business
operations are insignificant. As a result, only balance sheet data is presented.</font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%" height="0%">
  <tr>
    <td width="70%" height="0%"></td>
    <td width="2%" height="0%"></td>
    <td width="13%" height="0%"><p align="right"><strong><font size="1">March 31, 2006</font></strong></td>
    <td width="2%" height="0%"></td>
    <td width="13%" height="0%"><p align="right"><strong><font size="1">December 31, 2005</font></strong></td>
  </tr>
  <tr>
    <td width="70%" height="0%"></td>
    <td width="2%" height="0%"></td>
    <td width="13%" height="0%" style="border-bottom: 1px solid rgb(0,0,0)">&nbsp; </td>
    <td width="2%" height="0%"></td>
    <td width="13%" height="0%" style="border-bottom: 1px solid rgb(0,0,0)"><p align="right"><font
    size="1">(Audited)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="1">&nbsp; </font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="2">Balance Sheet Data:</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="2">Working capital/(deficiency)</font></td>
    <td width="2%" height="0%"><p align="right"><font size="2">$</font></td>
    <td width="13%" align="right" height="0%"><font size="2">(5,701)</font></td>
    <td width="2%" height="0%"><p align="right"><font size="2">$</font></td>
    <td width="13%" align="right" height="0%"><font size="2">(3,157)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="2">Total assets</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">2,917</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">461</font></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="2">Total liabilities </font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">(8,618)</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">(3,618)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0%"><font size="2">Stockholders' equity (deficiency)</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">(5,701)</font></td>
    <td width="2%" height="0%"></td>
    <td width="13%" align="right" height="0%"><font size="2">(3,157)</font></td>
  </tr>
</table>

<p align="center"><strong><font size="2">Zaxis International Inc.</font></strong></p>

<p align="justify" style="text-align: justify"><font size="2">The Registrant was a
biotechnology holding company that operated its business through a wholly owned
subsidiary. Zaxis was incorporated in Ohio in 1989. On August 25, 1995, Zaxis merged with
a subsidiary of The InFerGene Company (&quot;InFerGene&quot;) and InFerGene changed its
name to Zaxis International Inc. For accounting and tax purposes, the merger was treated
as a reverse acquisition. InFerGene and its subsidiary were inactive and had no assets or
liabilities at the time of the merger. InFerGene was incorporated in California in 1984
and subsequently changed its domicile to Delaware in 1985.</font></p>

<p align="justify"><font size="2">Zaxis was a manufacturer and distributor of products
that were used in a molecular separation process known as electrophoresis, a procedure
used in more than 55,000 research, industrial and clinical laboratories worldwide. The
more common applications of this procedure include protein-based separations such as the
HDL and LDL components and sub-components of cholesterol, the identification of various
genes and gene products (e.g. DNA, RNA, etc.) and the separation and identification of
proteins in drug discovery applications (Proteomics). A variety of techniques, formats,
materials, compounds, equipment and devices are employed in electrophoresis and Zaxis
provided products to meet these needs. The primary focus of the Company's former research
and development efforts as well as its former sales and marketing efforts were targeted
toward the consumables segment of this market. The Company's core products were the
pre-cast gels and reagents used in these electrophoresis procedures.</font></p>

<p align="justify"><font size="2">The Company believed that its products were well
positioned to take advantage of rapidly growing markets. The Company was not able to
generate sufficient revenues to support its operating expenses during fiscal year 2002. In
addition, the Company was not able to raise additional capital to fund its negative cash
flow from operations through borrowings or equity financing to support and expand its
business plan. As a result, the Company ceased operations during the fourth quarter in
2002 and filed a voluntary Chapter 7 bankruptcy petition.</font></p>

<p align="justify"><font size="2">On November 6, 2002, the Registrant filed a voluntary
Chapter 7 petition under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court Northern
District of Ohio (case no. 02-55160). </font><font face="Times New Roman" size="2">As a
result of the Chapter 7 petition, the Registrant's assets were transferred to a United
States Trustee and the Registrant terminated its business operations.</font><font size="2">
</font><font face="Times New Roman" size="2">During 2003 and 2004, the Bankruptcy Trustee
had disposed of substantially all of the assets of the Registrant and its subsidiaries. </font><font
size="2">On October 13, 2004, the Bankruptcy Court approved an Order confirming the sale
of debtor's interest in personal property to Park Avenue Group Inc. and confirming that
Park Avenue Group, Inc. is a good faith purchaser pursuant to 11 USC Section 363(m).</font></p>

<p align="justify"><font size="2" color="#000000">By filing under Chapter 7 of the US
Bankruptcy Code, all of the Registrant&#146;s assets and liabilities, including those of
its subsidiary, were transferred into the estate of the debtor which estate was
administered by the trustee appointed by the US Bankruptcy Court.</font></p>

<p align="left" style="text-align: justify"><font size="2">The Company intends to effect a
merger, capital stock exchange, asset acquisition or other similar business combination
with a currently unidentified operating business with growth potential. Our efforts in
identifying a prospective target business will not be limited to a particular industry. We
intend to concentrate on businesses that we believe are financially stable and have the
opportunity for long-term growth. It is likely that we will have the ability to effect
only a single business combination. Our offices are located at 115 East 57th Street, Suite
1118, New York, New York 10022 and our telephone number is (646) 202-9679.</font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><strong><font size="2"><a name="RISK FACTOR">RISK FACTOR</a> </font></strong><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font style="Times New Roman" size="2">Any
investment in our shares of common stock involves a high degree of risk. You should
carefully consider the following information about these risks, together with the other
information contained in this prospectus before you decide to invest in our common stock.
Each of the following risks may materially and adversely affect our business objective,
plan of operation and financial condition. These risks may cause the market price of our
common stock to decline, which may cause you to lose all or a part of the money you
invested in our common stock. We provide the following cautionary discussion of risks,
uncertainties and possible inaccurate assumptions relevant to our business plan.</font></p>

<p align="left"><font size="2">In addition to other information included in this annual
report, the following factors should be considered in evaluating the Company's business
and future prospects.</font></p>

<p align="center"><strong><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">RISKS RELATED TO
OUR BUSINESS</font></strong></p>

<p align="justify"><strong><font size="2"><em>The Company has a limited operating history
and very limited resources.</em></font></strong></p>

<p align="justify"><font size="2">Since emerging from bankruptcy, the Company's operations
have been limited to seeking a potential business combination and has had no revenues from
operations. Investors will have no basis upon which to evaluate the Company's ability to
achieve the Company's business objective, which is to effect a merger, capital stock
exchange, acquire an operating business. The Company will not generate any revenues until,
at the earliest, after the consummation of a business combination or seeking new business
opportunities.</font></p>

<p align="justify"><strong><font size="2"><em>Since the Company has not currently selected
a particular target industry or target business with which to complete a business
combination, the Company is unable to currently ascertain the merits or risks of the
business' operations.</em></font></strong></p>

<p align="justify"><font size="2">Since the Company has not yet identified a particular
industry or prospective target business, there is no basis for investors to evaluate the
possible merits or risks of the particular industry in which the Company may ultimately
operate or the target business which the Company may ultimately acquire. To the extent the
Company completes a business combination with a financially unstable company or an entity
in its development stage, the Company may be affected by numerous risks inherent in the
business operations of those entities. Although the Company's Management will endeavor to
evaluate the risks inherent in a particular industry or target business, the Company
cannot assure you that it will properly ascertain or assess all of the significant risk
factors. <font color="#000000">There can be no assurance that any prospective business
combination will benefit shareholders or prove to be more favorable to shareholders than
any other investment that may be made by shareholders and investors.</font></font></p>

<p align="justify"><font size="2" color="#000000"><strong><em>Unspecified and
unascertainable risks</em></strong></font></p>

<p align="justify"><font size="2" color="#000000">There is no basis for shareholders to
evaluate the possible merits or risks of potential business combination or the particular
industry in which the Company may ultimately operate. To the extent that the Company
effects a business combination with a financially unstable operating company or an entity
that is in its early stage of development or growth, including entities without
established records of revenues or income, the Company will become subject to numerous
risks inherent in the business and operations of that financially unstable company. In
addition, to the extent that the Company effects a business combination with an entity in
an industry characterized by a high degree of risk, the Company will become subject to the
currently unascertainable risks of that industry. An extremely high level of risk
frequently characterizes certain industries that experience rapid growth. Although
Management will endeavor to evaluate the risks inherent in a particular business or
industry, there can be no assurance that Management will properly ascertain or assess all
such risks or that subsequent events may not alter the risks that the Company perceived at
the time of the consummation of a business combination.</font></p>

<p align="justify"><strong><font size="2"><em>It is likely that the Company's current
officer and director will resign upon consummation of a business combination and the
Company will have only limited ability to evaluate the management of the target business.</em></font></strong></p>

<p align="justify"><font size="2">The Company's ability to successfully effect a business
combination will be dependent upon the efforts of the Company's Management. The future
role of the Company's key personnel in the target business, however, cannot presently be
ascertained. Although it is possible that Management will remain associated in various
capacities with the target business following a business combination, it is likely that
the management of the target business at the time of the business combination will remain
in place. Although the Company intends to closely scrutinize the management of a
prospective target business in connection with evaluating the desirability of effecting a
business combination, the Company cannot assure you that the Company's assessment of
management will prove to be correct.</font></p>

<p align="justify"><font size="2" color="#000000"><strong><em>Dependence on key personnel</em></strong></font></p>

<p align="justify"><font size="2" color="#000000">The Company is dependent upon the
continued services of its officer and director. To the extent that his services become
unavailable, the Company will be required to obtain other qualified personnel and there
can be no assurance that it will be able to recruit and hire qualified persons upon
acceptable terms.</font></p>

<p align="justify"><strong><font size="2"><em>The Company's officer and director may
allocate his time to other businesses thereby causing conflicts of interest in their
determination as to how much time to devote to the Company's affairs. This could have a
negative impact on the Company's ability to consummate a business combination.</em></font></strong></p>

<p align="justify"><font size="2">The Company's officer and director is not required to
commit his full time to the Company's affairs, which may result in a conflict of interest
in allocating his time between the Company's business and other businesses. The Company
does not intend to have any full time employees prior to the consummation of a business
combination. Management of the Company is engaged in several other business endeavors and
is not obligated to contribute any specific number of his hours per week to the Company's
affairs. If Management's other business affairs require him to devote more substantial
amounts of time to such affairs, it could limit his ability to devote time to the
Company's affairs and could have a negative impact on the Company's ability to consummate
a business combination.</font></p>

<p align="justify"><strong><font size="2"><em>The Company's officer and director is now,
and may in the future become, affiliated with entities engaged in business activities
similar to those intended to be conducted by this Company and, accordingly, may have
conflicts of interest in determining which entity a particular business opportunity should
be presented to.</em></font></strong></p>

<p align="justify"><font size="2">The Company's officer and director is now, and may in
the future become, affiliated with entities, including other companies, engaged in
business activities similar to those intended to be conducted by this Company.
Additionally, the Company's office and director may become aware of business opportunities
which may be appropriate for presentation to this Company as well as the other entities
with which he is or may be affiliated. Additionally, due to the Company's officer and
director existing affiliations with other entities, he may have a fiduciary obligation to
present potential business opportunities to those entities in addition to presenting them
to us which could cause additional conflicts of interest. Accordingly, Management may have
conflicts of interest in determining to which entity a particular business opportunity
should be presented.</font></p>

<p align="justify"><strong><font size="2"><em>It is probable that the Company will only be
able to enter into one business combination, which will cause us to be solely dependent on
such single business and a limited number of products or services.</em></font></strong></p>

<p align="justify"><font size="2">It is probable that the Company will enter into a
business combination with a single operating business. Accordingly, the prospects for the
Company's success may be:</font></p>

<p align="justify"><font size="2" FACE="wingdings">&#159;</font><font size="2"> solely
dependent upon the performance of a single operating business, or<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> dependent upon the
development or market acceptance of a single or limited number of products or services.</font></p>

<p align="justify"><font size="2">In this case, the Company will not be able to diversify
the Company's operations or benefit from the possible spreading of risks or offsetting of
losses, unlike other entities which may have the resources to complete several business
combinations in different industries or different areas of a single industry.</font></p>

<p align="justify"><strong><font size="2"><em>The Company has limited resources and there
is significant competition for business combination opportunities. Therefore, the Company
may not be able to enter into or consummate an attractive business combination.</em></font></strong></p>

<p align="justify"><font size="2">The Company expects to encounter intense competition
from other entities having a business objective similar to the Company's, including
venture capital funds, leveraged buyout funds and operating businesses competing for
acquisitions. Many of these entities are well established and have extensive experience in
identifying and effecting business combinations directly or through affiliates. Many of
these competitors possess greater technical, human and other resources than the Company
does and the Company's financial resources are limited when contrasted with those of many
of these competitors. While the Company believes that there are numerous potential target
businesses that it could acquire, the Company's ability to compete in acquiring certain
sizable target businesses will be limited by the Company's limited financial resources and
the fact that the Company will use its common stock to acquire an operating business. This
inherent competitive limitation gives others an advantage in pursuing the acquisition of
certain target businesses.</font></p>

<p align="justify"><strong><font size="2"><em>The Company may be unable to obtain
additional financing, if required, to complete a business combination or to fund the
operations and growth of the target business, which could compel the Company to
restructure a potential business transaction or abandon a particular business combination.</em></font></strong></p>

<p align="justify"><font size="2">The Company has not yet identified any prospective
target business. If we require funds, because of the size of the business combination, we
will be required to seek additional financing. We cannot assure you that such financing
would be available on acceptable terms, if at all. To the extent that additional financing
proves to be unavailable when needed to consummate a particular business combination, we
would be compelled to restructure the transaction or abandon that particular business
combination and seek an alternative target business candidate. In addition, if we
consummate a business combination, we may require additional financing to fund the
operations or growth of the target business. The failure to secure additional financing
could have a material adverse effect on the continued development or growth of the target
business. The Company's officer, director or stockholders are not required to provide any
financing to us in connection with or after a business combination.</font></p>

<p align="justify"><font size="2" color="#000000"><em><strong>Additional financing
requirements associated with reporting obligations under the Exchange Act</strong></em></font></p>

<p align="justify"><font size="2" color="#000000">The Company has no revenues and is
dependent upon the willingness of the Company's Management to fund the costs associated
with the reporting obligations under the Exchange Act, other&nbsp;administrative costs
associated with the Company's corporate existence and expenses related to the Company's
business objective. The Company is not likely to generate any revenues until the
consummation of a business combination. The Company anticipates that it will have
available sufficient financial resources to continue to pay accounting and other
professional fees and other miscellaneous expenses that may be required until the Company
commence business operations in connection with a business combination. In the event that
the Company's available financial resources from its Management prove to be insufficient
for the purpose of achieving its business objective through a business combination, the
Company will be required to seek additional financing. The Company's failure to secure
additional financing could have a material adverse affect on the Company's ability to
pursue a business combination. The Company does not have any arrangements with any bank or
financial institution to secure additional financing and there can be no assurance that
any such arrangement would be available on terms acceptable and in the Company's best
interests. The Company does not have any written agreement with Management to provide
funds for the Company's operating expenses.</font></p>

<p align="justify"><strong><font size="2"><em>The Company's officer and director has a
69.51% equity interest in the Company and thus may influence certain actions requiring
stockholder vote.</em></font></strong></p>

<p align="justify"><font size="2">It is unlikely that there will be an annual meeting of
stockholders to elect new directors prior to the consummation of a business combination,
in which case the current director will continue in office at least until the consummation
of the business combination. If there is an annual meeting, as a consequence of
Management's significant equity interest, the Company's Management has broad discretion
regarding proposals submitted to a vote by shareholders. Accordingly, the Company's
existing board of director will continue to exert substantial control at least until the
consummation of a business combination.</font></p>

<p align="justify"><strong><font size="2"><em>Broad discretion of Management</em></font></strong></p>

<p align="justify"><font size="2">Any person who invests in the Company's common stock
will do so without an opportunity to evaluate the specific merits or risks of any
prospective business combination. As a result, investors will be entirely dependent on the
broad discretion and judgment of Management in connection with the selection of a
prospective business combination. There can be no assurance that determinations made by
the Company's Management will permit us to achieve the Company's business objectives.</font></p>

<p align="justify" style="text-align: justify"><strong><em><font size="2" color="#000000">Reporting
requirements may delay or preclude a business combination</font></em></strong></p>

<p align="justify" style="text-align: justify"><font size="2" color="#000000">Pursuant to
the requirements of Section 13 of the Exchange Act, the Company is required to provide
certain information about significant acquisitions and other material events. The Company
will continue to be required to file quarterly reports on Form 10-QSB and annual reports
on Form 10-KSB, which annual report must contain the Company's audited financial
statements. As a reporting company under the Exchange Act, following any business
combination, we will be required to file a report on Form 8-K, which report contains
audited financial statements of the acquired entity. These audited financial statements
must be filed with the SEC within 4 days following the filing of Form 8-K disclosing the
transaction. While obtaining audited financial statements is typically the responsibility
of the acquired company, it is possible that a potential target company may be a
non-reporting company with unaudited financial statements. The time and costs that may be
incurred by some potential target companies to prepare such audited financial statements
may significantly delay or may even preclude consummation of an otherwise desirable
business combination. Acquisition prospects that do not have or are unable to obtain the
required audited statements may not be appropriate for acquisition because we are subject
to the reporting requirements of the Exchange Act.</font></p>

<p align="justify"><strong><font size="2"><em>If the Company is deemed to be an investment
company, the Company may be required to institute burdensome compliance requirements and
the Company's activities may be restricted, which may make it difficult for the Company to
enter into a business combination.</em></font></strong></p>

<p align="justify"><font size="2" FACE="wingdings">&#159;</font><font size="2">
restrictions on the nature of the Company's investments; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> restrictions on the
issuance of securities, which may make it difficult for us to complete a business
combination.</font></p>

<p align="justify"><font size="2">In addition, we may have imposed upon us burdensome
requirements, including:<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> registration as an
investment company;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> adoption of a specific
form of corporate structure; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> reporting, record
keeping, voting, proxy and disclosure requirements and other rules and regulations.</font></p>

<p align="justify"><font size="2">The Company does not believe that its anticipated
principal activities will subject it to the Investment Company Act of 1940.</font></p>

<p align="justify"><strong><font size="2"><em>The Company may be deemed to have no
&quot;Independent Director&quot;, actions taken and expenses incurred by our officers and
directors on behalf of the Company will generally not be subject to &quot;Independent
Review&quot;.</em></font></strong></p>

<p align="justify"><font size="2">Our director owns shares of our common stock and,
although no compensation will be paid to him for services rendered prior to or in
connection with a business combination, he may receive reimbursement for out-of-pocket
expenses incurred by him in connection with activities on the Company's behalf such as
identifying potential target businesses and performing due diligence on suitable business
combinations. There is no limit on the amount of these out-of-pocket expenses and there
will be no review of the reasonableness of the expenses by anyone other than our board of
director, which consist of the one director who may seek reimbursement. If our sole
director will not be deemed &quot;independent,&quot; he will generally not have the
benefit of independent director examining the propriety of expenses incurred on our behalf
and subject to reimbursement. Although the Company believes that all actions taken by our
director on the Company's behalf will be in the Company's best interests, the Company
cannot assure the investor that this will actually be the case. If actions are taken, or
expenses are incurred that are actually not in the Company's best interests, it could have
a material adverse effect on our business and plan of operation and the price of our stock
held by the public stockholders.</font></p>

