U.S. SECURITIES AND EXCHANGE
COMMISSION
 Washington, D.C.
20549
 FORM
10-K
 ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
 EXCHANGE
ACT OF 1934
 
 For the
fiscal year ended December 31, 2009
 Commission
file number:
000-31176
 
 SHELRON GROUP, INC.
 (Exact
name of registrant as specified in its charter)
 
 Delaware
                    
                    04-2968425(State
      of incorporation)
                    
                    (I.R.S.
      Employer Identification
No.)
 
 39
Broadway
 New York, New York
10006
 (Address
of principal executive offices)
 
 Tel:
(516) 620-6794
 (Registrant’s
telephone number, including area code)
 
 Securities
registered pursuant to Section 12(b) of the Exchange Act:
 None
 
 Securities
registered pursuant to Section 12(g) of the Exchange Act:
 Common
Stock, $0.001 par value
 
 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes  o
     No  x
 
 Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.  Yes  o
     No  x
 
 Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes x No o
 
 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. o
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 
 Large
      accelerated filer o
              
              Accelerated
      filer oNon-accelerated
      filer o
                (Do
      not check if a smaller reporting company)
              
              Smaller
      reporting company x
 
 Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act). Yes o No x
 
 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 computed second fiscal
quarter was $534,782.
 
 The
number of shares of the issuer’s common stock issued and outstanding as of April
12, 2010 was 18,477,492 shares.
 
 Documents
Incorporated By Reference:
 None
  
  TABLE
OF CONTENTS
 
 PagePART
      IItem
      1
                Business
                1Item
      1A
                Risk
      Factors
                4Item
      1B
                Unresolved
      Staff Comments
                4Item
      2
                Properties
                4Item
      3
                Legal
      Proceedings
                4Item
      4
                Submission
      of Matters to a Vote of Security Holders
                4PART
      IIItem
      5
                Market
      for Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity Securities
                5Item
      6
                Selected
      Financial Data
                6Item
      7
                Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operation
                6Item
      7A
                Quantitative
      and Qualitative Disclosures About Market Risk.
                10Item
      8
                Financial
      Statements.
                10Item
      9
                Changes
      in and Disagreements With Accountants on Accounting and Financial
      Disclosure
                10Item 9A
      (T)
                Controls and
      Procedures
                10Item
      9B
                Other
      Information
                12PART
      IIIItem
      10
                Directors,
      Executive Officers and Corporate Governance
                13Item
      11
                Executive
      Compensation
                15Item
      12
                Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
                15Item
      13
                Certain
      Relationships and Related Transactions, and Director
      Independence
                17Item
      14
                Principal
      Accountant Fees and Services
                17PART
      IVItem
      15
                Exhibits,
      Financial Statement Schedules
                18SIGNATURES
                
                19
  FORWARD
LOOKING STATEMENTS
 
 CERTAIN
STATEMENTS MADE IN THIS ANNUAL REPORT ON FORM 10-K ARE "FORWARD-LOOKING
STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995. FORWARD-LOOKING STATEMENTS CAN BE IDENTIFIED BY TERMINOLOGY SUCH AS
"MAY", "WILL", "SHOULD", "EXPECTS", "INTENDS", "ANTICIPATES", "BELIEVES",
"ESTIMATES", "PREDICTS", OR "CONTINUE" OR THE NEGATIVE OF THESE TERMS OR OTHER
COMPARABLE TERMINOLOGY. BECAUSE FORWARD-LOOKING STATEMENTS INVOLVE RISKS AND
UNCERTAINTIES, THERE ARE IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO
DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED BY THESE FORWARD-LOOKING
STATEMENTS. ALTHOUGH THE COMPANY BELIEVES THAT EXPECTATIONS REFLECTED IN THE
FORWARD-LOOKING STATEMENTS ARE REASONABLE, IT CANNOT GUARANTEE FUTURE RESULTS,
PERFORMANCE OR ACHIEVEMENTS. MOREOVER, NEITHER THE COMPANY NOR ANY OTHER PERSON
ASSUMES RESPONSIBILITY FOR THE ACCURACY AND COMPLETENESS OF THESE
FORWARD-LOOKING STATEMENTS. THE COMPANY IS UNDER NO DUTY TO UPDATE ANY
FORWARD-LOOKING STATEMENTS AFTER THE DATE OF THIS REPORT TO CONFORM SUCH
STATEMENTS TO ACTUAL RESULTS.
  
  PART
1
 
 ITEM
1. BUSINESS
 
 COMPANY
OVERVIEW
 
 Shelron
Group, Inc. is a company that develops and markets e-commerce advertising and
comparative shopping software products and services. We released our initial
product, ActiveShopper, in August 2004. ActiveShopper is a free software
download that automatically scans, locates and compares prices for an item that
a consumer selects at an e-commerce Web site and is designed to assist consumers
in making informed purchase decisions by enabling them to find the items they
are looking for, compare products, prices and stores, and buy from among
thousands of online merchants.
 
 At the
present time, we do not intend to actively promote our current ActiveShopper
product but will instead explore new opportunities in the
media/internet/high-tech fields. We are also considering strategic acquisitions
of synergistic technologies that management believes will enhance our market
positioning.
 
 On
October 1, 2009, we discontinued the operations and disposed of our research and
development subsidiary in Israel.
 
 We were
originally incorporated in the State of Massachusetts in June 1987, under the
name "Professional Brushes, Inc." In April 1999, we changed our state of
incorporation to Delaware by means of a merger with and into a Delaware company
and, in connection therewith, changed our name to "PB Acquisition Corp." In May
2000, we entered into a share exchange agreement with TTTTickets.com, Inc., a
Delaware corporation ("Tickets") incorporated in April 2000 for the purposes of
developing and maintaining an internet website for the sale and purchase of
event tickets, pursuant to which Tickets became a wholly owned subsidiary of our
company. We also changed our name to "TTTTickets Holding Corp." Thereafter, in
November 2001, we entered into a stock purchase and merger agreement with B-Park
Communications, Inc., ("B-Park") a Delaware corporation formed in August 2001
for the sole purpose of entering into such agreement.  In September
2002, we changed our name to "Shelron Group, Inc."
 
 We have
been engaged in the on-line shopping business since March 2004. Prior to that
time, we were engaged in the field of designing and developing business
applications software. We generate revenues primarily in the form of payments
from online merchants for directing traffic to their websites and managing
merchants advertising campaigns through ActiveShopper.
 
 In this
report, the terms "we," "us" and the "Company" refer to Shelron Group, Inc., its
predecessors, and subsidiary, unless the context indicates
otherwise.
 
 INDUSTRY
BACKGROUND
 
 When
online shopping emerged in the mid-1990s, there were just a handful of online
retailers, and thus, consumers could easily check the prices of products that
were sold on the Web by going from one store to the other and manually comparing
prices for a product. As e-commerce evolved, more and more online retailers
established businesses and more customers began to shop online and increase
their online spending. With more people and money being spent online in the
years 1998-2000, the simple task of going to a handful of online retailers and
checking the price became an unmanageable task.  At that same time,
the first Internet-based shopping comparison services emerged.
 
 Online
shopping comparison Web sites were established to help consumers manage the task
of shopping online by enabling them to find, compare, and buy products
conveniently and efficiently.  Generally speaking, they gather data
from online retailers, either by accessing merchant’s data feeds or using search
engine technology to “scrap” data off of merchant’s Web sites.  The
existing shopping comparison Web sites all offer quite similar
functionality.  Users search or browse for products that they desire
and then receive information about the product and the merchants that sell it,
including each merchant’s pricing. While these sites may offer extensive
information such as a review of the product, side-by-side comparison of a
product with similar products, etc., the most valued information is each
retailer’s pricing for each particular item they sell.
  1
  Shopping
comparison Web sites generate their revenue from one or more of the following
revenue streams:
 
 o
              Payments
      from merchants for directing traffic to their sites (Pay Per
      Click);o
              Payments
      from merchants when a directed customer actually buys a product in the
      merchant’s site (Pay Per Purchase); oro
              Other
      advertising activities on the comparison shopping service
      website.
 
 Pay Per
Click models are more common and the Pay Per Click revenue earned for directing
users to shopping website tends to be high, as these users tend to be
high-probability purchasers.
 
 Over the
years, little has changed in the way comparative shopping services function and
what they offer to their users. ActiveShopper offers simplicity to consumers
without providing complex mechanisms and comparison data, offered by most of
shopping comparison services, thereby protecting consumers better from
pseudo-attractive buying offers received by email and advertising
banners.
 
 SHELRON'S
COMPARATIVE SHOPPING PRODUCT
 
 Our
ActiveShopper software is a free software download that installs an invisible
shopping agent, a comparison shopping toolbar on the user’s Web browser and our
proprietary “Sidebar” product.  All three of these features are
integrated.  Once installed, the ActiveShopper software detects when a
user is visiting the Web site of any online retailer and then automatically
scans, locates and compares prices for the item that the consumer is shopping
for.
 
 ActiveShopper
is comprised of software components we purchased in March 2004.
 
 At the
present time, we do not intend to actively promote our current ActiveShopper
product but will instead explore new opportunities in the
media/internet/high-tech fields. We are also considering strategic acquisitions
of synergistic technologies that management believes will enhance our market
positioning.
  2
  OUR
STRATEGY
 
 We are
still offering our ActiveShopper software product but at the present time, we do
not intend to actively promote it but will instead explore new opportunities in
the media/internet/high-tech fields. We are also considering strategic
acquisitions of synergistic technologies that management believes will enhance
our market positioning.
 
 MARKETING
PLAN
 
 Historically,
our efforts have been devoted primarily to the design, development and testing
of ActiveShopper, as well as raising the capital needed to develop and maintain
our business. As a result of capital raises, our development and testing, as
well as, our marketing efforts have significantly increased in scope and
magnitude.
 
 We plan
to continue generating revenue principally from merchants in exchange of
directing traffic to their websites through ActiveShopper.
 Service
agreements or affiliation agreements with merchants have and may be further
reached directly or through third parties.
 
 We do not
intend to actively promote our ActiveShopper product but will instead explore
new opportunities in the media/internet/high-tech fields.
 
