UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB/A

(Amendment No. 1)

(Mark One)

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

For the quarterly period ended: June 30, 2007



| ̈ | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
|- | ---------------------------------------------------------------

For the transition period from  to

Commission File Number: 000-52029

PLATINUM RESEARCH ORGANIZATION, INC.

(Exact name of small business issuer as specified in its charter)



|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Delaware                                                       |  | 20-2842514                       
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)
|                                                               | 
|2777 Stemmons Freeway, Suite 1440, Dallas Texas                |  | 75207                            
|(Address of principal executive offices)                       |  | (Zip code)                       

Issuers telephone number: 214-271-9503

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   ̈

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

State the
number of shares outstanding of each of the issuers classes of common equity, as of the latest practicable date:

75,000,000 shares
of common stock issued and outstanding as of March 28, 2008

Transitional Small Business Disclosure Format (Check
one):  Yes   ̈    No  x









---

EXPLANATORY NOTE

This Form 10-QSB/A is being filed by Platinum Research Organization, Inc. (the Company) to amend its Quarterly Report on Form 10-QSB for the
fiscal quarter ended June 30, 2007 (the Report) that was filed with the Securities and Exchange Commission on August 14, 2007. For the readers convenience, this Amendment No. 1 includes all Items included in the Report, even those
not amended by this Amendment No. 1. The information contained in this Amendment No. 1 does not reflect events occurring after the filing of the Report except those required to reflect the effects of the restatement of the Companys financial
statements for the periods presented or as deemed necessary in connection with the completion of the Companys restated financial statements. Changes from the original to the amended filing include: (i) amendments to the Companys
financial statements in Item 1 to address the Companys accounting for its shares of Series A Preferred Stock and the cancellation and reissuance of stock options; (ii) amendments to Managements Discussion and Analysis or Plan
of Operation in Item 2; and (iii) modifications of managements evaluation of the effectiveness of the Companys disclosure controls and procedures in Item 3. In addition, this Amendment No. 1 includes updated certifications from the
Companys Chief Executive Officer and Chief Financial Officer as Exhibits 31.1, 31.2 and 32.1.

TABLE OF CONTENTS



|                                                                                                        |  |         
|------------------------------------------------------------------------------------------------------- |  | --------
|                                                                                                        |  | Page No.
|NOTE CONCERNING FORWARD-LOOKING INFORMATION                                                             |  | 1       
|                                                                                                        | 
|PART I: FINANCIAL INFORMATION                                                                           |  | 1       
|                                                                                                        | 
|Item 1.
Financial Statements (unaudited)                                                                |  | 1       
|Consolidated Balance Sheets as of June 30, 2007 and December 31, 2006                                   |  | 3       
|Consolidated Statements of Operations for the Three- and Six-Month Periods Ended June 30, 2007 and 2006 |  | 4       
|Consolidated Statements of Cash Flows for the Six-Month Periods Ended June 30, 2007 and 2006            |  | 5       
|Consolidated Statements of Changes in Shareholders Equity                                              |  | 6       
|Notes to Consolidated Financial Statements                                                              |  | 7       
|Item 2.
Managements Discussion and Analysis or Plan of Operation                                       |  | 19      
|Item 3.
Controls and Procedures                                                                         |  | 25      
|                                                                                                        | 
|PART II: OTHER INFORMATION                                                                              |  | 27      
|                                                                                                        | 
|Item 4.
Submission of Matters to a Vote of Security Holders                                             |  | 27      
|Item 6.
Exhibits                                                                                        |  | 27      
|                                                                                                        | 
|SIGNATURES                                                                                              |  | 29      
|                                                                                                        | 
|EXHIBIT INDEX                                                                                           |  |         



---

NOTE CONCERNING FORWARD-LOOKING INFORMATION

The statements contained in this Form 10-QSB that are not purely
historical are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These include statements about our expectations, beliefs, intentions or
strategies for the future, which are indicated by words or phrases such as anticipate, expect, intend, plan, will, believe, management believes and similar words or
phrases. The forward-looking statements are based on our current expectations and are subject to certain risks, uncertainties and assumptions. Our actual results could differ materially from results anticipated in these forward-looking statements.
All forward-looking statements included in this document are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements.

PART I - FINANCIAL INFORMATION



|Item 1. | Financial Statements
|------- | --------------------

The interim financial
statements included herein are unaudited but reflect, in managements opinion, all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation of financial position and the results of our operations for the
interim periods presented.

The interim financial statements should be read in conjunction with the financial statements of Platinum
Research Organization, Inc. (the Company) and the notes thereto contained in the Companys audited financial statements for the year ended December 31, 2006 presented in the Annual Report on Form 10-KSB that was filed with the
Securities and Exchange Commission (the SEC) on March 23, 2007.

Interim results are not necessarily indicative of results
for the full fiscal year.

The unaudited consolidated financial statements presented in this Amendment No. 1 to Quarterly Report on Form
10-QSB/A restate the unaudited consolidated financial statements of the Company contained in the Companys Quarterly Report on Form 10-QSB originally filed with the Securities and Exchange Commission (SEC) on August 14, 2007.

On March 24, 2008, the Audit Committee of the Companys Board of Directors determined that the Companys previously issued
unaudited financial statements for the three and six months ended June 30, 2007 (the Financial Statements) contained errors in accounting with respect to the Companys issuance of its shares of Series A Preferred Stock
(Series A Preferred) on April 18, 2007 and errors in accounting with respect to the cancellation and reissuance of stock options on April 18, 2007. As a result, the Audit Committee, in consultation with management and the Companys
independent registered public accounting firm, concluded that the Companys unaudited financial statements included in the Form 10-QSB for the period ended June 30, 2007 should no longer be relied upon and should be restated.

The Company previously classified the 5,000,000 shares of Series A Preferred issued on April 18, 2007 as components of Shareholders Equity. Since
the Certificate of Designation for these shares contains a mandatory redemption date, the Company has determined these shares should be reclassified as a long-term liability in accordance with SFAS 150. The correction of this error has resulted in
the Series A Preferred being reflected as a long-term liability on the Companys Balance Sheet. The correction of this error has increased interest expense, increased the net loss and increased the long-term liability reported by the Company by
$36,000 for the three months and six months ended June 30, 2007.



1



---

The Company also did not properly calculate or record the intrinsic value of the Beneficial Conversion
Feature contained in the Series A Preferred. The shares of Series A Preferred are convertible into shares of the Companys common stock at a value less than the fair market value of the underlying common stock when the shares of Series A
Preferred were issued on April 18, 2007. In accordance with EITF 98-5, this price differential generated a Beneficial Conversion Feature and has resulted in a discount of $4,500,000 offsetting the long-term liability for the Series A Preferred
shares and a $4,500,000 increase in additional paid-in capital at the issuance date of the Series A Preferred shares. Additionally, in accordance with EITF 00-27, the discount will be accreted to interest expense over the five-year period from the
issuance date to the mandatory redemption date of the Series A Preferred shares, resulting in a reduction of the long term liability discount and an increase in interest expense over this five-year period. The correction of this error has increased
interest expense, increased the net loss and reduced the Beneficial Conversion Discount reported by the Company by $180,000 for the three and six months ended June 30, 2007.

The Company also identified an error in the calculation of compensation cost for the three and six months ended June 30, 2007. On April 18, 2007, options
for 3,116,428 shares of the Companys common stock were issued at an exercise price of $1.35. The compensation cost related to the issuance of these stock options was not recorded in the financial statements for the period ended June 30, 2007.
Recognizing the additional compensation expense has resulted in increased salary expense and an increased net loss reported by the Company of $91,431 for the three and six months ended June 30, 2007.

See Note 2 to the Notes to Financial Statements for a discussion regarding the impact of the restatements on the Financial Statements.



2



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Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Consolidated Balance Sheets

(Unaudited)



|                                                                |  |               |            |   |                   |   |           |  
|--------------------------------------------------------------- |  | ------------- | ---------- | - | ----------------- | - | --------- | -
|                                                                |  | June 30, 2007 |            |   | December 31, 2006 |  
|                                                                |  | (Restated)    |            |   |                   |  
|Assets                                                          |  |               |            |   |                   |   |           |  
|Current Assets                                                  |  |               |            |   |                   |   |           |  
|Cashunrestricted                                               |  | $             | 3,517,377  |   |                   | $ | 211,778   |  
|Cash-Restricted                                                 |  |               | 1,565,667  |   |                   |   | 1,527,389 |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Cash                                                      |  |               | 5,083,044  |   |                   |   | 1,739,167 |  
|Accounts Receivable                                             |  |               | 3,745      |   |                   |   | 3,301     |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Current Assets                                            |  |               | 5,086,789  |   |                   |   | 1,742,468 |  
|Property, Plant and Equipment - net of accumulated depreciation |  |               | 3,628      |   |                   |   | 1,402     |  
|Other Assets                                                    |  |               |            |   |                   |   |           |  
|Loan Issuance Costs - Net of accumulated amortization           |  |               | 241,908    |   |                   |   | 327,254   |  
|Intellectual Property - Net of accumulated amortization         |  |               | 3,557,371  |   |                   |   | 3,698,207 |  
|Intellectual Property - non amortizable                         |  |               | 172,322    |   |                   |   | 133,490   |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Other Assets                                              |  |               | 3,971,601  |   |                   |   | 4,158,951 |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Assets                                                    |  | $             | 9,062,018  |   |                   | $ | 5,902,821 |  
|                                                                |  |               |            |   |                   |   |           |  
|Liabilities and Shareholders Equity                            |  |               |            |   |                   |   |           |  
|Current Liabilities                                             |  |               |            |   |                   |   |           |  
|Accounts Payable                                                |  | $             | 270,357    |   |                   | $ | 134,187   |  
|Accrued Interest                                                |  |               | 70,000     |   |                   |   | 70,000    |  
|Preferred Dividend Payable                                      |  |               | 93,699     |   |                   |   |          |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Current Liabilities                                       |  |               | 434,056    |   |                   |   | 204,187   |  
|Long Term Debt                                                  |  |               | 6,000,000  |   |                   |   | 6,000,000 |  
|Long Term Liabilities                                           |  |               |            |   |                   |   |           |  
|Mandatorily Redeemable Preferred Stock                          |  |               | 4,500,000  |   |                   |   |          |  
|Preferred Stock, Beneficial Conversion Discount                 |  |               | (4,320,000 | ) |                   |   |          |  
|Preferred Stock, Discount on Convertible Liability              |  |               | 36,000     |   |                   |   |          |  
|                                                                |  |               |            |   |                   |   |           |  
|Total Long Term Liabilities                                     |  |               | 216,000    |   |                   |   |          |  
|Shareholders Equity                                            |  |               | 2,411,962  |   |                   |   | (301,366  | )
|                                                                |  |               |            |   |                   |   |           |  
|Total Liabilities and Shareholders Equity                      |  | $             | 9,062,018  |   |                   | $ | 5,902,821 |  
|                                                                |  |               |            |   |                   |   |           |  

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



3



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Consolidated Statements of Operations

(Unaudited)



