Attached files
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EX-32.1 - OPTION PLACEMENT, INC. | v193794_ex32-1.htm |
EX-31.1 - OPTION PLACEMENT, INC. | v193794_ex31-1.htm |
U.S.
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
x QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
For the
quarterly period ended: June
30, 2010
o 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 000-53638
OPTION PLACEMENT,
INC.
(Exact
name of registrant as specified in its charter)
Nevada
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26-2415625
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(State
or other jurisdiction of
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(I.R.S.
Employer
|
incorporation
or organization)
|
Identification
No.)
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2328 B Hartford
Rd Austin, TX 78703
(Address
of principal executive offices)
(512)
750-5844
Issuer’s
telephone number
2629 River
Dr. Columbia, SC 29201
(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. x
Yes o 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).
o Yes x 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
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.
Large
accelerated filer o
|
Accelerated
filer o
|
Non-accelerated
filer o (Do
not check if a smaller reporting company)
|
Smaller
reporting company x
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). x Yes o 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 Section 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. o Yes o No
APPLICABLE
ONLY TO CORPORATE ISSUERS
State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date: At August 23, 2010 there were
1,125,000 shares of common stock outstanding.
PART
I — FINANCIAL INFORMATION
Item
1. Financial Statements.
|
||
Financial
Statements for the Three-Month Period Ended June 30, 2010
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||
Balance
Sheet as of June 30, 2010 (unaudited) and December 31, 2009
(audited)
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F–1
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Statement
of Operations for the three months ended June 30, 2010 and
2009 (unaudited)
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F–2
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Statement
of Operations for the six months ended June 30, 2010 and 2009
(unaudited)
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F-3
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Statement
of Stockholders’ Deficit for the period ended June 30, 2010
(unaudited)
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F-4
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Statement
of Cash Flows for the three months ended June 30, 2010 and
cumulative since inception (March 5, 2008)(unaudited)
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F–5
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Notes
to the Financial Statements
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F–6
|
2
Balance
Sheets
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||||||||
(A
Development Stage Company)
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||||||||
As
of
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||||||||
June
30,
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December
31,
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|||||||
2010
(unaudited)
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2009
(audited)
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|||||||
ASSETS
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||||||||
CURRENT
ASSETS
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||||||||
Cash
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$ | 281 | $ | 35 | ||||
TOTAL
CURRENT ASSETS
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281 | 35 | ||||||
TOTAL
ASSETS
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281 | 35 | ||||||
LIABILITIES AND
STOCKHOLDERS' DEFICIT
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||||||||
LIABILITIES
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||||||||
CURRENT
LIABILITIES
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||||||||
Note
Payable to a Related Party
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$ | 14,150 | $ | 9,150 | ||||
Accrued
Expenses and Payables
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4,577 | - | ||||||
Accrued
Interest – Related Party
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1,467 | 1,002 | ||||||
TOTAL
CURRENT LIABILITIES
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20,194 | 10,152 | ||||||
TOTAL
LIABILITIES
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20,194 | 10,152 | ||||||
STOCKHOLDERS'
DEFICIT
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||||||||
Preferred
stock ($0.0001 par value; 10,000,000 shares authorized;
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||||||||
none
issued and outstanding)
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- | - | ||||||
Common
stock ($0.0001 par value; 100,000,000 shares authorized;
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||||||||
1,000,000
shares issued and outstanding)
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100 | 100 | ||||||
Deficit
accumulated during the development stage
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(20,013 | ) | (10,217 | ) | ||||
TOTAL
STOCKHOLDERS' DEFICIT
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(19,913 | ) | (10,117 | ) | ||||
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
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$ | 281 | $ | 35 |
The
accompanying notes are an integral part of these financial
statements.
F-1
Option
Placement, Inc.
