---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-QSB/AAmendment
No. 3

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2006

SALAMON GROUP, INC.(Name
of Small Business Registrant in its charter)

|Nevada                                   | 93-1324674                          
|---------------------------------------- | ------------------------------------
|(State or other jurisdiction of          | (I.R.S. Employer Identification no.)
|incorporation or organization)           |                                     
|                                         | V6E 1A3                             
|302-1028 Alberni Street                  | (Zip Code)                          
|Vancouver, B.C., Canada, V6E 1A3         |                                     
|(Address of principal executive offices) |                                     

(604) 408-3861(Issuer's telephone number)

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

|Title of each class | Name of each exchange on which registered
|------------------- | -----------------------------------------
|None                | None                                     

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

Common Stock, $0.001 par value per share(Title of class)

Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the past 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 [   ] No [X]

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

State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable date. 8,962,820 as of
September 30, 2006.

Copies of Communications Sent to: Claudia Losie
Boughton Law Corporation 595 Burrard Street, Suite 1000 Vancouver,
BC, Canada, V7X 1S8 Tel: (604) 687-6789 Fax: (604) 683-5317

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EXPLANATORY NOTE

Salamon Group, Inc. is amending its amended Quarterly Report
  on Form 10-QSB/A (the Report) for the quarterly period ended September
  30, 2006 filed with the Securities and Exchange Commission on February 2, 2007.
  This amendment is being made to amend Item 1 of Part I to the Report to include
  the Review Report of our Independent Registered Public Accountants to our balance
  sheet as of September 30, 2006 and the related statements of operations and
  cash flows for the three and nine-month periods ended September 30, 2006 and
  September 30, 2005. As part of the amendment of Item 1 of Part 1, we have also
  restated the balance sheet as of September 30, 2006 and the related statements
  of operations and cash flows for the three and nine-months ended September 30,
  2006 to correct certain mathematical inaccuracies and properly depreciate property
  and equipment. We are also filing Exhibit 15.1, our Independent Registered Accountants
  Review Report addressed to the U.S. Securities and Exchange Commission dated
  April 17, 2007. In accordance with Rule 12b-15, this amendment to the Report
  includes, as Exhibits 31.1, 31.2 and 32.1, the certifications required under
  Rule 13a-14.

2

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TABLE OF CONTENTS

|PART I.  | FINANCIAL INFORMATION                                                     | 4 
|-------- | ------------------------------------------------------------------------- | --
|         |                                                                           |   
|         | ITEM 1. FINANCIAL STATEMENTS                                              | 4 
|         |                                                                           |   
|         | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
      OF OPERATION   | 12
|         |                                                                           |   
|         | ITEM 3. CONTROLS AND PROCEDURES                                           | 19
|         |                                                                           |   
|PART II. | OTHER INFORMATION                                                         | 21
|         |                                                                           |   
|         | ITEM 1. LEGAL PROCEEDINGS                                                 | 21
|         |                                                                           |   
|         | ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE
      OF PROCEEDS | 21
|         |                                                                           |   
|         | ITEM 3. DEFAULTS UPON SENIOR SECURITIES                                   | 21
|         |                                                                           |   
|         | ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS              | 21
|         |                                                                           |   
|         | ITEM 5. OTHER INFORMATION                                                 | 21
|         |                                                                           |   
|         | ITEM 6. EXHIBITS                                                          | 22
|         |                                                                           |   
|         | SIGNATURES                                                                | 22

3

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

4

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Report of Independent Registered Public Accounting Firm

Board of Directors and Stockholders of Salamon Group, Inc.

We have reviewed the accompanying balance sheet of Salamon
Group, Inc. (a development stage company) (the Company) as of September 30,
2006, and the related statements of operations and cash flows for the three and
nine-month periods ended September 30, 2006. These interim financial statements
are the responsibility of the Companys management.

We conducted our review in accordance with standards of the
Public Company Accounting Oversight Board (United States). A review of interim
financial information consists principally of applying analytical procedures and
making inquiries of persons responsible for financial and accounting matters. It
is substantially less in scope than an audit conducted in accordance with
auditing standards generally accepted in the United States of America, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material
modifications that should be made to the accompanying financial statements for
them to be in conformity with accounting principles generally accepted in the
United States of America.

The accompanying financial statements have been prepared
assuming the Company will continue as a going concern. As more fully described
in Note 1, the Company has no revenues and has suffered recurring losses from
operations since inception, has a working capital deficit and has a deficit
accumulated during the development stage at December 31, 2006. These items,
among other matters, raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans in regard to these matters are
also described in Note 1. The financial statements do not include any
adjustments to reflect the possible future effects on the recoverability and
classification of assets or the amount and classification of liabilities that
may result from the outcome of this uncertainty.

/s/ KMJ I Corbin & Company LLP

Irvine, California 
  April 17, 2007

5

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SALAMON GROUP, INC.(A Development Stage Company)BALANCE SHEET

|                                                                                     |   | September 30, |  
|------------------------------------------------------------------------------------ | - | ------------- | -
|                                                                                     |   | 2006          |  
|                                                                                     |   | (unaudited)   |  
|                                                                                     |   | (restated)    |  
|ASSETS                                                                               |   |               |  
|Current assets:                                                                      |   |               |  
|Cash                                                                                 | $ | 47            |  
|Total
      assets                                                                   | $ | 47            |  
|                                                                                     |   |               |  
|LIABILITIES AND STOCKHOLDERS DEFICIT                                                |   |               |  
|Current liabilities:                                                                 |   |               |  
|Accounts payable                                                                     | $ | 9,832         |  
|Due to related party                                                                 |   | 76,959        |  
|Total current
      liabilities                                                      |   | 86,791        |  
|                                                                                     |   |               |  
|Commitments and contingencies                                                        |   |               |  
|                                                                                     |   |               |  
|Stockholders deficit:                                                               |   |               |  
|Preferred stock, no par
      value; 10,000,000 shares authorized; no shares issued  |   |               |  
|and outstanding                                                                      |   | -             |  
|Common stock, $0.001
      par value; 40,000,000 shares authorized; 8,962,820 shares |   |               |  
|issued and outstanding                                                               |   | 8,963         |  
|Additional paid-in
      capital                                                     |   | 120,816       |  
|Deficit accumulated during the
      development stage                               |   | (216,523      | )
|Total stockholders deficit                                                          |   | (86,744       | )
|                                                                                     |   |               |  
|                                                                                     | $ | 47            |  

