U.S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-SB
GENERAL
FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS
ISSUERS
UNDER
SECTION 12(B) OR (G) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission
file number ______
Plastron
Acquisition Corp. II
(Name
of
Small Business Issuer in its charter)
Delaware
|
14-1961545
|
(State
or other jurisdiction of
|
(I.R.S.
employer
|
incorporation
or formation)
|
identification
number)
|
c/o
Clifford Chapman
|
|
712
Fifth Avenue
|
|
New
York, New York
|
10019
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Issuer's
telephone number: (212) 277-5301
facsimile
number: (212) 702-9830
Copies
to:
David
N.
Feldman, Esq.
Feldman
Weinstein & Smith LLP
420
Lexington Avenue, Suite 2620
New
York,
NY 10170
(212)
869-7000
Securities
to be registered under Section 12(b) of the Act: none
Securities
to be registered under Section 12(g) of the Exchange Act:
Title
of each class
|
|
Name
of Exchange on which to be so
registered
each class is to be registered
|
Common
Stock, $.0001
|
|
N/A
|
ITEM
1.
DESCRIPTION OF BUSINESS.
(a)
Business Development
Plastron
Acquisition Corp. II (“we”, “us”, “our”, the "Company" or the "Registrant") was
incorporated in the State of Delaware on January 24, 2006. 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
and has made no efforts to identify a possible business combination. As a
result, the Company has not conducted negotiations or entered into a letter
of
intent concerning any target business. The business purpose of the Company
is to
seek the acquisition of, or merger with, an existing company. The Company
selected December 31 as its fiscal year end.
(b)
Business of Issuer
The
Company, based on proposed business activities, is a "blank check" company.
The
U.S. Securities and Exchange Commission (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." Under SEC Rule 12b-2 under the Securities Act of 1933, as amended
(the “Securities Act”), the Company also qualifies as a “shell company,” because
it has no or nominal assets (other than cash) and no or nominal operations.
Many
states have enacted statutes, rules and regulations limiting the sale of
securities of "blank check" companies in their respective jurisdictions.
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 a business rather than immediate,
short-term earnings. 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
analysis of new business opportunities will be undertaken by or under the
supervision of the Company’s officers and directors. Further, Clifford Chapman,
our director, Michael Rapp, our President and director, and Philip Wagenheim,
our Secretary and director, all serve as management of Broadband Capital
Management, LLC (“BCM”), a registered broker-dealer, which may act as investment
banker, placement agent or financial consultant to the Company or an acquisition
candidate in connection with a potential business combination transaction.
As an investment bank, BCM regularly conducts business with companies that
may
be potential business combination candidates. However, as of this
date the Company has not entered into any definitive agreement with any party,
nor have there been any specific discussions with any potential business
combination candidate regarding business opportunities for the Company. The
Registrant has unrestricted flexibility in seeking, analyzing and participating
in potential business opportunities. In its efforts to analyze potential
acquisition targets, the Registrant will consider the following kinds of
factors:
(a)
Potential
for growth, indicated by new technology, anticipated market expansion or new
products;
(b) Competitive
position as compared to other firms of similar size and experience within the
industry segment as well as within the industry as a whole;
(c)
Strength
and diversity of management, either in place or scheduled for
recruitment;
(d)
Capital
requirements and anticipated availability of required funds, to be provided
by
the Registrant or from operations, through the sale of additional securities,
through joint ventures or similar arrangements or from other
sources;
(e)
The
cost
of participation by the Registrant as compared to the perceived tangible and
intangible values and potentials;
(f)
The
extent to which the business opportunity can be advanced;
(g)
The
accessibility of required management expertise, personnel, raw materials,
services, professional assistance and other required items; and
(h)
Other
relevant factors.
In
applying the foregoing criteria, no one of which will be controlling, management
will attempt to analyze all factors and circumstances and make a determination
based upon reasonable investigative measures and available data. Potentially
available business opportunities 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. Due to the Registrant's limited capital available for
investigation, the Registrant may not discover or adequately evaluate adverse
facts about the opportunity to be acquired.
FORM
OF
ACQUISITION
The
manner in which the Registrant participates in an opportunity will depend upon
the nature of the opportunity, the respective needs and desires of the
Registrant and the promoters of the opportunity, and the relative negotiating
strength of the Registrant and such promoters.
It
is
likely that the Registrant will acquire its participation in a business
opportunity through the issuance of common stock or other securities of the
Registrant. Although the terms of any such transaction cannot be predicted,
it
should be noted that in certain circumstances the criteria for determining
whether or not an acquisition is a so-called "tax free" reorganization under
Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the "Code"),
depends upon whether the owners of the acquired business own 80% or more of
the
voting stock of the surviving entity. If a transaction were structured to take
advantage of these provisions rather than other "tax free" provisions provided
under the Code, all prior stockholders would in such circumstances retain 20%
or
less of the total issued and outstanding shares of the surviving entity. Under
other circumstances, depending upon the relative negotiating strength of the
parties, prior stockholders may retain substantially less than 20% of the total
issued and outstanding shares of the surviving entity. This could result in
substantial additional dilution to the equity of those who were stockholders
of
the Registrant prior to such reorganization.
The
present stockholders of the Registrant will likely not have control of a
majority of the voting shares of the Registrant following a reorganization
transaction. As part of such a transaction, all or a majority of the
Registrant's directors may resign and new directors may be appointed without
any
vote by stockholders.
In
the
case of an acquisition, the transaction may be accomplished upon the sole
determination of management without any vote or approval by stockholders. In
the
case of a statutory merger or consolidation directly involving the Company,
it
will likely be necessary to call a stockholders' meeting and obtain the approval
of the holders of a majority of the outstanding shares. The necessity to obtain
such stockholder approval may result in delay and additional expense in the
consummation of any proposed transaction and will also give rise to certain
appraisal rights to dissenting stockholders. Most likely, management will seek
to structure any such transaction so as not to require stockholder
approval.
It
is
anticipated that the investigation of specific business opportunities and the
negotiation, drafting and execution of relevant agreements, disclosure documents
and other instruments will require substantial management time and attention
and
substantial cost for accountants, attorneys and others. If a decision is made
not to participate in a specific business opportunity, the costs theretofore
incurred in the related investigation would not be recoverable. Furthermore,
even if an agreement is reached for the participation in a specific business
opportunity, the failure to consummate that transaction may result in the loss
to the Registrant of the related costs incurred.
We
presently have no employees apart from our management. All of our officers
and
directors are engaged in outside business activities and anticipate that they
will devote to our business very limited time until the acquisition of a
successful business opportunity has been identified. We expect no significant
changes in the number of our employees other than such changes, if any, incident
to a business combination.