|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|---------------------------------------------------- |  | ------------------ | ---------- | - | ------------ | - | ---------- | ---------------- | ------- | - | ------------ | ------- |  | ------------------------------------ | ---------- | ---------- |  | - | ---------- | ---------- |  | - | ---------- | - |  | - | ---------- | -
|                                                     |  | Three Months Ended |            |   | Incr/ (Decr) |   |            | Six Months Ended |         |   | Incr/ (Decr) |         |  | For the Period From Dateof Inception |           
|                                                     |  | 6/30/07            |            |   | 6/30/06      |   |            |                  | 6/30/07 |   |              | 6/30/06 |  |                                      |            | to 6/30/07 | 
|                                                     |  | (Restated)         |            |   |              |   |            |                  |         |   | (Restated)   |         |  |                                      |            |            |  |   |            | (Restated) | 
|Sales                                                |  | $                  |           |   |              | $ |           |                  |         | $ |             |         |  | $                                    |           |            |  | $ |           |            |  | $ |           |   |  | $ |           |  
|Cost of Goods Sold                                   |  |                    |           |   |              |   |           |                  |         |   |             |         |  |                                      |           |            |  |   |           |            |  |   |           |   |  |   |           |  
|Gross Profit                                         |  |                    |           |   |              |   |           |                  |         |   |             |         |  |                                      |           |            |  |   |           |            |  |   |           |   |  |   |           |  
|Selling General and Administrative Expenses          |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Salaries                                             |  |                    | 244,185    |   |              |   | 73,132     |                  |         |   | 171,053      |         |  |                                      | 366,475    |            |  |   | 145,553    |            |  |   | 220,922    |   |  |   | 1,162,946  |  
|Travel                                               |  |                    | 40,081     |   |              |   | 35,116     |                  |         |   | 4,965        |         |  |                                      | 69,240     |            |  |   | 50,604     |            |  |   | 18,636     |   |  |   | 292,905    |  
|Product Evaluation / Technical Support               |  |                    | 56,558     |   |              |   | 31,375     |                  |         |   | 25,183       |         |  |                                      | 108,976    |            |  |   | 72,750     |            |  |   | 36,226     |   |  |   | 496,902    |  
|Outside Legal and Professional Fees                  |  |                    | 395,494    |   |              |   | 72,745     |                  |         |   | 322,749      |         |  |                                      | 526,121    |            |  |   | 144,295    |            |  |   | 381,826    |   |  |   | 1,456,086  |  
|Contribution Agreement Related Costs                 |  |                    | 200,317    |   |              |   |           |                  |         |   | 200,317      |         |  |                                      | 339,783    |            |  |   |           |            |  |   | 339,783    |   |  |   | 339,783    |  
|Insurance                                            |  |                    | 61,438     |   |              |   | 16,695     |                  |         |   | 44,743       |         |  |                                      | 78,036     |            |  |   | 25,595     |            |  |   | 52,441     |   |  |   | 246,066    |  
|Rent                                                 |  |                    | 14,306     |   |              |   | 6,503      |                  |         |   | 7,803        |         |  |                                      | 23,283     |            |  |   | 10,839     |            |  |   | 12,444     |   |  |   | 95,708     |  
|Other                                                |  |                    | 22,560     |   |              |   | 9,885      |                  |         |   | 12,675       |         |  |                                      | 36,320     |            |  |   | 13,693     |            |  |   | 22,627     |   |  |   | 128,103    |  
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Total SG&A                                           |  |                    | 1,034,939  |   |              |   | 245,451    |                  |         |   | 789,488      |         |  |                                      | 1,548,234  |            |  |   | 463,329    |            |  |   | 1,084,905  |   |  |   | 4,218,499  |  
|Depreciation and Amortization                        |  |                    | 122,880    |   |              |   | 121,828    |                  |         |   | 1,052        |         |  |                                      | 245,355    |            |  |   | 243,440    |            |  |   | 1,915      |   |  |   | 1,456,409  |  
|Other Income                                         |  |                    | 59,945     |   |              |   | 35,493     |                  |         |   | 24,452       |         |  |                                      | 88,031     |            |  |   | 71,793     |            |  |   | 16,238     |   |  |   | 354,573    |  
|Interest Expense                                     |  |                    | 450,794    |   |              |   | 210,000    |                  |         |   | 240,794      |         |  |                                      | 660,794    |            |  |   | 420,000    |            |  |   | 240,794    |   |  |   | 2,886,528  |  
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Net Loss Before Taxes                                |  |                    | (1,548,668 | ) |              |   | (541,786   | )                |         |   | (1,006,882   | )       |  |                                      | (2,366,352 | )          |  |   | (1,054,976 | )          |  |   | (1,311,376 | ) |  |   | (8,206,863 | )
|Income Tax - Current                                 |  |                    |           |   |              |   |           |                  |         |   |             |         |  |                                      |           |            |  |   |           |            |  |   |           |   |  |   |           |  
|Income Tax - Deferred                                |  |                    |           |   |              |   |           |                  |         |   |             |         |  |                                      |           |            |  |   |           |            |  |   |           |   |  |   |           |  
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Net Loss                                             |  |                    | (1,548,668 | ) |              |   | (541,786   | )                |         |   | (1,006,882   | )       |  |                                      | (2,366,352 | )          |  |   | (1,054,976 | )          |  |   | (1,311,376 | ) |  |   | (8,206,863 | )
|Dividends Declared on Preferred Stock                |  |                    | (93,700    | ) |              |   |           |                  |         |   | (93,700      | )       |  |                                      | (93,700    | )          |  |   |           |            |  |   | (93,700    | ) |  |   | (93,700    | )
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Net Loss Attributed to Common Shareholders           |  | $                  | (1,642,368 | ) |              | $ | (541,786   | )                |         | $ | (1,100,582   | )       |  | $                                    | (2,460,052 | )          |  | $ | (1,054,976 | )          |  | $ | (1,405,076 | ) |  | $ | (8,300,563 | )
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Per Share Amounts                                    |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Net Loss                                             |  | $                  | (0.02      | ) |              | $ | (0.02      | )                |         |   |             |         |  | $                                    | (0.04      | )          |  | $ | (0.04      | )          |  |   |           |   |  | $ | (0.28      | )
|Dividends Declared on Preferred Stock                |  |                    |           |   |              |   |           |                  |         |   |             |         |  |                                      |           |            |  |   |           |            |  |   |           |   |  |   |           |  
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Loss per Common Share  Basic                        |  | $                  | (0.02      | ) |              | $ | (0.02      | )                |         |   |             |         |  | $                                    | (0.04      | )          |  | $ | (0.04      | )          |  |   |           |   |  | $ | (0.28      | )
|                                                     |  |                    |            |   |              |   |            |                  |         |   |              |         |  |                                      |            |            |  |   |            |            |  |   |            |   |  |   |            |  
|Weighted Average Number of Common Shares Outstanding |  |                    | 68,571,429 |   |              |   | 22,609,890 |                  |         |   | 45,961,539   |         |  |                                      | 55,483,425 |            |  |   | 27,582,873 |            |  |   | 27,900,552 |   |  |   | 29,721,503 |  

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



4



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Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Consolidated Statements of Cash Flows

(Unaudited)



|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|-------------------------------------------------------------------- |  | ---------------------- | ---------- | - | --------------------- | - | ---------- | ---------- |  | - | ---------- | -
|                                                                     |  | Six-Month Period Ended |            |   | Inception to6/30/2007 |  
|                                                                     |  | 6/30/2007              |            |   | 6/30/2006             |   |           
|                                                                     |  | (Restated)             |            |   |                       |   |            | (Restated) | 
|Cash Flow From Operating Activities                                  |  |                        |            |   |                       |   |            |            |  |   |            |  
|Net Loss for the Period                                              |  | $                      | (2,366,352 | ) |                       | $ | (1,054,976 | )          |  | $ | (8,206,863 | )
|Items not requiring Cash                                             |  |                        |            |   |                       |   |            |            |  |   |            |  
|Depreciation and Amortization                                        |  |                        | 245,355    |   |                       |   | 243,440    |            |  |   | 1,456,409  |  
|Option Expense                                                       |  |                        | 172,842    |   |                       |   |           |            |  |   | 172,842    |  
|Interest Expense  Preferred Stock Discount                          |  |                        | 216,000    |   |                       |   |           |            |  |   | 216,000    |  
|Changes in Assets and Liabilities                                    |  |                        |            |   |                       |   |            |            |  |   |            |  
|(Increase) / Decrease in Receivables                                 |  |                        | 94         |   |                       |   | (94        | )          |  |   | (3,207     | )
|Increase / (Decrease) in Payables                                    |  |                        | 136,170    |   |                       |   | (4,297     | )          |  |   | 270,357    |  
|Increase / (Decrease) in Accrued Interest                            |  |                        |           |   |                       |   |           |            |  |   | 1,167,681  |  
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Net Cash Used in Operating Activities                                |  |                        | (1,595,891 | ) |                       |   | (815,927   | )          |  |   | (4,926,781 | )
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Cash Flow From Investing Activities                                  |  |                        |            |   |                       |   |            |            |  |   |            |  
|Purchases of Property, Plant and Equipment                           |  |                        | (2,652     | ) |                       |   | (715       | )          |  |   | (5,625     | )
|Investment in Intellectual Property                                  |  |                        | (57,580    | ) |                       |   | (22,984    | )          |  |   | (304,209   | )
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Net Cash Used in Investing Activities                                |  |                        | (60,232    | ) |                       |   | (23,699    | )          |  |   | (309,834   | )
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Cash Flow From Financing Activities                                  |  |                        |            |   |                       |   |            |            |  |   |            |  
|Net ProceedsLong Term Debt                                          |  |                        |           |   |                       |   |           |            |  |   | 5,550,000  |  
|Preferred Shares Issued for Cash                                     |  |                        | 4,500,000  |   |                       |   |           |            |  |   | 4,500,000  |  
|Funds Received From Previously Controlled Entity                     |  |                        | 500,000    |   |                       |   |           |            |  |   | 500,000    |  
|Loan Costs/Other                                                     |  |                        |           |   |                       |   |           |            |  |   | (230,341   | )
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Net Cash Generated From Financing Activities                         |  |                        | 5,000,000  |   |                       |   |           |            |  |   | 10,319,659 |  
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Increase (decrease) in cash and cash equivalents                     |  |                        | 3,343,877  |   |                       |   | (839,626   | )          |  |   | 5,083,044  |  
|Cash and Cash Equivalents Beginning of Period                        |  |                        | 1,739,167  |   |                       |   | 3,553,211  |            |  |   |           |  
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Cash and Cash Equivalents End of Period                              |  | $                      | 5,083,044  |   |                       | $ | 2,713,585  |            |  | $ | 5,083,044  |  
|                                                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Supplemental Disclosures:                                            |  |                        |            |   |                       |   |            |            |  |   |            |  
|Cash Paid During the Period for:                                     |  |                        |            |   |                       |   |            |            |  |   |            |  
|Interest                                                             |  | $                      | 444,794    |   |                       | $ | 420,000    |            |  | $ | 2,124,794  |  
|Income Tax                                                           |  |                        |           |   |                       |   |           |            |  |   |           |  
|Non-Cash Items                                                       |  |                        |            |   |                       |   |            |            |  |   |            |  
|Purchase of Intellectual Property Through the Assumption of Debt     |  |                        |           |   |                       |   |           |            |  | $ | 4,475,789  |  
|Partners Capital Contribution Resulting from the Forgiveness of Debt |  |                        |           |   |                       |   |           |            |  | $ | 5,536,597  |  
|Preferred Dividends                                                  |  | $                      | 93,700     |   |                       |   |           |            |  | $ | 93,700     |  
|Interest Expense                                                     |  | $                      | 216,000    |   |                       |   |           |            |  | $ | 216,000    |  

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



5



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Consolidated Statement of Changes in Shareholders Equity

U.S. Dollars



|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|------------------------------------------------- |  | ------------------------ | - |  | --------------------------- |  | ---------------------- |  | ------------- | - |  | ------------------------- |  | ------------------------------------------ | - |  | -------------------------------- | - |  | --------- |  | ----------------------------- | - |  | ------------------------------ | -
|                                                  |  | NumberCommonSharesIssued |   |  | NumberPreferredSharesIssued |  | NumberofWarrantsIssued |  | CapitalStock$ |   |  | PreferredStock$(Restated) |  | Paid inCapital andDistributions$(Restated) |   |  | Subscrip-tionsPayable$(Restated) |   |  | Warrants$ |  | DeficitAccumulated$(Restated) |   |  | ShareholdersEquity $(Restated) |  
|Balance at April 28, 2004  Date of Inception     |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Forgiveness of Debt (Note 12)                     |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 5,536,597                                  |   |  |                                  |   |  |           |  |                               |   |  | 5,536,597                      |  
|Capital Contributions                             |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 4,484                                      |   |  |                                  |   |  |           |  |                               |   |  | 4,484                          |  
|Distributions                                     |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | (145                                       | ) |  |                                  |   |  |           |  |                               |   |  | (145                           | )
|Net Loss                                          |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  | (1,347,794                    | ) |  | (1,347,794                     | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Balance at December 31, 2004                      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 5,540,936                                  |   |  |                                  |   |  |           |  | (1,347,794                    | ) |  | 4,193,142                      |  
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Capital Contributions                             |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 1,938                                      |   |  |                                  |   |  |           |  |                               |   |  | 1,938                          |  
|Distributions                                     |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | (4,740                                     | ) |  |                                  |   |  |           |  |                               |   |  | (4,740                         | )
|Net Loss                                          |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  | (2,147,610                    | ) |  | (2,147,610                     | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Balance at December 31, 2005                      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 5,538,134                                  |   |  |                                  |   |  |           |  | (3,495,404                    | ) |  | 2,042,730                      |  
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Capital Contributions                             |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 1,086                                      |   |  |                                  |   |  |           |  |                               |   |  | 1,086                          |  
|Distribution                                      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | (75                                        | ) |  |                                  |   |  |           |  |                               |   |  | (75                            | )
|Net Loss for period                               |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  | (2,345,107                    | ) |  | (2,345,107                     | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Balance at December 31, 2006                      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 5,539,145                                  |   |  |                                  |   |  |           |  | (5,840,511                    | ) |  | (301,366                       | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Capital Contribution                              |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 268                                        |   |  |                                  |   |  |           |  |                               |   |  | 268                            |  
|Earnings Charge for options expense (Note 7)      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 36,359                                     |   |  |                                  |   |  |           |  |                               |   |  | 36,359                         |  
|Net Loss for period                               |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  | (817,684                      | ) |  | (817,684                       | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Balance at March 31, 2007                         |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 5,575,772                                  |   |  |                                  |   |  |           |  | (6,658,195                    | ) |  | (1,082,423                     | )
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Capital Contributions                             |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 269                                        |   |  |                                  |   |  |           |  |                               |   |  | 269                            |  
|Shares Issued to PRO Transferors (Note 6)         |  | 55,000,000               |   |  |                             |  |                        |  | 55,000        |   |  |                           |  | (55,000                                    | ) |  |                                  |   |  |           |  |                               |   |  |                                |  
|Preferred Equity raised (Note 4)                  |  |                          |   |  | 5,000,000                   |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Warrants Issued to Investa/Pineda (Note 6)        |  |                          |   |  |                             |  | 2,500,000              |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Earnings charge for options expense (Note 7)      |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 136,484                                    |   |  |                                  |   |  |           |  |                               |   |  | 136,484                        |  
|Preferred dividends payable (Note 4)              |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  | (93,700                          | ) |  |           |  |                               |   |  | (93,700                        | )
|Net Loss for Period                               |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  | (1,548,668                    | ) |  | (1,548,668                     | )
|Beneficial conv option  Preferred Stock (Note 4) |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  | 4,500,000                                  |   |  |                                  |   |  |           |  |                               |   |  | 4,500,000                      |  
|Equity of PRO Inc. at 3/31/2007                   |  | 42,500,000               |   |  |                             |  |                        |  | 42,500        |   |  |                           |  | 435,097                                    |   |  |                                  |   |  |           |  |                               |   |  | 477,597                        |  
|Change in PRO Inc. Equity 3/31-4/18/2007          |  | (22,500,000              | ) |  |                             |  |                        |  | (22,500       | ) |  |                           |  | 44,903                                     |   |  |                                  |   |  |           |  |                               |   |  | 22,403                         |  
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Equity of PRO Inc at 4/18/2007                    |  | 20,000,000               |   |  |                             |  |                        |  | 20,000        |   |  |                           |  | 480,000                                    |   |  |                                  |   |  |           |  |                               |   |  | 500,000                        |  
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  
|Balance at June 30, 2007                          |  | 75,000,000               |   |  | 5,000,000                   |  | 2,500,000              |  | 75,000        |   |  |                           |  | 10,637,525                                 |   |  | (93,700                          | ) |  |           |  | (8,206,863                    | ) |  | 2,411,962                      |  
|                                                  |  |                          |   |  |                             |  |                        |  |               |   |  |                           |  |                                            |   |  |                                  |   |  |           |  |                               |   |  |                                |  

