UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549




FORM
10-K


(Mark
One)


x ANNUAL REPORT
UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934




For the
fiscal year ended: June 30,
2010




o TRANSITION REPORT UNDER
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the
transition period from ________ to ________





Commission
File No.: 000-53544





QUALITY ALLIANCE GROUP,
INC.


(Exact
name of registrant as specified in its charter)





Nevada
                    
                    26-2718129(State
      or other jurisdiction of incorporation or organization)
                    
                    (I.R.S.
      Employer Identification
No.)





13406 Sir Britton Court,
Chesterfield, Virginia 28832


(Address
of principal executive offices)





(804)
608-0208


Issuer’s
telephone number





Securities
registered under Section 12(b) of the Exchange Act:





None





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





Common Stock, par value
$0.0001 per share


(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 x No





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


 ̈ Yes   x  No





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    ̈  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).


x  Yes    ̈  No





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  Yes    ̈  No





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





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





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


x Yes  ̈ No





State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
last sold, or the average bid and asked price of such common equity, as of the
last business day of the registrant’s most recently completed second fiscal
quarter.    $0





APPLICABLE
ONLY TO REGISTRANTS 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.


 ̈  Yes    ̈  No





(APPLICABLE
ONLY TO CORPORATE REGISTRANTS)





Indicate
the number of shares outstanding of each of the registrant’s classes of common
stock, as of the latest practicable date.    At October 11,
2010 there were 1,000,000 shares of common stock outstanding.





DOCUMENTS
INCORPORATED BY REFERENCE


None











TABLE
OF CONTENTS





FORWARD-LOOKING
      STATEMENTSPART
      IItem 1. Description of
    Business
                                                                        2Item 1A. Risk Factors.
                                                                        7Item 1B. Unresolved Staff
      Comments.
                                                                        14Item 2. Properties.
                                                                        14Item 3. Legal Proceedings.
                                                                        14Item 4. Removed and
    Reserved.
                                                                        14PART IIItem 5. Market for Registrant’s Common Equity,
      Related Stockholder Matters and Issuer Purchases of Equity
      Securities.
                                                                        14Item 6. Selected Financial
      Data.
                                                                        15Item 7. Management’s Discussion and Analysis of
      Financial Condition and Results of Operations.
                                                                        15Item 7A. Quantitative and Qualitative Disclosures
      About Market Risk.
                                                                        17Item 8. Financial Statements and Supplementary
      Data.
                                                                        17Item 9. Changes in and Disagreements With
      Accountants on Accounting and Financial Disclosure.
                                                                        18Item 9A. Controls and
      Procedures.
                                                                        18Item 9B. Other Information.
                                                                        19PART IIIItem 10. Directors, Executive Officers and
      Corporate Governance.
                                                                        19Item 11. Executive
      Compensation.
                                                                        20Item 12. Security Ownership of Certain Beneficial
      Owners and Management and Related Stockholder
    Matters.
                                                                        20Item 13. Certain Relationships and Related
      Transactions, and Director Independence.
                                                                        21Item 14. Principal Accounting Fees and
      Services.
                                                                        21PART IVItem 15. Exhibits, Financial Statement
      Schedules.
                                                                        22FINANCIAL STATEMENT INDEX
                                                                        18SIGNATURES
                                                                        23







FORWARD-LOOKING
STATEMENTS




This
Annual Report on Form 10-K and the documents incorporated by reference into the
Annual Report on Form 10-K include forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934.  These forward-looking statements can be
identified by the use of forward-looking terminology, including the words
“believes,” “estimates,” “anticipates,” “expects,” “intends,” “plans,” “may,”
“will,” “potential,” “continue,” or “should,” or, in each case, their negative
or other variations or comparable terminology.  Such statements
include, but are not limited to, any statements relating to our ability to
consummate any acquisition or other business combination and any other
statements that are not statements of current or historical facts. These
statements are based on management’s current expectations, but actual results
may differ materially due to various factors, including, but not limited to, our
being a development stage company with no operating history; our lack of
funding; the inexperience of our management with respect to our business plan;
our potential inability to consummate a business combination with an operating
company that is generating revenues; the possibility that our company may never
generate revenues; unknown risks that may attend to a business with which we
consummate a business combination; our personnel allocating his time to other
businesses and potentially having conflicts of interest with our business; the
ownership of our securities being concentrated, and those other risks and
uncertainties detailed herein and in the Company’s filings with the Securities
and Exchange Commission.




By their
nature, forward-looking statements involve risks and uncertainties because they
relate to events and depend on circumstances that may or may not occur in the
future.  We caution you that forward-looking statements are not
guarantees of future performance and that our actual results of operations,
financial condition and liquidity, and developments in the industry in which we
operate may differ materially from those made in or suggested by the
forward-looking statements contained in this Annual Report on Form
10-K.  In addition, even if our results of operations, financial
condition and liquidity, and developments in the industry in which we operate
are consistent with the forward-looking statements contained in this Annual
Report on Form 10-K, those results or developments may not be indicative of
results or developments in subsequent periods.




These
forward-looking statements are subject to numerous risks, uncertainties and
assumptions about us described in “Risk Factors.”  The forward-looking
events we discuss in this Annual Report on Form 10-K speak only as of the date
of such statement and might not occur in light of these risks, uncertainties and
assumptions.  Except as required by applicable law, we undertake no
obligation and disclaim any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.











PART
I





Item
1. Description of Business





General





Quality
Alliance Group, Inc. (“we”, “us”, the “Company” or like terms) was incorporated
in the State of Nevada on May 7, 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, 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”),
which such transactions sometimes are referred to as "reverse acquisitions" or
"reverse mergers."   Since inception, our business operations
have comprised attending to organizational matters, registering our class of
common stock under the Exchange Act and identifying and evaluating potential
Target Businesses.  We have no full-time employees and do not own or
lease any property.





The Company, based on its proposed
business activities, is a “blank check” company.  The Securities and
Exchange Commission (“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 Exchange Act and that has no specific business plan or
purpose, or has indicated that its business plan is to merge with an
unidentified company or companies.   Many states have enacted
statutes, rules and regulations limiting the sale of securities of “blank check”
companies in their respective jurisdictions.   In addition, under
Rule 12b-2 of the Exchange Act, the Company also is a “shell company” which is
defined, as a company which has (i) no or nominal operations; and (ii) either
(x) no or nominal assets; (y) assets consisting solely of cash and cash
equivalents; or (z) assets consisting of any amount of cash and cash equivalents
and nominal other assets.  Because we are a "shell" company, the
Business Combination we enter into with a Target Business will be deemed to be a
"reverse acquisition" or "reverse merger."





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, and then
only in the discretion of management of our Business Combination
partner.  The Company intends to comply with the periodic reporting
requirements of the Exchange Act for so long as we are subject to those
requirements.





We are
not presently engaged in, and will not engage in, any substantive commercial
business operations until we consummate a Business Combination, if
ever.  We are currently in the process of identifying and evaluating
targets for a Business Combination but we do not have any specific Business
Combination under consideration.  Our efforts to identify a
prospective Target Business are not limited to a particular industry or
geographic location.  We will seek to consummate the transaction which
is most attractive and provides the greatest opportunity for creating
securityholder value.  The determination as to which opportunity is
the most attractive will be based on our analysis of a variety of factors,
including the terms of the transaction and the perceived quality of the business
of the Target Business, among others, some which are described
below.  We believe that the owners of potential Target Businesses may
find an acquisition by us to be an easier and less dilutive means to achieve
liquidity than an initial public offering or other forms of financing
transactions.  We cannot assure you that we will be able to identify
and attract a Target Business or that we will be able to engage in a transaction
on favorable terms or at all.





Affecting
a Business Combination





General.





A
Business Combination may involve the acquisition of or merger with a company
that desires to have a class of securities registered under the Exchange Act,
while avoiding what its management may deem to be the adverse consequences of
undertaking a public offering itself.  These include time delays,
significant expense, possible loss of voting control by the target's existing
management through dilution of their ownership position and compliance with
various federal and state securities laws.  As more fully described
below under the heading “Form
of acquisition; Opportunity for stockholder approval,” the proposed
structure of a Business Combination may not require that we seek stockholder
approval for the transaction and holders of our common stock may not have the
opportunity to vote upon a proposed Business Combination.





2








Search
for a target.




We are
currently in the process of identifying and evaluating potential Target
Businesses.  As described below in more detail, we have virtually
unrestricted flexibility in identifying and selecting prospective acquisition
candidates.  At such time as we affect a Business Combination, if
ever, we may be impacted by numerous risks inherent in the business and
operations of the Target Business.  The risks attendant to the Target
Business may include risks typical of a financially unstable company or an
entity in its early stage of development or growth, including entities without
established records of sales or earnings.  Although our management
will endeavor to evaluate the risks inherent in a particular target, we cannot
assure you that we will properly ascertain or assess all significant risk
factors.





Sources
of Target Businesses.





We intend
to source our target opportunities from various internal and external
sources.  Target candidates have been, and we anticipate will continue
to be, brought to our attention from affiliated and unaffiliated
sources.  We believe that we will be able to identify target
opportunities from internal sources primarily resulting from personal contacts
and relationships that our officer and director and his affiliates have
developed and maintain with various professionals, including accountants,
consultants, bankers, attorneys and other investors, as a result of formal or
informal inquiries or discussions they may have, as well as attending trade
shows or conventions.  Target Business candidates may be brought to
our attention by unaffiliated sources as a result of being solicited by us
through calls or mailings.  These sources may also introduce us to
Target Businesses candidates in which they believe we may have an interest on an
unsolicited basis.  In addition, we may retain the services of agents
or other representatives to identify or locate suitable targets on our behalf,
though we have not engaged any such persons, to date.





