10-Q 1 f10q0609_echo.htm QUARTERLY REPORT FOR THE PERIOD ENDING 06/09 f10q0609_echo.htm
 


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

Form 10-Q

(Mark one)
[X]  Quarterly  Report Under Section 13 or 15(d) of The Securities  Exchange Act of 1934

For the quarterly period ended June 30, 2009
 
[_]  Transition Report Under Section 13 or 15(d) of The Securities  Exchange Act of 1934

For the transition period from ______________ to _____________

Commission file number 000-26703

ECHO RESOURCES, INC.

(Exact name of registrant as specified in its charter)
 
Delaware
 
000-26703
 
98-0206030
         
(State or other jurisdiction
of incorporation)
 
(Commission
file number)
 
(IRS Employer
Identification No.)
 
500 Australian Avenue South, Suite 700
West Palm Beach FL33401

(Address of principal executive offices)(Zip Code)
 
Registrant's telephone number, including area code: (561) 616-4146
 
N/A

(Former name or former address, if changes since last report)



Indicate by check mark whether the issuer (1) has filed all reports  required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_|.

Indicate by check mark whether the registrant is an accelerated filer, a non-accelerated filer, or a smaller reporting company.
Large accelerated filer |_|
Accelerated filer |_|
Non-accelerated filer  |_|
Smaller reporting company  |X|

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 
  |X| Yes
|_| No

APPLICABLE ONLY TO CORPORATE ISSUERS



State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:

As of July 27, 2009,  there were  approximately  5,539,040  shares of the Issuer's common stock, par value $0.00005 per share outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this quarterly report on Form 10-Q contain or may contain forward-looking  statements that are subject to known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  These forward-looking statements were based on various factors and were derived utilizing  numerous assumptions and other factors that could cause our actual results to differ materially from those in the forward-looking statements. These factors include, but are not limited to,  economic, political and market conditions and fluctuations, government and industry regulation,  interest rate risk, U.S. and global competition, and other factors including the risk factors set forth in our Form 10-KSB. Most of these factors are difficult to predict accurately and are generally beyond our control. You should consider the areas of risk described in connection with any forward-looking statements that may be made herein. Readers are cautioned not to place  undue reliance on these forward-looking statements, which speak only as of the date of this  report. Readers should carefully review this quarterly report in its entirety, including but not limited to our financial statements and the notes thereto. Except for our ongoing  obligations to  disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated  events. For any forward-looking statements contained in any document, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

 

 
INDEX


Financial Statements

Item 2
Management's Discussion and Analysis or Plan of Operations

Item 3
Quantitative and Qualitative Disclosures About Market Risk

Item 4T.
Controls and Procedures
 


Item 1
Legal Proceedings

Item 1A.
Risk Factors

Item 2
Unregistered Sales of Equity Securities and Use of Proceeds

Item 3
Defaults Upon Senior Securities

Item 4
Submission of Matters to a Vote of Security Holders

Other Information

Item 6
Exhibits

SIGNATURES

EXHIBITS









INDEX TO FINANCIAL STATEMENTS


Balance Sheet                                                                                                                                          
F-2
   
Statements of Operations                                                                                                                                          
F-3
   
Statements of Stockholders’ Equity                                                                                                                                          
F-4
   
Statements of Cash Flows                                                                                                                                          
F-5
   
Notes to Financial Statement                                                                                                                                          
F-6





F-1

 


Echo Resources, Inc.
(a development stage enterprise)
Balance Sheet


   
June 30, 2009
   
December 31, 2008
 
   
(Unaudited)
       
ASSETS
           
CURRENT ASSETS
           
  Cash
  $ 18,611     $ 14,371  
  Accounts receivable
    0       0  
                 
          Total current assets
    18,611       14,371  
                 
OTHER ASSETS
               
   Mining claim interest
    0       0  
                 
          Total other assets
    0       0  
                 
Total Assets
  $ 18,611     $ 14,371  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
CURRENT LIABILITIES
               
  Accounts payable
               
     Accrued interest
  $ 49,799     $ 42,627  
     Note payable
    193,960       175,137  
                 
