Stalar 1, Inc. - FORM 10-K - December 28, 2010

Attached files

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EX-31.2 - Stalar 1, Inc.	v206664_ex31-2.htm
EX-31.1 - Stalar 1, Inc.	v206664_ex31-1.htm
EX-32.1 - Stalar 1, Inc.	v206664_ex32-1.htm
EX-23.1 - Stalar 1, Inc.	v206664_ex23-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

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

For the fiscal year ended September 30, 2010

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

000-52971

Commission file number

Stalar 1, Inc.

(Name of Small Business Issuer in its charter)

Delaware		26-1402640
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

317 Madison Avenue, Suite 1520
New York, New York		10017
(Address of principal executive offices)		(Zip Code)

Issuer's telephone number: (212) 953-1544

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

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

Common Stock, $0.0001 Par Value

(Title of Class)

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

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

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

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

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

Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

x Smaller Reporting Company

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

Stalar 1, Inc. had no revenues during its third fiscal year ending September 30, 2010.

The aggregate market value of the Common Stock held by non-affiliates of Stalar 1, Inc. was $1,780.00 on September 30, 2010.

As of December 27, 2010, 2,044,500 shares of the Common Stock of Stalar 1, Inc. were issued and outstanding and no shares of the Preferred Stock of Stalar 1, Inc. were issued or outstanding.

STALAR 1, INC.

Form 10-K

Report for the Fiscal Year Ended September 30, 2010

TABLE OF CONTENTS

		Page
PART I

Item 1.	Business	3
Item 1A.	Risk Factors	3
Item 1B.	Unresolved Staff Comments	3
Item 2.	Properties	3
Item 3.	Legal Proceedings	3

PART II

Item 5.	Market for Registrant’s Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities	3
Item 6.	Selected Financial Data	4
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	5
Item 8.	Financial Statements and Supplementary Data	5
Item 9.	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	5
Item 9A.	Controls and Procedures	5
Item 9B.	Other Information	5

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	6
Item 11.	Executive Compensation	7
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	9
Item 13.	Certain Relationships and Related Transactions, and Director Independence	9
Item 14.	Principal Accountant Fees and Services	9

PART IV

Item 15.	Exhibits, Financial Statement Schedules	10

PART I

ITEM 1. BUSINESS.

Stalar 1, Inc. ("we", "us", "our", the "Company" or the "Registrant") was incorporated in the State of Delaware on November 13, 2007. 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 numerous efforts to date to identify a possible business combination. The business purpose of the Company is to seek the acquisition of, or merger with, an existing operating company.

The Company has conducted negotiations regarding a target business, and has entered into an agreement with one target business, Shenyang Yanshajing Building Material Co., Ltd. (“Shenyang”), as reported in the Company’s most recent current report filing on Form 8-K. The Company and Shenyang entered into a Reverse Merger and Financial Advisory Agreement (the “Agreement”) on November 2, 2010. By letter dated December 4, 2010, Shenyang notified the Company that it was terminating the Agreement. In a letter dated December 6, 2010, Stalar responded that the Agreement did not provide a termination right to Shenyang. By letter dated December 15, 2010 Shenyang’s counsel reiterated Shenyang’s termination and disclaimed any liability to Stalar. By letter dated December 18, 2010, Stalar reiterated its view that Shenyang lacked authority to terminate the Agreement and alleged other breaches under the Agreement.

Currently our Company would be defined as a "shell" company, an entity which is generally described as having no or nominal operations and no or nominal assets. 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 past 12 months, for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with an operating business. The Company will not restrict 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, and/or through borrowings from our stockholders, management or other investors.

We presently have no employees apart from our management. Our sole officer and sole director is engaged in outside business activities and he devotes 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.

ITEM 1A. RISK FACTORS.

A smaller reporting company is not required to provide the information required by this Item.

ITEM 1B . UNRESOLVED STAFF COMMENTS.

A smaller reporting company is not required to provide the information required by this Item.

ITEM 2. PROPERTIES.

The Company neither rents nor owns any property. The Company utilizes the office space and equipment of Dr. Steven Fox, its President, Secretary and sole Director, at no cost on a month to month basis.

ITEM 3. LEGAL PROCEEDINGS.

We are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.

PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

The Company's Common Stock is not trading on any stock exchange. The Company is not aware of any market activity in its stock since its inception and through the date of this filing.