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||||||||
Statements
of Operations (unaudited)
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||||||||
(A
Development Stage Company)
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||||||||
For
the three months ended
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||||||||
June
30,
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June
30,
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|||||||
2010
|
2009
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|||||||
REVENUES:
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||||||||
Income
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$ | - | $ | - | ||||
Total
Revenue
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- | - | ||||||
EXPENSES:
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||||||||
Selling,
General and Administrative
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4,331 | 636 | ||||||
Professional
Fees
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5,000 | - | ||||||
Total
Expenses
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9,331 | 636 | ||||||
Loss
from operations
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(9,331 | ) | (636 | ) | ||||
OTHER
INCOME/(EXPENSE):
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||||||||
Interest
Expense
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(283 | ) | (197 | ) | ||||
NET
LOSS
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$ | (9,614 | ) | $ | (833 | ) | ||
Basic
and fully diluted net loss per common share:
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$ | (0.01 | ) | $ | (0.00 | ) | ||
Weighted
average common shares outstanding
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1,000,000 | 1,000,000 |
The
accompanying notes are an integral part of these financial
statements.
F-2
Option
Placement, Inc.
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||||||||||||
Statements
of Operations (unaudited)
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(A
Development Stage Company)
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Cumulative
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For
the six months ended
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Total
Since
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June
30,
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June
30,
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Inception
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2010
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2009
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March 5, 2008
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||||||||||
REVENUES:
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||||||||||||
Income
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$ | - | $ | - | $ | - | ||||||
Total
Revenue
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- | - | - | |||||||||
EXPENSES:
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||||||||||||
Selling,
General and Administrative
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4,331 | 636 | 5,846 | |||||||||
Professional
Fees
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5,000 | - | 12,700 | |||||||||
Total
Expenses
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9,331 | 636 | 18,546 | |||||||||
Loss
from operations
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(9,331 | ) | (636 | ) | (18,546 | ) | ||||||
OTHER
INCOME/(EXPENSE):
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||||||||||||
Interest
Expense
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(465 | ) | (396 | ) | (1,467 | ) | ||||||
NET
LOSS
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$ | (9,796 | ) | $ | (1,032 | ) | $ | (20,013 | ) | |||
Basic
and fully diluted net loss per common share:
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$ | (0.01 | ) | $ | (0.00 | ) | $ | (0.02 | ) | |||
Weighted
average common shares outstanding
|
1,000,000 | 1,000,000 | 1,000,000 |
The
accompanying notes are an integral part of these financial
statements.
F-3
Statement
of Stockholders' Deficit (unaudited)
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||||||||||||||||||||||||
(A
Development Stage Company)
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||||||||||||||||||||||||
Additional
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Common
Stock
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Preferred
stock
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Paid-in
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Deficit
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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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Accumulated
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|||||||||||||||||||
Balances,
March 5, 2008 (Inception)
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- | $ | - | - | $ | - | $ | - | $ | - | ||||||||||||||
Net
income/(loss)
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- | - | - | - | - | (7,040 | ) | |||||||||||||||||
Issuance
of founders’ shares
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1,000,000 | 100 | - | - | - | - | ||||||||||||||||||
Balances,
December 31, 2008
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1,000,000 | $ | 100 | - | $ | - | $ | - | $ | (7,040 | ) | |||||||||||||
Net
income/(loss)
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- | - | - | - | - | (3,177 | ) | |||||||||||||||||
Balances,
December 31, 2009
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1,000,000 | $ | 100 | - | $ | - | $ | - | $ | (10,217 | ) | |||||||||||||
Net
income/(loss)
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- | - | - | - | - | (9,796 | ) | |||||||||||||||||
Balances,
June 30, 2010
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1,000,000 | $ | 100 | - | $ | - | $ | - | $ | (20,013 | ) |
The
accompanying notes are an integral part of these financial
statements.
F-4
Statement
of Cash Flows (unaudited)
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||||||||||||
(A
Development Stage Company)
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||||||||||||
For
the six months
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Cumulative
Total
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|||||||||||
Ended
June 30,
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Since
Inception
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2010
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2009
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March 5, 2008
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||||||||||
CASH FLOWS FROM
OPERATING ACTIVITIES:
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||||||||||||
Net
loss
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$ | (9,796 | ) | $ | (1,032 | ) | $ | (20,013 | ) | |||
Adjustments
to reconcile net loss to net cash provided by (used in)
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||||||||||||
operating
activities:
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||||||||||||
Changes
in Assets and Liabilities:
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||||||||||||
Increase/(decrease)
in Accrued Interest – Related Party
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465 | 395 | 1,467 | |||||||||
Increase/(decrease)
in Accounts Payable
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4,577 | - | 4,577 | |||||||||
NET
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
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(4,754 | ) | (637 | ) | (13,969 | ) | ||||||
CASH FLOWS FROM
FINANCING ACTIVITIES:
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||||||||||||
Issuance
of Stock
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- | - | 100 | |||||||||
Proceeds
from a Note Payable to Related Party
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5,000 | 700 | 17,550 | |||||||||
Repayment
of Note Payable to a Related Party
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- | - | (3,400 | ) | ||||||||
NET
CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
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5,000 | 700 | 14,250 | |||||||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
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246 | 63 | 281 | |||||||||
CASH
AND CASH EQUIVALENTS,
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||||||||||||
BEGINNING
BALANCE
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35 | 134 | - | |||||||||
ENDING
BALANCE
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$ | 281 | $ | 197 | $ | 281 | ||||||
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION:
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||||||||||||
CASH
PAID DURING THE PERIOD FOR:
|
||||||||||||
Interest
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$ | - | $ | - | $ | - | ||||||
Taxes
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$ | - | $ | - | $ | - |
The
accompanying notes are an integral part of these financial
statements.