6

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SALAMON GROUP, INC. (A Development Stage
Company) STATEMENTS OF OPERATIONS (unaudited)

Three Months Ended
    
    
    Nine Months EndedSeptember 30
    
    
    September 30,AccumulatedFrom April 27,2001(Inception) toSeptember 30,2006
    
    
    2005
    
    
    2006
    
    
    2005
    
    
    2006(restated)
    
    
    
    
    
    (restated)GENERAL AND ADMINISTRATIVE:Amortization of intangible asset
    $
    -
    
    $
    -
    
    $
    -
    
    $
    -
    
    $
    55,000Depreciation of
      property and equipment
    
    279
    
    
    -
    
    
    279
    
    
    -
    
    
    4,515Consulting and technical
      services
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    11,109Foreign exchange
    
    20
    
    
    36
    
    
    63
    
    
    310
    
    
    4,271Interest and bank charges
    
    15
    
    
    21
    
    
    52
    
    
    60
    
    
    498Office and
      miscellaneous
    
    600
    
    
    605
    
    
    1,800
    
    
    1,235
    
    
    12,332Professional fees
    
    1,100
    
    
    6,831
    
    
    1,634
    
    
    12,153
    
    
    67,133Telephone
    
    900
    
    
    543
    
    
    2,700
    
    
    2,251
    
    
    14,604Transfer agent and filing fees
    
    2,770
    
    
    954
    
    
    4,250
    
    
    5,050
    
    
    13,184Travel and
      entertainment
    
    1,500
    
    
    404
    
    
    4,500
    
    
    1,230
    
    
    33,877Net loss for the period
    $
    (7,184
    )
    $
    (9,394
    )
    $
    (15,278
    )
    $
    (22,259
    )
    $
    (216,523
    )Loss per share - basic
    $
    (0.00
    )
    $
    (0.00
    )
    $
    (0.00
    )
    $
    (0.00
    )Weighted average shares
      outstanding
    
    8,962,820
    
    
    8,962,820
    
    
    8,962,820
    
    
    8,962,820 7


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SALAMON GROUP, INC. (A Development Stage
Company) STATEMENTS OF CASH FLOWS (unaudited)

|                                                            |   | For The Nine  |   |   | For The Nine  |   |   | Accumulated From   |  
|----------------------------------------------------------- | - | ------------- | - | - | ------------- | - | - | ------------------ | -
|                                                            |   | Months Ended  |   |   | Months Ended  |   |   | April 27, 2001     |  
|                                                            |   | September 30, |   |   | September 30, |   |   | (Inception) to     |  
|                                                            |   | 2006          |   |   | 2005          |   |   | September 30, 2006 |  
|                                                            |   | (restated)    |   |   |               |   |   | (restated)         |  
|Cash flows from operating activities:                       |   |               |   |   |               |   |   |                    |  
|Net loss for the period                                     | $ | (15,278       | ) | $ | (22,259       | ) | $ | (216,523           | )
|Adjustments to reconcile net
      loss to net cash used in |   |               |   |   |               |   |   |                    |  
|operating
      activities:                                 |   |               |   |   |               |   |   |                    |  
|Amortization of intangible asset                            |   | -             |   |   | -             |   |   | 55,000             |  
|Depreciation of property and equipment                      |   | 279           |   |   | -             |   |   | 4,515              |  
|Estimated fair value of common stock issued for services    |   | -             |   |   | -             |   |   | 21,779             |  
|Changes in operating assets and liabilities:                |   |               |   |   |               |   |   |                    |  
|Increase (decrease) in accounts payable                     |   | (9,360        | ) |   | 653           |   |   | 9,832              |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Net cash used in operating
      activities                 |   | (24,359       | ) |   | (12,242       | ) |   | (125,397           | )
|                                                            |   |               |   |   |               |   |   |                    |  
|Cash flows from investing activities:                       |   |               |   |   |               |   |   |                    |  
|Purchase of property and equipment                          |   | -             |   |   | -             |   |   | (4,515             | )
|Purchase of license                                         |   | -             |   |   | -             |   |   | (50,000            | )
|                                                            |   |               |   |   |               |   |   |                    |  
|Net cash used in investing
      activities                 |   | -             |   |   | -             |   |   | (54,515            | )
|                                                            |   |               |   |   |               |   |   |                    |  
|Cash flows from financing activities:                       |   |               |   |   |               |   |   |                    |  
|Advances from related parties, net                          |   | 24,381        |   |   | 12,231        |   |   | 76,959             |  
|Issue of share capital for
      cash                       |   | -             |   |   | -             |   |   | 103,000            |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Net cash provided by financing
      activities             |   | 24,381        |   |   | 12,231        |   |   | 179,959            |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Change in cash                                              |   | 22            |   |   | (11           | ) |   | 47                 |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Cash, beginning of period                                   |   | 25            |   |   | 28            |   |   | -                  |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Cash, end of period                                         | $ | 47            |   | $ | 19            |   | $ | 47                 |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Supplemental disclosure of cash flow
      information:     |   |               |   |   |               |   |   |                    |  
|Cash paid during the period for:                            |   |               |   |   |               |   |   |                    |  
|Interest                                                    | $ | -             |   | $ | -             |   | $ | -                  |  
|Income tax                                                  | $ | -             |   | $ | -             |   | $ | -                  |  
|                                                            |   |               |   |   |               |   |   |                    |  
|Noncash:                                                    |   |               |   |   |               |   |   |                    |  
|Estimated fair value of common stock issued for license     | $ | -             |   | $ | -             |   | $ | 5,000              |  

