ONE Group Hospitality, Inc. - Quarter Report: 2009 June (Form 10-Q)
FORM
10-Q
U.S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the
quarterly period ended June 30, 2009
OR
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the
transition period from ________ to ________
Commission
file number 000-52651
Plastron Acquisition Corp.
II
(Exact
name of registrant as specified in its charter)
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Delaware
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14-1961545
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(State
or other jurisdiction
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(I.R.S.
Employer Identification Number)
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of
incorporation or organization)
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c/o Michael Rapp, 712 Fifth
Avenue, 22nd Floor New York, NY
10019
(Address
of principal executive offices)
(212)
277-5301
(Registrant’s
telephone number, including area code)
No
change
(Former
name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes x No ¨.
Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, 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 ¨ No ¨
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 definitions of “large
accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule
12b-2 of the Exchange Act. (Check one):
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Large
accelerated filer ¨
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Accelerated
filer
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¨
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Non-accelerated
filer o
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Smaller
reporting company
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x.
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Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes x No ¨.
APPLICABLE
ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
THE
PRECEDING FIVE YEARS:
Indicate by check mark whether the
registrant has filed all documents and reports required to be filed by Sections
12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court. Yes o No o.
APPLICABLE
ONLY TO CORPORATE ISSUERS:
Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date: 2,061,856 shares of common stock,
par value $.0001 per share, outstanding as of September 21, 2009.
PLASTRON
ACQUISITION CORP. II
-
INDEX -
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Page
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PART
I – FINANCIAL INFORMATION:
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Item
1.
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Financial
Statements:
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Balance
Sheets as of June 30, 2009 (unaudited) and December 31, 2008
(audited)
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1
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Statements
of Operations for the Three and Six Months Ended June 30, 2009
and
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2
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June
30, 2008 (unaudited) and for the Cumulative Period from
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January
24, 2006 (Inception) to June 30, 2009 (unaudited)
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Statement
of Stockholders’ Deficit for the Cumulative Period from
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3
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January
24, 2006 (Inception) to June 30, 2009 (unaudited)
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Statements
of Cash Flows for the Six Months Ended June 30, 2009 and
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4
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June
30, 2008 (unaudited) and for the Cumulative Period from January 24,
2006
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(Inception)
to June 30, 2009 (unaudited)
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Notes
to Financial Statements (unaudited)
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5
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Item
2.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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9
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Item
3.
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Quantitative
and Qualitative Disclosures About Market Risk
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11
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Item
4T.
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Controls
and Procedures
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12
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PART II – OTHER
INFORMATION:
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Item
1.
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Legal
Proceedings
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12
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Item
1A.
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Risk
Factors
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12
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Item
2.
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Unregistered
Sales of Equity Securities and Use of Proceeds
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12
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Item
3.
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Defaults
Upon Senior Securities
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13
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Item
4.
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Submission
of Matters to a Vote of Security Holders
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13
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Item
5.
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Other
Information
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13
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Item
6.
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Exhibits
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13
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Signatures
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14
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PART I – FINANCIAL
INFORMATION
Item
1. Financial Statements.
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
BALANCE
SHEETS
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As of
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As of
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|||||||
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June 30,
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December 31,
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2009
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2008
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(Unaudited)
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(Audited)
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ASSETS
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CURRENT
ASSETS:
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Cash
and cash equivalents
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$ | 239 | $ | 582 | ||||
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Total
current assets
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239 | 582 | ||||||
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TOTAL
ASSETS
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$ | 239 | $ | 582 | ||||
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LIABILITIES
AND STOCKHOLDERS’ DEFICIT
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CURRENT
LIABILITIES:
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Accounts
payable
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$ | - | $ | 854 | ||||
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Accrued
interest - related party
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3,040 | 2,036 | ||||||
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Note
payable - related party
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37,000 | 22,500 | ||||||
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Total
current liabilities
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40,040 | 25,390 | ||||||
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TOTAL
LIABILITIES
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40,040 | 25,390 | ||||||
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STOCKHOLDERS’
DEFICIT:
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Preferred
stock, $.0001 par value; 10,000,000 shares authorized; 0 issued and
outstanding
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- | - | ||||||
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Common
stock, $.0001 par value; 75,000,000 shares authorized; 2,061,856 shares
issued and outstanding
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206 | 200 | ||||||
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Additional
paid-in capital
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30,722 | 29,800 | ||||||
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Deficit
accumulated during the development stage
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(70,729 | ) | (54,808 | ) | ||||
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TOTAL
STOCKHOLDERS’ DEFICIT
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(39,801 | ) | (24,808 | ) | ||||
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TOTAL
LIABILITIES AND STOCKHOLDERS’ DEFICIT
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$ | 239 | $ | 582 | ||||
The
accompanying notes are an integral part of the financial
statements.