          Total current liabilities
    243,759       217,764  
                 
Total Liabilities
    243,759       217,764  
                 
STOCKHOLDERS’ EQUITY
               
  Preferred stock, $0.0001 par value, 10,000 shares authorized,
       0 issued and outstanding
    0       0  
  Common stock, $0.00005 par value, authorized 49,990,000 shares;
      5,539,040 issued and outstanding
    277       277  
  Additional paid-in capital
    415,810       415,810  
  Deficit accumulated during the development stage
    (641,235 )     (619,480 )
                 
          Total stockholders’ equity
    (225,148 )     (203,393 )
                 
Total Liabilities and  Stockholders’ Equity
  $ 18,611     $ 14,371  


The accompanying notes are an integral part of the financial statements


F-2

 
Echo Resources, Inc.
(a development stage enterprise)
Statements of Operations
Six Months Ended June 30,
(unaudited)


   
 
Three Months
Ended June 30,
   
 
Six Months
Ended June 30,
 
   
2009
   
2008
   
2009
   
2008
 
                         
                         
REVENUES
  $ 0     $ 0     $ 0     $ 0  
                                 
OPERATING EXPENSES
                               
   General and administrative
    2,046       1,409       10,446       5,099  
   Professional fees
    3,565       2,000       15,315       13,000  
                                 
          Net operating loss
    5,611       3,409       25,761       18,099  
                                 
   Interest expense
    6       10,523       25,994       26,478  
                                 
                                 
Net loss
  $ (5,617 )   $ (13,932 )   $ (51,755 )   $ (44,577 )
                                 
Basic net loss per share
  $ (0.00 )   $ (0.00 )   $ (0.01 )   $ (0.01 )
                                 
Weighted average shares outstanding
    5,539,040       5,539,040       5,539,040       5,539,040  


The accompanying notes are an integral part of the financial statements




F-3



 



Echo Resources, Inc.
(a development stage enterprise)
 Statement of Stockholders’ Equity (Deficit)

   
 
 
 
 
Number of
Shares
   
 
 
 
 
Common
Stock
   
 
 
 
Additional
Paid-in Capital
   
 
Deficit
Accumulated
During the
Development
Stage
   
 
 
 
Total
Stockholders’
Equity
 
                               
BEGINNING BALANCE, January 1, 2005
    5,539,040     $ 277     $ 415,810     $ (292,280 )   $ 123,807  
                                         
Net loss
    0       0       0       (187,537 )     (187,537 )
                                         
BALANCE, December 31, 2005
    5,539,040       277       415,810       (479,817 )     (63,730 )
Beneficial Conversion Feature Discount
    0       0       0       15,000       15,000  
Net loss
    0       0       0       (79,450 )     (79,450 )
                                         
BALANCE, December 31, 2006
    5,539,040       277       415,810       (544,267 )     (128,180 )
Beneficial Conversion Feature Discount
    0       0       0       47,000       47,000  
Net loss
    0       0       0       (78,730 )     (78,730 )
                                         
BALANCE, December 31, 2007
    5,539,040       277       415,810       (563,388 )     (147,301 )
Beneficial Conversion Feature Discount
    0       0       0       35,001       35,001  
Net loss
    0       0       0       (91,093 )     (91,093 )
                                         
BALANCE, December 31, 2008
    5,539,040       277       415,810       (619,480 )     (203,393 )
Beneficial Conversion Feature Discount
    0       0       0       30,000       30,000  
Net loss
    0       0       0       (51,755 )     (51,755 )
                                         
ENDING BALANCE, June 30, 2009 (unaudited)
    5,539,040     $ 277     $ 415,810     $ (641,235 )   $ (225,148 )
                                         
                                         
                                         
                                         
                                         
                                         
                                         


The accompanying notes are an integral part of the financial statements
 
F-4


 

Echo Resources, Inc.
(a development stage enterprise)
Statements of Cash Flows
Six Months Ended June 30,
(Unaudited)

   
2008
   
2007
 
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
  $ (51,755 )   $ (44,577 )
Adjustments to reconcile net loss to net cash used by operating activities:
               
        Amortization of beneficial conversion feature discount
    18,823       20,619  
Changes in operating assets and liabilities
               
        Increase (decrease) in accounts payable - trade
    0       0  
        Increase (decrease) in accrued interest expense
    7,172       5,858  
                 
Net cash provided (used) by operating activities
    (25,760 )     (18,100 )
                 
