ASSETS

Current assets:

   Cash

Total assets

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current liabilities:

   Bank overdraft

   Accounts payable

   Accrued liabilities

   Advances from directors (Note 3)

Total liabilities

Contingencies and Commitments (Notes 1 and 5)

Stockholders’ deficit:

   Preferred stock, no par value; 10,000,000 shares authorized, no shares issued and outstanding

   Common stock, $0.001 par value; 50,000,000 shares authorized, 26,960,728 shares issued and outstanding (December 31, 2010 – 25,460,728)

   Common stock to be issued

   Additional paid-in capital

   Donated capital (Note 3)

   Accumulated deficit

Total stockholders’ deficit

Total liabilities and stockholders’ deficit

Expenses

   Donated rent (Note 3)

   General and administrative (Note 3)

   Interest expense

   Research and development

Total expenses

Net loss

Loss per share – basic and diluted

Weighted average shares outstanding

Cash flow from operating activities:

   Net loss

   Adjustments to reconcile net loss to net cash used in operating activities:

               Amortization of intangible asset

               Estimated fair value of common stock issued for patents

               Beneficial conversion of amounts due to related party

               Depreciation of property and equipment

               Estimated fair value of common stock issued for services

               Donated rent

   Changes in operating assets and liabilities:

               Accounts payable

               Accrued liabilities

   Net cash provided by (used in) operating activities

Cash flows from investing activities:

   Purchase of property and equipment

   Purchase of license

   Net cash used in investing activities

Cash flows from financing activities:

   Bank overdraft

   Advances from directors

   Proceeds from related party note payable

   Issuance of common stock for cash

   Net cash provided by (used in) financing activities

Net change in cash

Cash, beginning of period

Cash, end of period

Non-cash Financing Activities:

   Common stock issued upon conversion of amounts due to related parties

   Common stock to be issued or to be issued to settle accounts payable

   Common stock issued upon conversion of related party note payable

   Common stock issued for license

   Common stock issued in conversion of accounts payable

Nature of Operations and Going Concern

Salamon Group, Inc. (the "Company") was incorporated in the state of Nevada on April 27, 2001 (“Inception”). The Company is a development stage company whose principal business plan is to seek earnings by acquiring revenue producing assets in the field of solar energy. The Company is a development stage company as defined by Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 915, Development Stage Entities.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America applicable to a going concern. At March 31, 2011, the Company has no revenues to date, has accumulated losses of $1,235,593 since inception and a working capital deficit of $201,299 and expects to incur further losses in the development of its business, all of which cast substantial doubt about the Company’s ability to continue as a going concern.

Management plans to continue to provide for the Company's capital needs during the year ending December 31, 2011 by issuing debt and equity securities and by the continued support of its related parties (see Note 3). The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. There is no assurance that funding will be available to continue the Company’s business operations.

Summary of Significant Accounting Policies

Basis of presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States and are expressed in United States dollars. The Company’s fiscal year end is December 31.

Interim consolidated financial statements

The interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Securities and Exchange Commission (“SEC”) Form 10-Q. They do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these interim unaudited financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto for the year ended December 31, 2010, included in the Company’s Annual Report on Form 10-K filed on April 15, 2011 with the SEC.

The interim financial statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the Company’s financial position March 31, 2011, and the consolidated results of its operations and consolidated cash flows for the three months ended March 31, 2011 and March 31, 2010. The results of operations for the three months ended March 31, 2011 are not necessarily indicative of the results to be expected for future quarters or the full year ending December 31, 2011.

Summary of Significant Accounting Policies (continued)

Use of estimates

The preparation of financial statements in conformity with United States generally accepted accounting principles 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. The Company regularly evaluates estimates and assumptions related to deferred income tax asset valuation allowances, stock-based payments and financial instrument valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experience by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Foreign currency translation

The Company’s functional and reporting currency is the United States dollar. Monetary assets and liabilities denominated in foreign currencies are translated in accordance with ASC 830, Foreign Currency Translation Matters , using the exchange rate prevailing at the balance sheet date. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.

Basic and diluted net loss per share

The Company computes net loss per share in accordance with ASC 260, Earnings per Share, which requires presentation of both basic and diluted loss per share (“EPS”) on the face of the statement of operations. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of common shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period including stock options, using the treasury stock method, convertible preferred stock, and convertible debt, using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all potentially dilutive common shares if their effect is antidilutive. At March 31, 2011 and December 31, 2010, there were no potentially dilutive instruments outstanding.