F-5
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE A—BUSINESS
ACTIVITY
Option
Placement, Inc. (the “Company”) was organized under the laws of the State of
Nevada on March 5, 2008 as a corporation. The Company’s objective is
to acquire or merge with a target business or company in a business
combination.
NOTE B—GOING
CONCERN
The
accompanying financial statements have been prepared on a going concern basis,
which assumes the Company will realize its assets and discharge its liabilities
in the normal course of business. As reflected in the accompanying
financial statements, the Company has a deficit accumulated during the
development stage of $20,013 used cash from operations of $13,969 since its
inception, and has a negative working capital of $19,913 at June 30,
2010.
The
Company’s ability to continue as a going concern is dependent upon its ability
to generate future profitable operations and/or to obtain the necessary
financing to meet its obligations and repay its liabilities arising from normal
business operations when they come due. The Company’s ability to
continue as a going concern is also dependent on its ability to find a suitable
target company and enter into a possible reverse merger with such
company. Management’s plan includes obtaining additional funds by
equity financing through a reverse merger transaction and/or related party
advances; however there is no assurance of additional funding being
available. These circumstances raise substantial doubt about the
Company’s ability to continue as a going concern. The accompanying financial
statements do not include any adjustments that might arise as a result of this
uncertainty.
NOTE C—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
Basis of
Presentation- The financial statements included herein were prepared
under the accrual basis of accounting.
Cash and Cash
Equivalents- For purposes of the Statement of Cash Flows, the Company
considers liquid investments with an original maturity of three months or less
to be cash equivalents.
Management’s Use of
Estimates- The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results could differ
from those estimates. The financial statements above reflect all of the costs of
doing business.
Presentation of Interim
Information
The
financial information at June 30, 2010 is unaudited, but includes all
adjustments (consisting only of normal recurring adjustments) that the Company
considers necessary for a fair presentation of the financial information set
forth herein, in accordance with accounting principles generally accepted in the
United States (“U.S. GAAP”) for interim financial information, and with the
instructions to Form 10-Q. Accordingly, such information does not include all of
the information and footnotes required by U.S. GAAP for annual financial
statements. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company’s annual Report on Form
10-K for the year ended December 31, 2009.
The
results for the six and three months ended June 30, 2010 may not be indicative
of results for the year ending December 31, 2010 or any future
periods.
F-6
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE C—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES—CONT’D
Revenue Recognition-
The Company applies paragraph 605-10-S99-1 of the FASB Accounting Standards
Codification for revenue recognition. The Company recognizes revenue
when it is realized or realizable and earned less estimated future doubtful
accounts. The Company considers revenue realized or realizable and
earned when all of the following criteria are met:
|
(i)
|
persuasive
evidence of an arrangement exists,
|
(ii)
|
the
services have been rendered and all required milestones
achieved,
|
(iii)
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the
sales price is fixed or determinable,
and
|
(iv)
|
collectability
is reasonably assured.
|
Comprehensive Income (Loss)
- The Company reports Comprehensive income and its components following
guidance set forth by section 220-10 of the FASB Accounting Standards
Codification which establishes standards for the reporting and display of
comprehensive income and its components in the financial statements. There were
no items of comprehensive income (loss) applicable to the Company during the
period covered in the financial statements.