CASH FLOWS FROM INVESTING ACTIVITIES:
               
 Deposit on options
    0       0  
                 
Net cash provided (used) by investing activities
    0       0  
                 
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from stockholder loan payable
    0       0  
Proceeds from note payable
    30,000       20,000  
                 
Net cash provided by financing activities
    30,000       20,000  
                 
Net increase (decrease) in cash
    4,240       1,900  
                 
CASH, beginning of period
    14,371       19,846  
                 
CASH, end of period
  $ 18,611     $ 21,746  
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
               
Non-Cash Financing Activities:
               
   Exchange of assets for reduction in notes payable
  $ 0     $ 0  


The accompanying notes are an integral part of the financial statements


F-5


Echo Resources, Inc.
(a development stage enterprise)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)

Note 1 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 
(a) The Company Echo Resources, Inc. is a Delaware chartered development stage corporation which conducts business from its headquarters in West Palm Beach, Florida.

The following summarize the more significant accounting and reporting policies and practices of the Company:

 
(b) Use of estimates  The financial statements have been prepared in conformity with generally accepted accounting principles.  In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statements of financial condition and revenues and expenses for the year then ended.  Actual results may differ significantly from those estimates.

 
(c) Start-up costs  Costs of start-up activities, including organization costs, are expensed as incurred, in accordance with Statement of Position (SOP) 98-5.

(d) Stock compensation for services rendered The Company may issue shares of common stock in exchange for services rendered.  The costs of the services are valued according to generally accepted accounting principles and have been charged to operations.

 
(e) Net income (loss) per share Basic loss per share is computed by dividing the net income (loss) by the weighted average number of common shares outstanding during the period.

(f) Property and equipment All property and equipment are recorded at cost and depreciated over their estimated useful lives, using the straight-line method.  Upon sale or retirement, the cost and related accumulated depreciation are eliminated from their respective accounts, and the resulting gain or loss is  included in the results of operations.  Repairs and maintenance charges, which do not increase the useful lives of the assets, are charged to operations as incurred.

(g)  Interim financial information The financial statements for the six months ended June 30, 2009 and 2008 are unaudited and include all adjustments which in the opinion of management are necessary for fair presentation, and such adjustments are of a normal and recurring nature. The results for the six months are not indicative of a full year results.

NOTE 2 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.  The Company’s financial position and operating results raise substantial doubt about the Company’s ability to continue as a going concern, as reflected by the net loss of $641,235 accumulated through June 30, 2009.  The ability of the Company to continue as a going concern is dependent upon commencing operations, developing sales and obtaining additional capital and financing.  The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.  The Company is currently seeking additional capital to allow it to begin its planned operations

NOTE 3 - NOTES PAYABLE

In September 2004,  Echo issued a convertible  promissory note to allow advances up to $100,000.  As of September 30, 2005, $100,000 had been advanced to the company. The note bears seven percent interest,  is convertible at the lender's option at $2 per share, and is payable in one year. The lender has agreed to a third extension of  the maturity date for an additional year, to September 2008. The note has been discounted for its beneficial  conversion feature,  which will be amortized over the life of the note. A summary of the notes is as follows:

F-6


Echo Resources, Inc.
(a development stage enterprise)
NOTES TO FINANCIAL STATEMENTS

NOTE 3 - NOTES PAYABLE, continued

In September 2005, the Company issued another convertible promissory note with exactly the same terms as the first note, principal up to $100,000, interest at 7%, maturity in one year and convertible at the lenders option at $2 per share. At December 31, 2006, $65,000 had been advanced under this note. $22,000 was advanced under this note through the first half of 2007. The Company sold its mining claim interest to this creditor for a reduction of the promissory note balance in the amount of $50,000 in the third quarter of 2007. $25,000 was advanced under this loan at the end of the third quarter of 2007. The note was due September 30, 2006 and a one year extension of the due date to September 30, 2008, has been received.

The second note has been discounted for its beneficial  conversion feature,  which will be amortized over the life of the note. A summary of the notes follows.


On December 29, 2008, the Company and the lender entered into an extension and modification of the two notes, into 1 note with a new maturity of December 31, 2010 and an increase of the principal balance from a combined $200,000 to a total of $400,000.
 