1
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
STATEMENTS OF
OPERATIONS
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April 1, 2009
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April 1, 2008
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January 1, 2009
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January 1, 2008
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Inception
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||||||||||||||||
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to
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to
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to
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to
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(January 24, 2006) to
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June 30, 2009
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June 30, 2008
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June 30, 2009
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June 30, 2008
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June 30, 2009
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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REVENUE
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$ | - | $ | - | $ | - | $ | - | $ | - | ||||||||||
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OPERATING
EXPENSES:
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General
and administrative expenses
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8,087 | 2,589 | 14,917 | 5,320 | 67,688 | |||||||||||||||
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LOSS
FROM OPERATIONS
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(8,087 | ) | (2,589 | ) | (14,917 | ) | (5,320 | ) | (67,688 | ) | ||||||||||
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OTHER
(EXPENSE)
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Interest
expense - related party
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(630 | ) | (297 | ) | (1,004 | ) | (422 | ) | (3,041 | ) | ||||||||||
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Total
other (expense)
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(630 | ) | (297 | ) | (1,004 | ) | (422 | ) | (3,041 | ) | ||||||||||
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NET
LOSS
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$ | (8,717 | ) | $ | (2,886 | ) | $ | (15,921 | ) | $ | (5,742 | ) | $ | (70,729 | ) | |||||
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BASIC
NET LOSS PER SHARE
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$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | $ | (0.00 | ) | ||||||||
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WEIGHTED
AVERAGE NUMBER OF COMMON SHARES OUTSTANDING, BASIC
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2,031,948 | 2,000,000 | 2,016,404 | 2,000,000 | ||||||||||||||||
The
accompanying notes are an integral part of the financial
statements.
2
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
STATEMENT OF STOCKHOLDERS’
DEFICIT
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Additional
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Deficit Accumulated
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Total
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Preferred
Stock
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Common
Stock
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Paid-in
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During the
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Stockholders'
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||||||||||||||||||||||||
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Shares
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Amount
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Shares
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Amount
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Capital
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Development Stage
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Deficit
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BALANCE
AT JANUARY 24, 2006, (INCEPTION)
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- | $ | - | - | $ | - | $ | - | $ | - | $ | - | ||||||||||||||||
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Issuance
of common stock for cash at $.015 per share
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- | - | 2,000,000 | 200 | 29,800 | - | 30,000 | |||||||||||||||||||||
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Net
loss
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- | - | - | - | - | (12,951 | ) | (12,951 | ) | |||||||||||||||||||
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BALANCE
AT DECEMBER 31, 2006
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- | - | 2,000,000 | 200 | 29,800 | (12,951 | ) | 17,049 | ||||||||||||||||||||
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Net
loss
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- | - | - | - | - | (28,656 | ) | (28,656 | ) | |||||||||||||||||||
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BALANCE
AT DECEMBER 31, 2007
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- | - | 2,000,000 | 200 | 29,800 | (41,607 | ) | (11,607 | ) | |||||||||||||||||||
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Net
loss
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- | - | - | - | - | (13,201 | ) | (13,201 | ) | |||||||||||||||||||
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BALANCE
AT DECEMBER 31, 2008
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- | - | 2,000,000 | 200 | 29,800 | (54,808 | ) | (24,808 | ) | |||||||||||||||||||
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Issuance
of common stock for cash at $.015 per share
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- | - | 61,856 | 6 | 922 | - | 928 | |||||||||||||||||||||
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Net
loss
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- | - | - | - | - | (15,921 | ) | (15,921 | ) | |||||||||||||||||||
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BALANCE
AT JUNE 30, 2009 (unaudited)
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- | $ | - | 2,061,856 | $ | 206 | $ | 30,722 | $ | (70,729 | ) | $ | (39,801 | ) | ||||||||||||||
The accompanying notes are an
integral part of the financial statements.