<p style="text-align: justify"><font size="2" color="#000000"><strong><em>General Economic
Risks.</em></strong></font></p>

<p style="text-align: justify"><font size="2" color="#000000">The Company's current and
future business objectives and plan of operation are likely dependent, in large part, on
the state of the general economy. Adverse changes in economic conditions may adversely
affect the Company's business objective and plan of operation. These conditions and other
factors beyond the Company's control include also, but are not limited to regulatory
changes.</font></p>

<p align="center"><strong><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">RISKS RELATED TO
OUR COMMON STOCK</font></strong></p>

<p align="left"><strong><em><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our historic stock
price has been volatile and the future market price for our common stock is likely to
continue to be volatile. Further, the limited market for our shares will make our price
more volatile. This may make it difficult for you to sell our common stock.</font></em></strong></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The public market
for our common stock has been very volatile. Over the past two fiscal years and subsequent
quarterly periods, the market price for our common stock has ranged from $0.30 to $0.0001
(See &quot;Market for Common Equity and Related Stockholder Matters&#148; on page 13 of
this Prospectus). Any future market price for our shares is likely to continue to be very
volatile. This price volatility may make it more difficult for you to sell shares when you
want at prices you find attractive. Further, the market for our common stock is limited
and we cannot assure you that a larger market will ever be developed or maintained. The
last reported sales price for our common stock on May 11, 2006 was $0.015 per share.
Market fluctuations and volatility, as well as general economic, market and political
conditions, could reduce our market price. As a result, this may make it difficult or
impossible for you to sell our common stock.</font></p>

<p align="justify"><strong><font size="2"><em>The Company's shares of common stock are
quoted on the NASD Bulletin Board, which limits the liquidity and price of the Company's
common stock.</em></font></strong></p>

<p align="justify"><font size="2">The Company's shares of common stock are traded on the
NASD Bulletin Board, an NASD-sponsored and operated inter-dealer automated quotation
system for equity securities not included on The Nasdaq Stock Market. Quotation of the
Company's securities on the NASD Bulletin Board limits the liquidity and price of the
Company's common stock more than if the Company's shares of common stock were listed on
The Nasdaq Stock Market or a national exchange. <font color="#000000">There is currently
no active trading market in the Company's common stock. There can be no assurance that
there will be an active trading market for the Company's common stock following a business
combination. In the event that an active trading market commences, there can be no
assurance as to the market price of the Company's shares of common stock, whether any
trading market will provide liquidity to investors, or whether any trading market will be
sustained.</font></font></p>

<p align="left"><em><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Our common
stock is subject to the Penny Stock Rules of the SEC and the trading market in our common
stock is limited, which makes transactions in our stock cumbersome and may reduce the
value of an investment in our common stock.</strong></font></em></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Securities and
Exchange Commission has adopted Rule 3a51-1 which establishes the definition of a
&quot;penny stock,&quot; for the purposes relevant to us, as any equity security that has
a market price of less than $5.00 per share or with an exercise price of less than $5.00
per share, subject to certain exceptions. For any transaction involving a penny stock,
unless exempt, Rule 15g-9 require: <br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">that a broker or
dealer approve a person's account for transactions in penny stocks; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">the broker or
dealer receive from the investor a written agreement to the transaction, setting forth the
identity and quantity of the penny stock to be purchased.</font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In order to approve
a person&#146;s account for transactions in penny stocks, the broker or dealer must:<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">obtain financial
information and investment experience objectives of the person; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">make a reasonable
determination that the transactions in penny stocks are suitable for that person and the
person has sufficient knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The broker or
dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule
prescribed by the SEC relating to the penny stock market, which, in highlight form:<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">sets forth the
basis on which the broker or dealer made the suitability determination; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">that the broker or
dealer received a signed, written agreement from the investor prior to the transaction.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Generally, brokers
may be less willing to execute transactions in securities subject to the &quot;penny
stock&quot; rules. This may make it more difficult for investors to dispose of our common
stock and cause a decline in the market value of our stock. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Disclosure also has
to be made about the risks of investing in penny stocks in both public offerings and in
secondary trading and about the commissions payable to both the broker-dealer and the
registered representative, current quotations for the securities and the rights and
remedies available to an investor in cases of fraud in penny stock transactions. Finally,
monthly statements have to be sent disclosing recent price information for the penny stock
held in the account and information on the limited market in penny stocks. </font></p>

<p style="text-align: justify"><strong><font size="2" color="#000000"><em>State blue sky
registration; potential limitations on resale of the Company's common stock</em></font></strong></p>

<p style="text-align: justify"><font size="2" color="#000000">The holders of the Company's
shares of common stock registered under the Exchange Act and those persons who desire to
purchase them in any trading market that may develop in the future, should be aware that
there may be state blue-sky law restrictions upon the ability of investors to resell the
Company's securities. Accordingly, investors should consider the secondary market for the
Registrant's securities to be a limited one.</font></p>

<p align="justify" style="text-align: justify"><font size="2" color="#000000">It is the
intention of the Registrant's Management following the consummation of a business
combination to seek coverage and publication of information regarding the Registrant in an
accepted publication manual which permits a manual exemption. The manual exemption permits
a security to be distributed in a particular state without being registered if the
Registrant issuing the security has a listing for that security in a securities manual
recognized by the state. However, it is not enough for the security to be listed in a
recognized manual. The listing entry must contain (1) the names of issuers, officers, and
directors, (2) an issuer's balance sheet, and (3) a profit and loss statement for either
the fiscal year preceding the balance sheet or for the most recent fiscal year of
operations. Furthermore, the manual exemption is a nonissuer exemption restricted to
secondary trading transactions, making it unavailable for issuers selling newly issued
securities.</font></p>

<p style="text-align: justify"><font size="2" color="#000000">Most of the accepted manuals
are those published by Standard and Poor's, Moody's Investor Service, Fitch's Investment
Service, and Best's Insurance Reports, and many states expressly recognize these manuals.
A smaller number of states declare that they &quot;recognize securities manuals&quot; but
do not specify the recognized manuals. The following states do not have any provisions and
therefore do not expressly recognize the manual exemption: Alabama, Georgia, Illinois,
Kentucky, Louisiana, Montana, South Dakota, Tennessee, Vermont and Wisconsin. </font></p>

<p style="text-align: justify"><strong><font size="2" color="#000000"><em>Dividends
unlikely</em></font></strong></p>

<p style="text-align: justify"><font size="2" color="#000000">The Company does not expect
to pay dividends for the foreseeable future because it has no revenues or cash resources.
The payment of dividends will be contingent upon the Company's future revenues and
earnings, if any, capital requirements and overall financial conditions. The payment of
any future dividends will be within the discretion of the Company's board of directors as
then constituted. It is the Company's expectation that future management following a
business combination will determine to retain any earnings for use in its business
operations and accordingly, the Company does not anticipate declaring any dividends in the
foreseeable future.</font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><a name="USE OF PROCEEDS"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>USE OF
PROCEEDS </strong></font></a><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">This prospectus
relates to shares of our common stock that may be offered and sold from time to time by
the selling stockholders. We will not receive any proceeds from the sale of shares of
common stock in this offering.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="SELLING STOCKHOLDERS">SELLING STOCKHOLDERS</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following table
sets forth the common stock ownership and other information relating to the selling
stockholders as of March 31, 2006. The selling stockholders acquired their shares through
private transactions with the Registrant pursuant to an exemption provided under Section
(4)2 of the Act and as compensation for consulting services provided.</font></p>
<div align="left">

<table cellpadding="0" cellspacing="0" width="100%" height="47">
  <tr>
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0" valign="middle">&nbsp; </td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><font
    style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1"><strong>Number of Shares
    Beneficially</strong></font></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><font
    size="1"><strong>Number of Shares Offered</strong></font></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="32%" style="BORDER-BOTTOM: #ffffff" height="0"
    colspan="3"><p align="center"><font style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1"><strong>Shares Beneficially Owned After the Offering (1) </strong></font></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ffffff" height="0"><font
    style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1"><strong>Name</strong></font></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0" valign="middle"></td>
    <td align="right" valign="middle" width="20%" style="border-bottom: 2px solid rgb(0,0,0)"
    height="0"><font style="FONT-SIZE: 8pt" size="1"><strong>Owned Prior to the Offering</strong></font></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="20%" style="border-bottom: 2px solid rgb(0,0,0)"
    height="0"><font size="1"><strong>Pursuant to this Prospectus</strong></font></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="15%" style="border-bottom: 2px solid rgb(0,0,0)"
    height="0"><font style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1"><strong>Number</strong></font></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="15%" style="border-bottom: 2px solid rgb(0,0,0)"
    height="0"><font style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1"><strong>Percent</strong></font></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    size="2">Ivo Heiden (2)</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0" valign="middle"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">64,600,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">64,600,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0.00%</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    size="2">Juergen Heiden (3)</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ccffcc" height="0" valign="middle"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">7,200,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">7,200,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0.00%</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    size="2">Richard Rubin</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0" valign="middle"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">4,600,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">4,600,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0.00%</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="22%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    size="2">Total</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ccffcc" height="0" valign="middle"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">76,400,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="20%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">76,400,000</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="2%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="right" valign="middle" width="14%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">0.00%</font></font></p>
    </div></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="99%" style="BORDER-BOTTOM: #ccffcc" height="0"
    colspan="9"><font size="1">(1) </font><font style="Times New Roman" size="1">Assumes that
    all securities registered will be sold.</font></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="99%" style="BORDER-BOTTOM: #ccffcc" height="0"
    colspan="9"><font size="1">(2) Selling stockholder is the sole officer and director of the
    Company.</font></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="99%" style="BORDER-BOTTOM: #ccffcc" height="0"
    colspan="9"><font size="1">(3) Mr. Juergen Heiden is the father of the Company's sole
    officer and director.</font></td>
  </tr>
</table>
</div>

<p align="center"><strong><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><a
name="PLAN OF DISTRIBUTION">PLAN OF DISTRIBUTION</a> </font></strong><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The selling
stockholders and any of their respective pledgees, donees, assignees and other
successors-in-interest may, from time to time, sell any or all of their shares of common
stock on any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These sales may be at fixed or negotiated prices. The selling
stockholders may use any one or more of the following methods when selling shares:</font></p>

<p align="left"><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">ordinary brokerage
transactions and transactions in which the broker-dealer solicits the purchaser; <br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">block trades in
which the broker-dealer will attempt to sell the shares as agent but may position and
resell a portion of the block as principal to facilitate the transaction;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">purchases by a
broker-dealer as principal and resale by the broker-dealer for its account;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">an exchange
distribution in accordance with the rules of the applicable exchange;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">privately-negotiated
transactions;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">broker-dealers may
agree with the selling stockholders to sell a specified number of such shares at a
stipulated price per share;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">through the writing
of options on the shares;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a combination of
any such methods of sale; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> </font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">any other method
permitted pursuant to applicable law. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The selling
stockholders may also sell shares under Rule 144 of the Securities Act, if available,
rather than under this prospectus. The selling stockholders shall have the sole and
absolute discretion not to accept any purchase offer or make any sale of shares if it
deems the purchase price to be unsatisfactory at any particular time.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The selling
stockholders or their respective pledgees, donees, transferees or other successors in
interest, may also sell the shares directly to market makers acting as principals and/or
broker-dealers acting as agents for themselves or their customers. Such broker-dealers may
receive compensation in the form of discounts, concessions or commissions from the selling
stockholders and/or the purchasers of shares for whom such broker-dealers may act as
agents or to whom they sell as principal or both, which compensation as to a particular
broker-dealer might be in excess of customary commissions. Market makers and block
purchasers purchasing the shares will do so for their own account and at their own risk.
It is possible that a selling stockholder will attempt to sell shares of common stock in
block transactions to market makers or other purchasers at a price per share which may be
below the then existing market price. We cannot assure that all or any of the shares
offered in this prospectus will be issued to, or sold by, the selling stockholders. The
selling stockholders and any brokers, dealers or agents, upon effecting the sale of any of
the shares offered in this prospectus, may be deemed to be &quot;underwriters&quot; as
that term is defined under the Securities Exchange Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, and the rules and regulations of such acts. In such
event, any commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have agreed to
pay all fees and expenses incident to the registration of the shares, including fees and
disbursements of counsel to the selling stockholders, but excluding brokerage commissions
or underwriter discounts.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The selling
stockholders, alternatively, may sell all or any part of the shares offered in this
prospectus through an underwriter. The selling stockholders have not entered into any
agreement with a prospective underwriter and there is no assurance that any such agreement
will be entered into. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The selling
stockholders may pledge their shares to their brokers under the margin provisions of
customer agreements. If a selling stockholder defaults on a margin loan, the broker may,
from time to time, offer and sell the pledged shares. The selling stockholders and any
other persons participating in the sale or distribution of the shares will be subject to
applicable provisions of the Securities Exchange Act of 1934, as amended, and the rules
and regulations under such Act, including, without limitation, Regulation M. These
provisions may restrict certain activities of, and limit the timing of purchases and sales
of any of the shares by, the selling stockholders or any other such person. In the event
that any of the selling stockholders are deemed an affiliated purchaser or distribution
participant within the meaning of Regulation M, then the selling stockholders will not be
permitted to engage in short sales of common stock. Furthermore, under Regulation M,
persons engaged in a distribution of securities are prohibited from simultaneously
engaging in market making and certain other activities with respect to such securities for
a specified period of time prior to the commencement of such distributions, subject to
specified exceptions or exemptions. In addition, if a short sale is deemed to be a
stabilizing activity, then the selling stockholders will not be permitted to engage in a
short sale of our common stock. All of these limitations may affect the marketability of
the shares. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">If a selling
stockholder notifies us that it has a material arrangement with a broker-dealer for the
resale of the common stock, then we would be required to amend the registration statement
of which this prospectus is a part, and file a prospectus supplement to describe the
agreements between the selling stockholder and the broker-dealer.</font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><font style="Times New Roman" size="2"><strong><a
name="MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS">MARKET FOR COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS</a> </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Market
Information</strong></font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our common stock is
currently quoted on the NASD Bulletin Board under the symbol ZAXS, an NASD-sponsored and
operated inter-dealer automated quotation system for equity securities not included on The
Nasdaq Stock Market. Quotation of the Company's securities on the NASD Bulletin Board
limits the liquidity and price of the Company's common stock more than if the Company's
shares of common stock were listed on The Nasdaq Stock Market or a national exchange. For
the periods indicated, the following table sets forth the high and low bid prices per
share of common stock as reported by the NASD Bulletin Board. The below prices represent
inter-dealer quotations without retail markup, markdown, or commission and may not
necessarily represent actual transactions.</font></p>

<table cellpadding="0" cellspacing="0" width="100%" height="0">
  <tr>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff solid"
    height="26"></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff solid" valign="middle" height="26"></td>
    <td colspan="5" valign="middle" width="0%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Fiscal
    2006</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td colspan="5" valign="middle" width="0%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Fiscal
    2005</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td colspan="5" valign="middle" width="0%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Fiscal
    2004</strong></font></font></p>
    </div></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff solid"
    height="26"></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff solid" valign="middle" height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>High</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Low</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>High</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Low</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>High</strong></font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #000000 thin solid"
    height="26"></td>
    <td align="left" colspan="2" valign="middle" width="0%"
    style="BORDER-BOTTOM: #000000 thin solid" height="26"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="1"><strong>Low</strong></font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">First Quarter ended March 31</font></font></p>
    </div></td>
    <td width="0%" style="BORDER-BOTTOM: #ccffcc" valign="middle" height="0"></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.04</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.01</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p></font>&nbsp;</p>
    </div></td>
    <td align="left" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="32%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">Second Quarter ended June 30</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" valign="middle" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p></font>&nbsp;</p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="32%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">Third Quarter ended September 30</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ccffcc" valign="middle" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="0%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ccffcc" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="32%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">Fourth Quarter ended December 31</font></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" valign="middle" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><font
    face="Times New Roman" size="2">$</font></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><font
    face="Times New Roman" size="2">$</font></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">---</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.30</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.02</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="9%" style="BORDER-BOTTOM: #ffffff" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font
    face="Times New Roman" size="2">0.0001</font></font></p>
    </div></td>
  </tr>
</table>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of March 31,
2006, our shares of common stock were held by approximately 2,517 stockholders of record.
The transfer agent of our common stock is Standard Registrar and Transfer Company, Inc. </font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Dividends</strong></font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Holders of common
stock are entitled to dividends when, as, and if declared by the Board of Directors, out
of funds legally available therefore. We have never declared cash dividends on its common
stock and our Board of Directors does not anticipate paying cash dividends in the
foreseeable future as it intends to retain future earnings to finance the growth of our
businesses. There are no restrictions in our articles of incorporation or bylaws that
restrict us from declaring dividends.</font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Securities
Authorized for Issuance Under Equity Compensation Plans </strong></font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">No equity
compensation plan or agreements under which our common stock is authorized for issuance
has been adopted during the fiscal year ended December 31, 2005.</font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="DESCRIPTION OF BUSINESS">DESCRIPTION OF BUSINESS</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left"><strong><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Organizational
History and General Background of the Registrant</font></strong></p>

<p align="justify" style="text-align: justify"><font size="2">The Registrant was a
biotechnology holding company that operated its business through a wholly owned
subsidiary. Zaxis was incorporated in Ohio in 1989. On August 25, 1995, Zaxis merged with
a subsidiary of The InFerGene Company (&quot;InFerGene&quot;) and InFerGene changed its
name to Zaxis International Inc. For accounting and tax purposes, the merger was treated
as a reverse acquisition. InFerGene and its subsidiary were inactive and had no assets or
liabilities at the time of the merger. InFerGene was incorporated in California in 1984
and subsequently changed its domicile to Delaware in 1985.</font></p>

<p align="justify"><font size="2">Zaxis was a manufacturer and distributor of products
that were used in a molecular separation process known as electrophoresis, a procedure
used in more than 55,000 research, industrial and clinical laboratories worldwide. The
more common applications of this procedure include protein-based separations such as the
HDL and LDL components and sub-components of cholesterol, the identification of various
genes and gene products (e.g. DNA, RNA, etc.) and the separation and identification of
proteins in drug discovery applications (Proteomics). A variety of techniques, formats,
materials, compounds, equipment and devices are employed in electrophoresis and Zaxis
provided products to meet these needs. The primary focus of the Company's former research
and development efforts as well as its former sales and marketing efforts were targeted
toward the consumables segment of this market. The Company's core products were the
pre-cast gels and reagents used in these electrophoresis procedures.</font></p>