In no
event will our existing officer, director or stockholder, or any entity with
which he is affiliated, be paid any finder’s fee, consulting fee or other
compensation prior to, or for any services they render in connection with the
consummation of a Business Combination.





Target
Business candidates may be brought to our attention by unaffiliated sources as a
result of being solicited by us through calls or mailings.  These
sources may also introduce us to Target Business candidates in which they
believe we may have an interest.  In addition, we may retain the
services of agents or other representatives to identify or locate suitable
targets on our behalf, though we have not engaged any such persons to
date.  In the event that we retain the services of professional firms
or other individuals that specialize in business acquisitions, we may pay a
finder’s fee, consulting fee or other compensation to be determined in an arm’s
length negotiation based on the terms of the transaction.  We have not
adopted any policies with respect to utilizing the services of consultants or
advisors to assist in the identification of a Target Business, the criteria to
be used in selecting such consultants or advisors, the services to be provided,
the term of service, or regarding the total amount of fees that may be
paid.  However, because of our limited cash resources, it is likely
that any such fee we agree to pay would be paid in shares of our common
stock.





Selection
criteria of a Target Business.





Our
management will have virtually unrestricted flexibility in identifying and
selecting a prospective Target Business.  We have not established any
specific attributes or criteria (financial or otherwise) for prospective Target
Businesses.  In evaluating a prospective Target Business, our
management will consider, among other factors, the following:




·
            financial
      condition and results of operation;


·
            growth
      potential;


·
            experience
      and skill of management and availability of additional
      personnel;


·
            capital
      requirements;





3




·
            competitive
      position;


·
            barriers
      to entry in the industry;


·
            stage
      of development of the products, processes or
  services;


·
            degree
      of current or potential market acceptance of the products, processes or
      services;


·
            proprietary
      features and degree of intellectual property or other protection of the
      products, processes or services;


·
            regulatory
      environment of the industry; and


·
            costs
      associated with effecting the Business
  Combination.





These
criteria are not intended to be exhaustive or to in any way limit the board of
director’s unrestricted discretion to enter into a Business Combination with any
Target Business.  Any evaluation relating to the merits of a
particular Business Combination will be based, to the extent relevant, on the
above factors as well as other considerations deemed relevant by our
management.





Due
Diligence Investigation.





In
evaluating a prospective Target Business, we will conduct as extensive a due
diligence review of potential targets as possible in view of our lack of
financial resources and the inexperience of our management in such
endeavors.  Moreover, management’s decisions will be made without
detailed feasibility studies, independent analyses, market surveys and the like,
which, if we had more funds available to us, would be
desirable.  Given our current resources, we will likely enter into a
Business Combination with a privately-held company in its early stages of
development or that has only a limited operating history on which to base our
decision.  Generally, very little public information exists about
these companies and we will be required to rely on the ability of our management
to obtain adequate information to evaluate the potential returns from entering
into a Business Combination with such a company.  We will be
particularly dependent in making decisions upon information provided by the
promoters, owners, sponsors or others associated with the business opportunity
seeking our participation.  We expect that our due diligence may
include, among other things, meetings with the Target Business’s incumbent
management and inspection of its facilities, as well as a review of financial
and other information that is made available to us.  This due
diligence review will be conducted by our management, possibly with the
assistance of the Company's counsel and accountants, as necessary.





It is
unlikely that our management at the time of a Business Combination will continue
in any material capacity with the Company after the consummation of a Business
Combination, other than as a stockholder.





Our assessment of a Target Business and
its management may not be accurate.   If we do not uncover all material
information about a Target Business prior to a Business Combination, we may not
make a fully informed investment decision and we may lose money on our
investment.





The time
and costs required to select and evaluate a Target Business and to structure and
complete the Business Combination cannot presently be ascertained with any
degree of certainty.  Any costs we incur with respect to the
identification and evaluation of a prospective Target Business with which a
Business Combination is not ultimately completed may result in a loss to
us.





Lack
of diversification.





We expect
that we will be able to consummate a Business Combination with only one
candidate given that, among other considerations, we will not have the resources
to diversify our operations. Moreover, given that we likely will offer a
controlling interest in our Company to a Target Business in order to achieve a
tax-free reorganization, as described below, the dilution of interest to present
and prospective stockholders will render more than one Business Combination
unlikely. Therefore, at least initially, the prospects for our success may be
entirely dependent upon the future performance of a single business and we will
not benefit from the possible spreading of risks or offsetting of losses that
Business Combinations with multiple operating entities would offer. By
consummating a Business Combination with a single entity, our lack of
diversification may:




4




·
            result
      in our dependency upon the development or market acceptance of a single or
      limited number of products, processes or services;
  and





·
            subject
      us to numerous economic, competitive and regulatory developments, any or
      all of which may have a substantial adverse impact upon the particular
      industry in which we may operate subsequent to a Business
      Combination.





Form
of acquisition; Opportunity for stockholder approval.





Although
we cannot predict the terms of any Business Combination, we will seek to
structure a Business Combination to qualify as a tax-free transaction under the
Internal Revenue Code of 1986, as amended (the "Code").  Tax-free
treatment of such a transaction can be accomplished, if structured correctly,
either through the acquisition of all of the outstanding shares of capital stock
of a Target Business or through a merger (either directly or through a wholly
owned subsidiary of our Company) with a Target Business.  Depending on
the circumstances of any acquisition, however, we may not be able to structure a
transaction in the most tax advantageous manner.  Further, we cannot
assure you that the Internal Revenue Service or state tax authorities will agree
with our tax treatment of any transaction.





If the
transaction is structured as an acquisition, we will acquire our participation
in a Target Business through the acquisition of all of the outstanding shares of
its capital stock in exchange for the issuance of our common stock or other
securities to the security holders of the Target Business and the Target
Business would become our wholly owned subsidiary.  If the transaction
is structured as a statutory merger or consolidation, we would merge a Target
Business with and into our Company or a wholly owned subsidiary of our
Company.





Acquisition:  Under
Section 368(a)(1) of the Code, in order for a stock exchange transaction to
qualify as a "tax free" reorganization, the holders of the stock of the target
must receive a number of shares of our capital stock equal to 80% or more of the
voting stock of our Company.  If a transaction were structured to take
advantage of these provisions rather than other "tax free" provisions provided
under the Code, our existing stockholders would, in such circumstances, retain
20% or less of the total issued and outstanding shares of the surviving
entity.  Depending upon the relative negotiating strength of the
parties, our stockholders at the time of the Business Combination may retain
substantially less than 20% of the total issued and outstanding shares of our
Company, which is likely in our case.  This would result in
substantial additional dilution to the equity of those persons who were
stockholders of our Company prior to such Business Combination.  As
part of such a transaction, all or a majority of our Company's then management
at the time may resign and new directors may be appointed without any vote by
stockholders.  If the Business Combination is structured as an
acquisition of a Target Business's stock, our Company will not require the vote
or approval of stockholders and the transaction may be accomplished in the sole
determination of management.





Merger:  In
a merger transaction, we would merge a Target Business with and into our Company
or a wholly-owned subsidiary.  Simultaneous with the merger, we may
affect a recapitalization in order to achieve a manageable float of our
outstanding capital stock.  However, a proposed merger transaction
would require the approval of the holders of a majority of the outstanding
shares of our common stock and it may necessitate calling a stockholders'
meeting to obtain such approval and filings with the SEC and state
agencies.  The necessity to obtain stockholder approval may result in
delay and additional expense in the consummation of any proposed transaction and
will also give rise to certain rights to dissenting stockholders who could
require that the Company purchase their shares at a price equal to the fair
market value in cash.





In light
of the above, management likely will seek to structure a Business Combination so
as not to require stockholder approval.





In view
of our status as a "shell" company, any acquisition of the stock of or the
merger with an operating company would be deemed to be a "reverse acquisition"
or "reverse merger," respectively.




5





We
anticipate that the investigation of specific business opportunities and the
negotiation, drafting and execution of relevant agreements, disclosure documents
and other instruments will require significant 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
incurred in the related investigation would not be
recoverable.  Furthermore, even if an agreement is reached for a
Business Combination, the failure to consummate that transaction may result in
the loss to the Company of the related costs incurred.





In the
case of either an acquisition or merger, our stockholders prior to the
consummation of a Business Combination likely will not have control of a
majority of the voting shares of the Company following a Business
Combination.  As part of such a transaction, all or a majority of the
Company's then directors may resign and new directors may be appointed without
any vote by stockholders.





Competition





Our
ability to consummate a Business Combination will be constrained by our lack of
financial resources to provide to the Target Business.  We expect that
in the course of identifying, evaluating and selecting a Target Business, we may
encounter intense competition from other entities having a business objective
similar to ours.  These include blank check companies that have raised
significant capital through sales of securities registered under federal
securities laws and that have a business plan similar to ours and, consequently,
possess a significant competitive advantage over our Company both from a
financial and personnel perspective.  Additionally, we may be subject
to competition from other entities having a business objective similar to ours,
including venture capital firms, leveraged buyout firms and operating businesses
looking to expand their operations through acquisitions.  Many of
these entities are well established, possess significant capital, may be able to
offer securities for which a trading market exists and that have extensive
experience identifying and affecting business combinations directly or through
affiliates.  Moreover, nearly all of these competitors possess greater
technical, human and other resources than us.  In addition, we will
experience competition from other modestly capitalized shell companies that are
seeking to enter into business combinations with targets similar to those we
expect to pursue.





