UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.  20549

FORM 20-F

[ ]

REGISTRATION STATEMENT PURSUANT TO SECTION 12 (b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934, OR

[ ]

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934, For the fiscal year ended , OR

[X]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT 1934, for the transition period from

August 31, 2003 to December 31, 2003



Commission File Number - 000-31070

RESIN SYSTEMS INC.(Exact name of Registrant as specified in its charter)

NOT APPLICABLE(Translation of Registrant's Name into English)

ALBERTA, CANADA(Jurisdiction of incorporation or organization)

14604 - 115A AVENUE, EDMONTON, ALBERTA, CANADA, T5M 3C5(Address of Principal Executive Offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

|(Title of Each Class) | (Name of Each Exchange on Which Registered)
|--------------------- | -------------------------------------------
|                      |                                            

Securities registered or to be registered pursuant to Section 12 (g) of the Act:

COMMON SHARES, WITHOUT PAR VALUE

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

NONE

Indicate the number of outstanding shares of each of the Company's classes of capital or common stock as of the close of the period covered by the Annual Report. 51,830,409

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 which financial statement item the registrant has elected to follow.

Item 17 X  Item 18 ___



Glossary

iv

Special Note Regarding Forward Looking Statements

vi

Part I

Item 1.

Identity of Directors, Senior Management and

Advisors

1

Item 2.

Offer Statistics and Expected Timetable

1

Item 3.

Key Information

1

Item 4.

Information on the Corporation

17

Item 5.

Operating and Financial Review and Prospects

46

Item 6.

Directors, Senior Management and Employees

61

Item 7.

Major Shareholders and Related Party Transactions

69

Item 8.

Financial Information

72

Item 9.

The Offering and the Listing

72

Item 10.

Additional Information

74

Item 11.

Quantitative and Qualitative Disclosures About

Market Risk

85

Item 12.

Description of Securities Other Than Equity

Securities

86

Part II

Item 13.

Defaults, Dividend Arrearages and Delinquencies

87

Item 14.

Material Modifications to the Rights of Security

Holders and Use of Proceeds

87

Item 15.

Disclosure Controls and Procedures

87

Item 16.

(Reserved)

87

Item 16A.

Audit Committee Financial Expert

87

Item 16B.

Code of Ethics

88

Item 16C.

Principal Accountant Fees and Services

88

Item 16D.

Exemptions From the Listing Standards for Audit

Committee

89

Item 16E.

Purchases of Equity Securities by the Issuer and

Affiliated Purchasers

89

Part III

Item 17.

Financial Statements

90

Item 18.

Financial Statements

90

Item 19.

Exhibits

90





GLOSSARY

The following are certain definitions of terms used herein:

|"Composites"        | Means a manufacturing or building material comprised of reinforced fibre, usually fibreglass, in a polymer matrix.  The polymer matrix is typically a thermoset resin such as polyester, vinyl ester or epoxy or a thermoplastic.  Fillers and additives are often added to the matrix for specific applications.                                                                                                                                                                                                                                                                            
|------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|"Fiberglass"        | Means various forms (rovings, mats, veils) of chemically treated glass reinforcements used in composites.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|"Filament winding"  | Means a composite manufacturing process in which glass roving reinforcements are wound in precise and repeated patterns.  It is the prevalent method for making "hollow" parts, such as chemical resistant piping, scuba tanks, and light standards.                                                                                                                                                                                                                                                                                                                                         
|"HAP" or "HAPs"     | Means Hazardous Air Pollutants as defined by EPA regulation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|"Major Transaction" | Means a transaction whereby a junior capital pool company, listed on the Alberta Stock Exchange (now the TSX Venture Exchange):                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                    | (i)
issues securities representing more than 25 percent of its securities issued and outstanding immediately prior to the issuance, in consideration for the acquisition of significant assets,                                                                                                                                                                                                                                                                                                                                                                                              
|                    | (ii)
enters into an arrangement, amalgamation, merger or reorganization with another issuer with significant assets, whereby the ratio of securities which are distributed to the two sets of security holders results in the security holders of the other issuer acquiring control of the resulting entity, or                                                                                                                                                                                                                                                                             
|                    | (iii)
otherwise acquires significant assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|"Polyester"         | Means a class of thermoset resins which combines alkyd resins with a monomer, such as styrene.  Polyester resins are widely used by the composite industry due to their low cost, but do not deliver high end properties or performance.                                                                                                                                                                                                                                                                                                                                                     
|"Polyurethane"      | Means a class of thermosetting resins created by reacting disocyanurates with polyols, polyamides, alkyd polymers or polyether polymers.  Polyurethanes are best known in the form of sound and heat insulating foams, but can also produce solid matrices, as in composite resins.                                                                                                                                                                                                                                                                                                          
|"Pultrusion"        | Means a continuous filament-reinforced plastic (FRP) manufacturing process used to produce highly reinforced plastic structural shapes.  The reinforced material (glass fiber) is pulled through a guide plate that positions the material correctly in the final product.  Once aligned, the materials are passed through a resin impregnation chamber, which contains the resin solution.  The curing of the product (changing from a wet saturated reinforcement to a solid part) is accomplished in the heated die.  The die is the configuration and profile of the good being produced.
|"Resin"             | Means a reactive blend of chemicals (epoxy, polyester, urethane, acrylic) that binds to the reinforcing glass "fiberglass" and gives the finished composite product its dimensional shape and mechanical properties.                                                                                                                                                                                                                                                                                                                                                                         
|"Thermo-plastics"   | Means general "household" plastics such as polyethylene and acrylic that may be heated and formed into an object and, unlike thermoset resins, can be reheated and returned to a liquid state.  As a result thermoplastics do not share the high performance characteristics of thermoset resins.                                                                                                                                                                                                                                                                                            
|"Uni-Seal USA"      | Means Uni-Seal USA, Ltd., a corporation incorporated under the laws of the State of Wisconsin, U.S., 100% of whose voting securities are owned by the Corporation.                                                                                                                                                                                                                                                                                                                                                                                                                           
|"Urethane"          | Means any one of a myriad of components known for their abrasion and impact resistance (see "polyurethane" above).                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|"Version®"          | Means the registered trademark of the resin systems RSI has developed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|"VOC"               | Means Volatile Organic Compounds, being chemical substances thought to be carcinogenic.  And includes styrene.  Traditional polyester resins contain 25% to 50% styrene which is an HAP.                                                                                                                                                                                                                                                                                                                                                                                                     

SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

Except for statements of historical fact, certain information contained herein constitutes "forward-looking statements", including, but not limited to, references to:

·

ability to continue as a going concern for the next twelve months

·

sources of revenue, and uses of financing and capital

·

sufficiency of our resources to fund our operations

·

production rates

·

the Canadian dollar exchange rate with United States dollars and other foreign currencies

·

business performance

·

future operating costs, development, marketing and discretionary expenditures

·

approval and completion of our listing on the American Stock Exchange

·

completion of private placements of our common shares

·

retail marketplace for our products

·

future technical expertise and creativity of personnel

·

applications of and markets for our products

·

seasonality of business

·

prices of chemical components of our products

·

increased productivity

·

safety of our product

·

effect of interest rates and exchange rates on our business

·

product pricing, margins and productivity

·

royalty payments

·

ability to find an audit committee financial expert.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other suggestions of future performance herein.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results or achievements to be materially different from any future results or achievements expressed or implied by such forward looking statements.  Such factors include, but are not limited to the following: our lack of revenues and unpredictability of future revenues; our future capital requirements; competition from established competitors with greater resources; the uncertainty of developing a market; our reliance on third parties to supply raw materials; the risks associated with rapidly changing technology; intellectual property risks; and the other risks and uncertainties as are more fully described in "Item 3 - Key Information - D. Risk Factors".  Any forward-looking statement speaks only as of the date of this Annual Report on Form 20-F, and, except as provided by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of an unanticipated event.



PART I

ITEM 1.

IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

Not applicable.

ITEM 2.

OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3.

KEY INFORMATION

A.

Selected Financial Information

The following selected consolidated financial data prepared in accordance with Canadian generally accepted accounting principles ("Cdn. GAAP"), for the four months ended December 31, 2003 and the years ended August 31, 2003, 2002, 2001, 2000 and 1999 are derived from the Audited Consolidated Financial Statements for those periods indicated and should be read in conjunction with those financial statements.



|                                                                                | 4 Months    | Fiscal Years Ended August 31 (audited)
|------------------------------------------------------------------------------- | ----------- | --------------------------------------
|                                                                                | (audited)   |                                       
|                                                                                | Dec. 31     | 2003                                  
|                                                                                | 2003        |                                       
|According to Cdn. GAAP                                                          |             |                                       
|                                                                                |             |                                       
|Revenue                                                                         | $   461,420 | $   311,811                           
|                                                                                |             |                                       
|Cost of sales                                                                   | 333,899     | 118,333                               
|                                                                                |             |                                       
|Net Revenue                                                                     | 127,521     | 193,478                               
|                                                                                |             |                                       
|Income (loss) from
continuing operations
before extraordinary
and unusual items | (2,891,553) | (4,586,359)                           
|                                                                                |             |                                       
|Income (loss) from
continuing operations
per share before
extraordinary item    | (0.06)      | (0.11)                                
|                                                                                |             |                                       
|Net income (loss)                                                               | (2,891,553) | (4,586,359)                           
|                                                                                |             |                                       
|Net income (loss)
per share(1)                                                  | (0.06)      | (0.11)                                



|                                                                           | 4 Months    | Fiscal Years Ended August 31 (audited)
|-------------------------------------------------------------------------- | ----------- | --------------------------------------
|                                                                           | (audited)   |                                       
|                                                                           | Dec. 31     | 2003                                  
|                                                                           | 2003        |                                       
|According to Cdn. GAAP                                                     |             |                                       
|                                                                           |             |                                       
|Total Assets                                                               | $ 6,913,491 | $ 5,770,897                           
|                                                                           |             |                                       
|Net assets                                                                 | 5,233,187   | 4,791,474                             
|                                                                           |             |                                       
|Capital stock                                                              | 22,103,610  | 18,818,497                            
|                                                                           |             |                                       
|Weighted average
number of shares (adjusted to reflect
changes in capital) | 47,622,018  | 41,366,763                            
|                                                                           |             |                                       
|Dividends                                                                  | --          | --                                    

Notes:

1.

Loss per common share has been calculated based on the weighted average number of shares outstanding during the period.  Fully diluted loss per common share has not been presented since the exercise of stock options and warrants would be anti-dilutive for all periods.

The application of United States generally accepted accounting principals ("U.S. GAAP") would have the following effect on our net loss reported under Cdn. GAAP.

|                            | 4 Months    | Fiscal Years Ended August 31 (audited)
|--------------------------- | ----------- | --------------------------------------
|                            | (audited)   |                                       
|                            | Dec 31      | 2003                                  
|                            | 2003        |                                       
|According to U.S. GAAP      |             |                                       
|                            |             |                                       
|Revenue                     | $  453,156  | $   275,074                           
|                            |             |                                       
|Cost of sales               | 333,899     | 118,333                               
|                            |             |                                       
|Net Revenue                 | 119,257     | 156,741                               
|                            |             |                                       
|Net income (loss)           | (2,912,812) | (8,021,851)                           
|                            |             |                                       
|Net income (loss)
per share | (0.06)      | (0.19)                                



|                                                                           |             | 4 Months    | Fiscal Years Ended August 31 (audited)
|-------------------------------------------------------------------------- | ----------- | ----------- | --------------------------------------
|                                                                           | (audited)   |             |                                       
|                                                                           | Dec 31      | 2003        | 2002                                  
|                                                                           | 2003        |             |                                       
|According to U.S. GAAP                                                     |             |             |                                       
|                                                                           |             |             |                                       
|Total Assets                                                               | $ 7,209,289 | $ 5,930,031 | $ 1,449,627                           
|                                                                           |             |             |                                       
|Net assets                                                                 | 5,297,796   | 4,822,436   | 1,043,479                             
|                                                                           |             |             |                                       
|Capital stock                                                              | 31,482,460  | 28,142,441  | 17,177,463                            
|                                                                           |             |             |                                       
|Weighted average
number of shares (adjusted to reflect
changes in capital) | 47,622,018  | 41,366,763  | 19,369,745                            
|                                                                           |             |             |                                       
|Dividends                                                                  | --          | --          | --                                    

Notes:

2.

The application of U.S. GAAP reported above is the combination of the following items for the following years:

| |                                                         | 4 Months     | Fiscal Years Ended August 31 (audited)
| | ------------------------------------------------------- | ------------ | --------------------------------------
| | (audited)                                               |              |                                       
| |                                                         | Dec. 31 2003 | 2003                                  
| | Net loss per Cdn. GAAP                                  | $(2,891,553) | $(4,586,359)                          
| |                                                         |              |                                       
| | Intangible assets, net of related amortization          | --           | --                                    
| |                                                         |              |                                       
| | Stock granted to employees                              | (1,944)      | (5,833)                               
| |                                                         |              |                                       
| | Stock options granted to employees and directors        | --           | --                                    
| |                                                         |              |                                       
| | Fair value of escrow shares issuable under time release | --           | (3,371,714)                           
| |                                                         |              |                                       
| | Stock options granted to consultants                    | (19,315)     | (57,945)                              
| |                                                         |              |                                       
| | Net loss per U.S. GAAP                                  | (2,912,812)  | (8,021,851)                           
| |                                                         | 4 Months     | Fiscal Years Ended August 31 (audited)
| | (audited)                                               |              |                                       
| |                                                         | Dec. 31 2003 | 2003                                  
| |                                                         |              |                                       
| | Total assets Cdn. GAAP                                  | $6,913,491   | $5,770,897                            
| |                                                         |              |                                       
| | Less intangible assets                                  | --           | --                                    
| |                                                         |              |                                       
| | Deferred compensation                                   | 295,798      | 159,134                               
| |                                                         |              |                                       
| | Total assets U.S. GAAP                                  | 7,209,289    | 5,930,031                             
| |                                                         |              |                                       
| |                                                         |              |                                       
| | Net assets Cdn. GAAP                                    | $5,233,187   | $4,791,474                            
| |                                                         |              |                                       
| | Less Intangible assets                                  | --           | --                                    
| |                                                         |              |                                       
| | Current liabilities                                     | (231,189)    | (128,172)                             
| |                                                         |              |                                       
| | Add Deferred compensation                               | 295,798      | 159,134                               
| |                                                         |              |                                       
| | Net assets U.S. GAAP                                    | $5,297,796   | $4,822,436                            

Currency and Exchange Rates

Financial information in this report is expressed in Canadian dollars, unless otherwise noted.  References to "Cdn. dollar", "Cdn. $" or "$" are to Canadian dollars.  References to "U.S. dollar" or "U.S. $" are to United States dollars.  Since June 1, 1970, the Canadian government has permitted a floating exchange rate to determine the value of the Cdn. dollar as compared to the U.S. dollar.

The following tables set forth high and low exchange rates for each month during the previous six months, and the average rates for each of our last five fiscal years and for the four months ended December 31, 2003, calculated by using the average of the exchange rates on the last day of each month during the period.  These rates are based upon the inverse of the noon buying rates reported by the Federal Reserve Bank of New York for cable transfers payable in the Cdn. dollars as certified for custom purposes.



As of May 31, 2004, the noon buying rate was Cdn.$1.00 = U.S.$ 0.7317.



|Month Ended        | High   | Low   
|------------------ | ------ | ------
|July 31, 2003      | 0.7085 | 0.7481
|August 31, 2003    | 0.7092 | 0.7228
|September 30, 2003 | 0.7207 | 0.7424
|October 31, 2003   | 0.7418 | 0.7667
|November 30, 2003  | 0.7484 | 0.7708
|December 31, 2003  | 0.7460 | 0.7738
|January 31, 2004   | 0.7496 | 0.7880
|February 29, 2004  | 0.7439 | 0.7629
|March 31, 2004     | 0.7418 | 0.7645
|April 30, 2004     | 0.7293 | 0.7637
|May 31, 2004       | 0.7158 | 0.7364



|Year/Period Ended | Average Rate
|----------------- | ------------
|                  |             
|August 31, 1999   | 0.6643      
|August 31, 2000   | 0.6804      
|August 31, 2001   | 0.6502      
|August 31, 2002   | 0.6361      
|August 31, 2003   | 0.6767      
|December 31, 2003 | 0.7618      

B.

CAPITALIZATION AND INDEBTEDNESS

Not Applicable.

C.

REASONS FOR THE OFFER AND USE OF PROCEEDS

Not Applicable.

D.

RISK FACTORS

You should consider carefully the risk factors set forth below as well as the other information contained in this annual report.  If any event arising from these risks occurs, our business, prospects, financial condition, results of operations and cash flows could be materially adversely affected.

Our independent auditors have raised doubts about our ability to continue as a going concern.

The financial statements comprising part of this Annual Report have been prepared on a "Going Concern Basis", which is described more fully in note 1 of the financial statements.  In accordance with Cdn. GAAP, and based upon key factors listed herein, management believes such a note in the financial statements is appropriate, and our independent auditors concur.  Our audit report includes an explanatory paragraph that expresses doubt about our ability to continue as a going concern.

The application of "going concern" is dependent on our ability to realize our assets and discharge our liabilities in the normal course of business for the foreseeable future.  To date we have not recorded a profit from operations, and have derived virtually all of our working capital through the sale of our securities.  We have experienced erratic revenue trends over the course of our history and, at times, deficiencies in working capital.

Various other factors described in this document also make it prudent that this disclosure be included.



It may be difficult to enforce a U.S. judgment against us and any of our officers and directors or to assert U.S. securities laws claims in Canada or serve process on our officers and directors.

Resin, our officers, directors and auditors are all residents of Canada, and substantially all of our assets are or may be located outside of the United States.  As a result, it may be difficult for investors to affect service of process within the United States upon our officers and directors, or to enforce against them judgments obtained in the United States courts predicated upon the civil liability provisions of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, or state securities laws.  We believe that a judgment of a United States court predicated solely upon civil liability under the Securities Act and/or Exchange Act would probably be enforceable in Canada if the United States court in which the judgment was obtained had a basis for jurisdiction in the matter that was recognized by a Canadian court for such purposes.  However, we cannot assure any investor that this will be the case.  There is substantial doubt, moreover, whether an action could be brought in Canada in the first instance on the basis of liability predicated solely upon such laws.

We have a history of losses, and we cannot assure investors that we will operate profitably in the future.

We have a limited operating history.  We are in the commercialization stage of our resin and end-product business and therefore are subject to the risks associated with early stage companies, including uncertainty of revenues, markets and profitability and the need to raise additional funding.  We are committing, and for the foreseeable future will continue to commit, significant financial resources to marketing, product development and research.  Our business and prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in the early stage of development, particularly companies in relatively new and evolving markets such as composites.  We have not earned profits to date and cannot assure our investors that we will achieve, or be able to sustain, profitability in the future.  A significant portion of our financial resources will continue to be directed to the development of our products and to marketing activities.  Our success will ultimately depend on our ability to generate revenues from our product sales, such that our business development and marketing activities may be financed by revenues from operations instead of outside financing.   Future revenues may be insufficient to generate the required funds to continue such business development and marketing activities.

We are dependent on our senior management.  Any loss of the services of our senior management could negatively affect our business.

Our success will depend, to a significant extent, on the performance of a number of our senior management personnel and other key employees.  In particular, we will be dependent upon the services of Greg Pendura and Paul Giannelia.  We do not anticipate having key person insurance in place in respect of any of our senior officers or other personnel.  To the extent that the services of any of our key personnel become unavailable, we will be required to retain other qualified persons.  We may not be able to find a suitable replacement for any such person.  The loss of the services of key persons could have a material adverse effect on our business, financial condition and results of operations.

Our failure to retain and attract personnel could harm our business, operations and product development efforts.

Our products require sophisticated research and development, marketing and sales, and technical customer support.  Our success depends on our ability to attract, train and retain qualified research and development, marketing and sales and technical customer support personnel.  Competition for personnel in all these areas is intense and we may not be able to hire sufficient personnel to achieve our goals or support the continued growth in our business.  If we fail to attract and retain qualified personnel, our business, operations and product development efforts would suffer.

We may need additional financing.

During the past five months we completed two private placements and warrant exercises of our securities for aggregate gross proceeds of approximately $12,500,000 which we expect will be sufficient to finance our budgeted operating costs, development, marketing and anticipated discretionary expenditures for the next year.  However, in order to accelerate our growth objectives, we may need to raise additional funds from lenders and equity markets in the future.  We may be unable to raise additional capital on commercially reasonable terms to finance our growth.  Our ability to arrange such financing in the future will depend on our business performance as well as the prevailing capital market conditions.  If we issue common shares in order to obtain such additional financing, control of our company could change and shareholders will suffer additional dilution.