<p align="justify"><font size="2">The Company believed that its products were well
positioned to take advantage of rapidly growing markets. The Company was not able to
generate sufficient revenues to support its operating expenses during fiscal year 2002. In
addition, the Company was not able to raise additional capital to fund its negative cash
flow from operations through borrowings or equity financing to support and expand its
business plan. As a result, the Company ceased operations during the fourth quarter in
2002 and filed a voluntary Chapter 7 bankruptcy petition.</font></p>

<p align="justify"><font size="2">On November 6, 2002, the Registrant filed a voluntary
Chapter 7 petition under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court Northern
District of Ohio (case no. 02-55160). </font><font face="Times New Roman" size="2">As a
result of filing under Chapter 7 </font><font size="2" color="#000000">of the US
Bankruptcy Code, all of the Registrant&#146;s assets and liabilities, including those of
its subsidiary, were transferred into the estate of the debtor which estate was
administered by the trustee appointed by the US Bankruptcy Court. </font><font
face="Times New Roman" size="2">During 2003 and 2004, the Bankruptcy Trustee had disposed
of substantially all of the assets of the Registrant and its subsidiary. </font><font
size="2">On October 13, 2004, the Bankruptcy Court approved an Order confirming the sale
of debtor's interest in personal property to Park Avenue Group Inc. and confirming that
Park Avenue Group, Inc. is a good faith purchaser pursuant to 11 USC Section 363(m).</font></p>

<p style="text-align: justify"><font face="Times New Roman" size="2" color="#000000">In
connection with the order of the U.S. Bankruptcy Court dated October 13, 2004, the Court
authorized that Park Avenue Group appoint a new board of directors and authorized the
issuance of restricted shares to the new management of the Registrant. The issuance of
restricted shares to the Registrant's new management effectively resulted in a change in
control of the Registrant. The shareholders of the Registrant prior to the bankruptcy
proceedings remained shareholders of the Registrant subsequent to the emergence of the
Registrant from bankruptcy. The Court order further provided that the Registrant emerged
from bankruptcy free and clear of liens, claims and interests. The court order authorized
(i) that the existing officers and directors were deemed removed from office; (ii) the
appointment of new members to the Registrant's board of directors; (iii) the amendment of
Registrant's Certificate of Incorporation to increase the number of authorized shares to
100,000,000 shares; (iv) the issuance up to 30,000,000 shares of common stock, par value
$0.0001, to the new management of the Registrant, which management was appointed by the
newly-constituted board of directors; (v) the authority of the board of directors to
implement a reverse split of the issued and outstanding shares in a ratio to be determined
by the board of directors; (vi) the cancellation and extinguishment of all common share
conversion rights of any kind, including without limitation, warrants, options,
convertible bonds, other convertible debt instruments and convertible preferred stock; and
(vii) the cancellation and extinguishment of all preferred shares of every series and
accompanying conversion rights of any kind.</font></p>

<p style="text-align: justify"><font face="Times New Roman" size="2" color="#000000">As a
result of the Bankruptcy Court order, Park Avenue Group appointed Ivo Heiden to the board
of directors of the Registrant. Mr. Heiden was subsequently appointed as sole officers of
the Registrant (&quot;Management&quot;).</font></p>

<p align="left"><strong><font color="#000000" face="TIMES NEW ROMAN, TIMES, SERIF"
size="2">Business Objectives of the Registrant</font></strong></p>

<p align="justify"><font color="#000000" face="TIMES NEW ROMAN, TIMES, SERIF" size="2">As
a result of the Chapter 7 bankruptcy proceeding, the Registrant has no present operations.
Management determined to direct its efforts and limited resources to pursue and effect a
business combination.</font></p>

<p align="justify" style="text-align: justify"><font size="2">&nbsp;&nbsp;&nbsp; <em>Current
trends</em></font></p>

<p align="justify" style="text-align: justify"><font size="2">Management believes that as
a result of the relative uncertainty in the United States equity markets over the past few
years, many privately-held companies have been closed off from the public market and
traditional IPO's. During the past few years, many privately-held or public companies
attempted to divest non-core assets and divisions and valuations of these assets and
divisions have decreased significantly. Therefore, Management believes that there are
substantial business opportunities to effect attractive acquisitions. As a public entity
with its shares of common stock registered under the Exchange Act and publicly trading,
Management believes to be well positioned to identify target acquisitions and to effect a
business combination in order to take advantage of these current trends.</font></p>

<p align="justify"><font size="2">&nbsp;&nbsp;&nbsp; <em>Effecting a business combination</em></font></p>

<p align="justify" style="text-align: justify"><font size="2">Prospective investors in the
Company's common stock will invest in the Company without an opportunity to evaluate the
specific merits or risks of any one or more business combinations. A business combination
may involve the acquisition of, or merger with, a company which needs to raise substantial
additional capital by means of being a publicly trading company, while avoiding what it
may deem to be adverse consequences of undertaking a public offering itself. These include
time delays, significant expense, loss of voting control and compliance with various
Federal and state securities laws. A business combination may involve a company which may
be financially unstable or in its early stages of development or growth.</font></p>

<p align="justify" style="text-align: justify"><em>&nbsp;&nbsp;&nbsp; <font size="2">The
Registrant has not identified a target business or target industry</font></em></p>

<p align="justify" style="text-align: justify"><font size="2">The Company's effort in
identifying a prospective target business will not be limited to a particular industry and
the Company may ultimately acquire a business in any industry Management deems
appropriate. To date, the Company has not selected any target business on which to
concentrate our search for a business combination. While the Company intends to focus on
target businesses in the United States, it is not limited to those entities and may
consummate a business combination with a target business outside of the United States.
Accordingly, there is no basis for investors in the Company's common stock to evaluate the
possible merits or risks of the target business or the particular industry in which the
Company may ultimately operate. To the extent the Company effects a business combination
with a financially unstable company or an entity in its early stage of development or
growth, including entities without established records of sales or earnings, the Company
may be affected by numerous risks inherent in the business and operations of financially
unstable and early stage or potential emerging growth companies. In addition, to the
extent that we effect a business combination with an entity in an industry characterized
by a high level of risk, we may be affected by the currently unascertainable risks of that
industry. An extremely high level of risk frequently characterizes many industries which
experience rapid growth. In addition, although the Company's Management will endeavor to
evaluate the risks inherent in a particular industry or target business, we cannot assure
you that we will properly ascertain or assess all significant risk factors.</font></p>

<p align="justify" style="text-align: justify">&nbsp;&nbsp;&nbsp; <em><font size="2">Sources
of target businesses</font></em></p>

<p align="justify" style="text-align: justify"><font size="2">The Registrant anticipates
that target business candidates will be brought to our attention from various unaffiliated
sources, including securities broker-dealers, investment bankers, venture capitalists,
bankers and other members of the financial community, who may present solicited or
unsolicited proposals. Our Management may also bring to our attention target business
candidates. While we do not presently anticipate engaging the services of professional
firms that specialize in business acquisitions on any formal basis, we may engage these
firms in the future, in which event we may pay a finder's fee or other compensation. In no
event, however, will we pay Management any finder's fee or other compensation for services
rendered to us prior to or in connection with the consummation of a business combination.</font></p>

<p align="justify" style="text-align: justify">&nbsp;&nbsp;&nbsp; <em><font size="2">Selection
of a target business and structuring of a business combination</font></em></p>

<p align="justify" style="text-align: justify"><font size="2">Management owns 69.51% of
the issued and outstanding shares and will have broad flexibility in identifying and
selecting a prospective target business. In evaluating a prospective target business, our
Management will consider, among other factors, the following:</font></p>

<p align="justify" style="text-align: justify"><font size="2" FACE="wingdings">&#159;</font><font
size="2"> financial condition and results of operation of the target company;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> growth potential;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> experience and skill
of management and availability of additional personnel;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> capital requirements;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> competitive position;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> stage of development
of the products, processes or services;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> degree of current or
potential market acceptance of the products, processes or services;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> proprietary features
and degree of intellectual property or other protection of the products, processes or
services;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> regulatory environment
of the industry; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> costs associated with
effecting the business combination.</font></p>

<p align="justify" style="text-align: justify"><font size="2">These criteria are not
intended to be exhaustive. Any evaluation relating to the merits of a particular business
combination will be based, to the extent relevant, on the above factors as well as other
considerations deemed relevant by our Management in effecting a business combination
consistent with our business objective. In evaluating a prospective target business, we
will conduct a due diligence review which will encompass, among other things, meetings
with incumbent management and inspection of facilities, as well as review of financial and
other information which will be made available to us.</font></p>

<p align="justify" style="text-align: justify"><font size="2">We will endeavor to
structure a business combination so as to achieve the most favorable tax treatment to us,
the target business and both companies' stockholders. We cannot assure you, however, that
the Internal Revenue Service or appropriate state tax authority will agree with our tax
treatment of the business combination. The time and costs required to select and evaluate
a target business and to structure and complete the business combination cannot presently
be ascertained with any degree of certainty. Any costs incurred with respect to the
identification and evaluation of a prospective target business with which a business
combination is not ultimately completed will result in a loss to us.</font></p>

<p align="justify" style="text-align: justify">&nbsp;&nbsp;&nbsp; <em><font size="2">Probable
lack of business diversification</font></em></p>

<p align="justify" style="text-align: justify"><font size="2">We may seek to effect
business combinations with more than one target business, it is probable that we will have
the ability to effect only a single business combination. Accordingly, the prospects for
our success may be entirely dependent upon the future performance of a single business.
Unlike other entities which may have the resources to complete several business
combinations of entities operating in multiple industries or multiple areas of a single
industry, it is probable that we will not have the resources to diversify our operations
or benefit from the possible spreading of risks or offsetting of losses. By consummating a
business combination with only a single entity, our lack of diversification may:</font></p>

<p align="justify" style="text-align: justify"><font size="2" FACE="wingdings">&#159;</font><font
size="2"> subject us to numerous economic, competitive and regulatory developments, any or
all of which may have a substantial adverse impact upon the particular industry in which
we may operate subsequent to a business combination, and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> result in our
dependency upon the development or market acceptance of a single or limited number of
products, processes or services.</font></p>

<p align="justify" style="text-align: justify">&nbsp;&nbsp; <em><font size="2">Limited
ability to evaluate the target business' management</font></em></p>

<p align="justify" style="text-align: justify"><font size="2">Although we intend to
closely scrutinize the management of a prospective target business when evaluating the
desirability of effecting a business combination, we cannot assure you that our assessment
of the target business' management will prove to be correct. In addition, we cannot assure
you that the future management will have the necessary skills, qualifications or abilities
to manage a public company intending to embark on a program of business development.
Furthermore, the future role of our director, if any, in the target business cannot
presently be stated with any certainty. While it is possible that our director will remain
associated in some capacity with us following a business combination, it is unlikely that
he will devote his full efforts to our affairs subsequent to a business combination.
Moreover, we cannot assure you that our director will have significant experience or
knowledge relating to the operations of the particular target business. </font></p>

<p align="justify" style="text-align: justify"><font size="2">Following a business
combination, we may seek to recruit additional managers to supplement the incumbent
management of the target business. We cannot assure you that we will have the ability to
recruit additional managers, or that additional managers will have the requisite skills,
knowledge or experience necessary to enhance the incumbent management. </font></p>

<p align="justify" style="text-align: justify"><u><font size="2">Competition</font></u></p>

<p align="justify" style="text-align: justify"><font size="2">In identifying, evaluating
and selecting a target business, we expect to encounter intense competition from other
entities having a business objective similar to ours. Many of these entities are well
established and have extensive experience identifying and effecting business combinations
directly or through affiliates. Many of these competitors possess greater technical, human
and other resources than us and our financial resources will be relatively limited when
contrasted with those of many of these competitors. While we believe there are numerous
potential target businesses, our ability to compete in acquiring certain sizable target
businesses will be limited by our limited financial resources. This inherent competitive
limitation gives others an advantage in pursuing the acquisition of a target business.
Further, any of these obligations may place us at a competitive disadvantage in
successfully negotiating a business combination. Our Management believes, however, that
our status as a public entity and potential access to the United States public equity
markets may give us a competitive advantage over privately-held entities having a similar
business objective in acquiring a target business with significant growth potential on
favorable terms.</font></p>

<p align="justify" style="text-align: justify"><font size="2">If we succeed in effecting a
business combination, there will be, in all likelihood, intense competition from
competitors of the target business. In particular, certain industries which experience
rapid growth frequently attract an increasingly larger number of competitors, including
competitors with increasingly greater financial, marketing, technical and other resources
than the initial competitors in the industry. The degree of competition characterizing the
industry of any prospective target business cannot presently be ascertained. We cannot
assure you that, subsequent to a business combination, we will have the resources to
compete effectively, especially to the extent that the target business is in a high-growth
industry.</font></p>

<p align="justify" style="text-align: justify"><font size="2"><u>Employees</u></font></p>

<p align="justify" style="text-align: justify"><font size="2">Mr. Heiden, our President
and CFO, is our sole executive officer. </font><font face="Times New Roman" size="2"
color="#000000">Mr. Heiden </font><font size="2">is not obligated to contribute any
specific number of hours per week and intend to devote only as much time as he deem
necessary to the Company's affairs. The amount of time he will devote in any time period
will vary based on the availability of suitable target businesses to investigate. We do
not intend to have any full time employees prior to the consummation of a business
combination.</font></p>

<p align="justify"><font size="2" color="#000000"><u>Conflicts of Interest</u></font></p>

<p align="justify"><font size="2" color="#000000">The Company's Management is not required
to commit its full time to the Company's affairs. As a result, pursuing new business
opportunities may require a greater period of time than if Management would devote his
full time to the Company's affairs. Management is not precluded from serving as officer or
director of any other entity that is engaged in business activities similar to those of
the Registrant. Management has not identified and is not currently negotiating a new
business opportunity for us. In the future, Management may become associated or affiliated
with entities engaged in business activities similar to those we intend to conduct. In
such event, Management may have conflicts of interest in determining to which entity a
particular business opportunity should be presented. In the event that the Company's
Management has multiple business affiliations, it may have legal obligations to present
certain business opportunities to multiple entities. In the event that a conflict of
interest shall arise, Management will consider factors such as reporting status,
availability of audited financial statements, current capitalization and the laws of
jurisdictions. If several business opportunities or operating entities approach Management
with respect to a business combination, Management will consider the foregoing factors as
well as the preferences of the Management of the operating company. However, Management
will act in what it believes will be in the best interests of the shareholders of the
Registrant. The Registrant shall not enter into a transaction with a target business that
is affiliated with Management.</font></p>

<p ALIGN="JUSTIFY"><font size="2" color="#000000"><u>Business Experience of Management</u></font></p>

<p ALIGN="JUSTIFY"><font face="Times New Roman" size="2" color="#000000">Mr. Heiden</font><font
size="2"><font color="#000000">, the Company's sole officer and director has experiences </font>in
executing a business plan similar to our business plan and <font color="#000000">in
negotiating business combinations involving several different privately-held operating
companies. In connection with or upon completion of such transactions, </font></font><font
face="Times New Roman" size="2" color="#000000">Mr. </font><font size="2"><font
color="#000000">Heiden resigned his management position. </font>Information with respect
to each business combination and Management's role, if any, with each such company
following the business combination is set forth below:</font></p>

<p ALIGN="JUSTIFY"><font size="2" color="#000000">Fifth Avenue Acquisition I Corp. -
Merger in August 2001 between Fifth Avenue Acquisition I Corp. with PlanetLink
Communications, Inc., a privately-held operating company. PlanetLink Communications, Inc.
became the successor reporting company and&nbsp;is subject to quotation on the NASD
bulletin board. Mr. Heiden an officer and a directors of Fifth Avenue Acquisition I Corp.
resigned as officer and director following the merger with PlanetLink.</font></p>

<p ALIGN="JUSTIFY"><font size="2" color="#000000">Western Silver-Lead Corporation - &nbsp;
Merger in September 2003 between Western-Silver Lead Corp. and Jeantex Group, Inc.
(formerly Lexor Holdings Inc.), a privately-held operating company. Lexor became the
successor reporting company and is subject to quotation on the NASD bulletin board. Mr.
Heiden, an officer and a director of Western Silver-Lead Corporation resigned as officer
and director following the merger with Lexor.</font></p>

<p align="left"><u><font size="2">Periodic Reporting and Audited Financial Statements</font></u></p>

<p align="left" style="text-align: justify"><font size="2">We have registered our
securities under the Securities Exchange Act of 1934, as amended, and have reporting
obligations, including the requirement that we file annual and quarterly reports with the
SEC. In accordance with the requirements of the Securities Exchange Act of 1934, our
annual reports will contain financial statements audited and reported on by our
independent public accountants.</font></p>

<p align="left" style="text-align: justify"><font size="2">We will not acquire a target
business if audited financial statements cannot be obtained for the target business. Our
Management believes that the requirement of having available audited financial statements
for the target business will limit the pool of potential target businesses available for
acquisition.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="DESCRIPTION OF PROPERTY">DESCRIPTION OF PROPERTY</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font size="2">The Registrant's<font
color="#000000"> corporate office is located at 115 East 57th Street, 11th Floor, New
York, NY 10022. </font></font><font size="2" color="#000000">These facilities consist of
approximately 300 square feet of executive office space. The Registrant believes that the
office facilities are sufficient for the foreseeable future and this arrangement will
remain in effect until we will consummate a business combination. </font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="LEGAL PROCEEDINGS">LEGAL PROCEEDINGS</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are not a party
to any pending legal proceeding, nor is our property the subject of a pending legal
proceeding.</font></p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><a
name="MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN OF OPERATION"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN OF OPERATION </strong></font></a><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p style="text-align: justify"><em><font size="2" color="#000000">Overview</font></em></p>

<p style="text-align: justify"><font size="2"><font color="#000000">The Company emerged
from bankruptcy in October 2004 and discontinued its former business operations as a
result of the chapter 7 bankruptcy proceedings. The Company's current business objective
is to seek a business combination with an operating company. We intend to use the
Company's limited personnel and financial resources in connection with such activities. </font>The
Company will utilize its capital stock, debt or a combination of capital stock and debt,
in effecting a business combination. <font color="#000000">It may be expected that
entering into a business combination will involve the issuance of restricted shares of
capital stock. </font>The issuance of additional shares of our capital stock:</font></p>

<p style="text-align: justify"><font size="2" FACE="wingdings">&#159;</font><font size="2">
may significantly reduce the equity interest of our stockholders;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> will likely cause a
change in control if a substantial number of our shares of capital stock are issued, and
most likely will also result in the resignation or removal of our present officer and
director; and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> may adversely affect
the prevailing market price for our common stock.</font></p>

<p style="text-align: justify"><font size="2">Similarly, if we issued debt securities, it
could result in:<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> default and
foreclosure on our assets if our operating revenues after a business combination were
insufficient to pay our debt obligations;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> acceleration of our
obligations to repay the indebtedness even if we have made all principal and interest
payments when due if the debt security contained covenants that required the maintenance
of certain financial ratios or reserves and any such covenants were breached without a
waiver or renegotiations of such covenants;<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> our immediate payment
of all principal and accrued interest, if any, if the debt security was payable on demand;
and<br>
</font><font size="2" FACE="wingdings">&#159;</font><font size="2"> our inability to
obtain additional financing, if necessary, if the debt security contained covenants
restricting our ability to obtain additional financing while such security was
outstanding.</font></p>