 PROPRIETARY
RIGHTS
 
 Protecting
our proprietary rights, such as our brand name and our proprietary technologies,
is critical to building consumer loyalty and attracting and retaining customers.
We seek to protect our proprietary rights through a combination of copyright,
trade secret, patent and trademark law, and contractual restrictions, such as
confidentiality agreements and proprietary rights agreements. We enter into
confidentiality and proprietary rights agreements with our service providers,
and generally control access to and distribution of our proprietary information.
Despite our efforts to protect our proprietary rights, unauthorized parties may
obtain and use our intellectual property, and we cannot be certain the steps we
have taken will prevent misappropriation or confusion among consumers and
merchants. If we are unable to procure, protect and enforce our intellectual
property rights, then we may not realize the full value of these assets, and our
business may suffer.
 
 On April
18, 2005, we entered into an agreement with Infospace, Inc. to purchase the
rights, title and interest of Infospace, Inc.'s U.S. and foreign trademarks,
trade names and service marks for "ActiveShopper" and the domain names
activeshopper.com, activeshopper.org, active-shop.com, active-shopper.com,
active-shopper.net and active-shopper.org.
 
 We do not
currently have any additional registered trademarks. We do not currently have
any patents on our technologies.
 
 COMPETITION
 
 The
market for advertising and comparative shopping software products and services
is highly competitive and we expect competition to intensify in the future. Our
competitors include Web sites such as Shopping.com, Shopzilla, PriceGrabber.com,
and DealTime.com. Many of our competitors have longer operating histories,
greater name recognition and significantly greater financial, technical, and
sales and marketing resources than we have. As a result, these competitors are
able to devote greater resources to the development, promotion, sale and support
of their products. In addition, these entities have large market capitalization
or cash reserves and are in a better position to acquire other companies in
order to gain new technologies or products. Many of our competitors also have
greater brand name recognition, more extensive customer bases, developed
distribution channels and broader product offerings than we do. These companies
can use their broad customer bases and product offerings and adopt aggressive
pricing policies with advertisers to gain market share.
  3
  EMPLOYEES
AND CONSULTANTS
 
 We
currently have one full time employee, who is our President. Our President also
currently serves as one of our three Directors.
 
 We
presently retain five professional service providers and consultants, who
provide services including, management, technical maintenance, marketing,
financial accounting and administration and public relations services. These
service providers and consultants may provide their services to us on a
full-time, part-time, or on demand basis.
 
 AVAILABLE
INFORMATION
 
 The
public may read and copy any materials we file with the Securities and Exchange
Commission ("SEC") at the SEC's Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. The public may obtain information on the operation of
the Public Reference Rooms by calling the SEC at 1-800-SEC-0330. The SEC also
maintains an Internet website that contains reports, proxy and information
statements and other information regarding issuers that file electronically with
the SEC. The SEC's Internet website is located at
http://www.sec.gov.
 
 Item
1A. Risk Factors
 
 Not
required for Smaller Reporting Companies.
 
 Item 1B.   Unresolved Staff
Comments
 
 None.
 
 ITEM
2. PROPERTIES.
 
 We do not
own any real property.
 
 We
maintain an office at 39 Broadway, New York, New York.  No rent is
charged for this space.  In April 2008, we terminated the lease of an
apartment in New York, NY, from an unaffiliated party for which we had paid
approximately $2,700 per month. We believe that our office space in the
United States is sufficient to meet our current and anticipated
needs.
 
 ITEM
3. LEGAL PROCEEDINGS.
 
 We are
not involved in any pending legal proceedings which we anticipate can result in
a material adverse effect on our business or operations.
 
 ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
 
 None.
  4
  PART
II
 
 Item
5.  Market for Registrant’s Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities.
 
 Market
Information
 
 The
Company's Common Stock is listed on the OTC Bulletin Board under the symbol
"SRNG". The following table sets forth the high and low bid information for the
Company's Common Stock for each quarterly period during the year ended December
31, 2009 and 2008 as reported by the OTC Bulletin Board. The OTC Bulletin Board
quotations reflect inter-dealer prices, are without retail markup, markdown or
commission, and may not represent actual transactions.  The prices
shown reflect a one for twenty-five reverse stock split which became effective
on October 20, 2008.
  High
                  
                  
                  LowCalendar
      Year 2009First
      Quarter
                  
                  $
                  0.020
                  
                  
                  $
                  0.013Second
      Quarter
                  
                  $
                  0.070
                  
                  
                  $
                  0.005Third
      Quarter
                  
                  $
                  0.040
                  
                  
                  $
                  0.004Fourth
      Quarter
                  
                  $
                  0.009
                  
                  
                  $
                  0.003Calendar
      Year 2008First
      Quarter
                  
                  $
                  0.100
                  
                  
                  $
                  0.030Second
      Quarter
                  
                  $
                  0.225
                  
                  
                  $
                  0.013Third
      Quarter
                  
                  $
                  0.225
                  
                  
                  $
                  0.018Fourth
      Quarter
                  
                  $
                  0.200
                  
                  
                  $
                  0.010
 
 HOLDERS
 
 At the
date of this filing there are approximately 364 holders of record of the
Company's Common Stock. This does not reflect those shares held beneficially or
those shares held in "street" name.
 
 DIVIDENDS
 
 Holders
of Common Stock and Series A Preferred Stock are entitled to dividends, when,
as, and if declared by our Board of Directors, out of funds legally available
therefore. Except for a stock dividend distribution in August 2003 of 406,357
shares of its Common Stock, we have paid no dividends in any form  on
the Common Stock or Series A Preferred Stock and do not expect to pay cash
dividends in the foreseeable future with respect to the Common Stock or Series A
Preferred Stock.
 
 It is the
present policy of our Board of Directors to retain all earnings to provide funds
for our growth. The declaration and payment of dividends in the future will be
determined by our Board of Directors based upon our earnings, financial
condition, capital requirements and such other factors as our Board of Directors
may deem relevant. We are not under any contractual restriction as to our
present or future ability to pay dividends.
 
 EQUITY
COMPENSATION PLAN INFORMATION
 
 We do not
have any existing option or equity compensation plans.
 
 Purchases
of Equity Securities by the Small Business Issuer and Affiliated
Purchasers
  We have
not repurchased any shares of our common stock during the fiscal years ended
December 31, 2009 and 2008.
  5
  Item 6.   Selected Financial
Data.
 
 Not
applicable.
 
 ITEM
7. MANAGEMENT'S DISCUSSION AND ANALYSIS
 
 FORWARD-LOOKING
STATEMENTS
 
 THE
FOLLOWING DISCUSSION AND EXPOSITIONS SHOULD BE READ IN CONJUNCTION WITH OUR
FINANCIAL STATEMENTS AND THE NOTES RELATED TO THOSE STATEMENTS, AS WELL AS OTHER
FINANCIAL INFORMATION INCLUDED IN THIS ANNUAL REPORT. SOME OF OUR DISCUSSION IS
FORWARD-LOOKING AND INVOLVES RISKS AND UNCERTAINTIES. FOR INFORMATION REGARDING
RISK FACTORS THAT COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS, REFER TO
RISKS ASSOCIATED WITH OUR BUSINESS SECTION OF THIS ANNUAL REPORT.
  OVERVIEW
 
 We
develop e-commerce advertising and comparative shopping software products and
services. At the present time, the Company does not intend to actively promote
its current ActiveShopper product but will instead explore new opportunities in
the media/internet/high-tech fields.
 
 We
released our initial product, ActiveShopper, in August 2004. ActiveShopper is a
free software download that automatically scans, locates and compares prices for
an item that a consumer selects at an e-commerce Web site and is designed to
assist consumers in making informed purchase decisions by enabling them to find
the items they are looking for, compare products, prices and stores, and buy
from among thousands of online merchants.
 
 We have
been engaged in the on-line shopping business since March 2004. Prior to that
time, we were engaged in the field of designing and developing business
applications software.
 
 We
generate revenues primarily from merchants for directing traffic to their
websites and managing merchants advertising campaigns through
ActiveShopper.
 
 We
presently generate revenues primarily according to pay-per-click models
resulting from directing traffic to merchants’ websites. We also generate
revenues according to pay-per-sale (pay-per-purchase) model which pay us a
commission on any sale resulting from the directing of traffic to a merchant
website. We also generate revenue from consulting and management of advertising
campaigns through ActiveShopper.
 
 On
October 1, 2009 we discontinued the operations and disposed of our research and
development subsidiary in Israel. The operating results of this subsidiary are
classified as discontinued operations in the statement of
operations.
  6
  CRITICAL
ACCOUNTING POLICIES AND ESTIMATES
 
 Our
financial statements and related public financial information are based on the
application of accounting principles generally accepted in the United States
(“GAAP”). GAAP requires the use of estimates; assumptions, judgments and
subjective interpretations of accounting principles that have an impact on the
assets, liabilities, revenue and expense amounts reported. These estimates can
also affect supplemental information contained in our external disclosures
including information regarding contingencies, risk and financial condition. We
believe our use if estimates and underlying accounting assumptions adhere to
GAAP and are consistently and conservatively applied. We base our estimates on
historical experience and on various other assumptions that we believe to be
reasonable under the circumstances. Actual results may differ materially from
these estimates under different assumptions or conditions. We continue to
monitor significant estimates made during the preparation of our financial
statements.
 
 We do not
participate in, nor have we created, any off-balance sheet special purpose
entities or other off-balance sheet financing.
 
 We have
identified the accounting policies below as critical to our business operations
and the understanding of our results of operations.
 
 Functional Currency - The
majority of Company’s sales are in United States dollars. In addition, the
majority of the Company’s investing and financing activities are in United
States dollars. Accordingly, the Company has determined the United States dollar
as the currency of its primary economic environment and thus, its functional and
reporting currency. Non-dollar transactions and balances have been measured in
United States dollars in accordance with Financial Accounting Standards Board
(“FASB”) Accounting Standards Codification (“ASC”) 830, “Foreign Currency
Matters.”  All transaction gains and losses from the measurement of
monetary balance sheet items denominated in non-dollar currencies are reflected
in the statement of operations as financial income or expenses, as
appropriate.
 
 Intangible Assets - Intangible
assets are carried at cost less accumulated amortization. Amortization is
computed on the straight-line method over the estimated useful lives of the
assets. We periodically review the carrying value of our intangible assets to
determine whether impairment may exist under the provisions of FASB ASC 360,
“Property, Plant and Equipment.” We consider relevant cash flow and
profitability information, including estimated future operating results, trends
and other available information, in assessing whether the carrying value of the
intangible assets can be recovered. If it is determined that the carrying value
of the intangible assets will not be recovered from the undiscounted future cash
flows, the carrying value of the assets would be considered impaired. An
impairment charge is measured as any deficiency in the amount of estimated fair
value of the intangible assets over carrying value.
 