We depend on third party supply and transportation systems, and any disruptions could impair our ability to compete in the marketplace.

The chemical industry is sensitive to raw material, manufacturing and shipping costs.  Many input chemicals used to manufacture thermosetting resins are commodities with pricing directly dependent on supply, demand and the cost of underlying raw materials, in particular oil and gas, as well as agricultural by-products.

Although we could obtain raw materials from many other suppliers in the marketplace, such suppliers may be unwilling to sell us raw materials upon acceptable terms and conditions.  Our inability to obtain supplies from other suppliers in a sufficient amount when needed, and upon acceptable terms and conditions, would likely cause delays in, or disruption to, our business, and could also impair our ability to compete in the marketplace.

Third parties may infringe upon or misappropriate our intellectual property, which could impair our ability to compete effectively and negatively affect our profitability.

Our success depends upon the protection of our technology, trade secrets and trademarks.  Our profitability could suffer if third parties infringe upon our intellectual property rights or misappropriate our technology and other assets.  To protect our rights to our intellectual property, we rely on a combination of trade secret protection, trademark law, confidentiality agreements and other contractual arrangements.  The protective steps we have taken may be inadequate to deter infringement or misappropriation.

We cannot determine whether future patent or trademark applications, if any, will be granted.  Our current intellectual property or any future intellectual property that we may develop could be challenged, invalidated or circumvented and may not necessarily provide us with any competitive advantage.

Litigation may be necessary to enforce our intellectual property rights, protect trade secrets, determine the validity and scope of the proprietary rights of others, or defend against claims of infringement or invalidity.  Intellectual property laws provide limited protection.  Moreover, the laws of some foreign countries do not offer the same level of protection for intellectual property as the laws of the United States and Canada.  We may be unable to detect the unauthorized use of our intellectual property.  Litigation may result in substantial costs and diversion of resources, which may limit the development of our business.

Our products may infringe on the intellectual property rights of others, which could increase our costs and negatively affect our profitability.

Our commercial success may depend, in part, on our ability to avoid infringing on patents issued to others.  Although we are not aware of any action or threatened action alleging patent infringement or improper use of proprietary information by us, if we have to defend any such claims, we could incur substantial costs, and our management resources could be diverted.

If we were found to be infringing any third party patents, we could be required to pay damages, alter our products or processes, obtain licenses or cease certain activities.  We cannot be certain that if we required licenses for patents held by third parties that they would be made available on terms acceptable to us, if at all.  The inability to obtain licenses may prevent us or our customers from offering products and services to our customers, which may limit our revenue.

Competition in the markets for our products and technology is intense.  We may not be able to compete effectively in these markets, and we may lose current customers and fail to attract new customers.

We may not be able to compete successfully against current and future competitors, and the competitive pressures we face could harm our business and prospects.  Broadly speaking, our products will be alternatives to traditional thermoset resins, such as polyester and epoxy, and traditional building products, such as wood, steel, concrete and aluminum.  As such, we will compete with these options.  Our direct competition comes substantially from larger companies.  Some of these companies have products that are intended to compete directly with our products.  In addition, companies against whom we do not presently directly compete are planning to become competitors in the future.  This could occur either through the expansion of our products or through product development undertaken by other companies in the area of composites.

The market for composites is relatively new and is highly competitive.  The level of competition is likely to increase as current competitors improve their offerings and as new participants enter the market.  Many of our current and potential competitors have longer operating histories, larger customer bases, greater brand recognition and significantly greater financial, sales, marketing, technical and other resources than we do.  Moreover, these competitors may enter into strategic or commercial relationships with larger more established and better financed companies.  Some of our competitors may be able to enter into these strategic or commercial relationships on more favorable terms. Additionally, these competitors have research and development capabilities that may allow them to develop new or improved products that may compete with product lines which we market and distribute.  New technologies and the expansion of existing technologies may also increase competitive pressures on us.  Increased competition may result in reduced operating margins as well as loss of market share.  This could result in decreased usage of our products and limit our ability to compete effectively and restrict us from generating additional revenues.

Our lengthy sales and integration cycle could cause delays in revenue growth.

The inability to sell our products to new customers on a timely basis, or delays by our existing and proposed customers in the testing and adoption of our products, could limit revenue and harm our business and prospects.  Our customers will need to evaluate our products.  In addition, our customers may need to adopt a comprehensive sales, marketing and training program in order to effectively integrate our products.  For these and other reasons, the cycle associated with establishing sales for our products, and integrating our products, can be lengthy.  This cycle is also subject to a number of significant delays over which we will have little or no control, and which have a negative impact on the timing of our revenue.

Implementation delays could cause delays in revenue growth.

Most of our customers will be in a testing or preliminary stage of utilizing our products and may encounter delays or other problems in the introduction of our products.  A decision not to do so, or a delay in implementation, could result in a delay or loss of related revenue or could otherwise harm our business and prospects.  We will not be able to predict when a customer that is in a testing or a preliminary use phase will adopt a broader use of our products.

We may not be successful in developing markets.

The market for our products is relatively new and continues to evolve.  If the market for our products fails to develop and grow, or if our products do not gain broad market acceptance both by processors, such as pultrusion and filament winding, and end users, our business and prospects will be harmed.  The adoption and use of our products will involve changes in the manner in which businesses have traditionally used such products within their processing systems. In some cases, our customers will have little experience with products like those offered by us.  Our ability to influence usage of our products by customers will be limited or non-existent.  We will spend considerable resources educating potential customers about the value of our products.  It is difficult to assess, or predict with any assurance, the present and future size of the potential market for our products, or our growth rate, if any.  Moreover, we cannot predict whether our products will achieve market acceptance.  Our ability to achieve our goals also depends upon rapid market acceptance of future enhancements to our products.  Any enhancement that is not favourably received by our customers may not be profitable and, furthermore, could damage our reputation or brand name.

We must develop new products and technology and enhancements to our existing products and technology to remain competitive.  If we fail to do so, we may lose market share to competitors.

The composite industry is susceptible to technological advances and the introduction of new products utilizing new resin formulas and processing technologies.  Further, the composite industry is also subject to changing industry standards, market trends and customer preferences, and to competitive pressures which can, among other things, necessitate revisions in pricing strategies, price reductions and reduced profit margins.  Our success will depend on our ability to secure technological superiority in our products and maintain such superiority in the face of new resin formulations, the advance of thermoplastics and new processing technologies and products.  While we believe that our products will be competitive, no assurances can be given that our products will be commercially viable or that further modification or additional products will not be required in order to meet demands or to make changes necessitated by developments made by competitors which might render our products less competitive, less marketable, or even obsolete over time.

Our future success will be influenced by our ability to continue to develop new competitive products.  Although we are committed to the development of new products and the improvement of our existing products, there can be no assurance that these research and development activities will prove profitable, or that products or improvements resulting therefrom, if any, will be successfully produced and marketed.  The composite industry is characterized by technological change, changes in user and customer requirements, new product introductions embodying new resin formulations and new processing technologies and the emergence of new industry standards and practices that could render our technology obsolete or have a negative impact on our sales margins.  Our performance will depend, in part, on our ability to enhance our existing products, develop new proprietary technology that addresses the sophisticated and varied needs of our prospective customers and respond to technological advances and emerging industry standards and practices on a timely and cost-effective basis.  The development of technology entails significant technical and business risks.  If we are unsuccessful in using new technologies effectively or adapting our products to customer requirements or emerging industry standards, we may lose market share, and our revenues may decline.

The loss of strategic alliances could make our products less appealing and useful to customers.

Our growth and marketing strategies are based, in part, on seeking out and forming strategic alliances and working relationships.  To the extent that the strategic alliances negotiated by us are exclusive or restricted as to location or technological environment they will limit our flexibility to broaden our distribution by increasing the number of strategic alliances and working relationships.  There can be no assurance that existing strategic alliances and working relationships will not be terminated or modified in the future, nor can there be any assurance that new relationships, if any, will afford us the flexibility to broaden its distribution.

We may encounter product deficiencies which could be detrimental to our reputation.

Difficulties in product design, performance and reliability could result in lost revenue, delays in customer acceptance of our products, and/or lawsuits, and would be detrimental, perhaps materially, to our market reputation.  Serious defects are frequently found during the period immediately following the introduction of new products or enhancements to existing products.  Our products and the products incorporated from third parties are not error free.  Undetected errors or performance problems may be discovered in the future.  Moreover, known errors which we might consider minor may be considered serious by its customers.  If our internal quality assurance testing or customer testing reveals performance issues and/or desirable feature enhancements, we could postpone the development and release of updates or enhancements to our current products, future products or improvements in its products.  We may not be able to successfully complete the development of planned or future products in a timely manner, or to adequately address product defects, which could harm our business and prospects.  In addition, product defects may expose us to liability claims, for which we may not have sufficient liability insurance.  A successful suit against us could harm our business and financial condition.

Government regulation and environmental considerations could delay or prevent product offerings, resulting in decreased revenues.

We are and will continue to be subject to certain legislation and regulations dealing with the environment and the composite industry.  There is no certainty about the extent or direction of future regulation in this area and adverse legislation dealing with the impact of composites on the environment or the transportation of goods could adversely affect the sale of current and future products.

The composite industry is presently under intense scrutiny due to its production of harmful "greenhouse" gasses or HAPs.  The EPA in the United States has established a regulatory regime that has targeted airborne emissions of styrene, toluene, xylene, methyl, methacrylate and methylene chloride in the reinforced plastics industry.  The EPA regulates manufacturers' outputs of HAPs, including VOC's, by way of a complicated algorithm.  Existing companies in the composite industry must achieve a level of emissions control that is equivalent or superior to the average emission levels of the companies making up the 12% of the composite industry with the lowest emission levels.  Furthermore, new companies entering the composite industry must achieve emission levels equivalent or superior to the company in the composite industry with the lowest emission levels.  The EPA monitors both the size level of hazardous air pollutants and companies' abilities to enact the expensive environmental controls that may be mandated by the EPA.  As a consequence of this regulation, the production capabilities of companies in the composite industry are presently curtailed due to the restrictive quotas placed on the amount of toxic resins that may be purchased for the production of reinforced plastics.

Typical polyester and vinyl ester resin systems contain up to 50% styrene and smaller percentages of other restricted chemicals.  Recently, the majority of the major producers of composites have reformulated their existing products such that they contain approximately 35% styrene.  Notwithstanding this improvement, the styrene reduction does not eliminate the VOC emission problem inherent in composite products.  Moreover, many users of reformulated composite products have reported difficulties with these new product formulations.  We believe our resins to be free of VOC's, and further believe that we are in full compliance with all applicable environmental legislation and regulations.  However, there can be no assurance that our products are free of all VOC's or other harmful products, that our products comply with all existing environmental legislation and regulations, or that our products will be in compliance with all environmental legislation and regulations enacted in the future.

We are not currently subject to other direct regulation by any government agency, other than applicable securities laws, regulations applicable to businesses generally and laws or regulations directly applicable to the composite industry.  However, due to the increasing concern for the integrity of the environment, it is possible that a number of laws and regulations may be adopted with respect to the environment or the transportation of goods which may impose additional burdens on companies conducting business related to the composite industry, and thus increase our cost of doing business.  There can be no assurance that any such new legislation or regulation will not be enacted, nor that the application of laws or regulations from jurisdictions whose laws do not currently apply to our business will subsequently become applicable.  If we do not obtain the necessary approvals to sell our products, our revenues could seriously decrease.

If we are unable to manage our growth effectively, our revenues may not increase, our cost of operations may rise and we may remain unprofitable.

We may be subject to growth-related risks including capacity constraints and pressure on our internal systems and controls.  Our ability to manage our growth effectively will require us to continue to implement and improve our operational and financial systems and to expand, train and manage our employee base.  The inability of us to deal with this growth could have a material adverse impact on our business, operations and prospects.  While management believes that it will have made the necessary investments in infrastructure to process anticipated volume increases in the short term, we may experience growth in the number of our employees and the scope of our operating and financial systems, resulting in increased responsibilities for our existing personnel, the hiring of additional personnel and, in general, higher levels of operating expenses.  In order to manage our current operations and any future growth effectively, we will also need to continue to implement and improve our operational, financial and management information systems and to hire, train, motivate, manage and retain our employees.  We may be unable to manage such growth effectively.  Our management, personnel or systems may be inadequate to support our operations, and we may be unable to achieve the increased levels of revenue commensurate with the increased levels of operating expenses associated with this growth.

Exchange rate fluctuations may harm our results of operations.

We do not engage in any hedging or currency trading activities.  Our business activities are conducted in Cdn. and U.S. dollars and our assets and liabilities are recorded in Cdn. dollars.  Approximately 50% of our sales revenue are in U.S. dollars and the majority of our costs of sales and administrative costs are in Cdn. dollars.  We have no U.S. dollar denominated assets.  U.S. dollar revenues have been less than $250,000 annually for each of the last two fiscal years.  As our accounts payable are principally in Cdn. dollars and some of our accounts receivable are in U.S. dollars, any appreciation in the value of the Cdn. dollar against the U.S. dollar would result in an exchange loss.

Expansion into the United States and other markets outside of Canada could strain our financial position.

We will invest significant financial and managerial resources to expand our sales and marketing operations into the United States and, possibly, other foreign countries.  Should we find it necessary to do so, the cost of opening new offices in the United States and abroad and hiring new personnel for such offices could significantly decrease our profitability, if such new offices do not generate sufficient additional revenue.

We must devote substantial resources to our international operations in order to succeed in these markets.  In this regard, we may encounter difficulties such as: (i) unexpected changes in regulatory requirements and trade barriers applicable to our business; (ii) challenges in staffing and managing foreign operations, including employment laws and practices in jurisdictions with different legal systems; (iii) seasonal reductions in business activity and economic downturns; (iv) longer payment cycles and problems in collecting accounts receivable; (v) different technology standards.  In addition, our focus on international markets subjects us to fluctuations in currency exchange rates.  Any of the foregoing difficulties experienced in conducting business internationally could harm our international operations and, consequently, our business and prospects.

Some of our directors are engaged in other activities which may pose potential conflicts of interest.

Certain of our directors and officers are engaged in, and will continue to engage in, other business activities on their own behalf and on behalf of other companies and, as a result of these and other activities, such directors and officers may become subject to conflicts of interest.  Canadian law provides that in the event that a director has an interest in a contract or proposed contract or agreement, the director shall disclose his interest in such contract or agreement and shall refrain from voting on any matter in respect of such contract or agreement unless otherwise provided under the relevant Canadian statute.  To the extent that conflicts of interest arise, such conflicts will be resolved in accordance with Canadian law.  These conflicts of interest could result in some directors or officers competing against us.

The significant shareholdings of the principals of our company could delay or prevent a change of control.

Our directors and executive officers, and their respective associates and affiliates, hold or exercise control over, directly or indirectly, an aggregate of 7,795,181 common shares, representing approximately 12.2% of our issued and outstanding common shares as of May 31, 2004.  As a result thereof, these shareholders, acting together, will be able to continue to exercise significant influence over all matters requiring shareholder approval, including the election of directors and the approval of fundamental changes in the direction of our business.  Such concentration of ownership may have the effect of delaying or preventing a change in control of our company, our board of directors or our management.

There is no assurance that an active trading market in our shares in the U.S. will be established and/or, if established, sustained and there may be volatility in our share price.

We have applied to list our common shares for trading on the American Stock Exchange.  We expect such listing to be completed during the third quarter of calendar 2004.  However, there can be no assurance that our application will be approved or that an active trading market in our shares in the U.S. will be established and/or if established sustained.  The market price for our shares could be subject to wide fluctuations.  Factors such as announcements of quarterly variations in operating results, technological innovations or the introduction of new products by our competitors, as well as market conditions in the industry, may have a significant impact on the market price of our shares.  The stock market has from time to time experienced extreme price and volume fluctuations, which have often been unrelated to the operating performance of particular companies.

ITEM 4.

INFORMATION ON THE CORPORATION

A.

History And Development of Resin Systems Inc.

We were incorporated in 1995 as Recycled Solutions for Industry Inc. under the Business Corporations Act (Alberta) and, effective September 15, 1998, completed a reverse takeover of Summerwood Industries Inc. Summerwood was incorporated on June 11, 1996 under the Business Corporations Act (Alberta).  Summerwood completed its initial public offering of common shares, as a junior capital pool corporation, on February 24, 1997.  The common shares of Summerwood were listed and began trading on The Alberta Stock Exchange (now the TSX Venture Exchange) on March 18, 1997.

Effective September 15, 1998, Summerwood acquired all of the shares of Recycled Solutions on the basis of 0.684218655 of a common share for each class A share of Recycled Solutions outstanding.  Summerwood issued an aggregate of 17,977,553 common shares which it valued at $0.20 per share, aggregating a value of approximately $3.6 million.  This acquisition constituted Summerwood's Major Transaction as required by the Alberta Securities Commission and The Alberta Stock Exchange.

By articles of amalgamation dated September 17, 1998, Summerwood amalgamated with Recycled Solutions, to form Recycled Solutions for Industry Inc. By articles of amendment dated May 5, 2000, Recycled Solutions changed its name to Resin Systems Inc.

Our principal office is located at 14604 - 115A Avenue, Edmonton, Alberta, Canada, T5M 3C5, telephone number (780)482-1953.  Additionally, we have a second production plant in Edmonton and have established an office for our RS Technologies division in Calgary.

We have seven subsidiary companies of which six are wholly owned and one is 85% owned.  The wholly owned subsidiaries are Resin Systems Incorporated, Resin Systems International Ltd., Resin Systems Sales Limited, Uni-Seal USA Ltd., RS Technologies Inc. and New Version Sport Inc. The 85% owned subsidiary is Uni-Seal Moulding Technologies Inc. All of the subsidiaries are inactive at this time, with the exception of Resin Systems International Ltd. and New Version Sport Inc.

General Development of Our Business

From mid 1996 until the fall of 2000, our main business pursuit was the manufacture and sale of proprietary RSealTM (formerly Uni-SealTM)  polyurethane based industrial coatings.

In mid 1998, as a result of our coatings experience, we developed a hybrid polyurethane based resin product for moulding applications.  In a joint project with the University of Laval, a race car body was designed and built with the new, lightweight resin compound, the forerunner of our VersionTM resin.  The result was a stronger composite than many available at that time.  The prototype body was awarded first prize in a racing design competition and was subsequently put on display at the world famous Indy 500, where the Indianapolis Motor Speedway proclaimed Uni-Sealä the "Industrial Coating of Choice".

As an outgrowth of the industrial coatings, we developed a composite resin product, called VersionTM which does not contain any volatile organic compounds.  We began shifting our emphasis to the area of composites due to the significant global growth that this sector was enjoying.

During our 2000 fiscal year, we concentrated our efforts on further development and pre-commercialization of the VersionTM composite resin.

Our efforts to develop our VersionTM resin product line included running a beta test program  both on-site and off-site  together with running testing programs at independent labs.  Patent Applications were filed during this time period as well.

Based on the success of the first production trials in the latter half of 2000, we began taking delivery of new resin blending equipment at our Edmonton facility which became operational in late 2000.

In order to expedite production trials and product testing, we also acquired a full-scale pultrusion machine at that time.  Prospective customers are now able to ship their production dies directly to our Edmonton facility for component manufacturing and testing.  This eliminates the need for the customer to halt commercial production at their own facilities in order to carry out production trials.

In 2001 after little success in introducing our VersionTM resin to potential users, we implemented our revised corporate strategy, to move in-house, end product manufacturing, in an effort to try to accelerate the entry of our VersionTM resins in the composite marketplace.  We began directly developing, engineering, manufacturing and supplying composite material end products employing our VersionTM resin to both the industrial and consumer marketplace.  In order to implement the new strategy we acquired in-house expertise in the areas of engineering design and commercial pultrusion production capabilities so that we could manufacture products from our VersionTM resins, in addition to supplying our resins to end product manufacturers.

In early 2002, we entered into a collaborative research and development agreement with the Alberta Research Council Inc. (ARC) whereby the ARC's test center capabilities would be utilized to present evaluative and comparative product data for the VersionTM family of resins.  The ARC provided $500,000 of research and development services to us over the term of the agreement in exchange for common shares.  To the end of December 31, 2003, the ARC has provided $481,189 of research and development services to us in consideration for 724,674 common shares.  This agreement was amended in early 2004, to extend the development work being done by ARC.  Under this amendment, ARC will extend their work by another $100,000 which will bring total expenditures up to $600,000 and extending the time frame for the work from March 31, 2004 to June 30, 2004.