3
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
STATEMENTS OF CASH
FLOWS
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January 1, 2009
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January 1, 2008
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Inception
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to
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to
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(January 24, 2006) to
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June 30, 2009
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June 30, 2008
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June 30, 2009
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(Unaudited)
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(Unaudited)
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(Unaudited)
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CASH
FLOWS FROM OPERATING ACTIVITIES:
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Net
loss
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$ | (15,921 | ) | $ | (5,742 | ) | $ | (70,729 | ) | |||
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Changes
in operating assets and liabilities:
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Decrease
in accounts payable
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(854 | ) | - | - | ||||||||
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Increase
in accrued interest - related party
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1,004 | 422 | 3,041 | |||||||||
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Net
cash used in operating activities
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(15,771 | ) | (5,320 | ) | (67,688 | ) | ||||||
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CASH
FLOWS FROM FINANCING ACTIVITIES:
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Proceeds
from issuance of common stock
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928 | - | 30,929 | |||||||||
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Proceeds
from loan - related party
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14,500 | 10,000 | 37,000 | |||||||||
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Net
cash provided by financing activities
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15,428 | 10,000 | 67,929 | |||||||||
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NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
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(343 | ) | 4,680 | 239 | ||||||||
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Cash
and cash equivalents at beginning of period
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582 | 1,844 | - | |||||||||
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CASH
AND CASH EQUIVALENTS AT END OF PERIOD
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$ | 239 | $ | 6,524 | $ | 239 | ||||||
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The
accompanying notes are an integral part of the financial
statements.
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4
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
NOTES TO FINANCIAL
STATEMENTS
(Unaudited)
NOTE 1 - ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES:
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(a)
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Organization
and Business:
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Plastron
Acquisition Corp. II (the “Company”) was incorporated in the state of Delaware
on January 24, 2006 for the purpose of raising capital that is intended to be
used in connection with its business plans which may include a possible merger,
acquisition or other business combination with an operating
business.
The
Company is currently in the development stage as defined in SFAS No. 7. All
activities of the Company to date relate to its organization, initial funding
and share issuances.
Going
Concern
The
accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplate continuation of the
Company as a going concern. The Company has not begun generating
revenue, is considered a development stage company, has experienced recurring
net operating losses, had an accumulated deficit of ($70,729) and had a working
capital deficiency of ($39,801) as of June 30, 2009. These factors raise
substantial doubt about the Company’s ability to continue as a going concern.
Management plans to issue more shares of common stock in order to raise funds.
These 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 result from this uncertainty. Operating
results for the period ended June 30, 2009 are not necessarily indicative of the
results that may be expected for the year ending December 31, 2009
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(b)
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Basis
of Presentation:
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The
accompanying unaudited financial statements have been prepared in accordance
with Securities and Exchange Commission requirements for financial statements.
The financial statements should be read in conjunction with the Form 10-K for
the year ended December 31, 2008 of the Company.
The
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States.
The
financial information is unaudited. In the opinion of management, all
adjustments (which include normal recurring adjustments) necessary to present
fairly the financial position as of June 30, 2009 and the results of operations
and cash flows presented herein have been included in the financial
statements.
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(c)
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Use
of estimates:
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The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the balance sheet and
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
5
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
NOTES TO FINANCIAL
STATEMENTS
(Unaudited)
NOTE 1 - ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (Continued):
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(d)
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Cash
and cash equivalents:
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For
purposes of the statement of cash flows, the Company considers highly liquid
financial instruments purchased with a maturity of three months or less to be
cash equivalents.
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(e)
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Income
taxes:
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The
Company adopted FASB Interpretation No. 48 (“FIN 48”), “Accounting for
Uncertainty in Income Taxes”, which clarifies the accounting for uncertainty in
income taxes recognized in the financial statements in accordance with SFAS No.
109, “Accounting for Income Taxes.” The Company utilizes the liability method of
accounting for income taxes. Under the liability method deferred tax assets and
liabilities are determined based on the differences between financial reporting
basis and the tax basis of the assets and liabilities and are measured using
enacted tax rates and laws that will be in effect, when the differences are
expected to reverse. An allowance against deferred tax assets is recognized,
when it is more likely than not, that such tax benefits will not be
realized.