 Revenue Recognition - The
Company's revenue derives from service revenue and the management of advertising
campaigns, both of which are related to ActiveShopper.
 
 Service
revenue primarily derives from the implementation of partnership agreements
according to which the Company provides a service of directing traffic to
merchants' websites. Service revenue is primarily based on a pay-per-click
model, reported at their net values to the Company, which represent the revenues
the Company is entitled to receive according to the partnership agreements. In
order to recognize service revenue, the following criteria must be met: (i) the
partnership agreement must be signed by the customer, (ii) the signed agreement
must specify the fees to be received for the services, (iii) the service has
been performed and accepted by the customer, (iv) no significant Company
obligations remain and (v) collectability is probable.
 
 Management
of advertising campaign revenues primarily relates to advertising through
ActiveShopper websites. In order to recognize management of advertising
campaigns revenue, the following criteria must be met: (i) an agreement must be
signed by the customer, (ii) the signed agreement must specify the fees to be
received, (iii) consultancy and management have been provided and accepted by
the customer, (iv) no significant Company obligations remain and (v)
collectability is probable.
 
 When the
above stated revenue recognition criteria are not met, the Company records
deferred revenue.
  7
  RESULTS
OF OPERATIONS
 
 Comparison
of the Year Ended December 31, 2009 (the "2009 Period") and the Year Ended
December 31, 2008 (the "2008 Period"):
 
 Continuing
Operations
 
 Revenues
and Major Customers
 
 Revenues
are from our ActiveShopper software. The decrease in revenues of $44,369 or
98.0% is attributable to the change in the Company’s strategy. As discussed in
Item 1 above, during 2009, we did not actively promote our current ActiveShopper
product. Instead, we explored new opportunities in the media/internet/high-tech
fields. We also considered strategic acquisitions of synergistic technologies
that management believes will enhance our market positioning. In addition, on
October 1, 2010, we discontinued the operations of our subsidiary.
 
 Operating
Expenses
 
 Operating
expenses consist of salaries, consulting expenses, research and development,
marketing and advertising and other expenses associated with the operations of
our business. For the 2009 Period, operating expenses were $273,626, a decrease
of 38.1%, as compared to $442,313 for the 2008 Period.  The decrease
is primarily a result of the Company’s change in strategy as discussed
above.  The decrease is mainly attributable to the marketing and
advertising reimbursement in the 2009 Period of $6,083, as compared to an
expense of $60,589 in the 2008 Period or a decrease of $66,672, a decrease in
consulting fees of $50,430 and office and general expenses of $41,428 as
compared to the 2008 Period.
 
 Consulting
Expenses
 
 For the
2009 Period, consulting fees were $24,129, a decrease of 67.6% as compared to
$74,559 for the 2008 Period. The decrease was primarily due to the Company's
decision to reduce the service by its consultants and the cancellation of grant
of shares.
 
 Employment
Compensation
 
 Our sole
full-time employee is our Chairman of the Board, Eliron Yaron.  For
the 2009 Period and 2008 Period, employment compensation totaled $163,104 and
$158,368, respectively an increase of $4,736.
 
 Professional
Fees
 
 Professional
fees consist primarily of legal, accounting and auditing. For the 2009 Period,
professional fees were $38,000, a decrease of 14.6% as compared to $44,495 for
the 2008 Period. The decrease in professional fees is primarily due to lower
audit and legal fees during the 2009 Period.
 
 Marketing
and Advertising
 
 For the
2009 Period, marketing and advertising reimbursement expenses, net were
$(6,083). For the 2008 Period, marketing and advertising expenses were $60,589.
The reimbursement in 2009 is due to the reversal of charges incurred in previous
years.
 
 Rent
Expense
 
 For the
2009 Period, rent expense was $0 as compared to $10,991 for the 2008 Period. The
decrease in rent expense is attributable to the termination in April 2008 of an
office in New York.
  8
  Impairment
of Intangible Asset
 
 During
the 2009 Period, we changed our strategy and are no longer actively promoting
our current ActiveShopper product.  As a result our intangible asset
related to our ActiveShopper name became impaired and we recorded an impairment
loss of $22,000 during the period.
 
 Discontinued
Operations
 
 On
October 1, 2010, we discontinued the operations and disposed of our subsidiary.
The operations for our discontinued subsidiary resulted in a net loss of $42,774
and $30,091 for the years ended December 31, 2009 and 2008, respectively. The
operating results of this subsidiary are classified as discontinued operations
in the statements of operations. The total of the assets and liabilities
disposed was $121,190 and $188,702, respectively.  We recorded a gain
on the disposition of our subsidiary in the amount of $67,512.
 
 LIQUIDITY
AND CAPITAL RESOURCES
 
 To date,
we have financed our operations primarily from cash generated through the sale
of our Common Stock in private placements as well as from cash earned from our
operations.
 
 As of
December 31, 2009, we had a cash balance of $282 and accounts receivable of
$895.
 
 Cash used
in operating activities from continuing operations was $242,267 for 2009
compared to $70,480 for 2008. The decrease in the operating cash used for the
2009 Period is primarily attributable to the cash needed to fund the loss for
the 2009 Period.
 
 Cash
provided by financing activities in the 2009 Period was $52,195 compared to
$175,000 for the 2008 Period. In the 2009 Period and 2008 Period, the Company
received proceeds of $52,195 and $110,000, respectively, from Eliron Yaron, our
President, for investments in the Company’s common stock. In July 2008, the
Company issued 200,000 shares of common stock to an investor under a Shares
Purchases Agreement and received proceeds of $15,000. In addition, in 2008, the
Company received proceeds of $50,000 for a note payable issued for working
capital purposes.
 
 Net cash
(used in) provided by discontinued operations amounted to $(29,326) in the 2009
Period and $(16,638) in the 2008 Period.
 
 At the
present time, the Company does not intend to actively promote its current
Activeshopper product but will instead explore new opportunities in the
media/internet/high-tech fields.
 
 The focus
of the Company’s efforts is to acquire or develop an operating business. Despite
limited active operations at this time, management intends to continue in
business and has no intentions to liquidate the Company. The Company has
considered various business alternatives including the possible acquisition of
an existing business. The Company does not contemplate limiting the scope of its
search to any particular industry but we focus in the media and ecommerce
business. Management has considered the risk of possible opportunities as well
as their potential rewards. Management has invested time evaluating proposals
for possible acquisitions or combinations; however, at this time, none of these
opportunities have been pursued. The Company’s primary continuing expected
expenses are comprised primarily of employment compensation and professional
fees.
 
 The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As shown in the accompanying financial statements,
the Company has incurred losses of $251,742 in the 2009 Period, and a working
capital deficiency of $(583,644) as of December 31, 2009, which raises
substantial doubt about the Company’s ability to continue as a going
concern.
 
 The
Company is currently dependent on its President, Mr. Yaron, to continue to fund
the Company. If the Company is unable to acquire or develop an operating
business the Company will be unable to fund itself. There is no guarantee that
Mr. Yaron will continue to fund the Company.
 
 On March
30, 2010, Mr. Yaron agreed to increase his investment in the Company by
contributing 200,000 shares of stock of a publicly traded Over-The-Counter
Bulletin Board company.  On March 30, 2010 the shares to be
contributed had a value of $64,000 based on the closing price per share of the
stock on such day.  There is no guarantee that the shares will be
valued at the same price on the actual day they are contributed and they may be
valued at a higher or lower price on that day.
  9
  Management
believes the Company will continue to incur losses and negative cash flows from
operating activities for the foreseeable future and will need additional equity
or debt financing to sustain its operations until it can achieve profitability
and positive cash flows, if ever. The Company’s continuation as a going concern
is dependent upon its ability to ultimately attain profitable operations,
generate sufficient cash flow to meet its obligations, and obtain additional
financing as may be required. The outcome of this uncertainty cannot be assured.
Our independent registered public accounting firm, in their reports on our
financial statements for the years ended December 31, 2009 and 2008, expressed
substantial doubt about our ability to continue as a going concern. These
circumstances could complicate our ability to raise additional capital. Our
financial statements do not include any adjustments to the carrying amounts of
our assets and liabilities that might result from the outcome of this
uncertainty.
 
 The
accompanying consolidating financial statements do not include any adjustments
that might result from the outcome of this uncertainty. There can be no
assurance that management will be successful in implementing its business plan
or that the successful implementation of such business plan will actually
improve the Company's operating results.
  OFF-BALANCE
SHEET ARRANGEMENTS
  None.
  TABULAR
DISCLOSURE OF CONTRACTUAL OBLIGATIONS
 
 Consulting
Agreement dated as of March 1, 2005 between the Company and Hull Services,
Inc.
 
 Item
7A.  Quantitative and Qualitative Disclosures About Market
Risk.
 
 Not
applicable.
 
 ITEM
8. FINANCIAL STATEMENTS
 
 The
financials statements of our company for the years ended December 31, 2009 and
2008 are attached hereto following the signature page commencing on page
F-1.
 
 ITEM 9. CHANGES IN AND DISAGREEMENTS
WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
 
 None.
 
 Item
9A (T).  Controls and Procedures.
 
 Evaluation
of Effectiveness of Disclosure Controls and Procedures
 
 Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out a formal evaluation of the effectiveness of the
Company’s disclosure controls and procedures (as defined under Rule 13a-15(e)
under the Exchange Act) as of the end of the period covered by this report. The
Company’s Chief Executive Officer, who also acts in the capacity of Chief
Financial Officer, has concluded that the Company’s disclosure controls and
procedures were ineffective ensure that information required to be disclosed by
the Company in the reports that the Company files or submits 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 the Company’s management, to allow timely decisions
regarding required disclosure. The reasons for this conclusion is stated
below.
  10
  Our
internal controls over financial reporting are designed by, or under the
supervision of, our Chief Executive Officer, or persons performing similar
functions, and effected by our board of directors, management and other
personnel, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. Our
internal control over financial reporting includes those policies and procedures
that:
 
 - Pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets.
 
 - Provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles, and that our receipts and expenditures are being made
only in accordance with authorizations of our management and directors;
and
 
 - Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect
on the financial statements.
 
 This
annual report does not include an attestation report of Shelron’s registered
public accounting firm regarding internal control over financial reporting.
 Management's report was not subject to attestation by Shelron’s registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit Shelron to provide only management's report in
this annual report.
 