8

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SALAMON GROUP, INC. (A Development Stage
Company) NOTES TO FINANCIAL STATEMENTS (unaudited)

|1. | Nature of Operations and Continuance of
Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Salamon Group, Inc. (the "Company") was incorporated in
      the State of Nevada, USA, on April 27, 2001 (Inception). The Company is
      a development stage company whose principal business plan is to seek
      earnings by exploiting technology held under a license
agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | These financial statements have been prepared in
      accordance with accounting principles generally accepted in the United
      States of America applicable to a going concern. At September 30, 2006,
      the Company has no revenues to date, has accumulated losses of $216,523
      (restated) and a working capital deficit of $86,744 and expects to incur
      further losses in the development of its business, all of which cast
      substantial doubt about the Companys ability to continue as a going
      concern. Management plans to continue to provide for the Company's capital
      needs during the 12 months ended September 30, 2007 by issuing debt and
      equity securities and by the continued support of its related party. The
      financial statements do not include any adjustments relating to the
      recoverability and classification of recorded asset amounts or amounts and
      classification of liabilities that might be necessary should the Company
      be unable to continue in existence. There is no assurance that funding
      will be available to continue the Companys business operations.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | On July 5, 2001, the Company entered into a licensing
      agreement with Space Globe Technologies Ltd. ("Space Globe"), a Canadian
      corporation. The agreement allows the Company to use certain technology
      with respect to a power cell technology used for internal and external
      electrical applications.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | In January, 2005, Space Globe Technologies and Salamon
      Group in mutual agreement replaced the license agreement with an Agreement
      which transferred 100% ownership of and rights to the Technology to
      Salamon Group for no additional compensation. John Salamon also assigned
      all rights to the patent pending to Salamon Group.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|2. | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

Computer equipment
    3 years straight-lineOffice equipment
    5 years straight-line


| | (c) | Basic and diluted net loss per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | The Company computes net loss per share in accordance
      with SFAS No. 128, Earnings per Share (SFAS No. 128). SFAS No. 128
      requires presentation of both basic and diluted earnings per shares
      (EPS) on the face of the statement of operations. Basic EPS is computed
      by dividing net loss available to common shareholders (numerator) by the
      weighted average number of common shares outstanding (denominator) during
      the period. Diluted EPS gives effect to all dilutive potential common
      shares outstanding during the period including stock options, using the
      treasury stock method, and convertible preferred stock, using the
      if-converted method. In computing Diluted EPS, the average stock price for
      the period is used in determining the number of shares assumed to be
      purchased from the exercise of stock options or warrants. Diluted EPS
      excludes all dilutive potential common shares if their effect is
      antidilutive. At September 30, 2006 and 2005, there are no potentially
      dilutive instruments outstanding.

9

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**SALAMON GROUP, INC.** **(A Development
Stage Company)** **NOTES TO FINANCIAL STATEMENTS**
(unaudited)

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | (d)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (e)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (f)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (g)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (h)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (i)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (j)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           

10

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**SALAMON GROUP, INC.** **(A Development
Stage Company)** **NOTES TO FINANCIAL STATEMENTS**
(unaudited)

|3. | Related Party Transactions                                                                                                                                                                                                                                        
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                   
|4. | Restatement                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                   
|   | The Company determined that the previously filed Form
      10-QSB and Form 10-QSB/A for the period ended September 30, 2006 contained
      certain mathematical inaccuracies. In addition, the Company did not
      properly depreciate property and equipment.
|   |                                                                                                                                                                                                                                                                   
|   | The following tables present a summary of the effects of
      the restatement adjustments on the Company's balance sheet at September
      30, 2006 and the statements of operations and cash flows for the period
      then ended:                            
|   |                                                                                                                                                                                                                                                                   
|   | Balance sheet at September 30,
2006:                                                                                                                                                                                                                              

| |                        |   | AS PREVIOUSLY |   |  |             |   |     |   |                   |  
| | ---------------------- | - | ------------- | - |  | ----------- | - | --- | - | ----------------- | -
| |                        |   | REPORTED      |   |  | ADJUSTMENTS |   |     |   | AS
      RESTATED |  
| | Property and equipment | $ | 279           |   |  | (279        | ) |     | $ | -                 |  
| |                        |   |               |   |  |             |   |     |   |                   |  
| | Stockholders' deficit  | $ | (86, 465      | ) |  | (279        | ) | (1) | $ | (86,774           | )

Statement of operations for the nine
months ended September 30, 2006:

| |                            |   | As previously |   |   |             |      |   |             |  
| | -------------------------- | - | ------------- | - | - | ----------- | ---- | - | ----------- | -
| |                            |   | reported      |   |   | Adjustments |      |   | As restated |  
| | General and administrative | $ | 14,999        |   | $ | 279         | (1)  | $ | 15,278      |  
| |                            |   |               |   |   |             |      |   |             |  
| | Net loss                   |   | (14,999       | ) |   | (279        | )(1) |   | (15,278     | )

(1) To properly depreciate property and
  equipment.

11

---

Item 2. Management's Discussion and Analysis or Plan of
Operation. Plan of Operation

Since its inception, the Company
has conducted no business operations except for organizational and capital
raising activities and the completion of a working model of the Power generator.
For the period from inception (April 27, 2001) through September 30, 2006, the
Company had no revenue from operations and accumulated operating expenses
amounted to $216,523 (restated). The Company proposes to aggressively compete in
the alternative energy source technology market.

The Company plans to generate
revenues through the sale of manufacturing and marketing licenses on a
world-wide basis.

Salamon Group will also be
involved in research and development activities . The corporation will search
for a private investment group to provide up to $200,000 CAD, to cover the costs
of product development. All products will be licensed to other corporations for
manufacturing, thus no additional money is anticipated to be used to manufacture
and/or distribute.

Future research and development
will be focused on smaller, portable EPGs adding a solar power component. Mr
Salamon has a conceptual design and will proceed with plans when funding allows.

The Company is not planning to
  purchase a plant or equipment at this time but rather to enter into Licensing
  agreements to manufacture and market the products.

If the Company is unable to
generate sufficient revenue from operations to implement its plans, management
intends to explore all available alternatives for debt and/or equity financing,
including but not limited to private and public securities offerings. Depending
upon the amount of revenue, if any, generated by the Company, management
anticipates that it will be able to satisfy its cash requirements for the next
approximately nine (9) to twelve (12) months without raising funds via debt
and/or equity financing or from third party funding sources.

Accordingly, management expects
that it will be necessary for Salamon Group to raise additional funds in the
event that the Company is unable to generate any revenue from operations and if
only a minimal level of revenue is generated in accordance with management's
expectations.

Mr. Salamon, at least initially,
will be responsible for developing Salamon Group's business. However, at such
time, if ever, as sufficient operating capital becomes available, he expects to
employ additional staffing. In addition, the Company expects to continuously
engage in market research in order to monitor new market trends and other
critical information deemed relevant to Salamon Group's business.

Financial Condition, Capital Resources and Liquidity

At September 30, 2006, the
Company had assets totaling $47 and current liabilities of $86,791 attributable
to unpaid Space Globe Technologies license fees, audit fees and general
operating expenses. Since the Company's inception, it has received $124,779 in
cash and services contributed as consideration for the issuance of shares of
common stock.

