UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-K/A

þ		Annual Report under Section 13 or 15(d) of the Securities Exchange Act of 1934

o		Transitional Report under Section 13 or 15(d) of the Securities Exchange Act of 1934

000-52973
Commission file number

 

Stalar 3, Inc.

Delaware		26-1402659
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
11755 Wilshire Blvd., Suite 2000
Los Angeles, CA		90025
(Address of principal executive offices)		(Zip Code)

Issuer’s telephone number: (310) 883-1300

Securities registered under Section 12(b) of the Act: None

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

Common Stock, $0.0001 Par Value
(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in rule 405 of the Securities Act. YES o NO þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. o

Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES þ NO o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES o NO þ

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this form 10-K or any amendment to this Form 10-K. þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company þ

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

State issuer’s revenues for its most recent fiscal year. The Company had no revenues during its fiscal year ending September 30, 2010.

As of December 17, 2010, 2,022,500 shares of the Registrant’s Common Stock and no shares of the Registrant’s Preferred Stock were issued and outstanding.

 

 

EXPLANATORY NOTE

Stalar 3, Inc. (the “Company”) is filing this Amendment No. 2 on Form 10-K/A (this “Amendment”) with the Securities and Exchange Commission (the “SEC”) to amend its Annual Report on Form 10-K for the fiscal year ended September 30, 2010 as filed with the SEC on December 17, 2010 (the “Original Report”). The Company previously filed Amendment No. 1 on Form 10-K/A (“Amendment No. 1”) on February 2, 2011. Amendment No. 1 amended and restated Item 9A(T). Internal Controls and Procedures and the Report of Independent Registered Public Accounting Firm. The amended Report of Independent Registered Public Accounting Firm was presented in Amendment No. 1 and the accompanying financial statements and notes were not included, resulting in Item 8 of Amendment No. 1 being incomplete. This Amendment includes all of the contents of Amendment No. 1 and additionally includes financial statements and schedules in order to include all of the required elements of Item 8. The financial statements and schedules have not been amended, updated or otherwise modified from the Original Report. Currently dated certifications of our principal executive officer and principal financial officer are being filed as exhibits to this Amendment as required by Rule 12b-15 under the Securities Exchange Act of 1934.

Except as described above, the Original Report has not been amended, updated or otherwise modified. The Original Report, as amended by this Amendment, continues to speak as of the date of the Original Report and does not reflect events occurring after the filing of the Original Report or update or otherwise modify any related or other disclosures, including forward-looking statements. Accordingly, this Amendment should be read in conjunction with the Company’s other filings made with the SEC subsequent to the filing of the Original Report.

ITEM 8.		FINANCIAL STATEMENTS.

See the financial statements annexed to this annual report.

ITEM 9A(T).		CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”). Disclosure controls and procedures are those controls and procedures designed to provide reasonable assurance that the information required to be disclosed in our Exchange Act filings is (1) recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission’s rules and forms, and (2) accumulated and communicated to management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our original Form 10-K did not include management’s report on internal controls over financial reporting which is a required item pursuant to Regulation S-K. Because of this omission, our Principal Executive Officer and Principal Financial Officer have reevaluated the effectiveness of the design and operation of our disclosure controls and procedures and concluded that, as of September 30, 2010, our disclosure controls and procedures were not effective in providing a reasonable level of assurance that the information required to be disclosed in our Exchange Act filings is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms. The following material weakness in our disclosure controls and procedures as of September 30, 2010 was identified:

•

As a shell company with no operations or investments, we do not have any full-time employees. Our single officer devoted time to our affairs on an “as needed” basis. As a result, our ability to coordinate, review timely and file financial reports may not have been adequate.

A material weakness is a control deficiency, or combination of control deficiencies, that results in a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements would not be prevented or detected on a timely basis by the Company’s internal controls.

Subsequent to period end, a number of actions have been undertaken to remediate the material weakness noted above. In connection with the acquisition of Abraxis BioScience, Inc. (“Abraxis”) by Celgene Corporation (“Celgene”), we have appointed additional officers and directors, increasing the number of officers from one single individual who served as both the single officer and director to four officers consisting of a President, Chief Financial Officer, Treasurer and a Vice President-Tax. These four officers also serve as directors. Also in connection with the acquisition of Abraxis by Celgene, our public filings are now subject to review by the staff of Celgene. In addition, the Company may file a Form 15 to deregister our securities with the SEC and terminate future SEC reporting obligations.

Management’s Report on Internal Control Over Financial Reporting.