In early 2002, we also entered into an agreement with the National Research Council of Canada (NRC) to further develop our VersionTM family of resins.  The support from the N R C expedited the further development of our VersionTM resin system for the large pultrusion and filament winding composite markets.  The proceeds of a $400,000 repayable contribution from the NRC's Industrial Research Assistance Program focused on pre-commercialization and development funding to facilitate the evolution of further VersionTM formulations to address needs of the industry.  This Agreement was amended in early 2004 to facilitate further product development activities.  The funding increased by $98,263 to $498,263 and the repayment terms pursuant to the original agreement have been extended to commence March 1, 2006 through December 1, 2010 rather than June 1, 2005 through March 1, 2010.

We believe that the agreements with the ARC and NRC will provide us with product characterization data which will allow us to aggressively promote the superiority of our VersionTM resin system from an engineering/design prospective to the composite industry.

In April 2002, we received approval from the United States Patent Office for all 37 claims contained in our United States patent application filed in July 2000.

We also obtained trademark registration from the United States Patent and Trademark Office and the Canadian Intellectual Property Office in 2002 for the VersionTM name.

In mid 2002, we entered into a supply agreement with Dow Chemical Canada Inc., pursuant to which Dow agreed to supply us with some base chemicals we use to manufacture our VersionTM resins.  The agreement expired on December 31, 2003, but we have received verbal continuance of the supply agreement and Dow has made further deliveries at competitive rates and terms consistent since then.

In late 2002, we commenced the development of a working relationship with Canzeal Enterprises of Yellowknife, NWT, as they were developing composite based utility poles and were in need of better resins.  The superior characteristics of VersionTM resin, were and remains a good match with the proprietary pole winding technology as originally developed by Canzeal.

In January 2003 we completed the arm's length acquisition of the worldwide right, title and interest in and to all intellectual property assets of Canzeal Enterprises Ltd. related to the design, manufacture and distribution of composite poles.  We issued Canzeal shares in Resin Systems Inc., will pay a specified royalty on revenues received on the manufacture and sales of utility poles and granted Canzeal certain rights of first refusal to build line equipment.

In January 2003, we completed the private placement of 6,000,000 units at a price of $0.50 per unit, for total gross proceeds of $3,000,000.  Each unit consisted of one common share and one-half of one common share purchase warrent, each whole common share purchase warrant entitled the holder thereof to acquire one common share at an exercise price of $0.75 per share at any time on or before January 9, 2004.  We used the proceeds to establish a Canadian based manufacturing facility, infrastructure and a marketing/sales team to commercialize the manufacture and sale of composite poles and other resin based products.

On January 9, 2003, we entered into a distribution and option for manufacturing agreement with Harwell Hesco Electric Supply Co.  Limited, an Ontario corporation, appointing Harwell Hesco as the eastern Canadian distributor of our composite poles and granting Harwell Hesco an option to become our exclusive agent entitled to manufacture and supply our composite poles in eastern Canada.  The initial term of the agreement is for two years, which is extendible by mutual agreement between the parties.

In March 2003, we commenced the development of and marketing of composite hockey shafts through our subsidiary New Version Sports Inc. (NVS).  Initially we marketed to minor hockey teams with the goal of establishing a grass roots marketing program.  We have since moved the sale of hockey shafts into the retail marketplace.

In August 2003, we entered into a joint venture with our wholly owned Barbadian subsidiary Resin Systems International Ltd. and Euro Projects (LTTC) Ltd. pursuant to a joint venture agreement of the same date governing its and Resin International's exclusive world-wide right to commercialize existing and future technologies owned and developed by Euro-Projects on behalf of the joint venture in exchange for working capital contributions by us and the use of our manufacturing facilities.  At the same time and as part of the joint venture agreement, the parties entered into a technology license agreement governing the use of Euro-Project's existing and future technology, as well as an operating agreement with RS Technologies Inc., under which, RS Technologies Inc. conducts the day to day operations of the joint venture but as of May 31, 2004 have not entered into any business transactions under the joint venture.

In November 2003, our subsidiary New Version Sports Inc. (NVS) announced the that it had a licensing agreement with the Edmonton Oilers official retailers for distribution of individually numbered Heritage Classic hockey sticks.

In November 2003, we signed an Inventory Supply and Distribution Agreement with R.R. Interior Power & Electric Ltd. (RR) for our composite power and utility poles.  Under the agreement RR placed an initial order of 1500 composite poles with delivery of varying length poles.  The distribution agreement encompasses the province of British Columbia and the North West Territories.

In November 2003, we manufactured and delivered composite poles to Northwestel, a subsidiary of Bell Canada to facilitate a thirty-eight kilometer fiber optic installation in the Northwest Territories.  We manufactured and shipped over 250 poles of this order prior to December 31, 2003.  Northwestel had amended their initial order owing to the fact that they installed part of the fiber optic cable underground rather than overhead for no reason related to our product.

On December 29, 2003, we completed a private placement of 3,750,000 units at a price of $0.80 per unit for total gross proceeds of $3,000,000.  Each unit consisted of one common share and one common share purchase warrant, each whole common share purchase warrant entitled the holder thereof to acquire one common share at an exercise price of $1.00 per share at any time on or before June 29, 2004 and if exercised after that date but before December 29, 2004 the exercise price is $1.25 per share.  We are using the proceeds to commercialize the industrial and consumer products utilizing VersionTM resins and for working capital.



Capital Expenditures

For the four months ended December 31, 2003, we purchased a total of $602,779 in capital assets.  Of this total, $500,582 relates to  equipment for composite utility pole production and testing, $84,140 relates to computer hardware and software, $7,940 relates to office equipment and furniture to establish our Calgary office, and $10,117 relates to leasehold improvements for the Edmonton production facility.

For the fiscal year ended August 31, 2003, we purchased a total of $1,025,218 in capital assets of which, production and testing equipment accounted for $732,207 which is being used in composite utility pole production and testing, $215,361 relates to upgrading and expanding computer hardware and software, $14,970 relates to automotive equipment and the remaining $62,680 relates to office equipment, furniture and leasehold improvements.

During the fiscal year ended August 31, 2002, we purchased $121,591 of capital assets.  Of this amount, $55,150 relates to production and testing equipment, $27,000 relates to computer hardware and software and the remaining $39,441, relates to leasehold improvements.

B.

Business Overview

Our Business

As at the balance sheet date of the accompanying financial statements our business was considered as one business segment.  At this initial stage of our development, we are looking to move forward with several products as opportunities present themselves.

We have established RS Technologies, a division of Resin, which is responsible for the engineering, design, production and sale of our products, which at this time include the following:

Primarily we expect the development, engineering, production and sale of our proprietary line of unique, polyurethane-based, thermosetting resin systems under the VersionTM brand name to be one of the main focuses of our business.

Secondly, we are focusing on the development, engineering, manufacturing and sale of composite material products to the industrial and consumer marketplace that employ our VersionTM resins.  Our utility products are being sold under the brand RStandardä and our recreational consumer products are being sold under the brand NVSä (i.e. New Version Sport)

Thirdly, we have re-branded our Uni-sealä line of industrial coatings to become RSealä and concurrently, we are re-establishing the presence of these coatings in the marketplace.



I.

Sale of VersionTM Resins

Overview of the Composite Industry

What is a Composite?

Composites are broadly known as reinforced plastics.  Specifically, composites are a reinforcing fibre in a polymer matrix.  Most commonly, the reinforcing fibre is fiberglass.  The polymer matrix is typically a thermoset resin, with polyester, vinyl ester, and epoxy resins most often the matrix of choice.

Common household plastics, such as polyethylene, acrylic, and polystyrene are known as thermoplastics.  These materials may be heated and formed and can be re-heated and returned to a liquid state.  Composites typically use thermoset resins, which begin as liquid polymers and are converted to solids during the moulding process.  This process, known as cross linking, is irreversible giving composite materials manufactured using thermoset resins increased heat and chemical resistance, higher physical properties and greater structural durability than thermoplastics.

Use of Composites

Manufacturers, designers and engineers recognize the ability of composite materials to produce high-quality, durable, cost-effective products.  Composite materials are found in many of the products used in our day-to-day lives from the cars we drive, to the boats, recreational vehicles, skis and golf clubs that we use.  Additionally, composites are used in many critical industrial, aerospace and military applications.

Benefits of Composites

The benefits of composite materials have fueled growth of new applications in markets such as transportation, construction, corrosion-resistance, marine, infrastructure, consumer products, electrical, aircraft and aerospace, appliances and business equipment.  The benefits of using composite materials include:

High Strength

Composite materials can be designed to meet the specific strength requirements of an application.  A distinct advantage of composites, over other materials, is the ability to use many combinations of resins and reinforcements, and therefore custom tailor the mechanical and physical properties of a structure.

Light Weight

Composites offer materials that can be designed for both light weight and high strength usage.  Composites are used to produce the highest strength-to-weight ratio structures currently available.  This, in part, explains the transportation industry's high utilization rate for composites.  We believe that as energy efficiency requirements increase, building technologies that reduce weight, and at the same time increase payload, will be increasingly embraced.

Corrosion Resistance

Composites provide long-term resistance to severe chemical and temperature environments.  Composites are the material choice for outdoor exposure, chemical handling applications and severe environment service.

Design Flexibility

Composites have an advantage over other materials because they can be moulded into complex shapes at relatively low cost.  This flexibility offers designers extensive latitude in new product design.

Durability

Composite structures have an exceedingly long life span.  Coupled with low maintenance requirements, the longevity of composites is a benefit when used in critical applications.  In a half-century of composites development, well designed composite structures have yet to wear-out.

Our VersionTM Technology

Overview

The VersionTM family of resins are general purpose thermosetting resin designed by us specifically for pultrusion, filament winding and closed moulding composite manufacturing processes.  The system's physical, mechanical and economic properties taken as a whole are intended to be a direct replacement for existing polyester, vinylester and epoxy resins, all of which contain VOCs.  In addition, VersionTM resins were designed to permit the addition of recycled crumb rubber for increased environmental sensitivity.

To date, we have focused our efforts on the creation of a family of resin products targeted at specific performance requirements demanded by end users.

As previously noted, we entered into an agreement with the NRC in April 2002 under which the proceeds of a $400,000 repayable contribution from the NRC's Industrial Research Assistance Program will be used to accelerate development and commercialization of VersionTM family of resin products.  In March 2004, we arranged to amend the NRC agreement to increase the funding by $98,263 to $498,263.  Repayment terms pursuant to the original agreement have been extended to commence March 1, 2006 through December 1, 2010 rather than June 1, 2005 through March 1, 2010.  This amendment has facilitated further product development activities.

Features and Benefits of VersionTM Resins

As previously identified, we retained the ARC to conduct an independent study to compare the mechanical properties of traditional reinforced composite resins, such as polyester and epoxy, with our Versionä resin.  The ARC issued a report entitled "Mechanical Properties of Pultruded Polyurethane/Glass Composites" dated May 15, 2000 (the "ARC Study") which, in summary concluded that:

a.

with respect to ultimate tensile strength, which measures the amount of tension required to pull a product apart, the Versionä resins tested were 20% superior to polyester resins and 96% superior to epoxy resins;

b.

with respect to elongation at break, which measures stretch and the ability to bend before shattering, the Versionä resin tested was four times superior to polyester resins and 43% superior to epoxy resins;

c.

with respect to flexural strength, which measures the ability of a composite to flex under angular forces, considered to be a key property specified by manufacturers, the Versionä resin tested was two times superior to polyester resins and 33% superior to epoxy resins; and

d.

with respect to damage resistance strength, which measures the ability of a composite to withstand impact force, considered to be another key property specified by manufacturers, the Versionä resin tested was three times more resilient than polyester resins and 82% more resilient than epoxy resins.

In addition to the ARC Study, we have conducted and continue to conduct various beta site process tests and production trials at various facilities.  These tests have contributed significantly to our understanding of the Versionä resins, and confirmed many of the features and benefits that our product line offers.

As noted above, we entered into a collaborative research and development agreement with the ARC pursuant to which the ARC will provide $500,000 of research and development services to us in consideration for common shares.  The ARC's test centre capabilities were utilized to present evaluative and comparative product data for the Versionä family of resins which data will be used by us to promote the superiority of our resins from an engineering/design prospective.  This agreement was amended in early 2004, to extend the development work being done by ARC.  Under this amendment, ARC will extend its work by another $100,000, bringing total expenditures up to $600,000 and extending the time frame for the work from March 31, 2004 to June 30, 2004.

The chief features and benefits of VersionTM resins are set forth below.

Impact Resistance

The vast majority of composite materials are brittle in nature, and therefore, are subject to breakage in applications subject to impact forces.  Because VersionTM exhibits superior resilience and elongation properties, it is more damage resistant than competing resins.  This characteristic will permit end users of VersionTM resins to design new applications where high impact forces are anticipated.

Product Design Considerations and Unit Costs

Composites are, by definition, a combination of fiberglass and resin.  Fiberglass represents the more significant input expense and may amount to two-thirds of the overall inputs.  Versionä resins offer transverse strengths that are two to three times greater than those of many competing resins, and therefore allow engineers the opportunity to design composite parts using much more economical combinations of fiberglass, thereby reducing overall unit part costs.

Productivity and Unit Costs

VersionTM resins afford meaningful improvements in manufacturing productivity due to the chemical reaction dynamics (kinetics) of polyurethanes.  For example, in the pultrusion process, where polyester resins are typically pulled at 36 to 45 inches per minute, VersionTM resins have been pulled at speeds as high as 90 inches per minute, which translates into lower unit part costs.  In addition, Version® readily accepts the introduction of color pigmentation during processing or the application of paint to the finished product.

Secondary Processing

The elongation and impact properties of VersionTM resins permits composite parts to be nailed, drilled, screwed (using common screw fasteners without pre-drilling) or punched (on a punch press) to create holes of any size and shape.  These unique features will permit VersionTM resins to be used for the first time in construction applications that have to date been the sole domain of traditional building materials, such as wood, steel and aluminum.

Environmental Considerations

VersionTM resins are 100% VOC free.  Polyester and vinyl-ester based resin systems contain between 25% and 50% styrene, which is a VOC.  Manufacturers of composite parts are being subjected to increasing pressure by the EPA to reduce the use of VOC inputs, both for occupational health and environmental reasons.  End users of VersionTM resins will not be subject to HAP-related EPA reporting requirements, production ceilings and ancillary compliance costs, and will enjoy a healthier work environment.

Intellectual Property

We protect our intellectual property using a combination of patent protection, trademarks, licenses, non-disclosure agreements and contractual provisions.  This intellectual property includes information related to our VersionTM resins, our Rstandardä Utility Products, our Rsealä Coatings, our NVS recreational consumer products, as well as certain new technologies being developed together with our JV partners in the UK, namely Euro-Projects (LTTC) Ltd.

In view of the rapid technological change in the composite industry, the technical expertise and creative skills of our technical personnel are crucial in determining our future success.  Our ability to compete in the marketplace may be enhanced by our ability to protect our proprietary information through the ownership of patents, trade secrets, registrations and trademarks.  We attempt to protect our trade secrets and other proprietary information through agreements with customers and suppliers, proprietary information agreements with employees and other security measures.

However, although we intend to protect our rights vigorously, there can be no assurance that these measures will be successful.  Litigation may be necessary to enforce our patent, trademarks or other intellectual property rights, to protect our trade secrets, to determine the validity and scope of the proprietary rights of others or to defend against claims of infringement.  To date, no intellectual property of ours has been invalidated or declared unenforceable.

Patent Applications and Patent

Canada patent application serial number 2,310,166 was filed on May 29, 2000 in respect of "A Two Component Chemically Thermoset Composite Resin Matrix for Use in Composite Manufacturing Processes" (the "Canadian Patent Application").  Pursuant to an assignment by the original inventors of record the entire right, title and interest in the Canadian Patent Application was assigned to us as registered at the Canadian Patent Office on September 28, 2000 under registration number 05093065.

United States patent application serial number 09/609,008 was filed on July 26, 2000 in respect of "A Two Component Chemically Thermoset Composite Resin Matrix for Use in Composite Manufacturing Processes" (the "U.S. Patent Application").  Pursuant to an assignment by the original inventors of record, the entire right, title and interest in the U.S. Patent Application was assigned to us as registered in the United State Patent Office on June 26, 2000.  On July 16, 2003 the United States Patent Office issued us United States Patent No. 6,420,493 B1 entitled "Two Component Chemically Thermoset Composite Resin Matrix For Use In Composite Manufacturing Processes" and in doing so allowed all 37 claims contained in our U.S. Patent Application.

We have also commenced further patent applications that are related to our pole manufacturing processes.  This includes a continuation of certain patents originally filed by Canzeal but assigned to us as part of the January 2003 transaction referenced earlier.

In addition to this, we have been assigned the rights to certain patent applications as part of the joint venture relationship with Euro-Projects (LTTC) Ltd..

Trademarks

We obtained trademark registration from the United States Patent and Trademark Office and the Canadian Intellectual Property Office on February 2, 2002 and June 27, 2002, respectively, for VersionTM used in association with synthetic resins for use in the manufacture of moulding compounds.  On January 25, 2001, application for the VersionTM trademark was filed with the European Community Trademarks Office, asserting priority based on the earlier filed Canadian application.

Further trademarks have been applied for and have been awarded for the various resin based products such as NVSTM, RStandardTM, RSealTM.  As we develop further products, additional trademarks will be filed as we determine necessary to protect our interests.



Confidentiality Policy

In addition to our patent and trademark applications, we have taken steps to preserve our related intellect property, including know how and trade secrets, by adhering to a confidentiality policy.  The policy provides for the execution of confidentiality agreements by all of our employees, directors, officers and consultants.  The policy also provides that we shall enter into mutual non-disclosure agreements with all parties testing or working with the VersionTM resin system and with other proprietary products.  Physical security precautions in respect of the VersionTM resin formulations and product designs are also taken.

Strategic Alliances and Working Relationships

General

We are an emerging technology company in the chemical industry, a sector dominated by major corporations with international scope and significant resources.  As we determine necessary to accelerate the rate of market adoption and market penetration of our various products (including VersionTM resins) we may forge relationships with industry leaders, including chemical suppliers, chemical processors (such as pultruders and filament winders), chemical engineering firms, product design firms and end users.

Euro-Projects (LTTC) Ltd.

In August 2003, we entered into a joint venture with our wholly owned Barbadian subsidiary Resin Systems International Ltd. and Euro Projects (LTTC) Ltd. pursuant to a joint venture agreement of the same date governing its and Resin International's exclusive world-wide right to commercialize existing and future technologies owned and developed by Euro-Projects on behalf of the joint venture in exchange for working capital contributions by us combined with the use of our manufacturing facilities by the JV.

At the same time and as part of the JV agreement, the parties entered into a technology license agreement governing the use of Euro-Project's existing and future technology, as well as an operating agreement with RS Technologies Inc., under which RS Technologies Inc. conducts the day to day operations of the joint venture

The Dow Chemical Company

In mid 2002, we entered into a supply agreement with Dow Chemical Canada Inc., pursuant to which Dow agreed to supply us with some base chemicals we use to manufacture our VersionTM resins.  The agreement expired on December 31, 2003, but we have received verbal continuance of the supply agreement and Dow has made further deliveries at competitive rates and terms consistent since then.



Manufacturing and Distribution

Immediate demand for VersionTM resins will be filled from our Edmonton faculty.

In keeping with our technological and marketing focus, we intend to service international markets through licensing, manufacturing and distribution agreements with reputable chemical, processing and distribution companies possessing significant financial resources.

We do not believe that our business of blending and selling resin compounds is subject to any seasonal cycles or disruptions.  Most of the input chemicals used to manufacture thermosetting resins are commodities with pricing directly dependent on supply, demand and the cost of the underlying raw materials, in particular, the oil and natural gas and agriculture industries.  These raw materials are available from a number of suppliers.  Any increase in the price of these underlying raw materials tends to affect all resin manufacturers equally.

Marketing And Sales

Target Markets

General

We have continued to market VersionTM resins to various sectors of the composite industry.  Our marketing strategy has been to enhance, promote and support the fact that polyurethane-based composite products are unique and have the ability to solve the composite industry's environmental challenges in a cost effective way.

In order to enhance the exposure to our VersionTM resins, we have developed and will continue to develop markets to sell our products that are based upon our resin.

Pultrusion

The primary target market for VersionTM resin is the pultrusion industry.  VersionTM has been formulated as a direct replacement for traditional resins that currently dominate in this market segment.  The formulation of VersionTM resin allows the customer to use existing tooling, equipment, employees and procedures to satisfactorily and competitively manufacture parts, in the same manner as with traditional resins.