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



6



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial Statements

June 30, 2007



|1. | Nature and Continuance of Operations
|-- | ------------------------------------

Platinum
Research Organization, Inc. (the Company) was incorporated in the State of Nevada on May 13, 2005, under the name NorthTech Corporation. The Company was originally formed to develop, expand and market two web-based database
programs for small business and community sports. The Company completed its initial public offering in March 2006. Efforts to implement this business plan were pursued, but ultimately the web-based software development business was abandoned.

Management reviewed various strategic alternatives, and on October 26, 2006, the Company entered into a Contribution Agreement with
Platinum Research Organization L.P., a Texas limited partnership (Platinum LP), Lubrication Partners, a joint venture and sole shareholder of Platinum IP Management, Inc., the general partner of Platinum LP, each holding a limited
partnership interest in Platinum LP, and Cork Jaeger as the representative of all PRO Transferors and Steve Drayton as the representative of certain individual private placement investors in the Company.

The Company, at the time being NorthTech Corporation, merged with its wholly-owned subsidiary Platinum Research Organization, Inc., a Nevada
corporation (NV Sub), on October 31, 2006, in order to amend its charter documents, change its name to Platinum Research Organization, Inc. and effect a 5-for-1 forward split of its outstanding common stock. On April 13,
2007, the Company completed another merger with its wholly-owned subsidiary, Platinum Research Organization, Inc., a Delaware corporation (DE Sub), to reincorporate the Company in Delaware. The name of the surviving company remained
Platinum Research Organization, Inc., and the certificate of incorporation and bylaws of DE Sub became the certificate of incorporation and bylaws of the Company. Both NV Sub and DE Sub were formed by the Company for the sole purpose of
effecting the aforementioned transactions in preparation for the consummation of the transactions contemplated by the Contribution Agreement. On April 18, 2007, we closed the Contribution Agreement (Note 8), which resulted in our acquisition of
Platinum LP and the appointment of a new slate of directors. As a result of our acquisition of Platinum LP, the Companys new business focus is the design, development and commercialization of patented high-performance lubricants and coatings.

The acquisition of Platinum LP has been accounted for as a reverse acquisition application of the purchase method of accounting by the
Company (formerly known as NorthTech), with Platinum LP treated as the accounting acquirer. Accordingly, the assets and liabilities of the Company (formerly known as NorthTech) have been recorded at their respective historical costs and added to
those of Platinum LP, and the reported results of operations of the Company reflect the historical results of operations of Platinum LP.

The Companys products will be marketed under the trade name TechroBond for automotive,
aviation, industrial and consumer aftermarkets. TechroBondTMis one of a series of product applications Platinum LP developed based on its patented
processes and technologies relating to a fluorinated thiophosphate and a new technique to react zinc dialkyl dithiophosphate (ZDDP) and poly tetra fluroethylene to yield new proprietary compounds that enhance the anti-wear and
anti-corrosion capabilities of lubricants and coatings (individually and collectively, the PRO Technology). The resulting compounds have yielded significantly enhanced anti-wear and anti-corrosion capabilities when measured in bench
laboratory tests at the University of Texas at Arlington, and, more importantly, suggest that the PRO Technology may be a replacement for ZDDP in engine and lubricating oils. Management believes that this new technology will position the Company to
penetrate several large, global markets for lubricants should the Company be successful in bringing its products that rely upon this new technology to market.

The Company is a development stage enterprise, as defined in Statements of Financial Accounting Standards (SFAS) No. 7. The Company is currently devoting all of its present efforts to
commercialization of its products and technologies. Accordingly, no revenue has been realized to date.



7



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



The Companys financial statements as at June 30, 2007 and for the three- and six-month
periods then ended have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company incurred a loss of $2,366,352 for the
six-month period ended June 30, 2007 and had cash of $5,083,044 at June 30, 2007.

Management cannot provide assurance that the
Company will ultimately achieve profitable operations or become cash flow positive, or raise additional debt and/or equity capital. Management believes that the Companys capital resources should be adequate to continue operating and
maintaining its business strategy for the next twelve months. However, if the Company is unable to realize revenue from the commercialization of its products or is unable to raise additional capital in the future, management expects that the Company
will need to seek additional capital on less favorable terms and/or pursue other remedial measures. These financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and
classification of liabilities that might be necessary should the Company be unable to continue as a going concern.



|2. | Significant Accounting Policies
|-- | -------------------------------

The following is a
summary of significant accounting policies used in the preparation of these financial statements.

Basis of presentation

The accompanying unaudited interim financial statements have been prepared as of June 30, 2007, and for the three- and six-month periods ended
June 30, 2007 and 2006 in accordance with accounting principles generally accepted in the United States of America (GAAP) relating to the preparation of financial statements for interim periods. Accordingly, they do not include all
the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three- and six-month periods ended June 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007.

These interim financial statements follow the same accounting policies and methods of their application as the most recent annual financial statements.
These interim financial statements should be read in conjunction with the audited financial statements of the Company as at December 31, 2006, as contained in the Companys Form 10-KSB filed with the Securities and Exchange Commission on
March 23, 2007.

Restatements

Subsequent to the Companys issuance of 5,000,000 shares of Series A Preferred Stock (Series A Preferred) in connection with the consummation of the Contribution Agreement on
April 18, 2007, the Companys Audit Committee and management concluded that changes were necessary to correct the accounting for the Series A Preferred shares in the financial statements for the three and six months ended June 30,
2007. The Company previously classified the 5,000,000 Series A Preferred shares issued on April 18, 2007 as components of Shareholders Equity. Since the Certificate of Designation for these shares contains a mandatory redemption date the
Company has determined these shares should be classified as a long-term liability in accordance with SFAS 150. The correction of this error required the Series A Preferred shares to be reflected as a long-term liability on the Companys Balance
Sheet. The long-term liability will be increased by $900,000 over the five-year period from the issuance date to the mandatory redemption date of the Preferred shares to reflect the 20% redemption premium contained in the Certificate of Designation
for the Series A Preferred. The correction of this error increased interest expense, increased the net loss and increased the long-term liability reported by the Company by $36,000 for the three months and six months ended June 30, 2007. The
recognition of this item did not affect the cash balance of the Company.



8



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



The Company also did not properly calculate or record the intrinsic value of the Beneficial
Conversion Feature contained in Series A Preferred shares. The Series A Preferred shares are convertible into shares of the Companys common shares at a value of $0.18 per common share at the option of the holder, which price was less than the
fair market value of the underlying common stock when the Series A Preferred shares were issued on April 18, 2007. In accordance with EITF 98-5, this price differential generated a Beneficial Conversion Feature which should have been recognized as a
discount against the long-term liability and is limited to the proceeds received from the issuance of the Series A Preferred shares. The recognition of the Beneficial Conversion Feature resulted in a discount of $4,500,000 offsetting the long-term
liability for the Series A Preferred shares and a $4,500,000 increase in additional paid-in capital at the issuance date of the Series A Preferred shares. Additionally, in accordance with EITF 00-27, the discount will be accreted to interest expense
over the five-year period from the issuance date to the mandatory redemption date of the Series A Preferred shares, which will result in a reduction of the long term liability discount and an increase in interest expense over this five-year period.
The correction of this error increased interest expense, increased the net loss and reduced the Beneficial Conversion Discount by $180,000 for the three and six months ended June 30, 2007. The recognition of this item did not affect the cash balance
of the Company.

The Company also identified an error in the calculation of compensation cost for the three and six months ended June 30,
2007. On April 18, 2007, options for 3,116,428 shares of common stock were issued at an exercise price of $1.35. The compensation cost related to the issuance of these stock options was not recorded in the financial statements for the period ended
June 30, 2007. Recognizing the additional compensation expense resulted in increased salary expense and an increased net loss of $91,431 for the three and six months ended June 30, 2007 and did not affect the cash balance of the Company.

The following table reflects the restatement for each line on the Companys unaudited Consolidated Balance Sheet as of June 30, 2007:



|                                                   |  |                     |           |            |   |            |                 |  |   |            |  
|-------------------------------------------------- |  | ------------------- | --------- | ---------- | - | ---------- | --------------- |  | - | ---------- | -
|                                                   |  | As of June 30, 2007 |          
|Line Item                                          |  | OriginalBalance     |           | Adjustment |   |            | RestatedBalance | 
|Mandatorily Redeemable Preferred Stock             |  | $                   |          |            | $ | 4,500,000  |                 |  | $ | 4,500,000  |  
|Preferred Stock, Beneficial Conversion Discount    |  | $                   |          |            | $ | (4,320,000 | )               |  | $ | (4,320,000 | )
|Preferred Stock, Discount on Convertible Liability |  | $                   |          |            | $ | 36,000     |                 |  | $ | 36,000     |  
|Shareholders Equity                               |  | $                   | 2,627,962 |            | $ | (216,000   | )               |  | $ | 2,411,962  |  



9



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



The following table reflects the restatement for each line on the Companys unaudited
Consolidated Statement of Operations for the three and six months ended June 30, 2007:



|                                           |  |                                  |            |   |                                |   |          |                 |  |   |                 |   |  |            |            |   |                 |   |          |   |  |   |            |  
|------------------------------------------ |  | -------------------------------- | ---------- | - | ------------------------------ | - | -------- | --------------- |  | - | --------------- | - |  | ---------- | ---------- | - | --------------- | - | -------- | - |  | - | ---------- | -
|                                           |  | Three Months Ended June 30, 2007 |            |   | Six Months Ended June 30, 2007 |  
|Line Item                                  |  | OriginalBalance                  |            |   | Adjustment                     |   |          | RestatedBalance |  |   | OriginalBalance |   |  | Adjustment |            |   | RestatedBalance |  
|Salaries                                   |  | $                                | 152,754    |   |                                | $ | 91,431   |                 |  | $ | 244,185         |   |  | $          | 275,044    |   |                 | $ | 91,431   |   |  | $ | 366,475    |  
|Total SG&A                                 |  | $                                | 943,508    |   |                                | $ | 91,431   |                 |  | $ | 1,034,939       |   |  | $          | 1,456,803  |   |                 | $ | 91,431   |   |  | $ | 1,548,234  |  
|Interest Expense                           |  | $                                | 234,794    |   |                                | $ | 216,000  |                 |  | $ | 450,794         |   |  | $          | 444,794    |   |                 | $ | 216,000  |   |  | $ | 660,794    |  
|Net Loss Before Taxes                      |  | $                                | (1,241,238 | ) |                                | $ | (307,430 | )               |  | $ | (1,548,668      | ) |  | $          | (2,058,922 | ) |                 | $ | (307,430 | ) |  | $ | (2,366,352 | )
|Net Loss                                   |  | $                                | (1,241,238 | ) |                                | $ | (307,430 | )               |  | $ | (1,548,668      | ) |  | $          | (2,058,922 | ) |                 | $ | (307,430 | ) |  | $ | (2,366,352 | )
|Dividends Declared on Preferred Stock      |  | $                                |           |   |                                | $ | (93,700  | )               |  | $ | (93,700         | ) |  | $          |           |   |                 | $ | (93,700  | ) |  | $ | (93,700    | )
|Net Loss Attributed to Common Shareholders |  | $                                | (1,241,238 | ) |                                | $ | (401,130 | )               |  | $ | (1,642,368      | ) |  | $          | (2,058,922 | ) |                 | $ | (401,130 | ) |  | $ | (2,460,052 | )
|Per Share Amounts                          |  |                                  |            |   |                                |   |          |                 |  |   |                 |   |  |            |            |   |                 |   |          |   |  |   |            |  
|Net Loss                                   |  | $                                | (0.02      | ) |                                | $ |         |                 |  | $ | (0.02           | ) |  | $          | (0.04      | ) |                 | $ |         |   |  | $ | (0.04      | )
|Dividends Declared on Preferred Stock      |  | $                                |           |   |                                | $ |         |                 |  | $ |                |   |  | $          |           |   |                 | $ |         |   |  | $ |           |  
|Net Loss Attributed to Common Shareholders |  | $                                | (0.02      | ) |                                | $ |         |                 |  | $ | (0.02           | ) |  | $          | (0.04      | ) |                 | $ |         |   |  | $ | (0.04      | )

Principles of consolidation

The consolidated financial statements include the accounts of PRO, Inc., PRO, LP and PIP, LP, its wholly owned subsidiaries. All material intercompany
accounts and transactions are eliminated in consolidation.