Our Management, including our Principal Executive Officer and our Principal Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act. Those rules define internal control over financial reporting as a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that out receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisitions, use or disposition of our assets that could have a material effect on our financial statements.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as of September 30, 2010. In making this assessment, our management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our assessment included consideration of the material weakness identified in the disclosure controls above and we concluded that the weakness identified above did not impact reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles when also considering our limited size and complexity. Based on our assessment, we believe that, as of September 30, 2010, our internal control over financial reporting is effective based on those criteria.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this annual report.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended September 30, 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART IV

ITEM 15.		EXHIBITS, FINANCIALS STATEMENTS, FINANCIAL STATEMENT SCHEDULES.

The following documents are filed as part of this amended Annual Report on Form 10-K:

Financial Statements

Title of Document		Page
Report of Independent Registered Public Accounting Firm			F-2
Balance Sheets			F-3
Statements of Operations			F-4
Statements of Cash Flows			F-5
Statement of Changes in Stockholder’s Deficit			F-6
Notes to Financial Statements		F-7 to F-9

Financial Statement Schedules

No financial statement schedules are required to be presented.

Exhibits

Exhibit
Number				Title of Document
	3.1			Articles of Incorporation (1)
	3.1	(i)		Certificate of Correction to Certificate of Incorporation (1)
	3.2			Bylaws (1)
	14.1			Code of Ethics (2)
	23.1			Consent of MSCM LLP (3)
	31.1			Certification of principal executive officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	31.2			Certification of principal financial officer pursuant to Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
	32.1			Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
	32.2			Certification of principal financial officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		STALAR 3, INC.
Dated: February 8, 2011		By		/s/ Perry Karsen   Perry Karsen, President
				and Director

STALAR 3, INC.
(A Development Stage Company)
INDEX TO FINANCIAL STATEMENTS
PERIOD FROM NOVEMBER 13, 2007 (Inception) TO SEPTEMBER 30, 2010

		Page
		No.
FINANCIAL STATEMENTS
Report of Independent Registered Public Accounting Firm			F-2
Balance Sheets			F-3
Statements of Operations			F-4
Statements of Cash Flows			F-5
Statement of Changes in Stockholder’s Deficit			F-6
Notes to Financial Statements		F-7 to F-9

		701 Evans Avenue		telephone:		(416) 626-6000
		8th Floor		facsimile:		(416) 626-8650
		Toronto, Ontario Canada		email:		info@mscm.ca
		M9C 1A3		website:		www.mscm.ca

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
Stalar 3, Inc. (A Development Stage Company)

We have audited the accompanying balance sheets of Stalar 3, Inc. as of September 30, 2010 and 2009 and the related statements of operations, changes in stockholders’ deficit and cash flows for the years then ended and for the period from November 13, 2007 (Inception) to September 30, 2010. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Stalar 3, Inc. as of September 30, 2010 and 2009, and the results of its operations and its cash flows for the years then ended and for the period from November 13, 2007 (Inception) to September 30, 2010 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note A to the financial statements, the Company has never generated revenue and is unlikely to generate earnings in the immediate or foreseeable future. These conditions raise substantial doubt as to the ability of the Company to continue as a going concern. Managements’ plans in regards to these matters are described in Note A. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Signed: /s/ MSCM LLP

Toronto, Ontario

December 13, 2010

STALAR 3, INC.
(A Development Stage Company)

BALANCE SHEETS

		2010				2009
ASSETS
Current assets
Cash		$	—			$	89
LIABILITIES AND STOCKHOLDER’S DEFICIT
Current liabilities
Accounts payable and accrued expenses		$	5,000			$	10,458
Due to Parent			16,423				—
Loan payable — Officer			—				21,803
Total current liabilities			21,423				32,261
Stockholder’s deficit
Preferred stock — $0.0001 par value; 25,000,000 shares authorized; none issued or outstanding			—				—
Common stock — $0.0001 par value; 75,000,000 shares authorized; 2,022,500 issued and outstanding			202				202
Additional paid-in capital			24,659				898
Deficit accumulated during the development stage			(46,284	)			(33,272	)
Total stockholder’s deficit			(21,423	)			(32,172	)
		$	—			$	89

The accompanying notes are an integral part of these financial statements.

STALAR 3, INC.
(A Development Stage Company)

STATEMENTS OF OPERATIONS

										November 13, 2007
		Year Ended				Year Ended				(Inception) to
		September 30, 2010				September 30, 2009				September 30, 2010
Revenues		$	—			$	—			$	—
General and administrative expenses
Professional fees			9,790				19,725				35,784
Organization costs			—				—				5,708
Interest expense			183				750				933
Sundry			3,039				362				3,859
			13,012				20,837				46,284
Net loss		$	(13,012	)		$	(20,837	)		$	(46,284	)
Loss per common share:
basic and diluted		$	(0.01	)		$	(0.01	)
Weighted average number of common shares outstanding, basic and diluted			2,022,500				2,015,904

The accompanying notes are an integral part of these financial statements.