As of December 27, 2010, there were approximately 51 record holders of the Company's Common Stock.

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.

As of September 30, 2010, we had no equity compensation arrangements or plans either approved or not approved by our stockholders. We granted no options during our fiscal year ended September 30, 2010 and had no options outstanding as of September 30, 2010. The Company has not repurchased any equity securities of the Company during the fourth quarter of the fiscal year ended September 30, 2010.

ITEM 6. SELECTED FINANCIAL DATA.

A smaller reporting company is not required to provide the information required by this Item.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following presentation of management's discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with the Company's consolidated financial statements and the accompanying notes thereto. This section and other parts of this report contain forward-looking statements that involve risks and uncertainties. The Company's actual results may differ significantly from the results discussed in the forward-looking statements.

Overview

The Company was incorporated on November 13, 2007. The Company, which is in the development stage, has had no operations during the quarterly period ended September 30, 2010, nor for the period November 13, 2007 (inception) to September 30, 2010 and has no operations as of the date of this filing.

Continuing Operations, Liquidity and Capital Resources

General and administrative expenses were $14,166 for the fiscal year ended September 30, 2010 compared to $20,403 for the period September 30, 2008 to September 30, 2009, and $58,998 for the period November 13, 2007 (inception) to September 30, 2010. General and administrative expenses consist primarily of professional fees and organization expenses. We had a net loss of $14,166 for the period September 30, 2009 to September 30, 2010.

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 an operating business. 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.

We expect no significant changes in the number of our employees other than such changes, if any, incident to a business combination.

During the next 12 months we anticipate incurring costs related to:

a) filing of Exchange Act reports, and

b) costs relating to consummating an acquisition.

Going Concern

We have financed our activities to date from loans from our majority stockholder. We believe we will be able to meet costs anticipated to be incurred in the next 12 months through deferral of fees by certain service providers and additional amounts, as necessary, to be loaned to or invested in us by our stockholders, management or other investors. The report of our independent registered public accounting firm, MSCM LLP, on our audited financial statements contains a qualification regarding our ability to continue as a going concern.

Off-balance Sheet Arrangements

None

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A smaller reporting company is not required to provide the information required by this Item.

ITEM 8. FINANCIAL STATEMENTS.

See the financial statements annexed to this annual report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

In its two most recent fiscal years or any later interim period, the Company has had no disagreements with its independent accountants.

ITEM 9A. CONTROLS AND PROCEDURES.

As of the end of the fiscal period covered by this report ("Evaluation Date"), our management concluded its evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. As of the Evaluation Date, our Chief Executive Officer and Principal Financial Officer concluded that we maintain disclosure controls and procedures that are effective in providing reasonable assurance that information required to be disclosed in our reports under the Securities Act of 1934 (Exchange Act) is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including its Chief Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Our management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management's control objectives. There have been no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the Evaluation Date.

Evaluation of Disclosure Controls and Procedures

Management is responsible for establishing adequate internal controls and procedures designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Company's chief executive officer and the Company's chief operating 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(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended). Based on this evaluation, the Company's chief executive officer and principal financial officer concluded that the Company's disclosure controls and procedures were effective in ensuring that (i) information required to be disclosed in the reports that the Company files or submits under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission and (ii) information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to management, including the Company's chief executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

This annual report does not include a report from the Company’s registered public accounting firm regarding internal control over financial reporting due to the permanent exemption established by the Securities and Exchange Commission for public companies designated as small filers.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal controls over financial reporting during or that could significantly affect these controls subsequent to the date of the evaluation of those controls by the Chief Executive Officer and Principal Financial Officer.

ITEM 9B. OTHER INFORMATION.

None

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

The sole Director and executive officer of the Company for the reported period is as follows:

Name		Age		Position
Steven R. Fox		57		Director, CEO/President, CFO, Secretary

Dr. Fox is a practicing dentist in New York City. Dr. Fox is a fellow in the American College of Dentistry and a fellow in the International College of Dentistry. He is a former faculty member of the Harvard School of Dental Medicine and a former officer of Harvard. In 1999 Dr. Fox was the Ernst and Young Entrepreneur of the Year. Dr. Fox is the Chairman of the Rebel Group, Inc., a privately-held company, that is involved in importing and exporting. Dr. Fox is currently an advisor to Scarguard, LLC, a medical product company. In 1999, Dr. Fox received the Medal of Freedom from the Republican Members of the United States Senate. Since the Company's inception, Dr. Fox has been serving as the Company's CEO/President, CFO, Secretary and sole Director.