While we
believe there may be numerous potential target candidates with which we could
affect a Business Combination, our ability to compete in affecting a Business
Combination with prime candidates will be limited by our lack of financial
resources.  This inherent competitive limitation gives others an
advantage in pursuing the acquisition of the most attractive Target
Businesses.





If we
succeed in affecting a Business Combination, there will be, in all likelihood,
intense competition from competitors of the Target Business.  We
cannot apprise you of any of these risks nor can we assure you that, subsequent
to a Business Combination, we will have the resources or ability to compete
effectively.





Employees





We have
one executive officer who has other business interests and is not obligated to
devote any specific number of hours to our matters.  He intends to
devote only as much time as he deems necessary to our affairs.  The
amount of time management will devote to our affairs in any time period will
vary based on whether a Target Business has been selected for the Business
Combination and the stage of the Business Combination process the Company is
in.  Accordingly, as management identifies suitable Target Businesses,
we expect that our management will spend more time investigating such Target
Business and will devote additional time and effort negotiating and processing
the Business Combination as developments warrant.  We do not intend to
have any full time employees prior to the consummation of a Business
Combination.





Our
management may engage in other business activities similar and dissimilar to
those we are engaged in without any limitations or restrictions applicable to
such activities.  To the extent that our management engages in such
other activities, there will be possible conflicts of interest in diverting
opportunities which would be appropriate for our Company to another company, or
to entities or persons with which our management is or may be associated or have
an interest, rather than diverting such opportunities to us.  Since we
have not established any policy for the resolution of such a conflict, we could
be adversely affected should our officer/director choose to place his other
business interests before ours.  We cannot assure you that potential
conflicts of interest will not result in the loss of potential opportunities or
that any conflict will be resolved in our favor.





6





Our
officer and director may actively negotiate for or otherwise consent to the
disposition of all or any portion of the shares of common stock he owns, as a
condition to, or in connection, with a Business
Combination.  Therefore, it is possible that the terms of any Business
Combination will provide for the sale of all or a portion of his shares of
common stock which would raise issues relating to a possible conflict of
interest with any of our other securityholders.





Item
1A. Risk Factors.





An
investment in our securities involves a high degree of risk. You should consider
carefully all of the risks described below, together with the other information
contained in this Annual Report on Form 10-K before making a decision to invest
in our securities.  If any of the following risks occur, our business,
financial condition and results of operations may be materially adversely
affected.





The
absence of operations and revenues raises substantial doubt about our ability to
continue as a going concern.





The
report of our independent auditor and Note 6 to the financial statements
included in this Annual Report indicate that the Company is in the development
stage, has suffered losses from operations, has a net capital deficiency and has
yet to generate cash flow, and that these factors raise substantial doubt about
the Company’s ability to continue as a going concern.  In addition, we
have no significant assets or financial resources.  We will continue
to sustain operating expenses without corresponding revenues, at least until the
consummation of a Business Combination.  This will result in continued
net operating losses that will increase until we can consummate a Business
Combination with a profitable Target Business.  Our operating and
financial condition renders it unlikely that we would be able to obtain
third-party financing to sustain operations, if necessary.   In
light of our limited resources, we cannot assure you that we will be able to
continue operations, that we will be able to identify a suitable Target Business
or that we will consummate a Business Combination.





We
are dependent entirely upon our stockholder to fund our
operations.  We may have insufficient resources to cover our operating
expenses and the costs and expenses of consummating a Business
Combination.





We are not generating any revenues and
possess limited capital to fund our operations, including for such purposes as
preparing and filing periodic reports under the Exchange Act, identifying a
Target Business and negotiating a Business Combination.  We are
dependent entirely on our sole stockholder to provide funds for the foregoing
requirements and for any other corporate purposes that may arise in the
future.  Though our stockholder has advised us of its intention to
fund our operations, there is no written agreement binding it to do
so.  Our operating and financial condition renders it unlikely that we
would be able to obtain third-party financing to sustain operations, if
necessary.   In the event that our stockholder does not fund our
capital requirements, we may not be able to continue operations and stockholders
could lose the entire amount of their investment in our Company.





We
are a development stage company with no operating history and, accordingly,
there is no basis upon which to evaluate our ability to achieve our business
objective.





We are a
development stage company and have not engaged in any revenue generating
activities to date.  Since we do not have any operating history, you
will have no basis upon which to evaluate our ability to achieve our business
objective.  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 or
generate any revenue until we consummate such a transaction, if
ever.  We cannot assure you as to when or if a Business Combination
will occur.





7




We
may have insufficient resources to cover our operating expenses and the costs
and expenses of consummating a Business Combination.





At June
30, 2010, we had a de minimus amount of cash on hand and no other assets of any
kind.  We do not expect that these funds will be sufficient to cover
our operating costs and expenses, including those we will incur in connection
with satisfying our reporting obligations under the Exchange Act and
consummating a Business Combination.  If our financial resources are
inadequate to cover our costs and expenses, we will require additional financing
and we cannot be certain that such financing will be available to us on
acceptable terms, if at all.  Our failure to secure funds necessary to
cover our costs and expenses would have an adverse affect on our operations and
ability to achieve our objective.





Our
sole officer and director has never been a principal of, nor has he ever been
affiliated with, a company formed with a business purpose similar to
ours.





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.  Furthermore, our
sole officer and director has never been involved with a public shell company of
any sort.  Accordingly, you may not be able to adequately evaluate his
ability to consummate successfully a Business Combination.  Moreover,
our officer and director does not have experience evaluating or conducting due
diligence with respect to companies in connection with a Business Combination
and he may not uncover all material information about a Target Business prior to
a Business Combination nor may he accurately assess a Target Company's business
or management.  Management's failure to conduct complete and accurate
due diligence or accurately assess the future strength of a Target Business
could have a significant negative impact on our operations and could cause our
stockholders to lose entire investment.





Our
officer and director will apportion his time to other businesses which may cause
conflicts of interest in his determination as to how much time to devote to our
affairs.  This conflict of interest could have a negative impact on
our ability to consummate a Business Combination.





Our sole
officer and director engages in other businesses and is not required to devote
his full time or any specific number of hours to our affairs, which could create
a conflict of interest when allocating his time between our operations and his
other commitments.  We do not have and do not expect to have any full
time employees prior to the consummation of a Business
Combination.  If our officer’s and director’s other business affairs
require him to devote more substantial amounts of time to such affairs, it could
limit his ability to devote time to our affairs and could have a negative impact
on our ability to consummate a Business Combination.  We cannot assure
you that these conflicts will be resolved in our favor.





Our
sole officer and director may in the future become affiliated with entities
engaged in business activities similar to those conducted by us and,
accordingly, may have conflicts of interest in determining to which entity a
particular business opportunity should be presented.`





Our sole
officer and director may in the future become affiliated with entities,
including other shell companies, engaged in business activities similar to those
intended to be conducted by us, though he has no present intention of becoming
affiliated with any such entities. Additionally, our sole officer and director
may become aware of business opportunities which may be appropriate for
presentation to us as well as the other entities to which he may owe fiduciary
duties.  Accordingly, he may have conflicts of interest in determining
to which entity a particular business opportunity should be
presented.  We cannot assure you that these conflicts will be resolved
in our favor. As a result, a potential Target Business may be presented to
another entity prior to its presentation to us and we may not be able to pursue
a potential transaction.





8




Our
future success is dependent on the ability of management to complete a Business
Combination with a Target Business that operates profitably.





The
nature of our operations is highly speculative.  The future success of
our plan of operation will depend to a great extent on the operations, financial
condition and management of the Target Business we may acquire.  The
future success of our plan of operation will depend entirely on the operations,
financial condition and management of the Target Business with which we may
enter into a Business Combination.  While management is seeking to
enter into a Business Combination with an entity having an established,
profitable operating history and effective management, we cannot assure you that
we will be successful in consummating a Business Combination with a candidate
that meets that those criteria.





We
have no existing agreement for a Business Combination or other
transaction.





We
presently have no written arrangement or agreement with respect to engaging in a
Business Combination.  We cannot assure you that we will successfully
identify and evaluate suitable business opportunities or that we will enter into
a Business Combination.  Management has not identified any particular
industry or specific business within an industry for evaluation.  We
cannot assure you that we will be able to negotiate a Business Combination on
favorable terms.





The
time and cost of preparing a private company to become a public reporting
company may preclude us from entering into a Business Combination with the most
attractive private companies.





Target
companies that we may investigate that fail to comply with SEC reporting
requirements, financial and otherwise, may delay or preclude a Business
Combination.  Sections 13 and 15(d) of the Exchange Act require
reporting companies to provide certain information about significant
acquisitions, including audited financial statements for the company
acquired.  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.





If
we affect a Business Combination with a financially unstable company or an
entity in the early stage of development or growth, we will be subject to
greater risks than if we were to affect a Business Combination with a more
established company with a proven record of earnings and growth.