Net Income per Common
Share- Net loss per common share is computed pursuant to section
260-10-45 of the FASB Accounting Standards Codification. Basic net
loss per share is computed by dividing net loss by the weighted average number
of shares of common stock outstanding during the period. Diluted net
loss per share is computed by dividing net loss by the weighted average number
of shares of common stock and potentially outstanding shares of common stock
during each period. There were no potentially dilutive shares
outstanding as of June 30, 2010.
Deferred Taxes- The
Company accounts for income taxes under Section 740-10-30 of the FASB Accounting
Standards Codification. Deferred income tax assets and liabilities
are determined based upon differences between the financial reporting and tax
bases of assets and liabilities and are measured using the enacted tax rates and
laws that will be in effect when the differences are expected to
reverse. Deferred tax assets are reduced by a valuation allowance to
the extent management concludes it is more likely than not that the assets will
not be realized. Deferred tax assets and liabilities are measured
using enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled. The
effect on deferred tax assets and liabilities of a change in tax rates is
recognized in the statements of operations in the period that includes the
enactment date.
Fair Value of Financial
Instruments- The carrying amounts reported in the balance sheet for cash,
accounts receivable and payable approximate fair value based on the short-term
maturity of these instruments.
Accounts Receivable-
Accounts deemed uncollectible are written off in the year they become
uncollectible. As of June 30, 2010, the balance in Accounts Receivable was
$0.
Impairment of Long-Lived
Assets- The Company evaluates the recoverability of its fixed assets and
other assets in accordance with section 360-10-15 of the FASB Accounting
Standards Codification for disclosures about Impairment or Disposal of
Long-Lived Assets. Disclosure requires recognition of impairment of
long-lived assets in the event the net book value of such assets exceeds its
expected cash flows. If so, it is considered to be impaired and is written down
to fair value, which is determined based on either discounted future cash flows
or appraised values. The Company adopted the statement on inception. No
impairments of these types of assets were recognized during the period ended
June 30, 2010.
F-7
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE C—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES—CONT’D
Stock-Based
Compensation- The Company accounts for stock-based compensation using the
fair value method following the guidance set forth in section 718-10 of the FASB
Accounting Standards Codification for disclosure about Stock-Based Compensation.
This section requires a public entity to measure the cost of employee services
received in exchange for an award of equity instruments based on the grant-date
fair value of the award (with limited exceptions). That cost will be recognized
over the period during which an employee is required to provide service in
exchange for the award- the requisite service period (usually the vesting
period). No compensation cost is recognized for equity instruments for which
employees do not render the requisite service.
Fair Value for Financial
Assets and Financial Liabilities- The Company follows paragraph
825-10-50-10 of the FASB Accounting Standards Codification for disclosures about
fair value of its financial instruments and paragraph 820-10-35-37 of the FASB
Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair
value of its financial instruments. Paragraph 820-10-35-37
establishes a framework for measuring fair value in accounting principles
generally accepted in the United States of America (U.S. GAAP), and expands
disclosures about fair value measurements. To increase consistency and
comparability in fair value measurements and related disclosures, Paragraph
820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to
valuation techniques used to measure fair value into three broad
levels. The fair value hierarchy gives the highest priority to quoted
prices (unadjusted) in active markets for identical assets or liabilities and
the lowest priority to unobservable inputs. The three levels of fair
value hierarchy defined by Paragraph 820-10-35-37 are described
below:
Level
1
|
Quoted
market prices available in active markets for identical assets or
liabilities as of the reporting date.
|
Level
2
|
Pricing
inputs other than quoted prices in active markets included in Level 1,
which are either directly or indirectly observable as of the reporting
date.
|
Level
3
|
Pricing
inputs that are generally observable inputs and not corroborated by market
data.
|
The carrying amounts of the Company’s
financial assets and liabilities, such as cash and accrued expenses, approximate
their fair values because of the short maturity of these instruments. The
Company’s note payable approximates the fair value of such instrument based upon
management’s best estimate of interest rates that would be available to the
Company for similar financial arrangement at June 30, 2010.
The Company does not have any assets or
liabilities measured at fair value on a recurring or a non-recurring basis,
consequently, the Company did not have any fair value adjustments for assets and
liabilities measured at fair value at June 30, 2010, nor gains or losses are
reported in the statement of operations that are attributable to the change in
unrealized gains or losses relating to those assets and liabilities still held
at the reporting date for the interim period ended June 30, 2010.