Cash and cash equivalents

Cash and cash equivalents include highly liquid investments with original maturities of three months or less.

Intangible Assets

Amortizable
Intellectual Property. For the six-month period ended June 30, 2007, the Company had $3,557,371 in amortizable intellectual property that consisted principally of capitalized patent costs related to the Companys five patents. The net
balance at June 30, 2007 consisted of $4,570,803 in gross patent carrying costs and $1,013,432 of accumulated amortization. These patents are being amortized over their useful remaining life and have an average weighted amortization period of
15 years.

If a particular patent or trademark is denied or abandoned, the associated costs are written off.

Non-amortizable Intellectual Property. For the period ended June 30, 2007 the Company had $172,322 in non-amortizable intellectual property
that consisted of capitalized trademark costs and pending patent costs.



10



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



Intellectual Property consisted of the following for the listed periods:



|                                      |  |                          |            |   |                              |   |           |                              |  |   |           |  
|------------------------------------- |  | ------------------------ | ---------- | - | ---------------------------- | - | --------- | ---------------------------- |  | - | --------- | -
|                                      |  | SixMonths Ended6/30/2007 |            |   | TwelveMonths Ended12/31/2006 |   |           | TwelveMonths Ended12/31/2005 | 
|Amortizable Intellectual Property     |  | $                        | 4,570,803  |   |                              | $ | 4,552,055 |                              |  | $ | 4,438,810 |  
|Less: Accumulated Amortization        |  |                          | (1,013,432 | ) |                              |   | (853,848  | )                            |  |   | (537,119  | )
|                                      |  |                          |            |   |                              |   |           |                              |  |   |           |  
|                                      |  |                          | 3,557,371  |   |                              |   | 3,698,207 |                              |  |   | 3,901,691 |  
|Non-amortizable Intellectual Property |  |                          | 172,322    |   |                              |   | 133,490   |                              |  |   | 160,859   |  
|                                      |  |                          |            |   |                              |   |           |                              |  |   |           |  
|                                      |  | $                        | 3,729,693  |   |                              | $ | 3,831,697 |                              |  | $ | 4,062,550 |  

Future Amortization costs for Amortizable Intellectual Property are as follows:



|                           |  |   |          
|-------------------------- |  | - | ---------
|6 months ended 12/31/2007  |  | $ | 74,835   
|12 months ended 12/31/2008 |  |   | 463,657  
|12 months ended 12/31/2009 |  |   | 307,317  
|12 months ended 12/31/10   |  |   | 307,317  
|12 months ended 12/31/11   |  |   | 307,317  
|12 months ended 12/31/12   |  |   | 307,317  
|Beyond                     |  |   | 1,789,611
|                           |  |   |          
|Total                      |  | $ | 3,557,371

Amortization expense relating to Intellectual Property was $159,584 and $316,729 for the six month
period ended June 30, 2007 and the twelve month period ended December 31, 2006, respectively.

Financial instruments

The carrying value of cash, loans receivable, accounts payable and accrued liabilities, amounts due to related parties and convertible
promissory notes payable approximates their fair value because of the short maturity of these instruments. Prior to April 2007, the Companys operations were located in Canada, and virtually all of its assets and liabilities gave rise to
significant exposure to market risks from changes in foreign currency rates. The Companys financial risk is the risk that arises from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company
does not use derivative instruments to reduce its exposure to foreign currency risk.

Derivative financial instruments

The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency
fluctuations.

Research and Development

The Companys research and development efforts are conducted primarily by the University of Texas at Arlington. Research and development expenditures consist primarily of research salaries and materials consumed
in the testing and evaluation process. All such expenses are expensed as incurred. The Companys research and development expenditures for the six months ended June 30, 2007 were $108,976 compared to $72,749 for the same period in 2006.
Research and development expenses are included in the Product Evaluation and Technical Support line item of Selling, General and Administrative expenses.



11



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



Income taxes

Deferred income taxes are reported for timing differences between items of income or expense reported in the financial statements and those reported for income tax purposes in accordance with SFAS No. 109,
Accounting for Income Taxes, which requires the use of the asset/liability method of accounting for income taxes. Deferred income taxes and tax benefits are recognized for the future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and for tax loss and credit carry-forwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The Company provides for deferred taxes for the estimated future tax effects attributable to temporary differences and carry-forwards when realization
is more likely than not. As of June 30, 2007 and June 30, 2006, the net deferred tax asset has been offset by a valuation allowance.

Basic and diluted net loss per share

The Company computes net loss per share in accordance with SFAS No. 128,
Earnings per Share. SFAS No. 128 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders
(numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all potentially dilutive common shares outstanding during the period using the treasury stock method and convertible
preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes
all potentially dilutive shares if their effect is anti-dilutive.

Comprehensive loss

SFAS No. 130, Reporting Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in
the financial statements. As of June 30, 2007, the Company had no items that represented a comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

Segments of an enterprise and related information

SFAS No. 131, Disclosures about Segments of an Enterprise and Related Information, supersedes SFAS No. 14, Financial Reporting for Segments of a Business Enterprise. SFAS 131 establishes
standards for the way that public companies report information about operating segments in annual financial statements and requires reporting of selected information about operating segments in interim financial statements issued to the public. It
also establishes standards for disclosures regarding products and services, geographic areas and major customers. SFAS 131 defines operating segments as components of a company about which separate financial information is available that is
evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company has evaluated this SFAS and does not believe it is applicable at this time.

Start-up expenses

The Company has
adopted Statement of Position No. 98-5, Reporting the Costs of Start-up Activities, which requires that costs associated with start-up activities be expensed as incurred. Accordingly, start-up costs associated with the
Companys formation have been included in the Companys expenses for the period from the date of incorporation on May 13, 2005 to June 30, 2007.



12



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



Foreign currency translation

The Companys functional and reporting currency is in U.S. dollars. The financial statements of the Company are translated to U.S. dollars in
accordance with SFAS No. 52, Foreign Currency Translation. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Gains and losses arising on
translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact
of foreign currency fluctuations.

Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of the financial statements and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from these estimates.

Recent accounting pronouncements

In
February 2007, the Financial Accounting Standards Board (the FASB) issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (SFAS 159). SFAS 159 allows the Company to choose
to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS 159 is effective for fiscal years beginning after
November 15, 2007. The Company is currently evaluating the requirements of SFAS 159 and the potential impact on the Companys financial statements.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurement (SFAS 157). The Statement provides guidance for using fair value to measure assets and liabilities. The Statement
also expands disclosures about the extent to which companies measure assets and liabilities at fair value, the information used to measure fair value, and the effect of fair value measurement on earnings. This Statement applies under other
accounting pronouncements that require or permit fair value measurements. This Statement does not expand the use of fair value measurements in any new circumstances. Under this Statement, fair value refers to the price that would be received to sell
an asset or paid to transfer a liability in an orderly transaction between market participants in the market in which the entity transacts. SFAS 157 is effective for the Company for fair value measurements and disclosures made by the Company in its
fiscal year beginning on January 1, 2008. The Company is currently reviewing the impact of this statement.

In February 2006, the FASB
issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments, which amends SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities and SFAS No. 140. SFAS
No. 155 permits fair value measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation, establishes a requirement to evaluate interests in securitized financial assets to
identify interests that are freestanding derivatives or hybrid financial instruments containing embedded derivatives. The adoption of SFAS No. 155 is not expected to have a material impact on the Companys financial position, results of
operations or cash flows.

In July 2006, the FASB issued FASB interpretation No. 48, Accounting for Uncertainty in Income
Taxes, an Interpretation of FASB Statement No. 109 (FIN 48). FIN 48 provides guidance on the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 requires
that we recognize in the financial statements the impact of a tax position if that position more likely than not will be sustained on an audit, based on the technical merits of the position. FIN 48 also provides guidance on derecognition,
classification, interest and penalties, accounting in interim periods, disclosures and transition provisions. The transition adjustment recognized on the date of adoption is recorded as an adjustment to retained earnings as of the beginning of the
adoption period. Management is currently evaluating FIN 48.



13



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



Comparative figures

Certain comparative figures have been adjusted to conform to the current periods presentation.



|3. | Accounts Payable and Accrued Liabilities
|-- | ----------------------------------------

Accounts
payable and accrued liabilities are non-interest bearing, unsecured and have settlement dates within one year.



|4. | Long Term Liabilities
|-- | ---------------------

On April 18, 2007, the
Company issued a total of 5,000,000 authorized preferred shares designated as Series A Preferred Stock (the Series A Preferred Stock), which are convertible into shares of the Companys common stock at a rate of five
common shares for each share of Series A Preferred at any time by the holder or by the Company under certain conditions. The Series A Preferred is also subject to mandatory conversion on the last day of any period of twenty consecutive trading days
ending on or after the sale of the underlying shares of common stock are registered with the Securities and Exchange Commission in which the volume weighted average of the daily market price of the Companys common stock equals or exceeds 200%
of the adjusted conversion price of the Series A Preferred.

The terms of the Series A Preferred entitle the holder to annual cumulative
dividends of $0.09 per share, payable quarterly at the discretion of the Companys Board of Directors. The annual cumulative dividend will be reduced to $0.045 per share upon the Company entering into a commercial agreement(s) that increases
the Companys aggregate revenues to $40,000,000 per annum and to $0.018 per share upon the Company recording net revenues equal to or greater than $1,000,000 per quarter.

The Series A Preferred has a maturity date of five years from the date of closing of the Contribution Agreement (see Note8).

At June 30, 2007, the Company had 5,000,000 shares of Series A Preferred shares outstanding which were issued at $0.90 per share. The Certificate of
Designation for the Series A Preferred includes a mandatory redemption requirement on the maturity date of April 18, 2012 that requires the Company to redeem all of the outstanding shares of its Series A Preferred, to the extent that it has
funds legally available at the time, and to the extent that the Series A Preferred shares have not been converted to shares of common stock, at a redemption price of $1.08 per share. As a result of the mandatory conversion requirement and per SFAS
150, these Series A Preferred shares have been classified as a Long Term Liability. Additionally, the $0.18 per share discount (redemption price of $1.08 less issued price of $0.90) will be recorded as interest expense of $900,000 ($0.18 x 5,000,000
shares) over the 5-year period from April 18, 2007 to April 18, 2012. Accordingly, $36,000 has been recorded as interest expense in the three month period ended June 30, 2007.

The Series A Preferred shares are convertible to common shares at a value of $0.18 per common share at the option of the holder, which price was less than
the fair market value of the underlying common stock when the Series A Preferred shares were issued on April 18, 2007. In accordance with EITF 98-5, this price differential generated a Beneficial Conversion Feature that should be recognized as
a discount against the long-term liability and as an increase to additional paid in capital, since the conversion would be accomplished through the issuance of shares of common stock. The amount of the discount is limited to the proceeds received
from the issuance of the Series A Preferred shares ($4,500,000). In accordance with EITF 00-27, the discount will be accreted to interest expense over the five-year period from the issuance date to the mandatory redemption date of the Series A
Preferred shares. For the three and six months ended June 30, 2007, $180,000 accretion of the discount was recognized as additional interest expense.



14



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



|5. | Long Term Debt
|-- | --------------

As of June 30, 2007, the
Company had $6,000,000 in long term debt due under a note with the Seattle City Employees Retirement System (SCERS). The principal amount outstanding under this note bears interest at a fixed rate equal to 14% per annum, which will
increase to 19% per annum following any event of default under the note. Accrued interest on the outstanding principal is payable on a quarterly basis, and all outstanding principal and interest is due and payable on February 28, 2011. As
additional consideration for making the loan, SCERS will receive quarterly participation payments at the end of each fiscal quarter that are equal to the greater of (i) 5% of the Companys gross revenues on a consolidated basis, or
(ii) 20% of the Companys consolidated net income, for such quarter. The participation payments will continue until SCERS is paid all of the principal and accrued interest under the note, plus an aggregate $6.0 million in participation
payments. SCERS has received no participation payments through the quarter ended June 30, 2007. The note is secured by all of the assets of the Company.



|6. | Capital Stock
|-- | -------------

Authorized

As of June 30, 2007, the Companys total authorized capital was 400,000,000 common shares, with a par value of $0.001 per common share, and
100,000,000 preferred shares, with a par value of $0.001 per preferred share. The Company has designated 5,000,000 preferred shares as Series A Preferred shares.