(c)
Reports to security holders.
(1)
The
Company is not required to deliver an annual report to security holders and
at
this time does not anticipate the distribution of such a report.
(2)
The
Company will file reports with the SEC. The Company will be a reporting company
and will comply with the requirements of the Exchange Act.
(3)
The
public may read and copy any materials the Company files with the SEC in the
SEC's Public Reference Section, Room 1580, 100 F Street N.E., Washington, D.C.
20549. The public may obtain information on the operation of the Public
Reference Section by calling the SEC at 1-800-SEC-0330. Additionally, the SEC
maintains an Internet site that contains reports, proxy and information
statements, and other information regarding issuers that file electronically
with the SEC, which can be found at http://www.sec.gov.
ITEM
2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
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. Our principal business objective for
the
next 12 months and beyond such time will be to achieve long-term growth
potential through a combination with a business rather than immediate,
short-term earnings. The Company will not restrict our potential candidate
target companies to any specific business, industry or geographical location
and, thus, may acquire any type of business.
The
Company does not currently engage in any business activities that provide cash
flow. The costs of investigating and analyzing business combinations for the
next 12 months and beyond such time will be paid with money in our treasury
or
with additional amounts, as necessary, to be loaned to or invested in us by
our
stockholders, management or other investors.
During
the next 12 months we anticipate incurring costs related to:
(i) |
filing
of Exchange Act reports, and
|
(ii) |
costs
relating to consummating an
acquisition.
|
We
believe we will be able to meet these costs through use of funds in our treasury
and additional amounts, as necessary, to be loaned by or invested in us by
our
stockholders, management or other investors.
The
Company may consider 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.
Our
officers and directors have not had any preliminary contact or discussions
with
any representative of any other entity 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.
Our
management anticipates that it will likely be able to effect only one business
combination, due primarily to our limited financing, and the dilution of
interest for present and prospective stockholders, which is likely to occur
as a
result of our management’s plan to offer a controlling interest to a target
business in order to achieve a tax-free reorganization. This lack of
diversification should be considered a substantial risk in investing in us,
because it will not permit us to offset potential losses from one venture
against gains from another.
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.
RISK
FACTORS
An
investment in the Company is highly speculative in nature and involves an
extremely high degree of risk.
There
may be conflicts of interest between our management and the
Company.
Conflicts
of interest create the risk that management may have an incentive to act
adversely to the interests of the Company. A conflict of interest may
arise between our management's personal pecuniary interest and its fiduciary
duty to our stockholders. In addition, our management is currently involved
with
other blank check companies and conflicts in the pursuit of business
combinations with other blank check companies with which they are, and may
in the future be, affiliated with may arise. If we and the other blank check
companies that management is affiliated with desire to take advantage of the
same opportunity, then members of management that are affiliated with both
companies would abstain from voting upon the opportunity. In the event of
identical officers and directors, members of management, such individuals will
arbitrarily determine the company that will be entitled to proceed with the
proposed transaction.
Further,
BCM, a registered broker-dealer, may act as investment banker, placement agent
or financial consultant to the Company or an acquisition candidate in connection
with a potential business combination transaction. Our officers, directors
and stockholders currently manage BCM. We cannot assure you that conflicts
of interest among the Company, BCM and our stockholders will not develop.
Our
business is difficult to evaluate because we have no operating
history.
As
the
Company has no operating history or revenue and only minimal assets, there
is a
risk that we will be unable to consummate a business combination. The Company
has had no recent operating history nor any revenues or earnings from operations
since inception. We have no significant assets or financial resources. We will,
in all likelihood, sustain operating expenses without corresponding revenues,
at
least until the consummation of a business combination. This may result in
our
incurring a net operating loss that will increase continuously until we can
consummate a business combination with a profitable business opportunity. We
cannot assure you that we can identify a suitable business opportunity and
consummate a business combination.
There
is competition for those private companies suitable for a merger transaction
of
the type contemplated by management.
The
Company is in a highly competitive market for a small number of business
opportunities which could reduce the likelihood of consummating a successful
business combination. We are and will continue to be an insignificant
participant in the business of seeking mergers with, joint ventures with and
acquisitions of small private and public entities. A large number of established
and well-financed entities, including small public companies and venture capital
firms, are active in mergers and acquisitions of companies that may be desirable
target candidates for us. Nearly all these entities have significantly greater
financial resources, technical expertise and managerial capabilities than we
do;
consequently, we will be at a competitive disadvantage in identifying possible
business opportunities and successfully completing a business combination.
These
competitive factors may reduce the likelihood of our identifying and
consummating a successful business combination.
We
are a development stage company and our future success is highly dependent
on
the ability of management to locate and attract a suitable
acquisition.
We
were
incorporated in January 2006 and are considered to be in the development stage.
The nature of our operations is highly speculative and there is a consequent
risk of loss of your investment. The success of our plan of operation will
depend to a great extent on the operations, financial condition and management
of the identified business opportunity. While management intends to seek
business combination(s) with entities having established operating histories,
we
cannot assure you that we will be successful in locating candidates meeting
that
criterion. In the event we complete a business combination, the success of
our
operations may be dependent upon management of the successor firm or venture
partner firm and numerous other factors beyond our control.
The
Company has no existing agreement for a business combination or other
transaction.
We
have
no arrangement, agreement or understanding with respect to engaging in a merger
with, joint venture with or acquisition of, a private or public entity. No
assurances can be given that we will successfully identify and evaluate suitable
business opportunities or that we will conclude a business combination.
Management has not identified any particular industry or specific business
within an industry for evaluation. We cannot guarantee that we will be able
to
negotiate a business combination on favorable terms, and there is consequently
a
risk that funds allocated to the purchase of our shares will not be invested
in
a company with active business operations.
Management
intends to devote only a limited amount of time to seeking a target company
which may adversely impact our ability to identify a suitable acquisition
candidate.
While
seeking a business combination, management anticipates devoting very limited
time to the Company's affairs. Our officers have not entered into written
employment agreements with us and are not expected to do so in the foreseeable
future. This limited commitment may adversely impact our ability to identify
and
consummate a successful business combination.
The
time and cost of preparing a private company to become a public reporting
company may preclude us from entering into a merger or acquisition with the
most
attractive private companies.