F-8
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE C—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES—CONT’D
Recent Accounting
Pronouncements
In March
2010, the FASB issued Accounting Standard Update No. 2010-11 “Derivatives and
Hedging” (Topic 815). ASU No. 2010-11 update provides amendments to subtopic
815-15, Derivatives and hedging. The amendments clarify about the scope
exception in paragraph 815-10-15-11 and section 815-15-25 as applicable to the
embedded credit derivatives. The ASU is effective on the first day of the first
fiscal quarter beginning after June 15, 2010. Therefore, for a calendar-year-end
entity, the ASU becomes effective on July 1, 2010. Early application is
permitted at the beginning of the first fiscal quarter beginning after March 5,
2010
In April
2010, the FASB issued Accounting Standard Update No. 2010-12. “Income Taxes”
(Topic 740). ASU No.2010-12 amends FASB Accounting Standard Codification
subtopic 740-10 Income Taxes to include paragraph 740-10-S99-4. On March 30,
2010 The President signed the Health Care & Education Affordable Care Act
reconciliation bill that amends its previous Act signed on March 23, 2010. FASB
Codification topic 740, Income Taxes, requires the measurement of current and
deferred tax liabilities and assets to be based on provisions of enacted tax
law. The effects of future changes in tax laws are not anticipated.” Therefore,
the different enactment dates of the Act and reconciliation measure may affect
registrants with a period-end that falls between March 23, 2010 (enactment date
of the Act), and March 30, 2010 (enactment date of the reconciliation measure).
However, the announcement states that the SEC would not object if such
registrants were to account for the enactment of both the Act and the
reconciliation measure in a period ending on or after March 23, 2010, but notes
that the SEC staff “does not believe that it would be appropriate for
registrants to analogize to this view in any other fact patterns.”
In April
2010, the FASB issued Accounting Standard Update No. 2010-13 “Stock
Compensation” (Topic 718). ASU No.2010-13 provides amendments to Topic 718 to
clarify that an employee share-based payment award with an exercise price
denominated in the currency of a market in which a substantial portion of the
entity's equity securities trades should not be considered to contain a
condition that is not a market, performance, or service condition. Therefore, an
entity would not classify such an award as a liability if it otherwise qualifies
as equity. The amendments in this Update are effective for fiscal years, and
interim periods within those fiscal years, beginning on or after December 15,
2010. The amendments in this Update should be applied by recording a
cumulative-effect adjustment to the opening balance of retained earnings. The
cumulative-effect adjustment should be calculated for all awards outstanding as
of the beginning of the fiscal year in which the amendments are initially
applied, as if the amendments had been applied consistently since the inception
of the award. The cumulative-effect adjustment should be presented separately.
Earlier application is permitted.
In April
2010, the FASB issued Accounting Standards Update No.2010-14, “Accounting for
Extractive Activities – Oil & Gas” (Topic 932). ASU No. 2010-14 amends FASB
accounting Standard paragraph 932-10-S99-1 due to SEC release no. 33-8995 [FR
78], Modernization of Oil and Gas Reporting and provides update as to amendments
to SEC Regulation S-X, Rule 4-10.
In April
2010, the FASB issued Accounting Standard Update No. 2010-15. “Financial
Services-Insurance” (Topic 944) ASU No.2010-15 gives direction on how
investments through separate accounts affect an insurer’s consolidation analysis
of those investments. Under the ASU: an insurance entity should not consider any
separate account interests held for the benefit of policy holders in an
investment to be the insurer's interests and should not combine those interests
with its general account interest in the same investment when assessing the
investment for consolidation, unless the separate account interests are held for
the benefit of a related party policy holder as defined in the Variable Interest
Entities Subsections of Subtopic 810-10 and those Subsections require the
consideration of related parties. The amendments in this Update are effective
for fiscal years, and interim periods within those fiscal years, beginning after
December 15, 2010. Early adoption is permitted. The amendments in this Update
should be applied retrospectively to all prior periods upon the date of
adoption.
F-9
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE C—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES—CONT’D
Recent Accounting
Pronouncements (cont’d)
In April
2010, the FASB issued Accounting Standard Update No. 2010-16.