<p style="text-align: justify"><font size="2" color="#000000"><em>Liquidity and Capital
Resources</em></font></p>

<p align="justify"><font size="2"><font color="#000000">Since emerging from bankruptcy,
the Company has </font>neither engaged in any operations nor generated any revenues. <font
color="#000000">While we are dependent upon interim funding provided by Management to pay
professional fees and expenses, we have no written finance agreement with Management to
provide any continued funding.</font> However, we may need to raise additional funds
through the issuance of private debt or equity securities if additional administrative
funds are required to consummate a business combination that is presented to us. <font
color="#000000">We have no agreements to issue any debt or equity securities and cannot
predict whether equity or debt financing will become available at terms acceptable to us,
if at all. </font></font></p>

<p align="justify"><font size="2" color="#000000">At March 31, 2006, we had assets of
$2,917 and had $8,618 in liabilities. </font></p>

<p align="justify"><font size="2" color="#000000">There are no limitations in the
Company's articles of incorporation on the Company's ability to borrow funds or raise
funds through the issuance of restricted common stock to effect a business combination.
The Company's limited resources and lack of having cash-generating business operations may
make it difficult to borrow funds or raise capital. The Company's likely inability to
borrow funds or raise funds through the issuance of restricted capital stock required to
effect or facilitate a business combination may have a material adverse effect on the
Company's financial condition and future prospects, including the ability to complete a
business combination. To the extent that debt financing ultimately proves to be available,
any borrowing will subject us to various risks traditionally associated with indebtedness,
including the risks of interest rate fluctuations and insufficiency of cash flow to pay
principal and interest, including debt of an acquired business. </font></p>

<p align="justify"><em><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Off-Balance Sheet
Arrangements</font></em></p>

<p align="justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of March 31,
2006 we did not have any off-balance sheet arrangements as defined in
Item&nbsp;303(a)(4)(ii) of Regulation S-K promulgated under the Securities Act of 1934.</font></p>

<p align="justify"><em><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Contractual
Obligations and Commitments</font></em></p>

<p align="justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of March 31,
2006 we did not have any contractual obligations.</font></p>

<p align="justify"><em><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Critical Accounting
Policies</font></em></p>

<p align="justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our significant
accounting policies are described in the notes to our financial statements for the periods
ended March 31, 2006 and 2005 and for the years ended December 31, 2005 and 2004, and are
included elsewhere in this prospectus.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="MANAGEMENT">MANAGEMENT</a> </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Directors
and Executive Officers</strong></font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following table
sets forth the names and ages of the members of our Board of Directors and our executive
officers and the positions held by each.</font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%" height="1%">
  <tr>
    <td width="20%" bgcolor="#ccffcc" height="1%" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1"><strong>Name</strong></font></td>
    <td width="5%" bgcolor="#ccffcc" height="1%"><font size="1">&nbsp; </font></td>
    <td width="5%" bgcolor="#ccffcc" height="1%" style="border-bottom: 1px solid rgb(0,0,0)"><p
    align="center"><font size="1"><strong>Age</strong></font></td>
    <td width="5%" bgcolor="#ccffcc" height="1%"></td>
    <td width="40%" bgcolor="#ccffcc" height="1%" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1"><strong>Title</strong></font></td>
    <td width="5%" bgcolor="#ccffcc" height="1%"><font size="1">&nbsp; </font></td>
    <td width="20%" bgcolor="#ccffcc" align="center" height="1%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1"><strong>Date Became Executive
    Officer</strong></font></td>
  </tr>
  <tr>
    <td width="20%" bgcolor="#FFFFFF" height="0%"><font size="2">Ivo Heiden</font></td>
    <td width="5%" bgcolor="#FFFFFF" height="0%"><font size="2">&nbsp; </font></td>
    <td width="5%" bgcolor="#FFFFFF" height="0%"><p align="center"><font size="2">39</font></td>
    <td width="5%" bgcolor="#FFFFFF" height="0%"><font size="2">&nbsp; </font></td>
    <td width="40%" bgcolor="#FFFFFF" height="0%"><font size="2">President, CFO and Chairman</font></td>
    <td width="5%" bgcolor="#FFFFFF" height="0%">&nbsp; </td>
    <td width="20%" bgcolor="#FFFFFF" align="center" height="0%"><font size="2">10/2004</font></td>
  </tr>
</table>

<p align="left" style="text-align: justify"><font size="2">Ivo Heiden, 39, has been
President, CFO and Chairman of the Registrant since October 2004. During the last five
years, Mr. Heiden has been engaged in the business of providing corporate securities
compliance service and reorganizing distressed public companies. From October 2000 until
February 2002, Mr. Heiden served as an vice president and director of PlanetLink
Communications, Inc., a public reporting company. Mr. Heiden served as a director of
Jeantex Group, a public reporting company from August 2002 to September 2003. Mr. Heiden
served as CFO and director of Peregrine Industries, Inc., a public reporting company from
March 2004 until February 2006. Mr. Heiden has been CEO and Chairman of Uromed
Corporation, a public reporting company since January 2005.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our director holds
office until the next annual meeting of stockholders and until his successors have been
duly elected and qualified. There are no agreements with respect to the election of
directors. We do not compensate our director. Officers are appointed annually by the Board
of Directors and each executive officer serves at the discretion of the Board of
Directors. We do not have any standing committees at this time.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our director,
officer or affiliates have not, within the past five years, filed any bankruptcy petition,
been convicted in or been the subject of any pending criminal proceedings, or is any such
person the subject or any order, judgment or decree involving the violation of any state
or federal securities laws.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="EXECUTIVE COMPENSATION">EXECUTIVE COMPENSATION</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following table
sets forth information concerning the total compensation that we have paid or that has
accrued on behalf of our chief executive officer and other executive officers with annual
compensation exceeding $100,000 during the fiscal years ending December 31, 2005 and 2004.</font></p>
<div align="left">

<table cellpadding="0" cellspacing="0" width="100%" height="142">
  <tr>
    <td align="justify" valign="middle" width="17%" height="0"></td>
    <td align="justify" valign="middle" width="9%" height="0"></td>
    <td colspan="3" valign="middle" width="30%" height="0"></td>
    <td colspan="3" valign="middle" width="34%" style="BORDER-BOTTOM: black thin solid"
    height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Long-Term Compensation</font></strong></font></p>
    </div></td>
  </tr>
  <tr>
    <td align="justify" valign="middle" width="17%" height="0"></td>
    <td align="justify" valign="middle" width="9%" height="0"></td>
    <td colspan="3" valign="middle" width="30%" style="BORDER-BOTTOM: black thin solid"
    height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Annual Compensation</font></strong></font></p>
    </div></td>
    <td colspan="2" valign="middle" width="24%" style="BORDER-BOTTOM: black thin solid"
    height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Awards</font></strong></font></p>
    </div></td>
    <td valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Payouts</font></strong></font></p>
    </div></td>
  </tr>
  <tr>
    <td valign="middle" width="17%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Name and Principal Position </font></strong></font></p>
    </div></td>
    <td align="left" valign="middle" width="9%" style="BORDER-BOTTOM: black thin solid"
    height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Year </font></strong></font></p>
    </div></td>
    <td valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Salary ($)</font></strong></font></p>
    </div></td>
    <td valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Bonus ($)</font></strong></font></p>
    </div></td>
    <td valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Other Annual Compensation ($)</font></strong></font></p>
    </div></td>
    <td valign="middle" width="12%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Restricted Stock Award(s) ($)</font></strong></font></p>
    </div></td>
    <td valign="middle" width="12%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">Securities Under-lying Options/ SARs (#)</font></strong></font></p>
    </div></td>
    <td align="right" valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid"
    height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">LTIP Payouts ($)</font></strong></font></p>
    </div></td>
    <td valign="middle" width="10%" style="BORDER-BOTTOM: black thin solid" height="0"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><strong><font
    size="1">All other Compensation ($)</font></strong></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="19%" height="0%"><font size="2">Ivo Heiden</font></td>
    <td align="left" valign="middle" width="9%" height="0%"><div
    style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><p><font
    size="2">2005</font></p>
    </div></td>
    <td valign="middle" width="10%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="12%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="12%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" height="0%"><font size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" height="0%"><font size="2">-0-</font></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="17%" bgcolor="#FFFFFF" height="0%"><font size="2">&nbsp;&nbsp;
    President, CFO</font></td>
    <td align="left" valign="middle" width="9%" bgcolor="#FFFFFF" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 1.65pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">2004</font></font></p>
    </div></td>
    <td valign="middle" width="10%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="12%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="12%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
    <td valign="middle" width="10%" align="center" bgcolor="#FFFFFF" height="0%"><font
    size="2">-0-</font></td>
  </tr>
</table>
</div>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Executive
Employment Agreements</strong></font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To date, we have
not entered into any employment agreements with our executive officer.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS">CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS</a> </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font color="#000000" face="Times New Roman"
size="2">During the last two years, to the knowledge of the Company, there was no person
who had or has a direct or indirect material interest in any transaction or proposed
transaction to which the Company was or is a party.&nbsp;Transactions in this context
relate to any transaction which&nbsp;exceeds $60,000.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT">SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following table
sets forth information regarding the beneficial ownership of our common stock as of May
15, 2006. The information in this table provides the ownership information for: each
person known by us to be the beneficial owner of more than 5% of our common stock; each of
our directors; each of our executive officers; and our executive officers and directors as
a group.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Beneficial
ownership has been determined in accordance with the rules and regulations of the SEC and
includes voting or investment power with respect to the shares. Unless otherwise
indicated, the persons named in the table below have sole voting and investment power with
respect to the number of shares indicated as beneficially owned by them.</font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td width="33%" style="border-bottom: 1px solid rgb(0,0,0)"><strong><font
    style="Times New Roman" size="1">Name of Beneficial Owner</font></strong></td>
    <td width="2%" align="right"><font style="Times New Roman" size="1"><strong>&nbsp; </strong></font></td>
    <td width="31%" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><strong><font
    style="Times New Roman" size="1">Common Stock Beneficially Owned (1)</font></strong></td>
    <td width="2%" align="right"><font style="Times New Roman" size="1"><strong>&nbsp; </strong></font></td>
    <td width="32%" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><strong><font
    style="Times New Roman" size="1">Percentage of Common Stock&nbsp; Owned (1)</font></strong></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">Ivo Heiden</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">64,600,000</font></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">69.51%</font></td>
  </tr>
  <tr>
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">115 East
    57th Street, Suite 1118</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">New York,
    NY 10022</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr>
    <td width="33%"><font size="2">&nbsp; </font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">Juergen
    Heiden.</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">7,200,000</font></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">7.75%</font></td>
  </tr>
  <tr>
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">Dorfstrasse
    21</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td width="33%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">18314
    Luedershagen, Germany</font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr>
    <td width="33%"><font size="2">&nbsp; </font></td>
    <td width="2%" align="right"></td>
    <td width="31%" align="right"></td>
    <td width="2%" align="right"></td>
    <td width="32%" align="right"></td>
  </tr>
  <tr>
    <td width="33%" bgcolor="#ccffcc"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">Director
    and Officer as a Group (1 person)</font></td>
    <td width="2%" align="right" bgcolor="#ccffcc"></td>
    <td width="31%" align="right" bgcolor="#ccffcc"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">64,600,000</font></td>
    <td width="2%" align="right" bgcolor="#ccffcc"></td>
    <td width="32%" align="right" bgcolor="#ccffcc"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">69.51%</font></td>
  </tr>
</table>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2">(1)
Applicable percentage ownership is based on 92,931,155 shares of common stock outstanding
as of May 15, 2006. Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or investment power with
respect to securities. Shares of common stock that are currently exercisable or
exercisable within 60 days of May 15, 2006 are deemed to be beneficially owned by the
person holding such securities for the purpose of computing the percentage of ownership of
such person, but are not treated as outstanding&nbsp;for the purpose of computing the
percentage ownership of any other person.</font></p>

<p align="center"><a name="DESCRIPTION OF SECURITIES"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>DESCRIPTION
OF SECURITIES </strong></font></a><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following
description of our capital stock is a summary and is qualified in its entirety by the
provisions of our Articles of Incorporation, with amendments, all of which have been filed
as exhibits to our registration statement of which this prospectus is a part. </font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Dividend
Policy</strong></font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Holders of common
stock are entitled to dividends when, as, and if declared by the Board of Directors, out
of funds legally available therefore. We have never declared cash dividends on its common
stock and our Board of Directors does not anticipate paying cash dividends in the
foreseeable future as it intends to retain future earnings to finance the growth of our
businesses. There are no restrictions in our articles of incorporation or bylaws that
restrict us from declaring dividends. </font></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Capital
Structure </strong></font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our authorized
capital consists of 110,000,000 shares of stock. We are authorized to issue 100,000,000
shares of common stock, par value $0.0001 per share and we are authorized to issue
10,000,000 shares of preferred stock, par value $0.0001 per share, which may be divided
into series and with preferences, limitations, and relative rights as determined by our
Board of Directors. The Company's board of directors is authorized to </font><font
size="2">issue up to one million shares of series A preferred stock, $0.0001 par value
(&quot;Series A Preferred Stock&quot;), the holders of which shall have the right to
appoint one (1) member to the board of directors of the Company. In addition, the
Company's board of directors is authorized to issue up to two million shares of series B
convertible preferred stock, $0.0001 par value (&quot;Series B Convertible Preferred
Stock&quot;). The holders of the Series B Convertible Preferred Stock shall have the
following voting rights. Each share of Series B Convertible Preferred Stock shall be
entitled to 20 (twenty) votes on all matters submitted to a vote of the stockholders of
the Corporation. As of May 15, 2006, no preferred shares are issued and outstanding. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of March 31,
2006, we had 92,931,155 shares of common stock outstanding. Holders of our common stock:
(i) have general ratable rights to dividends from funds legally available therefor, when,
as and if declared by the Board of Directors; (ii) are entitled to share ratably in all of
our assets available for distribution upon liquidation, dissolution or winding up of our
affairs; (iii) do not have preemptive, subscription or conversion rights, nor are there
any redemption or sinking fund provisions applicable thereto; and (iv) are entitled to one
vote per share on all matters on which stockholders may vote at all shareholder meetings.
The common stock does not have cumulative voting rights, which means that the holders of
more than fifty percent of the common stock voting for election of directors can elect one
hundred percent of our directors if they choose to do so. </font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="INDEMNIFICATION FOR SECURITIES ACT LIABILITIES">INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES </a></strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our Bylaws require
that we indemnify any person: </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1) Who was or is a
party, or is threatened to be made a party, to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or investigative
(other than an action by, or in our right) by reason of the fact that he is or was our
director, officer, employee, or agent or is or was serving at our request as a director,
office, employee, or agent of another corporation, partnership, joint venture, trust, or
other enterprise against such costs and expenses, and to the extent and in the manner
provided under Delaware law.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2) Who was or is a
party, or is threatened to be made a party, to any threatened, pending, or completed
action or suit by or in our right to procure a judgment in our favor by reason of the fact
that he is or was our director, officer, employee, or agent or is or was serving at our
request as a director, officer, employee, or agent of another corporation, partnership,
joint venture, trust, or other enterprise against such costs and expenses, and to the
extent and in the manner provided under Delaware law.</font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our Bylaws provide
that the extent, amount and eligibility for the indemnification provided therein will be
made by our Board of Directors. Such determinations will be made by a majority vote of a
quorum consisting of directors who were not parties to such action, suit, or proceeding or
by our shareholders by a majority vote of a quorum consisting of shareholders who were not
parties to such action, suit, or proceeding. We are also authorized by our Bylaws to make
further indemnification as provided under Delaware law except to indemnify any person
against gross negligence or willful misconduct. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be permitted
to directors, officers or persons controlling us pursuant to the foregoing provisions, or
otherwise, we have been advised that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. </font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="LEGAL MATTERS">LEGAL MATTERS</a> </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The validity of the
shares of common stock being offered hereby will be passed upon for us by Lawrence R.
Lonergan, P.C.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="EXPERTS">EXPERTS</a> </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our financial
statements as of December 31, 2005 and 2004, and the related statements of operations,
stockholders' equity and cash flows for the year ended December 31, 2005 and 2004,
appearing in this prospectus and registration statement have been audited by Michael F.
Cronin, CPA, independent registered public accountant, as set forth on their report
thereon appearing elsewhere in this prospectus, and are included in reliance upon such
report given upon the authority of such firm as experts in accounting and auditing. </font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="ADDITIONAL INFORMATION">ADDITIONAL INFORMATION</a> </strong></font><a
href="#TABLE OF CONTENTS"><font face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to
Table of Contents</font></a></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We have filed a
registration statement on Form SB-2 under the Securities Act of 1933, as amended, relating
to the shares of common stock being offered by this prospectus, and reference is made to
such registration statement. This prospectus constitutes the prospectus of Zaxis
International Inc., filed as part of the registration statement, and it does not contain
all information in the registration statement, as certain portions have been omitted in
accordance with the rules and regulations of the Securities and Exchange Commission. </font></p>

<p align="left" style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are subject to
the reporting requirements of the Securities Exchange Act of 1934, as amended, which
requires us to file reports, proxy statements and other information with the Securities
and Exchange Commission. Such reports, proxy statements and other information may be
inspected by public reference facilities of the SEC at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. Because we file documents electronically
with the SEC, you may obtain this information by visiting the SEC's Internet website at
sec.gov. </font></p>
</div>

<p><br style="PAGE-BREAK-BEFORE: always; mso-break-type: section-break" clear="all">
</p>
<div>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><a
name="ZAXIS INTERNATIONAL INC.">ZAXIS INTERNATIONAL INC.</a><br>
INDEX TO FINANCIAL STATEMENTS </strong></font><a href="#TABLE OF CONTENTS"><font
face="TIMES NEW ROMAN, TIMES, SERIF" size="1">Back to Table of Contents</font></a></p>

<p align="center">&nbsp;</p>
<div align="left">

<table cellSpacing="0" cellPadding="0" width="100%">
  <tr bgColor="#ccffcc">
    <td style="BORDER-BOTTOM: #ccffcc" vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u><p><a
    name="UNAUDITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2006 AND 2005">UNAUDITED
    INTERIM FINANCIAL STATEMENTS FOR THE PERIODS ENDED MARCH 31, 2006 AND 2005</a></u></font></p>
    </div></td>
    <td style="BORDER-BOTTOM: #ccffcc" vAlign="top" width="5%"></td>
  </tr>
  <tr bgColor="#ccffcc">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Balance Sheets as of December 31, 2005 (Unaudited) and June 30, 2005">Balance
    Sheet</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>23 </font></p>
    </div></td>
  </tr>
  <tr bgColor="white">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Interim Statements of Operations">Statements of Operations</a> </font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>24 </font></p>
    </div></td>
  </tr>
  <tr bgColor="#ccffcc">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Interim Statement of Cash Flows">Statements of Cash Flows</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>25 </font></p>
    </div></td>
  </tr>
  <tr bgColor="white">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Notes to Unaudited Interim Financial Statements">Notes to Unaudited Interim
    Financial Statements</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>26 </font></p>
    </div></td>
  </tr>
</table>
</div>