The pultrusion industry has been targeted for various reasons:

-

the inherent properties of thermosetting polyurethane based resin systems can be used to optimal advantage;

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the basic physical properties of the prototype VersionTM resins were proven to be equal or superior to traditional resins;

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increasing pressure to restrict the use of polyester resins, currently the resin of choice, is being brought to bear by regulators, including the United States Environmental Protection Agency;

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the pultrusion market has a long history of consistent growth, with most indicators pointing to continued or accelerating growth;

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products and processes that compete with pultrusion are experiencing greater than average cost increases;

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a few standard resin products can serve a large portion of this industry's needs;

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the market is not well supported by traditional suppliers of resin materials, either technically or commercially:

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the market has shown a willingness to accept new and innovative technologies;

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our key employees are very familiar with the technology and business aspects of this industry;

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the industry is small enough that it can be approached on a personal basis without the need for large marketing expenditures, indeed, many of the key contacts are personally known to our key personnel; and

-

the practices and technologies of this industry are generally uniform throughout the world.

Within the pultrusion industry there are several situations where switching to VersionTM resins may be used to advantage by the customer as compared to traditional resin systems:

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increased performance of an existing product.  If a customer is currently using vinyl-ester or epoxy resins, a switch will not result in a significant increase in cost, if any.  If the customer is using polyester resins, a minor increase in cost may be experienced;

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a product redesigned by us using VersionTM resins will enjoy the same or improved performance characteristics and will benefit from a lower cost combination of resin and reinforcements;

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improved processing speeds and other processing advantages will reduce the overhead component of a customer's product cost and improve production efficiencies;

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new product designs, based on the unique properties of VersionTM resins, will perform functions that are not physically possible, or not economically possible, using traditional resin systems;

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production problems due to cracking and warping of profiles from thermal stresses and shrinkage of traditional resins may be avoided and production speeds may be increased;

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limits on production due to environmental regulations imposed on traditional resin systems can be avoided and increased production rates enjoyed;

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workplace quality or health issues that threaten or limit production can be reduced or eliminated; and

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reduce or avoid the time and costs of obtaining environmental regulatory approval for new production facilities.  In certain instances, this may allow the construction of facilities in densely populated areas, which are closer to markets, labour and sources of input materials.

These factors alone, or in combination, may be important to pultruders depending upon their current situation.  VersionTM resins offer opportunities for increased profitability and productivity, however it will require an investment of time and creativity on the part of the customer to fully realize these benefits.  As part of our marketing strategy, we intend to  maintain a high level of technical business customer support to assist the customer in making the appropriate decisions necessary to maximize the benefits of the VersionTM resin systems.

Products made by pultruders are sold to a wide variety of industries.  These products have high structural strength, are corrosion and weather resistant, and are light in weight.  Pultruded products enjoy a wide acceptance within numerous industries including but not limited to: construction, water treatment and water cooling towers, electrical equipment, automotive, civil engineering and infrastructure.

A few specific examples of pultruded products include reinforcement bars for concrete structures, bridge decks, electrical transmission line components, light poles, transformers, I beams, ladders, tool handles and radio antennas.

Filament Winding

A significant potential market for the use of VersionTM resins is the composite process of filament winding.  The physical properties of Version's polyurethane based resin system are competitive with epoxy systems currently used in the filament winding process.  The superior toughness, impact resistance and flexibility of VersionTM resins will provide a significant advantage over traditional epoxy resins.

The largest market in the filament winding composite industry is the manufacture of small diameter pipe and tubing.  This tubing is used in a variety of industries, but its primary use is underground pipe where high strength and inherent corrosion resistance are important characteristics.  The primary pipe markets are petroleum exploration and production and chemical plant construction.  Other filament winding applications include wafer softeners, water heater tanks, large diameter pipe, electrical components, utility poles and pole extensions.

Within the filament winding industry, VersionTM resins can be used to advantage in the following situations:

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they can be substituted for epoxy resins to improve the impact resistance of pipe resulting in reduced damage during shipment and installation;

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they have has greater flexibility than pipe fabricated with traditional resin systems permitting them to be bent further before failure.  This is of particular advantage in the transportation, handling, storage and installation of piping systems; and

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the natural high reactivity of the VersionTM resin systems can allow for greater production speeds, with the potential to eliminate the curing cycle currently necessary for epoxy resin systems.

Resin Transfer Moulding

An additional target market is the closed moulding process known as Resin Transfer Moulding ("RTM").  This process has seen growing acceptance in recent years using resins such as polyester and vinyl-ester because it reduces (but does not eliminate) VOC emissions.  Use of VersionTM resins in the RTM process offers superior product performance and eliminates VOC's.

RTM is used to make complex shaped products from composite materials.  An example of a high volume RTM part is the hood and fender structures of large transport trucks.  These products are typically custom manufactured for a wide variety of industries, including automotive, marine, recreation, industrial, construction, infrastructure and aerospace.  The RTM process is typically chosen where a medium sized production run (1,000 to 100,000 units) is required for medium to large size parts, typically 0.5 square meters to five square meters surface area.

Advantages of VersionTM resins in the RTM process over traditional resins include:

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superior toughness and resistance to cracking;

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faster speeds and increased productivity;

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elimination of environmental issues associated with VOCs;

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improved dimensional stability and surface quality due to low shrinkage factors of VersionTM resins; and

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compatibility with existing moulds, tooling, equipment, training and procedures.

RTM is a lower cost alternative to the closed moulding processes of Reaction Injection Moulding and Structural Reaction Injection Moulding, both of which have been used extensively in the automotive industry to date.  Polyurethane based resins have been used extensively in both these processes.  Taken together, these factors indicate that VersionTM resins should experience positive market acceptance within the automotive industry.

Sales Force And Sales Strategy

During the past few years we have progressed from a pure research and development company with a VersionTM resin system to having a patented manufacturing process and marketable composite product lines.  Our technical and sales team has been growing as our newly implemented corporate strategy develops.  We intend to ensure that customer service and technical support are being supported in a professional and effective way from the outset.

In addition, we continue to hire additional operational staff as is warranted to support the build out of developing, engineering, manufacturing and marketing our composite material products, employing our VersionTM resin, to both the industrial marketplace (i.e. the composite utility pole division) as well as the consumer product marketplace.

Market Barriers

New entrants to the resin market place must overcome various barriers to entry.  VersionTM resin systems are formulated for specific composite manufacturing processes such as pultrusion, filament winding and resin transfer moulding.  Our personnel have in-depth technical and production knowledge of these processes.  The VersionTM resin systems are designed and have been confirmed to perform optimally in these specific processes.

Our primary target markets of pultrusion, filament winding and resin transfer moulding are specialized fields of composite manufacturing.  Major customers are relatively few in number, widely dispersed geographically and are not easily accessed through typical market channels.  Access to this market requires personal recognition, integrity and a sophisticated understanding of the factors that influence the processing method and the industry.  Our personnel have many years of experience within this industry and are able to approach key members of the group with a high degree of credibility.  New entrants to the composite resin market will need to establish a high level of credibility with decision makers in order to gain access to this market.

Resins for the composite industry are sophisticated chemical products.  Entrants to this market must have highly educated and experienced personnel with backgrounds in theoretical and production chemistry in order to provide the necessary technical support that customers demand.

The use and application of composite resin systems is also a technically sophisticated field.  Customer service expectations require advanced engineering and production expertise, not generally available from industry or educational institutions.  Our personnel have the necessary skills to provide prompt and thorough customer support for new product applications.

Identifying new entrants to the resin marketplace is primarily accomplished by participating in technical conferences and trade shows.  New entrants to the marketplace must possess the credibility to be invited to make presentations at such conferences and shows.  We have established, through our personnel and working relationships, the necessary credibility to gain access to these distribution channels.

In the future, as environmental regulation becomes increasingly onerous, industry participants that do not have the resources to advance their product offering through research and development may be forced from the marketplace.  The elimination of resins that contain HAPs, including styrene and other VOC's, will present a barrier to entry for new participants and may have a negative impact on existing participants.

Competitive Conditions

Competitive Companies

The resin industry can be segmented into three broad categories of competition: divisions of multinational conglomerates; diversified mid-sized producers and numerous specialized regional companies.  Market share is relatively fragmented with no single manufacturer holding a dominant position.

The multinationals and mid-size producers can offer anywhere from 10 to 50 formulations.  Customers select their resins from these standard products and either use them directly or modify them for use in their process.  In many cases, the competitive resin formulations are interchangeable between suppliers, resulting in "commodity" purchasing practices based on price.  Only a small number of resin formulations, specifically in the (relatively small) corrosion equipment fabrication market, are recognized and purchased on the basis of brand names.

The last decade has seen a consolidation in the composite resin supply industry.  The number of resin suppliers has dropped dramatically as larger companies have acquired smaller companies.  Consequently, fewer resin formulations are currently available compared to a decade ago.

Industrial composite resins are marketed either directly (to major customers) or through distributors.  Generally, major customers are considered to be in excess of U.S. $1 million in sales annually.  Direct marketing is generally based on tank truckload quantities.  Marketing through distributors is typified by drum or tote quantities.  Depending upon quantities, some customers may accept resin from several sources, mixing direct sales and distribution sales according to different needs.  Our prices for direct sales are generally based on year to year contracts, negotiated directly with the resin manufacturer.  Distribution sales are generally based on standard price lists, although discounts and rebates may be applied for larger customers.

In-depth technical service to the resin user is, in general, provided directly by the resin manufacturer, who is also able to support research and development departments in varying sizes.  We believe a significant threat to business success may come from research and development arms of multinational chemical companies, which have significant resources, both financial and technical, and are in the position to evaluate the scope and potential of the marketplace.





Competitive Products

General

In the pultrusion and filament winding industry, the major competitors to VersionTM resins include any of the traditional thermosetting resin materials: polyester, vinyl-ester and epoxy.  Polyesters have generally good physical properties and can be used in a wide variety of applications.  Their major limitation is that they are somewhat brittle materials and have relatively poor strength properties.  Vinyl-ester and epoxy resins are generally stronger, and give improved properties of shear and transverse strength, compared to polyester.  Typical vinylester and epoxy pricing is 150% to 250% of the cost off polyester materials.

Phenolics

In certain pultrusion and filament winding applications phenolic resins are used.  The primary advantage of phenolics is their resistance to fire, however they are generally more brittle and weaker than polyester resins.  We anticipate that the natural fire retarding capabilities of certain formulations of Version® resin can be applied to products requiring fire resistance.  Phenolic resins would be considered competitors to such formulations.  Currently, only a very small amount of phenolic resin is used in the industrial composites field, and as such the pricing of the resin is consistent with small volume, specialty products, and is therefore more costly than Version® resins.

Epoxies

Although epoxies have been used extensively in the aerospace industry, their use in industrial composites has been limited.  The exception is small diameter filament wound pipe where epoxies have been the material of choice due to higher strength and impact resistance.  Many of the same factors that favour the use of VersionTM resins, also favour epoxies.  Like Version® resins, epoxies do not contain VOC's and are relatively easy to handle, ship and store.  Epoxies can be formulated for extended curing times, which current VersionTM resins cannot.  Conversely, epoxies need extended elevated cure cycles to reach maximum properties whereas VersionTM resins can be cured quickly at room or slightly elevated temperatures.  In general, epoxies are more difficult to process and cure than VersionTM resins.  Epoxies have experienced a rapid growth in the industrial composites industry in recent years, generally at the expense of polyesters.  Epoxies have the potential to compete with VersionTM resins, especially if epoxy pricing can be reduced to approximate polyester pricing.

Thermoplastics

Although the vast majority of industrial composite materials are thermosetting resins, there have been recent developments of composite materials using thermoplastic materials.  Thermoplastic versions of both urethane and polyester chemistries, as well as more common thermoplastic materials such as polyethylene and polypropylene, have been demonstrated in the pultrusion process.  These thermoplastics have significant cost advantages over traditional thermosetting materials, generally costing 30% to 50% of those materials.  Processing speeds can be quite high, although to date this has been limited to thin profiles (eg.  Sheeting).  An advantage of the thermoplastic pultrusion samples examined to date is that they have very high toughness and impact resistance.  Disadvantages include poor surface quality, porosity, relatively low strength, poor weather resistance and limited application under high temperature conditions (150° Fahrenheit and above).

Specific examples of thermoplastic pultrusion products are "Fulcrum" manufactured by The Dow Chemical Company and "Twintex" by Saint-Gobain Vetrotex America, Inc. These products may compete with Version® resins as thermoplastic technology further develops and prices are reduced.

Substitutes

There are several substitute materials that can be viewed as competition to composite materials.  These include traditional building materials such as wood, steel, aluminium, plastics and reinforced concrete.  Currently, aluminium is the material that is most directly substitutable for pultruded composite materials, although in certain circumstances wood and steel may be alternate materials.  With recent rises in energy prices, aluminium has become relatively more expensive; opening the door for substitution by pultruded resin products.  However, a reduction in the cost of aluminium may result in customers returning to aluminium for certain applications.

Environmental Compliance

In terms of environmental regulation, it is possible for manufacturers utilizing traditional resins to reduce emission levels by installing and operating suitable pollution control equipment.  However, this equipment is costly to purchase and operate, and does not completely remove all hazards or regulatory compliance issues associated with VOC's.

Raw Materials

We have used and are using numerous suppliers to acquire the chemicals required to produce VersionTM resin.  In our opinion, we are not at risk of non-supply from any one supplier as we have the capability to switch suppliers for any particular chemical component of VersionTM resin.  The risk, if any, relates to pricing of the chemical components.  We believe we are receiving favourable price discounts by utilizing one supplier for a particular number of the required chemicals thereby increasing the volume of chemicals purchased from one source which in turn maximizes the price discount that we receive.  Should there be an issue of supply we will not hesitate to find alternative suppliers of raw chemical inputs.

II.

Sale of Products made from Our VersionTM Resins

Overview

During the last few years our initial focus on industrial coatings and resin development has been broadened to encompass market driven production and distribution efforts.  In an effort to accelerate the entry of our VersionTM resin into the marketplace we are directly developing, engineering, manufacturing and supplying composite material products, as well as employing our VersionTM resin to both the industrial and consumer marketplace.

As one example of this, we have developed manufacturing processes at our Edmonton facilities that enable us to manufacture composite utility poles and light standards.

On August 30, 2003, we entered into a joint venture with its wholly owned Barbadian subsidiary, Resin Systems International Ltd., and Euro-Projects (LTTC) Ltd. pursuant to a joint venture agreement of the same date governing its and Resin International's exclusive world-wide right to commercialize existing and future technologies owned and developed by Euro-Projects on behalf of the joint venture in exchange for working capital contributions by us and the use of our manufacturing facilities.  At the same time and as part of the joint venture agreement, the parties entered into a technology license agreement governing the use of Euro-Project's technology, as well as an operating agreement with RS Technologies Inc., a wholly-owned subsidiary of ours, engaging RS Technologies Inc. to conduct the day-to-day operations of the joint venture.

Set forth below are composite products which we are currently producing and intend on producing during 2004.

Composite Utility Poles (Rstandardä)

In the spring of 2002 we commenced working with a customer, Canzeal Enterprises Ltd., to assist them with manufacturing composite utility and light poles utilizing VersionTM resin.  Canzeal had developed a filament winding process utilizing VersionTM resin to produce prototype composite poles that were highly competitive with existing poles.  Our work with Canzeal led us to commission a study during the fourth quarter of calendar 2002 on the economic viability of the North American utility pole market.

In January 2003 we completed the arm's length acquisition of the worldwide right, title and interest in and to all intellectual property assets of Canzeal related to the design, manufacture and distribution of composite poles.

We have developed and have filed patent applications on the filament winding technology that allows us to manufacture a composite material utility pole with many unique advantages.  We believe our composite material poles are significantly stronger, lighter and have a longer lifespan than traditional wood, steel or concrete-based utility poles.  The reduced weight of our poles results in decreased installation and transportation costs.

While wood poles remain the lowest cost alternative strictly on an up front unit-price basis.  The significantly lower installation and maintenance costs, longer life, and drastically reduced environmental impact for the Rstandardä poles make our poles competitive.  Furthermore, wood is a "natural" product and as such each wood pole will react differently to a similar loading pattern.  Conversely, our composite poles are manufactured and engineered products and as such engineers can easily anticipate pole characteristics when designing a utility line.

In addition to the technical aspects, wood poles require logging activities to produce the raw material, and environmentally damaging preservatives to lengthen its life to less than half the life of a composite pole.  Wood poles are heavier, making them more costly to transport and install.

Steel is a better choice than wood (from the perspective of it being an engineered product), but it is still not an overall cost effective alternative to our pole, especially in periods of high steel prices.  Steel is also heavier, requires corrosion treatment for longevity, has higher installation costs, and  just as with a wood pole  requires a grounding system to handle electrical discharges from lightning.

While concrete poles offer some advantages over wood, their tremendous weight can increase transportation and installation costs by as much as 80%.  In addition, concrete poles are also subject to corrosion as well as the effect of freeze/thaw cycles in many climates.

We are in the process of installing new production equipment at our Edmonton facility to increase our unit rate of pole production from the current rates of one pole per hour.  We intend to improve the rate of production by the end of this year.  As our production rates increase, unit costs per pole will decline to rates comparable with a wood pole  effectively removing the last remaining cost advantage for wooden poles.

On January 9, 2003, we entered into a distribution and option for manufacturing agreement with Harwell Hesco Electric Supply Co.  Limited, an Ontario corporation, appointing Harwell Hesco as the eastern Canadian distributor of our composite poles and granting Harwell Hesco an option to become our exclusive agent entitled to manufacture and supply our composite poles in eastern Canada.  The initial term of the agreement is for two years, which is extendible by mutual agreement between the parties.

We entered into an inventory supply and distribution agreement with R.R.  Interior Power & Electric Ltd. in November 2003 pursuant to which Interior Power provided us with an initial order for 1,500 composite poles in varying lengths.  The distribution agreement encompasses the Province of British Columbia and the North West Territories.  Interior Power is a long established British Columbia based company specializing in the construction and maintenance of overhead and underground electrical transmission as well as distribution power lines.

In November 2003, we manufactured and delivered composite poles to Northwestel, a subsidiary of Bell Canada to facilitate a thirty-eight kilometer fiber optic installation in the Northwest Territories.  We manufactured and shipped over 250 poles of this order prior to December 31, 2003.  Northwestel had amended their initial order owing to the fact that they installed part of the fiber optic cable underground rather than overhead for no reason related to our product.

Lighting Standards (Rstandardä)

We intend to use our Version® resin and utility pole manufacturing process to produce light standards.  We believe our patented VersionTM resin and our patent pending utility pole manufacturing process will provide us with similar advantages in the manufacture of lighting standards, including economic benefits unrealized in wood, concrete or steel.  In addition, we believe the unique engineering of our composite material lighting standards will provide the benefit of "passive safety".  That is a roadside collision with existing heavy light standards exposes drivers to significantly more additional damage and risk than the same collision with our lighter composite pole.  Our pole is designed to sheer off on contact with a vehicle.  At the same time by comparison, impact damage to wood, steel or concrete poles is far greater than impact damage sustained by our poles.

Composite Hockey Stick Shafts (NVSä)

We are producing a seamless composite hockey stick shaft utilizing a combination of the inherent advantages of VersionTM resin and a proprietary manufacturing technique.  We believe that our NVS hockey stick shafts are significantly more resilient than competing products in terms of impact strength, and that they enhance the player's "feel" of the puck while stick handling, passing and shooting.

All Terrain Boards

We are in the process of working with our Euro-Project JV partner to further develop an all-terrain skateboard.  Our Hillbilly All Terrain Board is a high-end all-terrain board offering light-weight composite construction and increased strength and flexibility.  Our board is virtually indestructible, and uses 100% recyclable materials.  Preliminary finished product is currently undergoing testing, and release of this product to the North America market is planned for 2004.

C.

Organizational Structure

We have seven subsidiary companies of which six are wholly owned and one is 85% owned.  The wholly owned subsidiaries are Resin Systems Incorporated, a Delaware Corporation, Resin Systems International Ltd., a Barbados Company, Resin Systems Sales Limited, an Ireland based company, Uni-Seal USA Ltd., a Wisconsin company, RS Technologies Inc., and New Version Sport Inc., both Canadian companies.  The 85% owned subsidiary is Uni-Seal Moulding Technologies Inc., a Canadian company.  All of the subsidiaries are inactive at this time, with the exception of Resin Systems International Ltd. and New Version Sport Inc.