Given our
financial and personnel resources compared to those of our competitors, we may
be limited to consummating a Business Combination with a company that is
financially unstable or is in the early stage of development or growth,
including an entity without established records of sales or
earnings.  To the extent we affect a Business Combination with a
financially unstable or early stage or emerging growth company, we may be
impacted by numerous risks inherent in the business and operations of such
company that we would not be subject to if we were to affect a Business
Combination with a more seasoned company with a proven record of earnings and
growth.





We
likely will complete only one Business Combination, which will cause us to be
dependent solely on a single business and a limited number of products, services
or assets.





Given our
limited financial resources and other considerations, it is likely we will
complete a Business Combination with only one Target
Business.  Accordingly, the prospects for our success may be solely
dependent upon the performance of a single business and dependent upon the
development or market acceptance of a single or limited number of products,
processes or services.  In this case, we will not be able to diversify
our operations or benefit from the possible spreading of risks or offsetting of
losses, unlike other entities which may have the resources to complete several
Business Combinations or asset acquisitions in different industries or different
areas of a single industry so as to diversify risks and offset
losses.





Given
our limited resources and the significant competition for Target Businesses, we
may not be able to consummate an attractive Business Combination.





We will
encounter intense competition from other entities having a business objective
similar to ours, including blank check companies, finance companies, banks,
venture capital funds, leveraged buyout funds, operating businesses and other
financial buyers competing for acquisitions.  Many of these entities
are well established and have extensive experience in identifying and affecting
Business Combinations directly or through affiliates.  Nearly all of
these competitors possess greater financial, technical, human and other
resources than we do and our financial resources will be negligible when
contrasted with those of many of these competitors.  In addition, we
will experience direct competition from other modestly capitalized shell
companies that are seeking to enter into business combinations with targets
similar to those we expect to pursue.





9




It
is likely that we will consummate a Business Combination with a private company
for which limited information will be available to conduct due
diligence.





We likely
will enter into a Business Combination with a privately-held
company.  Generally, very little public information exists about these
companies or their management and we will be required to rely on the ability of
our management to obtain adequate information to evaluate the potential success
of entering into a transaction with such a company.  In addition, our
management will only devote limited time to the business of the Company and will
have available to it extremely limited financial resources with which to conduct
due diligence.  If our assessment of the Target Business’s operations
and management is inaccurate or we are unable to uncover all material
information about these companies, then we may not make a fully informed
investment decision, and stockholders may lose their entire investment in our
Company.





If
we consummate a Business Combination by way of an acquisition, stockholders may
not have an opportunity to vote on the transaction.





If we
consummate a Business Combination by way of an acquisition of the capital stock
or assets of the Target Business, the transaction may be accomplished in the
sole determination of management without any vote or approval by our
securityholders.  Accordingly, stockholders at the time of any
Business Combination may not have an opportunity to evaluate the Target Business
or its management and will have to rely on the judgment of management in
assessing the future profitability and viability of the Target
Business.





A
Business Combination with a foreign company may subject us to additional
risks.





If we
enter into a Business Combination with a foreign entity, we will be subject to
all of the risks inherent in business operations outside of the United
States.  These risks include:





·
            unexpected
      changes in, or impositions of, legislative or regulatory
      requirements;


·
            foreign
      currency exchange rate
fluctuations;


·
            potential
      hostilities and changes in diplomatic and trade
    relationships;


·
            changes
      in duties and tariffs, taxes, trade restrictions, license obligations and
      other non-tariff barriers to trade;


·
            burdens
      of complying with a wide variety of foreign laws and
      regulations;


·
            longer
      payment cycles and difficulties collecting receivables through foreign
      legal systems;


·
            difficulties
      in enforcing or defending agreements and intellectual property
      rights;


·
            reduced
      protection for intellectual property rights in some
    countries;


·
            potentially
      adverse tax consequences; and


·
            political
      and economic instability.





If we are
not successful managing these risks among others that we may not identify at the
time of a Business Combination, our business may be negatively
impacted.





Since
we have not yet selected a particular industry or Target Business with which to
complete a Business Combination, we are unable to ascertain the merits or risks
of the industry or business in which we may ultimately operate at this
time.





We are
currently in the process of evaluating and identifying targets for a Business
Combination.  However, our plan of operation permits our board of
directors to consummate a Business Combination with a company in any industry it
chooses and is not limited to any particular industry or type of
business.  Accordingly, there is no current basis to evaluate the
possible merits or risks of the particular industry in which we may ultimately
operate or the Target Business that we may ultimately acquire.  To the
extent we complete a Business Combination with a company that does not have a
stable history of earnings and growth or an entity in a relatively early stage
of its development, we may be affected by numerous risks inherent in the
business operations of those entities.  If we complete a Business
Combination with an entity in an industry characterized by a high level of risk,
we may be affected by the currently unascertainable risks of that
industry.  Such risks, among other things, could preclude the
Company's ability to secure financing for operations after a Business
Combination, should it be required.  Although our management will
endeavor to evaluate the risks inherent in a particular industry or Target
Business, we cannot assure you that we will properly ascertain or assess all of
the significant risk factors.  Even if we properly assess those risks,
some of them may be outside of our control.





10





Our
long-term success will be dependent in large part upon the management team of
the Target Business, which may be difficult to fully evaluate.





After a
Business Combination, our long-term success we will be dependent upon the
management team of the Target Business.  Although we intend to
scrutinize the management team of a prospective Target Business as closely as
possible in connection with evaluating the desirability of affecting a Business
Combination, we cannot assure you that our assessment of the management team
will prove to be correct.  These individuals may be unfamiliar with
the complex disclosure and financial reporting requirements imposed on U.S.
public companies and other requirements of operating a public company, which
could divert their attention from their core business to the determent of the
operating results of the Target Business.





If
we are unable to structure the Business Combination as a “tax free” transaction,
potential Target Businesses could be deterred from entering into such a
transaction with our Company.





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.  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 and the respective stockholders of
each company; however, we cannot assure investors 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 affect on
all parties to the transaction.





The
Company may be subject to further government regulations which would adversely
affect our operations.





Although we are subject to the
reporting requirements of 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 will result in our holding passive investment interests in a
number of entities, we could be subject to regulations 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 received 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.





Limitations
on liability and indemnification matters.





As permitted by the corporate laws of
the State of Nevada, we have included in our articles of incorporation a
provision to eliminate the personal liability of our directors for monetary
damages for breach or alleged breach of their fiduciary duties as directors,
subject to certain exceptions, including, for example if the director did not
act in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful.  In addition, our bylaws provide that we are required to
indemnify our officers and directors under certain circumstances, including
those circumstances in which indemnification would otherwise be discretionary,
and we will be required to advance expenses to our officers and directors as
incurred in connection with proceedings against them for which they may be
indemnified.





11





Our
compliance with changing laws and rules regarding corporate governance and
public disclosure may result in additional expenses to us which, in turn, may
adversely affect our ability to continue our operations.




Keeping
abreast of, and in compliance with, changing laws, regulations and standards
relating to corporate governance and public disclosure, including the
Sarbanes-Oxley Act of 2002, new SEC regulations and, in the event we are ever
approved for listing on either an automated quotation system or a registered
exchange, and system or stock exchange rules, will require an increased amount
of management attention and external resources.  We intend to continue
to invest all reasonably necessary resources to comply with evolving standards,
which may result in increased general and administrative expenses and a
diversion of management time and attention from revenue-generating activities to
compliance activities.  This could have an adverse impact on our
operations.





We
expect to issue a significant number of new shares of capital stock in a
Business Combination, which will result in substantial dilution and a change in
control of ownership of the Company.





Our
articles of incorporation authorize the issuance of 100,000,000 shares of common
stock and 10,000,000 shares of preferred stock.  Any Business
Combination affected 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
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




We
may issue preferred stock which may have greater rights than our common
stock.




Our
Articles of Incorporation authorize our Company to issue up to 10,000,000 shares
of preferred stock. Currently, no preferred shares have been issued; however, we
can issue shares of our preferred stock in one or more series and can set the
terms of the preferred stock without seeking any further approval from our
common stockholders.  Any preferred stock that we issue may rank ahead
of our common stock in terms of dividend priority or liquidation premiums and
may have greater voting rights than our common stock.  In addition,
such preferred stock may contain provisions allowing those shares to be
converted into shares of common stock, which could dilute the value of common
stock to current stockholders and could adversely affect the market price, if
any, of our common stock.





There
are significant restrictions on the transferability of the Shares.





No outstanding shares of our common
stock have been registered under the Securities Act, and, consequently, they may
not be resold, transferred, pledged as collateral or otherwise disposed of under
federal securities laws unless such transaction is registered under the
Securities Act or an exemption from the registration requirements of the
Securities Act is available.  In connection with any transfer of
shares of our common stock other than pursuant to an effective registration
statement under the Securities Act, the Company may require the holder to
provide to the Company an opinion of counsel to the effect that such transfer
does not require registration under the Securities Act.  Persons who
acquired our common stock prior to a Business Combination will not be entitled
to rely on Rule 144 under the Exchange Act for the resale of our securities
unless and until (i) we cease to be a shell company, (ii) at the time of the
sale we are reporting under the Exchange Act, (iii) we have filed all Exchange
Act reports and material required to be filed during the preceding 12 months,
and (iv) at least one year has elapsed from the time that we file the disclosure
required by the SEC reflecting the fact that we are no longer a shell
company.  These restrictions will limit the ability of our
stockholders to liquidate their investment.





12




We
have not registered or qualified any shares of our class of our common stock for
resale under the Blue Sky laws of any state, which will limit the liquidity of
the common stock.