Target
companies that fail to comply with SEC reporting requirements may delay or
preclude acquisition. Sections 13 and 15(d) of the Exchange Act require
reporting companies to provide certain information about significant
acquisitions, including certified financial statements for the company acquired,
covering one, two, or three years, depending on the relative size of the
acquisition. The time and additional costs that may be incurred by some target
entities to prepare these statements may significantly delay or essentially
preclude consummation of an acquisition. Otherwise suitable acquisition
prospects that do not have or are unable to obtain the required audited
statements may be inappropriate for acquisition so long as the reporting
requirements of the Exchange Act are applicable.
The
Company may be subject to further government regulation which would adversely
affect our operations.
Although
we will be subject to the reporting requirements under the Exchange Act,
management believes we will not be subject to regulation under the Investment
Company Act of 1940, as amended (the “Investment Company Act”), since we will
not be engaged in the business of investing or trading in securities. If we
engage in business combinations which result in our holding passive investment
interests in a number of entities, we could be subject to regulation under
the
Investment Company Act. If so, we would be required to register as an investment
company and could be expected to incur significant registration and compliance
costs. We have obtained no formal determination from the SEC as to our status
under the Investment Company Act and, consequently, violation of the Investment
Company Act could subject us to material adverse consequences.
Any
potential acquisition or merger with a foreign company may subject us to
additional risks.
If
we
enter into a business combination with a foreign company, we will be subject
to
risks inherent in business operations outside of the United States. These risks
include, for example, currency fluctuations, regulatory problems, punitive
tariffs, unstable local tax policies, trade embargoes, risks related to shipment
of raw materials and finished goods across national borders and cultural and
language differences. Foreign economies may differ favorably or unfavorably
from
the United States economy in growth of gross national product, rate of
inflation, market development, rate of savings, and capital investment, resource
self-sufficiency and balance of payments positions, and in other
respects.
There
is currently no trading market for our common stock, and liquidity of shares
of
our common stock is limited.
Our
shares of common stock are not registered under the securities laws of any
state
or other jurisdiction, and accordingly there is no public trading market for
our
common stock. Further, no public trading market is expected to develop in the
foreseeable future unless and until the Company completes a business combination
with an operating business and the Company thereafter files a registration
statement under the Securities Act. Therefore, outstanding shares of our common
stock cannot be offered, sold, pledged or otherwise transferred unless
subsequently registered pursuant to, or exempt from registration under, the
Securities Act and any other applicable federal or state securities laws or
regulations. Shares
of
our common stock cannot be sold under the exemptions from registration provided
by Rule 144 under or Section 4(1) of 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, dated January 21, 2000. This letter provides that
certain private transfers of the shares of common stock also may be prohibited
without registration under federal securities laws. Compliance with the criteria
for securing exemptions under federal securities laws and the securities laws
of
the various states is extremely complex, especially in respect of those
exemptions affording flexibility and the elimination of trading restrictions
in
respect of securities received in exempt transactions and subsequently disposed
of without registration under the Securities Act or state securities laws.
There
are issues impacting liquidity of our securities with respect to the SEC’s
review of a future resale registration statement.
Since
our
shares of common stock issued prior to a business combination or reverse merger
cannot currently, nor will they for a considerable period of time after we
complete a business combination, be available to be offered, sold, pledged
or
otherwise transferred without being registered pursuant to the Securities Act,
we will likely file a resale registration statement on Form SB-2 or Form S-1,
or
some other available form, to register for resale such shares of common stock.
We cannot control this future registration process in all respects as some
matters are outside our control. Even if we are successful in causing the
effectiveness of the resale registration statement, there can be no assurances
that the occurrence of subsequent events may not preclude our ability to
maintain the effectiveness of the registration statement. Any of the foregoing
items could have adverse effects on the liquidity of our shares of common stock.
In
addition, the SEC has recently disclosed that it has developed internal
guidelines concerning the use of a resale registration statement to register
the
securities issued to certain investors in private investment in public equity
(PIPE) transactions, where the issuer has a market capitalization of less than
$75 million and, in general, does not qualify to file a Registration Statement
on Form S-3 to register its securities. The SEC has taken the position that
these smaller issuers may not be able to rely on Rule 415 under the Securities
Act, which generally permits the offer and sale of securities on a continued
or
delayed basis over a period of time, but instead would require that the issuer
offer and sell such securities in a direct or "primary" public offering, at
a
fixed price, if the facts and circumstances are such that the SEC believes
the
investors seeking to have their shares registered are underwriters and/or
affiliates of the issuer. It appears that the SEC in most cases will permit
a
registration for resale of up to one third of the total number of shares of
common stock then currently owned by persons who are not affiliates of such
issuer and, in some cases, a larger percentage depending on the facts and
circumstances. Staff members also have indicated that an issuer in most cases
will have to wait until the later of six months after effectiveness of the
first
registration or such time as substantially all securities registered in the
first registration are sold before filing a subsequent registration on behalf
of
the same investors. Since, following a reverse merger or business combination,
we may have little or no tradable shares of common stock, it is unclear as
to
how many, if any, shares of common stock the SEC will permit us to register
for
resale, but SEC staff members have indicated a willingness to consider a higher
percentage in connection with registrations following reverse mergers with
shell
companies such as the Company. The SEC may require as a condition to the
declaration of effectiveness of a resale registration statement that we reduce
or “cut back” the number of shares of common stock to be registered in such
registration statement. The result of the foregoing is that a stockholder’s
liquidity in our common stock may be adversely affected in the event the SEC
requires a cut back of the securities as a condition to allow the Company to
rely on Rule 415 with respect to a resale registration statement, or, if the
SEC
requires us to file a primary registration statement.
We
have never paid dividends on our common stock.
We
have
never paid dividends on our common stock and do not presently intend to pay
any
dividends in the foreseeable future. We anticipate that any funds available
for
payment of dividends will be re-invested into the Company to further its
business strategy.
The
Company may be subject to certain tax consequences in our business, which may
increase our cost of doing business.
We
may
not be able to structure our acquisition to result in tax-free treatment for
the
companies or their stockholders, which could deter third parties from entering
into certain business combinations with us or result in being taxed on
consideration received in a transaction. Currently, a transaction may be
structured so as to result in tax-free treatment to both companies, as
prescribed by various federal and state tax provisions. We intend to structure
any business combination so as to minimize the federal and state tax
consequences to both us and the target entity; however, we cannot guarantee
that
the business combination will meet the statutory requirements of a tax-free
reorganization or that the parties will obtain the intended tax-free treatment
upon a transfer of stock or assets. A non-qualifying reorganization could result
in the imposition of both federal and state taxes that may have an adverse
effect on both parties to the transaction.
Our
business will have no revenue unless and until we merge with or acquire an
operating business.