Steven Fox is also the President, Secretary, sole Director and controlling stockholder of Stalar 2, Inc., a Delaware corporation. The term of office of our sole Director expires at our annual meeting of stockholders or until his successor is duly elected and qualified.

Significant Employees.

None.

Family Relationships.

None.

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.

Section 16(a) Beneficial Ownership Reporting Compliance

Compliance with Section 16(a) of the Securities Exchange Act of 1934 Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's officers and directors, and persons who own more than 10% of a registered class of the Company's equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission (the "Commission"). Officers, directors and greater than 10% stockholders are required by the Commission's regulations to furnish the Company with copies of all section 16(a) forms they file. To the Company's knowledge, based solely on a review of the copies of reports furnished to the Company during the fiscal year ended September 30, 2010, the Company's officers, directors and greater than 10% stockholders complied with all filing requirements under section 16(a).

Audit Committee.

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 continue to search for a qualified individual for hire.

Code of Ethics.

We have adopted a Code of ethics that applies to all of our executive officers, directors and employees. Our Code of Ethics codifies the business and ethical principles that govern all aspects of our business. This document will be made available in print, free of charge, to any stockholder requesting a copy in writing from the Company.

ITEM 11. EXECUTIVE COMPENSATION.

Summary Compensation Table

As the table below indicates, the Company's President, Secretary and sole Director has not received any cash remuneration since inception.

SUMMARY COMPENSATION TABLE
Name										Non-Equity		Nonqualified
and						Stock		Option		Incentive Plan		Deferred		All Other
principal		Salary		Bonus		Awards		Awards		Compensation		Compensation		Compensation		Total
position	Year	($)		($)		($)		($)		($)		Earnings ($)		($)		($)
Steven R. Fox	2010		0		0		0		0		0		0		0		0
Director,	2009		0		0		0		0		0		0		0		0
CEO/President,	2008		0		0		0		0		0		0		0		0
CFO, Secretary

Narrative Disclosure to the Summary Compensation Table

The Company's President, Secretary and sole Director has not received any cash remuneration since inception. Officers will not receive any remuneration 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. The Company's sole officer and Director intends to devote a limited amount of 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 our sole officer and Director 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 our 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 item, or otherwise.

We have not entered into any employment agreement or consulting agreement with our executive officers. There are no arrangements or plans in which we provide pension, retirement or similar benefits for executive officers.

Although we do not currently compensate our officers, we reserve the right to provide compensation at some time in the future. Our decision to compensate officers depends on the availability of our cash resources with respect to the need for cash to further our business purposes.

Stock Option Grants

We have not granted any stock options to the executive officers or directors since our inception.

Outstanding Equity Awards at Fiscal Year-End

As the table below indicates, the Company has no unexercised options, stock that has not vested, or equity incentive plan awards for our executive officer as of September 30, 2010. The Company has not granted any stock options to the executive officers or directors since our inception.

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

OPTION AWARDS

STOCK AWARDS

Name

Number of

Securities

Underlying

Unexercised

Options

(#)

Exercisable

Number of

Securities

Underlying

Unexercised

Options

(#)

Unexercisable

Equity

Incentive

Plan

Awards:

Number of

Securities

Underlying

Unexercised

Unearned

Options

(#)

Option

Exercise

Price

($)

Option

Expiration

Date

Number

or Units

Stock

That

Have

Not

Vested

(#)

Market

Value

Units

Stock

That

Have

Not

Vested

($)

Equity

Incentive

Plan

Awards:

Number

Unearned

Shares,

Units or

Other

Rights

That Have

Not

Vested

(#)

Equity

Incentive

Plan

Awards:

Market or

Payout

Value of

Unearned

Shares,

Units or

Other

Rights

That

Have Not

Vested

(#)

Steven R. Fox

Compensation of Directors

As the table below indicates, no compensation has been paid to our directors as of September 30, 2010

DIRECTOR COMPENSATION

Name

Fees

Earned

Paid in

Cash

($)

Stock

Awards

($)

Option

Awards

($)

Non-Equity

Incentive

Plan

Compensation

($)

Non-Qualified

Deferred

Compensation

Earnings

($)

All

Other

Compensation

($)

Total

($)

Steven R. Fox

Narrative Disclosure to the Director Compensation Table

The Company does not have any standard arrangements pursuant to which directors of the Company are compensated for services provided as a director. All directors are entitled to reimbursement for expenses reasonably incurred in attending Board of Directors' meetings. There has been no compensation paid to the Company's sole Director as of the end of September 30, 2010.