Salamon Group's working capital
is presently minimal and there can be no assurance that the Company's financial
condition will improve. The Company is expected to continue to have minimal
working capital or a working capital deficit as a result of current liabilities.
The Company, at inception, issued 1,500,000 shares of the Company's Common Stock
to Mr. Salamon, the executive officer and director of Salamon Group, and 500,000
shares of the Company's Common Stock to White & Lee Investments, LP, an
investment vehicle controlled by White & Lee LLP, former legal counsel to
the Company, as founder shares. From April 2001 through September 30, 2006, the
Company has received gross proceeds of $103,000 and received services valued at
$21,779 from the issuance of a total of 2,515,010 and 1,447,810 shares of common
stock, respectively. Even though management believes, without assurance, that it
will obtain sufficient capital with which to implement its business plan on a
limited scale, the Company is not expected to continue in operation without an
infusion of capital. In order to obtain additional equity financing, management
may be required to dilute the interest of existing shareholders or forego a
substantial interest of its revenues, if any.

The Company has no potential
capital resources from any outside sources at the current time. In its initial
phase, the Company will operate out of the facility provided by Mr. Salamon.

The ability of the Company to
continue as a going concern is dependent upon its ability to attract a
sufficiently large and profitable licensee base to license its electrical
generator technology.

To implement such plan, also during
  this initial phase, the Company intends to initiate a self-directed private
  placement under Rule 506 in order to raise an additional $200,000. In the event
  such placement is successful, the Company believes that it will have sufficient
  operating capital to meet the initial expansion goals and operating costs for
  a period of one (1) year.

12

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Net Operating Losses

As of September 30, 2006, the
Company has net operating losses of approximately $216,523 (restated).

Forward-Looking Statements

This Form 10-QSB includes
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. All statements, other than statements of historical facts, included
in this Form 10-QSB which address activities, events or developments which the
Company expects or anticipates will or may occur in the future, including such
things as future capital expenditures (including the amount and nature thereof),
business strategy, expansion and growth of the Company's business and
operations, and other such matters are forward-looking statements. These
statements are based on certain assumptions and analyses made by the Company in
light of its experience and its perception of historical trends, current
conditions and expected future developments as well as other factors it believes
are appropriate in the circumstances. However, whether actual results or
developments will conform with the Company's expectations and predictions is
subject to a number of risks and uncertainties, general economic market and
business conditions; the business opportunities (or lack thereof) that may be
presented to and pursued by the Company; changes in laws or regulation; and
other factors, most of which are beyond the control of the Company.
Consequently, all of the forward-looking statements made in this Form 10-QSB are
qualified by these cautionary statements and there can be no assurance that the
actual results or developments anticipated by the Company will be realized or,
even if substantially realized, that they will have the expected consequence to
or effects on the Company or its business or operations. The Company assumes no
obligations to update any such forward-looking statements.

Business Development.

SALAMON GROUP, INC. (hereinafter
referred to as the Company or Salamon Group) was organized under the laws of
the State of Nevada on April 27, 2001. The Company is a developmental stage
company organized by John E. Salamon, the President and Director of the Company.
The Companys aim is to develop, license and/or acquire certain electrical
generator technologies which the Company believes to be proprietary. The
Company's offices are presently located at 302-1028 Alberni Street, Vancouver,
B.C., Canada, V6E 1A3 and its telephone number is (604) 408-3861. The Companys
Nevada registered agent is National Registered Agents, Inc. of NV, 1100 East
William Street, Suite 207, Carson City, NV 89701.

Every public issuer of stock engaged
  in interstate business and which has total assets exceeding $ 1 million and
  has more than 750 shareholders is required to register its securities with the
  Securities and Exchange Commission under the Exchange Act of 1934. The Company
  has not reached these threshold requirements and is therefore exempt from required
  registration under Section 12(g) of the Exchange Act. However, a Form 10-SB
  registration statement has been filed on a voluntary basis in order to possibly
  enhance shareholder and investor confidence by way of full disclosure of the
  Companys current status and financial condition. Registration may also
  allow the Company to establish a trading market on the OTC Bulletin Board. We
  believe that registration may assist in securing private investment capital
  which is needed to complete product testing, to establish a market for its product
  and to continue research and development of additional products.

Since its inception the Company
has been involved in organizational and fund raising activities and the
licensing, subsequent acquisition and further development of certain electrical
generator technology from Space Globe Technologies Ltd., a private British
Columbia, Canada corporation (Space Globe Technologies), founded and organized
also by John Salamon, founder, president and director of Salamon Group, Inc.
Space Globe Technologies was founded for the purpose of developing technologies
and concepts in the field of Alternative Energy Sources. Alternative Energy
Sources are those which are not supplied by the burning of fossil fuels or the
splitting of atoms. Some of the alternative energy sources include solar energy,
wind power, geothermal, tides and hydro power. Space Globe Technologies was
incorporated in the Province of British Columbia, Canada in 1998 by John
Salamon. It was initially established as a management/consulting company and in
which to develop ideas and concepts for power generation. The assets at present
consist of a vehicle, office equipment and investments in Salamon group. Its
current operation consists mainly of securing private investment capital to
assist in funding the operations and growth of Salamon Group. From 1999 to 2001
Space Globe and Mr. Salamon developed the concept and design of an Electrical
Power Generator (EPG) for home and office use and for emergency power backup
situations. Mr. Salamon filed a patent application in Canada on September 4,
2001 for protection of the design of the EPG.

The Company initially distributed
to Mr. John E. Salamon and White & Lee Investments, L.P. a total of
1,500,000 and 500,000 shares, respectively, of common stock, $0.001 par value
per share (Common Stock). These founders shares were issued pursuant to
Section 4(2) of the Securities Act of 1933 (the Act).

Mr. Salamon formed the Company
for the purpose of pursuing his business plan of developing technologies and
concepts in the field of Alternative Energy Sources in a newly established
Nevada corporation. All transactions described below between the Company and
Space Globe Technologies were incidental to the transfer of assets to the
Company in connection with the reorganization of these two entities under Mr.
Salamons common control.