Any
deferred tax benefit is considered immaterial and has been fully offset by a
valuation allowance because at this time the Company believes that it is more
likely than not that the future tax benefit will not be realized as the Company
has no current operations.
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(f)
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Loss
per common share:
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Basic
loss per share is calculated using the weighted-average number of common shares
outstanding during each reporting period. Diluted loss per share includes
potentially dilutive securities such as outstanding options and warrants, using
various methods such as the treasury stock or modified treasury stock method in
the determination of dilutive shares outstanding during each reporting period.
The Company does not have any potentially dilutive instruments.
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(g)
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Fair
value of financial instruments:
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The
carrying value of cash equivalents and accrued expenses approximates fair value
due to the short period of time to maturity.
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(h)
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New
accounting pronouncements:
|
In June
2009, the FASB issued Statement of Financial Accounting Standards No. 165,
“Subsequent Events,” (“SFAS No. 165”). SFAS 165 establishes general standards of
accounting for and disclosure of events that occur after the balance sheet date
but before financial statements are issued or are available to be issued. SFAS
165 applies to both interim financial statements and annual financial
statements. SFAS 165 is effective for interim or annual financial periods ending
after June 15, 2009. SFAS 165 does not have a material impact on our financial
statements.
6
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
NOTES TO FINANCIAL
STATEMENTS
(Unaudited)
In June
2009, the FASB issued Statement of Financial Accounting Standards No. 165,
“Subsequent Events,” (“SFAS No. 165”). SFAS 165 establishes general standards of
accounting for and disclosure of events that occur after the balance sheet date
but before financial statements are issued or are available to be issued. SFAS
165 applies to both interim financial statements and annual financial
statements. SFAS 165 is effective for interim or annual financial periods ending
after June 15, 2009. SFAS 165 does not have a material impact on our financial
statements.
In
June 2009, the FASB issued Statement of Financial Accounting Standards
No. 166, “Accounting for Transfers of Financial Assets, an amendment to
SFAS No. 140,” (“SFAS 166”). SFAS 166 eliminates the concept of a
“qualifying special-purpose entity,” changes the requirements for derecognizing
financial assets, and requires additional disclosures in order to enhance
information reported to users of financial statements by providing greater
transparency about transfers of financial assets, including securitization
transactions, and an entity’s continuing involvement in and exposure to the
risks related to transferred financial assets. SFAS 166 is effective for fiscal
years beginning after November 15, 2009. The Company will adopt
SFAS 166 in fiscal 2010. The Company does not expect that the adoption of
SFAS 166 will have a material impact on the financial statements.
In June
2009, the FASB issued Statement of Financial Accounting Standards No. 167, “Amendments to FASB
Interpretation No. 46(R),” (“SFAS 167”). The amendments include: (1) the
elimination of the exemption for qualifying special purpose entities, (2) a new
approach for determining who should consolidate a variable-interest entity, and
(3) changes to when it is necessary to reassess who should consolidate a
variable-interest entity. SFAS 167 is effective for the first annual reporting
period beginning after November 15, 2009 and for interim periods within that
first annual reporting period. The Company will adopt SFAS 167 in fiscal 2010.
The Company does not expect that the adoption of SFAS 167 will have a material
impact on the financial statements.
In June
2009, the FASB issued Statement of Financial Accounting Standards No. 168,
“The FASB Accounting Standards Codification and the Hierarchy of Generally
Accepted Accounting Principles,” (“SFAS 168”). SFAS 168 replaces FASB Statement
No. 162, “The Hierarchy of Generally Accepted Accounting Principles”, and
establishes the FASB Accounting Standards Codification (“Codification”) as the
source of authoritative accounting principles recognized by the FASB to be
applied by nongovernmental entities in the preparation of financial statements
in conformity with generally accepted accounting principles (“GAAP”). SFAS 168
is effective for interim and annual periods ending after September 15,
2009. The Company will begin to use the new Codification when referring to GAAP
in its annual report on Form 10-K for the fiscal year ending December 31, 2010.
This will not have an impact on the results of the Company.