We
are a
development stage company and have had no revenue from operations. We may not
realize any revenue unless and until we successfully merge with or acquire
an
operating business.
The
Company intends to issue more shares in a merger or acquisition, which will
result in substantial dilution.
Our
Certificate of Incorporation authorizes the issuance of a maximum of
75,000,000 shares of common stock and a maximum of 10,000,000 shares of
preferred stock. Any merger or acquisition effected by us may result in the
issuance of additional securities without stockholder approval and may result
in
substantial dilution in the percentage of our common stock held by our then
existing stockholders. Moreover, the common stock issued in any such merger
or
acquisition transaction may be valued on an arbitrary or non-arm’s-length basis
by our management, resulting in an additional reduction in the percentage of
common stock held by our then existing stockholders. Our Board
of
Directors has the power to issue any or all of such authorized but unissued
shares without stockholder approval. To the extent that additional shares of
common stock or preferred stock are issued in connection with a business
combination or otherwise, dilution to the interests of our stockholders will
occur and the rights of the holders of common stock might be materially
adversely affected.
Our
principal stockholders may engage in a transaction to cause the Company to
repurchase their shares of common stock.
In
order
to provide an interest in the Company to a third party, our principal
stockholders may choose to cause the Company to sell Company securities to
third
parties, with the proceeds of such sale being utilized by the Company to
repurchase shares of common stock held by the stockholders. As a result of
such
transaction, our management, principal stockholders and Board of Directors
may
change.
The
Company has conducted no market research or identification of business
opportunities, which may affect our ability to identify a business to merge
with
or acquire.
The
Company has neither conducted nor have others made available to us results
of
market research concerning prospective business opportunities. Therefore, we
have no assurances that market demand exists for a merger or acquisition as
contemplated by us. Our management has not identified any specific business
combination or other transactions for formal evaluation by us, such that it
may
be expected that any such target business or transaction will present such
a
level of risk that conventional private or public offerings of securities or
conventional bank financing will not be available. There is no assurance that
we
will be able to acquire a business opportunity on terms favorable to us.
Decisions as to
which
business opportunity to participate in will be unilaterally made by our
management, which may act without the consent, vote or approval of our
stockholders.
Because
we may seek to complete a business combination through a “reverse merger”,
following such a transaction we may not be able to attract the attention of
major brokerage firms.
Additional
risks may exist since we will assist a privately held business to become public
through a “reverse merger.” Securities analysts of major brokerage firms may not
provide coverage of our Company since there is no incentive to brokerage firms
to recommend the purchase of our common stock. No assurance can be given that
brokerage firms will want to conduct any secondary offerings on behalf of our
post-merger company in the future.
We
cannot assure you that following a business combination with an operating
business, our common stock will be listed on NASDAQ or any other securities
exchange.
Following
a business combination, we may seek the listing of our common stock on NASDAQ
or
the American Stock Exchange. However, we cannot assure you that following such
a
transaction, we will be able to meet the initial listing standards of either
of
those or any other stock exchange, or that we will be able to maintain a listing
of our common stock on either of those or any other stock exchange. After
completing a business combination, until our common stock is listed on the
NASDAQ or another stock exchange, we expect that our common stock would be
eligible to trade on the OTC Bulletin Board, another over-the-counter quotation
system, or on the “pink sheets,” where our stockholders may find it more
difficult to dispose of shares or obtain accurate quotations as to the market
value of our common stock. In addition, we would be subject to an SEC rule
that,
if it failed to meet the criteria set forth in such rule, imposes various
practice requirements on broker-dealers who sell securities governed by the
rule
to persons other than established customers and accredited investors.
Consequently, such rule may deter broker-dealers from recommending or selling
our common stock, which may further affect its liquidity. This would also make
it more difficult for us to raise additional capital following a business
combination.
Authorization
of preferred stock.
Our
Certificate of Incorporation authorizes the issuance of up to 10,000,000 shares
of preferred stock with designations, rights and preferences determined from
time to time by its Board of Directors. Accordingly, our Board of Directors
is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting, or other rights which could adversely affect
the voting power or other rights of the holders of the common stock. In the
event of issuance, the preferred stock could be utilized, under certain
circumstances, as a method of discouraging, delaying or preventing a change
in
control of the Company. Although we have no present intention to issue any
shares of its authorized preferred stock, there can be no assurance that the
Company will not do so in the future.
Control
by management.
Management
currently owns approximately 100% of all the issued and outstanding common
stock
of the Company. Consequently, management has the ability to influence control
of
the operations of the Company and, acting together, will
have
the ability to influence or control substantially all matters submitted to
stockholders for approval, including:
· |
Election
of the Board of Directors;
|
· |
Amendment
to the Company’s certificate of incorporation or bylaws;
and
|
· |
Adoption
of measures that could delay or prevent a change in control or impede
a
merger, takeover or other business
combination.
|
These
stockholders will thus have substantial influence over our management and
affairs and other stockholders of the Company possess no practical ability
to
remove management or effect the operations of the business of the Company.
Accordingly, this concentration of ownership by itself may have the effect
of
impeding a merger, consolidation, takeover or other business consolidation, or
discouraging a potential acquirer from making a tender offer for the common
stock.
This
registration statement contains forward-looking statements and information
relating to us, our industry and to other businesses.
These
forward-looking statements are based on the beliefs of our management, as well
as assumptions made by and information currently available to our management.
When used in this registration statement, the words "estimate," "project,"
"believe," "anticipate," "intend," "expect" and similar expressions are intended
to identify forward-looking statements. These statements reflect our current
views with respect to future events and are subject to risks and uncertainties
that may cause our actual results to differ materially from those contemplated
in our forward-looking statements. We caution you not to place undue reliance
on
these forward-looking statements, which speak only as of the date of this
registration statement. We do not undertake any obligation to publicly release
any revisions to these forward-looking statements to reflect events or
circumstances after the date of this registration statement or to reflect the
occurrence of unanticipated events.
ITEM
3.
DESCRIPTION OF PROPERTY.
The
Company neither rents nor owns any properties. The Company utilizes the office
space and equipment of its management at no cost. Management estimates such
amounts to be immaterial. The Company currently has no policy with respect
to
investments or interests in real estate, real estate mortgages or securities
of,
or interests in, persons primarily engaged in real estate
activities.
ITEM
4.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
(a)
Security ownership of certain beneficial owners.
The
following table sets forth, as of May 15, 2007, the number of shares of common
stock owned of record and beneficially by executive officers, directors and
persons who hold 5% or more of the outstanding shares of common stock of the
Company.