 Management’s
Report on Internal Control Over Financial Reporting
 
 Our Chief
Executive Officer, is responsible to design or supervise a process to be
effected by our board of directors that provides reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles. It is management’s responsibilities to establish and
maintain adequate internal controls over the Company’s financial
reporting.
 
 The
policies and procedures include:
 
 -
Maintenance of records in reasonable detail to accurately and fairly reflect the
transactions and dispositions of assets,
 
 - Review
and authorization by management for all receipts and expenditures,
 
 -
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 are being made only in
accordance with authorizations of management and directors, and
 
 -
Reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of assets that could have a material effect on
our financial statements.
 
 Management,
with the participation of our Chief Executive Officer, evaluated the
effectiveness of our internal controls over financial reporting based upon the
framework provided by the Treadway Commission’s Committee of Sponsoring
Organizations. The Company’s Chief Executive Officer, who also acts in the
capacity of Chief Financial Officer, has concluded that the Company’s internal
controls over financial reporting were effective as of the end of the
period covered by the Report.
  11
  Changes
in Internal Control Over Financial Reporting
 
 There
have been no changes in our internal control over financial reporting (as
defined in Exchange Act Rule 13a-15(f)) during the year ended December 31, 2008
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.
 
 LIMITATIONS
OF EFFECTIVENESS OF INTERNAL CONTROLS
 
 Management
does not expect that our disclosure controls and procedures or our internal
control over financial reporting will necessarily prevent all fraud and material
errors. An internal control system, no matter how well conceived and operated,
can provide only reasonable, not absolute, assurance that the objectives of the
control system are met. Further, the design of a control system must reflect the
fact that there are resource constraints, and the benefits of controls must be
considered relative to their costs. Because of the inherent limitations on all
internal control systems, no evaluation of controls can provide absolute
assurance that all control issues and instances of fraud, if any, within the
Company have been detected. These inherent limitations include the realities
that judgments in decision-making can be faulty, and that breakdowns can occur
because of simple error or mistake. The design of any system of internal control
is also based in part upon certain assumptions about the likelihood of future
events, and there can be no assurance that any design will succeed in achieving
its stated goals under all potential future conditions. Over time, controls may
become inadequate because of changes in circumstances, and/or the degree of
compliance with the policies and procedures may deteriorate. Because of the
inherent limitations in a cost effective internal control system, financial
reporting misstatements due to error or fraud may occur and not be detected on a
timely basis.
 
 Item 9B.   Other
Information.
 
 None.
  12
  PART
III
 
 ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
 
 The
following table sets forth information concerning our Directors and Executive
Officer:
 
 Name
                  
                  Age
                  
                  Positions and Offices
  HeldEliron
      Yaron
                  
                  42
                  
                  Chairman,
      Chief Executive Officer, Principal Financial And Accounting Officer,
      Director and SecretaryIssac
      Maizel
                  
                  30
                  
                  DirectorYossi
      Levi
                  
                  30
                  
                  Director
 
 Eliron
Yaron, age 42, has been the Chairman of our Board of Directors, Principal
Executive Officer and Principal Financial and Accounting Officer since company's
inception date in August 2001. Prior to joining us, from 1996 through 2001, he
was the founder and Chief Executive Officer of Shelron Internet Ltd., a web
project oriented company. Prior to that time, since 1993, he has engaged in
either founding web related business or working in related technology areas.
Eliron Yaron has served on the boards of Internet companies in the US and
Israel, and has advised venture capital funds and investment companies on IT and
Internet related investments and marketing.
 
 Isaac
Maizel, age 30, has worked since 2001 as a computer network consultant, with an
expertise in large networks implementation.
 
 Yossi
Levi, age 30, worked since 2001 as an E-learning consultant, and as an internet
advertising salesman.
 
 THE
COMMITTEES
 
 The Board
of Directors does not have a Compensation, Audit or Nominating Committee, and
the usual functions of such committees are currently performed by the Board of
Directors. The Directors have determined that at present we do not have an audit
committee financial expert. The Directors believe that they are capable of
analyzing and evaluating our financial statements and understanding internal
controls and procedures for financial reporting. In addition, we have been
seeking and continue to seek appropriate individuals to serve on the Board of
Directors and the Audit Committee who will meet the requirements necessary to be
an independent financial expert.
 
 EXECUTIVE
OFFICERS OF OUR COMPANY
 
 Officers
are appointed to serve at the discretion of the Board of Directors. Mr. Eliron
Yaron currently serves as our Chairman of the Board and sole Executive
Officer.
 
 CODE
OF ETHICS
 
 We
adopted a code of ethics that applies to our Principal Executive Officer and
Principal Financial and Accounting Officer, and other persons who perform
similar functions. A copy of our Code of Ethics is filed as an exhibit to the
Annual Report on Form 10-KSB for the year ended December 31,
2003.  Our Code of Ethics is intended to be a codification of the
business and ethical principles which guide us, to deter wrongdoing, promote
honest and ethical conduct, avoid conflicts of interest, and foster full, fair,
accurate, timely and understandable disclosures, compliance with applicable
governmental laws, rules and regulations, the prompt internal reporting of
violations and accountability for adherence to this Code.
  13
  SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 
 Section
16(a) of the Exchange Act requires the Company's Executive Officers, Directors
and persons who beneficially own more than 10% of a registered class of the
Company's equity securities to file with the Commission initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Such persons are required by Commission regulations
to furnish the Company with copies of all Section 16(a) forms they filed. Based
solely upon a review of (i) Forms 3 and 4 and amendments
thereto  furnished to the Company pursuant to Rule 16a-3(e),
promulgated under the Securities Exchange Act of 1934 (the "Exchange Act"),
during the Company's fiscal year ended December 31, 2009, and (ii) Forms 5 and
amendments thereto and/or written representations furnished to us by any
Director, officer or 10% security holder of the Company (collectively "Reporting
Persons") stating that he or she was not required to file a Form 5 during the
Company's fiscal year ended December 31, 2009, it has been determined that all
Officers, Directors and persons who beneficially own more than 10% of a
registered class of the Company's equity securities have met their reporting
obligations set forth in Section 16(a) of the Exchange Act.
 
 Potential
Conflicts of Interest
  Since we
do not have an audit or compensation committee comprised of independent
directors, the functions that would have been performed by such committees are
performed by our directors. The Board of Directors has not established an audit
committee and does not have an audit committee financial expert, nor has the
Board established a nominating committee. The Board is of the opinion that such
committees are not necessary since the Company has only three directors, and to
date, such directors have been performing the functions of such committees.
Thus, there is a potential conflict of interest in that our directors and
officers have the authority to determine issues concerning management
compensation, nominations, and audit issues that may affect management
decisions. We are not aware of any other conflicts of interest with any of our
executive officers or directors.
  Involvement
in Certain Legal Proceedings
 
 There are
no legal proceedings that have occurred within the past five years concerning
our directors, or control persons which involved a criminal conviction, a
criminal proceeding, an administrative or civil proceeding limiting one's
participation in the securities or banking industries, or a finding of
securities or commodities law violations.
  14
  ITEM
11. EXECUTIVE COMPENSATION
 
 The
Summary Compensation Table below sets forth compensation paid by the Company for
the fiscal years ended December 31, 2009 and 2008 for services to its Principal
Executive Officer and other Executive Officers who received a total annual
salary and bonus which exceeded $100,000.
  SUMMARY COMPENSATION TABLENAME
      AND
                                                  
                                                  
                                                  ANNUAL
      AND TOTALPOSITION
                                                  YEAR
                                                  
                                                  COMPENSATIONEliron
      Yaron,Chairman,
      Principal Executive
                                                  2009
                                                  
                                                  $
                                                  163,104Officer
      and Principal Financial
                                                  2008
                                                  
                                                  $
                                                  174,403
                                                  (1)And
      Accounting Officer
 
 (1)
Includes $16,035 of compensation paid by the Company's subsidiary in
Israel.
 
 Mr. Yaron
did not receive a bonus or any type of other compensation, not mentioned above,
for the three years presented.
 
 OPTION
GRANTS IN 2009
 
 None of
the Named Executive Directors were granted any options during the year ended
December 31, 2009.
 
 AGGREGATE
OPTIONS EXERCISED IN 2009 AND 2008 YEAR END VALUES
 
 Not
applicable.
 
 EQUITY
COMPENSATION PLAN INFORMATION
 
 Not
applicable.
 
 EXECUTIVE
EMPLOYMENT
 
 In March
2005, we entered into a Consulting Agreement ("Consulting Agreement") with Hull
Services Inc. ("Hull"), a company wholly-owned and controlled by Eliron Yaron,
the Chairman of the Board of Directors and the Principal Executive Officer of
the Company. Pursuant to the terms of this Consulting Agreement, we pay to Hull
$156,000 per annum in installments of $3,000 per week for Mr. Yaron’s services,
in addition to reimbursing all reasonable expenses incurred in connection with
services rendered on behalf of our Company. The compensation accrues and is paid
when funds for such payments are available. As of December 31, 2009, accrued and
outstanding fees to Hull are $291,152. The Consulting Agreement continues in
effect through March 2010 and contains certain customary confidentiality and
non-compete provisions. The Consulting Agreement is renewed automatically for
successive one year periods until either party gives the other a 180-day prior
written notice of its intent to terminate the Consulting Agreement. As of
December 31, 2009, no prior written notice with the intent to terminate the
Consulting Agreement was provided. Therefore, the Consulting Agreement has been
automatically extended until March 2011.
 
 ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
 
 The
following table sets forth information as of April 12, 2010, concerning all
persons known by us to own beneficially more than 5% of our Common Stock and
concerning shares beneficially owned by each Director and named Executive
Officer and by all Directors and Executive Officers as a group. Unless expressly
indicated otherwise, each stockholder exercises sole voting and investment power
with respect to the shares beneficially owned.
 
 In
accordance with the rules of the SEC, the table gives effect to the shares of
Common Stock that could be issued upon the exercise of outstanding options and
common stock purchase warrants within the next 60 days. Unless otherwise noted
in the footnotes to the table and subject to community property laws where
applicable, the following individuals have sole voting and investment control
with respect to the shares beneficially owned by them.
  15
  The
address of each Executive Officer and Director is 39 Broadway, New York, NY
10006. We have calculated the percentages of shares beneficially owned based on
18,477,492 shares of Common Stock outstanding at April 12, 2010.
 