On July 5, 2001, the Company entered
  into a Technology License Agreement with Space Globe Technologies whereby the
  Company agreed to pay $50,000 cash and issued 5,000,000 shares of Common Stock
  to Space Globe Technologies as license fees for the technology related to the
  EPG. The cost of the license was determined to be at an estimated cost of research
  and development time and materials expended by Space

13

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Globe for the development of the EPG. The 5,000,000 shares
issued in connection with such Technology License Agreement were issued pursuant
to Section 4(2) of the Act at their par value of $0.001 each and the cash was
subsequently paid from proceeds of private placements in Salamon Group.

In January, 2005, Space Globe
Technologies and Salamon Group replaced the license agreement with an agreement
which transferred 100% ownership of and rights to the technology were
transferred from Space Globe Technologies to Salamon Group for no additional
compensation. John Salamon also assigned all rights to the patent pending to
Salamon Group.

In addition to the foregoing
issuances, from April 2001 through September 30, 2006, Salamon Group received
gross proceeds of $124,779 (including $103,000 in cash and services valued at
$21,779) from the sale of a total of 1,962,820 shares of Common Stock in an
offering conducted pursuant to Section 4(2) of the Act and Regulation S. (See
Part II, Item 4. Recent Sales of Unregistered Securities). These offerings were
made in the Provinces of British Columbia and Alberta, Canada.

The Company intends to offer
additional securities under Rule 506 and Regulation S to fund its short and
medium term expansion plans.

See (b) Business of Registrant
immediately below for a description of the Company's proposed business. As of
the date hereof, the Company has no other employees or customers.

Technology/Product

The EPG device consists of an
electric motor, an alternator, a regulator system, an inverter, a capacitor, an
isolator, a primary battery and a secondary battery. These parts are all
contained in a metal or plastic molded encasement. The primary 12 Volt battery
supplies current and voltage to an inverter which converts the 12V DC voltage to
115V AC voltage. The AC voltage is then supplies power to any AC powered device
such as a television, lamp, radio, small appliances, etc. (depending on required
wattage.)

During operation of the device, a
control system that is powered by the secondary 12V battery, monitors the
primary battery voltage. When the primary battery voltage drops below a setpoint
voltage, the control system starts the electric motor, which in turn drives an
alternator/generator that recharges the primary battery. The
alternator/generator produces AC voltage which is converted to DC voltage and
regulated through a regulator system. The regulator system includes an isolator
which directs the power from the regulator system into the primary battery
allowing the primary battery to be recharged, but the isolator prevents the
direct connection of both batteries. When the primary battery voltage reaches an
upper setpoint voltage, the control system will disable the electric motor and
the recharging of the primary battery will cease. The cycle will repeat itself
again when the primary battery voltage is below the lower setpoint voltage.

Salamon Group has not yet tested
the EPG to determine how long it can supply power before both batteries become
depleted. A connection to an external power supply is provided so that the
secondary battery can be recharged if for some reason, such as long dormant
storage periods, both batteries become completely depleted. The external power
supply is a power supply that converts household current to 12 VDC. For example,
this type of power supply could be a wall transformer type that converts 115 VAC
to 12 VDC.

The performance of the EPG is
relative to the size of the inverter and the number of batteries. For example, a
300 watt inverter can be used to power a TV, laptop computer or a lamp, among
other things. The proof-of-concept model EPG is 115 VAC and 300 watts with a 12
VDC outlet. The charging cycle is relative to the load on the inverter. The
greater the load, the faster the main battery depletes. The typical midsize
EPG requires no venting as it uses sealed batteries and creates a negligible
amount of heat. When charging, it produces a noise level similar to that of a
turntable style microwave. Because there are no emissions of any sort, the EPG
can be used indoors as opposed to fuel powered generators which can only be used
outdoors. All components of the EPG are CSA approved in Canada. All licensees
will be in compliance with Canadian standards and will be required to comply
with standards of the USA and other countries prior to distributing the EPG in
those countries.

The EPG can be used as emergency
  back-up power for the homeowner in the event of a power failure. It can also
  be used to power small appliances/devices in portable applications such as camping
  or in a remote cottage setting. It can also power communication equipment during
  disaster relief efforts. Any number of devices can run from the EPG as long
  as the combined power of the devices do not exceed the maximum power of the
  inverter. For example, if a lamp uses 60W and the inverter is rated at 300W
  maximum, 5 lamps can be run. If a TV at 160W is to be powered, and a DVD player
  at 15W, then only two 60W lamps may be powered. It is not currently known how
  long the EPG may run devices until both batteries are depleted. This will be
  determined only when the working model described below has undergone extensive
  testing.

14

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Proof-of-Concept and Working Models

A prototype was built by Space
Globe in 2002 and was provided to Salamon Group for further development. In
2004, Salamon Group completed construction of a proof-of-concept model which is
now available for demonstration to potential licensees. The encasement of the
model measures 18L x 11W x 10.5H and weighs approximately 60 pounds with all
the components in it. The primary battery is a sealed deep cycle battery rated
at 33AH with output voltage of 12 VDC and weighs 25 pounds. The secondary
battery is also a sealed deep cycle unit with output voltage of 12 VDC and
weighs 9 pounds.

The recharging voltage for both
batteries is in the 14.4V to 14.6V range. The charge level is determined the
non-charging/non-discharging voltage of the battery with 12.80V being a full
charge, 12.30V a half charge and 11.80V being fully discharged. The
proof-of-concept model does not have the automated control system. The model was
used for the battery testing.

The following are the detailed
specifications of the proof-of-concept model: Battery and Alternator
Specifications :

Primary Battery:

12 Volt/33 Ampere Valve Regulated Lead-Acid Battery

|a) | Ampere Hour Capacity to 1.75 Volts per Cell
  @77F:
|-- | ---------------------------------------------------

Discharge in Hours
    Amp-Hr Capacity1.00
    23.52.00
    25.93.00
    27.24.00
    28.15.00
    29.06.00
    29.77.00
    30.28.00
    30.510.00
    31.012.00
    31.520.00
    33.024.00
    33.172.00
    33.8100.00
    34.4


|b) | Specifications:
|-- | ---------------

BCI Group Size
    U1Cells per unit
    6Full Charge OCV
    12.84Electrolyte
    Absorbed H2SO4Max Discharge Current
    600 Amps @ 0.1 secShort Circuit Current
    2150 AmpsOhms Imped 60 Hz
    0.007 Ohms


|c) | Discharge Ratings (in amps) at Constant Discharge Time
      (in hours)
|-- | -----------------------------------------------------------------------