The
Company has not registered or qualified its class of common stock for resale or
trading under the Blue Sky laws of any state and current management does not
anticipate doing so.  Current stockholders and persons who desire to
purchase our common stock should be aware that significant state Blue Sky law
restrictions may limit our stockholders from selling their shares and potential
purchasers from acquiring our common stock.





The
absence of an established trading market will limit the ability of stockholders
to dispose of their common stock.





There is
currently no public trading market for any of our securities.  The
Company will not seek to list any of our securities on any exchange or have them
quoted on an automated quotation system or over-the-counter
market.  Any decision to initiate public trading of our common stock
will be in the discretion of management of a Target Company with which we
consummate a Business Combination.  Since stockholders will not be
able to sell their shares, stockholders should consider their liquidity needs
with respect to the securities and should be prepared to hold their shares for
an indefinite period.





We
cannot assure you that following a Business Combination with an operating
business, our common stock will be listed or admitted to quotation on any
securities exchange or other trading medium, which will limit the liquidity of
the shares.





Following
a Business Combination, new management may seek to initiate a public market for
our common stock.  However, we cannot assure you that following such a
transaction, our Company as then constituted will meet the initial listing
standards of any stock exchange or that our common stock will be admitted for
quotation on the over the counter bulletin board or commence trading on any
other medium.  If our common stock does not trade publicly, holders
may not be able to sell common stock.





The
designation of our common stock as a "penny stock" would limit the liquidity of
the shares.





Our
common stock after a Business Combination may be deemed a “penny stock” as that
term is defined under Rule 3a51-1 of the Exchange Act.  Generally, a
"penny stock" is a common stock that is not listed on a securities exchange and
trades for less than $5.00 a share.  Prices often are not available to
buyers and sellers and the market may be very limited.  Penny stocks
in start-up companies are among the riskiest equity
investments.  Broker-dealers who sell penny stocks must provide
purchasers of these stocks with a standardized risk-disclosure document prepared
by the SEC.  The document provides information about penny stocks and
the nature and level of risks involved in investing in the penny stock
market.  A broker must also provide purchasers with bid and offer
quotations and information regarding broker and salesperson compensation, make a
written determination that the penny stock is a suitable
investment for the purchaser and obtain the purchaser's written agreement to the
purchase. Many brokers choose not to participate in penny stock
transactions.  Because of the penny stock rules, there may be less
trading activity in penny stocks in any market that develops for our common
stock in the future and stockholders are likely to have difficulty selling their
shares.





FINRA
sales practice requirements may also limit a stockholder’s ability to buy and
sell our stock.




In
addition to the “penny stock” rules described above, the Financial Industry
Regulatory Authority (“FINRA”) has adopted rules that require that in
recommending an investment to a customer, a broker-dealer must have reasonable
grounds for believing that the investment is suitable for that
customer.  Prior to recommending speculative low priced securities to
their non-institutional customers, broker-dealers must make reasonable efforts
to obtain information about the customer’s financial status, tax status,
investment objectives and other information. Under interpretations of these
rules, the FINRA believes that there is a high probability that speculative low
priced securities will not be suitable for at least some
customers.  The FINRA requirements make it more difficult for
broker-dealers to recommend that their customers buy our common stock stocks in
any market that develops for our common stock in the future, which may limit the
ability to buy and sell our stock and which will have an adverse effect on any
market that develops for our shares.





13





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.  In the unlikely event we
generated profits prior to a Business Combination, we expect to retain such
earnings and re-invest them into the Company to further its business
strategy.





Item
1B. Unresolved Staff Comments.





Not
Applicable.





Item
2. Properties.





We
maintain our principal executive offices at 13406 Sir Britton Court,
Chesterfield, Virginia, where our President maintains a business
office.  We use this office space free of charge.  We
believe that this space is sufficient for our current requirements. The Company
does not own or lease any properties at this time and does not anticipate owning
or leasing any properties prior to the consummation of a Business Combination,
if ever.





Item
3. Legal Proceedings.





The
Company presently is not a party to, nor is management aware of, any pending,
legal proceedings.





Item
4. Removed and Reserved





PART
II





Item
5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities.





Market
Information





As of
October 11, 2010, there was one holder of record of 1,000,000 outstanding shares
of our common stock.





Our
common stock does not trade, nor is it admitted to quotation, on any stock
exchange or other trading facility.  Management has no present plan,
proposal, arrangement or understanding with any person with regard to the
development of a trading market in any of our securities.  Any
decision to initiate public trading of our common stock will be in the
discretion of management of a Target Company with which we consummate a Business
Combination.  We cannot assure you that a trading market for our
common stock will ever develop.  We have not registered our class of
common stock for resale under the blue sky laws of any state and current
management does not anticipate doing so.  The holders of shares of
common stock, and persons who may desire to purchase shares of our common stock
in any trading market that might develop in the future, should be aware that, in
addition to transfer restrictions imposed by federal securities laws,
significant state blue sky law restrictions may exist which could limit the
ability of stockholders to sell their shares and limit potential purchasers from
acquiring our common stock.





We are
not obligated by contract or otherwise to issue any securities and there are not
outstanding any securities that are convertible into or exchangeable for shares
of our common stock.





Shares
Available for Future Sale





All
outstanding shares of our common stock are “restricted securities,” as that term
is defined under Rule 144 promulgated under the Securities Act, because they
were issued in a private transaction not involving a public
offering.  Accordingly, none of the outstanding shares of our common
stock may be resold, transferred, pledged as collateral or otherwise disposed of
unless such transaction is registered under the Securities Act or an exemption
from registration is available.  In connection with any transfer of
shares of our common stock other than pursuant to an effective registration
statement under the Securities Act, the Company may require the holder to
provide to the Company an opinion of counsel to the effect that such transfer
does not require registration of such transferred shares under the Securities
Act.





14





Rule 144
is not available for the resale of securities initially issued by companies that
are, or previously were, shell companies, like us, unless the following
conditions are met:





·
            the
      issuer of the securities that was formerly a shell company has ceased to
      be a shell company;


·
            the
      issuer of the securities is subject to the reporting requirements of
      Section 13 or 15(d) of the Exchange
Act;


·
            the
      issuer of the securities has filed all Exchange Act reports and material
      required to be filed, as applicable, during the preceding 12 months (or
      such shorter period that the issuer was required to file such reports and
      materials), other than Current Reports on Form 8-K;
  and


·
            at
      least one year has elapsed from the time that the issuer filed current
      comprehensive disclosure with the SEC reflecting its status as an entity
      that is not a shell company.





Neither
the Company nor its officer and director has any present plan, proposal,
arrangement, understanding or intention of selling any unissued or outstanding
shares of common stock in the public market subsequent to a Business
Combination.  Nevertheless, in the event that a substantial number of
shares of our common stock were to be sold in any public market that may develop
for our securities subsequent to a Business Combination, such sales may
adversely affect the price for the sale of the Company's common stock securities
in any such trading market.  We cannot predict what effect, if any,
market sales of currently restricted shares of common stock or the availability
of such shares for sale will have on the market prices prevailing from time to
time, if any.





Dividends.





We have
not paid any dividends on our common stock to date and do not presently intend
to pay cash dividends prior to the consummation of a Business
Combination.





The
payment of any dividends subsequent to a Business Combination will be within the
discretion of our then seated board of directors.  Current management
cannot predict the factors which any future board of directors would consider
when determining whether or when to pay dividends.





Repurchases
of Equity Securities





None.





Recent
Sales of Unregistered Securities





The Company did not issue or sell any
securities during the fiscal year ended June 30, 2010.





Item
6. Selected Financial Data.





The
information to be furnished under this Item 6 is not required of smaller
reporting companies.





Item
7. Management’s Discussion and Analysis of Financial Condition and Results of
Operations.





. The following plan of operation
provides information which management believes is relevant to an assessment and
understanding of our results of operations and financial
condition.  The discussion should be read along with our financial
statements and notes thereto.  The following discussion and analysis
contains forward-looking statements which involve risks and
uncertainties.  Our actual results may differ significantly from the
results expectations and plans discussed in these forward-looking
statements





15




Plan
of Operation





We were
formed to serve as a vehicle to acquire, through a capital stock exchange,
reverse acquisition, reverse merger, asset acquisition or other similar business
combination, an operating or development stage business which desires to utilize
our status as a reporting corporation under the Exchange Act.  We have
neither engaged in any operations nor generated any revenues during the
twelve-month period ended June 30, 2010.





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 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.  There are numerous risks in connection with our current
and proposed operations and plans, including those enumerated under "Item 1A
Risk Factors."  By way of example, we will be affected by the risks
inherent in the business and operations of the Target Business and, if such
business is 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 be successful in our efforts to identify a Target Business and
consummate a Business Combination or that any business with which we consummate
a Business Combination will be successful





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, in order to ensure
that 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 as of the
      date of the transaction; and





·
            will
      cause a change in likely result in the resignation or removal of our
      management as of the date of the
transaction.





Our
management anticipates that the Company likely will be able to 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 concentrate the chance for our success into a single business
and 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.  Our cash on
hand will not be sufficient to cover our operating costs and expenses over the
next twelve months during which we anticipate that we will incur costs and
expenses in connection with the preparation and filing of reports under the
Exchange Act, the identification and evaluation of targets for a Business
Combination and, possibly, costs associated with negotiating and entering into a
Business Combination.