During the first quarter of 2004, we expanded our base of operations to include a divisional office in Calgary operating as RS Technologies.  The division was established to develop, engineer, design, manufacture and sell our products.

D.

Property, Plant and Equipment

Research and development and blending of VersionTM resin takes place at our 21,000 square foot blending plant which also serves as the head office located at 14604 - 115A Avenue, Edmonton, Alberta, T5M 3C5.  The primary lease on this property expires on January 31, 2007.  We have the option to extend the lease for a further five years.  Additionally, we are leasing a production plant which currently being outfitted in Edmonton for the exclusive production of utility poles.  This facility is 34,900 square feet and came on stream in the first quarter of calendar 2004.  The primary lease for this facility expires on March 31, 2005.  Finally, we have established divisional offices in Calgary to handle our day-to-day operations of as well as certain future oriented projects.  The initial term of the lease is for seven years with two five year renewal options.

ITEM 5.

OPERATING AND FINANCIAL REVIEW AND PROSPECTS

This discussion and analysis of our operating results and financial position should be read in conjunction with the consolidated financial statements and the notes thereto forming a part of this statement.  Additionally, the reader should refer to the sections entitled "Risk Factors" and "Selected Financial Data" in this document.  In addition to historical information referred to as at a particular financial statement date, the following discussion will contain management's interpretation of events that have occurred subsequent to that date.

The financial statements presented utilize Cdn. GAAP and any differences between Cdn. GAAP and U.S. GAAP are addressed in Note 19 of the December 31, 2003, August 31, 2003 and 2002 financial statements.  In utilizing Cdn. GAAP, we are required to make certain estimates, judgments and assumptions that we believe are reasonable based upon the information available.  These estimates and assumptions are based on managements historical experience and various other assumptions that are believed to be reasonable under the circumstances.  These affect the reported amounts of the 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 periods presented.  Actual results could differ from these estimates.  The recoverable values of the inventories, property, plant and equipment and intangible assets, and the estimated useful lives of property, plant and equipment and intangible assets, are the more significant items subject to estimates in the financial statements.

We have identified the accounting policies outlined below as critical to our business operations and an understanding of our results from operations.

Our Audit Committee reviews our accounting policies.  The Audit Committee also reviews all quarterly and annual financial statements and recommends adoption of the annual financial statements to the Board of Directors.  For a detailed discussion on the application of these and other accounting policies, which are reviewed by the Audit Committee, see Note 2 of the accompanying consolidated financial statements.

Revenue Recognition

We recognize revenue when transfer of legal title to our products has occurred.  Upon transfer of title, the risk of any loss is assumed by the customer and when this condition of sale has been met, we recognize revenue associated with the transaction.

Allowance for Doubtful Accounts

We report our accounts receivable net of allowance for doubtful accounts and accounts that have been written off directly to expense as they become uncollectible during a fiscal year.  Estimation of the allowance is based upon managements analysis of individual customers and the likelihood of collecting each account based upon the age of the outstanding amount, conditions relating to the transaction and specific invoices.

Intangible Assets

In 2001, the Canadian Institute of Chartered Accountants (CICA) issued handbook Section 3062, Goodwill and Other Intangible Assets.  Goodwill and intangible assets with indefinite useful lives are no longer amortized, but instead are tested for impairment at least annually by comparing their fair values with their book values.  The new standard does not change the accounting for intangible assets with determinable lives, which continue to be amortized over their estimated useful lives and are tested for impairment by comparing their book values with the undiscounted cash flow expected to be received from their use.  The Company adopted this new standard effective September 1, 2002.



Intangible assets are recorded at cost and their carrying value is assessed for future recoverability or impairment on an annual basis.  When the net carrying amount of an intangible asset exceeds the estimated net recoverable amount, the asset is written down with a charge against income in the period that such determination is made.  These assets are amortized at a rate of 20% using the declining balance method which is consistent with the tangible assets used employing the intangible asset.



Stock-Based Compensation

Effective September 1, 2002, we adopted the new recommendations of CICA with respect to the accounting for stock-based compensation and other stock-based payments.  The new standards are applied prospectively to all stock-based payments to non-employees and to employee awards that are direct awards of stock, call for settlement in cash or other assets, or are stock appreciation rights that call for settlement by the issuance of equity instruments, granted on or after September 1, 2002, except grants outstanding at September 1, 2002 that call for settlement in cash or other assets or stock appreciation rights that call for settlement in equity instruments.  For such grants, the new standards are applied retroactively, without restatement.  As the Company had no such grants, there has been no adjustment to retained earnings, liabilities, or contributed surplus as at September 1, 2002.

The Company accounts for all stock-based payments to non-employees, and employee awards that are direct awards of stock, call for settlement in cash or other assets, or are stock appreciation rights that call for settlement by the issuance of equity instruments, granted on or after September 1, 2002, using the fair value based method.  No compensation cost is recorded for all other stock-based employee compensation awards.  Consideration paid by employees on the exercise of the stock options is recorded as share capital.



The Company discloses the pro forma effect of stock options granted to employees under the fair value based method (note 9(b) of the financial statements).  No disclosure has been made for the pro forma effect of awards granted before September 1, 2002.



Overview

Historically our primary source of revenue has been from our proprietary Rsealä line of coating products (formerly Uni-Sealä).  We have had limited success with this product for numerous reasons and, the main reason being, the time-line required for customers to adopt an industrial coating.  This time-line requires that sample test projects outperform the customers existing product of choice and this usually is measured in years.

As an outgrowth of the Rsealä (formerly Uni-SealTM) industrial coatings, we have developed VersionTM resin that does not contain any VOC's.  In fiscal 2000, we concentrated our efforts on the further development and pre-commercialization of our VersionTM composite resin.  We have continued to service existing industrial coatings customers and have recently begun to pursue expansion of this segment due to our limited success with this product.

During the four month period ended December 31, 2003, we fulfilled our first utility pole order, which we are marketing under the identifier, Rstandardä.  We also filled numerous resin orders and continued with sales of our composite hockey shaft including the commemorative Molson Canadian Heritage Classic hockey stick for the game held in Edmonton on November 22, 2003. Additionally, we obtained regulatory approval to change our fiscal year end from August 31 to December 31 in order to facilitate comparison of results with others in our industry.

During fiscal 2003, we narrowed our focus and strategy from being a supplier of materials in other firms operations, to being capable of delivering finished products to the marketplace utilizing our VersionTM resin system.  During the first quarter, management commissioned a report from a third party on the market for utility poles in North America.  The reason behind the report stems from talks with a customer who had developed equipment to produce poles using our VersionTM resin system.

This report indicated the size of the market was approximately U.S. $2.8 billion, which in managements opinion, was a worthy market to enter with our proprietary resin and composite pole technology.  In the second quarter of the year we completed a transaction with Canzeal Enterprises Ltd. for the filament winding technology relating to composite pole manufacture.  For the remainder of the year we concentrated on developing manufacturing procedures and infrastructure for utility poles and completed testing of them in order to meet industry specifications.

Additionally, we made strides in the development of composite hockey shafts using our VersionTM resin system.  We have set up NVSä to commence marketing those shafts. During our third quarter, we marketed the NVS hockey shafts through various organizations and web sales.

In the coming year we intend to manufacture composite utility poles of various types, expand our hockey product line and develop other related products utilizing our VersionTM resin system.  Additionally, we intend to expand our sales and marketing network to sell and distribute these products.

A.

Operating Results

Four Months Ended December 31, 2003 Compared With Fiscal Year Ended August 31, 2003.

In reviewing the results of the four month period ended December 31, 2003 with results for the year ended August 31, 2003, the reader is advised that comparison between the two periods needs to be tempered with the knowledge that during the four month period the Company was heavily involved in the commercialization of its products and that staffing levels for the period were higher than was evident for all except the last four months for the year ended August 31, 2003.

Product revenues increased approximately 69% or $184,526 over for the previous year.  This increase relates to completion of the Companys first utility pole order and continued with sales of its composite hockey shaft, including the commemorative Molson Canadian Heritage Classic hockey stick for the game held in Edmonton on November 22, 2003.  Other revenues were approximately 81% lower or $34,917, owing to reduced interest received which is a function of both time and cash on hand.

Total operating expenses for the period were approximately 32% or $1,545,197 lower than those of August 31, 2003.  On an annualized basis one would expect this decrease to be approximately twice the reduction, given that, the December results represent a third of a year and the August results are a full twelve months.  The fundamental reason for this discrepancy is that the Company is establishing its in-house infrastructure for production of utility poles, resin supply and hockey shaft manufacture and this has had a dramatic increase in the number of personnel required to facilitate this production.  Additionally, the Company is in the process of developing markets for these and future products.

Cost of sales increased $215,566 or 182% over August 31, 2003.  The increase is related to the mix of products sold for the period and that margin levels relate to the introduction of some products.

Direct and product development costs are approximately $404,653 or 26% lower than those for the previous year.  This disproportionate decrease relates to the addition of personnel and their training in production operations and preparing for further production.  During the period we spent an additional $103,017 with the ARC and $41,849 with the NRC which is referenced in the accompanying financial statements.

Marketing and business development expenses are approximately $136,199 (26%) lower than previous year.  For the period increased expenses relate to the marketing of our hockey products and the establishment of a distribution system for next season.  Additionally, costs were incurred for the identification of an initial utility pole market and the establishment of a distribution system for their sale.

General administrative costs for the period are $742,448 (37%) lower than year ended August 31, 2003.  The Company had a complement of staff in this category during the period and only part of the complement for the year ended August 31, 2003.  During the period the Company experienced an increase of expenses related to compliance with regulatory agencies of approximately $50,000.

Interest and other charges are $14,084 (38%) lower than fiscal 2003 and related almost entirely to foreign exchange expenses owing to the strengthened Canadian dollar over the United States dollar.

Amortization of tangible and intangible assets is $463,000 or 71% lower than that of August 31, 2003 and is what would be expected given the function of amortization being time and declining balance.

U.S. GAAP Reconciliation

Note 19 of the accompanying financial statements presents a summary of the differences between Cdn. GAAP and U.S. GAAP as applied to such financial statements.



Fiscal Year Ended August 31, 2003 Compared With Fiscal Year Ended August 31, 2002.

Operating revenues for the year saw the reduction over the previous year of $31,446 or 9%.  This slight decrease was a mix of increases in composite and hockey shaft sales and a decrease in Rsealä (formerly Uni-Sealä) and other revenues.

Total expenses increased $2,848,966 over the previous year partly owing to the establishment of an infrastructure and the testing required for entry into the utility pole and hockey shaft markets.  Additionally, we incurred the costs of becoming a registrant under the United States Securities Exchange Act of 1934 as well as, the costs required to remain compliant as a public company.

Cost of sales decreased $98,449 or 45% owing to the mix of products sold during the year.  Hockey shafts and resin sales have higher margins than our coatings products and reflect this shift in cost of sales.

Direct and product development costs increased $920,148 or 146% over last year.  Of this difference $263,948 relate to direct charges in the establishment of procedures in producing utility poles.  Another $635,355 relate to research and development of new resins, testing of the utility poles to ensure they are within specifications, as well as investigation of different processing for future products.  Included in this $635,000 difference is approximately $310,000 of stock based compensation which is a direct result in changes in Cdn. GAAP for fiscal 2003 which was not included in fiscal 2002.  Of the total $920,000 increase, we spent $253,172 with the Alberta Research Council ("ARC") and $305,805 with the National Research Council ("NRC") which are referenced in the accompanying financial statements.

Marketing and business development expenses increased $210,028 or 67% over last year primarily owing to costs to establish a market of our new hockey stick shaft.  Included in the $210,000 difference for 2003 is $46,008 in stock based compensation which as referred to above is a change in Cdn. GAAP and which was not included in the results for fiscal 2002.

General and administrative expenses increased $1,196,814 or 147% over the same period last year for the following reasons.  Payroll costs increased $506,400 in fiscal 2003 of which $98,253 is a result of stock based compensation which is a new Cdn. GAAP requirement and not included in fiscal 2002.  The balance of approximately $408,000 relates to an increase in the number of staff arising from the increased complexity of our business as we prepare for moving into a new business sector.  Professional fees and consultant fees increased $444,000 owing to new reporting and compliancerequirements in Canada and the United States that public companies are required to comply with and the finalization of our company becoming a registrant under the United States Securities Exchange Act of 1934.  The remaining $246,000 includes a Bad Debts charge of $80,000 and general increases in the cost of doing business.

Interest and other charges increased $27,680 or 304% over the previous year and relate entirely to foreign exchange charges incurred.

Amortization increased $592,745 or 949% as a direct result of the increase in property, plant and equipment that we have been building in relation to utility poles and $411,500 in the amortization of the filament winding technology which we purchased in January 2003.

Our Net Loss is approximately $2,868,000 higher than fiscal 2002 owing to the factors expanded upon above in relation to development of new products and infrastructure.

Other Items

Foreign currency fluctuations have historically had minimal impact on our business.  We endeavor to balance internally, inflows and outflows of funds based in U.S. currency.  This is accomplished through our U.S. customer base and the fact that a small segment of our suppliers are U.S. based.

There are no governmental factors that we are aware of that materially adversely effect the way we do business.

Fiscal Year Ended August 31, 2002 Compared With Fiscal Year Ended August 31, 2001.

During the fiscal year ended August 31, 2002, we revised our  operations and instituted a new business plan.  As a result of this revision, we closed our U.S. office and reduced our staffing levels in both the U.S. and Canada.  Our primary reason for these reductions was due to the poor economic outlook for the composite industry in the United States atthat time and the lack of significant in-roads we had made in the composite market prior to these reductions.

In accordance with our revised business plan we extended the use of our in-house pultrusion equipment previously used exclusively for research and development, to produce end user composite pultruded parts.  To this end, we received a minimum annual commitment of $500,000 from a United States based construction supply firm.  Management anticipated that this commitment would commence immediately and that it would spur the adoption of our VersionTM resin system in the composite market.  This commitment was seen as moving us into the end product manufacturing sector and adding another dimension to our set of capabilities.  As the year progressed, the construction firm took delivery of less than 4% of this minimum commitment.  We viewed the cost of litigation to establish damages as not economically feasible.

Additionally, we sold our Uni-Seal USA Ltd. subsidiary's land and building for gross proceeds of U.S. $75,000.

Operations in the opinion of management constitute one business segment.

Revenues for the fiscal year ended 2002 were 27% or $74,000 higher than those for 2001 as a result of the poor economic outlook in composites and in spite of a long cool spring in 2001 which is detrimental to coatings sales.

Total expenses before under-noted items were down marginally, $7,736, owing to increases in cost of sales, direct and product development, and amortization, while all other expense captions have reported deceases.

Cost of sales as a percentage of revenue was higher by 9% owing exclusively to product mix.

Direct and product development expenses increased $468,151 over last year as a result of our development of two new VersionTM resins as well as, the retention of the ARC to provide testing data on the VersionTM line.  The initial expense for ARC was approximately $185,000.  Another contributing factor to this increase was the reconfiguring of our operations to do "in-house" pultrusion.

Marketing and business development costs decreased $231,155.  This decrease is mainly due to the closing of the U.S. office and the reduction of personnel in Canada and the U.S. for this caption.

General and administration expenses decreased $279,092.  This decrease is attributable to a reduction in staff in the Edmonton office amounting to approximately $140,000 and reduced professional fees.  In fiscal 2001, we spent significant sums in making application to the United States Securities and Exchange Commission as well as preparation of debenture financing documentation.

Interest and other charges recorded a reduction of $40,607 owing to the conversion of previous note payable debt into equity as disclosed in notes 8 and 9 in the accompanying consolidated financial statements.

Write-down of capital and intangible assets were significantly lower than 2001 due to the fact that in 2001 we wrote down our development costs relating to Version® resin which had been previously capitalized.  In fiscal 2002 we wrote down the lease-hold improvements we had capitalized while in our former location in Edmonton.

Our net loss for the 2002 fiscal year was down approximately $888,000, or 34% lower, than in fiscal 2001, primarily due to the write-down of intangible assets mentioned above.

B.

Liquidity and Capital Resources

Our chief source of cash flow to date has been through the issuance of our securities.  Since December 31, 2003, we completed a private placement of 8,272,909 common shares for gross proceeds of $9,513,845 and raised an additional $3,051,248 from shareholders exercising warrants from a previous share issue.  With these additional common shares issued subsequent to the period end and the planned execution of our business plan, we believe that we have sufficient resources to fund operations for the next year.



For the period ended December 31, 2003, we sustained a cash deficit from operations of $3,743,891.  This deficit was primarily due to our focus on the infrastructure we require to produce and market our utility poles and hockey sticks.  During the period we raised $3,136,302 through a private placement net of transaction costs and received a further $41,489 from the NRC for assistance with our research and development costs.  We also have obtained extended funding through NRC expanding the amount from $400,000 to $498,263, which will be utilized in fiscal 2004.  These funds are primarily a loan which is to be repaid at a rate of 1.9% of gross quarterly revenues, earned from March 1, 2006 through December 1, 2010.  ARC provided us with $103,017 worth of testing information which is being funded through the issuance of common shares as per our agreement.  ARC has also extended the participation with us and increased their commitment by $100,000 which is funded under the same conditions.

Subsequent to December 31, 2003, we raised $3,051,248 when shareholders exercised 4,068,330 warrants out of a possible 4,500,000 in January 2004.  Additionally, by June 2, 2003 we had raised gross proceeds of $9,513,845 through the issuance of 8,272,909 common shares in a private placement.  This placement consisted of one common share and one half common share warrant exercisable at a $1.50 per share within in a year of the closing date.

With these financings and the planned execution of our business plan, we believe that we have sufficient resources to fund operations for the next year.

We are currently finalizing our listing requirements for listing on the American Stock Exchange (AMEX).  We expect to obtain listing approval early in the third quarter of 2004.

We do not engage in any hedging or currency trading activities.  Our business activities are conducted in Cdn. And U.S. dollars and our assets and liabilities are recorded in Cdn. Dollars.  Approximately 50% of our sales revenue is in U.S. dollars and substantially all of our costs of sales and administrative costs are in Cdn. Dollars.  We have no U.S. dollar denominated assets other than accounts receivable related to U.S. dollar revenues.  U.S. dollar revenues have been less than $250,000 annually for each of the last three fiscal years.  As our accounts payable are in Cdn. Dollars and some of our accounts receivable are in U.S. dollars, any appreciation in the value of the Cdn. Dollar against the U.S. dollar would result in an exchange loss.

We monitor foreign exchange rates but have not taken action to date to reduce our exposure to significant fluctuations in currency exchange rates.  Management will review our exposure and will take such remedial steps as it considers necessary.

Our interest expenses and income are subject to changes in interest rates.  Management has determined that fluctuation of up to 10% in interest rates would not materially affect our financial position or results of operations.



For the year ended August 31, 2003, we sustained a cash deficit from operations of $3,046,115.  This deficit is due to the fact that we are developing end products for our VersionTM resin system which management believes, will bolster demand for the product as other manufacturers see the beneficial properties it can bring to the final product.  To sustain operations and move forward with our objectives in fiscal 2003, we raised $5,493,897 net of transaction costs through the sale of common shares and received $305,805 in proceeds from the NRC for assistance with our research and development costs.  These funds are primarily a loan which is to be repaid at a rate of 1.9% of gross quarterly revenues, earned from June 1, 2005 through June 1, 2015. NRC has contributed $343,435 as at August 31, 2003 (see note 16(b) in accompanying financial statements).  Additionally, we obtained $253,172 worth of testing information from the ARC to mitigate the necessity of funding this testing from cash flow.  Under this agreement, ARC provides a maximum of $500,000 worth of services to us in exchange for equal installments of $125,000 worth of common shares based upon a formula in the agreement related to share pricing.  As at August 31, 2003, we had cumulatively used approximately $380,000 of ARC services and had only the fourth installment left to be used at that date (see note 16(c) in the accompanying financial statements).

By the middle of January 2004, we raised an additional Cdn. $6,000,000 through a private placement share issue and the exercise of warrants.  We expect that these funds will be sufficient to finance our budgeted operating costs, development, marketing and anticipated discretionary expenditures for the next six months.  It is the opinion of management, that we will require an additional Cdn. $10,000,000 to complete expansion plans for composite pole manufacture, establish a marketing and distribution system for VersionTM resin system and our hockey shafts, fund infrastructure completion and meet other working capital requirements.  We intend to obtain the funds necessary to complete our expansion through private placements of our common shares, but we cannot assure you that we will be successful in completing such private placements on commercially reasonable terms.