7
PLASTRON
ACQUISITION CORP. II
(A
Development Stage Company)
NOTES TO FINANCIAL
STATEMENTS
(Unaudited)
NOTE 2 - NOTE PAYABLE – RELATED
PARTY:
On March
9, 2007, the Company entered into a loan agreement with Broadband Capital
Management, LLC (“BCM”), pursuant to which the Company agreed to repay $12,500
on or before the earlier of (i) December 31, 2012 or (ii) the date that the
Company (or a wholly owned subsidiary of the Company) consummates a merger or
similar transaction with an operating business (the “Maturity Date”). BCM had
previously advanced the $12,500 on behalf of the Company. Interest shall accrue
on the outstanding principal balance of this loan on the basis of a 360-day year
daily from January 24, 2006, the effective date of the loan, until paid in full
at the rate of four percent (4%) per annum. Clifford Chapman, our
director, Michael Rapp, our President and director, and Philip Wagenheim, our
Secretary and director, all serve as management of BCM, a registered
broker-dealer.
On April
15, 2008, Michael Rapp, the President and a director of the Company, Philip
Wagenheim, the Secretary and a director of the Company, and Clifford Chapman, a
director of the Company, loaned the Company $5,000, $3,000 and $2,000,
respectively. The Company issued promissory notes (each the “April 15 Note” and
together, the “April 15 Notes”) to Messrs Rapp, Wagenheim
and Chapman, pursuant to which the principal amounts thereunder shall accrue
interest at an annual rate of 8.25%, and such principal and all accrued interest
shall be due and payable on or before the earlier of (i) the fifth anniversary
of the date of the Note or (ii) the date the Company consummates a business
combination with a private company in a reverse merger or reverse takeover
transaction or other transaction after which the company would cease to be a
shell company.
On March
16, 2009, the Company entered into a loan agreement with Broadband Capital
Management, LLC (“BCM”), pursuant to which the Company agreed to repay $14,500
on or before the earlier of (i) March 16, 2014 or (ii) the date that the Company
(or a wholly owned subsidiary of the Company) consummates a merger or similar
transaction with an operating business (the “Maturity
Date”). Interest shall accrue on the outstanding principal balance of
this loan at an annual rate of 8.25%. Clifford Chapman, our director, Michael
Rapp, our President and director, and Philip Wagenheim, our Secretary and
director, all serve as management of BCM, a registered
broker-dealer.
NOTE 3 - STOCKHOLDERS’
DEFICIT:
The
Company is authorized by its Certificate of Incorporation to issue an aggregate
of 85,000,000 shares of capital stock, of which 75,000,000 are shares of common
stock, par value $.0001 per share (the “Common Stock”) and 10,000,000 are shares
of preferred stock, par value $.0001 per share (the “Preferred Stock”). On March
1, 2006, the Company issued 1,000,000, 600,000, and 400,000 shares to Michael
Rapp, Philip Wagenheim, and Clifford Chapman, respectively, for total cash
consideration of $30,000 or $.015 per share. On May 14, 2009, the
Company issued 61,856 shares to Charles Allen, for total cash consideration of
$927.84 or $.015 per share. As of June 30, 2009, 2,061,856 shares of
Common Stock were issued and outstanding.
All
outstanding shares of Common Stock are of the same class and have equal rights
and attributes. The holders of Common Stock are entitled to one vote per share
on all matters submitted to a vote of stockholders of the Company. All
stockholders are entitled to share equally in dividends, if any, as may be
declared from time to time by the Board of Directors out of funds legally
available. In the event of liquidation, the holders of Common Stock are entitled
to share ratably in all assets remaining after payment of all liabilities. The
stockholders do not have cumulative or preemptive rights.
8
Item
2. Management’s Discussion and Analysis of Financial Condition and
Results of Operations.
Forward
Looking Statement Notice
Certain
statements made in this Quarterly Report on Form 10-Q are “forward-looking
statements” (within the meaning of the Private Securities Litigation Reform Act
of 1995) in regard to the plans and objectives of management for future
operations. Such statements involve known and unknown risks, uncertainties and
other factors that may cause actual results, performance or achievements of
Plastron Acquisition Corp. II (“we”, “us”, “our” or the “Company”) to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. The forward-looking
statements included herein are based on current expectations that involve
numerous risks and uncertainties. The Company's plans and objectives are based,
in part, on assumptions involving the continued expansion of business.