 Name
and Address of Beneficial
 Owner
 Shares of
                                                          Common Stock
                                                          Stock
                                                        
                                                        
                                                        Percentage
                                                          Ownership of
                                                          Shares of
                                                          Common
                                                          Stock
                                                          (1 )
                                                        
                                                        
                                                        Preferred
                                                          Shares of
                                                          (2 )
                                                        
                                                        
                                                        Voting Power
                                                          of Shares of
                                                          Preferred
                                                          StockExecutive
      Officers andDirectorsEliron
      Yaron
                                                        
                                                        
                                                        1,367,953
                                                        
                                                        
                                                        
                                                        7.4
                                                        %
                                                        
                                                        
                                                        1,000,000
                                                        
                                                        
                                                        
                                                        52
                                                        %Issac
      Maizel
                                                        
                                                        
                                                        0
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        0Yossi
      Levi
                                                        
                                                        
                                                        0
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        
                                                        0All
      Executive Officers
                                                        
                                                        
                                                        1,367,953
                                                        
                                                        
                                                        
                                                        7.4
                                                        %
                                                        
                                                        
                                                        1,000,000
                                                        
                                                        
                                                        
                                                        52
                                                        %and
      Directors as a group(3
      persons)5% StockholdersJoseph
      Corso (3)
                                                        
                                                        
                                                        3,560,000
                                                        
                                                        
                                                        
                                                        19.3
                                                        %
                                                        
                                                        
                                                        0
                                                        
                                                        
                                                        
                                                        *All
      Executive Officers,Directors
      and 5%Stockholders
      as a group
                                                        
                                                        
                                                        4,927,953
                                                        
                                                        
                                                        
                                                        26.7
                                                        %
                                                        
                                                        
                                                        1,000,000
                                                        
                                                        
                                                        
                                                        52
                                                        %(4
      persons)
 * less
than one percent (1%).
 
 (1)
Percentage of beneficial ownership as to any person as of a particular date is
calculated by dividing the number of shares of Common Stock issued and
outstanding of such person as of such date and the number of unissued shares as
to which such person has the right to acquire voting and/or investment power
within 60 days, by the total issued and outstanding shares of Common Stock of
the Company at such date.
 
 (2)
Comprised of 1,000,000 shares of Common Stock issuable upon the conversion of
1,000,000 shares of Series A Preferred Stock issued to Hull, a company
wholly-owned and controlled by Mr. Yaron. As the sole Stockholder of Hull, Mr.
Yaron may be deemed a beneficial owner of the shares of Common Stock issuable
upon conversion of the Series A Preferred Stock.
 
 (3)
Derived from a Schedule 13G filed by Joseph Corso on January 4, 2007. The
address of such person is: 15 Ottavio, Promenade, Staten Island, NY 10307,
US.
  16
  ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE.
 
 In March
2005, we entered into a Consulting Agreement ("Consulting Agreement") with Hull
Services Inc. ("Hull"), a company wholly-owned and controlled by Eliron Yaron,
the Chairman of the Board of Directors and the Principal Executive Officer of
the Company. Pursuant to the terms of this Consulting Agreement, we pay to Hull
$156,000 per annum in installments of $3,000 per week for Mr. Yaron’s services,
in addition to reimbursing all reasonable expenses incurred in connection with
services rendered on behalf of our Company. The compensation accrues and is paid
when funds for such payments are available. As of December 31, 2009, accrued and
outstanding fees to Hull are $291,152. The Consulting Agreement continues in
effect through March 2010 and contains certain customary confidentiality and
non-compete provisions. The Consulting Agreement is renewed automatically for
successive one year periods until either party gives the other a 180-day prior
written notice of its intent to terminate the Consulting Agreement. As of
December 31, 2009, no prior written notice with the intent to terminate the
Consulting Agreement was provided. Therefore, the Consulting Agreement has been
automatically extended until March 2011.
 
 ITEM
14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
 
 From July
17, 2006 and through the subsequent periods for fiscal year ended December 31,
2009, our principal independent auditor was Rotenberg Meril Solomon Bertiger
& Guttilla, P.C. ("RMSBG"). The following are the services provided and the
amount billed:
 
 AUDIT
FEES
 
 The
aggregate fees billed or to be billed by RMSBG for professional services
rendered for the audit of the Company's annual  financial statements
for the fiscal year ended December 31, 2009 and 2008 and for the review of
the  financial statements included in the Company's Quarterly Reports
on Form 10-Q for the three, six and nine month periods ended March 31, 2009 and
2008, June 30, 2009 and 2008 and September 30, 2009 and 2008 were $36,000 and
$36,000, respectively.
 
 AUDIT
RELATED FEES
 
 Other
than the fees described under the caption "Audit Fees" above, RMSBG did not bill
any fees for services rendered to us during fiscal years 2009 and 2008 for
assurance and related services in connection with the audit or review of
our  financial statements.
 
 TAX
FEES
 
 Fees
billed by RMSBG for tax services rendered during the fiscal years ended December
31, 2009 and 2008 were approximately $1,000 and $1,000,
respectively.
 
 ALL
OTHER FEES
 
 There
were no fees billed by RMSBG for other professional services rendered during the
periods for fiscal years ended December 31, 2009 and 2008,
respectively.
 
 PRE-APPROVAL
OF SERVICES
 
 We do not
have an audit committee. Our Board of Directors pre-approves all services,
including both audit and non-audit services, provided by our independent
accountants. For audit services, each year the independent auditor provides our
Board of Directors with an engagement letter outlining the scope of the audit
services proposed to be performed during the year, which must be formally
accepted by the Board of Directors before the audit commences.  The
independent auditor also submits an audit services fee proposal, which also must
be approved by the Board of Directors before the audit
commences.
  17
  PART
IV
  Item 15.   Exhibits. Financial Statement
Schedules.
 
 Exhibit Number
                
                Description3.1
                
                Certificate
      of Incorporation of the Company. (1)3.2
                
                Bylaws
      of the Company. (1)3.3
                
                Certificate
      of Amendment of Certificate of Incorporation.4.1
                
                Certificate
      of Designation of the Company.(2)10.1
                
                Stock
      Purchase Agreement. (3)10.2
                
                Debentures
      dated October 31, 2001. (2)10.3
                
                Subscription
      Agreement dated as of January 4, 2005 between the Company and Joseph
      Corso. (5)10.4
                
                Financial
      Advisory Agreement dated as of January 4, 2005 between the Company and
      Joseph Corso. (5)10.5
                
                Consulting
      Agreement dated as of March 1, 2005 between the Company and Hull Services,
      Inc. (5)10.6
                
                Letter
      Agreement, dated April 24, 2006, by and between Joseph Corso and Shelron
      Group, Inc. (6)10.7
                
                Extension
      letter, dated May 10, 2005, by Joseph Corso (6)10.8
                
                Extension
      letter, dated June 7, 2005, by Joseph Corso (6)14
                
                Code
      of Ethics. (4)31
                
                Certification
      of Principal Executive Officer and Principal Financial Officer Pursuant to
      Section 302(a) of the Sarbanes-Oxley Act of 2002.32
                
                Certification
      of Principal Executive Officer and Principal Financial Officer Pursuant to
      Section 906 of the Sarbanes-Oxley Act of
2002.
 
 (1) This
exhibit was filed as an exhibit to the Registration statement on Form 10-SB12G
filed on October 11, 2000 and is incorporated herein by reference.
 
 (2) This
exhibit was filed as an exhibit to the Annual Report on Form 10-KSB filed on
April 16, 2002 and is incorporated herein by reference.
 
 (3) This
exhibit was filed as an exhibit to the Current Report on Form 8-K filed on
November 16, 2001 and is incorporated herein by reference.
 
 (4) This
exhibit was filed as an exhibit to the Annual Report on Form 10-KSB filed on May
21, 2004 and is incorporated herein by reference.
 
 (5) This
exhibit was filed as an exhibit to the Annual Report on Form 10-KSB filed on
April 8, 2005 and is incorporated herein by reference.
 
 (6) This
exhibit was filed as an exhibit to the Current Report on Form 8-K filed on May
8, 2006 and is incorporated herein by reference.
  18
  SIGNATURES
 
 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Company has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
  SHELRON
      GROUP, INC.Dated:
      April 13, 2010
                      By:
                      /s/ Eliron YaronEliron
      YaronChairman
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, this Report has been
signed below by the following person on behalf of the Company and in the
capacities and on the date indicated.
 
 Signature
                
                Capacity
                
                Date/s/ Eliron Yaron
                
                Chairman
      and Director
                
                April
      13, 2010/s/
      Issac Maizel
                
                Director
                
                April
      13, 2010/s  Yossi
      Levi
                
                Director
                
                April
      13, 2010
  19


SHELRON
GROUP INC.





INDEX
TO FINANCIAL STATEMENTS





Report
      of Independent Registered Public Accounting Firm
                    F-2Balance
      Sheets as of December 31, 2009 and 2008
                    F-3Statements
      of Operations for the years ended December 31, 2009 and
    2008
                    F-4Statements
      of Stockholders' (Deficiency) Equity for the years ended December 31,
      2009 and 2008
                    F-5Statements
      of Cash Flows for the years ended December 31, 2009 and
    2008
                    F-6Notes
      to Financial Statements
                    F-7
      - F-14





F-1


REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the
Directors and Stockholders of


Shelron
Group, Inc.





We have
audited the accompanying  balance sheets of Shelron Group, Inc. (the
“Company”) as of December 31, 2009 and 2008, and the
related  statements of operations, changes in stockholders’
(deficiency) equity and cash flows for the years then ended.
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 audit to obtain reasonable assurance about whether
the  financial statements are free of material misstatement. The
Company is not required to have, nor were we engaged to perform, an audit of its
internal control over financial reporting. Our audits included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.





In our
opinion, the  financial statements referred to above present fairly,
in all material respects, the  financial position of the Company as of
December 31, 2009 and 2008 and the results of its  operations and
cash flows for the years then ended, in conformity with accounting principles
generally accepted in the United States of America.





The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 1 to
the  financial statements, the Company’s recurring losses from
operations, stockholders' deficiency and working capital deficiency raise
substantial doubt about the Company’s ability to continue as a going concern.
Management’s plans concerning these matters are also described in Note 1. The
accompanying  financial statements do not include any adjustments that
might result from the outcome of this uncertainty.