“Entertainment-Casinos” (Topic 924). ASU No.2010-16 addresses diversity in
practice regarding whether an entity accrues liabilities for a base jackpot
before it is won because they could avoid the payment. The amendments in this
update clarify that an entity should not accrue jackpot liabilities (or portions
thereof) before a jackpot is won if the entity can avoid paying that jackpot.
Jackpots should be accrued and charged to revenue when an entity has the
obligation to pay the jackpot. This guidance applies to both base and
progressive jackpots. The ASU amendments are effective for fiscal years, and the
interim periods within those fiscal years, beginning on or after December 15,
2010.
In April
2010, the FASB issued Accounting Standard Update No. 2010-17. “Revenue
Recognition-Milestone Method” (Topic 605) ASU No.2010-17 provides guidance on
defining a milestone and determining when it may be appropriate to apply the
milestone method of revenue recognition for research or development
transactions. An entity often recognizes these milestone payments as revenue in
their entirety upon achieving a specific result from the research or development
efforts. A vendor can recognize consideration that is contingent upon
achievement of a milestone in its entirety as revenue in the period in which the
milestone is achieved only if the milestone meets all criteria to be considered
substantive. Determining whether a milestone is substantive is a matter of
judgment made at the inception of the arrangement. The ASU is effective for
fiscal years and interim periods within those fiscal years beginning on or after
June 15, 2010. Early application is permitted. Entities can apply this guidance
prospectively to milestones achieved after adoption. However, retrospective
application to all prior periods is also permitted.
In April
2010, the FASB issued Accounting Standard Update No. 2010-18. “Receivables”
(Topic 310). ASU No.2010-18 provides guidance on accounting for acquired loans
that have evidence of credit deterioration upon acquisition. Paragraph
310-30-15-6 allows acquired assets with common risk characteristics to be
accounted for in the aggregated as a pool. Upon establishment of the pool, the
pool becomes the unit of accounting. When loans are accounted for as a pool, the
purchase discount is not allocated to individual loans; thus all of the loans in
the pool accrete at a single pool rate (based on cash flow projections for the
pool). Under subtopic 310-30, the impairment analysis also is performed on the
pool as a whole as opposed to each individual loan. Paragraphs 310-40-15-4
through 15-12 establish the criteria for evaluating whether a loan modification
should be classified as a troubled debt restructuring. Specifically paragraph
310-40-15-5 states that “a restructuring of a debt constitutes a troubled debt
restructuring for purposes of this subtopic if the creditor for economic or
legal reasons related to the debtor’s financial difficulties grants a concession
to the debtor that it would not otherwise consider.” The ASU is effective for
modification of loans accounted for within pools under subtopic 310-30 occurring
in the first interim or annual period ending on or after July 15, 2010. The
amendments are to be applied prospectively. Early application is
permitted.
In May
2010, the FASB issued Accounting Standard Update No. 2010-19 “Foreign Currency”.
(“ASU No. 2010-19”). ASU 2010-19, codifies the SEC staff announcement made at
the March 18, 2010, EITF meeting. The ASU “provides the SEC staff’s views on
certain foreign currency issues related to investments in Venezuela.” These
issues relate to Venezuela’s highly inflationary status. The ASU became
effective on March 18, 2010.
Other
ASUs not effective until after June 30, 2010, are not expected to have a
significant effect on the Company’s consolidated financial position or results
of operations.
F-10
OPTION
PLACEMENT ONE, INC.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
AS
OF JUNE 30, 2010
NOTE D-SUPPLEMENTAL CASH
FLOW INFORMATION
Supplemental
disclosures of cash flow information for the period ended June 30, 2010 and 2009
is summarized as follows:
Cash paid
during the period ended June 30, 2010 and 2009 for interest and income
taxes:
2010
|
2009
|
Inception
to
date
|
|||||||||
Interest
|
$ | - | $ | - | $ |
-
|
|||||
Taxes
|
$ | - | $ | - | $ |
-
|
NOTE E-SEGMENT
REPORTING
The
Company follows the guidance set forth by section 280-10 of the FASB Accounting
Standards Codification for reporting and disclosure on operating segments of the
Company. It also requires segment disclosures about products and services,
geographic areas, and major customers. The Company determined that it did not
have any separately reportable operating segments as of June 30,
2010.
NOTE F-CAPITAL
STOCK
The
Company is authorized to issue 100,000,000 common shares at $0.0001 par value
per share.