Assumptions relating to the foregoing involve judgments with respect to, among
other things, future economic, competitive and market conditions and future
business decisions, all of which are difficult or impossible to predict
accurately and many of which are beyond the control of the Company. Although the
Company believes its assumptions underlying the forward-looking statements are
reasonable, any of the assumptions could prove inaccurate and, therefore, there
can be no assurance the forward-looking statements included in this Quarterly
Report will prove to be accurate. In light of the significant uncertainties
inherent in the forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the Company or
any other person that the objectives and plans of the Company will be
achieved.
Description
of Business
The
Company was incorporated in the State of Delaware on January 24, 2006 and
maintains its principal executive office at c/o Michael Rapp, 712 Fifth Avenue,
22nd
Floor, New York, NY 10019. Since inception, the Company has been engaged in
organizational efforts and obtaining initial financing. The Company
was formed as a vehicle to pursue a business combination through the acquisition
of, or merger with, an operating business. The Company filed a
Registration Statement on Form 10-SB with the U.S. Securities and Exchange
Commission (the “SEC”) on May 15, 2007, and since its effectiveness, the Company
has focused its efforts to identify a possible business
combination.
The
Company, based on proposed business activities, is a “blank check” company. The
SEC defines those companies as "any development stage company that is issuing a
penny stock, within the meaning of Section 3(a)(51) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and that has no specific business
plan or purpose, or has indicated that its business plan is to merge with an
unidentified company or companies." Many states have enacted statutes, rules and
regulations limiting the sale of securities of "blank check" companies in their
respective jurisdictions. The Company is also a “shell company,” defined in Rule
12b-2 under the Exchange Act as a company with no or nominal assets (other than
cash) and no or nominal operations. Management does not intend to undertake any
efforts to cause a market to develop in our securities, either debt or equity,
until we have successfully concluded a business combination. The Company intends
to comply with the periodic reporting requirements of the Exchange Act for so
long as we are subject to those requirements.
The
Company was organized as a vehicle to investigate and, if such investigation
warrants, acquire a target company or business seeking the perceived advantages
of being a publicly held corporation. The Company’s principal business objective
for the next 12 months and beyond such time will be to achieve long-term growth
potential through a combination with an operating business. The Company will not
restrict its potential candidate target companies to any specific business,
industry or geographical location and, thus, may acquire any type of
business.
The Company currently does not engage
in any business activities that provide cash flow. During the next
twelve months we anticipate incurring costs related to:
|
(i)
|
filing
Exchange Act reports, and
|
|
(ii)
|
investigating,
analyzing and consummating an
acquisition.
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9
We believe we will be able to meet
these costs through use of funds in our treasury, through deferral of fees by
certain service providers and additional amounts, as necessary, to be loaned to
or invested in us by our stockholders, management or other
investors.
The Company may consider acquiring a
business which has recently commenced operations, is a developing company in
need of additional funds for expansion into new products or markets, is seeking
to develop a new product or service, or is an established business which may be
experiencing financial or operating difficulties and is in need of additional
capital. In the alternative, a business combination may involve the acquisition
of, or merger with, a company which does not need substantial additional capital
but which desires to establish a public trading market for its shares while
avoiding, among other things, the time delays, significant expense, and loss of
voting control which may occur in a public offering.
Since our Registration Statement on
Form 10-SB went effective, our management has had contact and discussions with
representatives of other entities regarding a business combination with us. Any
target business that is selected may be a financially unstable company or an
entity in its early stages of development or growth, including entities without
established records of sales or earnings. In that event, we will be subject to
numerous risks inherent in the business and operations of financially unstable
and early stage or potential emerging growth companies. In addition, we may
effect a business combination with an entity in an industry characterized by a
high level of risk, and, although our management will endeavor to evaluate the
risks inherent in a particular target business, there can be no assurance that
we will properly ascertain or assess all significant risks.