/s/
Rotenberg Meril Solomon Bertiger & Guttilla, P.C.


Saddle
Brook, New Jersey


April 9,
2010




F-2


SHELRON
GROUP INC.


BALANCE
SHEETS


December
      31,
                
                
                December
      31,2009
                
                
                2008ASSETSCurrent
      Assets:Cash
                
                $
                282
                
                
                $
                47,893Accounts
      receivable, net
                
                
                895
                
                
                
                3,324Other
      current assets
                
                
                -
                
                
                
                2,142Total
      Current Assets
                
                
                1,177
                
                
                
                53,359Property
      and Equipment net of accumulated depreciation of $211,126 and $210,051,
      respectively
                
                
                263
                
                
                
                9,025Intangible
      assets, net of amortization of $0 and $14,000,
respectively
                
                
                -
                
                
                
                26,000Assets
      held for sale
                
                
                -
                
                
                
                134,195Total
      Assets
                
                $
                1,440
                
                
                $
                222,579LIABILITIES
      AND STOCKHOLDERS' DEFICIENCYCurrent
      Liabilities:Accounts
      payable and accrued expenses
                
                $
                81,736
                
                
                $
                40,490Due
      to stockholders
                
                
                291,152
                
                
                
                188,620Convertible
      note payable
                
                
                50,000
                
                
                
                50,000Total
      Current Liabilities
                
                
                422,888
                
                
                
                279,110Liability
      for common stock to be issued to officer
                
                
                162,195
                
                
                
                110,000Liabilities
      held for sale
                
                
                -
                
                
                
                163,520Total
      Liabilities
                
                
                585,083
                
                
                
                552,630CommitmentStockholders'
      Deficiency (post reverse split):Series
      A convertible preferred stock $0.001 par value per share, Authorized
      1,000,000 shares; Issued and outstanding 1,000,000 shares
                
                
                1,000
                
                
                
                1,000Common
      stock, par value $0.001par value per share Authorized 500,000,000 shares;
      Issued and outstanding 18,477,492 shares and 17,447,492 shares,
      respectively
                
                
                18,477
                
                
                
                17,447Additional
      paid-in capital
                
                
                5,497,806
                
                
                
                5,500,686Accumulated
      deficit
                
                
                (6,100,926
                )
                
                
                (5,849,184
                )Total
      Stockholders' Deficiency
                
                
                (583,643
                )
                
                
                (330,051
                )Total
      Liabilities and Stockholders' Deficiency
                
                $
                1,440
                
                
                $
                222,579





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


F-3


SHELRON
GROUP INC.


STATEMENTS
OF OPERATIONS


Year
      EndedDecember
      31,
                    
                    
                    December
      31,2009
                    
                    
                    2008Revenues
                    
                    $
                    896
                    
                    
                    $
                    45,265Operating
      Expenses:Consulting
      fees
                    
                    
                    24,129
                    
                    
                    
                    74,559Employment
      compensation
                    
                    
                    163,104
                    
                    
                    
                    158,368Professional
      fees
                    
                    
                    38,000
                    
                    
                    
                    44,495Marketing
      and advertising
                    
                    
                    (6,083
                    )
                    
                    
                    60,589Office
      and general expenses
                    
                    
                    12,333
                    
                    
                    
                    53,761Rent
                    
                    
                    -
                    
                    
                    
                    10,991Depreciation
      and amortization
                    
                    
                    12,762
                    
                    
                    
                    36,526Bank
      charges
                    
                    
                    4,119
                    
                    
                    
                    3,024Bad
      debt expense
                    
                    
                    3,262
                    
                    
                    
                    -Intangible
      asset impairment loss
                    
                    
                    22,000
                    
                    
                    
                    -Total
      Operating Expenses
                    
                    
                    273,626
                    
                    
                    
                    442,313Loss
      from continuing operations
                    
                    
                    (272,730
                    )
                    
                    
                    (397,048
                    )Other
      Income (Expense)Interest
      expense
                    
                    
                    (3,750
                    )
                    
                    
                    -Interest
      income
                    
                    
                    -
                    
                    
                    
                    438Loss
      from Continuing Operations
                    
                    
                    (276,480
                    )
                    
                    
                    (396,610
                    )Discontinued
      Operations:Loss
      from discontinued operations
                    
                    
                    (42,774
                    )
                    
                    
                    (30,091
                    )Gain
      on disposition of discontinued operations
                    
                    
                    67,512
                    
                    
                    
                    -Income
      (loss) from Discontinued Operations
                    
                    
                    24,738
                    
                    
                    
                    (30,091
                    )Net
      Loss
                    
                    $
                    (251,742
                    )
                    
                    $
                    (426,701
                    )Net
      loss per share:Continuing
      Operations – basic and diluted
                    
                    $
                    (0.02
                    )
                    
                    $
                    (0.02
                    )Discontinued
      Operations – basic and diluted
                    
                    $
                    0.00
                    
                    
                    $
                    (0.00
                    )Weighted
      average shares outstandingBasic
      and Diluted
                    
                    
                    17,987,108
                    
                    
                    
                    16,884,259





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


F-4


SHELRON
GROUP INC.


STATEMENTS
OF STOCKHOLDERS' (DEFICIENCY) EQUITY





Preferred
      Stock
                  
                  
                  Common
      StockNumber
                  
                  
                  
                  
                  
                  Price
                  
                  
                  Number
                  
                  
                  
                  
                  
                  Additional
                  
                  
                  
                  
                  
                  Totalof
                  
                  
                  
                  
                  
                  Per
                  
                  
                  of
                  
                  
                  
                  
                  
                  Paid-in
                  
                  
                  Accumulated
                  
                  
                  Stockholders'Shares
                  
                  
                  Amount
                  
                  
                  Share
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Deficit
                  
                  
                  DeficiencyBalance
      at January 1, 2008
                  
                  
                  1,000,000
                  
                  
                  $
                  1,000
                  
                  
                  $
                  -
                  
                  
                  
                  16,427,546
                  
                  
                  $
                  16,428
                  
                  
                  $
                  5,423,705
                  
                  
                  $
                  (5,422,483
                  )
                  
                  $
                  18,650Issuance
      of Common Stock for capital contributions
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  433,333
                  
                  
                  
                  433
                  
                  
                  
                  49,567
                  
                  
                  
                  -
                  
                  
                  
                  50,000Issuance
      of Common Stock for consulting fees and services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  586,613
                  
                  
                  
                  586
                  
                  
                  
                  27,414
                  
                  
                  
                  -
                  
                  
                  
                  28,000Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (426,701
                  )
                  
                  
                  (426,701
                  )Balance
      at December 31, 2008
                  
                  
                  1,000,000
                  
                  
                  $
                  1,000
                  
                  
                  
                  -
                  
                  
                  
                  17,447,492
                  
                  
                  $
                  17,447
                  
                  
                  $
                  5,500,686
                  
                  
                  $
                  (5,849,184
                  )
                  
                  $
                  (330,051
                  )Issuance
      of Common Stock for consulting fees and services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  1,150,000
                  
                  
                  
                  1,150
                  
                  
                  
                  12,000
                  
                  
                  
                  -
                  
                  
                  
                  13,150Cancellation
      of Common Stock issued for consulting fees and services
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (120,000
                  )
                  
                  
                  (120
                  )
                  
                  
                  (14,880
                  )
                  
                  
                  -
                  
                  
                  
                  (15,000
                  )Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  $
                  (251,742
                  )
                  
                  
                  (251,742
                  )Balance
      at December 31, 2009
                  
                  
                  1,000,000
                  
                  
                  $
                  1,000
                  
                  
                  
                  -
                  
                  
                  
                  18,477,492
                  
                  
                  $
                  18,477
                  
                  
                  $
                  5,497,806
                  
                  
                  $
                  (6,100,926
                  )
                  
                  $
                  (583,643
                  )





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


F-5


SHELRON
GROUP INC.


STATEMENTS
OF CASH FLOWS





Year
      EndedDecember
      31,
                          
                          
                          December
      31,2009
                          
                          
                          2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                          
                          $
                          (251,742
                          )
                          
                          $
                          (426,701
                          )Adjustments to reconcile net loss to net cash used
      in operating activities:Depreciation
      and amortization
                          
                          
                          12,762
                          
                          
                          
                          36,526Common
      stock issued for consulting fees and services
                          
                          
                          13,150
                          
                          
                          
                          28,000Cancellation
      of common stock issued for consulting fees and services
                          
                          
                          (15,000
                          )
                          
                          
                          -Allowance
      for doubtful accounts
                          
                          
                          3,262
                          
                          
                          
                          -Impairment
      of intangible asset
                          
                          
                          22,000
                          
                          
                          
                          -Changes in operating assets and
      liabilities:(Increase)
      decrease in accounts receivable
                          
                          
                          (833
                          )
                          
                          
                          16,417Decrease
      (increase) in other current assets
                          
                          
                          2,142
                          
                          
                          
                          (2,142
                          )Increase
      in accounts payable
                          
                          
                          41,247
                          
                          
                          
                          629Increase
      in due to stockholders
                          
                          
                          102,532
                          
                          
                          
                          105,004Net
      cash used in operating activities
                          
                          
                          (70,480
                          )
                          
                          
                          (242,267
                          )Discontinued
      OperationsAdjustments
      to reconcile net cash (used in) provided by discontinued
      operations
                          
                          
                          (29,326
                          )
                          
                          
                          (16,638
                          )CASH
      FLOWS FROM FINANCING ACTIVITIES:Cash
      received from officer for common stock to be issued
                          
                          
                          52,195
                          
                          
                          
                          110,000Proceeds
      from issuance of common stock
                          
                          
                          -
                          
                          
                          
                          15,000Proceeds
      from notes payable
                          
                          
                          -
                          
                          
                          
                          50,000Net
      cash provided by financing activities
                          
                          
                          52,195
                          
                          
                          
                          175,000Net
      decrease in cash
                          
                          
                          (47,611
                          )
                          
                          
                          (83,905
                          )Cash
      at beginning of year
                          
                          
                          47,893
                          
                          
                          
                          131,798Cash
      at end of year
                          
                          $
                          282
                          
                          
                          $
                          47,893Supplemental Cash Flow
      InformationDisposition
      of subsidiary - non-cashAssets
      disposed
                          
                          $
                          121,190
                          
                          
                          
                          -Liabilities
      disposed
                          
                          $
                          188,702Gain
      on disposition of discontinued operations
                          
                          $
                          67,512Payment
      of interest
                          
                          
                          -
                          
                          
                          
                          -





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


F-6


SHELRON
GROUP INC.