Name
and Address
|
|
Amount
and Nature of
Beneficial Ownership
|
|
Percentage
of
Class
|
|
|
|
|
|
|
|
Clifford
Chapman (1)
|
|
|
400,000
|
|
|
20%
|
|
712
Fifth Avenue
|
|
|
|
|
|
|
|
New
York, New York 10019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Michael
Rapp (2)
|
|
|
1,000,000
|
|
|
50%
|
|
712
Fifth Avenue
|
|
|
|
|
|
|
|
New
York, New York 10019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Philip
Wagenheim (3)
|
|
|
600,000
|
|
|
30%
|
|
712
Fifth Avenue
|
|
|
|
|
|
|
|
New
York, New York 10019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All
Officers and
|
|
|
2,000,000
|
|
|
100%
|
|
Directors
as a group
|
|
|
|
|
|
|
|
(3
individuals)
|
|
|
|
|
|
|
|
(1) |
Clifford
Chapman is a director of the
Company.
|
(2) |
Michael
Rapp is President and a director of the
Company.
|
(3) |
Philip
Wagenheim is Secretary and a director of the
Company.
|
ITEM
5.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
A.
Identification of Directors and Executive Officers.
Our
officers and directors and additional information concerning them are as
follows:
Name
|
|
Age
|
|
Position
|
Michael
Rapp
|
|
39
|
|
President
and Director
|
Philip
Wagenheim
|
|
36
|
|
Secretary
and Director
|
Clifford
Chapman
|
|
38
|
|
Director
|
Michael
Rapp
is the
Company’s president and a director. Mr. Rapp has over eighteen years of
experience in the financial industry and is currently the co-founder and
chairman of BCM. BCM is a boutique investment bank and a NASD broker-dealer
focused on financing, strategic advisory services and sales and trading. BCM
has
specialized in advising its clients on accessing the capital markets through
non-traditional methods such as SPACs and reverse mergers. BCM has underwritten
initial public offerings including Services Acquisition Corp. International
which merged with Jamba Juice Inc. (and changed its name to Jamba Inc.),
Endeavor Acquisition Corporation, which has a pending merger with American
Apparel, and Great Wall Acquisition Corporation, which merged with ChinaCast
Communication Holdings Ltd. Prior to co-founding BCM in 2000, Mr. Rapp was
a
managing director and co-founder of Oscar Gruss & Son’s Private Client Group
in 1997. From 1994 through 1997, Mr. Rapp worked at PaineWebber serving as
a
senior vice president of investments. From 1990 -1994, Mr. Rapp worked at
Prudential Securities serving as a senior vice president of investments. Mr.
Rapp also serves as president and a director of Plastron Acquisition Corp.
I,
which is also a blank check, non-trading, publicly-reporting shell company.
Mr.
Rapp received his Bachelor of Arts degree in psychology from the University
of
Michigan-Ann Arbor in 1989.
Philip
Wagenheim
is the
Company’s secretary and a director. Mr. Wagenheim has over fifteen years of
experience in the financial industry and is currently the vice chairman of
BCM.
Prior to co-founding BCM in 2000, Mr. Wagenheim was a managing director and
co-founder of Oscar Gruss & Son’s Private Client Group in 1997. From
1994-1997, Mr. Wagenheim worked at PaineWebber and from 1992-1994, Mr. Wagenheim
worked at Prudential Securities. Mr. Wagenheim also serves as secretary and
a
director of Plastron Acquisition Corp. I, which is also a blank check,
non-trading, publicly-reporting shell company. Mr. Wagenheim received his degree
in Business Administration from the University of Miami in 1992.
Clifford
Chapman,
is a
director of the Company. Mr. Chapman has served as head of investment banking
at
BCM since September 2005 where he is responsible for the banking, structuring,
and due diligence for all of BCM’s transactions. From January 2001 to the
present, Mr. Chapman has been the managing director of Early Stage Associates
LLC, a consulting company focused on helping businesses in capital formation
and
executive management. From January 2001 to the present Mr. Chapman has also
served as the managing director of ChapRoc Capital LLC, a company which invests
in technology and business services companies. From June 2002 until March 2004,
Mr. Chapman served as chief executive officer for Mindshift Technologies Inc.,
a
managed services provider focused on IT outsourcing for small and medium
enterprises. From 1999 through 2000, Mr. Chapman served as the vice president
of
best practices for AppNet, a full-service internet professional services and
managed hosting company, where he led the integration of twelve acquired
companies. AppNet consummated its initial public offering in July 1999 and
was
subsequently acquired by CommerceOne in September 2000. From 1995 to 1998,
Mr.
Chapman acted as chief operating officer of NMP, an internet business consulting
services company that he co-founded and sold to AppNet in October 1998. Prior
to
NMP, Mr. Chapman worked in the commercial practice of Booz Allen & Hamilton
and as a consultant for Andersen Consulting in their Advanced Systems Group.
Mr.
Chapman presently serves as a member of the board of directors of Catuity,
Inc.
(NASDAQ: CTTY). Mr. Chapman presently serves as the sole officer and director
of
International Cellular Accessories (OTCBB: ICLA). Mr. Chapman also serves as
a
director of Plastron Acquisition Corp. I, which is also a blank check,
non-trading, publicly-reporting shell company. Mr. Chapman received a Masters
of
Business Administration with Honors from Columbia Business School and a
Bachelors Degree in Computer Engineering from Lehigh University.
B.
Significant Employees. None.
C.
Family
Relationships. None.
D.
Involvement in Certain Legal Proceedings. There have been no events under any
bankruptcy act, no criminal proceedings and no judgments, injunctions, orders
or
decrees material to the evaluation of the ability and integrity of any director,
executive officer, promoter or control person of Registrant during the past
five
years.
E.
The
Board of Directors acts as the Audit Committee, and the Board has no separate
committees. The Company has no qualified financial expert at this time because
it has not been able to hire a qualified candidate. Further, the Company
believes that it has inadequate financial resources at this time to hire such
an
expert. The Company intends to search for a qualified individual for
hire.
Prior
Blank Check Company Experience
As
indicated below, members of the management also serve as officers and directors
of:
Name
|
|
Filing
Date Registration Statement
|
|
Operating
Status
|
|
SEC
File Number
|
|
Pending
Business Combinations
|
|
Additional
Information
|
Plastron
Acquisition Corp. I
|
|
May
15, 2007
|
|
Pending
effectiveness
|
|
Unknown
(filed today)
|
|
None.
|
|
Mr.
Chapman has been a director since inception. Messrs. Rapp and
Wagenheim
have been officers and directors since inception.
|
|
|
|
|
|
|
|
|
|
|
|
International
Cellular Accessories (“International”)
|
|
March
2, 2005
|
|
Active
|
|
333-123092
|
|
None.
|
|
Mr.