The Company anticipates that the
selection of a business combination will be complex and extremely risky. Because
of general economic conditions, rapid technological advances being made in some
industries and shortages of available capital, our management believes that
there are numerous firms seeking even the limited additional capital which we
will have and/or the perceived benefits of becoming a publicly traded
corporation. Such perceived benefits of becoming a publicly traded corporation
include, among other things, facilitating or improving the terms on which
additional equity financing may be obtained, providing liquidity for the
principals of and investors in a business, creating a means for providing
incentive stock options or similar benefits to key employees, and offering
greater flexibility in structuring acquisitions, joint ventures and the like
through the issuance of stock. Potentially available business combinations may
occur in many different industries and at various stages of development, all of
which will make the task of comparative investigation and analysis of such
business opportunities extremely difficult and complex.
Liquidity
and Capital Resources
As of June 30, 2009, the Company had
assets equal to $239, comprised exclusively of cash and cash equivalents. This
compares with assets of $582, comprised exclusively of cash and cash
equivalents, as of December 31, 2008. The Company’s current liabilities as of
June 30, 2009 totaled $40,040, comprised exclusively of notes payable and
accrued interest. This compares to the Company’s current liabilities
as of December 31, 2008 of $25,390, comprised exclusively of accounts payable,
notes payable and accrued interest. The Company
can provide no assurance that it can continue to satisfy its cash requirements
for at least the next twelve months.
The following is a summary of the
Company's cash flows provided by (used in) operating, investing, and financing
activities for the six months ended June 30, 2009 and June 30, 2008 and for the
cumulative period from January 24, 2006 (Inception) to June 30,
2009:
10
|
Six Months
Ended
June 30, 2009
|
Six Months
Ended
June 30, 2008
|
For the Cumulative
Period from
January 24, 2006
(Inception) to
June 30, 2009
|
||||||||||
|
Net
cash used in operating activities
|
$ | (15,771 | ) | $ | (5,320 | ) | $ | (67,688 | ) | |||
|
Net
cash used in investing activities
|
- | - | - | |||||||||
|
Net
cash provided by financing activities
|
15,428 | 10,000 | 67,929 | |||||||||
|
Net
increase in cash and cash equivalents
|
$ | (343 | ) | $ | 4,680 | $ | 239 | |||||
The
Company has nominal assets and has generated no revenues since inception. The
Company is also dependent upon the receipt of capital investment or other
financing to fund its ongoing operations and to execute its business plan of
seeking a combination with a private operating company. In addition, the Company
is dependent upon certain related parties to provide continued funding and
capital resources. If continued funding and capital resources are unavailable at
reasonable terms, the Company may not be able to implement its plan of
operations.
Results
of Operations
The
Company has not conducted any active operations since inception, except for its
efforts to locate suitable acquisition candidates. No revenue has been
generated by the Company from January 24, 2006 (Inception) to June 30,
2009. It is unlikely the Company will have any revenues unless it is
able to effect an acquisition or merger with an operating company, of which
there can be no assurance. It is management's assertion that these
circumstances may hinder the Company's ability to continue as a going
concern. The Company’s plan of operation for the next twelve months shall
be to continue its efforts to locate suitable acquisition
candidates.
For the
three and six months ended June 30, 2009, the Company had a net loss of $8,717
and $15,921, respectively, consisting of legal, accounting, audit and other
professional service fees incurred in relation to the filing of the Company’s
Quarterly Report on Form 10-Q for the period ending March 31, 2009 and Annual
Report on Form 10-K for the year ended December 31, 2008. This
compares with a net loss of $2,886 and $5,742 for the three and six months ended
June 30 , 2008, respectively, consisting of legal, accounting, audit and other
professional service fees incurred.
For the
cumulative period from January 24, 2006 (Inception) to June 30, 2009, the
Company had a net loss of $(70,729), consisting of legal, accounting, audit and
other professional service fees incurred in relation to the formation of the
Company, the filing of the Company’s Registration Statement on Form 10-SB in
November of 2005, the filing of the Company’s Quarterly Reports on Form 10-QSB
and Form 10-Q and the filing of the Company’s Annual Reports on Form 10-KSB and
Form 10-K.
Off-Balance Sheet
Arrangements
The Company does not have any off-balance sheet arrangements that
have or are reasonably likely to have a current or future effect on the
Company’s financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that is material to investors.