During fiscal 2003 and expected in 2004, management believes that the new focus on end-products will generate the funds needed through greatly improved sales and sufficient margins to ultimately eliminate the dependence on the issuing of securities to finance our operations.

As at the date of this filing our only long-term debt relates to the government assistance with NRC.  Under this arrangement we have receive over $400,000 for pre-commercialization of our VersionTM resins.  We are required to repay these funds commencing June 1, 2005 at the rate of 1.9% of gross revenue (see note 16 in the accompanying financial statements).  As per the note, we are within the terms of the agreement and repayments commence the quarter commencing June 1, 2005.

C.

Research and Development, Patents and Licenses

Research and development has represented a major investment for us in past years.  For the year ended August 31, 2001, we spent $163,891, on direct and product development expense, with another $632,042 spent during the year ended August 31, 2002.  While the research phase for our VersionTM resin program is substantially complete, ongoing product development and testing will remain a key activity for us.  During the year ended August 31, 2003, we focused our attention on processes related to Rstandardä utility poles (manufacturing) and on delivery of the end product.  We also expended $635,355 on development of new resins and testing of the utility poles to ensure that they are within specifications, as well as expended efforts on, other processing applications for future products.

We protect our intellectual property using a combination of patent protection, trademarks, licenses, non-disclosure agreements and contractual provisions.  The original inventors of record have assigned the Canadian and US patents for VersionTM to us.

We have also commenced further patent applications that are related to our pole manufacturing processes.  This includes a continuation of certain patents originally filed by Canzeal but assigned to us as part of the January 2003 transaction referenced earlier.

In addition to this, we have been assigned the rights to certain patent applications as part of the joint venture relationship with Euro-Projects (LTTC) Ltd. but as of May 31, 2004 have not entered into any business transactions under the joint venture.

Trademarks

We obtained Canadian and US trademark registrations for VersionTM used in association with synthetic resins for use in the manufacture of moulding compounds.

Further trademarks have been applied for and have been awarded for the various resin based products such as NVSä, Rstandardä, Rsealä.  As we develop further products, additional trademarks will be filed as we determine necessary to protect our interests.



D.

Trend Information

We have designed and are offering VersionTM as a resin replacement" product.  Although our internal cost structure, in particular unit costs, permits direct competition against the vast majority of current commodity resins, our initial strategy will be to focus on premium pricing opportunities based on Version® resin's unique features and potential for new product applications.

We anticipate operating margins in the 25% to 35% range during the product introduction stage.  The potential for improvement with in-house or strategic alliance manufacturing will move these margins towards the 50% range dependent upon the specific market approached.  Pricing and margins for the various VersionTM variations produced for specific purposes will command higher pricing and hence higher operating margins.

Management believes based upon independent research related to utility poles, market size, general trends relating to the environment and engineering advice related to costs, that our utility pole product shows an acceptable margin and will move us towards profitability.

We are not aware of any trends related to purchasing, sales, inventory or otherwise, or any uncertainties, demands, commitments or events which are reasonably likely to have a material effect upon the net sales or revenues, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating financial condition.

E.

Off-balance Sheet Arrangements

We do not have any off-balance sheet arrangements other than our joint venture with Euro Projects (LTTC) Limited, (EPL) of Rothely, England.  Under this joint venture we will be obtaining, with any third party consents, EPLs exclusive world wide right for commercialization of existing and all future technologies as developed or being developed by EPL.  Under the terms of the joint venture we will be contributing the working capital, manufacturing and production facilities and all related consulting and development services at cost.  Upon repayment of all working capital contributions by us, the first U.S. $2,000,000 in net profits will be distributed equally and any addition profits will be distributed 85% and 15% between us and EPL respectively.

As at December 31, 2003 the joint venture had not done any business and as such we had not incurred any costs.

F.

Tabular Disclosure of Contractual Obligations

We have operating leases related to offices and plant facilities as described in note 10 of the financial statements.  At present the only determinable future payments are those leases set forth below.  Note 10 also indicates royalties related to the sale of Uni-SealTM product and the sale of utility poles. These payments are purely based upon sales and are not determinable at this time.

|Caption          | Total     | 1 yr
and
less | 2-3
years | 4-5
years | More
than
5 yrs.
|---------------- | --------- | ------------- | --------- | --------- | ----------------
|Operating leases | 1,264,793 | 311,002       | 422,711   | 246,108,  | 284,972         



ITEM 6.

DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.

Directors and Senior Management

The following table sets forth the names of our directors and executive officers.

|Name and Office held in Resin                                                         | Age | Principal business activities performed Outside the Company during the past Five Years                                                                                                                                                                                 
|------------------------------------------------------------------------------------- | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Dr. Brian Carpenter
Chairman and Director                                             | 58  | One of our original founders and Chairman since 1995.  President of BYO Balance Ltd. a holistic health care facility, since 1990.                                                                                                                                      
|Greg Pendura
President, Chief Executive Officer and Director                          | 56  | One of our original founders and President and Chief Executive Officer since July 3, 2001.  Executive Vice President and Director from July 1995 until July 3, 2001.                                                                                                   
|David Slaback
Vice-President, Operations and Director                                 | 42  | Director, Customer Relations and Technical System from March 1999.  From September 1998 until March 1999 Vice-President of Uni-Seal USA, Ltd.  Prior thereto, Vice-President of Uni-Seal Coatings Company, an industrial coatings company, from 1992 to September 1998.
|Dwayne Hunka
Director                                                                 | 46  | Director since September 17, 1998. President of Waiward Steel Ltd., a steel fabrication company, since 1978.                                                                                                                                                           
|Zsolt Feketekuty                                                                      | 58  | Director since February 2004, Mr. Feketekuty is a chartered accountant with a public practice in Edmonton since 1989.                                                                                                                                                  
|Paul Giannelia
Chief Executive Officer of RS Technologies (a division of Resin)       | 56  | Chief Executive Officer of RS Technologies, a division of Resin, since September 2003.  President of SCI Group of Companies since 1977 to present.                                                                                                                     
|Michael Giannelia
Vice-President, Commercial of RS Technologies (a division of Resin) | 41  | Vice-President, Commercial of RS Technologies, a division of Resin, since December 2003, Manager of Project Administration for Aecon Group Inc. from May 1998 to November 2003.                                                                                        
|Mark Warren
Vice-President, Technical of RS Technologies (a division of Resin)        | 32  | Vice-President, Technical of RS Technologies, a division of Resin, since June 2003.  Project Manager of Aecon Group Inc., a construction and infrastructure development company, from June 1998 to June 2003.                                                          
|Keith Gerrard
Controller                                                              | 48  | Controller since April 2000.   Prior thereto, Controller of Cage Transport Ltd., an oilfield transport company, since February 1997.                                                                                                                                   

There are no arrangements or understandings between us and any director or executive officer and any other person pursuant to which such director or executive officer was selected and, with the exception of Paul and Michael Giannelia who are brothers, there is no family relationship between any such director or executive officer and any other such director or executive officer.

B.

Compensation

Directors

We do not pay fees to directors, but from time to time have granted stock options to directors.  In addition, directors are reimbursed for their out-of-pocket expenses incurred in carrying out their duties as directors.

Named Executive Officers

Canadian securities legislation requires the disclosure of all compensation earned by the Named Executive Officers for our three most recently completed financial years.  For these purposes "Named Executive Officers" means the following individuals:



-

each individual who served as Chief Executive Officer or acted in a similar capacity during our most recently completed financial year;



-

each individual who served as Chief Financial Officer or acted in a similar capacity during our most recently completed financial year;



-

each of our three most highly compensated executive officers, other than the Chief Executive Officer and Chief Financial Officer, who were serving as executive officers at the end of our most recently completed financial year and whose salary and bonus exceeds $150,000; and



-

any additional individuals for whom disclosure would have been provided under the immediately preceding point except that the individual was not serving as an officer of our company at the end of the most recently completed financial year-end.



The following table sets forth all compensation paid to the our Chief Executive Officer and person acting in a similar capacity Chief Financial Officer during the four months ended December 31, 2003 and the two fiscal years ended August 31, 2003 and 2002.  No other executive officer of our company received a salary and bonus exceeding, in the aggregate, $150,000 during the four months ended December 31, 2003.



|Name and Principal
Position | Fiscal
Year | Annual Compensation           | Securities Under Stock Options Granted
(#) | All
Other Compensation
($)
|--------------------------- | ----------- | ----------------------------- | ------------------------------------------ | --------------------------
|Salary
($)                  | Bonus
($)   | Other Annual
Compensation
($)
|Greg Pendura (1)            | Dec 2003(3) | 35,332                        | Nil                                        | Nil                       
|2003                        | 105,996     | Nil                           | Nil                                        | Nil                       
|                            | 2002        | 96,360                        | Nil                                        | Nil                       
|Keith Gerrard(2)            | Dec 2003(3) | 23,833                        | Nil                                        | Nil                       
|                            | 2003        | 71,500                        | Nil                                        | Nil                       
|                            | 2002        | 67,500                        | Nil                                        | Nil                       
|                            |             |                               |                                            |                           

Notes:

1.

Mr. Pendura was appointed our President and Chief Executive Officer July 3, 2001.

2.

Mr. Gerrard is our Controller and performs functions of Chief Financial Officer as required.

3.

Four month period ended December 31, 2003

During the four month period ended December 31, 2003 and the fiscal year ended August 31, 2003, the following directors exercised options on our common shares.   Stock options granted to directors for the periods are as follows:

Options Granted                     Options Exercised

Expiration   Exercise   Date of            Exercise

Number    Date   Price   Grant   Number  Price

Len Danard      Nil

N/A             N/A

N/A

100,000   $0.34

David Slaback   100,000  Dec. 23/08  0.80     Dec 24/03     150,000   $0.34

Brian Carpenter 200,000  Dec 23/08   0.80     Dec 24/03      Nil        Nil

Dwayne Hunka    100,000  Dec 23/08   0.80     Dec 24/03      Nil        Nil

Greg Pendura    100,000  Dec 23/08   0.80     Dec 24/03      Nil        Nil

Other than the share option plan described under "Options to Purchase Securities from Registrant or Subsidiaries", we do not have any plans, which provide compensation as an incentive for performance over a period longer than one fiscal year.  We have no retirement plan, pension plan or other form of retirement compensation for our employees.

C.

Board Practices

Directors are elected annually at our annual meeting of shareholders and hold office until the earlier of their resignation or removal from office at a subsequent annual meeting of shareholders.  Our articles stipulate that the board of directors shall consist of a minimum of one and a maximum of 15 directors.  Vacancies created by departing directors may be filled by the Board of Directors between annual shareholders meetings.

There are no service contracts between us and any of our directors.

Audit Committee

Our Audit Committee currently consists of Brian Carpenter, Dwayne Hunka, and Zsolt Feketekuty, selects and engages, on behalf of Resin, the independent public accountants to audit Resins annual financial statements, and reviews and approves the planned scope of the annual audit.  The Audit Committee has direct communication channels with the auditors to discuss and review specific issues as appropriate.  The Audit Committees duties include the responsibility for reviewing financial statements with management and the auditors, monitoring the integrity of Resins management information systems and internal control procedures and reviewing the adequacy of Resins processes for financial reporting.  The Audit Committee reports its findings with respect to such matters to our Board of Directors.



D.

Employees

The following table sets forth the number of our employees and our operating subsidiaries at the end of the last three fiscal years, including their main category of employment and geographic location.  These numbers exclude executive officers who are employees, but include consultants on long term contracts.  None of these employees are presently covered by any collective bargaining or union relationship.

|               | DEC. 2003 | 2003 | 2002     | 2001  
|-------------- | --------- | ---- | -------- | ------
|               | Canada    | U.S. | Barbados | Canada
|Operations     | 24        |      |          | 24    
|Accounting     | 2         |      |          | 2     
|Administration | 12        | 1    | 1        | 9     
|Total          | 38        | 1    | 1        | 35    



E.

Share Ownership by Directors and Executive Officers

The following table sets forth the number of common shares and options held by each person listed in subsection 6.B as at May 31, 2004.

|Name                 | Approximate Number Of Common Shares Held Directly Or Indirectly(4) | Percentage Of Total Common Shares Issued
And Outstanding As At May 31, 2004 | Options Granted                     | Option Exercise
Price   | Option Expiry Date                                
|-------------------- | ------------------------------------------------------------------ | --------------------------------------------------------------------------- | ----------------------------------- | ----------------------- | --------------------------------------------------
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Dr.  Brian Carpenter | 3,395,732(1)                                                       | 5.3%                                                                        | 100,000
100,000
200,000
200,000     | $0.34
$0.40
$0.40
$0.80 | Nov 19, 2006
May 3, 2007
May 21, 2007
Dec 23, 2008
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Greg Pendura         | Nil(2)                                                             | Nil                                                                         | 66,667                              | $0.80                   | Dec 23, 2008                                      
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|David Slaback        | 558,872(3)                                                         | 0.91%                                                                       | 40,000
100,000
300,000
100,000      | $0.40
$0.40
$0.40
$0.80 | Apr 1, 2005
May 3, 2007
May 21, 2007
Dec 23, 2008 
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Dwayne Hunka         | 101,922                                                            | 0.16%                                                                       | 100,000
100,000
100,000             | $0.34
$0.40
$0.80       | Nov 19, 2006
May 3, 2007
Dec 23, 2008             
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Paul Giannelia       | 125,000                                                            | 0.20%                                                                       | 150,000
100,000
1,000,000
1,223,000 | $0.55
$0.57
$1.18
$1.14 | Dec 1, 2007
Dec 17, 2007
Jan 5, 2008
Sept 22, 2008
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Michael Giannelia    | 13,333                                                             | 0.02%                                                                       | Nil                                 | N/A                     | N/A                                               
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Mark Warren          | 13,333                                                             | 0.02%                                                                       | Nil                                 | N/A                     | N/A                                               
|                     |                                                                    |                                                                             |                                     |                         |                                                   
|Keith Gerrard        | 5,550                                                              | 0.01%                                                                       | 40,000
40,000
37,500                | $0.34
$0.65
$0.40       | Aug 20, 2005
July 10, 2006
May 21, 2007           

Notes:

1.

3,195,732 of these common shares are held by JMC Investments Ltd., a company whose voting securities are owned as to 100% by Dr.  Carpenter's spouse, Jeanne M.  Carpenter.

2.

3,656,840 of our common shares are owned by a trust established pursuant to the laws of Barbados, the beneficiaries of which are Mr. Pendura's wife and his children.

3.

Mr. Slaback owns 12% of the issued and outstanding share of USCC Holding Company, which owns 4,275,596 Common Shares.

4.

The information as to the number of common shares beneficially owned, directly or indirectly, or over which control or direction is exercised, is based upon information furnished to us by the respective individuals.

Options to Purchase Securities from Registrant or Subsidiaries

Share Option Plan

At the Annual and Special Meeting of shareholders held on December 4, 2003 our shareholders approved a share option plan which provides that our Board of Directors may from time to time, in their discretion, grant to our directors, officers, employees and consultants, or any subsidiary of ours, options to purchase common shares, provided that the number of common shares reserved for issuance under the share option plan shall not exceed 9,500,000 common shares.  In addition, the number of common shares reserved for issuance upon exercise of options granted to any one person shall not exceed five percent (5%) of the issued and outstanding common shares.

The Board of Directors determines the price per common share and the number of common shares, which may be allotted to each director, officer, employee and consultant and all other terms and conditions of the option, subject to the rules of TSX Venture Exchange.  The price per common share set by the Board of Directors shall not be less than the last price at which a full board lot of common shares was, on the last business day prior to the date on which such option is granted, traded on TSX Venture Exchange or such other principal market on which the common shares are then traded, less the applicable discount permitted (if any) by such applicable exchange or market.  Options under the stock option plan are non-assignable.

If prior to the exercise of an option, the holder ceases to be a director, officer, employee or consultant of our company, or our subsidiary, the option of the holder shall be limited to the number of shares purchasable by him immediately prior to the time of his cessation of office or employment and he will have no right to purchase any other shares.  Options must be exercised within 30 days of termination of employment or cessation of position with our company, provided that if the cessation of office, directorship, consulting arrangement or employment was by reason of death, the option must be exercised within 12 months after such death, subject to the expiry date of such option.

Under Canadian GAAP for years ended August 31, 2002 and 2001, there is no requirement to record compensation expense on the issue of stock options or stock to employees, directors or consultants.  Under U.S. GAAP for stock and stock options issued to employees the Company has adopted the intrinsic value-based method of accounting prescribed by Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to Employees and related interpretations.  As such, compensation expense is recorded on the date of grant only if the current market price of the underlying stock exceeds the price the employee or director is required to pay.  Under U.S. GAAP, stock options issued to consultants and other third parties are accounted for at their fair values in accordance with SFAS No. 123.

The outstanding share options granted to officers, directors, employees and consultants of our company as of May 31, 2004 are set forth below.

|                                                                                      | Number Of Common Shares Under Option                                                             | Exercise
Price                                                                | Expiry Date                                                                                                                                                    
|------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------
|Dr.  Brian Carpenter
Chairman and Director                                            | 100,000
100,000
200,000
200,000                                                                  | $0.34
$0.40
$0.40
$0.80                                                       | Nov 19, 2006
May 3, 2007
May 21, 2007
Dec 23, 2008                                                                                                             
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Greg Pendura
President, Chief Executive Officer and Director                          | 66,667                                                                                           | $
$0.80                                                                       | Dec 23, 2008                                                                                                                                                   
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|David Slaback
Director                                                                | 40,000
100,000
300,000
100,000                                                                   | $0.40
$0.40
$0.40
$0.80                                                       | Apr 1, 2005
May 3, 2007
May 21, 2007
Dec 23, 2008                                                                                                              
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Dwayne Hunka
Director                                                                 | 100,000
100,000
100,000                                                                          | $0.34
$0.40
$0.80                                                             | Nov 19, 2006
May 3, 2007
Dec 23, 2008                                                                                                                          
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Paul Giannelia
Chief Executive Officer of RS Technologies (a division of Resin)       | 150,000
100,000
1,000,000
1,223,000                                                              | $0.55
$0.57
$1.18
$1.14                                                       | Dec 1, 2007
Dec 17, 2007
Jan 5, 2008
Sept 22, 2008                                                                                                             
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Michael Giannelia
Vice-President, Commercial of RS Technologies (a division of Resin) | Nil                                                                                              | N/A                                                                           | N/A                                                                                                                                                            
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Mark Warren
Vice President, Technical of RS Technologies (a division of Resin)        | Nil                                                                                              | N/A                                                                           | N/A                                                                                                                                                            
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Keith Gerrard
Controller                                                              | 40,000
40,000
37,500                                                                             | $0.34
$0.65
$0.40                                                             | Aug 20, 2005
July 10, 2006
May 21, 2007                                                                                                                        
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Employees and Consultants                                                             | 30,000
115,000
40,000
75,000
300,000
500,000
50,000
25,000
200,000
200,000
100,000
50,000
50,000 | $0.34
$0.34
$0.50
$0.40
$0.56
$0.57
$1.00
$0.90
$0.80
$1.00
$3.00
$0.85
$1.33 | Aug 30, 2005
Nov 19, 2006
Feb 1, 2007
May 21, 2007
Nov 21, 2007
Dec 17, 2007
Mar 27,2006
Nov 5,2008
Dec 11,2008
Feb  4,2006
Feb  4,2003
Apr  6,2005
Apr 30,2005
|Total Officers and Directors (8)
Total Employees and Consultants (30)                 | 4,097,167

1,735,000                                                                             |                                                                               |                                                                                                                                                                
|                                                                                      |                                                                                                  |                                                                               |                                                                                                                                                                
|Total Share Options Outstanding                                                       | 5,832,167                                                                                        |                                                                               |                                                                                                                                                                



ITEM 7.

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.

Major Shareholders

Our authorized capital consists of an unlimited number of common shares, without nominal or par value, and an unlimited number of preferred shares, issuable in series.  As of May 31, 2004 we had a total of 64,071,332 common shares issued and outstanding.  There are no preferred shares issued and outstanding.

To the knowledge of our directors and senior officers, there are no persons or entities who beneficially hold, directly or indirectly or exercise control or direction over, more than 5% of the voting rights attached to our issued and outstanding common shares as at May 31, 2004 except as set forth below:

|Name                     | Designation Of Class | Number Of Common Shares Owned | Percentage of Issued and Outstanding Common Shares as at May 31, 2004
|------------------------ | -------------------- | ----------------------------- | ---------------------------------------------------------------------
|USCC Holding Company(1)  | Common Shares        | 4,275,596                     | 6.7%                                                                 
|Dr.  Brian Carpenter     | Common Shares        | 3,395,732(2)                  | 5.3%                                                                 
|The Island Reef Trust(3) | Common Shares        | 3,656,840                     | 5.7%                                                                 

Notes:

1.