<p align="center">&nbsp;</p>
<div align="left">

<table cellSpacing="0" cellPadding="0" width="100%">
  <tr bgColor="#ccffcc">
    <td style="BORDER-BOTTOM: #ccffcc" vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u><p>YEARS
    ENDED DECEMBER 31, 2005 AND 2004 (AUDITED)</u></font></p>
    </div></td>
    <td style="BORDER-BOTTOM: #ccffcc" vAlign="top" width="5%"></td>
  </tr>
  <tr bgColor="white">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><a
    href="#REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM">Report of Independent
    Registered Public Accounting Firm</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>28</font></p>
    </div></td>
  </tr>
  <tr bgColor="#ccffcc">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Balance Sheets as of December 31, 2005 (Unaudited) and June 30, 2005">Balance
    Sheet</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>29</font></p>
    </div></td>
  </tr>
  <tr bgColor="white">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Statement of Operations">Statements of Operations</a> </font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>30 </font></p>
    </div></td>
  </tr>
  <tr bgColor="#ccffcc">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Statement of Cash Flows">Statements of Cash Flows</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>31 </font></p>
    </div></td>
  </tr>
  <tr bgColor="white">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Consolidated Statements of Stockholders' Deficiency">Statements of Stockholders'
    Equity (Deficit)</a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>32 </font></p>
    </div></td>
  </tr>
  <tr bgColor="#ccffcc">
    <td vAlign="top" align="left" width="95%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>&nbsp;&nbsp;
    <a href="#Background and Significant Accounting Policies">Notes to Financial Statements </a></font></p>
    </div></td>
    <td vAlign="top" width="5%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>33 </font></p>
    </div></td>
  </tr>
</table>
</div>

<p align="center">&nbsp;</p>
<a href="#BACKGROUND ANDSIGNIFICANT ACCOUNTING POLICIESJune 30, 2005"></div></a>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><strong><font size="2">Unaudited Interim Financial Statements</font></strong></p>

<table style="BORDER-BOTTOM: rgb(0,0,0) 1px" height="1%" cellSpacing="0" cellPadding="0"
width="100%" border="0">
  <tr>
    <td vAlign="middle" width="100%" height="0%" colspan="5" align="center" bgcolor="#ccffcc"><font
    size="2"><b>Zaxis International Inc.</b></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0%" colspan="5" align="center"><font size="2"><a
    name="Interim Balance Sheets">Balance Sheets</a> </font><a
    href="#UNAUDITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2006 AND 2005"><font
    size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0%" colspan="5" align="center"><font size="1">&nbsp;
    </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="1%"><font size="1"><strong>&nbsp;&nbsp; </strong></font></td>
    <td vAlign="middle" align="right" width="2%" height="1%"></td>
    <td vAlign="middle" align="right" width="13%" height="1%"><font size="1"><strong>March 31,
    2006</strong></font></td>
    <td vAlign="middle" align="right" width="2%" height="1%"></td>
    <td vAlign="middle" align="right" width="13%" height="1%"><font size="1"><strong>December
    31, 2005</strong></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">(Unaudited)</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">&nbsp; </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><p align="center"><font size="2">Assets</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">Current assets:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; Cash</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">2,917</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">461</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Total
    current assets</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">2,917</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">461</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; Other assets</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"
    style="border-bottom: 1px none rgb(0,0,0)"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total Assets</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">2,917</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 2px none rgb(0,0,0)"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">461</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><p align="center"><font size="2">Liabilities
    and Stockholders' Deficiency</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">Current liabilities:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; Payable-related
    parties</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">8,618</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">3,618</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;
    &nbsp;&nbsp; Total current liabilities</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">8,618</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 1px none rgb(0,0,0)"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0%" bgcolor="#ccffcc"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">3,618</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">Stockholders' deficiency:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">Preferred stock, 10,000,000
    shares authorized, $0.0001 par value, none issued</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">-</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">-</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">Common stock, 100,000,000
    shares authorized, $0.0001 par value;</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;
    92,933,155 issued and outstanding at March 31, 2006 and </font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;
    92,233,155 issued and outstanding at December 31, 2005</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">9,293</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">9,233</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; Additional paid in
    capital</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">14,691</font></td>
    <td vAlign="middle" align="right" width="2%" height="0%"></td>
    <td vAlign="middle" align="right" width="13%" height="0%"><font size="2">(3,249)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp; Accumulated
    deficit</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">(29,685)</font></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">(9,141)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Total
    stockholders' deficiency</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">(5,701)</font></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">(3,157)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%"><font size="2">&nbsp; </font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">&nbsp;&nbsp; </font></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0%"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0%" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total liabilities and stockholders' deficiency</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0%" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%" bgcolor="#ccffcc"><font size="2">2,917</font></td>
    <td style="border-bottom: 2px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0%" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0%" bgcolor="#ccffcc"><font size="2">461</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0%" bgcolor="#FFFFFF" colspan="5"><font size="2">&nbsp;
    </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0%" bgcolor="#FFFFFF" colspan="5"><font size="2">See
    notes to unaudited interim financial statements</font></td>
  </tr>
</table>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<table height="0" cellSpacing="0" cellPadding="0" width="100%" border="0">
  <tr>
    <td width="100%" height="0" colspan="5" align="center" bgcolor="#ccffcc"><font size="2"><b>Zaxis
    International Inc.</b></font></td>
  </tr>
  <tr>
    <td width="100%" height="0" colspan="5" align="center"><font size="2"><a
    name="Interim Statements of Operations">Statements of Operations</a> </font><a
    href="#UNAUDITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2006 AND 2005"><font
    size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td width="100%" height="0" colspan="5"><font size="1">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Three Months</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Three Months</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Ended</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Ended</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>March 31, 2006</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>March 31, 2005</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="1">(Unaudited)</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1">(Unaudited)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp; </font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" bgcolor="#FFFFFF" align="right" height="0"></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Revenue</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" bgcolor="#ccffcc" align="right" height="0"><font size="2">0</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Costs and expenses:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; General and administrative</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">20,544</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">2,535</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Total costs and expenses</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="2">20,544</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">2,535</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2"><strong>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </strong>Net loss</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" align="right" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)" height="0"><font size="2">(20,544)</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">(2,535)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Basic and diluted per share amounts:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Basic and diluted net loss</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" align="right" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">(0.00)</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0.00</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">Weighted average shares
    outstanding (basic and diluted)</font></td>
    <td width="2%" height="0" align="right" bgcolor="#FFFFFF"></td>
    <td width="13%" align="right" bgcolor="#FFFFFF"
    style="border-bottom: 2px double rgb(0,0,0)" height="0"><font size="2">92,352,935</font></td>
    <td width="2%" height="0" align="right" bgcolor="#FFFFFF"></td>
    <td width="13%" height="0" align="right" bgcolor="#FFFFFF"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">16,245,623</font></td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5">&nbsp; </td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">See notes to
    unaudited interim financial statements</font></td>
  </tr>
</table>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<table cellSpacing="0" cellPadding="0" width="100%" border="0" height="0%">
  <tr>
    <td width="101%" height="0" colspan="5" align="center" bgcolor="#ccffcc"><font size="2"><b>Zaxis
    International Inc.</b></font></td>
  </tr>
  <tr>
    <td width="101%" height="0" colspan="5" align="center"><font size="2"><a
    name="Interim Statement of Cash Flows">Statement of Cash Flows</a> </font><a
    href="#UNAUDITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2006 AND 2005"><font
    size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td width="101%" height="0" colspan="5" align="center"><p align="left"><font size="1">&nbsp;&nbsp;
    &nbsp; </font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Three Months</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="1"><strong>Three Months</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>Ended</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="1"><strong>Ended</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="1"><strong>March 31, 2006</strong></font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="1"><strong>March 31, 2005</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="1">(Unaudited)</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1">(Unaudited)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="1">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash flows from operating activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Net loss</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"><font size="2">(20,544)</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td align="right" width="13%" height="0" bgcolor="#ccffcc"><font size="2">(2,535)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Expenses paid by issuance of common stock</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">18,000</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"><font size="2">-</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Adjustments to reconcile net loss to cash used
    in operating activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; (Increase) decrease in current
    assets</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">0</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; Increase (decrease) in accounts
    payable and accrued expenses</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Cash
    flows used by operating activities</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">(2,544)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" align="right" width="2%" height="0"
    bgcolor="#ccffcc"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px solid" align="right" width="13%" height="0"
    bgcolor="#ccffcc"><font size="2">(2,535)</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">Cash flows from investing
    activities:</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">&nbsp; </font></td>
    <td align="right" width="2%" height="0" bgcolor="#FFFFFF"></td>
    <td align="right" width="13%" height="0" bgcolor="#FFFFFF"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Cash
    used in investing activities</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"
    bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash flows from financing activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">&nbsp;&nbsp; Proceeds from the
    issuance of common and preferred stock</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"><font size="2">0</font></td>
    <td align="right" width="2%" height="0" bgcolor="#FFFFFF"></td>
    <td align="right" width="13%" height="0" bgcolor="#FFFFFF"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; Advances from related party</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">5,000</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="2">2,535</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Cash
    generated by financing activities</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">5,000</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"
    bgcolor="#ccffcc"><font size="2">2,535</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Change in cash</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">2,456</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash - beginning of period</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">461</font></td>
    <td align="right" width="2%" height="0"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px solid" align="right" width="13%" height="0"><font
    size="2">84</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Cash - end of period</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">2,917</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" align="right" width="2%" height="0"
    bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px double" align="right" width="13%" height="0"
    bgcolor="#ccffcc"><font size="2">84</font></td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">See notes to
    unaudited interim financial statements</font></td>
  </tr>
</table>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div><font size="2"><b>

<p ALIGN="center">ZAXIS INTERNATIONAL INC.<br>
</b><a name="Notes to Unaudited Interim Financial Statements">Notes to Unaudited Interim
Financial Statements</a> </font><a
href="#UNAUDITED INTERIM FINANCIAL STATEMENTS FOR THE THREE-MONTH PERIOD ENDED MARCH 31, 2006 AND 2005"><font
size="1">Back to Table of Contents</font></a><font size="2"></p>
<b>

<p ALIGN="JUSTIFY">1. Basis of Presentation</b></p>

<p ALIGN="JUSTIFY">The consolidated financial statements include the accounts of Zaxis
International Inc., a Delaware corporation.</p>

<p ALIGN="JUSTIFY">The Financial Statements presented herein have been prepared by us in
accordance with the accounting policies described in our December 31, 2005 Annual Report
on Form 10-KSB and should be read in conjunction with the Notes to Consolidated Financial
Statements which appear in that report.</p>

<p ALIGN="JUSTIFY">The preparation of these financial statements in conformity with
accounting principles generally accepted in the United States requires us to make
estimates and judgments that affect the reported amounts of assets, liabilities, revenues
and expenses, and related disclosure of contingent assets and liabilities. On an on going
basis, we evaluate our estimates, including those related intangible assets, income taxes,
insurance obligations and contingencies and litigation. We base our estimates on
historical experience and on various other assumptions that are believed to be reasonable
under the circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from other
resources. Actual results may differ from these estimates under different assumptions or
conditions.</p>

<p ALIGN="JUSTIFY">In the opinion of management, the information furnished in this Form
10-QSB reflects all adjustments necessary for a fair statement of the financial position
and results of operations and cash flows as of and for the three month periods ended March
31, 2006 and 2005. All such adjustments are of a normal recurring nature. The Consolidated
Financial Statements have been prepared in accordance with the instructions to Form 10-QSB
and therefore do not include some information and notes necessary to conform with annual
reporting requirements.</p>
<b>

<p ALIGN="JUSTIFY">&quot;Fresh Start&quot; Accounting: </b>On November 6, 2002 all assets
were transferred to the chapter 7 trustee in settlement of all outstanding corporate
obligations. We adopted &quot;fresh-start&quot; accounting as of November 7, 2002 in
accordance with procedures specified by AICPA Statement of Position (&quot;SOP&quot;) No.
90-7, &quot;Financial Reporting by Entities in Reorganization under the Bankruptcy
Code.&quot;</p>

<p ALIGN="JUSTIFY">All results for periods subsequent to November 7, 2002 are referred to
as those of the &quot;Successor Company&quot;.</p>

<p ALIGN="JUSTIFY">In accordance with SOP No. 90-7, the reorganized value of the Company
was allocated to the Company's assets based on procedures specified by SFAS No. 141,
&quot;Business Combinations&quot;. Each liability existing at the plan sale date, other
than deferred taxes, was stated at the present value of the amounts to be paid at
appropriate market rates. It was determined that the Company's reorganization value
computed immediately before November 6, 2002 was $0. We adopted &quot;fresh-start&quot;
accounting because holders of existing voting shares immediately before filing and
confirmation of the sale received less than 50% of the voting shares of the emerging
entity and its reorganization value is less than its post-petition liabilities and allowed
claims.</p>
<b>

<p ALIGN="JUSTIFY">2. Bankruptcy Proceedings</b></p>

<p ALIGN="JUSTIFY">On November 6, 2002, the Registrant filed a voluntary Chapter 7
petition under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court Northern District of
Ohio (case no. 02-55160). On October 13, 2004, the Bankruptcy Court approved an Order
confirming the sale of debtor's interest in personal property to Park Avenue Group Inc.
The material terms of the transaction confirmed by Bankruptcy Court authorized Park Avenue
Group to appoint new members to the Registrant's board of directors and authorized those
newly-appointed board of directors be to:</p>

<ul>
  <li>amend the Article of Incorporation to increase the number of authorized shares to
    100,000,000 shares;</li>
  <li>amend the Article of Incorporation to change the par value of our common and preferred
    stock to $0.0001;</li>
  <li>issue up to 30,000,000 shares of common stock, par value $0.0001 to the new management
    which management was appointed by the newly-constituted board of directors;</li>
  <li>implement a reverse split of the issued and outstanding shares in a ratio to be
    determined by the board of directors;</li>
  <li>cancel and extinguish all common share conversion rights of any kind, including without
    limitation, warrants, options, convertible bonds, other convertible debt instruments and
    convertible preferred stock; and</li>
  <li>cancel and extinguish all preferred shares of every series and accompanying conversion
    rights of any kind.</li>
</ul>

<p ALIGN="JUSTIFY">The accounts of the former subsidiaries were not included in the sale
and have not been carried forward</font><font SIZE="3">. </font><b><font size="1"></p>
</font><font size="2">

<p ALIGN="JUSTIFY">Change in Control</b></p>

<p ALIGN="JUSTIFY">In connection with the Order confirming the sale of debtor's interest
in certain intangible personal property to Park Avenue Group Inc. approved by the U.S.
Bankruptcy Court Northern District of Ohio on October 13, 2004, the Court authorized a
change in control pursuant to which Ivo Heiden became our sole director on October 13,
2004, and was appointed president by the new board of directors on October 19, 2004. The
Court order further provided that the sale was free and clear of liens, claims and
interests of others and that the sale was free and clear of any and all other real or
personal property interests, including any interests in Zaxis's subsidiaries. The
Bankruptcy Court Order provided that the existing officers and directors were deemed
removed from office and also authorized the appointment of new members to the board of
directors.</p>

<p ALIGN="JUSTIFY">On November 30, 2004 the board of directors approved and authorized an
amendment of our Article of Incorporation to establish a series B convertible preferred
stock, par value $0.0001 (&quot;Series B Convertible Preferred Stock&quot;). The holders
of the Series B Convertible Preferred Stock shall be entitled to 20 (twenty) votes on all
matters submitted to a vote of the stockholders of the Registrant. The holders of Series B
Convertible Preferred Stock shall have the right to convert each share into 20 (twenty)
shares of common stock upon their written request at any time. On December 7, 2004, the
board of directors authorized the issuance of 840,000 shares of Series B Convertible
Preferred Stock, which resulted in a change in control.</font></p>
<font size="2"><b>

<p ALIGN="JUSTIFY">3. Earnings/Loss Per Share</b></p>

<p ALIGN="JUSTIFY">Basic earnings per share is computed by dividing income available to
common shareholders (the numerator) by the weighted-average number of common shares
outstanding (the denominator) for the period. Diluted earnings per share assume that any
dilutive convertible securities outstanding were converted, with related preferred stock
dividend requirements and outstanding common shares adjusted accordingly. It also assumes
that outstanding common shares were increased by shares issuable upon exercise of those
stock options for which market price exceeds the exercise price, less shares which could
have been purchased by us with the related proceeds. In periods of losses, diluted loss
per share is computed on the same basis as basic loss per share as the inclusion of any
other potential shares outstanding would be anti-dilutive.</font></p>
<font size="2"><b>

<p ALIGN="JUSTIFY">4. New Accounting Standards</b></p>

<p ALIGN="JUSTIFY">On January 1, 2006, we adopted the provisions of Statement of Financial
Accounting Standards (&quot;SFAS&quot;) 123R, &quot;Share-Based Payment&quot; (&quot;SFAS
123(R)&quot;), which requires that companies measure and recognize compensation expense at
an amount equal to the fair value of share-based payments granted under compensation
arrangements. Prior to January 1, 2006, we accounted for our stock-based compensation
plans under the recognition and measurement principles of Accounting Principles Board
(&quot;APB&quot;) Opinion 25, &quot;Accounting for Stock Issued to Employees,&quot; and
related interpretations, and would typically recognize no compensation expense for stock
option grants if options granted had an exercise price equal to the market value of the
underlying common stock on the date of grant.</font></p>
<font size="2">

<p ALIGN="JUSTIFY">We adopted SFAS 123(R) using the &quot;modified prospective&quot;
method, which results in no restatement of prior period amounts. Under this method, the
provisions of SFAS 123(R) apply to all awards granted or modified after the date of
adoption. In addition, compensation expense must be recognized for any unvested stock
option awards outstanding as of the date of adoption on a straight-line basis over the
remaining vesting period. We calculate the fair value of options using a Black-Scholes
option pricing model. We do not currently have any outstanding options therefore no charge
is required for the three months ended March 31, 2006. SFAS 123(R) also requires the
benefits of tax deductions in excess of recognized compensation expense to be reported in
the Statement of Cash Flows as a financing cash inflow rather than an operating cash
inflow. In addition, SFAS 123(R) required a modification to the Company&#146;s calculation
of the dilutive effect of stock option awards on earnings per share. For companies that
adopt SFAS 123(R) using the &quot;modified prospective&quot; method, disclosure of pro
forma information for periods prior to adoption must continue to be made.</p>

<p style="text-align: justify">In May 2005, the FASB issued SFAS No. 154, &quot;Accounting
Changes and Error Corrections,&quot; which replaces APB Opinion No. 20 &quot;Accounting
Changes,&quot; and FASB Statement No. 3 &quot;Reporting Accounting Changes in Interim
Financial Statements,&quot; and changes the requirements for the accounting for and
reporting of a change in accounting principle. This Statement requires retrospective
application to prior periods&#146; financial statements of changes in accounting
principle, unless it is impracticable to determine either the period-specific effects or
the cumulative effect of the change. This Statement shall be effective for accounting
changes and corrections of errors made in fiscal years beginning after December 15, 2005.
Early adoption is permitted for accounting changes and corrections of errors made in
fiscal years beginning after the date this Statement is issued.</font></p>
</div>