To date,
we have funded our operations through loans from our stockholder and, as of June
30, 2010, we had borrowed an aggregate of $22,177 from it, including $8,738
during the year then ended.  Our stockholder has advised us that it
expects to fund additional costs and expenses that we will incur in connection
with our operations, including as may be required to file reports under the
Exchange Act, for due diligence activities and to consummate 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 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."





16




Results
of Operations.





Since our
inception, we have not generated any revenues.  We reported a net loss
for the year ended June 30, 2010 of $10,403 and a have suffered a net loss since
inception of $27,039.  The Company has used cash in operations of
$22,272 since its inception, consisting primarily of professional fees, and has
a negative working capital of $26,939 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
7A. Quantitative and Qualitative Disclosures About Market Risk.





The
information to be furnished under this Item 7A is not required of smaller
reporting companies.





Item
8. Financial Statements and Supplementary Data.





FINANCIAL
STATEMENT INDEX








Report
      of Independent Registered Public Accounting Firm
              F-1Balance
      Sheets as of June 30, 2010 and 2009
              F-2Statements
      of Operations for the years ended June 30, 2010 and 2009and
      the period from May 7, 2008 (date of inception) to June 30,
      2010
              F-3Statement
      of Stockholder’s Deficit as of June 30, 2010
              F-4Statements
      of Cash Flows for the years ended June 30, 2010 and 2009and
      the period from May 7, 2008 (date of inception) to June 30,
      2010
              F-5Notes
      to Financial Statements
              F-6




17




Silberstein Ungar, PLLC CPAs and Business
      AdvisorsPhone
      (248) 203-0080
              Fax
      (248) 281-0940
              30600
      Telegraph Road, Suite 2175
              Bingham
      Farms, MI 48025-4586
              www.sucpas.com





REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the
Board of Directors of


Quality
Alliance Group, Inc.


Chesterfield,
VA





We have
audited the accompanying balance sheets of Quality Alliance Group, Inc. as of
June 30, 2010 and 2009, and the related statements of operations, stockholder’s
deficit, and cash flows for the years then ended and for the period from May 7,
2008 (date of inception) through June 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 has
determined that it 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 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 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 Quality Alliance Group, Inc. as of
June 30, 2010 and 2009, and the results of its operations and cash flows for the
years then ended and the period from May 7, 2008 (date of inception) through
June 30, 2010, in conformity with U.S. generally accepted accounting
principles.





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 6 to the financial
statements, the Company has negative working capital, has incurred operating
losses since inception, and has not received any revenue from sales of products
or services, and has incurred losses from operations.  These factors
raise substantial doubt about the Company’s ability to continue as a going
concern.  Management’s plans with regard to these matters are
described in Note 6.  The accompanying financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.





/s/ Silberstein Ungar,
PLLC





Silberstein
Ungar, PLLC


Bingham
Farms, Michigan


September
27, 2010




F-1





QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


BALANCE
SHEETS


AS
OF JUNE 30, 2010 AND 2009





2010
                    
                    
                    2009ASSETSCurrent
      AssetsCash
      and equivalents
                    
                    $
                    5
                    
                    
                    $
                    265TOTAL
      ASSETS
                    
                    $
                    5
                    
                    
                    $
                    265LIABILITIES
      AND STOCKHOLDER’S DEFICITCurrent
      LiabilitiesAccrued
      expenses and interest
                    
                    $
                    4,767
                    
                    
                    $
                    3,362Note
      payable – related party
                    
                    
                    22,177
                    
                    
                    
                    13,439Total
      current liabilities
                    
                    
                    26,944
                    
                    
                    
                    16,801Stockholder’s
      DeficitCommon
      Stock, $.0001 par value, 100,000,000 shares authorized, 1,000,000 shares
      issued and outstanding
                    
                    
                    100
                    
                    
                    
                    100Additional
      paid-in capital
                    
                    
                    0
                    
                    
                    
                    0Deficit
      accumulated during the development stage
                    
                    
                    (27,039
                    )
                    
                    
                    (16,636
                    )Total
      stockholder’s deficit
                    
                    
                    (26,939
                    )
                    
                    
                    (16,536
                    )TOTAL
      LIABILITIES AND STOCKHOLDER’S DEFICIT
                    
                    $
                    5
                    
                    
                    $
                    265





See
accompanying notes to financial statements.


F-2


QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENTS
OF OPERATIONS


FOR
THE YEARS ENDED JUNE 30, 2010 AND 2009


FOR
THE PERIOD FROM MAY 7, 2008 (INCEPTION) TO JUNE 30, 2010





Year ended
                  June 30, 2010
                
                
                Year ended
                  June 30, 2009
                
                
                Period from May
                  7, 2008
                  (Inception) to
                  June 30, 2010REVENUES
                
                $
                0
                
                
                $
                0
                
                
                $
                0EXPENSES:Professional
      fees
                
                
                8,998
                
                
                
                6,755
                
                
                
                24,753Interest
      expense
                
                
                1,405
                
                
                
                852
                
                
                
                2,286TOTAL
      EXPENSES
                
                
                10,403
                
                
                
                7,607
                
                
                
                27,039NET
      LOSS
                
                $
                (10,403
                )
                
                $
                (7,607
                )
                
                $
                (27,039
                )NET
      LOSS PER SHARE:BASIC
      AND DILUTED
                
                $
                (0.01
                )
                
                $
                (0.01
                )WEIGHTED
      AVERAGE SHARES OUTSTANDING:BASIC
      AND DILUTED
                
                
                1,000,000
                
                
                
                1,000,000





See
accompanying notes to financial statements.


F-3


QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENT
OF STOCKHOLDER’S DEFICIT


FOR
THE PERIOD FROM MAY 7, 2008 (INCEPTION) TO JUNE 30, 2010





Common stock
              
              
              Additional
                paid-in
              
              
              Deficit
                accumulated
                during the
                developmentShares
              
              
              Amount
              
              
              capital
              
              
              stage
              
              
              TotalIssuance
      of common stockfor
      cash @ $.0001
              
              
              1,000,000
              
              
              $
              100
              
              
              $
              -0-
              
              
              $
              -
              
              
              $
              100Net
      loss for the period ended June 30, 2008
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (9,029
              )
              
              
              (9,029
              )Balance,
      June 30, 2008
              
              
              1,000,000
              
              
              
              100
              
              
              
              -0-
              
              
              
              (9,029
              )
              
              
              (8,929
              )Net
      loss for the year ended June 30, 2009
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (7,607
              )
              
              
              (7,607
              )Balance,
      June 30, 2009
              
              
              1,000,000
              
              
              
              100
              
              
              
              -0-
              
              
              
              (16,636
              )
              
              
              (16,536
              )Net
      loss for the year ended June 30, 2010
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (10,403
              )
              
              
              (10,403
              )Balance,
      June 30, 2010
              
              
              1,000,000
              
              
              $
              100
              
              
              $
              -0-
              
              
              $
              (27,039
              )
              
              $
              (26,939
              )





See
accompanying notes to financial statements.


F-4


QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


STATEMENTS
OF CASH FLOWS


FOR
THE YEARS ENDED JUNE 30, 2010 AND 2009


FOR
THE PERIOD FROM MAY 7, 2008 (INCEPTION) TO JUNE 30, 2010





Year ended
                  June 30, 2010
                
                
                Year ended
                  June 30, 2009
                
                
                Period from
                  May 7, 2008
                  (Inception) to
                  June 30, 2010CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      loss for the period
                
                $
                (10,403
                )
                
                $
                (7,607
                )
                
                $
                (27,039
                )Change
      in non-cash working capital items:Increase
      in accrued expenses and interest
                
                
                1,405
                
                
                
                833
                
                
                
                4,767NET
      CASH (USED IN) OPERATING ACTIVITIES
                
                
                (8,998
                )
                
                
                (6,774
                )
                
                
                (22,272
                )CASH
      FLOWS FROM FINANCING ACTIVITIESProceeds
      from note payable
                
                
                8,738
                
                
                
                6,939
                
                
                
                22,177Proceeds
      from sales of common stock
                
                
                0
                
                
                
                0
                
                
                
                100NET
      CASH PROVIDED BY FINANCING ACTIVITIES
                
                
                8,738
                
                
                
                6,939
                
                
                
                22,277NET
      INCREASE (DECREASE) IN CASH
                
                
                (260
                )
                
                
                165
                
                
                
                5CASH,
      BEGINNING OF PERIOD
                
                
                265
                
                
                
                100
                
                
                
                0CASH,
      END OF PERIOD
                
                $
                5
                
                
                $
                265
                
                
                $
                5SUPPLEMENTAL
      CASH FLOW INFORMATIONInterest
      paid
                
                $
                -0-
                
                
                $
                -0-
                
                
                $
                -0-Income
      taxes paid
                
                $
                -0-
                
                
                $
                -0-
                
                
                $
                -0-





See
accompanying notes to financial statements.


F-5





QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


NOTES
TO THE FINANCIAL STATEMENTS


JUNE
30, 2010





NOTE
1 – SUMMARY OF ACCOUNTING POLICIES





Nature of
Business


Quality
Alliance Group, Inc. is a development stage company and was incorporated in
Nevada on May 7, 2008. The Company’s objective is to acquire or merge with
a target business or company in a business combination.