End Point
      Volts/Cell
    .083
    10.0
    100.001.90
    87.0
    2.73
    0.301.85
    101.0
    2.90
    0.331.80
    113.0
    3.02
    0.341.75
    121.0
    3.10
    0.34 15


---

|d) | Capacity
|-- | --------

| | 29.0 Ah @ 5Hr
      rate to 1.75 volts per cell @ 77`F   
| | ---------------------------------------------------------
| | 33.0 Ah @ 20 hr rate to1.75 volts
      per cell 2 77`F  
| | 29.6 Ah @ 10 hr
      rate to 1.80 volts per cell @ 68` F

|e) | Operating Temperature Range                                                                                                                                                                              
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                          
|   | Discharge: -40`F to 160`F                                                                                                                                                                                
|   | Charge:-10`F to +140`F(with temperature
    compensation)                                                                                                                                                
|   |                                                                                                                                                                                                          
|f) | Float Charging voltage                                                                                                                                                                                   
|   |                                                                                                                                                                                                          
|   | 13.5 to 13.8 VDV/unit Average @ 77`F                                                                                                                                                                     
|   |                                                                                                                                                                                                          
|g) | Recommended Maximum Charging Current Limit                                                                                                                                                               
|   |                                                                                                                                                                                                          
|   | C/5 amperes (6.6 amperes @ 100% depth of discharge) @ 20
      hour rate                                                                                                                                 
|   |                                                                                                                                                                                                          
|h) | Equalization and Cycle Service Charging Voltage                                                                                                                                                          
|   |                                                                                                                                                                                                          
|   | 14.4 to 14.8 VDC/unit Average @ 77`F                                                                                                                                                                     
|   |                                                                                                                                                                                                          
|i) | Maximum AC Ripple (Charger)                                                                                                                                                                              
|   |                                                                                                                                                                                                          
|   | 0.5% RMS or 1.5% P-P of float charge voltage recommended
      for best results Maximum AC ripple float charge voltage allowed=(4%
      P-P) Maximum AC ripple current allowed=1.65 amperes RMS
  (C/20)
|   |                                                                                                                                                                                                          
|j) | Self Discharge                                                                                                                                                                                           
|   |                                                                                                                                                                                                          
|   | Battery may be stored for up to 6 months @ 77`F and then
      a refreshing charge is required. For higher temperatures the time interval
      will be shorter.                                         

Secondary Battery:

12 Volt 18 AH Sealed Lead Acid Recharging specs are similar
to the Main battery above.

Alternator Specs:

|Speed:                    | 1300-6000 RPM          
|------------------------- | -----------------------
|Charging capacity:        | 15-16.5A @ 14V @5000RPM
|Output Current Vs. Speed: | ~0A @1000RPM           
|                          | ~3A @2000RPM           
|                          | 9.5-10.5A@3000RPM      
|                          | 13-14A @4000 RPM       

The Company has now developed and completed the assembly of a
working model, which contains a bigger battery.

The following are the specifications of the working model:

Battery and Alternator Specifications :

Primary Battery:

12 Volt 50 AH Deep-Cycle Sealed Lead-Acid Battery

Secondary Battery:

12 Volt 18 AH Sealed Lead Acid Battery

16

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Alternator Specs:

|Speed:                    | 1300-6000 RPM          
|------------------------- | -----------------------
|Charging capacity:        | 15-16.5A @ 14V @5000RPM
|Output Current Vs. Speed: | ~0A @1000RPM           
|                          | ~3A @2000RPM           
|                          | 9.5-10.5A@3000RPM      
|                          | 13-14A @4000 RPM       

The working model will require
further testing to ensure that the control system is working as expected, to
test the life of the batteries, and to determine if any component parts need to
be upgraded. If required for further testing of the working model, the Company
may engage an independent consulting engineer, subject to obtaining the
necessary capital. To date, no independent evaluations have been done.

Technical Limitations:

The technical limitations of the
EPG are related to the recharging of the primary battery. The alternator should
be large enough to recharge the primary battery while the inverter is under full
load.

If the alternator is not rated to output more power than the
inverter can draw, then eventually the primary battery will be totally depleted
and the inverter will cease to produce power. When there is no more load on the
primary battery, it can be recharged again for future use.

The actual length of time that
the EPG can provide power without completely depleting both batteries will not
be known without extensive testing. If the EPG has sat dormant for a long time
and both batteries have become depleted, then an external power source can be
used to recharge the secondary battery. The external power supply is a power
supply that converts household current to 12 VDC. For example, this type of
power supply could be a wall transformer type that converts 115 VAC to 12 VDC.
As a result of these technical limitations, the EPGs utility may be restricted
to providing power for only smaller appliances, which reduce its commercial
appeal.

Regulatory Approvals

This electrical device is made up
of various parts, as outlined very carefully in the schematic drawings. Each and
every electrical component contained within the research models have already
been approved in Canada under a set of rules called CSA. The inverters,
control mechanisms, batteries, and all other component parts have been CSA
approved. By extension, all working models, as well as future commercial units,
must contain only CSA approved electrical components, if manufactured and/or
sold within Canada. Further, any licensee, legally licensed by the Salamon Group
to manufacture within the United States of America, must comply with any and all
USA government rules covering the manufacturing of electrical devices with the
USA. A minimum requirement would involve the manufacturer satisfying rules set
down under the set of regulations called UL. All completed units would have to
be labeled UL Approved. Salamon Group intends to pursue arrangements whereby
independent manufacturers will, under license obligations to the Salamon Group,
manufacture and be prime distributors of the product. Due to the nature of the
EPG, any manufacturer must comply with CSA regulations.

CSA Certification guidelines
require a completed unit to be included with the CSA Certification application
process to satisfy safety testing requirements. The Company will submit all
applications for approvals and to pay all associated costs.

Canadian Patent Rules

Through a patent, the government
grants an inventor the right to exclude others from making, using or selling the
invention from the day the patent is granted to a maximum of 20 years after the
day on which a patent application is filed. The Patent Office lays open the
application 18 months after the filing date of the application. Anyone may then
read about, but not make, use or sell the invention without the applicants
permission until the patent has expired. The application remains  Patent
Pending until a patent is granted or refused. The applicant must formally
request an examination of the Patent Pending application within 5 years of the
filing date, otherwise the application will be considered abandoned. A Patent
Pending application provides time to assess the feasibility and/or marketability
of the invention and provides some protection for the invention without having
to fully commit to the patent procedures. Competitors will likely be wary of
infringing on the invention after the application is published because the
inventor could seek retroactive compensation in the event that a patent is
granted.