During
the period from inception (March 5, 2008) through June 30, 2010, the company has
the following common shares outstanding:
Name
|
Number of shares
|
|||
Jonathan
Patton
|
1,000,000 |
The
Company is authorized to issue 10,000,000 preferred shares at $0.0001 per
share. As of June 30, 2010, the company has not issued any preferred
shares.
NOTE G-DEVELOPMENT STAGE
COMPANY
The
Company is in the development stage as of June 30, 2010 and to date has had no
significant operations. Recovery of the Company assets is dependent on future
events, the outcome of which is indeterminable. In addition, successful
completion of the Company’s development program and its transition, ultimately,
to attaining profitable operations is dependent upon obtaining adequate
financing to fulfill its development activities and achieving a level of sales
adequate to support the Company’s cost structure.
NOTE H—SHAREHOLDER
LOAN/RELATED PARTY
The
Company has signed a series of promissory notes with a related
party. The total amount of loan outstanding is $14,150 and it is
payable upon demand, the annual interest rate on this note is
8%. Accrued interest, but not paid as of June 30, 2010 is
$1,467.
NOTE I—SUBSEQUENT
EVENT
On August
19, 2010, the Company issued 125,000 shares to Jonathan Patton at a value equal
to the par value share, or $12.50. This transaction has been approved
by the Company’s sole member of the board of directors.
F-11
Item 2. Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
Overview.
Option
Placement, Inc. (“we”, “us” or the “Company”) was organized in the State of
Nevada on March 5, 2008. We are a developmental stage company and
have not generated any revenues to date. We were organized to serve
as a vehicle for a business combination through a capital stock exchange,
merger, reverse acquisition, asset acquisition or other similar business
combination (a “Business Combination”) with an operating or development stage
business (the “Target Business”) which desires to utilize our status as a
reporting company under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). We are currently in the process of evaluating
and identifying targets for a Business Combination. We are not
presently engaged in, and will not engage in, any substantive commercial
business operations unless and until we consummate a Business
Combination.
Our
management has broad discretion with respect to identifying and selecting a
prospective Target Business. We have not established any specific
attributes or criteria (financial or otherwise) for prospective Target
Businesses. Our sole officer and director has never served as an
officer or director of a development stage public company with the business
purpose of acquiring a Target Business. Accordingly, he may not
successfully identify a Target Business or conclude a Business
Combination. To the extent we affect a Business Combination
with a financially unstable company or an entity in its early stage of
development or growth, including entities without established records of sales
or earnings, we may be affected by numerous risks inherent in the business and
operations of financially unstable and early stage or potential emerging growth
companies. If we consummate a Business Combination with a foreign
entity, we will be subject to all of the risks attendant to foreign
operations. Although our management will endeavor to evaluate the
risks inherent in a particular Target Business, we cannot assure you that we
will properly ascertain or assess all significant risk factors.
We expect
that in connection with any Business Combination, we will issue a significant
number of shares of our common stock (equal to at least 80% of the total number
of shares outstanding after giving effect to the transaction and likely a
significantly higher percentage) in order to ensure that the Business
Combination qualifies as a “tax free” transaction under federal tax
laws. The issuance of additional shares of our capital stock
will:
·
|
significantly
reduce the equity interest of our stockholders;
and
|
·
|
cause
a change in and likely result in the resignation or removal of our present
officers and directors.
|
Our
management anticipates that our Company likely will affect only one Business
Combination, due primarily to our financial resources 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 potential gains from another.
Liquidity and Capital
Resources.
At June
30, 2010, we had a de minimus amount of cash on hand. We do not
expect that the funds available will be sufficient to cover our operating costs
and expenses over the next twelve months which we anticipate will comprise costs
and expenses in connection with the preparation and filing of reports under the
Exchange Act, the evaluation and investigation of Target Business and, possibly,
for a Business Combination.
We have
not generated any revenue and, to date, we have funded our operations through
loans from our stockholder, who is our sole officer and director, and, as of
June 30, 2010, we had borrowed the aggregate of $14,150 from
him. Management expects to fund additional costs and expenses which
may be incurred in connection with due diligence activities and a Business
Combination through loans or further investment in the Company, as and when
necessary.