NOTES
TO FINANCIAL STATEMENTS


December
31, 2009 and 2008





NOTE
1 - THE COMPANY AND ITS OPERATIONS





Shelron
Group, Inc. (the "Company") originally incorporated in the State of
Massachusetts in June 1987, under the name "Professional Brushes, Inc." In April
1999, the Company changed its state of incorporation to Delaware by means of a
merger with and into a Delaware company and, in connection therewith, changed
our name to "PB Acquisition Corp." In May 2000, the Company entered into a share
exchange agreement with TTTTickets.com, Inc., a Delaware corporation ("Tickets")
incorporated in April 2000 for the purposes of developing and maintaining an
internet website for the sale and purchase of event tickets, pursuant to which
Tickets became a wholly owned subsidiary of the Company. We also changed our
name to "TTTTickets Holding Corp." Thereafter, in November 2001, we entered into
a stock purchase and merger agreement with B-Park Communications, Inc.,
("B-Park") a Delaware corporation formed in August 2001 for the sole purpose of
entering into such agreement. In September 2002, we changed our name to Shelron
Group, Inc.





The
Company develops and markets e-commerce advertising and comparative shopping
software products and services. The Company released its initial product,
ActiveShopper, in August 2004. ActiveShopper is a free software download that
automatically scans, locates and compares prices for an item that a consumer
selects at an e-commerce site and is designed to assist consumers to make
informed purchase decisions by enabling them to find the items they are looking
for, compare products, prices and stores, and buy from among thousands of online
merchants.





On
October 20, 2008, the Company also effected a one to twenty-five reverse stock
split of its shares of common stock, par value $0.001.  All share
figures and results in the financial statements are reflected on a post reverse
split basis.





At the
present time, the Company does not intend to actively promote its current
Activeshopper product but will instead explore new opportunities in the
media/internet/high-tech fields.





The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As shown in the accompanying financial statements,
the Company has incurred losses of $251,742 and $426,701 for the years ended
December 31, 2009 and 2008, and a working capital deficiency which raises
substantial doubt about the Company's ability to continue as a going
concern.





Management
believes that the Company will continue to incur losses and negative cash flows
from operating activities for the foreseeable future and will need additional
equity or debt financing to sustain its operations until it can achieve
profitability and positive cash flows, if ever. Management plans to seek
additional debt and/or equity financing for the Company, but cannot assure that
such financing will be available on acceptable terms.  The Company's
continuation as a going concern is dependent upon its ability to ultimately
attain profitable operations, generate sufficient cash flow to meet its
obligations, and obtain additional financing as may be required. The outcome of
this uncertainty cannot be assured. The Company is currently dependent on its
President to continue to fund the Company. If the Company is unable to acquire
or develop an operating business the Company will be unable to fund itself.
There is no guarantee that our President will continue to fund the
Company.





The
accompanying consolidating financial statements do not include any adjustments
that might result from the outcome of this uncertainty. There can be no
assurance that management will be successful in implementing its business plan
or that the successful implementation of such business plan will actually
improve the Company's operating results.




NOTE
2 – DISCONTINUED OPERATIONS





On
October 1, 2010, we discontinued the operations and disposed of our subsidiary.
The operations for our discontinued subsidiary resulted in a net loss of $42,774
and $30,091 for the years ended December 31, 2009 and 2008, respectively. The
operating results of this subsidiary are classified as discontinued operations
in the statements of operations. The total of the assets and liabilities
disposed was $121,190 and $188,702, respectively.  We recorded a gain
on the disposition of our subsidiary in the amount of $67,512.




F-7


NOTE
3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





The
following accounting policies have been identified as critical to the Company's
business operations and the understanding of its results of
operations.





Basis
of Presentation and Principles of Consolidation





The
Company’s financial statements are prepared in conformity with US generally
accepted accounting principles ("GAAP").





Prior to
October 1, 2009 the accompanying financial statements included the accounts of
Shelron Group Inc. (the "Company") and its wholly owned subsidiary. All
significant inter company transactions were eliminated.





Adoption
of Codification





Effective
July 1, 2009, the FASB's ASC became the single official source of authoritative,
nongovernmental generally accepted accounting principles in the United States
("GAAP"). The historical GAAP hierarchy was eliminated and the ASC became the
only level of authoritative GAAP, other than guidance issued by the Securities
and Exchange Commission. Our accounting policies were not affected by the
conversion to ASC. However, references to specific accounting standards in the
footnotes to our financial statements have been changed to refer to the
appropriate section of ASC.





Management
does not believe that any recently issued, but not yet effective, accounting
standard if currently adopted would have a material effect on the accompanying
financial statements.




Reclassifications


Certain
prior period amounts have been reclassified to conform to current
classifications.





Use
of Estimates


These
financial statements and accompanying notes have been prepared in accordance
with accounting principles generally accepted in the United States of America.
The preparation of these financial statements requires management to make
estimates, judgments and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses. The Company continually evaluates the
accounting policies and estimates used to prepare the financial statements. The
Company bases its estimates on historical experiences and assumptions believed
to be reasonable under current facts and circumstances. Actual amounts and
results could differ from these estimates made by management.





Functional
Currency


The
majority of Company’s sales are in United States dollars. In addition, the
majority of the Company’s investing and financing activities are in United
States dollars. Accordingly, the Company has determined the United States dollar
as the currency of its primary economic environment and thus, its functional and
reporting currency. Non-dollar transactions and balances have been measured in
United States dollars in accordance with Financial Accounting Standards Board
(“FASB”) Accounting Standards Codification (“ASC”) 830, “Foreign Currency
Matters.” All transaction gains and losses from the measurement of monetary
balance sheet items denominated in non-dollar currencies are reflected in the
statement of operations as financial income or expenses, as
appropriate.





Concentration
of Credit Risk


The
Company maintains cash in bank accounts which may, at times, exceed federally
insured limits. The Company has not experienced any loss on these
accounts.


F-8


Fair
Value of Financial Instruments


The
carrying amounts reported in the balance sheet for cash, receivables, accounts
payable and accrued expenses and short-term debt approximate fair value based on
the short-term maturity of these instruments.





Accounts
Receivable


Accounts
receivable are reported at their outstanding unpaid principal balances reduced
by an allowance for doubtful accounts. The Company estimates doubtful accounts
based on historical bad debts, factors related to specific customers' ability to
pay, and current economic trends. The Company writes off accounts receivable
against the allowance when a balance is determined to be
uncollectible.  At December 30, 2009 and 2008 the allowance for
doubtful accounts was $3262 and 0, respectfully.





Property
and Equipment


Depreciation
of property and equipment is provided for by the straight-line method over the
estimated useful lives of the related assets. Long-lived assets are reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of the asset may not be recoverable.





Intangible
Assets


Intangible
assets are carried at cost less accumulated amortization. Amortization is
computed on the straight-line method over the estimated useful lives
of the assets. We periodically review the carrying value of our intangible
assets to determine whether impairment may exist under the provisions of FASB
ASC 360, “Property, Plant and Equipment.” We consider relevant cash flow and
profitability information, including estimated future operating results, trends
and other available information, in assessing whether the carrying value of the
intangible assets can be recovered. If it is determined that the carrying value
of the intangible assets will not be recovered from the undiscounted future cash
flows, the carrying value of the assets would be considered impaired. An
impairment charge is measured as any deficiency in the amount of estimated fair
value of the intangible assets over carrying value.





Revenue
Recognition


The
Company's revenue derives from service revenue and the management of advertising
campaigns, both of which are related to ActiveShopper.





Service
revenue primarily derives from the implementation of partnership agreements
according to which the Company provides a service of directing traffic to
merchants' websites. Service revenue is primarily based on a pay-per-click
model, reported at their net values to the Company, which represent the revenues
the Company is entitled to receive according to the partnership agreements. In
order to recognize service revenue, the following criteria must be met: (i) the
partnership agreement must be signed by the customer, (ii) the signed agreement
must specify the fees to be received for the services, (iii) the service has
been performed and accepted by the customer, (iv) no significant Company
obligations remain and (v) collectability is probable.





Management
of advertising campaign revenues primarily relates to advertising through
ActiveShopper websites. In order to recognize management of advertising
campaigns revenue, the following criteria must be met: (i) an agreement must be
signed by the customer, (ii) the signed agreement must specify the fees to be
received, (iii) consultancy and management have been provided and accepted by
the customer, (iv) no significant Company obligations remain and (v)
collectability is probable.





When the
above stated revenue recognition criteria are not met, the Company records
deferred revenue.





Marketing
and Advertising


Marketing
and advertising costs are expensed as incurred.


F-9


Income
Taxes


The
Company accounts for income taxes under the provisions of FASB ASC 740, “Income
Taxes.” This pronouncement requires recognition of deferred tax assets and
liabilities for the estimated future tax consequences of events attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases and operating loss and tax credit
carry forwards. Deferred tax assets and liabilities are measured using enacted
tax rates in effect for the year in which the differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of
changes in tax rates is recognized in the statement of operations in the period
in which the enactment rate changes. Deferred tax assets and liabilities are
reduced through the establishment of a valuation allowance at such time as,
based on available evidence, it is more likely than not that the deferred tax
assets will not be realized.





Effective
January 1, 2007, the Company adopted the provisions of FASB ASC 740-10-05,
“Accounting for Uncertainties in Income Taxes” The ASC clarifies the accounting
for uncertainty in income taxes recognized in an enterprise’s financial
statements. The ASC prescribes a recognition threshold and measurement attribute
for the financial statement recognition and measurement of a tax position taken
or expected to be taken in a tax return. The ASC provides guidance on
de-recognition, classification, interest and penalties, accounting in interim
periods, disclosure and transition.





Earnings
(loss) per share


Basic
earnings (loss) per share is computed by dividing net income (loss) by the
weighted-average number of shares of Common Stock outstanding during the period.
Diluted earnings (loss) per share give effect to dilutive convertible
securities, options, warrants and other potential Common Stock outstanding
during the period, only in periods in which such effect is
dilutive.  The following securities have been excluded from the
calculation of net loss per share, as their effect would be antidilutive:




2009
                
                
                2008Series
      A convertible preferred stock
                
                
                1,000,000
                
                
                
                1,000,000Convertible
      note payable
                
                
                1,892,606
                
                
                
                448,437





Stock
Based Compensation


The
Company records compensation expense associated with stock options and other
forms of equity compensation in accordance with FASB ASC 718, “Compensation –
Stock Compensation.” Under the fair value recognition provision of FASB ASC 718,
stock-based compensation cost is estimated at the grant date based on the fair
value of the award. The Company estimates the fair value of stock options
granted using the Black-Scholes-Merton option pricing model.