Chapman is the sole officer, director and principal shareholder
of
International.
|
ITEM
6.
EXECUTIVE COMPENSATION.
The
Company’s officers and directors have not received any cash remuneration since
inception. Officers will not receive any remuneration upon completion of the
offering until the consummation of an acquisition. No remuneration of any nature
has been paid for or on account of services rendered by a director in such
capacity. Our officers and directors intend to devote very limited time to
our
affairs.
It
is
possible that, after the Company successfully consummates a business combination
with an unaffiliated entity, that entity may desire to employ or retain one
or a
number of members of our management for the purposes of providing services
to
the surviving entity. However, the Company has adopted a policy whereby the
offer of any post-transaction employment to members of management will not
be a
consideration in our decision whether to undertake any proposed transaction.
No
retirement, pension, profit sharing, stock option or insurance programs or
other
similar programs have been adopted by the Company for the benefit of its
employees.
There
are
no understandings or agreements regarding compensation our management will
receive after a business combination that is required to be included in this
table, or otherwise.
ITEM
7.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
On
March
9, 2007, the Company entered into a loan agreement with the BCM pursuant to
which the Company agreed to repay BCM $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. 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.
Except
as
otherwise indicated herein, there have been no related party transactions,
or
any other transactions or relationships required to be disclosed pursuant to
Item 404 of Regulation S-B.
ITEM
8.
DESCRIPTION OF SECURITIES.
(a)
Common and Preferred Stock.
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”). As of
May 15, 2007, 2,000,000 shares of Common Stock and zero shares of Preferred
Stock were issued and outstanding.
Common
Stock
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.
Preferred
Stock
Our
Certificate of Incorporation authorizes the issuance of up to 10,000,000 shares
of Preferred Stock with designations, rights and preferences determined from
time to time by its Board of Directors. Accordingly, our Board of Directors
is
empowered, without stockholder approval, to issue Preferred Stock with dividend,
liquidation, conversion, voting, or other rights which could adversely affect
the voting power or other rights of the holders of the Common Stock. In the
event of issuance, the Preferred Stock could be utilized, under certain
circumstances, as a method of discouraging, delaying or preventing a change
in
control of the Company. Although we have no present intention to issue any
shares of its authorized Preferred Stock, there can be no assurance that the
Company will not do so in the future.
The
description of certain matters relating to the securities of the Company is
a
summary and is qualified in its entirety by the provisions of the Company’s
Certificate of Incorporation and By-Laws, copies of which have been filed as
exhibits to this Form 10-SB.
(b)
Debt
Securities.
On
March
9, 2007, the Company entered into a loan agreement with BCM, pursuant to which
the Company agreed to repay BCM $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.
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.
(c)
Other
Securities To Be Registered.
None.
PART
II
ITEM
1.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(a)
Market Information.
The
Common Stock is not trading on any stock exchange. The Company is not aware
of
any market activity in its Common Stock since its inception through the date
of
this filing.
(b)
Holders.
As
of May
15, 2007, there were three record holders of 2,000,000 shares of the Common
Stock issued and outstanding.
(c)
Dividends.
The
Registrant has not paid any cash dividends to date and does not anticipate
or
contemplate paying dividends in the foreseeable future. It is the present
intention of management to utilize all available funds for the development
of
the Registrant's business.
ITEM
2.
LEGAL PROCEEDINGS.
Presently,
there are not any material pending legal proceedings to which the Registrant
is
a party or as to which any of its property is subject, and no such proceedings
are known to the Registrant to be threatened or contemplated against
it.
ITEM
3.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.
There
are
not and have not been any disagreements between the Registrant and its
accountants on any matter of accounting principles, practices or financial
statement disclosure.
ITEM
4.
RECENT SALES OF UNREGISTERED SECURITIES.
On
March
1, 2006, the Registrant sold 400,000, 600,000 and 1,000,000 shares of Common
Stock to Clifford Chapman, Philip Wagenheim and Michael Rapp, respectively,
for
aggregate cash consideration of $30,000. Mr. Chapman is a director of the
Registrant and Messrs. Wagenheim and Rapp are officers and directors of the
Registrant. The Registrant sold these shares of Common Stock under the exemption
from registration provided by Section 4(2) of the Securities Act.
No
securities have been issued for services. Neither the Registrant nor any person
acting on its behalf offered or sold the securities by means of any form of
general solicitation or general advertising. No services were performed by
any
purchaser as consideration for the shares issued.
All
purchasers represented in writing that they acquired the securities for their
own accounts. 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 or Rule 144 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.
ITEM
5.
INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145
of the Delaware General Corporation Law provides that a corporation may
indemnify directors and officers as well as other employees and individuals
against expenses including attorneys' fees, judgments, fines and amounts paid
in
settlement in connection with various actions, suits or proceedings, whether
civil, criminal, administrative or investigative other than an action by or
in
the right of the corporation, a derivative action, if they acted in good faith
and in a manner they reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, if they had no reasonable cause to believe their conduct was
unlawful. A similar standard is applicable in the case of derivative actions,
except that indemnification only extends to expenses including attorneys' fees
incurred in connection with the defense or settlement of such actions, and
the
statute requires court approval before there can be any indemnification where
the person seeking indemnification has been found liable to the corporation.
The
statute provides that it is not exclusive of other indemnification that may
be
granted by a corporation's certificate of incorporation, bylaws, agreement,
a
vote of stockholders or disinterested directors or otherwise.
The
Company’s Certificate of Incorporation provides that it will indemnify and hold
harmless, to the fullest extent permitted by Section 145 of the Delaware General
Corporation Law, as amended from time to time, each person that such section
grants us the power to indemnify.
The
Delaware General Corporation Law permits a corporation to provide in its
certificate of incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability for:
· |
any
breach of the director's duty of loyalty to the corporation or its
stockholders;
|
· |
acts
or omissions not in good faith or which involve intentional misconduct
or
a knowing violation of law;
|
· |
payments
of unlawful dividends or unlawful stock repurchases or redemptions;
or
|
· |
any
transaction from which the director derived an improper personal
benefit.
|
The
Company’s Certificate of Incorporation provides that, to the fullest extent
permitted by applicable law, none of our directors will be personally liable
to
us or our stockholders for monetary damages for breach of fiduciary duty as
a
director. Any repeal or modification of this provision will be prospective
only
and will not adversely affect any limitation, right or protection of a director
of our company existing at the time of such repeal or modification.