<p><a href="#BACKGROUND ANDSIGNIFICANT ACCOUNTING POLICIESJune 30, 2005"><br
style="PAGE-BREAK-BEFORE: always; mso-break-type: section-break" clear="all">
</a></p>
<div><font size="2"><b>

<p ALIGN="center"><a name="REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM">REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</a> </b><a
href="#ZAXIS INTERNATIONAL INC."><font size="1">Back to Table of Contents</font></a></p>

<p ALIGN="JUSTIFY">To the Board of Directors and Stockholders<br>
Zaxis International Inc. </p>

<p ALIGN="JUSTIFY">I have audited the accompanying balance sheet of Zaxis International
Inc. as of December 31, 2005 and 2004 and the related statements of operations, changes in
stockholders&#146; equity and cash flows for the years then ended. These financial
statements are the responsibility of the Company&#146;s management. My responsibility is
to express an opinion on these financial statements based on my audit.</p>

<p ALIGN="JUSTIFY">I conducted my audit in accordance with auditing standards established
by the Public Company Accounting Oversight Board (United States). Those standards require
that I plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The company is not required to
have, nor was I engaged to perform, an audit of its internal control over financial
reporting. My audit included consideration of internal control over financial reporting as
a basis for designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, I express no such opinion. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial
statement presentation. I believe that my audit provides a reasonable basis for my
opinion.</p>

<p ALIGN="JUSTIFY">In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Zaxis International Inc. as of
December 31, 2005 and 2004 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 of America.</p>

<p ALIGN="JUSTIFY">The Company adopted &quot;fresh-start&quot; accounting as of November
7, 2002. The impact of this is more fully described in note 1 of the financial statements.
</p>

<p ALIGN="JUSTIFY">Michael F. Cronin, CPA</p>

<p ALIGN="JUSTIFY">Rochester. New York </p>

<p ALIGN="JUSTIFY">March 24, 2006</p>
</font></div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<table style="BORDER-BOTTOM: rgb(0,0,0) 1px" height="0" cellSpacing="0" cellPadding="0"
width="100%" border="0">
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="5" align="center" bgcolor="#ccffcc"><font
    size="2"><b>Zaxis International Inc.</b></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="5" align="center"><font size="2"><a
    name="Balance Sheets as of December 31, 2005 (Unaudited) and June 30, 2005">Balance Sheets</a>
    </font><a href="#ZAXIS INTERNATIONAL INC."><font size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1"><strong>December 31, 2005</strong></font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1"><strong>December 31, 2004</strong></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><p align="center"><font size="2">Assets</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">Current assets:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0" bgcolor="#FFFFFF"><font size="2">Cash</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"><font size="2">$</font></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#FFFFFF"><font size="2">461</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"><font size="2">$</font></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#FFFFFF"><font size="2">84</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;
    Total current assets</font></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#ccffcc"><font size="2">461</font></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#ccffcc"><font size="2">84</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <strong>Total Assets</strong></font></td>
    <td vAlign="middle" align="right" width="2%" height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">461</font></td>
    <td vAlign="middle" align="right" width="2%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 2px none rgb(0,0,0)"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">84</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><p align="center"><font size="2">Liabilities
    and Stockholders' Deficiency</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">Current liabilities:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">Payable-related party</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">3,618</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">404</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;
    Total current liabilities</font></td>
    <td vAlign="middle" align="right" width="2%" height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">3,618</font></td>
    <td vAlign="middle" align="right" width="2%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 1px none rgb(0,0,0)"><font size="2">$</font></td>
    <td vAlign="middle" align="right" width="13%" height="0" bgcolor="#ccffcc"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">404</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">Stockholders' deficiency:</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp; Preferred stock,
    $0.0001 par value; 10,000,000 shares authorized;</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Series
    A preferred stock, 1,000,000 authorized, none issued;</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">-</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">-</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Series
    B convertible preferred stock, 2,000,000 authorized;</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 0
    issued at of December 31, 2005 and 840,000 issued at of December 31, 2004;</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">-</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">84</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp; Common stock,
    $0.0001 par value; 100,000,000 shares authorized; </font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;
    92,333,155 issued and outstanding at December 31, 2005; and</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;
    16,245,623 issued and outstanding at December 31, 2004</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">9,233</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">1,625</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp; Additional paid in
    capital</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">(3,249)</font></td>
    <td vAlign="middle" align="right" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="13%" height="0"><font size="2">(1,625)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp; Accumulated deficit</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0"><font size="2">(9,141)</font></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0"><font size="2">(404)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; Total
    Stockholders' Deficiency</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0"><font size="2">(3,157)</font></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0"><font size="2">(320)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    <strong>Total Liabilities and Stockholders' Deficiency</strong></font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#ccffcc"><font size="2">461</font></td>
    <td style="border-bottom: 2px none rgb(0,0,0)" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="13%"
    height="0" bgcolor="#ccffcc"><font size="2">84</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">&nbsp;
    </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">See
    Summary of Significant Accounting Policies and Notes to Financial Statements.</font></td>
  </tr>
</table>

<p>&nbsp;</p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<table height="0%" cellSpacing="0" cellPadding="0" width="100%" border="0">
  <tr>
    <td width="104%" height="0" bgcolor="#ccffcc" colspan="5" align="center"><font size="2"><b>Zaxis
    International Inc.</b></font></td>
  </tr>
  <tr>
    <td width="104%" height="0" colspan="5" align="center"><font size="2"><a
    name="Statement of Operations">Statement of Operations</a> </font><a
    href="#ZAXIS INTERNATIONAL INC."><font size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td width="104%" height="0" colspan="5" align="center"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><strong><font size="1">Year Ended</font></strong></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><strong><font size="1">Year Ended</font></strong></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><strong><font
    size="1">December 31, 2005</font></strong></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><strong><font
    size="1">December 31, 2004</font></strong></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" bgcolor="#FFFFFF" align="right" height="0"></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Revenue</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" bgcolor="#ccffcc" align="right" height="0"><font size="2">0</font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Costs and Expenses:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">&nbsp;&nbsp; General and
    administrative</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" bgcolor="#FFFFFF" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font size="2">8,737</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Total costs and expenses</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"></td>
    <td width="13%" align="right" bgcolor="#ccffcc" height="0"><font size="2">8,737</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Loss from continuing operations before
    discontinued operations</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="2">(8,737)</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0">&nbsp; </td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Discontinued operations:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; Loss from discontinued operations
    (net of taxes)</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"><font size="2">0</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">&nbsp;&nbsp; Gain on disposal
    of assets used in discontinued operations</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" bgcolor="#FFFFFF" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font size="2">0</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Income from discontinued
    operations</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"></td>
    <td width="13%" align="right" bgcolor="#ccffcc" height="0"><font size="2">0</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Net income (loss)</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" align="right" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)" height="0"><font size="2">(8,737)</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Basic and diluted per shares amounts:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Continuing operations</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" align="right" height="0"><font size="2">(0.00)</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" align="right"><font size="2">0.00</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Discontinued operations</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" align="right" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0.00</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0.00</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Basic and diluted net loss</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" style="border-bottom: 2px double rgb(0,0,0)"><font
    size="2">(0.00)</font></td>
    <td width="2%" height="0" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" style="border-bottom: 2px double rgb(0,0,0)"><font
    size="2">0.00</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Weighted average shares outstanding (basic and
    diluted)</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" align="right" height="0" style="border-bottom: 2px double rgb(0,0,0)"><font
    size="2">34,082,812</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 2px double rgb(0,0,0)"><font
    size="2">16,245,623</font></td>
  </tr>
  <tr>
    <td width="104%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="104%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">See Summary of
    Significant Accounting Policies and Notes to Financial Statements.</font></td>
  </tr>
</table>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p>&nbsp;</p>

<table cellSpacing="0" cellPadding="0" width="100%" border="0" height="0">
  <tr>
    <td width="101%" height="0" colspan="5" align="center" bgcolor="#ccffcc"><font size="2"><b>Zaxis
    International Inc.</b></font></td>
  </tr>
  <tr>
    <td width="101%" height="0" colspan="5" align="center"><font face="Times New Roman"
    size="2"><a name="Statement of Cash Flows">Statement of Cash Flows</a> </font><a
    href="#ZAXIS INTERNATIONAL INC."><font size="1">Back to Table of Contents</font></a></td>
  </tr>
  <tr>
    <td width="101%" height="0" colspan="5" align="center"><p align="left"><font size="2">&nbsp;&nbsp;
    &nbsp; </font></td>
  </tr>
  <tr>
    <td width="70%" height="0"></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><strong><font size="1">Year ended</font></strong></td>
    <td align="right" width="2%" height="0"></td>
    <td width="13%" height="0" align="right"><strong><font size="1">Year ended</font></strong></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="1">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1"><strong>December 31, 2005</strong></font></td>
    <td align="right" width="2%" height="0"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="1"><strong>December 31, 2004</strong></font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash flows from operating activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">Net income (loss)</font></td>
    <td width="2%" height="0" align="right" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td width="13%" height="0" align="right" bgcolor="#ccffcc"><font size="2">(8,737)</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"><font size="2">$</font></td>
    <td align="right" width="13%" height="0" bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Adjustments required to reconcile net loss to
    cash used in operating activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; (Increase) decrease in current
    assets</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">0</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; Increase (decrease) in accounts
    payable and accrued expenses</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; <strong>Cash
    flows used by operating activities</strong></font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">(8,787)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px" align="right" width="2%" height="0"
    bgcolor="#ccffcc"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px solid" align="right" width="13%" height="0"
    bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash flows from investing activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">0</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; <strong>Cash
    used in investing activities</strong></font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">0</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"
    bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash flows from financing activities:</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#FFFFFF"><font size="2">&nbsp;&nbsp; Proceeds from
    issuance of common stock</font></td>
    <td width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td width="13%" height="0" bgcolor="#FFFFFF" align="right"><font size="2">5,900</font></td>
    <td align="right" width="2%" height="0" bgcolor="#FFFFFF"></td>
    <td align="right" width="13%" height="0" bgcolor="#FFFFFF"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp;&nbsp; Advances from related parties</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">3,214</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"><font
    size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp; <strong>Cash
    generated by financing activities</strong></font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="2">9,114</font></td>
    <td align="right" width="2%" height="0" bgcolor="#ccffcc"></td>
    <td align="right" width="13%" style="border-bottom: 1px solid rgb(0,0,0)" height="0"
    bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">&nbsp; </font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Change in cash</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right"><font size="2">377</font></td>
    <td align="right" width="2%" height="0"></td>
    <td align="right" width="13%" height="0"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0"><font size="2">Cash - Beginning of period</font></td>
    <td width="2%" height="0" align="right"></td>
    <td width="13%" height="0" align="right" style="border-bottom: 1px solid rgb(0,0,0)"><font
    size="2">84</font></td>
    <td align="right" width="2%" height="0"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 1px solid" align="right" width="13%" height="0"><font
    size="2">0</font></td>
  </tr>
  <tr>
    <td width="70%" height="0" bgcolor="#ccffcc"><font size="2"><strong>Cash - End of period</strong></font></td>
    <td width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="2">$</font></td>
    <td width="13%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="2">461</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" align="right" width="2%" height="0"
    bgcolor="#ccffcc"><font size="2">$</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px double" align="right" width="13%" height="0"
    bgcolor="#ccffcc"><font size="2">0</font></td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="100%" height="0" bgcolor="#FFFFFF" colspan="5"><font size="2">See Summary of
    Significant Accounting Policies and Notes to Financial Statements.</font></td>
  </tr>
</table>

<p>&nbsp;</p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<table height="0" cellSpacing="0" cellPadding="0" width="100%" border="0">
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="12" align="center" bgcolor="#ccffcc"><font
    size="1"><b>Zaxis International Inc.</b></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="12" align="center"><font size="1"><a
    name="Consolidated Statements of Stockholders' Deficiency">Statements of Stockholders'
    Deficiency</a> <a href="#ZAXIS INTERNATIONAL INC.">Back to Table of Contents</a></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="12" align="center"><font size="1">&nbsp;
    </font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" align="right"></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="8%" height="0" align="right"></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="20%" height="0" colspan="3"><p align="center"><strong><font
    size="1">Common Stock</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="8%" height="0"><strong><font size="1">Additional</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" align="right"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" align="right"></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="8%" height="0" align="right"></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="10%" height="0"><p align="right"><strong><font size="1">Number
    of</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" width="8%" height="0"><p align="right"><strong><font size="1">Stated
    Or</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="8%" height="0"><strong><font size="1">Paid-In</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" width="8%" height="0"><p align="right"><strong><font size="1">Accumulated</font></strong></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><strong><font size="1">Shares</font></strong></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><strong><font size="1">Par value</font></strong></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="10%" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><p
    align="right"><strong><font size="1">Shares</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><p
    align="right"><strong><font size="1">Par Value</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" align="right" width="8%" height="0"
    style="border-bottom: 1px solid rgb(0,0,0)"><p align="right"><strong><font size="1">Capital</font></strong></td>
    <td vAlign="middle" width="2%" height="0"></td>
    <td vAlign="middle" width="8%" height="0" style="border-bottom: 1px solid rgb(0,0,0)"><p
    align="right"><strong><font size="1">Deficit</font></strong></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#ccffcc"><font size="1">Balance at
    December 31, 2002</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#ccffcc"><font size="1">16,245,623</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">162,456</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">(162,456)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp;&nbsp;
    Net income</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#ccffcc"><font size="1">Balance at
    December 31, 2003</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"
    style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"><font
    size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"
    style="border-left: 1px none rgb(0,0,0); border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"><font
    size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="10%" height="0" bgcolor="#ccffcc"><font size="1">16,245,623</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#ccffcc"><font size="1">162,456</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#ccffcc"><font size="1">(162,456)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#ccffcc"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp;&nbsp;
    New preferred stock issued for cash</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">840,000</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">84</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0"><font size="1">&nbsp;&nbsp; Net loss</font></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#ccffcc"><font size="1">Balance at
    December 31, 2004</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#CCFFCC" align="right"
    style="border-top: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"><font size="1">840,000</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#CCFFCC" align="right"
    style="border-left: 1px none rgb(0,0,0); border-top: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"><font
    size="1">84</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td style="border-top: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="10%" height="0" bgcolor="#CCFFCC"><font size="1">16,245,623</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#CCFFCC"><font size="1">162,456</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px none rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#CCFFCC"><font size="1">(162,456)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"></td>
    <td style="border-top: 1px solid rgb(0,0,0); border-bottom: 1px none rgb(0,0,0)"
    vAlign="middle" align="right" width="8%" height="0" bgcolor="#ccffcc"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">&nbsp; </font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">Adjustment of
    transfer agent records</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">287,532</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">2,875</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">(2,875)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">Conversion of
    debt into equity</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">55,000,000</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">5,500</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">Sale of common
    stock</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">4,000,000</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">400</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">Conversion of
    preferred stock </font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">(840,000)</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"><font size="1">(84)</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">16,800,000</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">1,680</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">(1,596)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#FFFFFF"><font size="1">Restate par
    value</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#FFFFFF" align="right"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#FFFFFF"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">(163,678)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">163,678</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#FFFFFF"></td>
    <td style="border-bottom: 1px none rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#FFFFFF"><font size="1">0</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0"><font size="1">&nbsp;&nbsp; Net loss</font></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td vAlign="middle" width="8%" height="0" align="right"
    style="border-bottom: 1px solid rgb(0,0,0)"><font size="1">-</font></td>
    <td vAlign="middle" width="2%" height="0" align="right"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">-</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0"></td>
    <td style="border-bottom: 1px solid rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0"><font size="1">(8,737)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="42%" height="0" bgcolor="#ccffcc"><font size="1">Balance at
    December 31, 2005</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="1">0</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"><font size="1">$</font></td>
    <td vAlign="middle" width="8%" height="0" bgcolor="#ccffcc" align="right"
    style="border-bottom: 2px double rgb(0,0,0)"><font size="1">0</font></td>
    <td vAlign="middle" width="2%" height="0" bgcolor="#ccffcc" align="right"></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="10%"
    height="0" bgcolor="#ccffcc"><font size="1">92,333,155</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"><font size="1">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">9,233</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"><font size="1">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">(3,249)</font></td>
    <td style="BORDER-BOTTOM: rgb(0,0,0) 2px" vAlign="middle" align="right" width="2%"
    height="0" bgcolor="#ccffcc"><font size="1">$</font></td>
    <td style="border-bottom: 2px double rgb(0,0,0)" vAlign="middle" align="right" width="8%"
    height="0" bgcolor="#ccffcc"><font size="1">(8,737)</font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="12"><font size="1"><strong>&nbsp; </strong></font></td>
  </tr>
  <tr>
    <td vAlign="middle" width="100%" height="0" colspan="12"><font size="1">See Summary of
    Significant Accounting Policies and Notes to Financial Statements.</font></td>
  </tr>
</table>
</div>

<p><br style="PAGE-BREAK-BEFORE: always; mso-break-type: section-break" clear="all">
</p>
<div><b><font SIZE="3">

<p ALIGN="center"></font><font size="2">ZAXIS INTERNATIONAL, Inc.<br>
</b><a name="Background and Significant Accounting Policies">Background and Significant
Accounting Policies</a> </font><a href="#ZAXIS INTERNATIONAL INC."><font size="1">Back to
Table of Contents</font></a><font size="2"><br>
December 31, 2005</font></p>
<font size="2"><b>

<p ALIGN="JUSTIFY">The Company</b></p>

<p ALIGN="JUSTIFY">Zaxis International Inc.(&quot;International&quot;) was incorporated in
California in 1984 and subsequently chartered in Delaware in 1985<font FACE="Courier New"
SIZE="2">.</font>Prior to filing for bankruptcy under chapter 7, Zaxis manufactured and
distributed products used in a molecular separation<font FACE="Courier New" SIZE="2"> </font>process
known as electrophoresis, a procedure used in research,<font FACE="Courier New" SIZE="2"> </font>industrial
and clinical laboratories worldwide.</p>
<i><u>

<p ALIGN="JUSTIFY">Bankruptcy Proceedings:</u></i><b> </b>On November 6, 2002, the
Registrant filed a voluntary Chapter 7 petition under the U.S. Bankruptcy Code in the U.S.
Bankruptcy Court Northern District of Ohio (case no. 02-55160. As a result of the filing,
all of our properties were transferred to a United States Trustee and we terminated all of
our business operations. The Bankruptcy Trustee has disposed of all of the assets. On
October 13, 2004, the Bankruptcy Court approved an Order confirming the sale of debtor's
interest in personal property to Park Avenue Group, Inc.</p>
<u><i>

<p ALIGN="JUSTIFY">Basis of Presentation:</i></u><b> </b>We adopted
&quot;fresh-start&quot; accounting as of November 7, 2002 in accordance with procedures
specified by AICPA Statement of Position (&quot;SOP&quot;) No. 90-7, &quot;Financial
Reporting by Entities in Reorganization under the Bankruptcy Code.</p>
<b>