Contractual
Obligations
As a “smaller reporting company” as
defined by Item 10 of Regulation S-K, the Company is not required to provide
this information.
Item
3. Quantitative and Qualitative Disclosures About Market
Risk.
As a “smaller reporting company” as
defined by Item 10 of Regulation S-K, the Company is not required to provide
this information.
11
Item
4. Controls and Procedures.
Evaluation
of Disclosure Controls and Procedures
We maintain disclosure controls and
procedures that are designed to ensure that information required to be disclosed
in our reports filed pursuant to the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules,
regulations and related forms, and that such information is accumulated and
communicated to our principal executive officer and principal financial officer,
as appropriate, to allow timely decisions regarding required
disclosure.
As of June 30, 2009, we carried out an
evaluation, under the supervision and with the participation of our principal
executive officer and our principal financial officer of the effectiveness of
the design and operation of our disclosure controls and procedures. Based on
this evaluation, our principal executive officer and our principal financial
officer concluded that our disclosure controls and procedures were effective as
of the end of the period covered by this report.
Changes
in Internal Controls
There have been no changes in our
internal controls over financial reporting during the quarter ended June 30,
2009 that have materially affected or are reasonably likely to materially affect
our internal controls.
PART II — OTHER
INFORMATION
Item
1. Legal Proceedings.
To the best knowledge of our officers
and directors, the Company is not a party to any legal proceeding or
litigation.
Item
1A. Risk Factors.
As a “smaller reporting company” as
defined by Item 10 of Regulation S-K, the Company is not required to provide
this information.
Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds.
On May 14, 2009, the Company sold
61,856 shares of Common Stock to Charles Allen. The Company sold such
shares of Common Stock to Mr. Allen, for an aggregate purchase price equal to
$927.84 and pursuant to the terms and conditions contained in that certain
common stock purchase agreement by and between the Company and Mr. Allen, a copy
of which is attached as Exhibit 10.2 to the
Form 8-K filed by the Company in May of 2009. The Company sold these
shares of Common Stock to Mr. Allen under the exemption from registration
provided by Section 4(2) of the Securities Act of 1933, as amended (the
“Securities Act”) and Regulation D promulgated thereunder. As of the
date hereof, the Company has 2,061,856 shares of Common Stock issued and
outstanding.
Mr. Allen
represented in writing that he acquired the shares for his own account. A legend
was placed on the stock certificates stating that the securities have not been
registered under the Securities Act and cannot be sold or otherwise transferred
without an effective registration or an exemption therefrom, but may not be sold
pursuant to the exemptions provided by Section 4(1) of the Securities Act under
the Securities Act, in accordance with the letter from Richard K. Wulff, Chief
of the Office of Small Business Policy of the Securities and Exchange
Commission’s Division of Corporation Finance, to Ken Worm of NASD Regulation,
Inc., dated January 21, 2000.
12
Item 3. Defaults Upon
Senior Securities.
None.
Item 4. Submission of
Matters to a Vote of Security Holders.
None.
Item 5. Other
Information.
None.
Item
6. Exhibits.
(a)
Exhibits required by Item 601 of Regulation S-K.
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Exhibit
|
Description
|
||
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*3.1
|
Certificate
of Incorporation, as filed with the Delaware Secretary of State on January
24, 2006.
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|||
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*3.2
|
By-Laws.
|
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31.1
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Certification
of the Company’s Principal Executive Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly
Report on Form 10-Q for the quarter ended June 30,
2009.
|
||
|
31.2
|
Certification
of the Company’s Principal Financial Officer pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly
Report on Form 10-Q for the quarter ended June 30,
2009.
|
||
|
32.1
|
Certification
of the Company’s 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 the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
||
|
*
|
Filed
as an exhibit to the Company’s Registration Statement on Form 10-SB, as
filed with the Securities and Exchange Commission on May 15, 2007 and
incorporated herein by this
reference.
|
||
13
SIGNATURES
Pursuant to the requirements 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.
|
Dated:
September 21, 2009
|
PLASTRON ACQUISITION CORP. II | |
|
|
By:
|
/s/ Michael Rapp
|
|
Michael
Rapp
|
||
|
President
and Director
|
||
|
Principal
Executive Officer
|
||
|
Principal
Financial
Officer
|
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14