PART
F/S
Plastron
Acquisition Corp. II
A
Development Stage Company
-
TABLE OF CONTENTS -
|
|
|
Page(s)
|
|
|
|
|
|
|
|
|
Financial
Statements:
|
|
|
|
|
|
|
|
Report
of Independent Registered Public Accounting Firm
|
|
F
-
1
|
|
|
|
|
|
Balance
Sheet as of December 31, 2006
|
|
F
-
2
|
|
|
|
|
|
Statements
of Operations from January 24, 2006 (Inception)
|
|
F
-
3
|
|
to
December 31, 2006
|
|
|
|
|
|
|
|
Statements
of Stockholders’ Equity from January 24, 2006 (Inception)
|
|
F
-
4
|
|
to
December 31, 2006
|
|
|
|
|
|
|
|
Statements
of Cash Flows from January 24, 2006 (Inception)
|
|
F
-
5
|
|
to
December 31, 2006
|
|
|
|
|
|
|
Notes
to Financial Statements
|
|
F
-
6 - F - 9
|
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We
have
audited the accompanying balance sheet of Plastron Acquisition Corp. II as
of
December 31, 2006, and the related statement of operations, stockholders’
equity, and cash flows from inception (January 24, 2006) through December 31,
2006. 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 audit.
We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining,
on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides 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 Plastron Acquisition Corp II.
as of
December 31, 2006, and the results of its operations and cash flows from
inception (January 24, 2006) through December 31, 2006 in conformity with U.S.
generally accepted accounting principles.
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 1 to the financial statements,
the Company has suffered recurring losses from operations, which raise
substantial doubt about its 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 that might result from the outcome
of
this uncertainty.
/s/
De
Joya Griffith & Company, LLC
/s/
De
Joya Griffith & Company, LLC
Henderson,
NV
February
27, 2007
Plastron
Acquisition Corp. II
|
A
Development Stage Company
|
BALANCE
SHEET
|
|
|
As
of
|
|
|
|
December
31,
|
|
|
|
2006
|
|
|
|
(audited)
|
|
ASSETS
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
Cash
and cash equivalents
|
|
$
|
30,000
|
|
Total
current assets
|
|
$
|
30,000
|
|
|
|
|
|
|
TOTAL
ASSETS
|
|
$
|
30,000
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
Note
payable - related party
|
|
|
12,500
|
|
Accrued
interest - related party
|
|
|
451
|
|
Total
current liabilities
|
|
|
12,951
|
|
|
|
|
|
|
LONG
TERM LIABILITIES:
|
|
|
-
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
|
12,951
|
|
|
|
|
|
|
STOCKHOLDERS’
EQUITY:
|
|
|
|
|
Preferred
stock, $.0001 par value; 10,000,000 shares authorized; none issued
and outstanding
|
|
|
-
|
|
Common
stock, $.0001 par value; 75,000,000 shares authorized; 2,000,000
shares issued and outstanding
|
|
|
200
|
|
Additional
paid-in capital
|
|
|
29,800
|
|
Deficit
accumulated during the development stage
|
|
|
(12,951
|
)
|
|
|
|
|
|
TOTAL
STOCKHOLDERS’ EQUITY
|
|
|
17,049
|
|
|
|
|
|
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
$
|
30,000
|
|
The
accompanying notes are an integral part of the financial
statements.
Plastron
Acquisition Corp. II
|
A
Development Stage Company
|
STATEMENTS
OF OPERATIONS
|
|
|
January
24, 2006
|
|
|
|
(Inception)
to
|
|
|
|
December
31, 2006
|
|
|
|
(audited)
|
|
|
|
|
|
REVENUE
|
|
$
|
-
|
|
|
|
|
|
|
OPERATING
EXPENSES:
|
|
|
|
|
General
and administrative expenses
|
|
|
12,500
|
|
|
|
|
|
|
LOSS
FROM OPERATIONS
|
|
|
(12,500
|
)
|
|
|
|
|
|
OTHER
INCOME (EXPENSE)
|
|
|
|
|
Interest
expense - related party
|
|
|
(451
|
)
|
Total
other income (expense)
|
|
|
(451
|
)
|
|
|
|
|
|
NET
LOSS
|
|
|
($12,951
|
)
|
|
|
|
|
|
|
|
|
|
|
BASIC
NET LOSS PER SHARE
|
|
$
|
0.00
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING, BASIC
|
|
|
2,000,000
|
|
The
accompanying notes are an integral part of the financial
statements.
Plastron
Acquisition Corp. II
A
Development Stage Company
STATEMENTS
OF STOCKHOLDERS’ EQUITY
|
|
Preferred
Stock
|
|
Common
Stock
|
|
Additional
Paid-in
|
|
(Deficit)
Accumulated During the Development
|
|
Total
Stockholders
|
|
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Stage
|
|
Equity
|
|
BALANCES
AT JANUARY 24, 2006, (INCEPTION)
|
|
|
-
|
|
$
|
-
|
|
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
Issuance
of common stock for cash
at
$.015 per share
|
|
|
-
|
|
|
-
|
|
|
2,000,000
|
|
$
|
200
|
|
$
|
29,800
|
|
|
-
|
|
$
|
30,000
|
|
Net
income (loss)
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(12,951
|
)
|
|
(12,951
|
)
|
BALANCES
AT DECEMBER 31, 2006
|
|
|
-
|
|
$
|
-
|
|
|
2,000,000
|
|
$
|
200
|
|
$
|
29,800
|
|
|
($12,951
|
)
|
$
|
17,049
|
|
The
accompanying notes are an integral part of the financial
statements.
A
Development Stage Company
STATEMENTS
OF CASH FLOWS
|
|
January
24, 2006
|
|
|
|
(Inception)
to
|
|
|
|
December
31, 2006
|
|
|
|
(audited)
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
Net
loss
|
|
|
($12,951
|
)
|
Adjustments
to reconcile net (loss) to net cash used in
|
|
|
|
|
operating
activities:
|
|
|
|
|
Changes
in operating liabilities:
|
|
|
|
|
Increase
in accrued liabilities
|
|
|
451
|
|
Net
cash used in operating activities
|
|
|
(12,500
|
)
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
Proceeds
from issuance of common stock
|
|
|
30,000
|
|
Proceeds
from loan - related party
|
|
|
12,500
|
|
Net
cash provided by financing activities
|
|
|
42,500
|
|
|
|
|
|
|
NET
INCREASE IN CASH AND CASH EQUIVALENTS
|
|
|
30,000
|
|
|
|
|
|
|
Cash
and cash equivalents at beginning of period
|
|
|
-
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
30,000
|
|
The
accompanying notes are an integral part of the financial
statements.