   
Notes Payable
 
       
Gross proceeds from notes
  $ 277,000  
    Less: Loan set-off
    (50,000 )
Less: Beneficial conversion feature
    (227,000 )
Add: Amortization of discount
    193,960  
         
        Value of note on June 30, 2009
  $ 193,960  
         
 
NOTE 4 – CASH AND CASH EQUIVALENTS

For purposes of the statement of cash flows, the Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents
 
 
F-7


 
NOTE 5 – USE OF ESTIMATES

The financial statements have been prepared in conformity with accounting principles generally accepted in the United States. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the statements of financial condition and revenues and expenses for the year then ended. Actual results may differ significantly from those estimates.

NOTE 6 - NON-CASH TRANSACTIONS

In the third quarter of 2007, the Company sold the mining claim to the holder of its notes payable in exchange for a reduction in the outstanding balance of the notes payable in the amount of $50,000. The Company recorded no gain or loss on this transaction.


 
 
 
 
 

 
F-8

 
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations

The following  discussion and analysis  should be read in conjunction  with our Financial Statements and Notes thereto appearing elsewhere in this Report on Form 10-Q as well as our other SEC filings.

Overview

The Company is a development stage company and has not yet generated or realized any  revenues  from  business  operations.  The  Company's business  strategy changed in the third quarter 2007 to seeking potential merger candidates.  The  Company's  auditors  have issued a going concern  opinion in our audited  financial  statements for the fiscal year ended December 31, 2007. This means that our auditors  believe there is doubt that the Company can continue as an on-going  business for the next twelve  months unless it obtains  additional capital to pay its bills. This is because the Company has not  generated  any  revenues and no revenues  are currently anticipated. Accordingly, we must raise cash from sources such as investments by others in the Company and through possible  transactions  with strategic or joint venture partners. We do not  plan  to use any capital raised for the purchase or sale of any plant or  significant  equipment. The following  discussion and analysis  should be read in  conjunction  with the financial  statements  of the  Company  and  the  accompanying  notes  appearing subsequently under the caption "Financial Statements."

Comparison of Operating Results for the Quarter Ended June 30, 2009 to the Quarter Ended June 30, 2008

Revenues

The Company did not  generate  any revenues from operations for the three months ended June 30, 2009 or 2008. Accordingly,  comparisons with prior periods are not meaningful.  The Company is subject to risks  inherent in the  establishment  of a new business  enterprise, including limited capital  resources and cost  increases  in services.

Operating Expenses

Operating  expenses increased by $2,202 from $3,409 for the three months ended June 30, 2008 to $5,611 for the three months ended June 30, 2009. The increase in our net operating expenses is due to increased professional fees expenses incurred.

Interest Expense

Interest expense for the three months ended June 30, 2009 and 2008 was $6 and $10,523, respectively. The decrease is due to a correction in beneficial conversion discount amortization.

1


Net Income/Loss

Net loss decreased by $8,321 from net loss of $13,932 for the three months ended June 30, 2008 to a net loss of $5,611 for the three months ended June 30, 2009. The decrease in net operating loss is due to the correction in amortization of beneficial conversion feature for convertible notes.

At June 30, 2009, our accumulated deficit was $641,235.

Assets and Liabilities

Our total assets were  $18,611 at June 30, 2009.  Our assets consist of cash of $18,611.

Total Current  Liabilities  are $243,759 at June 30, 2009.  Our notes payable  are for  $227,000. The notes were  discounted  by  $227,000  for their beneficial conversion features. At June 30, 2009, $193,960 of the discount has been amortized.

Financial Condition, Liquidity and Capital Resources

At June 30, 2009, we had cash and cash equivalents of $18,611. Our working capital is presently minimal and there can be no assurance that our financial condition will improve. To date, we have not generated cash flow from operations. Consequently, we have been dependent upon a third party non-affiliate, Confederated Finance Corp. ("Confederated"), to fund our cash requirements. Specifically, we have entered into two Convertible Promissory Notes ("Notes") with Confederated for the principal sum or so much of the principal sum of Two Hundred Thousand Dollars ($200,000) as may from time to time have been advanced and be outstanding, together with accrued interest at the rate of 7% per annum. The entire unpaid balance of principal(subject to conversion of such principal as provided in the Note) and all accrued and unpaid interest shall be due and payable on the day prior to the first anniversary of the Effective Date of the Note.