Patent Pending

Request For Examination of Patent
will be filed by September 4, 2006.

Date: 2006/08/29 of
Acknowledgement by Canadian Patent Office of Request For Examination of Canadian
Patent No: 2,357,766. A filing fee of $400.,was paid to the Canadian Patent
Office.

A Patent application (2,357,766)
  was filed in Canada by John Salamon on September 4, 2001. The application is
  pending and will be examined when informed by the Canadian Patent
  Office. Request for Examination started in August 2006. The Company intends
  to apply for

17

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Patent in the US and other countries as soon as financially
possible at a cost of approximately $20,000 or more. The Company feels it is
necessary to file a Patent application in the United States as this might be one
of its largest markets.

Manufacturing

At this time, the Company is
attempting to secure licensees who will be granted the rights to commercially
produce, manufacture, market and sell the product worldwide. The Company will
provide the technological design to the licensee(s) for their use in producing
the product. If licensees cannot be arranged, the Company will seek financing to
manufacture the EPG itself. As yet, neither licensees nor suppliers of the
component parts of the EPG have been secured or arranged.

Sales and Marketing

The Company is seeking potential
qualified licensees, which will be granted the right to manufacture, market and
sell the EPG. A qualified licensee will have a successful experience in
marketing electronic devices, and will have knowledge of both sales strategies
and electronic technology. Furthermore, a qualified licensee will have the
network to place the EPG in appropriate large chain stores.

We believe that prospective
licensees would not make an issued patent a precondition for any license
payments. There are many products and devices on the market that have only
patent pending status. Having a patent pending does afford the applicant
certain protections. If the licensee believes that the particular product has a
competitive advantage in the marketplace and has a good prospect for sales to
consumers, we believe the licensee will not be deterred by the fact that the
patent has not yet issued in respect of the EPG.

Management

At this time, the Company is
managed by John Salamon. As finances allow, other personnel will be employed in
various management capacities.

Mr. Salamon began his working
career in the oil industry in Alberta, Canada in 1966. From 1966 to 1985, he
performed various jobs in the oilfields and on drilling platforms for several
oil companies in Canada, United States, England, Africa, Saudi Arabia, Bahrain,
Malta and Peru. His duties included repair and maintenance of electric motors
and generators which provided Mr. Salamon with a comprehensive understanding of
the workings of electric powered devices.

From 1986 to 1990 assisted with
the development of a shopping mall and other properties in Northern Alberta.
From 1991 to 1998, Mr. Salamon contracted to Globus Cellular & to Beitler
Consulting to provide technical and marketing services for their products. In
1998, Mr. Salamon formed Space Globe Technologies to continue research and
development of technologies and products in the field of electric power
generation. In 2001, Mr. Salamon formed Salamon Group, Inc. to license and/or
purchase technologies in the field of electric power generation. From 1998 to
date Mr.Salamon has been directing and managing both companies.

Consultants and Technicians :

The Company employs consultants
and technicians on a contract and on an as needed basis.. During 2004, Salamon
Group engaged Mr. Mike Ewashen to assist in the completion of the assembly of
the working model of the EPG device. Mr. Ewashen, a certified Electronics
Technician, has been working in the field of electronics for the past 18 years.

Research and Development

Until the Company can secure a
qualified licensee, all further development, testing and commercialization of
the EPG will be completed by the Company, subject to obtaining the necessary
financing. Upon securing a qualified licensee, any further research, development
and commercialization of the EPG and all related costs will be the
responsibility of the licensee.

The Company, under the direction
of Mr. Salamon, is continually researching and studying alternative energy
sources and plans to develop other power generation devices as capital funding
becomes available. Alternative Energy Sources are those which are not supplied
by the burning of fossil fuels or the splitting of atoms. Some of the
alternative energy sources include solar energy, wind power, geothermal, tides
and hydro power.

The Company is currently and may
develop a smaller, portable EPG utilizing similar designs and adding a solar
power component as well as an electric wireless product.

Facilities

In its initial phase, the Company
  will operate out of offices provided by Mr. Salamon. The Company address is
  302-1028 Alberni Street, Vancouver, B.C., Canada, V6E-1A3. Mr. Salamon will
  begin researching the real estate market in order to determine the most appropriate
  site to locate Salamon Group's offices and facilities.

18

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Funding

The Company plans to raise
approximately $200,000 by way of private placements from relatives and business
associates of John Salamon. As soon as possible, the Company will seek public
trading status which will enable the Company to raise additional development and
working capital. The funds will be used to secures license agreements, to
continue research and development and for general working capital. The Company
also plans to seek bank financing.

To implement the initial plan,
the Company intends to initiate a private placement under Rule 506 in order to
raise an additional $200,000. In the event such placement is successful, the
Company believes that it will have sufficient operating capital to meet the
initial goals and operating costs for a period of twelve (12) months.

Competition

The markets in which the Company
is engaged are subject to vigorous competition. Energy generation is a
constantly evolving industry and is dominated by and impacted by large
multi-national oil companies.

There are many portable products
similar to the EPG available on the market, including gasoline and diesel
powered generators, and battery/inverter types of portable power sources. The
Company currently sees its fiercest competition coming from manufacturers of
portable gasoline powered generators.

The main advantages of the EPG
over a gas or diesel powered generator are that unlike fuel-powered generators,
the EPG can be used indoors because of its size, it has negligible noise level
and it does not emit any exhaust. The EPG can be used indoors, for example, as
emergency back-up power for the homeowner. Another significant advantage of the
EPG is that no dangerous flammable fuel is required.

While the EPG is designed to
recharge the primary battery to prolong the availability of power, the extent to
which the EPG can provide prolonged availability of power will not be known
without extensive testing. The battery/inverter systems that are currently on
the market must be recharged with an external source such as a wall transformer
or solar panel before they can be used again after the battery is depleted.
Until further testing of the EPG is completed, it is not known whether its
performance is even equivalent to existing battery inverter products.