To our knowledge, the individuals who have ownership of, or control or direct, more than 10% of the securities of USCC Holding Company are David Slaback, Lois Slaback and Dirk Slaback.

2.

3,195,732 of these common shares are held by JMC Investments Ltd., a company whose voting securities are owned as to 100% by Dr.  Carpenter's spouse, Jeanne M.  Carpenter.

3.

The Island Reef Trust is a trust established pursuant to the laws of Barbados, the beneficiaries of which are Greg Pendura's wife and children.

Except for Greg Pendura's disposition of all the common shares of our company owned by him to The Island Reef Trust effective May 22, 2003, there have been no significant changes in the percentage ownership held by any major shareholders during the past three years.

Escrowed Securities

As at April 15, 2004 there were 8,729,604 of our common shares held in escrow pursuant to the terms of a TSX Venture Exchange escrow agreement dated October 15, 2002 among us, Computershare Trust Company of Canada, Brian Carpenter, Greg Pendura and USCC Holding Company.  The escrowed common shares will be released from escrow as follows: 484,978 of the common shares will be released on October 15, 2004; and 969,956 of the common shares will be released on each of April 15 and October 15, 2005, 2006, 2007 and 2008.

Voting Rights and Control by Shareholders

Our major shareholders do not have different voting rights from other shareholders.

As of May 31, 2004, 11,059,865 common shares, representing 17.26% percent of our 64,071,332 outstanding common shares were owned by 61 holders having an address of record within the United States.

To the knowledge of our officers and directors, we are not directly or indirectly owned or controlled by another corporation or corporations, by any other natural or legal person or persons, severally or jointly.

There are no arrangements known to us, which may, at a subsequent date, result in a change in control.

B.

Related Party Transactions

We are not aware of any material transaction in the last three fiscal years involving any director, executive officer or any shareholder holding more than 10% of the voting rights attached to the common shares or any associate or affiliate of any of the foregoing, other than as set forth herein and in the table below.  All of the following related party transactions were outstanding prior to the enactment in July 2002 of the Sarbanes-Oxley Act of 2002.

|Name and Principal Position                                     | Involvement of Resin | Largest Amount Outstanding During the Three Fiscal Years Ended August 31, 2003 and Four Months Ended December 31, 2003 | Amount Outstanding as at
May 31, 2004 | Security for Indebtedness
|--------------------------------------------------------------- | -------------------- | ---------------------------------------------------------------------------------------------------------------------- | ------------------------------------- | -------------------------
|Dr.  Brian Carpenter
Chairman of the Board and Director         | Lender               | $40,000(1)                                                                                                             | $40,000                               | 200,000 common shares    
|Greg Pendura
President and Chief Executive Officer and Director | Lender               | $65,000(1)                                                                                                             | Nil                                   | 325,000 common shares    
|David Slaback
Vice President, Operations and Director           | Lender               | $86,000(2)                                                                                                             | Nil                                   | 150,000 common shares    
|Dwayne Hunka
Director                                           | Lender               | $15,000 (1)                                                                                                            | Nil                                   | 75,000 common shares     

Notes:

1.

On May 24, 2000 we loaned the directors and officers set forth in the table above an aggregate of $150,000 in order to enable them to exercise stock options to acquire an aggregate of 750,000 common shares of our company.  The loans were evidenced by interest free promissory notes with no fixed terms of repayment and were secured by the pledge of 750,000 common shares of our company acquired on exercise of the options.

2.

The $86,000 is comprised of a $30,000 loan made by us to Mr. Slaback on May 24, 2000 as described in note (1) above and a $56,000 interest free relocation loan made by us to Mr. Slaback in 1999 which loan was repaid in full during the 2001 fiscal year.

C.

Interests of Experts and Counsel

Not applicable.

ITEM 8.

FINANCIAL INFORMATION

A.

Consolidated Statements and Other Financial Information

Incorporated herein are the consolidated financial statements for the four months ended December 31, 2003 and the fiscal years ended August 31, 2003 and 2002.  As at the date of filing we were not involved in any lawsuits.

We have never paid dividends.  We intend to retain our earnings for use in the business and do not expect to pay dividends on our common shares in the foreseeable future.

B.

Significant Changes

No significant changes.

ITEM 9.

THE OFFERING AND THE LISTING

A.

Offer and Listing Details

Price History

Our predecessor public company, Summerwood Industries Inc. began trading as a capital pool company, on The Alberta Stock Exchange in March 1997.  On September 15, 1998, Recycled Solutions for Industry Inc. completed a reverse acquisition and acquired 100% of Summerwood Industries Inc. Recycled Solutions continued to trade on The Alberta Stock Exchange under the symbol "RS".  On May 8, 2000, the company changed its name to Resin Systems Inc., but retained the "RS" symbol.  The high and low market prices for the common shares on the TSX Venture Exchange, formerly the Canadian Venture Exchange Inc. (formed by the merger of The Alberta Stock Exchange and the Vancouver Stock Exchange), and the Alberta Stock Exchange for the relevant periods are listed below.

|Trading for the Months Ended        | High (Cdn. $) | Low (Cdn. $)
|----------------------------------- | ------------- | ------------
|May 2004                            | 1.37          | 1.15        
|April 2004                          | 1.38          | 1.07        
|March 2004                          | 1.17          | 1.00        
|February 2004                       | 1.13          | 0.80        
|January 2004                        | 0.93          | 0.76        
|December 2003                       | 0.90          | 0.74        
|November 2003                       | 1.00          | 0.80        
|October 2003                        | 1.10          | 0.89        
|September 2003                      | 1.25          | 0.90        
|August 2003                         | 1.00          | 0.89        
|Trading for the Quarters Ended      | High (Cdn. $) | Low (Cdn. $)
|Four months ended
December 31, 2003 | 1.24          | 0.77        
|August 31, 2003                     | 1.01          | 0.75        
|May 31, 2003                        | 1.15          | 0.71        
|February 28, 2003                   | 1.56          | 0.48        
|November 30, 2002                   | 0.65          | 0.40        
|August 31, 2002                     | 0.65          | 0.31        
|May 31, 2002                        | 0.53          | 0.30        
|February 28,2002                    | 0.60          | 0.29        
|November 30,2001                    | 0.50          | 0.20        
|                                    |               |             
|Trading for Fiscal Periods Ended    | High (Cdn. $) | Low (Cdn. $)
|Four months December 31, 2003       | 1.24          | 0.77        
|Year August 31, 2003                | 1.56          | 0.40        
|Year August 31, 2002                | 0.65          | 0.20        
|Year August 31, 2001                | 1.70          | 0.35        
|Year August 31, 2000                | 0.85          | 0.16        
|Year August 31, 1999                | 2.10          | 0.21        



Transfer and Transferability

The transfer of our common shares is managed by our transfer agent, Computershare Trust Company of Canada, Suite 600, 530  8th Avenue S.W., Calgary, Alberta, Canada, T2P 3S8.

B.

Plan of Distribution

Not applicable.

C.

Markets

Our common shares trade in Canada on the TSX Venture Exchange under the trading symbol "RS".  Non-Canadian investors are also able to trade our common shares over the facilities of this exchange.  In addition, on August 5, 2003 our common shares began being quoted in the United States on the Over The Counter Bulletin Board Market under the trading symbol "RSSYF".

D.

Selling Shareholders

Not applicable.

E.

Dilution

Not applicable.

F.

Expenses of the Issue

Not applicable.

ITEM 10.

ADDITIONAL INFORMATION

A.

Share Capital

Not applicable.

B.

Memorandum and Articles of Association

Please refer to Resin Systems Inc. Form 20-F registration statement filed on December 19, 2000.

Material Contracts

On July 31, 1996, we entered into a License Agreement with Uni-Seal Coatings Company, which gave us the right to market the coatings product (Uni-Seal) throughout the world, except for those provinces of Canada lying east of Manitoba.

On May 24, 2000, we received promissory notes in return for the issuance of common shares pursuant to the exercise of 750,000 options by directors and officers of the company at an exercise price of $0.20 per share.  These notes totaling $150,000 are interest free and have no fixed term of repayment.  As collateral for the notes we are holding the 750,000 shares.  As at August 31, 2003 certain directors and officers have paid a total of $52,000 reducing the notes to which 260,000 shares have been released.

In February 2002, we signed a lease for premises at 14604  115 A Avenue, Edmonton to house our office and plant for a period of five years.  The lease has a renewable option for another five years and provide us with the space required for our operations and its anticipated growth.

We entered into a collaborative research and development agreement dated effective April 1, 2002 with the Alberta Research Council Inc. whereby the Alberta Research Council's test center capabilities would be utilized to present evaluative and comparative product data for the Version® family of resins.  Pursuant to the agreement, the Alberta Research Council will provide $500,000 of research and development services to us over the term of the agreement in exchange for common shares.  To date the Alberta Research Council has provided $250,000 of research and development services to us in consideration for 441,847 common shares.

Also in April 2002, we entered into an agreement with the National Research Council of Canada to further develop our family of Version® resins.  The support from the National Research Council is intended to expedite the further development of our Version® resin system for the large pultrusion and filament winding composite markets.  We expect to use the proceeds of a $400,000 repayable contribution from the National Research Council's Industrial Research Assistance Program to focus on pre-commercialization and development funding for Version® "F" and "S", two products being designed for flame retardancy and processing speed applications.  Pursuant to the agreement, we are required to repay 1.9% of our gross revenues derived from Version® resin systems developed through the use of the National Research Council funds commencing June 1, 2005 through to March 1, 2010 to a maximum of the $400,000 contribution made by the National Research Council.  However, if by March 1, 2010 we have not repaid an amount equal to the $400,000 contribution, we must make payments equal to 1.9% of our gross revenues (whether or not they were derived from the Version® resin systems developed through the use of the National Research Council funds), until either the $400,000 contribution is repaid or June 1, 2015.

On May 1, 2002, we entered into a supply agreement with Dow Chemical Canada, Inc. pursuant to which Dow agreed to supply us with base chemicals used by us to manufacture our Version® resins.  The agreement expired on December 31, 2003, but we have received verbal continuance of the supply agreement and are awaiting written confirmation.

In July 2002, we provided Douglas Grindstaff a loan in the amount of $193,540 CAD, payable on demand and used to acquire in the above private placement 483,850 units of our securities.  The loan is evidenced by an interest free promissory note and is being repaid through the provision of consulting services at approximately $12,000 per month.  If the consulting agreement is terminated, any amount is due within sixty days.  As collateral for the note, we are holding the 483,850 units.  As at December 31, 2003 the balance has been fully repaid.

Effective October 15, 2002, we entered into a TSX Venture Exchange escrow agreement among Computershare Trust Company of Canada, Brian Carpenter, Greg Pendura and USCC Holding Company.  Originally, 9,699,560 common shares were held in escrow by Computershare Trust Company of Canada, as escrow agent pursuant to the terms of the agreement.  As at May 31, 2004 there were 8,729,604 of our common shares held in escrow which shares will be released from escrow as follows:  484,978 of the common shares will be released on October 15, 2004; and 969,956 of the common shares will be released on each of April 15 and October 15, 2005, 2006, 2007 and 2008.

On January 6, 2003, we entered into an asset purchase agreement with Canzeal Enterprises Ltd. and Bruce Elliott pursuant to which we completed the arm's length acquisition of the worldwide right, title and interest in and to all intellectual property assets of Canzeal related to the design, manufacture and distribution of composite poles in consideration of the following:

a.

we issued Canzeal 3,000,000 units at an aggregate deemed price of $1,500,001, each unit comprised of one (1) common share and one-half of one warrant of our company, each whole warrant entitling the holder thereof to purchase one (1) common share of our company at an exercise price of $0.75 per share at any time on or before January 6, 2004;

b.

we will pay Canzeal a royalty (payable quarterly) until January 6, 2007 equal to the sum of:  (i) 3.5% of the net revenues received by us from the sale of composite poles manufactured by us using the assets, and (ii) one-half of any royalties received by us from a third party licensee (up to a maximum of 3.5% of the net revenues generated by a third party licensee) pursuant to a license granted to use the assets to manufacture and sell composite poles; and

c.

we granted Canzeal a right of first refusal to build line equipment for our third party licensees to manufacture composite poles based on the assets as well as 50% of the profits generated by us from the sale of line equipment built by Canzeal to third party licensees, provided that Canzeal shall not charge us in excess of 5% more than a bona fide quote we have received from a third party to build such equipment.

In January 2003, we sold the non-North American rights to our Version Technology and our Filament Winding Technology, at fair market value, to our subsidiary Resin Systems International Ltd. (RSIntl).  This allows RSIntl to engage in transactions world-wide with the exception of North America and establish its own client and trading base.  We also entered into a cost sharing agreement with RSIntl for the development of new technologies, products and improvements.

On January 9, 2003, we entered into a distribution and option for manufacturing agreement with Harwell Hesco Electric Supply Co.  Limited, an Ontario corporation, appointing Harwell Hesco as the eastern Canadian distributor of our composite poles and granting Harwell Hesco an option to become our exclusive agent entitled to manufacture and supply our composite poles in eastern Canada.  The initial term of the agreement is for two years, which is extendible by mutual agreement between the parties.

Additionally in January 2003, we signed two offers to lease for additional production facilities at 14650  112 Avenue, Edmonton, Alberta.  These premises are earmarked for the exclusive production of utility poles.

In March 2003, we entered into an agreement with Euro-Projects (LTTC) Ltd. (EPL) for support in developing composite utility pole standards, specifications and data enabling us to move forward with pole production.  Included in this agreement EPL is completing design and construction parameters, developing computer software for the design process, along with training and support services for production.

On June 1, 2003, we entered into an employment contract with Mr. Mark Warren who has become our Vice-President of Technical.  Under his contract Mr. Warren will receive a salary of Cdn. $9,000 per month with a bonus structure based upon the production rates of utility poles.

On August 1, 2003, we signed consulting agreements with Mr. Philip Lockwood an engineer who is providing solutions for modular design for composite utility poles, design and installation work methods, next generation filament winding equipment and work methods.  Under the agreement with Mr. Lockwood he is paid Cdn. $10,000 per month plus an additional consulting fee of on completion of his assignment.  Additionally we signed an agreement with Mr. Paul Diemert for the development of and implementation of sales and marketing strategies, plans, procedures and structure.  Additionally, Mr. Diemert is working on these tasks for our composite utility poles and accessories, our hockey shaft and all terrain boards, Twin-Tex products and our Version resin system.  Mr. Diemerts agreement calls for payment of Cdn.$8,000 per month plus additional consulting fees upon reaching sales of Cdn. $2,000,000. On August 30, 2003, we entered into a Joint venture with our wholly owned Barbadian subsidiary Resin Systems International Ltd. and Euro Projects (LTTC) Ltd. pursuant to a joint venture agreement of the same date governing its and Resin International's exclusive world-wide right to commercialize existing and future technologies owned and developed by Euro-Projects on behalf of the joint venture in exchange for working capital contributions by our company and the use of our manufacturing facilities.  At the same time and as part of the joint venture agreement, the parties entered into a technology license agreement governing the use of Euro-Project's technology, an agreement for Euro-Project to provide design, support and consulting services to us, and an operating agreement, which also included RS Technologies Inc., under which our company conducts the day to day operations of the joint venture.

On September 26, 2003, we entered into a lease for office space at #400, 2421  37 Avenue NE, Calgary, Alberta with The Great West Life Assurance Company.  This office space has an initial term running to March 31, 2011, with two five-year renewal options.  It will house our operating division RS Technologies who are responsible for day to day operations and development of future products and markets initially within North America.

On November 7, 2003, we entered into a services agreement with Thorpe Beeston Investments Ltd. (TBI) of London, England.  Under the terms of the agreement TBI will help us develop market awareness strategies for Europe and North America, assist in corporate positioning and messaging, create and distribute corporate materials, introduce us to third-party analysts, distribute shareholder awareness reports and introduce us to financial institutions/broker dealers for the purpose of attracting investment capital or research coverage.  TBI has a total budget of U.S. $540,000 which includes TBIs time, materials and all other expenses with the exception of travel and business expenses.  The term of the agreement covers November 7, 2003 through July 7, 2004 inclusive.

On November 19, 2003, we entered into a distribution and representation agreement with R.R. Interior Power & Electric Ltd. (RRI) of Williams Lake, British Columbia.  The term of the agreement runs through to December 31, 2006 with a one year automatic renewal term.  RRI has the exclusive rights to distribute our composite utility poles and other utility products we produce in British Columbia, Yukon and Northwest Territories.  RRI under the agreement is required to meet certain sales quotas during the course of the agreement.

In January 2004, we entered into another distribution and representation agreement with R.R. EECOL Electric Inc. (EECOL) of Calgary, Alberta.  The term of the agreement runs through to June 30, 2007 with a one year automatic renewal term.  EECOL has the exclusive rights to distribute our composite utility poles and other utility products we produce in Alberta, Saskatchewan and Manitoba.  EECOL under the agreement is required to meet certain sales quotas during the course of the agreement.

In March 2004, our division RS Technologies received the initial order form EECOL, its prairie distributor, of in excess of $3 million of composite utility poles and cross-arms.  Delivery of the products will take place over the next twelve months starting at the end of the second quarter.

Furthermore in March 2004, our division RS Technologies entered into an agreement with Harwell Hesco Electric Supply Company Ltd. for the long-term comprehensive definitive distribution of power, lighting and communications utility products.  The initial region covered under this agreement is the province of Ontario.  The agreement further contains sales performance criteria and growth objectives.  In addition to this agreement RS Technologies received an initial order in excess of $6 million of composite utility poles and cross-arms.  Delivery of this order will not be complete until 2005 but the first deliveries are scheduled to start at the end of the second quarter of 2004.

In May 2004, we engaged Kingsdale Capital Markets Inc. and Kingsdale Capital Partners Inc. of Toronto, Ontario to act as agent to sell, by way of private placement, up to 8,695,652 units of the Company at $1.15 per unit for total gross proceeds of $10,000,000.  The units consist of one Common Share and one half Common Share warrant, exercisable for a twelve month period from the closing date at an exercise price of $1.50 per share.  Kingsdale will receive a 7.0% commission on the gross proceeds and will receive Agent broker warrants in the amount of 7% of the number of units it has sold.  Each broker warrant will entitle the holder to acquire one Common Share at an exercise price of $1.15 for a period of eighteen months from the closing date of the private placement.

C.

Exchange Controls

Except as discussed in "taxation" below, we are not aware of any Canadian federal or provincial laws, decrees, or regulations that restrict the export or import of capital, including foreign exchange controls, or that affect the remittance of dividends, interest or other payments to non-Canadian holders of common shares.  Except as discussed below, we are not aware of any limitations on the right of non-Canadian owners to hold or vote common shares imposed by Canadian federal or provincial law or by us.

The Investment Canada Act (the "Act") governs the acquisition of control of a Canadian business by a non-Canadian person.  The Act provides, among other things, for a review of an investment in the event of an acquisition of control of a Canadian business in the following circumstances:

1.

if the investor is a non-Canadian and is not a World Trade Organization ("WTO") investor (as defined in the Act), any direct acquisition having an asset value exceeding $5,000,000 and any indirect acquisition having an asset value exceeding $50,000,000; and

2.

if the investor is a non-Canadian and is a WTO investor, any direct acquisition having an asset value exceeding for 2004 $223,000,000 unless the business is involved in uranium production, financial services, transportation services or a cultural business in which case the lower threshold and different rules apply.

An indirect acquisition of control by a WTO investor is generally not reviewable unless the value of the assets of the business located in Canada represents more than 50% of the asset value of the transaction, or the business is involved in uranium production, financial services, transportation services or a cultural business.

The Act provides that a non-Canadian investor can hold up to 1/3 of the issued and outstanding voting shares of a Canadian corporation without being deemed to have acquired control, and that a non-Canadian investor holding greater than 1/3 but less than 1/2 of the issued and outstanding voting shares of a Canadian corporation is deemed to have acquired control subject to a rebuttable, presumption to the contrary (i.e.  providing evidence of another control person or control group holding greater number of voting shares).

The Act requires notification where a non-Canadian acquires control, directly or indirectly, of a Canadian business with assets under the thresholds for a reviewable transaction.  The notification process consists of filing a notification within 30 days following the implementation of an investment.

D.

Taxation

The following is a summary of the material Canadian federal income tax considerations generally applicable in respect of our common shares.  The tax consequences to any particular holder of common shares will vary according to the status of that holder as an individual, trust, corporation or member of a partnership, the jurisdiction in which that holder is subject to taxation, the place where that holder is resident and, generally, according to that holder's particular circumstances.