As of June 30, 2009, we had a working capital deficit of $225,148. At June 30, 2009, we had no outstanding  debt other than  convertible  notes payable to Confederated  and accrued interest payable on the Notes. The Company will seek funds from possible strategic  and joint  venture  partners  and  financing  to cover any short term operating deficits and provide for long term working capital.  No assurances can be given that the Company will  successfully  engage  strategic or joint venture partners or otherwise obtain sufficient financing through the sale of equity.

No trends have been identified which would materially  increase or decrease our results of operations or liquidity.

We have short-term liquidity problems that will be addressed by the Convertible Note, which we have a balance of $173,000 to draw for working capital. For long-term liquidity, we believe that we will need to raise additional capital to remain an ongoing concern; however, as stated above no commitments have been made as of this date.
 
Comparison  of  Operating  Results for the  Six Months  Ended June 30, 2009 to the Six Months Ended June 30, 2008

2

 
Revenues

The Company did not  generate  any revenues from operations for the six months ended June 30, 2009 or 2008. Accordingly,  comparisons with prior periods are not meaningful.  The Company is subject to risks  inherent in the  establishment  of a new business  enterprise, including limited capital  resources and cost  increases  in services.

Operating Expenses
     Operating  expenses increased  by $7,662 from $18,099 for the six  months ended June 30, 2008 to $25,761 for the six months  ended June 30, 2009.  The increase in our operating expenses is due to increased  professional fees and general expenses we incurred for the six months ended June 30, 2009.

Interest Expense
     Interest expense for the six months ended June 30, 2009, and 2008 was $25,994 and $26,478 respectively. The decrease in our interest expense is due to the amortization of the beneficial  conversion feature  of the  convertible promissory note entered into with Confederated Finance Corp. ("Convertible Note").

Net Income/Loss

     Net loss increased by $7,178 from net loss of $44,577 for the six months ended June 30, 2008 to a net loss of $51,755 for the six  months  ended June 30, 2009.  The increase in net operating  loss is due to the increase in the amortization  of  beneficial conversion feature for convertible notes, increased professional fees and general expenses.

At June 30, 2009, our accumulated deficit was $641,235.

Assets and Liabilities

Our total assets were  $18,611 at June 30, 2009.  Our assets consist of cash of $18,611.

Total Current  Liabilities  are $243,759 at June 30, 2009.  Our notes payable  are for  $227,000. The notes were  discounted  by  $227,000  for their beneficial conversion features. At June 30, 2009, $193,960 of the discount has been amortized.

Financial Condition, Liquidity and Capital Resources
 
 
3


 
At June 30, 2009, we had cash and cash equivalents of $18,611. Our working capital is presently minimal and there can be no assurance that our financial condition will improve. To date, we have not generated cash flow from operations. Consequently, we have been dependent upon a third party non-affiliate,  Confederated Finance Corp. ("Confederated"), to fund our cash  requirements.  Specifically,  we have  entered  into  two  Convertible Promissory Notes ("Notes") with Confederated for the principal sum or so much of the principal sum of Two Hundred Thousand Dollars ($200,000) as may from time to time have been advanced and be  outstanding,  together with accrued  interest at the rate of 7% per annum.  The entire  unpaid  balance of  principal(subject  to conversion of such principal as provided in the Note) and all accrued and unpaid interest  shall be due and payable on the day prior to the first  anniversary of  the Effective Date of the Note.

As of June 30, 2009, we had a working capital deficit of $225,148. At June 30, 2009, we had no outstanding  debt other than  convertible  notes payable to Confederated  and accrued interest payable on the Notes. The Company will seek funds from possible strategic  and joint  venture  partners  and  financing  to cover any short term operating deficits and provide for long term working capital.  No assurances can be given that the Company will  successfully  engage  strategic or joint venture partners or otherwise obtain sufficient financing through the sale of equity.

No trends have been identified which would materially  increase or decrease our results of operations or liquidity.

We have short-term liquidity problems that will be addressed by the Convertible Note, which we have a balance of $173,000 to draw for working capital. For long-term liquidity, we believe that we will need to raise additional capital to remain an ongoing concern; however, as stated above no commitments have been made as of this date.