PLASTRON
ACQUISITION CORP. II
A
Development Stage Company
NOTES
TO FINANCIAL STATEMENTS
NOTE
1 - |
ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
|
|
(a) |
Organization
and Business:
|
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.
|
(b) |
Basis
of
Presentation:
|
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. At the balance sheet date, the Company has a
deficit accumulated during the development stage. These factors indicate
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.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts
and
classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.
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.
|
(d) |
Cash
and Cash
Equivalents:
|
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.
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.
PLASTRON
ACQUISITION CORP. II
A
Development Stage Company
NOTES
TO FINANCIAL STATEMENTS
NOTE
1 - |
ORGANIZATION
AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued):
|
|
(f) |
Loss
per Common
Share:
|
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.
|
(g) |
Fair
Value of Financial
Instruments:
|
The
carrying value of cash equivalents and accrued expenses approximates fair value
due to the short period of time to maturity.
NOTE
2 - |
RECENT
ACCOUNTING PRONOUNCEMENTS:
|
In
December 2004, FASB issued Statement No. 123 (revised 2004), “Share-Based
Payment” (SFAS 123 (revised 2004), effective for public entities that file as
small business issuers as of the beginning of the first interim or annual
reporting period that begins after December 15, 2005. This Statement is a
revision of FASB Statement No. 123, “Accounting for Stock-Based Compensation,”
and supersedes APB Opinion No. 25, “Accounting for Stock Issued to Employees,”
and its related implementation guidance. SFAS 123 (revised 2004) eliminates
the
alternative to use Opinion No. 25’s intrinsic value method of accounting that
was provided in Statement 123 as originally issued. Under Opinion 25, issuing
stock options to employees generally resulted in recognition of no compensation
cost. This Statement requires entities to recognize the cost of employee
services received in exchange for awards of equity instruments based on the
grant-date fair value of those awards (with limited exceptions). Recognition
of
that compensation cost helps users of financial statements to better understand
the economic transactions affecting an entity and to make better resource
allocation decisions. The Company is required to adopt Statement 123 (revised
2004) as of January 1, 2006, and does not expect this statement to have a
material effect on its results of operations.
In
May
2005, FASB issued SFAS No. 154, “Accounting Changes and Error Corrections - a
Replacement of APB Opinion No. 20 (Accounting Changes) and FASB No. 3 (Reporting
Accounting Changes in Interim Financial Statements),” that changes requirements
for the accounting for and reporting of a change in accounting principle. This
Statement requires retrospective application to prior periods’ financial
statements of changes in accounting principle unless it is impracticable to
determine either the period-specific effects or the cumulative effect of the
change. When it is impracticable to determine the period-specific effects of
an
accounting change on one or more individual prior periods presented, this
Statement requires that the new accounting principle be applied to the balances
of assets and liabilities as of the beginning of the earliest period for which
retrospective application is practicable and that a corresponding adjustment
be
made to the opening balance of retained earnings (or other appropriate
components of equity or net assets in the statement of financial position)
for
that period rather than being reported in an income statement. When it is
impracticable to determine the cumulative effect of applying a change in
accounting principle to all prior periods, this Statement requires that the
new
accounting principle be applied as if it were adopted prospectively from the
earliest date practicable.
PLASTRON
ACQUISITION CORP. I
A
Development Stage Company
NOTES
TO FINANCIAL STATEMENTS
NOTE
2 - |
RECENT
ACCOUNTING PRONOUNCEMENTS
(Continued):
|
Statement
154 is effective for accounting changes and error corrections made in fiscal
years beginning after December 15, 2005 (calendar year 2006). Early adoption
is
permitted.
In
September 2006, the FASB issued Statement No. 157, "Fair Value Measurements"
(FAS 157), which defines fair value, establishes a framework for measuring
fair
value, and expands disclosures about fair value measurements. The provisions
of
FAS 157 become effective as of the beginning of our 2009 fiscal year. We are
currently evaluating the impact that FAS 157 will have on our financial
statements.
In
September 2006, the FASB issued Statement No. 158, "Employer's Accounting for
Defined Benefit Pension and Other Postretirement Plans - an amendment of FASB
Statements No. 87, 88, 106, and 132(R)" (FAS 158). FAS 158 requires that
employers recognize the funded status of their defined benefit pension and
other
postretirement plans on the balance sheet and recognize as a component of other
comprehensive income, net of tax, the plan-related gains or losses and prior
service costs or credits that arise during the period but are not recognized
as
components of net periodic benefit cost. We will prospectively adopt FAS 158
on
April 30, 2007. Based on the funded status of our plans as of the date of our
most recent actuarial valuation, we expect the adoption of FAS 158 to reduce
reported stockholders' equity by approximately $100 million. However, the actual
impact of adopting FAS 158 is highly dependent on a number of factors, including
the discount rates in effect at the next measurement date, and the actual rate
of return on pension assets during fiscal 2007. These factors could
significantly increase or decrease the expected impact of adopting FAS
158.
In
February 2007, the FASB issued Statement No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities, including an amendment of FASB
Statement No. 115" (FAS 159). FAS 159 permits companies to choose to measure
many financial instruments and certain other items at fair value that are not
currently required to be measured at fair value and establishes presentation
and
disclosure requirements designed to facilitate comparisons between companies
that choose different measurement attributes for similar types of assets and
liabilities. The provisions of FAS 159 become effective as of the beginning
of
our 2009 fiscal year. We are currently evaluating the impact that FAS 159 will
have on our financial statements.
NOTE
3 - |
NOTE
PAYABLE - RELATED PARTY
|
On
March
9, 2007, the Company entered into a loan agreement with 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.
Interest expense for the twelve months ending December 31, 2006 was
$451.
PLASTRON
ACQUISITION CORP. I
A
Development Stage Company
NOTES
TO FINANCIAL STATEMENTS
NOTE
4 - |
STOCKHOLDERS’
EQUITY
|
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. As of December 31, 2006, 2,000,000
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.
PART
III
ITEM
1.
INDEX TO EXHIBITS.
Exhibit
|
|
|
Number
|
|
Description
|
|
|
|
3.1
|
|
Certificate
of Incorporation
|
3.2
|
|
By-Laws
|
SIGNATURES
In
accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by
the
undersigned, thereunto duly authorized.
|
|
|
Date:
May 15, 2007 |
PLASTRON ACQUISITION CORP. II |
|
|
|
|
By: |
/s/ Michael Rapp |
|
Name:
Michael Rapp |
|
Title: President |