Issued and outstanding

Under the terms of the Contribution Agreement (Note 8), on April 18,
2007, the Company:



| | a) | issued to the Pro Transferors 55,000,000 unregistered shares of Company common stock;
| | -- | -------------------------------------------------------------------------------------



| | b) | issued to the Investors 5,000,000 shares of Series A Preferred Stock;
| | -- | ---------------------------------------------------------------------



| | c) | issue to Investa Corporation and Ms. Cecelia Pineda 2,500,000 warrants to purchase shares of common stock at a price of $0.26 per share; and
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------



| | d) | cancelled 22,500,000 shares of Company common stock held by Ms. Pineda.
| | -- | -----------------------------------------------------------------------

As of June 30, 2007, the Companys total issued and outstanding capital stock consisted of 75,000,000 common shares, 5,000,000 shares of Series A Preferred and warrants to acquire 2,500,000 common shares.

On February 8, 2007, the Company issued 10,000,000 common shares valued at a price of $0.05 per share upon the exercise of previously
outstanding share purchase warrants. As of June 30, 2007, no share purchase warrants in this series were outstanding.

On
October 11, 2006 the Company incorporated NV Sub in the state of Nevada. Effective October 31, 2006, the Company merged with NV Sub for the purpose of effecting a change of name to Platinum Research Organization, Inc. and a
recapitalization of the Companys capital stock. Pursuant to this transaction, each outstanding share of common stock of the Company was exchanged for and became five shares of NV Sub common stock on the effective date of the transaction. For
accounting purposes, the transaction was accounted for as a recapitalization.



15



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



On March 30, 2006, 10,000,000 Units (the Units) of the Company were issued for cash
proceeds of $100,000. Each Unit consists of one common share of the Company and one fifth of one purchase warrant share. Each full purchase warrant share entitles the holder to purchase an additional five common shares of the Company at a price of
$0.25 per common share expiring March 30, 2009.

Warrants

The following is a summary of warrant activities during the six-month period ended June 30, 2007:



|                                                 |  |                   |   |  |                               |     
|------------------------------------------------ |  | ----------------- | - |  | ----------------------------- | ----
|                                                 |  | Number ofwarrants |   |  | Weightedaverageexercise price
|Outstanding and exercisable at December 31, 2006 |  | 2,000,000         |   |  | $                             | 0.25
|Exercised                                        |  | (2,000,000        | ) |  | $                             | 0.25
|                                                 |  |                   |   |  |                               |     
|Outstanding and exercisable at March 31, 2007    |  |                  |   |  |                               |    
|                                                 |  |                   |   |  |                               |     
|Granted                                          |  | 2,500,000         |   |  | $                             | 0.26
|                                                 |  |                   |   |  |                               |     
|Outstanding and exercisable at June 30, 2007     |  | 2,500,000         |   |  | $                             | 0.26
|                                                 |  |                   |   |  |                               |     



|7. | Equity
|-- | ------

Effective January 1, 2006, the Company
adopted SFAS No. 123R Share Based Payment under the modified prospective method described therein. Compensation expense recognized in the three- and six-month periods ended June 30, 2006 and 2007 includes compensation expense
for all stock-based payments granted, modified or vested since adoption of SFAS No. 123R based on the grant date fair value. Stock-based compensation expense recognized in the three- and six-month periods ended June 30, 2007 was included
in Selling, General and Administrative Expenses and totaled $136,484 and $172,843, respectively. No stock-based compensation was recognized in the three- and six-month periods ended June 30, 2006.

Prior to the consummation of the transactions contemplated by the Contribution Agreement (see Note 8), Platinum LP had issued to key executive officers
and consultants, options to acquire up to 18.685% of limited partner partnership interests in Platinum LP. Following the completion of the transactions contemplated in the Contribution Agreement, the Company issued options to acquire 23,292,184
shares of common stock to holders of the Platinum LP options, in substitution for, and following the cancellation of, the Platinum LP options. The substitution of the Company options for the Platinum LP options complied with Sections 409A and 424 of
the Internal Revenue Code of 1986, as amended, and the Treasury Regulations proposed and issued thereunder. Accordingly, and in addition to the satisfaction of other requirements under these provisions, the ratio of the exercise price to the fair
market value of the shares subject to the Company options issued in substitution of the Platinum LP options immediately following the consummation of the transactions contemplated by the Contribution Agreement was not greater than the ratio of the
exercise price to the fair market value of the canceled Platinum LP options immediately prior to the transaction. Additionally, the excess of the fair market value of the Company options issued in substitution of the Platinum LP options over their
respective strike prices did not exceed the fair market value of the



16



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



Platinum options over their respective strike prices. The fair market value of the Platinum LP options was established by an independent appraisal by Empire
Valuation Consultants, LLC which was completed in August 2007.



|8. | Contribution Agreement
|-- | ----------------------

On October 26, 2006,
the Company entered into a contribution agreement (the Contribution Agreement) with Platinum LP, Lubrication Partners, joint venture (GP Transferor) and sole shareholder of Platinum IP Management, Inc., the general partner of
Platinum LP (PRO GP), each holding a limited partnership interest in Platinum LP (each, a Limited Partner and collectively, the PRO Transferors) and John T. (Cork) Jaeger as the representative of all PRO
Transferors (the PRO Transferor Representative), and Steve Drayton as the representative (the Investor Representative) of all certain individuals who invested in the Company (other than the PRO Transferors) (the
Investors) in a private placement completed in conjunction with the Contribution Agreement.

Under the terms of the Contribution
Agreement, GP Transferor contributed to the Company all of the capital stock of PRO GP, each Limited Partner contributed to the Company all of the outstanding limited partner partnership interests of Platinum LP, and the Investors contributed to the
Company an aggregate minimum cash amount of $4,500,000.

In consideration the Company completed the following:



| | a) | Issued to the PRO Transferors 55,000,000 unregistered shares of common stock of the Company;
| | -- | --------------------------------------------------------------------------------------------



| | b) | Issued to the Investors 5,000,000 shares of Series A Preferred and 2,500,000 share purchase warrants (the Warrants). Each Warrant is exercisable for one common share of
the Company at an exercise price of $0.26 per share for a three-year period from date of closing; and
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | c) | Entered into a bridge loan agreement (the Loan Agreement) with Platinum LP, pursuant to which the Company loaned Platinum LP $1,000,000 (the Platinum LP
Note). The Platinum LP Note bore regular interest at an annual rate of 10% per annum, was due and payable six months from the date of issuance, and was secured by a second lien on all of the assets of Platinum LP. On January 17,
2007, the Company advanced $1,000,000 to Platinum LP under the terms of the Loan Agreement. The Loan Agreement was satisfied on the April 18, 2007 closing date upon the conversion of the promissory note evidencing the loan into shares of Series
A Preferred.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

During the period, the Company entered into an amending agreement whereby the Company will assume certain
general security obligations upon closing of the Contribution Agreement.

At the Companys Special Meeting held on April 12, 2007,
stockholders approved the completion of the proposed Contribution Agreement transaction with Platinum LP et al. The closing of the Contribution Agreement transaction became effective April 18, 2007.



|9. | Commitments
|-- | -----------

On June 20, 2007, the Company
signed a five-year lease for new office space at a rate of approximately $60,000 per year, effective August 15, 2007 (see Note 10). The Company had previously leased office space from EFO Holdings, a related party to Lubrication Partners, L.P.
and Lubrication Partners Joint Venture, our two largest stockholders.



17



---

Platinum Research Organization, Inc. and Subsidiaries

(A Development Stage Company)

Notes to Consolidated Financial
Statements

June 30, 2007



|10. | Subsequent Events
|--- | -----------------

On July 3, 2007, the
Company entered into a $60,000 standby letter of credit agreement with Crescent Real Estate Funding VIII LP as a condition of an office lease, also with Crescent Real Estate Funding VIII LP, entered into on June 20, 2007.

On August 3, 2007, the independent members of the Companys Board of Directors met and approved a proposal to cancel all of the outstanding
employee stock options held by the Companys then Chief Financial Officer, Michael D. Newman, which were granted on April 18, 2007 at an exercise price of $1.35, and reissue 3,116,428 options at an exercise price of $0.79, which was the
closing per share market price of the common stock on August 3, 2007.



|11. | Earnings Per Share
|--- | ------------------

Basic earnings per share are
computed by dividing net earnings less dividends on Series A Preferred by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed similarly to basic earnings per share, except the
denominator is increased by including the number of additional common shares that would have been outstanding if dilutive potential common shares had been issued. This calculation is not done for periods in a loss position as this would be
antidilutive.



|                                             |  |                    |   |  |                  |   |  |                             |   |  |              |   |  |                     |  
|-------------------------------------------- |  | ------------------ | - |  | ---------------- | - |  | --------------------------- | - |  | ------------ | - |  | ------------------- | -
|                                             |  | Three Months Ended |   |  | Six Months Ended |   |  | For the Period from Date of |  
|                                             |  | June 30,2007       |   |  | June 30,2006     |   |  | June 30,2007                |   |  | June 30,2006 |   |  | Inception to6/30/07 |  
|                                             |  | (Restated)         |   |  |                  |   |  | (Restated)                  |   |  |              |   |  | (Restated)          |  
|Numerator                                    |  |                    |   |  |                  |   |  |                             |   |  |              |   |  |                     |  
|Net Income (Loss)                            |  | (1,548,668         | ) |  | (541,786         | ) |  | (2,366,352                  | ) |  | (1,054,976   | ) |  | (8,206,863          | )
|Dividends Declared on Preferred Stock        |  | (93,700            | ) |  |                 |   |  | (93,700                     | ) |  |             |   |  | (93,700             | )
|                                             |  |                    |   |  |                  |   |  |                             |   |  |              |   |  |                     |  
|Net Loss Attributable to Common Shareholders |  | (1,642,368         | ) |  | (541,786         | ) |  | (2,460,052                  | ) |  | (1,054,976   | ) |  | (8,300,563          | )
|Denominator                                  |  |                    |   |  |                  |   |  |                             |   |  |              |   |  |                     |  
|Basic Weighted Average Shares Outstanding    |  | 68,571,429         |   |  | 22,609,890       |   |  | 55,483,425                  |   |  | 27,582,873   |   |  | 29,721,503          |  
|Basic Earnings per Share                     |  | (0.02              | ) |  | (0.02            | ) |  | (0.04                       | ) |  | (0.04        | ) |  | (0.28               | )



|12. | Debt Forgiveness
|--- | ----------------

In April 2004, $5,536,597 of debt
owed by Platinum LP to Lubrication Partners Joint Venture was forgiven in exchange for 100% equity interest in Platinum LP.



18



---

|Item 2. | Managements Discussion and Analysis or Plan of Operation.
|------- | ----------------------------------------------------------

All statements other than statements of historical facts contained in this report, including statements regarding our future financial position, business strategy, budgets, projected costs and plans and objectives of
management for future operations, are considered to be forward-looking statements. We express our expectations, beliefs and projections in good faith and believe our expectations reflected in these forward-looking statements are based on reasonable
assumptions; however, we cannot assure you that these expectations, beliefs or projections will prove to have been correct.

Readers are
referred to the caption Risk Factors appearing at the end of Item 1 of our latest Annual Report on Form 10-KSB for additional factors that may affect our forward-looking statements. In light of these risks, uncertainties and
assumptions, the forward-looking events discussed in this report might not occur. We undertake no obligation to update or revise our forward-looking statements, whether as a result of new information, future events or otherwise.

Plan of Operation

On April 18, 2007, the Company
closed the Contribution Agreement, which resulted in the acquisition of Platinum LP and the appointment of a new slate of directors. Under the terms of the Contribution Agreement:



| |  |  | Lubrication Partners, joint venture (GP Transferor) contributed all of the capital stock of Platinum IP Management, Inc., the general partner of
Platinum LP (PRO GP) (the PRO GP Capital Stock), free and clear of all liens, to the Company;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | each limited partner of Platinum LP contributed all of the outstanding limited partner partnership interests of Platinum LP (collectively, the Partnership
Interests) held by such limited partner, free and clear of all liens, to the Company; and
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | certain individuals who invested in the Company (the Investors) contributed $4,500,000 in new capital by way of private placement to the Company. This
private placement included the conversion of the convertible promissory notes totaling $1,000,000 held by two Investors.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In return, the Company issued the aggregate total of:



| |  |  | 55,000,000 unregistered shares of its common stock to GP Transferor for the PRO GP Capital Stock and for the Partnership Interests;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------



| |  |  | 5,000,000 unregistered shares of Series A Preferred to the Investors; and
| | - |  | -------------------------------------------------------------------------



| |  |  | 2,500,000 unregistered common stock share purchase warrants to Investa Corporation and Ms. Cecelia Pineda.
| | - |  | ----------------------------------------------------------------------------------------------------------

Concurrent with the closing of the Contribution Agreement, Ms. Pineda returned to the Companys treasury 22,500,000 shares of common stock of the
Company held in her name.