<p ALIGN="JUSTIFY">Significant Accounting Policies</b><i><u></p>

<p ALIGN="JUSTIFY">Use of Estimates</u> </i>The preparation of financial statements in
conformity with generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial statement and
the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from the estimates.</p>
<i><u>

<p ALIGN="JUSTIFY">Cash and Cash Equivalents</u>: </i>For financial statement presentation
purposes, the Company considers those short-term, highly liquid investments with original
maturities of three months or less to be cash or cash equivalents.</p>
<u><i>

<p ALIGN="JUSTIFY">Property and Equipment</i></u> New property and equipment are recorded
at cost. Property and equipment included in the bankruptcy proceedings and transferred to
the Trustee had been valued at liquidation value. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets, generally 5 years.
Expenditures for renewals and betterments are capitalized. Expenditures for minor items,
repairs and maintenance are charged to operations as incurred. Gain or loss upon sale or
retirement due to obsolescence is reflected in the operating results in the period the
event takes place.</p>
<i><u>

<p ALIGN="JUSTIFY">Valuation of Long-Lived Assets</u>:</i> We review the recoverability of
our long-lived assets including equipment, goodwill and other intangible assets, when
events or changes in circumstances occur that indicate that the carrying value of the
asset may not be recoverable. The assessment of possible impairment is based on our
ability to recover the carrying value of the asset from the expected future pre-tax cash
flows (undiscounted and without interest charges) of the related operations. If these cash
flows are less than the carrying value of such asset, an impairment loss is recognized for
the difference between estimated fair value and carrying value. Our primary measure of
fair value is based on discounted cash flows. The measurement of impairment requires
management to make estimates of these cash flows related to long-lived assets, as well as
other fair value determinations.</p>
<i><u>

<p ALIGN="JUSTIFY">Stock Based Compensation:</u> </i>Stock-based awards to non-employees
are accounted for using the fair value method in accordance with SFAS No.&nbsp;123, <i>Accounting
for Stock-Based Compensation</i>, and EITF Issue No.&nbsp;96-18, <i>Accounting for Equity
Instruments that are Issued to Other Than Employees for Acquiring, or in Conjunction with
Selling Goods or Services</i>. </p>

<p ALIGN="JUSTIFY">We account for stock-based awards to employees using the intrinsic
value method in accordance with APB Opinion No.&nbsp;25 and FIN No. 44. As permitted by
SFAS No.&nbsp;123, as amended by SFAS No.&nbsp;148, we have chosen to continue to account
for our employee stock-based compensation plans under APB Opinion No.&nbsp;25 and provide
the expanded disclosures specified in SFAS No.&nbsp;123.</p>
<i><u>

<p ALIGN="JUSTIFY">Fair Value of Financial Instruments</u>:</i> Statements of Financial
Accounting Standards No. 107, &quot;Disclosures about Fair Value of Financial
Instruments,&quot; requires disclosure of fair value information about financial
instruments. Fair value estimates discussed herein are based upon certain market
assumptions and pertinent information available to management as of April 30, 2005. The
respective carrying value of certain on-balance sheet financial instruments approximated
their fair values. </p>

<p ALIGN="JUSTIFY">These financial instruments include cash and cash equivalents, accounts
payable and accrued expenses. Fair values were assumed to approximate carrying values for
these financial instruments since they are short-term in nature and their carrying amounts
approximate fair values or they are receivable or payable on demand.</p>
<i><u>

<p ALIGN="JUSTIFY">Earnings per Common Share</u>:</i> Basic net loss per share is computed
using the weighted average number of common shares outstanding during the period. Diluted
net loss per common share is computed using the weighted average number of common and
dilutive equivalent shares outstanding during the period. Dilutive common equivalent
shares consist of options to purchase common stock (only if those options are exercisable
and at prices below the average share price for the period) and shares issueable upon the
conversion of our Preferred Stock. Due to the net losses reported, dilutive common
equivalent shares were excluded from the computation of diluted loss per share, as
inclusion would be anti-dilutive for the periods presented.</p>

<p ALIGN="JUSTIFY">If we had generated earnings during the year ended December 31, 2005,
we would have added 12,749,589 common equivalent shares to the weighted average shares
outstanding to compute the diluted weighted average shares outstanding.</p>

<p ALIGN="JUSTIFY">There were no common equivalent shares required to be added to the
basic weighted average shares outstanding to arrive at diluted weighted average shares
outstanding in 2004.</p>
<i><u>

<p ALIGN="JUSTIFY">Income Taxes:</u> </i>The Company accounts for income taxes in
accordance with Statement of Financial Accounting Standards No. 109, &quot;Accounting for
Income Taxes,&quot; (&quot;SFAS 109&quot;) which requires recognition of estimated income
taxes payable or refundable on income tax returns for the current year and for the
estimated future tax effect attributable to temporary differences and carry-forwards.
Measurement of deferred income tax is based on enacted tax laws including tax rates, with
the measurement of deferred income tax assets being reduced by available tax benefits not
expected to be realized.</p>
<b>

<p ALIGN="JUSTIFY">Recent Accounting Pronouncements</b></p>

<p ALIGN="JUSTIFY">In December 2004, the FASB issued SFAS No. 123 (revised 2004)
&quot;Share-Based Payment,&quot; or SFAS No. 123(R). SFAS No. 123(R) revises FASB
Statement No. 123 &quot;Accounting for Stock-Based Compensation,&quot; and supersedes APB
Opinion No. 25, and its related implementation guidance. This Statement eliminates the
ability to account for share-based compensation using the intrinsic value method under APB
Opinion No. 25. SFAS No. 123(R) focuses primarily on accounting for transactions in which
an entity obtains employee services in share-based payment transactions. SFAS No. 123(R)
requires a public entity to measure the cost of employee services received in exchange for
an award of equity instruments based on the grant-date fair value of the award (with
limited exceptions). That cost will be recognized over the period during which an employee
is required to provide service in exchange for the award, known as the requisite service
period, which is usually the vesting period. SFAS No. 123(R) is effective for companies
filing under Regulation SB as of the beginning of the first interim or annual reporting
period that begins after December 15, 2005, which for us will be our first quarter of the
year ending December 31, 2006. We anticipate adopting SFAS No. 123(R) beginning in the
quarter ending March 31, 2006. Accordingly, the provisions of SFAS No. 123(R) will apply
to new awards and to awards modified, repurchased, or cancelled after the required
effective date. Additionally, compensation cost for the portion of awards for which the
requisite service has not been rendered that are outstanding as of the required effective
date must be recognized as the requisite service is rendered on or after the required
effective date. These new accounting rules will lead to a decrease in reported earnings.
Although our adoption of SFAS No. 123(R) could have a material impact on our financial
position and results of operations, we are still evaluating the potential impact from
adopting this statement.</p>

<p ALIGN="JUSTIFY">In December 2004, the FASB issued FASB Staff Position No. FAS 109-2, or
FAS 109-2, <i>&quot;Accounting and Disclosure Guidance for the Foreign Earnings
Repatriation Provision within the American Jobs Creations Act of 2004.&quot;</i> The AJCA
introduces a limited time 85% dividends received deduction on the repatriation of certain
foreign earnings to a U.S. taxpayer (repatriation provision), provided certain criteria
are met. FAS No. 109-2 provides accounting and disclosure guidance for the repatriation
provision. Although FAS 109-2 is effective immediately, we have not begun our analysis and
do not expect to be able to complete our evaluation of the repatriation provision until
after Congress or the Treasury Department provides additional clarifying language on key
elements of the provision.</p>

<p ALIGN="JUSTIFY">In December 2004, the FASB issued SFAS No. 153, <i>&quot;Exchanges of
Nonmonetary Assets&#151;an amendment of APB Opinion No. 29,&quot;</i> which is effective
for us starting July 1, 2005. In the past, we were frequently required to measure the
value of assets exchanged in non-monetary transactions by using the net book value of the
asset relinquished. Under SFAS No. 153, we will measure assets exchanged at fair value, as
long as the transaction has commercial substance and the fair value of the assets
exchanged is determinable within reasonable limits. A non-monetary exchange has commercial
substance if the future cash flows of the entity are expected to change significantly as a
result of the exchange. The adoption of SFAS No. 153 is not anticipated to have a material
effect on our consolidated financial position, results of operations or cash flows<b>.</p>

<p ALIGN="center">Zaxis International Inc.<br>
</b>Notes to Financial Statements<br>
December 31, 2005</font></p>
<b>

<p ALIGN="JUSTIFY"><font size="2">1. &quot;Fresh Start&quot; Accounting: </b></p>

<p ALIGN="JUSTIFY">On November 6, 2002 all assets were transferred to the chapter 7
trustee in settlement of all outstanding corporate obligations. We adopted
&quot;fresh-start&quot; accounting as of November 7, 2002 in accordance with procedures
specified by AICPA Statement of Position (&quot;SOP&quot;) No. 90-7, &quot;Financial
Reporting by Entities in Reorganization under the Bankruptcy Code.&quot;</p>

<p ALIGN="JUSTIFY">All results for periods subsequent to November 7, 2002 are referred to
as those of the &quot;Successor Company&quot;. </p>

<p ALIGN="JUSTIFY">In accordance with SOP No. 90-7, the reorganized value of the Company
was allocated to the Company's assets based on procedures specified by SFAS No. 141,
&quot;Business Combinations&quot;. Each liability existing at the plan sale date, other
than deferred taxes, was stated at the present value of the amounts to be paid at
appropriate market rates. It was determined that the Company's reorganization value
computed immediately before November 6, 2002 was $0. We adopted &quot;fresh-start&quot;
accounting because holders of existing voting shares immediately before filing and
confirmation of the sale received less than 50% of the voting shares of the emerging
entity and its reorganization value is less than its post-petition liabilities and allowed
claims.</p>
<b>

<p ALIGN="JUSTIFY">2. Bankruptcy Proceedings</b></p>

<p ALIGN="JUSTIFY">On November 6, 2002, the Registrant filed a voluntary Chapter 7
petition under the U.S. Bankruptcy Code in the U.S. Bankruptcy Court Northern District of
Ohio (case no. 02-55160). On October 13, 2004, the Bankruptcy Court approved an Order
confirming the sale of debtor's interest in personal property to Park Avenue Group Inc.
The material terms of the transaction confirmed by Bankruptcy Court authorized Park Avenue
Group to appoint new members to the Registrant's board of directors and authorized those
newly-appointed board of directors be to:</p>

<p></font><font size="2" FACE="wingdings">&#159;</font><font size="2"> amend the Article
of Incorporation to increase the number of authorized shares to 100,000,000 shares;<br>
<font size="2" FACE="wingdings">&#159;</font> amend the Article of Incorporation to change
the par value of our common and preferred stock to $0.0001;<br>
<font size="2" FACE="wingdings">&#159;</font> issue up to 30,000,000 shares of common
stock, par value $0.0001 to the new management which management was appointed by the
newly-constituted board of directors;<br>
<font size="2" FACE="wingdings">&#159;</font> implement a reverse split of the issued and
outstanding shares in a ratio to be determined by the board of directors;<br>
<font size="2" FACE="wingdings">&#159;</font> cancel and extinguish all common share
conversion rights of any kind, including without limitation, warrants, options,
convertible bonds, other convertible debt instruments and convertible preferred stock; and<br>
<font size="2" FACE="wingdings">&#159;</font> cancel and extinguish all preferred shares
of every series and accompanying conversion rights of any kind.</p>

<p ALIGN="JUSTIFY">The accounts of the former subsidiaries were not included in the sale
and have not been carried forward.</p>
<b>

<p ALIGN="JUSTIFY">Resultant Change in Control:</b> Resultant Change in Control: In
connection with the Order confirming the sale of debtor's interest in certain intangible
personal property to Park Avenue Group Inc. approved by the U.S. Bankruptcy Court Northern
District of Ohio on October 13, 2004, the Court authorized a change in control pursuant to
which Ivo Heiden became our sole director on October 13, 2004, and was appointed president
by the new board of directors on October 19, 2004. The Court order further provided that
the sale was free and clear of liens, claims and interests of others and that the sale was
free and clear of any and all other real or personal property interests, including any
interests in Zaxis's subsidiaries. The Bankruptcy Court Order provided that the existing
officers and directors were deemed removed from office and also authorized the appointment
of new members to the board of directors.</p>

<p ALIGN="JUSTIFY">On November 30, 2004 the board of directors approved and authorized an
amendment of our Article of Incorporation to establish a series B convertible preferred
stock, par value $0.0001 (&quot;Series B Convertible Preferred Stock&quot;). The holders
of the Series B Convertible Preferred Stock shall be entitled to 20 (twenty) votes on all
matters submitted to a vote of the stockholders of the Registrant. The holders of Series B
Convertible Preferred Stock shall have the right to convert each share into 20 (twenty)
shares of common stock upon their written request at any time. On December 7, 2004, the
board of directors authorized 2,000,000 shares of Series B Convertible Preferred Stock and
issued 840,000 Series B Convertible Preferred Stock that resulted in a change in control.</p>
<b>

<p ALIGN="JUSTIFY">3. Income Taxes:</b></p>

<p ALIGN="JUSTIFY">Our net operating loss carryovers available to reduce future income
taxes were reduced or eliminated through our bankruptcy proceedings. We have adopted SFAS
109 which provides for the recognition of a deferred tax asset based upon the value the
loss carry-forwards will have to reduce future income taxes and management's estimate of
the probability of the realization of these tax benefits.</p>

<p ALIGN="JUSTIFY">Utilization of federal and state NOL and tax credit carry forwards may
be subject to a substantial annual limitation due to the ownership change limitations
provided by the Internal Revenue Code of 1986, as amended and similar state provisions.
The annual limitation may result in the expiration of NOL and tax credit carry forwards
before full utilization.</p>
<b>

<p ALIGN="JUSTIFY">4. Commitments: </b></p>

<p ALIGN="JUSTIFY">The Company, prior to its bankruptcy, was a party to numerous claims
and threatened litigation. As a result of the bankruptcy and the subsequent transfer by
the Bankruptcy Trustee of the Company&#146;s corporate shell entity free of all liens,
claims and encumbrances pursuant to Section 363(f) of the US Bankruptcy Code, the Company
is no longer party to any litigation. The Company is not a party to any leases and does
not have any commitments.</p>
<b>

<p ALIGN="JUSTIFY">4. Stockholders' Equity: </b><i></p>

<p ALIGN="JUSTIFY">Common Stock</i></p>

<p ALIGN="JUSTIFY">In November, 2004, we modified our authorized shares of common stock to
100,000,000 par value $0.0001. All issued shares of common stock are entitled to vote on a
1 share/1 vote basis. On October 4, 2005 we issued 16,800,000 shares upon the conversion
of our Preferred stock. On October 5, 2005 we issued 55,000,000 shares to one of our
officers in satisfaction of $5,500 due on cash advances.</p>
<i>

<p ALIGN="JUSTIFY">Preferred Stock</i></p>

<p ALIGN="JUSTIFY">On November, 2004 and pursuant to authority granted to it by the
bankruptcy court, the Board cancelled and extinguished all issued and outstanding
preferred stock. All related dividends obligations were also extinguished (the elimination
of this preferred stock has been reflected in the 2002 financial statements) and
authorized 10,000,000 new shares of preferred stock, $0.0001 par value that may be issued
in one or more series. The Board of Directors of the Corporation is authorized to fix the
powers, preferences, rights, qualifications, limitations or restrictions of the Preferred
Stock and any series thereof pursuant to Section 151 of the Delaware General Corporation
Law. On December 7, 2004, we issued of 840,000 shares of Series B Convertible Preferred
Stock, which resulted in a change in control.</p>

<p ALIGN="JUSTIFY">The Board of Directors of the Corporation is authorized to issue:<br>
<font size="2" FACE="wingdings">&#159;</font> Up to one million shares of series A
preferred stock, $0.0001 par value (&quot;Series A Preferred Stock&quot;), the holders of
which shall have the right to appoint one (1) member to the Board of Directors of the
Corporation.<br>
<font size="2" FACE="wingdings">&#159;</font> Up to two million shares of series B
convertible preferred stock, $0.0001 par value (&quot;Series B Convertible Preferred
Stock&quot;). The holders of the Series B Convertible Preferred Stock shall have the
following voting rights: Each share of Series B Convertible Preferred Stock shall be
entitled to 20 (twenty) votes on all matters submitted to a vote of the stockholders of
the Corporation. </p>

<p ALIGN="JUSTIFY">In the event the Corporation shall at any time<br>
<font size="2" FACE="wingdings">&#159;</font> declare a dividend on the Common Stock
payable in shares of Common Stock,<br>
<font size="2" FACE="wingdings">&#159;</font> subdivide the outstanding shares of Common
Stock,<br>
<font size="2" FACE="wingdings">&#159;</font> combine the outstanding shares of Common
Stock into a smaller number of shares or<br>
<font size="2" FACE="wingdings">&#159;</font> issue any of its shares of capital stock in
a reclassification of the outstanding shares of Common Stock (including any such
reclassification in connection with a consolidation or merger in which the Corporation is
the continuing or surviving entity),</p>

<p ALIGN="JUSTIFY">then in each such case the number of votes per share to which holders
of shares of Series B Convertible Preferred Stock would have been entitled to immediately
prior to such event must be adjusted by multiplying such number by a fraction, the
numerator of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event. The holders of Series B Convertible Preferred
Stock have the right to convert each share into 20 (twenty) shares of Common Stock upon
their written request at any time. <i><font SIZE="3"></p>

<p ALIGN="JUSTIFY"></font>Stock Based Compensation</i></p>

<p ALIGN="JUSTIFY">Stock based compensation is accounted for by using the intrinsic value
based method in accordance with Accounting Principles Board Opinion No. 25,
&quot;Accounting for Stock Issued to Employees&quot; (&quot;APB 25&quot;). The Company has
adopted Statements of Financial Accounting Standards No. 123, &quot;Accounting for Stock
Based Compensation, (&quot;SFAS 123&quot;) which allows companies to either continue to
account for stock based compensation to employees under APB 25, or adopt a fair value
based method of accounting. The Company has elected to continue to account for stock based
compensation to employees under APB 25. APB 25 recognizes compensation expense for options
granted to employees only when the market price of the stock exceeds the grant exercise
price at the date of the grant. The amount reflected as compensation expense is measured
as the difference between the exercise price and the market value at the date of the
grant. </p>

<p ALIGN="JUSTIFY">There are no employee or non-employee options granted.</p>
</font></div>

<p>&nbsp;</p>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="left">&nbsp;</p>

<p align="left">&nbsp;</p>

<p align="left">&nbsp;</p>

<p align="left">&nbsp;</p>

<p align="left">&nbsp;</p>

<p align="left">&nbsp;</p>

<p align="center"><font size="4"><strong>76,400,000</strong></font></p>

<p align="center"><strong><font style="Times New Roman" size="4">Shares of</font></strong></p>

<p align="center"><strong><font style="Times New Roman" size="4">Common Stock</font></strong></p>