Gasoline generators are more
expensive than the EPG. The prices of gasoline generators vary depending on the
size. Gasoline generators in the 900W to 1500W range are priced in thr range of
$475 to $525. The anticipated retail cost of the EPG will be in the low hundreds
of dollars. The anticipated cost of the EPG will be greater than the
battery/inverter units, but will be still be affordable to the consumer in the
non-specialized retail market. The physical size of the EPG needs to be larger
than the battery/inverter system in order to accommodate the control system, the
electric motor, the alternator and the secondary battery.. With a
battery/inverter only system, once the battery is depleted, the battery needs to
be recharged before it can be used again. While the EPG is designed to recharge
the primary battery when it depletes, so that the length of time that power can
be provided by the EPG may be increased in comparison to existing battery
inverter products, Salamon Group has not yet tested the EPG to determine how
long the EPG can supply power before both the primary and the secondary
batteries become depleted.

The Company intends to focus
primarily on the large indoor market for homes, offices, recreational
vehicles, cottages, small warehouses, storage units, etc. We believe that the
EPG will be readily accepted in the market place because it is portable,
compact, price competitive, and does not require fuelling. Our licensees will be
soliciting some of the big retailers such as Wal-Mart, Zellers, Home Depot,
Sears and Canadian Tire.

Item 3. Controls and procedures

As of September 30, 2006, an evaluation
  was carried out under the supervision and with the participation of the Company’s
  management, including our Chief Executive Officer and our Chief Financial Officer,
  of the effectiveness of the design and operation of our disclosure controls
  and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities
  Exchange Act of 1934). Based upon that evaluation, the Chief Executive Officer
  and the Chief Financial Officer concluded that the design and operation of these
  disclosure controls and procedures were effective.

(a) Evaluation of Disclosure Controls and Procedures. The Company
  carried out an evaluation under the supervision and with the participation of
  the Companys management, including the Companys Chief Executive
  Officer (CEO) and Chief Financial Officer (CFO), of
  the effectiveness of the Companys disclosure controls and procedures.
  Based upon that evaluation, the CEO and CFO concluded that as of September 30,
  2006 our disclosure controls and procedures were effective in timely alerting
  them to the material information relating to the Company (or the Companys
  consolidated subsidiaries) required to be included in the Companys periodic
  filings with the SEC, subject to the various limitations on effectiveness set
  forth below under the heading, LIMITATIONS ON THE EFFECTIVENESS OF INTERNAL
  CONTROLS, such that the information relating to the Company, required
  to be disclosed in SEC reports (i) is recorded, processed, summarized and reported
  within the time periods specified in SEC rules and forms, and (ii) is accumulated
  and communicated to the Companys management, including our CEO and CFO,
  as appropriate to allow timely decisions regarding required disclosure.

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Remediation of Material Weakness in Internal Control

In connection with the December 31, 2006 audit, we determined
  that the Companys policies and procedures did not provide for adequate
  management, oversight, and review of the Companys accounting for the mathematical
  accuracy of our financial statements. These deficiencies resulted in the restatement
  of the Companys consolidated financial statements for the period ended
  September 30, 2006 and the amendment to our Form 10-QSB for the period then
  ended.

The foregoing led our management to conclude that our
disclosure controls and procedures were not effective as of September 30,
2006because of a material weakness in our internal controls over financial
reporting.

In the fourth quarter of 2006, we implemented additional review
procedures to ensure that a complete review is performed on all of our required
filings. Such review will be done by our existing financial reporting personnel.
As such, we believe that the remediation initiative outlined above was
sufficient to eliminate the material weakness in internal control over financial
reporting as discussed above.

(b) Changes in internal control over financial reporting. Other
  than as noted above, there have been no changes in the Companys internal
  control over financial reporting that occurred during the fiscal quarter ended
  September 30, 2006 that has materially affected, or is reasonably likely to
  materially affect, the Companys internal control over financial reporting.

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Table of Contents

LIMITATIONS ON THE EFFECTIVENESS OF INTERNAL CONTROLS

The Companys management, including the CEO and CFO, does not
expect that our disclosure controls and procedures or our internal control over
financial reporting will necessarily prevent all fraud and material error. An
internal control system, no matter how well conceived and operated, can provide
only reasonable, not absolute, assurance that the objectives of the control
system are met. Further, the design of the control system must reflect the fact
that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that
all control issues and instances of fraud, if any, within the Company have been
detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and that breakdowns can occur because of simple
error or mistake. Additionally, controls can be circumvented by the individual
acts of some persons, by collusion of two or more people, or by management
override of the internal control. The design of any system of controls also is
based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its
stated goals under all potential future conditions. Over time, control may
become inadequate because of changes in conditions, and/or the degree of
compliance with the policies or procedures may deteriorate.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The
Company knows of no legal proceedings to which it is a party or to which any of
its property is the subject which are pending, threatened or contemplated or any
unsatisfied judgments against the Company.

Item 2. Changes in Securities

None

Item 3. Defaults Upon Senior Securities

None

Item 4. Submission of Matters to a Vote of Security
Holders

No matter was submitted to a vote
of the Companys shareholders, through the solicitation of proxies or otherwise
during the quarterly period ended September 30, 2006.

Item 5. Other Information

None

(a) Market Information.

There has been no established public
  trading market for the Common Stock since the Company's inception on April 27,
  2001. In June, 2006, the Company executed a 211 Filing Agreement with Spartan
  Securities Group Ltd. The Company is awaiting a response from the NASD on the
  trading symbol status. The Companys stock transfer agent is dealing with
  shareholders of the Company on the notification to shareholders of record for
  over 2 years regarding the issuance of their shares as free trading under the
  144k Blanket Release provisions, CUSIP NO:793893 10 8.

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Item 6. Exhibits and Reports on Form 8-K

The following exhibits are filed with the Form 10-QSB/A:

|10.1 | Acknowledgement of Request for Examination dated August
        29, 2006 (1)                                                                                                                  
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                               
|10.2 | 211 Filing Agreement dated June 5, 2006 (1)                                                                                                                                                   
|     |                                                                                                                                                                                               
|10.3 | Resolution Appointing New Directors dated January 15,
        2005 (1)                                                                                                                        
|     |                                                                                                                                                                                               
|31.1 | Certification of Chief Executive
        Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
        Act of 2002.                                               
|     |                                                                                                                                                                                               
|32.1 | Certification of Chief Executive
        Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350,
        as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

In accordance with Section 13 or
15(d) of the Exchange Act, the registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Date: April 17, 2007

Salamon Group, Inc.

|By: | /s/ John E.
      Salamon | 
|--- | --------------------------- | 
|    | John E. Salamon, President  | 

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