The Companys acquisition of Platinum LP has been accounted for as a reverse acquisition application of the
purchase method of accounting by the Company, with Platinum LP being treated as the accounting acquirer. Accordingly, the assets and liabilities of the Predecessor were recorded at their respective historical costs and added to those of Platinum LP,
and the reported results of operations of the Company now and going forward reflect the historical financial and operating results of Platinum LP.

As a result of the foregoing transactions, the Pro Transferors now own 73.33% of the issued and outstanding shares of common stock of the Company on a non-diluted basis and 53.66% of the Companys common stock on a fully-diluted basis.

As a result of our acquisition of Platinum LP, the Companys new business
focus is the design, development and commercialization of patented high-performance lubricants and coatings. The Companys products will be marketed under the trade name TechroBond for automotive, aviation, industrial and consumer
aftermarkets. TechroBondTMis one of a series of product applications Platinum LP developed based on its patented processes and technologies
relating to a fluorinated thiophosphate and a new technique to react zinc dialkyl dithiophosphate (ZDDP) and poly tetra fluroethylene to yield new proprietary compounds that enhance the anti-wear and anti-corrosion capabilities of
lubricants and coatings (individually and collectively, the PRO Technology). The resulting compounds have yielded significantly enhanced anti-wear and anti-corrosion capabilities when measured in bench laboratory tests at the University
of Texas at Arlington, and, more importantly, suggest that the PRO Technology may be a replacement for ZDDP in engine and lubricating oils. Management believes that this new technology will position the Company to penetrate several large, global
markets for lubricants should the Company be successful in bringing its products that rely upon this new technology to market.



19



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The Company intends to develop three primary product lines within the lubricant additive industry,
including greases, industrial oils and engine oils, as well as to develop specialty coatings. A more detailed description of the new business of the Company, associated risk factors, and historical financial statements of Platinum LP are in the
Definitive Schedule 14A Proxy Statement filed with the SEC on April 2, 2007.

Results of Operations

Three Months Ended June 30, 2007 Compared to Three Months Ended June 30, 2006.

Net Sales and Gross Profit. Net sales and gross profit for both the three-month period ended June 30, 2007 and the three-month period ended June 30, 2006 were $0. The Company is a development stage
company and continues to focus its efforts on the marketing and commercialization of the Companys products and technologies, the registration of its products with the Environmental Protection Agency (the EPA), in Europe, Japan and
the Far East and on further developing its relationships with key business partners in the Engine Oil, Grease, Industrial Oil and Coatings markets.

Selling, General and Administrative Expenses.The Companys total SG&A expenses for the three-month period ended June 30, 2007 were $1,034,939, an increase of $789,488 over total SG&A expenses of $245,451 for the
three-month period ended June 30, 2006. Total SG&A expenses are composed of outside legal and professional fees, salaries, insurance costs, product evaluation and technical support and other SG&A expenses.

The Companys outside legal and professional fees for the three-month period ended June 30, 2007 were $395,494, an increase of $322,749 over
outside legal and professional fees of $72,745 for the three-month period ended June 30, 2006. This increase was due to legal and professional costs incurred in connection with the Companys issuance of the Series A Preferred and the
issuance of warrants to acquire 2,500,000 shares of common stock; increased public company compliance costs; recruitment costs associated with hiring a new Chief Financial Officer; and increased product and technology consultancy costs.

The Company incurred $200,317 in costs related to the Contribution Agreement for the three-month period ended June 30, 2007. No such costs were
incurred during the same period in 2006. These costs consisted of outside legal, accounting and audit work related to the Contribution Agreement and related transactions.

The Companys salaries expense for the three-month period ended June 30, 2007 was $244,185, an increase of $171,053 over salaries expense of $73,132 for the three-month period ended June 30, 2006. This
increase was primarily due to non-cash expenses incurred relating to the expensing of stock options pursuant to SFAS 123R, the addition of a new Chief Financial Officer following consummation of the Contribution Agreement and the execution of a new
employment contract for the Companys Chief Executive Officer. Of the total salaries increase, $136,484 related to expensing of stock options.

The Companys insurance costs for the three-month period ended June 30, 2007 were $61,438, an increase of $44,743 over insurance costs of $16,695 for the three-month period ended June 30, 2006. This increase was principally
due to the purchase of a new Directors and Officers Liability Policy.

Product evaluation and technical support expenses for the
three-month period ended June 30, 2007 were $56,558, an increase of $25,183 over product evaluation and technical support expenses of $31,375 for the three-month period ended June 30, 2006. This increase was due to an increase in scope of
the testing and research efforts conducted at the University of Texas - Arlington related to the Companys products and technologies.

Other SG&A expenses for the three-month period ended June 30, 2007 were $22,560, an increase of $12,675 over other SG&A expenses of $9,885 for the three-month period ended June 30, 2006. This increase was due mainly to
increased office support costs.

Depreciation and Amortization.Depreciation for the three-month period ended June 30, 2007 was $122,880, an
increase of $1,052 over depreciation of $121,828 for the three-month period ended June 30, 2006 and relates principally to the amortization of loan issuance costs for debt with the Seattle City Employees Retirement System
(SCERS).

Interest Expense.Interest expense for the three-month period ended June 30, 2007 was $450,794 which was an increase of
$240,794 compared to interest expense of $210,000 for the three-month period ended June 30, 2006.



20



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Interest expense for the three-month period of 2007 was comprised of $210,000 interest related to $6,000,000 of long-term debt with the City of Seattle
Retirement System; $216,000 of interest related to recording the amortization of a beneficial conversion discount and the amortization of a mandatory redemption premium related to the Companys Series A Preferred (please see Note 4 to the
Companys Notes to Financial Statements); and $24,794 of interest on $1,000,000 in short term promissory notes that were settled in April of 2007.

Other Income. Other income for the three-month period ended June 30, 2007 was $59,544, an increase of $24,451 over other income of $35,493 for the three-month period ended June 30, 2006. This increase was due primarily to
interest income from increased cash on hand as a result of equity raised through the Companys issuance of the Series A Preferred Stock and the issuance of warrants to acquire 2,500,000 shares of common stock April 2007.

Six Months Ended June 30, 2007 Compared to Six Months Ended June 30, 2006

Net Sales and Gross Profit.Net sales and gross profit for both the six-month period ending June 30, 2007 and the six-month period ending June 30, 2006 was $0. The Company continues to focus its
efforts on the marketing and commercialization of the Companys products and technologies, the registration of its products with the EPA, in Europe, Japan and the Far East and efforts to further develop its relationships with key business
partners in the Engine Oil, Grease, Industrial Oil and Coatings markets.

Selling, General and Administrative Expenses.The Companys total
SG&A expenses for the six-month period ended June 30, 2007 were $1,548,234, an increase of $1,084,905 over total SG&A expenses of $463,329 for the six-month period ended June 30, 2006. Total SG&A expenses are composed of
outside legal and professional fees, salaries, insurance costs, product evaluation and technical support and other SG&A expenses.

The
Companys outside legal and professional fees for the six-month period ended June 30, 2007 were $526,121, an increase of $381,826 over outside legal and professional fees of $144,295 for the six-month period ended June 30, 2006. This
increase was due to legal and professional costs incurred in connection with the Companys issuance of the Series A Preferred and the issuance of warrants to acquire 2,500,000 shares of common stock; increased public company compliance costs;
recruitment costs associated with hiring a new Chief Financial Officer; and increased product and technology consultancy costs.

The
Company incurred $339,783 in costs related to the Contribution Agreement for the six-month period ended June 30, 2007. No such costs were incurred during the same period in 2006. These costs consisted of outside legal, accounting and audit work
related to the Contribution Agreement and related transactions.

The Companys salaries expense for the six-month period ended
June 30, 2007 was $366,475, an increase of $220,922 over salaries expense of $145,553 for the six-month period ended June 30, 2006. This increase was primarily due to non-cash expenses incurred relating to the expensing of stock options
pursuant to SFAS 123R, the addition of a new Chief Financial Officer following consummation of the Contribution Agreement and the execution of a new employment contract for the Companys Chief Executive Officer. Of the total salaries increase,
$172,483 was related to the expensing of stock options.

The Companys insurance costs for the six-month period ended June 30,
2007 were $78,036, an increase of $52,441 over insurance costs of $25,595 for the six-month period ended June 30, 2006. This increase was principally due to the purchase of a new Directors and Officers Liability Policy.

Product evaluation and technical support expenses for the six-month period ended June 30, 2007 were $108,976, an increase of $36,226 over product
evaluation and technical support expenses of $72,750 for the six-month period ended June 30, 2006. This increase was due to an increase in scope of the testing and research efforts conducted at the University of Texas at Arlington related to
the Companys products and technologies.

Other SG&A expenses for the six-month period ended June 30, 2007 were $36,320, an
increase of $22,627 over other SG&A expenses of $13,693 for the six-month period ended June 30, 2006. This increase was due mainly to increased office support costs.



21



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Depreciation and Amortization.Depreciation for the six-month period ended June 30, 2007 was $245,355, an
increase of $1,915 over depreciation of $243,440 for the six-month period ended June 30, 2006 and relates principally to the amortization of loan issuance costs for debt with SCERS.

Interest Expense.Interest expense for the six-month period ended June 30, 2007 was $660,794, an increase of $240,794 over interest expense of $420,000 for the six-month period ended June 30, 2006,
due mainly to $24,794 in additional interest costs associated with $1,000,000 in convertible promissory notes and $216,000 of interest related to recording the amortization beneficial conversion discount and the amortization of a mandatory
redemption premium related to the Companys Series A Preferred. Both of these entries are non-cash items and are non-recurring (please see Note 4 to the Companys Notes to Financial Statements).

Other Income. Other income for the six-month period ended June 30, 2007 was $88,030, an increase of $16,237 over other income of 71,793 for the six-month
period ended June 30, 2006. This increase was due primarily to interest income from increased cash on hand as a result of equity raised through the Companys issuance of the Series A Preferred Stock and the issuance of warrants to acquire
2,500,000 shares of common stock April 2007.

Research and Development

The Companys research and development expenditures for the six month period ended June 30, 2007 were $108,976 compared to $72,750 for the six month period ended June 30, 2006. The R&D expenditures
are comprised of research staff salaries and materials consumed in the testing and evaluation process. The Company has established an alliance with the University of Texas at Arlington to collaborate on research, development, testing and
commercialization efforts. The number of personnel for each project is reviewed and agreed upon annually by the Company and the University of Texas at Arlington as a part of the budgeting process. The Company is then billed monthly per the budgeting
contract. The Company expenses all such R&D expenditures as incurred. The Company does not track R&D costs by project, as the majority of R&D expenditures for each project are comprised of salaries for research personnel and materials
consumed in testing and evaluation. The Company also utilizes a number of mechanical testing laboratories equipped with a variety of gasoline and diesel engines, driveline and other mechanical equipment to evaluate the performance of additives for
lubricants and fuels.

For the calendar years of 2007 and 2008, there are five key projects, as identified and described below, that
comprise the Companys R&D budget. All of the listed projects are currently active and have research personnel assigned. Company management reviews the project progress on a monthly basis. All of the identified key projects are in progress,
and are expected to continue for the next 12-18 months. As such, the Company is unable to estimate completion dates with any reasonable certainty. The Companys inability to successfully complete or fund these projects could have a material
adverse impact on the Companys ability to execute its business plan.

Grease

The Companys Grease project consists of research into anti-wear and extreme pressure enhancements for lubrication greases. Product development for
the Companys original Grease product, TechroBond 280, is complete. As TechroBond 280 utilizes existing registered materials in its composition, no additional product registration is necessary. The suppliers of raw materials and a contract
manufacturer for manufacturing the material have been contracted by the Company. The Companys ongoing research and development in the Grease project is focused on enhancing the existing TechroBond 280 product and ensuring its compatibility
with customers products.

Coatings

The Companys Coatings project consists of research into anti-fouling paints and anti-corrosion coatings and testing of products to be used in anti-graffiti or other anti-fouling media applications. Product development for this project
is still in the early stages, and no registration of the product or product approvals from regulatory agencies has occurred. Proof of concept testing is currently underway, using a variety of approaches and materials. The early results of the
Companys product testing are promising, but no marketable product has been developed, and there is no assurance that the products can be developed into a marketable product.

Engine Oil (Use of ZDDP in HD Oil Applications)

The Companys Engine Oil ZDDP
Applications project consists of testing the use of fluorinated ZDDP in heavy duty engine oil applications. Product development for this project is in the intermediate stages, and registration of the base materials is currently underway. Product
testing is currently focused on bench wear testing as part of defining the proper blend to be used in a marketable product.

Engine Oil (Improved
Lubrication in Engine Oils)

The Companys Engine Oil Improved Lubrication project consists of research into improved
lubrication in engine oils. Product development for this projects product, TechroBond 240, is in the final stages of development, and the products materials have been registered with the EPA and are currently undergoing testing for
registration in the European Union, which is expected to be completed in the third quarter of 2008. Following European Union registration, further registration will be conducted in additional international jurisdictions. Manufacturing processes have
been defined, and a contract manufacturer has been identified for the manufacture of the product. Actual engine tests utilizing the product are currently being schedules, and should be completed during the first half of 2008.