F-10


NOTE
4 – PROPERTY AND EQUIPMENT





Property
and equipment at December 31, 2009 and 2008 consists of:


December 31,2009
                      
                      
                      
                      2008
                      
                      useful lifeSoftware
                      
                      $
                      150,000
                      
                      
                      $
                      150,000
                      
                      5
      yearsComputer
      and office equipment
                      
                      
                      45,614
                      
                      
                      
                      45,498
                      
                      3-7
      yearsFurniture
      and fixtures
                      
                      
                      15,775
                      
                      
                      
                      23,578
                      
                      5-10
      years211,389
                      
                      
                      
                      224,465Less
      - accumulated depreciation and amortization
                      
                      
                      211,126
                      
                      
                      
                      210,051$
                      263
                      
                      
                      $
                      9,025




Depreciation
and amortization from continuing operations amounted to $12,762 and $36,526 for
the years ended December 31, 2009 and 2008, respectively.





NOTE
5 - INTANGIBLE ASSETS





On April
18, 2005, the Company entered into an agreement with Infospace, Inc. to purchase
the rights, title and interest of Infospace, Inc. in the U.S. and foreign
trademarks, trade names and service marks for "ActiveShopper" and the domain
names activeshopper.com, activeshopper.org, active-shop.com, active-shopper.com,
active-shopper.net and active-shopper.org. The Company made a one-time payment
of $40,000.  The asset was being amortized on a straight-line basis
over a period of ten years.





Amortization
totaled $4,000 and $4,000 for the years ended December 31, 2009 and 2008,
respectively.  At December 31, 2009, the Company determined that since
the Company has changed its business strategy and it is no longer actively
promoting its current ActiveShopper product, the asset related to the
ActiveShopper name became impaired.  The Company recorded an
impairment loss of $22,000 during the period.





NOTE
6 - DUE TO STOCKHOLDERS AND RELATED PARTIES





Hull Services, Inc.
("Hull")


The
Company is controlled by Hull, a company wholly-owned by the Company's Principal
Executive Officer/Principal Financial and Accounting officer.  In
March 2005, the Company entered into a consulting agreement with
Hull.  Pursuant to the terms of the agreement, Hull receives
consulting fees totaling $156,000 per annum in installments of $3,000 per
week.  Due to stockholder represents accrued but unpaid consulting as
well as other loans payable made by Hull.





For each
of the years ended December 31, 2009 and 2008, consulting services totaled
$163,104 and $158,368, respectively.  Such amounts are reflected on
the statements of operations as employment compensation.  At December
31, 2009 and 2008, the Company owed Hull $291,152 and $188,620,
respectively.





Eliron
Yaron


Mr. Yaron
is the Company's Principal Executive Officer/Principal Financial and Accounting
Officer.  At December 31, 2009 and 2008, the Company owed Mr. Yaron a
total of $0 and $44,876, respectively.





Liability for Common Stock
to be issued to officer


In 2009
and 2008, the Company received proceeds totaling $52,195 and $110,000,
respectively, for shares of Common Stock to be issued to Mr. Yaron. As the
shares were not issued as of December 31, 2009, the proceeds were not included
in stockholders’ deficiency but classified as a liability for common stock to be
issued to officer. The liability totaled $162,195 and $110,000 as of December
31, 2009 and 2008, respectively.




F-11


NOTE
7 – NOTES PAYABLE





Convertible
Note


On
October 2, 2008, the Company received proceeds of $50,000 for a unsecured
convertible note payable issued for working capital purposes. The note bears
interest at 6% per annum and matured on April 18, 2009. The note holder has the
option to convert the note and related accrued interest into share of the
Company’s Common Stock at equal or lower of (a) 20% below the average of the
closing price of the Common Stock for the five trading days prior to the date of
the agreement and (b) the average closing price of the Common Stock for the five
trading days prior to the date of the conversion notice.





As of the
filing of this Annual Report on Form 10-K, the Company has not made any payments
in respect of the amounts due.  The non-payment of this amount constitutes
an event of default under the transaction document.  However, the pertinent
documents provide that any action upon such default can only be initiated by the
note holder.  Such an action has not been commenced. From and after an
event of non-payment under the note and for so long as the event of non-payment
is continuing, the note will bear interest at a rate of 6% per annum.





Note
Payable


On
December 30, 2008, the Company’s subsidiary issued a note payable for $100,000
in order to acquire a license to utilize software, trademarks and domain names.
The note bore interest at 4% per annum and matured on December 30,
2009.  As a result of the disposition of the subsidiary, the note
payable is no longer reflected.





NOTE
8 - STOCKHOLDERS' (DEFICIENCY) EQUITY





Convertible
Preferred Stock


On
November 8, 2001, the Company filed a Certificate of Designation with the State
of Delaware authorizing the issuance of one series of Preferred Stock (the
"Series A Preferred Stock") consisting of 1,000,000 shares. All 1,000,000 shares
of Series A Preferred Stock were issued to Hull. The holder of the Series A
Preferred Stock is entitled to vote along with the holders of Common Stock as
one class on all matters for which the Stockholders of the Company shall vote.
The holder of Series A Preferred Stock is entitled to a vote representing 52% of
the total shares entitled to vote by all holders of the then outstanding shares
of Common Stock and Series A Preferred Stock combined. Each share of the Series
A Preferred Stock is convertible at the option of the holder into one share of
Common Stock upon not less than 15 days and not more than 30 days notice to the
Company. In addition, if all or substantially all of the Company's assets or all
of the outstanding shares of the Company are sold, the shares of Series A
Preferred Stock automatically convert to Common Stock.





Issuance
(cancellation) of shares of Common Stock


During
the year ended December 31, 2009, the Company issued (net of cancellation of
120,000 shares of Common Stock) 1,030,000 shares of its Common Stock to one
service provider in consideration of services rendered totaling
$13,150.





During
the year ended December 31, 2008, the Company issued 586,613 shares of its
Common Stock to service providers in consideration of services rendered totaling
$28,000.





On July
1, 2008, the Company issued 200,000 shares of common stock to an investor under
a Shares Purchases Agreement for proceeds totaling $15,000.





In May
2008, the Company issued 233,333 shares of its common stock to Eliron Yaron at
$0.15 per share for gross proceeds of $35,000.  The proceeds were
received by the Company in December 2007.


F-12


NOTE
9 – REVENUE AND MAJOR CUSTOMERS





During
the years ended December 31, 2009 and 2008, revenues from continuing operations
in the amount of $896 and $47,893 were generated from the implementation of
partnership agreements according to which traffic is directed to merchants'
websites through ActiveShopper.





During
the year ended December 31, 2009, all revenues were generated from one
customer.  This customer comprised approximately 66% of the Company's
accounts receivables at December 31, 2009, of which another customer accounted
for approximately 35% of accounts receivable.





During
the year ended December 31, 2008, revenues generated from two customers
accounted for approximately 96% of total revenues, of which one customer
accounted for approximately 95% of total revenues.  These customers
comprise approximately 57% of the Company's accounts receivables at December 31,
2008, of which one customer accounted for approximately 51% of accounts
receivable.





Revenues
were earned in the following countries:




2009
                
                
                
                2008United
      States
                
                $
                896
                
                
                $
                46,851United
      Kingdom
                
                
                -
                
                
                
                243Others
                
                
                -
                
                
                
                799Total
                
                $
                896
                
                
                $
                47,893




F-13


NOTE
10 - INCOME TAXES





The
deferred income tax assets at December 31, 2009 and 2008 relate to temporary
differences between the financial statement carrying amounts and their tax
basis.  Assets that give rise to the deferred tax assets are as
follows at December 31:




2009
                
                
                2008Net
      operating loss carry forwards
                
                $
                2,032,418
                
                
                $
                1,739,000Valuation
      allowance
                
                
                (2,032,418
                )
                
                
                (1,739,000
                )Net
      income tax assets
                
                $
                -
                
                
                $
                -





A
valuation allowance has been established equal to the full amount of the
deferred tax assets as the Company is not assured at December 31, 2009 and 2008
that it is more likely than not that these benefits will be
realized.





The
change in valuation allowance for the years ended December 31, 2009 and 2008 was
an increase of $293,000 and $144,000, respectively, due to increases in net
operating loss carry forwards.





At
December 31, 2009, the Company has unused federal net operating loss carry
forwards of approximately $5,377,000 expiring between 2021 and
2030.




The
Company does not currently expect any significant changes to unrecognized tax
benefits during the fiscal year ended December 31, 2010. The Company's
practice is to recognize interest and/or penalties related to income tax matters
in income tax expense. As of December 31, 2009 and 2008, the Company had no
accrued interest or penalties. In certain cases, the Company's uncertain tax
positions are related to tax years that remain subject to examination by the
relevant tax authorities. The Company files federal and state income tax returns
in jurisdictions with varying statutes of limitations. The 2006 through 2008 tax
years generally remain subject to examination by federal and most state tax
authorities.





NOTE
11 -  COMMITMENT





We
maintain an office at 39 Broadway, New York, New York.  No rent is
charged for this space.  In April 2008, we terminated the lease of an
apartment in New York, NY, from an unaffiliated party for which we had paid
approximately $2,700 per month.





The
Company’s subsidiary had a lease agreement for an approximately 77 square meters
of office space at 22 a Raul Wallenberg Street, Tel Aviv, Israel from an
unaffiliated party for approximately $1,500 per month in addition to certain
occupancy and office maintenance costs. As a result of the disposition of
the subsidiary, the lease is no longer reflected.




Rent
expense included in continuing operations for the years ended December 31, 2009
and 2008 totaled $0 and $10,991, respectively.





NOTE
13 -  SUBSEQUENT EVENT





On March
30, 2010, Mr. Yaron agreed to increase his investment in the Company by
contributing 200,000 shares of stock of a publicly traded Over-The-Counter
Bulletin Board company.  On March 30, 2010 the shares to be
contributed had a value of $64,000 based on the closing price per share of the
stock on such day.


F-14