This summary is based upon the current provisions of the Income Tax Act (Canada) (Tax Act), the regulations thereunder, the current publicly announced administrative and assessing policies of Canada Customs and Revenue Agency and all specific proposals to amend the Tax Act and regulations announced by the Minister of Finance (Canada) prior to the date hereof.  The description is not exhaustive of all possible Canadian federal income tax consequences and, except for the specific proposals, does not take into account or anticipate any changes in law, whether by legislative, governmental or judicial action, nor does it take into account provincial, territorial or foreign tax considerations, law or treaty.

This summary is not, and should not be construed as, advice to any particular holder as to Canadian tax consequences applicable to the holder.  Each holder is advised to obtain tax and legal advice applicable to the holder's particular circumstance.

Generally, dividends paid by Canadian corporations to non-resident shareholders are subject to a withholding tax of 250 of the gross amount of such dividends.  However, Article X of the tax treaty between Canada and the United States (Canada - United States Income Tax Convention, 1980) reduces to 15% the withholding tax on the gross amount of dividends paid to residents of the United States.  A further reduction in the withholding tax rate on the gross amount of dividends to 5% for dividends paid in 1997 and thereafter where a U.S. corporation owns at least 10% of the voting stock of the Canadian corporation paying the dividends.

A non-resident who holds common shares as a capital asset will not be subject to taxes on capital gains realized on the disposition of such common shares unless such common shares are "taxable Canadian property" within the meaning of the Tax Act and no relief is afforded under any applicable tax treaty.  The common shares would be taxable Canadian property of a non-resident if, at any time during the five year period immediately preceding a disposition by the non-resident of such common shares not less than 25% of the issued shares of any class of our common shares belonged to the non-resident persons with whom the non-resident did not deal at arm's length.

Material United States Federal Income Tax Consequences

The following is a general discussion of principal United States federal income tax consequences that may apply to a "U.S. Holder" (as defined below) of common shares.  This discussion is based upon the sections of the Internal Revenue Code of 1986, as amended (the "Code"), the Treasury Department regulations promulgated thereunder, published Internal Revenue Service ("IRS") rulings, published administrative positions of the IRS, and court decisions that are currently applicable, any or all of which could materially and adversely change at any time, possibly on a retroactive basis.  In addition, the discussion does not consider the potential effects, both adverse and beneficial, of any proposed legislation which, if enacted, could be applied at any time, possibly on a retroactive basis.

The following discussion is not intended to be, nor should it be construed to be, legal or tax advice to any holder or prospective holder of common shares.  We requested no opinion, nor was one provided, from our legal counsel and/or auditors, with respect to the United States federal income tax consequences described in the following discussion.  Accordingly, holders and prospective holders of common shares should consult their own tax advisors about the United States federal, state, local and foreign tax consequences of purchasing, owning, and disposing of common shares.

U.S. Holders

As used herein, a "U.S. Holder" includes a holder of common shares who is a citizen or resident of the United States, a corporation or partnership created or organized in or under the laws of the United States or of any political subdivision thereof, certain defined trusts and estates, and any other person or entity whose ownership of common shares is effectively connected with the conduct of a trade or business in the United States.  A U.S. Holder does not include persons subject to special provisions of Federal income tax law, such as tax-exempt organizations, qualified retirement plans, financial institutions, insurance companies, real estate investment trusts, regulated investment companies, broker-dealers, non-resident alien individuals or foreign corporations whose ownership of common shares is not effectively connected with the conduct of a trade or business in the United States and shareholders who acquired their stock through the exercise of employee stock options or otherwise as compensation.

Distributions on Common Shares

U.S. Holders receiving dividend distributions (including constructive dividends) with respect to common shares are required to include in gross income for United States federal income tax purposes the gross amount of such distributions to the extent that we have current or accumulated earnings and profits, without reduction for any Canadian income tax withheld from such distributions.  Under current law, certain dividends received by individuals are taxed at lower rates than items of ordinary income.  Any Canadian tax withheld with respect to a distribution may be credited, subject to certain limitations, against the U.S. Holder's United States federal income tax liability or, alternatively, may be deducted in computing the U.S. Holder's United States federal taxable income by those who itemize deductions.  See "Foreign Tax Credit" below.  To the extent that distributions exceed our current or accumulated earnings and profits, they will be treated first as a return of capital up to the U.S. Holder's adjusted basis in the common shares and thereafter as gain from the sale or exchange of the common shares.

In the case of distributions in Cdn. dollars, the amount of the distribution generally will equal the United States dollar value of the Cdn. dollars distributed, determined by reference to the spot currency exchange rate on the date of receipt of the distribution by the U.S. Holder, and the U.S. Holder will realize separate foreign currency gain or loss only to the extent that gain or loss arises on the actual disposition of foreign currency received.  Any foreign currency gain or loss generally will be treated as ordinary income or loss.

Dividends paid on the common shares generally will not be eligible for the dividends-received deduction available to corporations receiving dividends from certain United States corporations.

Foreign Tax Credit

A U.S. Holder who pays (or has withheld from distributions) Canadian income tax with respect to the ownership of our common shares may be entitled, at the option of the U.S. Holder, to either a deduction or a tax credit for such foreign tax paid or withheld.

Generally, it will be more advantageous to claim a credit because a credit reduces United States federal income taxes on a dollar-for-dollar basis, while a deduction merely reduces the taxpayer's income subject to tax.  This election is made on a year-by-year basis and applies to all foreign income taxes (or taxes in lieu of income tax) paid by (or withheld from) the U.S. Holder during the year.  There are significant and complex limitations which apply to the credit.  The availability of the foreign tax credit, and the limitations on the credit are fact-specific and holders and prospective holders of common shares should consult their own tax advisors regarding their individual circumstances.

Disposition of Common Shares

A U.S. Holder will recognize a gain or loss upon the sale of common shares equal to the difference, if any, between (i) the amount of cash plus the fair market value of any property received, and (ii) the shareholder's tax basis in the common shares.  This gain or loss will be a capital gain or loss if the common shares are a capital asset in the hands of the U.  S.  Holder, and will be a long-term capital gain or loss if the U.S. Holder has held the shares for more than one year.  Under current law, long-term capital gains of individuals are taxed at lower rates than items of ordinary income.  Deductions for net capital losses are subject to limitations.

Passive Foreign Investment Company

As a foreign corporation with U.S. Holders, we could potentially be treated as a passive foreign investment company ("PFIC"), as defined in Section 1297 of the Code, depending upon the percentage of our income which is passive, or the percentage of our assets which are held for the purpose of producing passive income.

The rules governing PFICs can have significant tax effects on U.S. shareholders of foreign corporations.  Section 1297 (a) of the Code defines a PFIC as a corporation that is not formed in the United States and, for any taxable year, either (i) 75% or more of its gross income is "passive income", which includes interest, dividends and certain rents and royalties or (ii) the average percentage, by fair market value (or, if we are a controlled foreign corporation or makes an election, by adjusted tax basis), of its assets that produce or are held for the production of "passive income" is 50% or more.  The taxation of a U.S. shareholder who owns stock in a PFIC is extremely complex and is therefore beyond the scope of this discussion.  U.S. persons should consult with their own tax advisors with regard to the impact of these rules.  However, we believe that we are not a PFIC.

Backup Withholding Tax

Backup withholding tax at a rate of 28% may apply to payments of dividends and to payments of proceeds of the sale or other disposition of our common shares within the United States by a non-corporate U.S. Holder, if the holder fails to furnish a correct taxpayer identification number or otherwise fails to comply with applicable requirements of the backup withholding tax rules.  Backup withholding tax is not an additional tax and amounts so withheld may be refunded or credited against a U.S. Holders United States federal income tax liability, provided that correct information is provided to the Internal Revenue Service.

E.

Dividends and Paying Agents

No dividends have been paid on any of our shares and we do not expect to pay dividends on our shares in the foreseeable future.

F.

Statement by Experts

Not applicable.

G.

Documents on Display

Our documents may be viewed at our head office 14604 - 115 A Avenue, Edmonton, Alberta, Canada.

H.

Subsidiary Information

We have seven subsidiary companies of which six are wholly owned and one is 85% owned.  The wholly owned subsidiaries are Resin Systems Incorporated, Resin Systems International Ltd., Resin Systems Sales Limited, Uni-Seal USA Ltd., RS Technologies Inc. and New Version Sport Inc. The 85% owned subsidiary is Uni-Seal Moulding Technologies Inc. All of the subsidiaries are inactive at this time, with the exception of Resin Systems International Ltd. and New Version Sport Inc.

ITEM 11.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We do not engage in any hedging or currency trading activities.  Our business activities are conducted in Cdn. and U.S. dollars and our assets and liabilities are recorded in Cdn. dollars.  Approximately 50% of our sales revenue is in U.S. dollars and substantially all of our costs of sales and administrative costs are in Cdn. dollars.  We have no U.S. dollar denominated assets.  U.S. dollar revenues have been less than $250,000 annually for each of the last three fiscal years.  As our accounts payable are in Cdn. dollars and some of our accounts receivable are in U.S. dollars, any appreciation in the value of the Cdn. dollar against the U.S. dollar would result in an exchange loss.

We monitor foreign exchange rates but have not taken action to date to reduce our exposure to significant fluctuations in currency exchange rates.  Management will review our exposure and will take such remedial steps as it considers necessary.

Our interest expenses and income are subject to changes in interest rates.  We have no outstanding debt other than that repayable to the National Research Council which is not subject to commercial interest rates.  Management has determined that fluctuation of up to 10% in interest rates would not materially affect our financial position or results of operations.

ITEM 12.

DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.

PART II

ITEM 13.

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.

ITEM 14.

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

None.

ITEM 15.

DISCLOSURE CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of our fiscal period  ended December 31, 2003, an evaluation of the effectiveness of our "disclosure controls and procedures" (as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended) was carried out by our principal executive officer and principal financial officer.  Based upon that evaluation, our principal executive officer and principal financial officer have concluded that as of the end of that fiscal period, our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

It should be noted that while our management believes that our disclosure controls and procedures provide a reasonable level of assurance, they do not expect that our disclosure controls and procedures or internal financial controls will prevent all errors and fraud.  A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

Changes in Internal Control Over Financial Reporting

During the fiscal period ended December 31, 2003, there were no changes in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

ITEM 16.

(RESERVED)

ITEM 16A.

AUDIT COMMITTEE FINANCIAL EXPERT

Our Board of Directors has appointed a new director who is our audit committee financial expert.  Mr. Zsolt Feketekuty, CA, MBA, is a Chartered Accountant with his own firm located in Edmonton.

ITEM 16B.

CODE OF ETHICS

We have adopted a "code of ethics" (as that term is defined in Form 20-F) (the "Code of Ethics") that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, and persons performing similar functions.  We will provide a copy of the Code of Ethics without charge, upon request, to anyone who requests it.  Copies of the Code of Ethics may be requested by contacting our Controller at our principal office located at 14604 - 115A Avenue, Edmonton, Alberta, Canada, T5M 3C5 (telephone (780)482-1953).

Since the adoption of the Code of Ethics, there have not been any amendments to the Code of Ethics or waivers, including implicit waivers, from any provision of the Code of Ethics.

ITEM 16C.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The following table provides information about the fees billed to us for professional services rendered by KPMG LLP during the fiscal period four months ended December 31, 2003 and fiscal years ended August 31, 2003 and 2002:

|(CDN $)                                         | Dec 31, 2003 | Aug 31,2003 | Aug 31, 2002
|----------------------------------------------- | ------------ | ----------- | ------------
|Audit Fees.................................     | $69,470      | $83,522     | $62,414     
|Audit-Related.Fees............................. | --           | --          | --          
|Tax Fees...................................     | 3,200        | --          | 1,300       
|All Other Fees.............................     | --           | --          | --          
|Total......................................     | $72,670      | $83,522     | $63,714     



a.

Audit Fees

Audit fees consist of fees for the audit of our annual financial statements or services that are normally provided in connection with statutory and regulatory filings or engagements.

b.

Audit-Related Fees

Audit-related fees consist of fees for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements and are not reported as Audit Fees.  During the fiscal period four months ended December 31, 2003 and the year ended August 31, 2003, the services provided in this category relate directly to advice and services required to complete our Form 20-F registration statement and annual filing for the fiscal years ended August 2002, August 2003, and December 2003 respectively.

c.

Tax Fees

During fiscal 2002 these fees relate to possible alternatives we had relating to certain financing opportunities.  In fiscal 2002 we moved our tax advice and service requirements for Canada and the United States to an independent firm in order to ensure KPMG LLP independence.  In fiscal 2003, we engaged KPMG to complete with respect to the provision of certain limited tax compliance services.

d.

All Other Fees

We do not have any other services provided by KPMG LLP other than those stated above.

e.

(1) Audit Committee Approval

All audit and non-audit services to be provided by our auditors are and will be pre-approved by our audit committee.

(2) Services Approved Pursuant to the De Minimus Exception

None of the fees reported in paragraphs (b) through (d) of this Item 16C were approved by our audit committee of the board of directors pursuant to the de minimus exception provided by Section (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

f.

Not applicable.

ITEM 16D.

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEE

Not applicable.

ITEM 16E.

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

None.

PART III

ITEM 17.

FINANCIAL STATEMENTS

The following Financial Statements are filed as part of this Annual Report, as exhibit 99.1.

|Management's Responsibility for Financial Statements | MR 1
|---------------------------------------------------- | ----
|Auditor's Report to Shareholders                     | FS 2
|Comments by Auditor for U.S. Readers on Canada -     |     
|U.S. Reporting Differences                           | FS 3
|Consolidated Balance Sheets                          | FS 4
|Consolidated Statements of Loss and Deficit          | FS 5
|Consolidated Statements of Cash Flows                | FS 6
|Notes to Consolidated Financial Statements           | FS 7

ITEM 18.

FINANCIAL STATEMENTS

Not applicable.

ITEM 19.

EXHIBITS

|Exhibit | Description                                                                                                                                                                            
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.      | ARTICLES OF INCORPORATION AND BY-LAWS                                                                                                                                                  
|1.1*    | By-Laws relating generally to the transaction of the business and affairs of Resin Systems Inc., and defining the Rights of Shareholders  dated September 17, 1998                    
|1.2*    | Certificate of Incorporation for Recycled Solutions for Industry (RSI) Inc.  dated July 26, 1995                                                                                      
|1.3*    | Certificate of Amendment of name change from Recycled Solutions for Industry (RSI) Inc., to Recycled Solutions for Industry Inc.  dated May 2, 1996                                   
|1.4*    | Certificate of Incorporation for Summerwood Industries Inc.  dated June 11, 1996                                                                                                      
|1.5*    | Certificate of Amendment of name change from Recycled Solutions for Industry Inc., to Resin Systems Inc.  dated May 5, 2000                                                           
|2.      | INSTRUMENTS DEFINING RIGHTS OF HOLDERS OF EQUITY SECURITIES BEING REGISTERED                                                                                                           
|2.1     | See 1.1 above                                                                                                                                                                          
|4.      | MATERIAL CONTRACTS                                                                                                                                                                     
|4.1*    | License Agreement between Uni-Seal Coatings Company and Recycled Solutions of Industry Inc.  dated July 31, 1996                                                                      
|4.2*    | Promissory Note between Resin and Officers and Directors - dated May 24, 2000                                                                                                          
|4.3    | Lease between  N.G. Campbell Holdings Ltd. and Resin Systems Inc. in respect of14604  115 A Avenue, Edmonton, Alberta - dated February 1, 2002                                        
|4.4***  | Collaborative Agreement between Resin Systems Inc. and the Alberta Research Council  dated March 28, 2002                                                                             
|4.5**   | Repayable Contribution Agreement between Resin Systems Inc. and the National Research Council  dated April 23, 2002                                                                   
|4.6**   | Private Placement Subscription Agreement for a maximum of 3,750,000 units of Resin Systems - dated June 30, 2002                                                                       
|4.7*    | Supply Agreement between Resin Systems and Dow Chemical Canada Inc.  dated May 1, 2002                                                                                                
|4.8a**  | Promissory note between Resin Systems and Douglas Grindstaff  dated July 11, 2002                                                                                                     
|4.8b   | Consulting agreement between Resin Systems and Douglas Grindstaff  dated July 15, 2002                                                                                                
|4.9##   | Time Escrow Agreement between Resin Systems, Computershare Trust Company of Canada, and various Security holders  dated October 15, 2002                                              
|4.9##   | 2002 Stock Option Plan  dated September 23, 2002                                                                                                                                      
|4.10   | Subscription Agreement for a maximum of 6,000,000 common shares of Resin Systems  December, 2002.                                                                                     
|4.11   | Canzeal Enterprises Ltd. Asset Purchase Agreement - dated January 6, 2003                                                                                                              
|4.12   | Technology Transfer Agreement between Resin Systems Inc. and Resin Systems International Ltd. - dated January 6, 2003                                                                  
|4.13   | Cost Sharing Agreement between Resin Systems Inc. and Resin Systems International Ltd. - dated January 6, 2003                                                                         
|4.14   | Distribution and Option for Manufacturing Agreement between Resin Systems Inc. and Harwell Hesco Electrical Supply - dated January 7, 2003                                             
|4.15   | Offer to Lease between Central Precision Limited: Care of Delco Remy America, Inc. and Resin Systems Inc. in respect of 14650 - 112 Avenue, Edmonton, Alberta - dated January 7, 2003  
|4.16   | Offer to Lease between Alger Management and Investments Limited and Resin Systems Inc. in respect of 14650 - 112 Avenue, Edmonton, Alberta - dated January 7, 2003                     
|4.17   | Agreement to provide design, support and consulting services between Resin Systems Inc. and Euro-Projects (LTTC) Ltd. - dated March 1, 2003                                            
|4.18   | Employment agreement between Mark Warren and Resin Systems Inc. - dated June 2, 2003                                                                                                   
|4.19   | Consulting Agreement between Paul Diemert and Resin Systems Inc. - dated August 1, 2003                                                                                                
|4.20   | Consulting Agreement between Phillip Lockwood and Resin Systems Inc. - dated August 1, 2003                                                                                            
|4.21   | Joint venture Agreement among Resin Systems International Ltd., Resin Systems Inc. and Euro-Projects (LTTC) Ltd. - dated August 30, 2003                                               
|4.22   | Operating Agreement among Resin Systems International Ltd., Resin Systems Inc., Euro-Projects (LTTC) Ltd. and RS Technologies Inc. - dated August 30, 2003.                            
|4.23   | Technology Licence Agreement among Euro-Projects (LTTC) Limited, Resin Systems Inc. and Resin Systems International Ltd. - dated August 30, 2003                                       
|4.24   | Office Lease between The Great-West Life Assurance Company and Resin Systems Inc. in respect of Meridian Corporate Park, 2421-37 Avenue NE, Calgary, Alberta - dated September 26, 2003
|4.25   | Agreement between Source Capital Group, Inc. and Resin Systems Inc. - dated October 17, 2003                                                                                           
|4.26   | Services Agreement between Resin Systems Inc. and Thorpe Beeston Investments Ltd. - dated November 7, 2003                                                                             
|4.27   | Distribution & Representation Agreement between Resin Systems Inc. and R.R. Interior Power & Electric Ltd. - dated November 19, 2003                                                   
|4.28   | Distribution & Representation Agreement between RS Technologies, a division of Resin Systems Inc. and EECOL Electric Inc. - dated January 2004                                         
|12      | CERTIFICATIONS PURSUANT TO RULE 13a-14(a) or 15d-14                                                                                                                                    
|12.1    | Certification of President and Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14 of the Securities Exchange Act of 1934                                                     
|12.2    | Certification of Controller pursuant to Rule 13a-14(a) or 15d-14 of the Securities Exchange Act of 1934                                                                                
|13      | CERTIFICATIONS PURSUANT TO SECTION 1350                                                                                                                                                
|13.1    | Section 1350 Certification of President and Chief Executive Officer                                                                                                                    
|13.2    | Section 1350 Certification of Controller                                                                                                                                               



*

Filed previously as an exhibit to our Form 20-F filed  March 31, 2002.

**

Filed previously as an exhibit to our Form 20-F filed    May 31, 2002

***

Filed previously as an exhibit to our Form 20-F filed August 30, 2002

#

Filed previously as an exhibit to our Form 20-F filed October 15, 2002

##

Filed previously as an exhibit to our Form 20-F filed November 12, 2002



Filed previously as an exhibit to our Form 20-F filed February 28, 2003.



Filed previously as an exhibit to our Form 20-F/A filed   March 3, 2004.