Testing of Interaction of Anti-Oxidants with F-ZDDP

This project consists of testing the interaction of anti-oxidants and F-ZDDP, as its name suggests. Product development in this project is in the intermediate stages, with registration of the base materials currently underway (see the
Engine Oil (Improved Lubrication in Engine Oils) project description above). This projects product is currently undergoing bench oxidation tests to determine interactions and compatibility with existing engine oil additive packages.



22



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Liquidity and Capital Resources

As of June 30, 2007, the Company had total cash on hand of $5,083,044, of which $1,565,667 was restricted cash. Cash needs during the next twelve
months are expected to average approximately $300,000 per month. As of June 30, 2007, the Company believed it had sufficient funds available to fund operations for approximately the next ten to eleven months.

Cash flows used in operating activities for the six months ended June 30, 2007 were $1,595,891 compared to $815,927 used in operating activities for
the six-month period ended June 30, 2006.

As of June 30, 2007, the Company did not have any material commitments for capital
expenditures. The Company is currently working with a manufacturer in Tulsa, Oklahoma to evaluate the manufacturing process and required capital to produce TechroBond 240. The Company expects that if it is able to receive additional financing in the
first half of 2008, it will complete its evaluation of the manufacturing process and commit to an estimated $1,000,000 in capital expenditures for a manufacturing facility to support the first phase of its production of TechroBond 240.

Net cash provided by financing activities was $5,000,000 for the first six months of 2007, consisting primarily of the private placement of 5,000,000
shares of Series A Preferred for a purchase price of $4,500,000. The Series A Preferred is subject to the terms and conditions of a Certificate of Designation, which terms and conditions include a 10% accrued dividend that will be reduced to a 5%
dividend upon the Company entering into a commercial agreement(s) that will increase the Companys aggregate revenues to $40 million per year, and further reduced to a 2% dividend upon the Company recording net revenues of $1 million per
quarter. Each share of Series A Preferred may be converted into five shares of common stock at anytime by the holder and under certain conditions by the Company. The Series A Preferred must be redeemed by the Company on April 18, 2012, or prior to
that time if the Company fails to fulfill certain obligations to those holders of Series A Preferred for reserving and registering for resale the shares that may be issued upon conversion or upon certain assignments or bankruptcy proceedings.

Immediately following the closing of the Contribution Agreement, Platinum LP became the sole operating subsidiary of the Company, holding
substantially all of the Companys operating assets, other than (i) the intellectual property used by the Company, which is held by Platinum Intellectual Property L.P. (PIP), a wholly-owned subsidiary of Platinum LP, and (ii) the
proceeds of the Series A Preferred offering completed as part of the Contribution Agreement, which are held by the Company directly. On December 3, 2004, the Company and PIP entered into a secured note purchase agreement, which provided for PIP to
obtain a $6.0 million term loan from SCERS (the Seattle Loan).

In connection with the Contribution Agreement, SCERS, the
Company, Platinum LP, PIP, Newlight Capital LLC (Newlight) and JPMorgan Chase Bank, N.A. entered into an amendment of the Seattle Loan on January 9, 2007, which became effective upon the closing of the Contribution Agreement on April 18,
2007. The Seattle Loan is governed by a senior secured note issued by PIP to SCERS. The principal amount outstanding under the Seattle Loan will continue to bear interest at a fixed rate equal to 14% per annum, which will increase to 19% per annum
following any event of default under the senior secured note. Accrued interest on the outstanding principal is payable on a quarterly basis, and all outstanding principal and interest is due and payable on February 28, 2011. As additional
consideration for making the loan, SCERS will receive quarterly participation payments at the end of each fiscal quarter that are equal to the greater of (i) 5% of the Companys gross revenues on a consolidated basis, or (ii) 20% of the
Companys consolidated net income, for such quarter. The participation payments will continue until SCERS is paid all of the principal and accrued interest under the Seattle Loan, plus an aggregate $6.0 million in participation payments. SCERS
has received no participation payments through December 31, 2007.

PIPs performance under the Seattle Loan is secured by all of the
assets of PIP, including all of the registered intellectual property used in the Companys business. In addition, approximately $1.4 million of the loan proceeds were placed in escrow, representing 18 months of estimated interest expense, in
the amount of $1.25 million, and $150,000 of certain estimated fees that are payable in connection with the Seattle Loan.

As amended, the
Seattle Loan is subject to certain financial covenants and restrictions, including limitations on incurring indebtedness or granting liens, mergers or consolidations, distributions, expenditures in excess of budgeted amounts, leases, compensation of
management, sale of assets and capital expenditures, which apply equally to PIP, Platinum LP and the Company. If PIP issues or sells any new promissory note while the Seattle Loan is outstanding that are on terms that are more favorable than those
under the Seattle Loan, as determined in SCERSs sole discretion, then the Seattle Loan will automatically be amended such that those more favorable terms will apply to the Seattle Loan to the same extent as they are to apply under the new
promissory note. PIP may issue one or more new promissory notes having an aggregate principal amount of no more than $9.0 million, and SCERS will take any actions that are necessary in order to permit the purchasers of such notes to have a security
interest and lien that is pari passu with SCERS interests in the collateral securing the Seattle Loan. Any amounts borrowed by PIP that are in excess of the $9.0 million limit shall be subordinate to the Seattle Loan.

Newlight serves as the monitoring agent on behalf of SCERS. In consideration for those services, Newlight received a placement fee of $450,000 at the
initial funding and continues to receive $120,000 in annual monitoring fees after the closing of the Contribution Agreement. Newlight received substitution options for 1,909,938 shares of the Companys common stock upon closing of the
Contribution Agreement, representing approximately 1.50% of the Companys outstanding shares, on a fully-diluted basis, after the closing of the Contribution Agreement. Newlight also serves as a consultant to the Company in connection with its
intellectual property commercialization efforts as well as in raising additional capital. Newlight receives a percentage of the total additional capital raised or revenues generated from intellectual property commercialization as compensation for
such consulting services.

Management cannot provide assurance that the Company will ultimately achieve profitable operations or become
cash flow positive, or raise additional debt and/or equity capital. Management believes that the Companys capital resources are adequate to continue operating and maintaining its current business strategy during the next seven to eight months.
However, if the Company is unable to realize revenue from the commercialization of its products or is unable to raise additional capital in the future, management expects that the Company will need to seek additional capital on less favorable terms
and/or pursue other remedial measures. The financial statements included in this Quarterly Report on Form 10-QSB do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of
liabilities that might be necessary should the Company be unable to continue as a going concern.

Accounting Policies  Intangible Assets

The Company evaluates annually the carrying value of its intellectual property for recoverability by analyzing the expected sales and
profits of its products in the grease, engine oil and industrial oil markets over the next five years. In conducting its impairment analysis, the Company only tests intellectual property being amortized per SFAS 144; non-amortizable intellectual
property is excluded. Amortizable intellectual property was $3,698,207 as of December 31, 2006.

The Companys impairment testing
methodology involves testing the carrying amount of its intellectual property assets compared to the undiscounted cash flows from the Companys estimated operations (excluding interest) for the years 2008 through 2012. While the Company
recognizes that the useful lives of its patents extend beyond 2012 and in some case to the year 2020, the Companys planning period is five years, and data is not available for years beyond 2012.

At December 31, 2006, the Companys impairment testing revealed that the sum of the undiscounted cash flows for the applicable testing period
exceeded the carrying values of amortizable intellectual property. Based on this analysis, the Company expected that sufficient profit will be realized from these sales to recover the balance of intellectual property on its books, and therefore did
not believe that any impairment of its intellectual property existed at December 31, 2006. As such, no impairment adjustment was recorded.

Restatements

Subsequent to the Companys issuance of 5,000,000 shares of Series A Preferred in connection with
the consummation of the Contribution Agreement on April 18, 2007, the Companys Audit Committee and management concluded that changes were necessary to correct the accounting for the Series A Preferred shares in the financial statements for the
three and six months ended June 30, 2007. The Company previously classified the 5,000,000 Series A Preferred shares issued on April 18, 2007 as components of Shareholders Equity. Since the Certificate of Designation for these shares
contains a mandatory redemption date and in accordance with SFAS 150, the Company has determined these



23



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shares should be classified as a long-term liability in accordance with SFAS 150. The correction of this error will required the Series A Preferred shares to
be reflected as a long-term liability on the Companys Balance Sheet. The long-term liability will be increased by $900,000 over the five-year period from the issuance date to the mandatory redemption date of the Preferred shares to reflect the
20% redemption premium contained in the Certificate of Designation for the Series A Preferred. The correction of this error increased interest expense, increased the net loss and increased the long-term liability by $36,000 for the three months and
six months ended June 30, 2007. The recognition of this item did not affect the cash balance of the Company.

The Company also did not
properly calculate or record the intrinsic value of the Beneficial Conversion Feature contained in Series A Preferred shares. The Series A Preferred shares are convertible into shares of the Companys common stock at a value of $0.18 per common
share at the option of the holder, which price was less than the fair market value of the underlying common stock when the Series A Preferred shares were issued on April 18, 2007. In accordance with EITF 98-5, this price differential generated
a Beneficial Conversion Feature which should have been recognized as a discount against the long-term liability and is limited to the proceeds received from the issuance of the Series A Preferred shares. The recognition of the Beneficial Conversion
Feature resulted in a discount of $4,500,000 offsetting the long-term liability for the Series A Preferred shares and a $4,500,000 increase in additional paid-in capital at the issuance date of the Series A Preferred shares. Additionally, in
accordance with EITF 00-27, the discount will be accreted to interest expense over the five-year period from the issuance date to the mandatory redemption date of the Series A Preferred shares, which will result in a reduction of the long term
liability discount and an increase in interest expense over this five year period. The correction of this error increased interest expense, increased the net loss and reduced the Beneficial Conversion Discount by $180,000 for the three and six
months ended June 30, 2007. The recognition of this item did not affect the cash balance of the Company.

The Company also identified
an error in the calculation of compensation cost for the three and six months ended June 30, 2007. On April 18, 2007, options for 3,116,428 shares of common stock were issued at an exercise price of $1.35. The compensation cost related to
the issuance of these stock options was not recorded in the financial statements for the period ended June 30, 2007. Recognizing the additional compensation expense resulted in increased salary expense and an increased net loss of $91,431 for
the three and six months ended June 30, 2007 and did not affect the cash balance of the Company.

The following table reflects the
restatement for each line on the Companys unaudited Consolidated Balance Sheets as of June 30, 2007:



|                                                   |  |                     |           |            |   |            |                 |  |   |            |  
|-------------------------------------------------- |  | ------------------- | --------- | ---------- | - | ---------- | --------------- |  | - | ---------- | -
|                                                   |  | As of June 30, 2007 |          
|Line Item                                          |  | OriginalBalance     |           | Adjustment |   |            | RestatedBalance | 
|Mandatorily Redeemable Preferred Stock             |  | $                   |          |            | $ | 4,500,000  |                 |  | $ | 4,500,000  |  
|Preferred Stock, Beneficial Conversion Discount    |  | $                   |          |            | $ | (4,320,000 | )               |  | $ | (4,320,000 | )
|Preferred Stock, Discount on Convertible Liability |  | $                   |          |            | $ | 36,000     |                 |  | $ | 36,000     |  
|Shareholders Equity                               |  | $                   | 2,627,962 |            | $ | (216,000   | )               |  | $ | 2,411,962  |  



24



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The following table reflects the restatement for each line on the Companys unaudited Consolidated
Statements of Operations for the three and six months ended June 30, 2007:



|                                           |  |                                  |            |   |                                |   |          |                 |  |   |                 |   |  |            |            |   |                 |   |          |   |  |   |            |  
|------------------------------------------ |  | -------------------------------- | ---------- | - | ------------------------------ | - | -------- | --------------- |  | - | --------------- | - |  | ---------- | ---------- | - | --------------- | - | -------- | - |  | - | ---------- | -
|                                           |  | Three Months Ended June 30, 2007 |            |   | Six Months Ended June 30, 2007 |  
|Line Item                                  |  | OriginalBalance                  |            |   | Adjustment                     |   |          | RestatedBalance |  |   | OriginalBalance |   |  | Adjustment |            |   | RestatedBalance |  
|Salaries                                   |  | $                                | 152,754    |   |                                | $ | 91,431   |                 |  | $ | 244,185         |   |  | $          | 275,044    |   |                 | $ | 91,431   |   |  | $ | 366,475    |  
|Total SG&A                                 |  | $                                | 943,508    |   |                                | $ | 91,431   |                 |  | $ | 1,034,939       |   |  | $          | 1,456,803  |   |                 | $ | 91,431   |   |  | $ | 1,548,234  |  
|Interest Expense                           |  | $                                | 234,794    |   |                                | $ | 216,000  |                 |  | $ | 450,794         |   |  | $          | 444,794    |   |                 | $ | 216,000  |   |  | $ | 660,794    |  
|Net Loss Before Taxes                      |  | $                                | (1,241,238 | ) |                                | $ | (307,430 | )               |  | $ | (1,548,668      | ) |  | $          | (2,058,922 | ) |                 | $ | (307,430 | ) |  | $ | (2,366,352 | )
|Net Loss                                   |  | $                                | (1,241,238 | ) |                                | $ | (307,430 | )               |  | $ | (1,548,668      | ) |  | $          | (2,058,922 | ) |                 | $ | (307,430 | ) |  | $ | (2,366,352 | )
|Dividends Declared on Preferred Stock      |  | $                                |           |   |                                | $ | (93,700  | )               |  | $ | (93,700         | ) |  | $          |           |   |                 | $ | (93,700  | ) |  | $ | (93,700    | )
|Net Loss Attributed to Common Shareholders |  | $                                | (1,241,238 | ) |                                | $ | (401,130 | )               |  | $ | (1,642,368      | ) |  | $          | (2,058,922 | ) |                 | $ | (401,130 | ) |  | $ | (2,460,052 | )
|Per Share Amounts                          |  |                                  |            |   |                                |   |          |                 |  |   |                 |   |  |            |            |   |                 |   |          |   |  |   |            |  
|Net Loss                                   |  | $                                | (0.02      | ) |                                | $ |         |                 |  | $ | (0.02           | ) |  | $          | (0.04      | ) |                 | $ |         |   |  | $ | (0.04      | )
|Dividends Declared on Preferred Stock      |  | $                                |           |   |                                | $ |         |                 |  | $ |                |   |  | $          |           |   |                 | $ |         |   |  | $ |           |  
|Net Loss Attributed to Common Shareholders |  | $                                | (0.02      | ) |                                | $ |         |                 |  | $ | (0.02           | ) |  | $          | (0.04      | ) |                 | $ |         |   |  | $ | (0.04      | )