Development Stage
Company


The
accompanying financial statements have been prepared in accordance with
generally accepted accounting principles related to development-stage
companies.  A development-stage company is one in which planned
principal operations have not commenced or if its operations have commenced,
there has been no significant revenues there from.





Basis of
Presentation


The
financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States of America and are
presented in US dollars.





Accounting
Basis


The
Company uses the accrual basis of accounting and accounting principles generally
accepted in the United States of America (“GAAP” accounting).  The
Company has adopted a June 30 fiscal year end.





Cash and Cash
Equivalents


The
Company considers all highly liquid investments with maturities of three months
or less to be cash equivalents.  At June 30, 2010 and 2009 the Company
had $5 and $265 of unrestricted cash, respectively.





Fair Value of Financial
Instruments


The
Company’s financial instruments consist of cash and cash equivalents and accrued
expenses and interest. The carrying amount of these financial instruments
approximates fair value due either to length of maturity or interest rates that
approximate prevailing market rates unless otherwise disclosed in these
financial statements.





Income
Taxes


Income
taxes are computed using the asset and liability method.  Under the
asset and liability method, deferred income tax assets and liabilities are
determined based on the differences between the financial reporting and tax
bases of assets and liabilities and are measured using the currently enacted tax
rates and laws.  A valuation allowance is provided for the amount of
deferred tax assets that, based on available evidence, are not expected to be
realized.





Use of
Estimates


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





Revenue
Recognition


The
Company will recognize revenue when products are fully delivered or services
have been provided and collection is reasonably assured.





Basic Income (Loss) Per
Share


Basic
income (loss) per share is calculated by dividing the Company’s net loss
applicable to common shareholders by the weighted average number of common
shares during the period. Diluted earnings per share is calculated by dividing
the Company’s net income available to common shareholders by the diluted
weighted average number of shares outstanding during the year. The diluted
weighted average number of shares outstanding is the basic weighted number of
shares adjusted for any potentially dilutive debt or equity. There are no such
common stock equivalents outstanding as of June 30, 2010.





Stock-Based
Compensation


Stock-based
compensation is accounted for at fair value in accordance with SFAS No. 123 and
123 (R) (ASC 718).  To date, the Company has not adopted a stock
option plan and has not granted any stock options. As of June 30, 2010, the
Company has not issued any stock-based payments to its employees.




F-6




QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


NOTES
TO THE FINANCIAL STATEMENTS


JUNE
30, 2010





NOTE
1 – SUMMARY OF ACCOUNTING POLICIES (CONTINUED)





Recent Accounting
Pronouncements


The
Company does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on the Company’s results of
operations, financial position or cash flow.





NOTE
2 – ACCRUED EXPENSES AND INTEREST





Accrued
expenses and interest consisted of the following at June 30, 2010 and
2009:





2010
                  
                  
                  2009Accrued
      audit fees
                  
                  $
                  2,500
                  
                  
                  $
                  2,500Accrued
      interest – related party
                  
                  
                  2,267
                  
                  
                  
                  862Total
      accrued expenses and interest
                  
                  $
                  4,767
                  
                  
                  $
                  3,362





The
accrued interest – related party is owed to Ray Cene Investments,
LLC.  See Note 3.





NOTE
3 – NOTE PAYABLE – RELATED PARTY





The
Company received a $6,500 note payable from Ray Cene Investments, LLC on June
11, 2008.  The Company also signed an additional $3,500 note payable
on June 18, 2008 and received the funds on July 15,
2008.  Additionally, the Company was loaned funds during the year
ended June 30, 2009 totaling $3,439.





During
the year ended June 30, 2010 the Company received additional loans to fund
operations in the amounts of $4,742, $2,457 and $1,539. All notes are due on
demand and bear 8% interest.  Ray Cene Investments, LLC is the owner
of 100% of the outstanding common stock of the Company.  The total
note payable at June 30, 2010 and 2009 to Ray Cene Investments, LLC was $22,177
and $13,439, respectively.





NOTE
4 – COMMITMENTS AND CONTINGENCIES





Quality
Alliance neither owns nor leases any real or personal property. An officer has
provided office services without charge.  There is no obligation for
the officer to continue this arrangement.  Such costs are immaterial
to the financial statements and accordingly are not reflected
herein.  The officers and directors are involved in other business
activities and most likely will become involved in other business activities in
the future.


F-7




QUALITY
ALLIANCE GROUP, INC.


(A
DEVELOPMENT STAGE COMPANY)


NOTES
TO THE FINANCIAL STATEMENTS


JUNE
30, 2010




NOTE
5 – INCOME TAXES





For the
period ended June 30, 2010, the Company has incurred net losses of approximately
$10,400 and, therefore, has no tax liability.  The net deferred tax
asset generated by the loss carry-forward has been fully
reserved.  The cumulative net operating loss carry-forward is
approximately $27,000 at June 30, 2010, and will expire beginning in the year
2028.





The
provision for Federal income tax consists of the following:





2010
                  
                  
                  2009Refundable
      Federal income tax attributable to:Current
      Operations
                  
                  $
                  3,537
                  
                  
                  $
                  2,586Less:
      valuation allowance
                  
                  
                  (3,537
                  )
                  
                  
                  (2,586
                  )Net
      provision for Federal income taxes
                  
                  $
                  0
                  
                  
                  $
                  0





The
cumulative tax effect at the expected rate of 34% of significant items
comprising our net deferred tax amount is as follows:





2010
                  
                  
                  2009Deferred
      tax asset attributable to:Net
      operating loss carryover
                  
                  $
                  9,193
                  
                  
                  $
                  5,656Less:
      valuation allowance
                  
                  
                  (9,193
                  )
                  
                  
                  (5,656
                  )Net
      deferred tax asset
                  
                  $
                  0
                  
                  
                  $
                  0





Due to
the change in ownership provisions of the Tax Reform Act of 1986, net operating
loss carry forwards of $27,039 for Federal income tax reporting purposes are
subject to annual limitations. Should a change in ownership occur net operating
loss carry forwards may be limited as to use in future years.





NOTE
6 – LIQUIDITY AND GOING CONCERN




Quality
Alliance Group has negative working capital, has operating losses since
inception, and has not yet received revenues from sales of products or
services.  These factors create substantial doubt about the Company’s
ability to continue as a going concern.  The financial statements do
not include any adjustment that might be necessary if the Company is unable to
continue as a going concern.




The
ability of the Company to continue as a going concern is dependent on the
Company generating cash from the sale of its common stock and/or obtaining debt
financing and attaining future profitable operations.  Management’s
plans include selling its equity securities and obtaining debt financing to fund
its capital requirement and ongoing operations; however, there can be no
assurance the Company will be successful in these efforts.





NOTE
7 – SUBSEQUENT EVENTS





Management
has evaluated subsequent events through September 27, 2010 and has determined it
does not have any material subsequent events to disclose.


F-8





Item
9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure.





There are
not and have not been any disagreements between the Company and our independent
accountants on any matter of accounting principles, practices or financial
statement disclosure.





Item
9A. Controls and Procedures.





Evaluation
of Disclosure Controls and Procedures





As of the
end of the year covered by this Annual Report, management performed, with the
participation of our Principal Executive Officer, who is our Principal Financial
Officer, and who we refer to in this Annual Report as our PEO, an evaluation of
the effectiveness of our disclosure controls and procedures as defined in
Rules 13a-15(e) and 15d-15(e) of the Exchange Act.  Our
disclosure controls and procedures are designed to ensure that information
required to be disclosed in the reports we file or submit under the 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 our PEO, to allow timely decisions
regarding required disclosures.  Based on this evaluation, our PEO has
concluded that the Company’s disclosure controls and procedures were effective
as of June 30, 2010.





Management’s
Annual Report on Internal Control over Financial Reporting





Management
is responsible for establishing and maintaining adequate internal control over
financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act.  Internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements in accordance with
generally accepted accounting principles in the United States, or
GAAP.  A company’s internal control over financial reporting includes
those policies and procedures that: (i) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the Company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the Company are
being made only in accordance with authorizations of management of the Company;
and (iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of the Company’s
assets that could have a material effect on the consolidated financial
statements.





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





Management
assessed the effectiveness of our internal control over financial reporting as
of the end of the period covered by this report using the criteria set forth by
the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated
Framework.  Based on this evaluation, management concluded
that, as of June 20, 2010, the Company’s internal control over financial
reporting was effective.





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





Changes
in Internal Control over Financial Reporting





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





18





Item
9B. Other Information.





None.





PART
III





Item
10. Directors, Executive Officers and Corporate Governance.





The
following table lists our officers and directors as of the date of this
Registration Statement:





Name
              
              Age
              
              TitleAdam
      S. Wimmer
              
              32
              
              President
      and Director





Adam S.
Wimmer has been a member of the board of directors and the President of the
Company since its inception.  Since August 2003, Mr. Wimmer has been a
sales associate for Biomet, Inc., a designer and manufacturer of products for
the orthopedic, sports medicine, biologic and dental
markets.   During 2002 and 2003, he was an insurance agent for
Nationwide Insurance in Roanoke, Virginia.





The term of office of our director
expires at the Company's annual meeting of stockholders or until his successor
is duly elected and qualified.  Our director is not compensated for
serving as such.  Officers serve at the discretion of the Board of
Directors.





Section
16 Compliance





Section
16(a) of the Exchange requires officers, directors and persons who own more than
10% of a registered class of our equity securities of a company that has a class
of common stock registered under the Exchange Act to file reports of ownership
and changes in ownership with the Securities and Exchange Commission and to
furnish us with copies of all forms filed pursuant to Section
16(a).