Income taxes

The Company accounts for income tax using the asset and liability method in accordance with ASC 740, Income Taxes. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

Summary of Significant Accounting Policies (continued)

Financial instruments

Pursuant to ASC 820, Fair Value Measurements and Disclosures and ASC 825, Financial Instruments, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value using a hierarchy based on the level of independent, objective evidence when measuring fair value using a hierarch based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization with the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy prioritized the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments consist principally of accounts payable, and advances from directors. The fair value of the Company’s cash equivalents, when applicable, is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. At March 31, 2011, the Company estimates that the carrying values of all of its financial instruments approximate their fair values due to the nature or duration of these instruments.

As of March 31, 2011, there were no assets or liabilities measured at fair value on a recurring basis presented on the Company’s balance sheet.

Liabilities measured at fair value on a recurring basis were presented on the Company’s balance sheet as of December 31, 2010 as follows:

Summary of Significant Accounting Policies (continued)

Stock-based compensation

In accordance with ASC 718, Compensation – Stock Based Compensation and ASC 505-50, Equity Based Payments to Non-Employees, the Company accounts for share-based payments using the fair value method. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

Comprehensive loss

ASC 220, Comprehensive Income establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As at March 31, 2011, the Company has no items that represent other comprehensive loss and, therefore, has not included a schedule of other comprehensive loss in the financial statements.

New accounting policies adopted

In January 2010, the FASB issued Accounting Standards Update (ASU) No. 2010-06, Improving Disclosures about Fair Value Measurements, which amends the ASC Topic 820, Fair Value Measurements and Disclosures. ASU No. 2010-06 amends the ASC to require disclosure of transfers into and out of Level 1 and Level 2 fair value measurements, and also requires more detailed disclosure about the activity within Level 3 fair value measurements. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures concerning purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The adoption of this amendment did not have a material effect of the Company’s financial statements.

Recent accounting pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or result of operations.

Related Party Transactions and Balances

At March 31, 2011, a total of $29,472 (2010 - $2,233) was due to a director of the Company. The amount is unsecured, non-interest bearing and due on demand.

At March 31, 2011, a total of $23,000 (2010 - $Nil) was due to a director of the Company. The amount is unsecured, non-interest bearing and due on demand.

During the three months ended March 31, 2011, the Company recognized $1,333 (2010 - $Nil) for donated rent at $444 per month provided by the President of the Company.

During the three months ended March 31, 2011, the Company recognized $30,000 (2010 - $Nil) for management services at $10,000 per month provided by the President of the Company.

During the three months ended March 31, 2010, the Company shared office space with and incurred travel costs to Space Globe a company controlled by a former director (resigned on December 7, 2010) (“Space Globe”). During the three months ended March 31, 2010, the Company incurred an aggregate of approximately $3,000 of allocated office, rent and travel expenses to this company.

Common Stock

On January 24, 2011, the Company, pursuant to an agreement dated November 15, 2010, issued 1,500,000 shares of its common stock to a third party to settle accounts payable related to services provided. The shares were recorded in common shares to be issued as at December 31, 2010.

Commitments and Contingencies

Stock Purchase Agreement

On December 30, 2010, the Company entered into a Stock Purchase Agreement between the president and a director of the Company and Sunlogics Power Fund Management Inc. (“Sunlogics Power Fund”), whereby the Company agreed to acquire all of the issued and outstanding shares of capital stock of Sunlogics Power Fund from the Company’s president and director in exchange for 40,000,000 shares of the Company’s common stock. All conditions in the SPA have been satisfied and the Closing of the transaction will complete with the filing of an 8K with the SEC.

Indemnities

During the normal course of business, the Company has made certain indemnities and guarantees under which it may be required to make payments in relation to certain transactions. The Company indemnifies its directors, officers, employees and agents to the maximum extent permitted under the laws of the State of Nevada. These indemnities include certain agreements with the Company's officers under which the Company may be required to indemnify such person for liabilities arising out of their employment relationship. The duration of these indemnities and guarantees varies and, in certain cases, is indefinite. The majority of these indemnities and guarantees do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. Historically, the Company has not been obligated to make significant payments for these obligations and no liabilities have been recorded for these indemnities and guarantees in the accompanying balance sheets.

Incorporated by reference to the exhibits of the Registration Statement on Form 10-KSB filed with the Securities and Exchange Commission on August 6, 2004.

Filed herewith.