Critical Accounting Policies and Significant Judgments and Estimates

Other than changes mentioned above under Restatements, there have been no material changes in our critical accounting policies or critical
accounting estimates since the filing of our initial registration statement on Form SB-2 in January 2006, nor have we adopted any accounting policy that has or will have a material impact on our consolidated financial statements. For further
discussion of our accounting policies see Note 2, Significant Accounting Policies in the Notes to Financial Statements in this Quarterly Report on Form 10-QSB and the Notes to Consolidated Financial Statements in our Annual Report on
Form 10-KSB for the fiscal year ended December 31, 2006.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements that have or are reasonably likely to have a current of future effect on its financial
condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to its stockholders.



|Item 3. | Controls and Procedures
|------- | -----------------------

Evaluation of Disclosure Controls
and Procedures

Our CEO and CFO have evaluated the effectiveness of our disclosure controls and procedures pursuant to Exchange Act
Rule 13a-15(b) as of the end of the period covered by this report. Our disclosure controls and procedures are designed to ensure that information that is required to be included in our filings with the SEC is recorded, processed, summarized and
reported within the time periods specified by the SEC, and that such information is accumulated and communicated to our management, including our CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Based on that
evaluation, they have concluded that our current disclosure controls and procedures were not effective as of the end of the period covered by this Quarterly Report on Form 10-QSB because of the material weaknesses discussed below.

Identification of a Material Weakness

A
material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected.



25



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As part of managements analysis of comments received from the SEC in the review of a registration
statement previously filed by us, our CFO began an internal review of the accounting treatment of the issuance of the Companys Series A Preferred. Based on the results of this internal review, on March 24, 2008, our Audit Committee
concluded that the Unaudited Condensed Consolidated Balance Sheet as of June 30, 2007, and the related Unaudited Condensed Consolidated Statements of Operations for the three and six month periods ended June 30, 2007, that were presented
in our Quarterly Report on Form 10-QSB for the quarterly period ended June 30, 2007, contained errors relating to the accounting of this financing transaction, and that these Unaudited Condensed Consolidated Financial Statement should be
amended and restated. See Note 2 of the Companys Notes to Condensed Consolidated Financial Statements for a discussion of the nature of these errors.

During the preparation of the financial statements for the year ended December 31, 2007, the Company identified an error in the calculation of compensation cost for the three and six month period ended
June 30, 2007. On April 18, 2007, options for 3,116,428 shares of common stock at an exercise price of $1.35 were issued. On August 3, 2007, these options were cancelled and reissued as an exercise price of $0.79. Although the
cancellation and reissuance of the stock options was disclosed in the previously issued financial statements for the periods ended June 30, 2007, the compensation cost for the April 18, 2007 grant was not recorded in the financial
statements. See Note 2 of the Companys Notes to Condensed Consolidated Financial Statements presented under Item 1 of this Quarterly Report on Form-10QSB for a discussion of this error.

As a result of the restatements described above, our management has determined that material weaknesses existed in our internal controls over financial
reporting with respect to the analysis of and accounting for the financing transaction and stock option grant. Due to the material weaknesses in internal control over financial reporting, our CEO and our CFO concluded that, as of June 30, 2007,
our disclosure controls and procedures were not effective.

Remediation of Material Weaknesses

In March 2008, the Company we identified the need for additional consultative accounting guidance on unusual, infrequent or significant accounting
transactions. In response, the Audit Committee of our Board of Directors engaged Saville, Dodgen & Company, P.A., an independent licensed accounting firm, to provide technical accounting guidance on all financing transactions, equity
transactions and other extraordinary transactions consummated by the Company outside of the ordinary course of business. Saville, Dodgen will provide accounting research and guidance to augment the skills of our internal staff on an ongoing basis.

Upon the March 1, 2008 resignation of our Chief Financial Officer, we identified the need to obtain a licensed CPA to fill the role
of Chief Financial Officer on an interim basis. In March 2008, the Company appointed Mr. David A. Hart as Interim Chief Financial Officer to satisfy this need. Mr. Hart has extensive senior management experience with public and private companies, as
well as significant experience with public company financial reporting. Mr. Hart is performing a major role in ensuring the accuracy and completeness of our financial reporting and the effectiveness of our disclosure controls and procedures.

We believe that the addition of Interim Chief Financial Officer and the engagement of Saville, Dodgen will be sufficient to remediate the
material weaknesses in the Companys disclosure controls and procedures described above.

Changes in Internal Control Over Financial Reporting

Other than that described above, there has not been any change in our internal control over financial reporting, that occurred during the
fiscal quarter covered by this Quarterly Report on Form 10-QSB, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.



26



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PART II - OTHER INFORMATION



|Item 4. | Submission of Matters to a Vote of Security Holders.
|------- | ----------------------------------------------------

On April 12, 2007, the Company held a special meeting of its stockholders. Of the 42,500,000 shares of Company common stock outstanding on the record date for the special meeting, 25,518,050 were represented and voted at the special
meeting. At this meeting, the Companys stockholders voted as indicated on the following proposals submitted to them for consideration:



| | 1. | To approve the Contribution Agreement between the Company and Platinum Research Organization L.P., Lubrication Partners, Platinum IP Management, Inc., each person holding a limited
partnership interest in Platinum Research Organization L.P., John T. (Cork) Jaeger and Steve Drayton on behalf of certain investors.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                       |  |                   |  |                   |  |  |  |  |  | 
|---------------------- |  | ----------------- |  | ----------------- |  |  |  |  |  | 
|FOR:        25,518,050 |  | AGAINST:        0 |  | ABSTAIN:        0



| | 2. | To approve the reincorporation of the Company from the State of Nevada to the State of Delaware pursuant to a merger of the Company with and into a newly formed Delaware corporation
that is currently a wholly owned subsidiary of the Company.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                       |  |                   |  |                  
|---------------------- |  | ----------------- |  | -----------------
|FOR:        25,518,050 |  | AGAINST:        0 |  | ABSTAIN:        0



| | 3. | To adopt a new Certificate of Incorporation and new Bylaws under the laws of the State of Delaware.
| | -- | ---------------------------------------------------------------------------------------------------



|                       |  |                   |  |                  
|---------------------- |  | ----------------- |  | -----------------
|FOR:        25,518,050 |  | AGAINST:        0 |  | ABSTAIN:        0



| | 4. | To adopt the Platinum Research Organization, Inc. Stock Incentive Plan.
| | -- | -----------------------------------------------------------------------



|                       |  |                   |  |                  
|---------------------- |  | ----------------- |  | -----------------
|FOR:        25,518,050 |  | AGAINST:        0 |  | ABSTAIN:        0



| | 5. | To appoint six new directors to the Companys Board of Directors.
| | -- | -----------------------------------------------------------------



|                        |  |            |  |         |  |        
|----------------------- |  | ---------- |  | ------- |  | -------
|                        |  | FOR        |  | AGAINST |  | ABSTAIN
|Thomas G. Plaskett      |  | 25,518,050 |  | 0       |  | 0      
|John T. (Cork) Jaeger |  | 25,518,050 |  | 0       |  | 0      
|Allan McArtor           |  | 25,518,050 |  | 0       |  | 0      
|Arnold Burns            |  | 25,518,050 |  | 0       |  | 0      
|Ben Du Pont             |  | 25,518,050 |  | 0       |  | 0      
|Mike McMillan           |  | 25,518,050 |  | 0       |  | 0      

No other business was presented, and there were no broker non-votes.



|Item 6. | Exhibits.
|------- | ---------



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|----------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|            | 
|2.1         |  | Contribution Agreement, dated October 26, 2006, by and among Platinum Research Organization, LP, Lubrication Partners, joint venture, Platinum IP Management, Inc., John T. (Cork) Jaeger as the
representative of the partners of Platinum Research Organization, LP, and Steve Drayton as the representative of all certain individuals who invested in the Company in a private placement completed in conjunction with the Contribution Agreement
(incorporated by reference to Exhibit 2.1 filed with the Companys Current Report on Form 8-K/A-1 dated October 26, 2006).
|            | 
|2.2         |  | Amendment to Contribution Agreement dated December 26, 2006. (incorporated by reference to Exhibit 4.1 filed with the Companys Current Report on Form 8-K dated January 9,
2007).                                                                                                                                                                                                                                                                                                                                                                                              



27



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|     |  |                                                                                                                                                                                                                                                                                  
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     | 
|2.3  |  | Amendment to Contribution Agreement dated February 28, 2007. (incorporated by reference to Exhibit 4.1 filed with the Companys Current Report on Form 8-K dated February 28,
2007).                                                                                             
|     | 
|3.1  |  | Certificate of Incorporation of Platinum Research Organization, Inc.*                                                                                                                                                                                                            
|     | 
|3.2  |  | Bylaws of Platinum Research Organization, Inc.*                                                                                                                                                                                                                                  
|     | 
|4.1  |  | Certificate of Designations for Series A Preferred Stock (incorporated by reference to Exhibit 4.1 to the Companys Current Report on Form 8-K dated April 18,
2007).                                                                                                          
|     | 
|4.2  |  | Registration Rights Agreement, dated April 18, 2007, between the Company, the investors named therein, Investa Corporation and Cecilia Pineda (incorporated by reference to Exhibit 4.4 filed with
the Companys Current Report on Form 8-K dated October 26, 2006).             
|     | 
|4.3  |  | Lock-Up Agreement, dated April 18, 2007, between the Company, Lubrication Partners, Joint Venture and Lubrication Partners, L.P Pineda (incorporated by reference to Exhibit 4.7 filed with the
Companys Current Report on Form 8-K dated October 26, 2006).                    
|     | 
|4.4  |  | Voting Agreement, dated April 18, 2007, between the Company, Lubrication Partners, Joint Venture and Lubrication Partners, L.P. Pineda (incorporated by reference to Exhibit 4.6 filed with the
Companys Current Report on Form 8-K dated October 26, 2006).                    
|     | 
|10.1 |  | Consulting Agreement, dated April 14, 2007, between Platinum Research Organization, Inc., The Fairmount Company and John T. Jaeger, Jr. (incorporated by reference to Exhibit 10.1 filed with the
Companys Quarterly Report on Form 10-QSB for the period ended March 31, 2007).
|     | 
|10.2 |  | Platinum Research Organization, Inc. Stock Incentive Plan (incorporated by reference to Exhibit E of the Companys Proxy Statement on Schedule 14A filed on April 2,
2007).                                                                                                      
|     | 
|31.1 |  | Certificate of CEO as Required by Rule 13a-14(a)/15d-14.                                                                                                                                                                                                                         
|     | 
|31.2 |  | Certificate of CFO as Required by Rule 13a-14(a)/15d-14.                                                                                                                                                                                                                         
|     | 
|32.1 |  | Certificate of CEO and CFO as Required by Rule 13a-14(b) and Rule 15d-14(b) (17 CFR 240.15d-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code.                                                                                                         



|* | Filed previously.
|- | -----------------



28



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SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.



|                     |  |  |  |                                      |  |                         |  |                                                                        
|-------------------- |  |  |  | ------------------------------------ |  | ----------------------- |  | -----------------------------------------------------------------------
|                     |  |  |  | PLATINUM RESEARCH ORGANIZATION, INC.
|                     |  |  | 
|Date: March 31, 2008 |  |  |  | By:                                  |  | /s/ John T. Jaeger, Jr.
|                     |  |  |  |                                      |  |                         |  | John T. Jaeger, Jr.                                                    
|                     |  |  |  |                                      |  |                         |  | President, Chief Executive Officer and Member of the Board of Directors
|                     |  |  | 
|Date: March 31, 2008 |  |  |  | By:                                  |  | /s/ David A. Hart      
|                     |  |  |  |                                      |  |                         |  | David A. Hart                                                          
|                     |  |  |  |                                      |  |                         |  | Interim Chief Financial Officer                                        



29