STALAR 3, INC.
(A Development Stage Company)

STATEMENTS OF CASH FLOWS

										November 13, 2007
		Year Ended				Year Ended				(Inception) to
		September 30, 2010				September 30, 2009				September 30, 2010
Cash flows from operating activities:
Net loss		$	(13,012	)		$	(20,837	)		$	(46,284	)
(Decrease) increase in cash flows from operating activities resulting from changes in:
Accounts payable and accrued expenses			(4,525	)			8,589				5,933
Net cash used in operating activities			(17,537	)			(12,248	)			(40,351	)
Cash flows from financing activities:
Due to Parent			16,423				—				16,423
Loans payable — Officer			1,025				10,893				22,828
Proceeds from issuance of common stock			—				900				1,100
Net cash provided by financing activities			17,448				11,793				40,351
Net decrease in cash			(89	)			(455	)			—
Cash, beginning of period			89				544				—
Cash, end of period		$	—			$	89			$	—
Supplemental cash flow information:
Non-cash investing and financing activities Officer’s loan contributed to capital		$	23,761			$	—			$	23,761

The accompanying notes are an integral part of these financial statements.

STALAR 3, INC.
(A Development Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDER’S DEFICIT

														Deficit
														Accumulated
										Additional				During
										Paid-in				Development
		Shares				Amount				Capital				Stage				Total
Shares issued at inception, November 13, 2007			—			$	—			$	—			$	—			$	—
Shares issued for cash, at par $.0001			2,000,000				200				—				—				200
Net loss for the period			—				—				—				(12,435	)			(12,435	)
Balance, September 30, 2008			2,000,000				200				—				(12,435	)			(12,235	)
Shares issued for cash, at $.04 per share			22,500				2				898				—				900
Net loss for the year			—				—				—				(20,837	)			(20,837	)
Balance, September 30, 2009			2,022,500			$	202			$	898			$	(33,272	)		$	(32,172	)
Officer’s loan contributed to capital			—				—				23,761				—				23,761
Net loss for the year			—				—				—				(13,012	)			(13,012	)
Balance, September 30, 2010			2,022,500			$	202			$	24,659			$	(46,284	)		$	(21,423	)

The accompanying notes are an integral part of these financial statements.

STALAR 3, INC.
(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

NOTE A — NATURE OF BUSINESS AND BASIS OF PRESENTATION

Stalar 3, Inc. (“the Company”) was incorporated in the State of Delaware on November 13, 2007. The Company, which is in the development stage, is a “shell company” because it has no or nominal assets, other than cash, and no or nominal operations. The Company was formed to pursue a business combination with an operating private company, foreign or domestic, seeking to become a reporting, “public” company. No assurances can be given that the Company will be successful in locating or negotiating with any target company. The Company has been engaged in organizational efforts, obtaining initial financing and has commenced negotiations with various operating entities; however, has not entered into any letter of intent to date.

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of the Company as a going concern. The Company, however, has minimal assets and working capital and lacks a sufficient source of revenues, which raises substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern and to realize its assets and to discharge its liabilities is dependent upon the Company’s management securing a business combination. Management intends to fund working capital requirements for the foreseeable future and believes that the current business plan if successfully implemented may provide the opportunity for the Company to continue as a going concern. The accompanying statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

NOTE B — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

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

Income Taxes

Income taxes are calculated using the asset and liability method, under which deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is primarily dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. In determining the future tax consequences of events that have been recognized in the Company’s financial statements or tax returns, judgment is required.

NOTE B — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income taxes (continued)

Interest and penalties related to uncertain tax positions will be recognized in the financial statements as a component of the income tax provision. Significant judgment is required to evaluate uncertain tax positions. The Company will evaluate its uncertain tax positions on a quarterly and annual basis. The evaluations are based upon a number of factors, including changes in facts or circumstances, changes in tax law, correspondence with tax authorities during the course of audits and effective settlement of audit issues. Changes in the recognition or measurement of uncertain tax positions could result in material increases or decreases in the Company’s income tax expense in the period in which the change is made.

Loss Per Share

The Company uses SFAS No. 128, “Earnings Per Share”, which was primarily codified into Topic 260 “Earnings Per Share”, for calculating the basic and diluted loss per share. The Company computes basic loss per share by dividing net loss and net loss attributable to common stockholders by the weighted average number of common shares outstanding. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential shares had been issued and if the additional shares were dilutive. Common equivalent shares are excluded from the computation of net loss per share if their effect is anti-dilutive. The Company does not have any common stock equivalents.

Fair Value Measurements

Effective January 1, 2008, the Company adopted Financial Accounting Standards Board (“FASB”) Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements”, which was primarily codified into Topic 820 “Fair Value Measurements and Disclosures”, as amended. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. The standard utilizes a fair value hierarchy which is categorized into three levels based on the inputs to the valuation techniques used to measure fair value. The standard does not require any new fair value measurements, but discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flows) and the cost approach (cost to replace the service capacity of an asset or replacement cost).