<p align="center"><strong><font style="Times New Roman" size="4">of</font></strong></p>

<p align="center"><strong><font style="Times New Roman" size="6">Zaxis International Inc.</font></strong></p>

<p align="center">&nbsp;</p>

<p align="center"><strong><font style="Times New Roman" size="4">PROSPECTUS </font></strong></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" color="#FF0000"><strong>The
date of this prospectus is _______, 2006</strong></font></p>

<p align="center">&nbsp;</p>

<p align="center">&nbsp;</p>

<p align="center">&nbsp;</p>
</div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>PART II</strong></font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>INFORMATION
NOT REQUIRED IN PROSPECTUS</strong></font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
24. Indemnification of Directors and Officers</strong></font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our Bylaws
require that we indemnify any person:</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(1) Who was or is a
party, or is threatened to be made a party, to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or investigative
(other than an action by, or in our right) by reason of the fact that he is or was our
director, officer, employee, or agent or is or was serving at our request as a director,
office, employee, or agent of another corporation, partnership, joint venture, trust, or
other enterprise against such costs and expenses, and to the extent and in the manner
provided under Delaware law.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2) Who was or is a
party, or is threatened to be made a party, to any threatened, pending, or completed
action or suit by or in our right to procure a judgment in our favor by reason of the fact
that he is or was our director, officer, employee, or agent or is or was serving at our
request as a director, officer, employee, or agent of another corporation, partnership,
joint venture, trust, or other enterprise against such costs and expenses, and to the
extent and in the manner provided under Delaware law.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our Bylaws provide
that the extent, amount and eligibility for the indemnification provided therein will be
made by our Board of Directors. Such determinations will be made by a majority vote of a
quorum consisting of directors who were not parties to such action, suit, or proceeding or
by our shareholders by a majority vote of a quorum consisting of shareholders who were not
parties to such action, suit, or proceeding.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">We are also
authorized by our Bylaws to make further indemnification as provided under Delaware law
except to indemnify any person against gross negligence or willful misconduct. </font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be permitted
to directors, officers or persons controlling us pursuant to the foregoing provisions, or
otherwise, we have been advised that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable.</font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
25. Other Expenses of Issuance and Distribution</strong></font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth an itemization of all estimated expenses, all of which we will
pay, in connection with the issuance and distribution of the securities being registered:</font></p>
<div align="center"><center>

<table cellpadding="0" cellspacing="0" width="60%">
  <tr>
    <td align="left" valign="bottom" width="75%" style="border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="Times New Roman"><strong><p><font size="1">Nature of Expense </font></strong></font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff thin solid" height="0%"></td>
    <td colspan="2" valign="bottom" width="22%" style="border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font style="Times New Roman"><strong><p align="right"><font size="1">Amount
    </font></strong></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="75%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>SEC
    Registration fee </font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ccffcc" height="0%" valign="middle"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="21%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>163.34 &nbsp; </font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="75%" style="BORDER-BOTTOM: #ffffff" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Accounting
    fees and expenses </font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0%" valign="middle"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ffffff" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="21%" style="BORDER-BOTTOM: #ffffff" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>4,000.00*</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="75%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Legal
    fees and expenses </font></p>
    </div></td>
    <td width="2%" style="BORDER-BOTTOM: #ccffcc" height="0%" valign="middle"></td>
    <td align="left" valign="middle" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="21%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>20,500.00*</font></p>
    </div></td>
  </tr>
  <tr>
    <td align="left" valign="middle" width="75%" style="BORDER-BOTTOM: #ffffff" height="0%"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Miscellaneous
    expenses</font></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0%"></td>
    <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ffffff" height="0%"><font
    size="2">$</font></td>
    <td align="right" valign="middle" width="21%" style="border-bottom: 1px solid rgb(0,0,0)"
    height="0%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">500.00*</font></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td align="left" valign="middle" width="75%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"></div></td>
    <td width="2%" style="BORDER-BOTTOM: #ffffff" height="0%"></td>
    <td align="left" valign="bottom" width="1%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p><font size="2">$</font></font></p>
    </div></td>
    <td align="right" valign="middle" width="21%" style="BORDER-BOTTOM: #ccffcc" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0px; TEXT-INDENT: 0px; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0px"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>25,163.34*</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td align="left" valign="middle" width="75%"><div
    style="MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><p><font size="1">*
    Estimated</font></p>
    </div></td>
    <td width="2%"></td>
    <td align="left" valign="bottom" width="1%"></td>
    <td align="right" valign="bottom" width="21%"></td>
  </tr>
</table>
</center></div></div>

<p><br clear="all" style="page-break-before:always; mso-break-type:section-break">
</p>
<div>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
26. Recent Sales of Unregistered Securities.</strong></font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The following
information is given with regard to unregistered securities sold by us during the past
three years, including the dates and amounts of securities sold, the persons to whom we
sold the securities, the consideration received in connection with such sales and, if the
securities were issued or sold other than for cash, the description of the transaction and
the type and amount of consideration received. </font></p>

<table cellpadding="0" cellspacing="0" width="100%" height="126">
  <tr>
    <td valign="middle" width="12%" style="BORDER-BOTTOM: black thin solid" height="0%"><div
    style="align=" center"><font style="Times New Roman"><strong><p><font size="1">Date</font></strong></font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="middle" width="12%" style="BORDER-BOTTOM: black thin solid" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font style="Times New Roman"><strong><p><font size="1">Title</font></strong></font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="middle" width="19%" style="BORDER-BOTTOM: black thin solid" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font style="Times New Roman"><strong><p><font size="1">Amount of
    Securities Sold </font></strong></font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="middle" width="13%" style="BORDER-BOTTOM: black thin solid" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font style="Times New Roman"><strong><p align="left"><font size="1">Persons</font></strong></font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="middle" width="36%" style="BORDER-BOTTOM: black thin solid" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font style="Times New Roman"><strong><p><font size="1">Cash or Non-Cash
    Consideration </font></strong></font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>12/22/04 </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Preferred Stock </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="19%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>480,000</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="13%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p align="left">Ivo
    Heiden</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td align="left" valign="top" width="36%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Private
    Sale at $.0001 per share. </font><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="1">(1)</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>12/22/04 </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Preferred Stock </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="19%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>360,000</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="13%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p align="left">Juergen
    Heiden</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td align="left" valign="top" width="36%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Private
    Sale at $.0001 per share. </font><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="1">(1)</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ccffcc">
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>10/04/05 </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common Stock </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="19%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>4,000,000</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="13%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p align="left">Richard
    Rubin</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td align="left" valign="top" width="36%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Private
    Sale at $.0001 per share.</font></p>
    </div></td>
  </tr>
  <tr bgcolor="#ffffff">
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>10/05/05 </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="12%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common Stock </font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="19%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>55,000,000</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td valign="top" width="13%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p align="left">Ivo
    Heiden</font></p>
    </div></td>
    <td width="2%" height="0%"></td>
    <td align="left" valign="top" width="36%" height="0%"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Conversion
    of debt into equity at $.0001</font></p>
    </div></td>
  </tr>
  <tr>
    <td valign="top" width="12%" height="0%" bgcolor="#ccffcc"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>03/28/06 </font></p>
    </div></td>
    <td width="2%" height="0%" bgcolor="#ccffcc"></td>
    <td valign="top" width="12%" height="0%" bgcolor="#ccffcc"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>Common Stock </font></p>
    </div></td>
    <td width="2%" height="0%" bgcolor="#ccffcc"></td>
    <td valign="top" width="19%" height="0%" bgcolor="#ccffcc"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>600,000</font></p>
    </div></td>
    <td width="2%" height="0%" bgcolor="#ccffcc"></td>
    <td valign="top" width="13%" height="0%" bgcolor="#ccffcc"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="center"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p align="left">Richard
    Rubin</font></p>
    </div></td>
    <td width="2%" height="0%" bgcolor="#ccffcc"></td>
    <td align="left" valign="top" width="36%" height="0%" bgcolor="#ccffcc"><div
    style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt"
    align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><p>For
    services provided valued at $18,000.</font></p>
    </div></td>
  </tr>
  <tr>
    <td valign="top" width="100%" height="0%" colspan="9"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">(1) The
    Registrant sold a total of 840,000 Series B Convertible Preferred Stock, which shares were
    converted into 16,800,000 restricted shares of common stock on October 4, 2005.</font></td>
  </tr>
</table>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For each of the
above issuances and sales, we relied upon Section 4(2) of the Securities Act of 1933, as
amended, as the basis for the exemption from registration requirements and there was no
public solicitation involved. The shares of restricted common stock were sold to private
investors. All recipients either received adequate information about us or had access,
through employment or other relationships, including business and personal relationships
with our management to such information. </font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
27. Exhibits.</strong></font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following exhibits are included as part of this Form SB-2. References to &quot;the
Company&quot; in this Exhibit List mean Zaxis International Inc., a Delaware corporation. </font></p>

<table border="0" cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td width="8%"><font style="Times New Roman" size="1"><strong>Exhibit No.</strong></font></td>
    <td width="92%"><p align="center"><font style="Times New Roman" size="1"><strong>Description
    </strong></font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">2.1</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Order
    confirming sale of debtor's interest in personal property (Incorporated by reference to
    Form 8-k (File No. 0-15476), filed with the SEC on December 8, 2004).</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">3.1</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Certificate
    of Incorporation, as amended (Incorporated by reference to Form 10-KSB (File No. 0-15476),
    filed with the SEC on April 15, 1995).</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">3.1(i)</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Certificate
    of Amendment to the Certificate of Incorporation. (Incorporated by reference to Form 8-k
    (File No. 0-15476), filed with the SEC on December 8, 2004).</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">3.2</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Restated
    Bylaws (Incorporated by reference to Form 10-KSB (File No. 0-15476), filed with the SEC on
    March 24, 2006).</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">5.1 </font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Opinion and
    Consent of Lawrence R. Lonergan, P.C., filed herewith.</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">23.1</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Consent of
    Michael F. Cronin, CPA, filed herewith.</font></td>
  </tr>
  <tr>
    <td width="8%"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
    size="1">23.2</font></td>
    <td width="92%"><font
    style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="1">Consent of
    Lawrence R. Lonergan, P.C. (included in Exhibit 5.1).</font></td>
  </tr>
</table>

<p><strong><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman"
size="2">Item 28. Undertakings. </font></strong></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman" size="2">The
undersigned Registrant hereby undertakes to:</font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">(1) </font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">File, during any
period in which offers or sales are being made, a post-effective amendment to this
registration statement to:</font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(i)
Include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as
amended (the &quot;Securities Act&quot;); <br>
(ii) Reflect in the prospectus any facts or events which, individually or together,
represent a fundamental change in the information in the registration statement;<br>
(iii) Include any additional or changed material information on the plan of distribution.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(2)</font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For determining
liability under the Securities Act, treat each post-effective amendment as a new
registration statement of the securities offered, and the offering of the securities at
that time to be the initial bona fide offering.</font></p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(3) </font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">File a
post-effective amendment to remove from registration any of the securities that remain
unsold at the end of the offering.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(4) </font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For determining
liability of the undersigned small business issuer under the Securities Act to any
purchaser in the initial distribution of the securities, the undersigned undertakes that
in a primary offering of securities of the undersigned small business issuer pursuant to
this registration statement, regardless of the underwriting method used to sell the
securities to the purchaser, if the securities are offered or sold to such purchaser by
means of any of the following communications, the undersigned small business issuer will
be a seller to the purchaser and will be considered to offer or sell such securities to
such purchaser:</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(i) </font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any preliminary
prospectus or prospectus of the undersigned small business issuer relating to the offering
required to be filed pursuant to Rule 424;<br>
(ii)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any free writing
prospectus relating to the offering prepared by or on behalf of the undersigned small
business issuer or used or referred to by the undersigned small business issuer;<br>
(iii)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The portion of any
other free writing prospectus relating to the offering containing material information
about the undersigned small business issuer or its securities provided by or on behalf of
the undersigned small business issuer; and<br>
(iv)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any other
communication that is an offer in the offering made by the undersigned small business
issuer to the purchaser.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(5) </font><font
id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&nbsp;</font><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For determining any
liability under the Securities Act, treat each post-effective amendment that contains a
form of prospectus as a new registration statement for the securities offered in the
registration statement, and that offering of the securities at that time as the initial
bona fide offering of those securities. </font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Insofar as
indemnification for liabilities arising under the Securities Act may be permitted to
directors, officers and controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.</font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In the event that a
claim for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.</font></p>

<p align="center"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SIGNATURES</strong></font></p>

<p style="text-align: justify"><font
style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In accordance with
the requirements of the Securities Act of 1933, the registrant certifies that it has
reasonable grounds to believe that it meets all of the requirements of filing on SB-2 and
authorized this registration statement to be signed on its behalf by the undersigned, in
New York, New York on May 16, 2006.</font></p>

<table align="center" bgcolor="#ffffff" border="0" cellpadding="0" cellspacing="0"
width="100%">
  <tr valign="top" bgcolor="#ffffff">
    <td width="50%"></td>
    <td width="49%"><font size="2">Zaxis International Inc.</font></td>
  </tr>
  <tr valign="top" bgcolor="#ffffff">
    <td><font size="2">&nbsp; </font></td>
    <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2"><strong>By:</strong>
    /s/ Ivo Heiden</font></td>
  </tr>
  <tr valign="top" bgcolor="#ffffff">
    <td></td>
    <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2"><strong>Title:</strong>
    President, CFO and sole Director</font></td>
  </tr>
  <tr>
    <td></td>
    <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman" size="2"><strong>Date:</strong>
    May 16, 2006</font></td>
  </tr>
</table>

<p>&nbsp;</p>

<p><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
accordance with the requirements of the Securities Act of 1933, this registration
statement was signed by the following persons in the capacities and on the dates stated:</font></p>

<p>&nbsp;</p>

<table border="0" cellpadding="0" cellspacing="0" width="100%">
  <tr>
    <td width="33%"><p align="left"><font size="2"><font
    style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Signature: </strong></font>/s/
    Ivo Heiden</font></td>
  </tr>
  <tr>
    <td width="33%"><font size="2"><strong>Title:</strong> President, CFO and sole Director</font></td>
  </tr>
  <tr>
    <td width="33%"><font size="2"><strong>Date:</strong> May 16, 2006</font></td>
  </tr>
</table>

<p>&nbsp;</p>
</div>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5
<SEQUENCE>2
<FILENAME>exh_5.htm
<DESCRIPTION>EXHIBIT 5
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<b><font FACE="Century Schoolbook" SIZE="6">

<p ALIGN="CENTER"></font><font face="Century Schoolbook" size="4">LAWRENCE R. LONERGAN,
P.C.<br>
</font><font face="Century Schoolbook" size="3">ATTORNEYS AT LAW</font></b></p>

<p ALIGN="CENTER"><font FACE="Century Schoolbook" SIZE="2"><b>275 SEVENTH AVENUE, 25<sup>TH</sup>
FLOOR<br>
NEW YORK, NEW YORK 10001<br>
PHONE: (212) 206-9071<br>
FAX: (212) 366-6950<br>
E-mail: llonergan1@aol.com</p>
</b></font>

<p ALIGN="JUSTIFY"><font size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp
;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
April 3, 2006</font></p>
<u><b>

<p ALIGN="JUSTIFY"><font size="2">VIA ELECTRONIC TRANSMISSION</font></p>
</b></u>

<p ALIGN="JUSTIFY"><font size="2">Securities and Exchange Commission<br>
100 F Street, N.E.<br>
Washington, DC 20549<br>
</font></p>

<p ALIGN="JUSTIFY"><font size="2">RE: Zaxis International Inc.</font></p>

<p ALIGN="JUSTIFY"><u><font size="2">Registration Statement on Form SB-2</font></p>
</u>

<p ALIGN="JUSTIFY"><font size="2">Ladies and Gentlemen:</font></p>

<p ALIGN="JUSTIFY"><font size="2">I refer to the above-captioned registration statement on
Form SB-2 (the &quot;Registration Statement&quot;) under the Securities Act of 1933, as
amended (the &quot;Act&quot;). The Registration Statement is being filed with the
Securities and Exchange Commission by Zaxis International Inc., a Delaware corporation
(the &quot;Company&quot;), to register the sale by selling shareholders of 76,400,000
shares of the Company&#146;s common stock.</font></p>

<p ALIGN="JUSTIFY"><font size="2">I have examined the originals, photocopies, certified
copies or other evidence of such records of the Company, certificates of officers of the
Company and public officials, or other documents as we have deemed relevant and necessary
as a basis for the opinion hereinafter expressed. In such examination, I have assumed the
genuineness of all signatures, the authenticity of all documents submitted to me as
certified copies or photocopies and the authenticity of the originals of such latter
documents.</font></p>

<p ALIGN="JUSTIFY"><font size="2">Based on my examination mentioned above, I am of the
opinion that the shares of common stock being sold by the selling shareholders pursuant to
the Registration Statement are legally and validly issued, fully paid and non-assessable.</font></p>

<p ALIGN="JUSTIFY"><font size="2">I hereby consent to the filing of this opinion as
Exhibit 5.1 to the Registration Statement and to the reference to my firm under
&quot;Legal Matters&quot; in the related Prospectus. In giving the foregoing consent, I do
not hereby admit that I am in the category of persons whose consent is required under
Section 7 of the Act, or the rules and regulations of the Securities and Exchange
Commission.</font></p>

<p ALIGN="JUSTIFY"><font size="2">Please refer further questions or inquiries in this
regard to the undersigned. Thank you.</font></p>

<p ALIGN="JUSTIFY"><font size="2">Very truly yours,</font></p>

<p ALIGN="JUSTIFY"><font size="2">/s/ Lawerence R. Lonergan, PC</font></p>
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<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>3
<FILENAME>exh_23.htm
<DESCRIPTION>EXHIBIT 23
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<p ALIGN="JUSTIFY">Exhibit 23.1</p>

<p ALIGN="CENTER">INDEPENDENT AUDITORS&#146; CONSENT</p>

<p align="center">&nbsp;Michael F. Cronin, CPA<br>
687 Lee Road, Ste 210<br>
Rochester, NY 14606<br>
407-754-7027<br>
email <u>mikeccpa@aol.com</u></p>

<p align="center">&nbsp;<strong>CONSENT OF INDEPENDENT AUDITORS </strong></p>

<p>&nbsp;The Board of Directors<br>
Zaxis International Inc.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nb
sp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
May 16, 2006</p>

<p>&nbsp;&nbsp;&nbsp;We consent to incorporation by reference in the Form&nbsp;SB-2
Registration Statement of Zaxis International, Inc. of our report dated March 24, 2006
relating to the balance sheet of Zaxis International, Inc. as of December&nbsp;31, 2005
and 2004 and the related statements of operations, stockholders' equity and cash flows for
the years ended December&nbsp;31, 2005 and 2004, which report appears in the Annual Report
on Form&nbsp;10-KSB of Zaxis International Inc. and to the reference to our firm under the
heading &quot;Experts&quot; in the prospectus.</p>

<p>May 16, 2006</p>

<p>/s/ Michael F. Cronin<br>
Michael F. Cronin<br>
Certified Public Accountant</p>
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