Stock Option Plans

We did not have a stock option plan in place as of September 30, 2010.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The following table sets forth, as of September 30, 2010 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 Common Stock of the Company.

	Amount and Nature
	of Beneficial
Name and Address	Ownership(2)		Percentage of Class

Steven R. Fox (1)
317 Madison Avenue, Suite 1520,
New York, NY 10017		2,000,000		97.82	%

All Officers and Directors as a group
(one individual)		2,000,000		97.82	%

(1)	Steven R. Fox is the CEO/President, CFO, Secretary and sole Director of the Company.

(2)	All shares are owned directly and of record and such stockholder has sole voting, investment, and dispositive power.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

During the fiscal year ended September 30, 2010, Dr. Steven R. Fox, the sole officer and sole Director of the Company, has advanced funds in the aggregate amount of $13,738 to the Company to cover cash requirements. Inclusive of the $13,738, the aggregate principal amount of all loans made by Dr. Steven R. Fox from the Company’s inception is $46,856. The loans are unsecured and payable on demand with interest at the prime rate.

The Company utilizes the office space and equipment of its President at no cost. Management estimated such amounts to be immaterial.

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.

The sole Director of the Company would not be deemed independent under the independence standards applicable to the Company. The Company does not have a separately designated audit, nominating or compensation committee or committee performing similar functions.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Audit Fees

The fees incurred for the fiscal year ending September 30, 2010 for professional services rendered by our principal accountant for the audit of our annual financial statements and review of our quarterly financial statements is approximately $7,000.

Audit Related Fees

There were no audit related fees for the fiscal years ended September 30, 2010. Audit related fees include fees for assurance and related services rendered by the principal accountant related to the audit or review of our financial statements, not included in the foregoing paragraph.

Tax Fees

There were no tax fees for the fiscal year ended September 30, 2010. Tax fees include fees for professional services rendered by the principal accountant for tax compliance, tax advice and tax planning.

All Other Fees

There were no other professional services rendered by our principal accountant during the last two fiscal years that were not included in the above paragraphs.

The engagement of the Company’s independent auditor, MSCM LLP, was approved by the Company’s Board of Directors which serves as the Audit Committee. The Audit Committee does not anticipate that the Company’s auditor will provide any services other that audit services and consequently the Audit Committee has not adopted any pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X. No services described in Items 9(e)(2) through 9(e)(4) of Schedule 14A were provided by the Company’s auditors.

PART IV

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

(a)(1) FINANCIAL STATEMENTS. The following financial statements are included in this report:

Title of Document		Page
Report of Independent Registered Public Accounting Firm		F-1
Balance Sheets		F-2
Statements of Operations		F-3
Statements of Cash Flows		F-4
Statement of Changes in Stockholders' Deficit		F-5
Notes to Financial Statements		F-6 to F-9

(a)(2) FINANCIAL STATEMENT SCHEDULES. The following financial statement schedules are included as part of this report:

None.

(a)(3) EXHIBITS. The following exhibits are included as part of this report:

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

(1) Incorporated by reference from the Company's registration statement on Form 10-SB filed on December 12, 2007.

(2) Incorporated by reference from the Company's Quarterly Report on Form 10-Q filed on May 7, 2009.

SIGNATURES

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

	STALAR 1, INC.

Dated: December 28, 2010	By	/s/ Steven R. Fox
		Steven R. Fox, President

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/ Steven R. Fox
	Steven R. Fox
	CEO, CFO, President and Secretary

Dated: December 28, 2010

STALAR 1, INC.

(A Development Stage Company)

INDEX TO FINANCIAL STATEMENTS

PERIOD FROM NOVEMBER 13, 2007 (Inception) TO SEPTEMBER 30, 2010

		Page
		No.

FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm		F-1

Balance Sheets		F-2

Statements of Operations		F-3

Statements of Cash Flows		F-4

Statement of Changes in Stockholders’ Deficit		F-5

Notes to Financial Statements		F-6—F-9

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

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Stalar 1, Inc. (A Development Stage Company)

We have audited the accompanying balance sheets of Stalar 1, Inc. as of September 30, 2010 and 2009 and the related statements of operations, changes in stockholders’ deficit and cash flows for the years then ended and for the period from November 13, 2007 (Inception) to September 30, 2010. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Stalar 1, Inc. as of September 30, 2010 and 2009, and the results of its operations and its cash flows for the years then ended and for the period from November 13, 2007 (Inception) to September 30, 2010 in conformity with accounting principles generally accepted in the United States of America.

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

(A Development Stage Company)

BALANCE SHEETS

SEPTEMBER 30, 2010 AND 2009

	2010		2009

ASSETS
Current assets
Cash	$	1,406	$	45

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities
Accounts payable and accrued expenses	$	11,568	$	10,159
Loan payable – Officer		46,856		33,118

Total current liabilities		58,424		43,277


Stockholders’ deficit
Preferred stock - $0.0001 par value; 25,000,000 shares authorized; none issued or outstanding		-		-
Common stock - $0.0001 par value; 75,000,000 shares authorized; 2,044,500 and 2,035,000 issued and outstanding, respectively		205		204
Additional paid-in capital		1,775		1,396
Deficit accumulated during the development stage		58,998		(44,832	)

Total stockholders’ deficit		57,018		(43,232	)

	$	1,406	$	45

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

F-2

STALAR 1, INC.

(A Development Stage Company)

STATEMENTS OF OPERATIONS

							November 13, 2007
	Year Ended			Year Ended			(Inception) to
	September 30, 2010			September 30, 2009			September 30, 2010

Revenues	$	-		$	-		$	-

General and administrative expenses
Professional fees		13,098			18,936			41,068
Organization costs		-			-			14,868
Interest expense		1,068			1,111			2,179
Sundry		-			356			883
		14,166			20,403			58,998

Net loss	$	(14,166	)	$	(20,403	)	$	(58,998	)

Loss per common share:
basic and diluted	$	(0.007	)	$	(0.010	)

Weighted average number of common shares outstanding, basic and diluted		2,042,001			2,032,479

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

F-3

STALAR 1, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

							November 13, 2007
	Year Ended			Year Ended			(Inception) to
	September 30, 2010			September 30, 2009			September 30, 2009

Cash flows from operating activities:
Net loss	$	(14,166	)	$	(20,403	)	$	(58,998	)
Adjustments to reconcile net loss to net cash used in operating activities:
Common stock issued for services		380			400			780
Increases in cash flows from operating activities resulting from changes in:
Accounts payable and accrued expenses		1,409			7,997			11,568

Net cash used in operating activities		(12,377	)		(12,006	)		(46,650	)

Cash flows from financing activities:
Proceeds from issuance of Common Stock		-			-			1,200
Loans from Officer		13,738			10,743			46,856

Net cash provided by financing activities		13,738			10,743			48,056

Net increase (decrease) in cash		1,361			(1,263	)		1,406

Cash, beginning of period		45			1,308			-

Cash, end of period	$	1,406		$	45		$	1,406

Supplemental cash flow information:
Non-cash financing activities:
Common Stock issued for services	$	380		$	400		$	780

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

F-4

STALAR 1, INC.

(A Development Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

							Deficit
							Accumulated
					Additional		During
					Paid-in		Development
	Shares		Amount		Capital		Stage			Total

Shares issued at inception, November 13, 2007	$	-	$	-	$	-	$	-		$	-

Shares issued for cash, at par $0.0001		2,000,000		200		-		-			200

Shares issued for cash, at $0.04 per share		25,000		3		997		-			1,000

Net loss for the period		-		-		-		(24,429	)		(24,429	)

Balance, September 30, 2008		2,025,000		203		997		(24,429	)		(23,229	)

Shares issued for services, valued at $0.04 per share		10,000		1		399		-			400

Net loss for the year		-		-		-		(20,403	)		(20,403	)

Balance, September 30, 2009		2,035,000		204		1,396		(44,832	)		(43,232	)

Shares issued for services, valued at $.04 per share		9,500		1		379		-			380

Net loss for the year		-		-		-		(14,166	)		(14,166	)

Balance, September 30, 2010		2,044,500	$	205	$	1,775	$	(58,998	)	$	(57,018	)