We cannot
provide investors with any assurance that we will have sufficient capital
resources to identify a suitable Target Business, to conduct effective due
diligence as to any Target Business or to consummate a Business
Combination. As a result of our negative working capital, our losses
since inception and our failure to generate revenues from operations, our
financial statements include a note in which our auditor has expressed doubt
about our ability to continue as a "going concern."
3
Results of
Operations.
Since our
inception, we have neither engaged in any substantive operations nor generated
any revenue. We reported a net loss for the three month period ended
June 30, 2010 of $7,937 and $8,120, respetively, and a net loss since inception
of $18,337. The Company has a deficit accumulated during the
development stage of used cash from operations of $13,969 since its inception,
and has a negative working capital of $18,737 at June 30, 2010.
We do not
expect to engage in any substantive activities unless and until such time as we
enter into a Business Combination with a Target Business, if ever. We
cannot provide investors with any assessment as to the nature of a Target
Business’s operations or speculate as to the status of its products or
operations, whether at the time of the Business Combination it will be
generating revenues or its future prospects.
Item
3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
Item
4(T). Controls and Procedures.
Evaluation
of Disclosure Controls and Procedures
As of
June 30, 2010, the Company’s management carried out an evaluation, under the
supervision and with the participation of the Company’s Chief Executive Officer,
who is the Company's principal executive officer and principal financial
officer, of the effectiveness of the design and operation of the Company’s
disclosure controls and procedures (as defined in Rules 13a-15 and 15d-15 under
the Exchange Act), pursuant to Exchange Act Rule 13a-15. Based on
management’s evaluation and in light of the weaknesses disclosed in "Part II -
Item 7. Management’s Discussion and Analysis of Financial Statements and Results
of Operations" in our Annual Report on Form 10-K for the year ended Decemb31,
2009, our Chief Executive Officer has concluded that as of June 30, 2010, our
disclosure controls and procedures were not effective.
Changes in Internal
Controls
There
have been no changes in the Company’s internal control over financial reporting
(as defined in Rules 13a-15 and 15d-15 under the Exchange Act) during the three
months ended June 30, 2010 that have materially affected, or are reasonably
likely to materially affect, the Company’s internal control over financial
reporting.
PART
II — OTHER INFORMATION
Item
1. Legal Proceedings.
The
Company is not a party to any legal proceeding or litigation.
Item
1A. Risk Factors.
Smaller
reporting companies are not required to provide the information required by this
item.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds.
(a) During
the three months ended June 30, 2010, the Company did not issue any
securities.
(b) Not
applicable.
4
(c)
During the three months ended June 30, 2010, neither the issuer nor any
"affiliated purchaser," as defined in Rule 10b-18(a)(13), purchased any shares
or other units of any class of the issuer's equity securities.
Item
3. Defaults Upon Senior Securities.
None.
Item
4. (Removed and Reserved)
Item
5. Other Information.
(a) On
August 9, 2010, the Company issued 125,000 shares of common stock to our sole
stockholder, who also serves as our sole director and officer, for a price equal
to the par value per share, or $12.50, pursuant to the exemption from the
registration requirements of the Securities Act of 1933, as amended, afforded by
Section 4(2) thereof.
(b) The
Company has not adopted any procedures by which security holders may recommend
nominees to the registrant's board of directors.
Item
6. Exhibits.
Exhibit
|
Description
|
31.1
|
Certification
of the Company’s Principal Executive Officer and 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, 2010.
|
32.1*
|
Certification
of the Company’s Principal Executive Officer and Principal Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of the Sarbanes Oxley Act of
2002.
|
* Pursuant to Commission
Release No. 33-8238, this certification will be treated as “accompanying”
this Quarterly Report on Form 10-Q and not “filed” as part of such report for
purposes of Section 18 of the Exchange Act or otherwise subject to the
liability of Section 18 of the Exchange Act and this certification will not
be deemed to be incorporated by reference into any filing under the Securities
Act or the Exchange Act except to the extent that the registrant specifically
incorporates it by reference.
5
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused the Report to be signed on its behalf by the
undersigned thereunto duly authorized.
OPTION PLACEMENT, INC. | ||
Dated:
August 23, 2010
|
By:
|
/s/ Jonathan
Patton
|
Name:
|
Jonathan
Patton
|
|
Title:
|
President,
Principal Executive Officer
and
Principal Financial Officer
|
6