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash, accounts payable and accrued expenses, due to parent, and loan payable — officer. The carrying value approximates fair value due to the short maturity of these instruments.

NOTE C — PREFERRED STOCK

The Company’s Certificate of Incorporation authorizes the issuance of up to 25,000,000 shares of preferred stock. As of September 30, 2010 and 2009, there was no preferred stock outstanding. The Board of Directors, without the requirement of shareholder approval, can issue preferred shares with dividend, preferences, liquidation, conversion, voting and other rights which could adversely affect the voting power or other rights of the holders of common stock.

NOTE D — INCOME TAXES

As of September 30, 2010, there were loss carryforwards for Federal income tax purposes of approximately $46,000, available to offset future taxable income. The carryforwards begin to expire in 2028. The Company does not expect to incur a Federal income tax liability in the foreseeable future. As of September 30, 2010 and 2009, the Company had a deferred tax asset amounting to approximately $16,000 and $11,000, respectively. Realization of deferred tax assets is dependent on future earnings, if any, the timing and amount of which is uncertain. Accordingly, the deferred tax asset has been fully offset by a valuation allowance of the same amount. As of September 30, 2010 and 2009, we did not recognize any assets or liabilities relative to uncertain tax positions.

Certain provisions of the tax law may limit net operating loss carryforwards available for use in any given year in the event of a significant change in ownership. See Note G.

NOTE E — RECENTLY ISSUED ACCOUNTING STANDARDS

In December 2007, the FASB issued and, in April 2009, amended a new business combinations standard codified within ASC 805 which establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any noncontrolling interest in the acquiree and the goodwill acquired. The standard also establishes disclosure requirements that will enable users to evaluate the nature and financial effects of the business combination. The intent of the amendment is to address application issues on initial recognition and measurement, subsequent measurement and accounting, and disclosure of assets and liabilities arising from contingencies in a business combination. This standard was effective as of the beginning of an entity’s fiscal year that begins after December 15, 2008, which was our 2010 fiscal year beginning October 1, 2009. Our adoption will apply prospectively to business combinations completed on or after that date.

In December 2007, the FASB issued accounting guidance regarding noncontrolling interests. The guidance establishes accounting and reporting standards for the noncontrolling interest in a subsidiary or affiliate and for the deconsolidation of a subsidiary or affiliate. It clarifies that a noncontrolling interest in a subsidiary or affiliate is an ownership interest in the consolidated entity that should be reported as equity in the consolidated balance sheets and to separately report the amounts attributable to controlling and noncontrolling interests in the consolidated statements of operations and changes in equity for all periods presented. This standard was effective as of the beginning of an entity’s fiscal year beginning after December 15, 2008, which was our 2010 fiscal year beginning October 1, 2009. The adoption did not have a material impact on the Company’s results of operations, financial position or cash flows.

In June 2009, the FASB issued guidance requiring an analysis to determine whether a variable interest gives the entity a controlling financial interest in a variable interest entity. This guidance requires an ongoing reassessment and eliminates the quantitative approach previously required for determining whether an entity is the primary beneficiary. This guidance is effective for fiscal years beginning after November 15, 2009. Accordingly, we will adopt this guidance with our fiscal year beginning October 1, 2010. The Company does not expect the adoption to have a material impact on its results of operations, financial position or cash flows.

In June 2009, the FASB issued new guidance on accounting standards codification and the hierarchy of generally accepted accounting principles. The FASB ACCOUNTING STANDARDS CODIFICATION (TM) (Codification) has become the source of authoritative U.S. generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities. This Statement was effective for financial statements issued for interim and annual periods ending after September 15, 2009.

NOTE F — RELATED PARTY TRANSACTIONS

Due to Parent

The Company has received cash advances from the Parent to help fund the Company’s operations. The unsecured advances are non-interest bearing and are due on demand.

Loan Payable — Officer

The officer had advanced funds to the Company to cover cash requirements. The loan is unsecured and is payable on demand with interest at the prime rate.

Equity Transaction

In November 2007, the Company issued 2,000,000 shares of common stock to the sole officer and director for total proceeds of $200.

NOTE G — EQUITY TRANSACTIONS

In December 2009, all of the Company’s shares were acquired by an unrelated party for cash. Pursuant to certain provisions of the tax law, this event is a significant change in ownership that will limit net operating loss carryforwards available for use in any given year. See Note D.

In January 2009, the Company issued 22,500 shares of common stock to unrelated parties at $.04 per share, for total cash proceeds of $900, pursuant to a Common Stock offering.