Based
solely on a review of the copies of such reports furnished to us and written
representations from our sole officer and director that no other reports were
required, to our knowledge, we believe that our sole officer and director and
our principal stockholder who are required to file reports pursuant to Section
16(a) of the Exchange Act complied with all of the Section 16(a) filing
requirements applicable to them with respect to the last fiscal year, except
that the annual statements to report changes in beneficial ownership was filed
late.





Code
of Ethics.





The Company has not adopted a code of
ethics.  Given the nature of the Company’s business, its limited
stockholder base and current composition of management, the board of directors
does not believe that the Company requires a code of ethics at this
time.  The board of directors takes the position that management of a
Target Business will adopt a code of ethics that will be suitable for its
operations after the Company consummates a Business Combination.





Audit
Committee.





The board of directors has not
established an audit committee nor adopted an audit committee charter, rather,
the entire board of directors serves the functions of an audit
committee.  Given the nature of the Company’s business, its limited
stockholder base and current composition of management, the board of directors
does not believe that the Company requires an audit committee at this
time.  The board of directors takes the position that management of a
Target Business will make a determination as to whether to establish an audit
committee and to adopt an audit committee charter that will be suitable for its
operations after the Company consummates a Business Combination.





19





Stockholder
Communications.





The board
of directors has not adopted a process for security holders to send
communications to the board of directors.  Given the nature of the
Company’s business, its limited stockholder base and current composition of
management, the board of directors does not believe that the Company requires a
process for security holders to send communications to the board of directors at
this time.  The board of directors takes the position that management
of a Target Business will establish such a process that will be appropriate for
its operations after the Company consummates a Business
Combination.





Item
11. Executive Compensation.





The
Company has not paid any compensation to any person since inception and will not
pay any compensation until it affects a Business Combination, at which time
compensation shall be in the discretion of then current
management.  Current management expects to devote only such time to
the affairs of the Company as required to affect the Company’s business
plan.





The
Company has not adopted any retirement, pension, profit sharing, stock option or
insurance programs or other similar programs for the benefit of its
employees.





The
Company does not have a compensation committee.  Given the nature of
the Company’s business, its limited stockholder base and the current composition
of management, the board of directors does not believe that the Company requires
a compensation committee at this time.  The board of directors takes
the position that management of a Target Business will take such action to
establish and seat a compensation committee that will be suitable for its
operations at such time as the Company consummates a Business Combination, if
ever.





Item
12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters.





The table
below sets forth, as of  October 11, 2010, the number of shares of
common stock owned of record and beneficially by our sole officer and director
and the holder of more than 10% of number the outstanding shares of our common
stock.





The
applicable percentage of ownership is based on 1,000,000 shares
outstanding.  As of the date of this Report, there were no securities
outstanding convertible into or exercisable for shares of common
stock.





Name and Address
                  Of Beneficial Owner (1)
                
                Amount of
                  Beneficial Ownership
                
                
                Percent of Outstanding
                  Shares of Class Owned (2)Adam
      Wimmer
                
                
                -0-
                
                
                
                -0-Ray
      Cene Investments, LLC (3)
                
                
                1,000,000
                
                
                
                100
                %All
      officers and directors as a group (1 person)
                
                
                -0-
                
                
                
                -0-




(1) The
address for each of the persons named in the table above is c/o the
Company.


(2) Based
on 1,000,000 shares outstanding as of the date of this Report.


(3) The
outstanding interests of Ray Cene Investments, LLC ("Ray Cene") are owned as
follows: Elizabeth Wimmer, Adam Wimmer's wife, owns 25%; Lyle Wimmer, Adam
Wimmer's father, owns 40% and NSV, Inc., which is wholly owned by Steven
Chandler, owns 35%.  Pam McClanahan serves as the manager of Ray Cene
and all company actions (including as to voting and dispositive power over the
shares of Company stock owned by Ray Cene) are taken by the affirmative vote of
the holders of a majority of the outstanding interests.  Adam Wimmer
disclaims beneficial ownership of any interest in the shares of common stock
owned by Ray Cene.





20





Compensation
Plans.





We have not adopted any compensation
plans for the benefit of our employees, representatives or
consultants.  The Company does not have outstanding any options,
warrants or other rights outstanding that entitle anyone to acquire shares of
capital stock.





Item
13. Certain Relationships and Related Transactions, and Director
Independence.





Related
Party Transactions.





The
Company utilizes office space provided free of charge by Mr.
Wimmer.  The Company will continue to maintain its offices at this
location until the consummation of a Business Combination, if ever.





During the twelve months ended
June 30, 2010, the Company borrowed an aggregate of $8,738 from Ray Cene
Investments, LLC, an affiliated party.  Since inception, the Company
has borrowed an aggregate of $22,177 from its affiliates.  Each of the
loans is evidenced by a promissory note which is payable on demand with interest
calculated at the rate of —% per annum.  The proceeds from the loans
have been utilized by the Company to cover the costs and expenses incurred in
connection with the preparation and filing of Exchange Act reports and the
target entity selection and the due diligence process





Director
Independence.





The Company has not established its own
definition for determining whether its directors and nominees for directors are
“independent” nor has it adopted any other standard of independence employed by
any national securities exchange or inter-dealer quotation system.





Current
management cannot predict whether incoming management of a Target Business upon
the consummation of a Business Combination, if such transaction occurs, will
adopt a definition of “independence” or establish any committees of the board,
such as an audit committee, a compensation committee or nominating
committee.





Item
14. Principal Accounting Fees and Services.





AUDIT
FEES. The aggregate fees billed for professional services rendered by
Silberstein Ungar PLLC for the audits of the Company's annual financial
statements for the fiscal years ended June 30, 2010 and 2009 were $2,500 and
$2,500, respectively, and the reviews of the financial statements included in
the Company's Quarterly Reports on Form 10-Q for the fiscal years ended June 30,
2010 and 2009 were $1,500 and $1,500,
respectively        .





AUDIT-RELATED
FEES.  The aggregate fees billed by Silberstein Ungar PLLC for
audit-related services rendered for the Company for the last fiscal year were
$0.  Audit-related fees generally include fees in support of the
Company's filing of registration statements with the SEC and similar
matters.





TAX
FEES.  The aggregate fees billed by Silberstein Ungar PLLC for
tax-related services rendered for the Company for the last fiscal year were
$0.  .





ALL OTHER
FEES. The aggregate fees billed for services rendered to the Company by
Silberstein Ungar PLLC, other than the for the audit services referenced
above.





PRE-APPROVAL
POLICY. The Company has not established an audit committee nor adopted an audit
committee charter.  Rather, it is the responsibility of the entire
board of directors to serve the functions of an audit committee and to
pre-approve all audit and permitted non-audit services to be performed by the
independent auditors, such approval to take place in advance of such services
when required by law, regulation, or rule, subject to the de minimus exceptions
for non-audit services described in Section 10A(i)(1)(B) of the Exchange Act
that are approved by the board prior to completion of the audit.





21




PART
IV





Item
15. Exhibits, Financial Statement Schedules.





(a)
            Financial
      Statements





The
following financial statements are filed as part of this report:





Report
      of Independent Registered Public Accounting FirmBalance
      Sheets as of June 30, 2010 and 2009Statements
      of Operations for the Periods Ended June 30, 2010 and 2009and
      the Period from May 7, 2008 (date of inception) to June 30,
      2009Statement
      of Stockholder’s Deficit as of June 30, 2010Statements
      of Cash Flows for the Periods Ended June 30, 2010 and 2009and
      the Period from May 7, 2008 (date of inception) to June 30,
      2009Notes
      to Financial Statements





(b)           Exhibits.





The following are filed as exhibits to
this report:





Exhibit No.
                    
                    Description
                    
                    Location
                      Reference3.1
                    
                    Articles
      of Incorporation.
                    
                    13.2
                    
                    By-laws.
                    
                    110.1
                    
                    Form
      of demand promissory note in the principal amount of $6,500 dated June 11,
      2008 executed by the registrant in favor of Rey Cene Investments
      LLC.
                    
                    110.2
                    
                    Form
      of demand promissory note in the principal amount of $3,500 dated June 18,
      2008 executed by the registrant in favor of Rey Cene Investments
      LLC.
                    
                    223.1
                    
                    Consent
      of Independent Registered Accountant
                    
                    231.1
                    
                    Certification
      of Principal Executive Officer and Principal Financial Officer pursuant to
      Rule 13a-14 and Rule 15d 14(a), promulgated under the Securities and
      Exchange Act of 1934, as Amended.
                    
                    232.1
                    
                    Certification
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.
                    
                    2





1.
Incorporated by reference to the Company’s Registration Statement on Form 10 as
filed with the SEC on January 5, 2009.


2. Filed
herewith.





22





SIGNATURES





Pursuant to the requirements of
Section 13 or 15(d) of the Exchange Act, the Registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized on October 11, 2010.





QUALITY
      ALLIANCE GROUP, INC.By:
              /s/ Adam S. WimmerAdam
      S. Wimmer, President





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





Signature
                          
                          Title
                          
                          Date/s/ Adam S. Wimmer
                          
                          President,
      Principal Executive Officer, Principal Financial
                          
                          October
      11, 2010Adam
      S. Wimmer
                          
                          Officer,
      Principal Accounting Officer and Director





23