Plan of Operation

The Company's  plan of operation  through  December 31, 2009 is to focus on finding a suitable merger candidate or a viable business plan. The Company is seeking to raise capital to implement the Company's  business  strategy.  In the event  additional  capital  is not  raised,  the  Company  may  seek  a  merger, acquisition or outright sale.

Critical Accounting Policies

Use of Estimates:  The  preparation  of financial  statements in conformity with accounting  principles  generally  accepted in the United States of America requires  management to make estimates and assumptions  that affect the reported amounts  of assets and  liabilities  and  disclosure  of  contingent  assets and liabilities at the date of the financial  statements and the reported amounts of revenues and expenses during the reporting  period.  Actual results could differ materially from those estimates.

Loss per share:  Basic loss per share excludes  dilution and is computed by dividing the loss  attributable to common  shareholders by the  weighted-average number of common  shares  outstanding  for the  period.  Diluted  loss per share reflects  the  potential  dilution  that  could  occur  if  securities  or other contracts to issue common stock were exercised or converted into common stock or resulted  in the  issuance of common  stock that  shared in the  earnings of the Company.  Diluted loss per share is computed by dividing  the loss  available to common  shareholders by the weighted average number of common shares outstanding for  the  period  and  dilutive   potential  common  shares  outstanding  unless consideration  of  such  dilutive   potential  common  shares  would  result  in anti-dilution.  Common stock  equivalents were not considered in the calculation of diluted loss per share as their effect would have been  anti-dilutive for the periods ended June 30, 2009 and 2008.

4

 
Going Concern.

The Company has suffered recurring losses from operations and is in serious need of  additional  financing.  These  factors  among others  indicate that the Company may be unable to continue as a going concern,  particularly in the event that it cannot  obtain  additional  financing or, in the  alternative,  affect a merger or  acquisition.  The Company's  continuation  as a going concern depends upon its ability to generate  sufficient cash flow to conduct its operations and its  ability  to  obtain  additional  sources  of  capital  and  financing.  The accompanying  financial  statements do not include any  adjustments  that may be necessary if the Company is unable to continue as a going concern.

Item 3 - Quantitative and Qualitative Disclosures About Market Risk

The Company is not subject to any specific market risk other than that encountered by any other public company related to being publicly traded.

Item 4T - Controls and Procedures

Our management, which includes our Chief Executive Officer who also serves as our principal financial officer, have conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-14(c) promulgated under the Securities and Exchange Act of 1934, as amended) as of a date (the "Evaluation Date") as of the end of the period covered by this report. Based upon that evaluation, our management has concluded that our disclosure controls and procedures are not effective for timely gathering, analyzing and disclosing the information we are required to disclose in our reports filed under the Securities Exchange Act of 1934, as amended, because of adjustments required by our independent auditors, primarily in the area of notes payable. Specifically, our independent auditors identified deficiencies in our internal controls and disclosures related to the valuation and amortization of beneficial conversion features on our notes payable. We have made the necessary adjustments to our financial statements and footnote disclosures in our Interim Report on Form 10-Q. We are in the process of improving our internal controls in an effort to remediate the deficiencies. There have been no significant changes made in our internal controls or in other factors that could significantly affect our internal controls subsequent to the end of the period covered by this report based on such evaluation.
 
 
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PART II
OTHER INFORMATION

Item 1   Legal Proceedings

None.


None.

Item 3   Defaults Upon Senior Securities

None

Item 4   Submission of Matters to a Vote of Security Holders

None
 

None

Item 6   Exhibits

(a) The following  sets forth those  exhibits filed pursuant to Item 601 of Regulation S-K:

Exhibit
number      Descriptions
 
31.1      * Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of  2002.
 
32.1      * Certification Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002.
__________
*    Filed herewith.


     (b) The following  sets forth the  Company's  reports on Form 8-K that have been filed during the quarter for which this report is filed:

     None.


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Pursuant  to the  requirements  of  Section  13 or 15(d) of the  Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
  Echo Resources, Inc.  
       
Date August 14, 2009
By:
/s/ Pieter DuRand  
    Pieter DuRand  
   
Chief Executive Officer,
President and Chairman of the Board*
 
       

 
*    Pieter  DuRand  has  signed  both on  behalf  of the  registrant  as a duly authorized officer and as the Registrant's principal accounting officer.

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