**U.S. Securities and ExchangeCommission**

**Washington, D.C. 20549**

 

**FORM 10-Q**

 

[ X ]*           *QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended April 30th, 2009

 

or

 

[   ]              TRANSITION REPORT  PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES AND EXCHANGE ACT OF 1934

 

For the transition period from _____________________

Commission File No. 333-145884

 

**Emo Capital Corp.**

---------------------------------------------

(Name of small business issuer inits charter)

 

| **Nevada**
**N/A**
			(State of Incorporation)
			(I.R.S. Employer Identification No.)
 

**115 He Xiang Road, Bai HeVillage, Qing Pu, Shanghai, China, 200000**

---------------------------------------------------------------------------------------------------------

(Address of principal executiveoffices)

 

**604-267-0111**

----------------------------------

(Registrant's telephone number,including area code)

 

**-**

-------------------------

(Former name, address and fiscalyear, if changed since last report)

Indicate by check mark whether the Registrant (1) has filedall reports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorter periodthat the Registrant was required to file such reports), and (2) has been subjectto such filing requirements for the past 90 days. Yes X No o 

Indicate by check mark whether the registrant is a largeaccelerated filer, an accelerated filer, a non-accelerated filer or a smallerreporting company. See the definitions of "large accelerated filer,""accelerated filer" and "smaller reporting company" in Rule 12b-2 of theExchange Act. (Check one):

Large accelerated filer o		 
		Accelerated filer o		 
		Non-accelerated filer o		(Do not check if a smaller reporting company)
Smaller		reporting company X		 
Indicate by check mark whether the Registrant is a shellcompany (as defined in Rule 12b-2 of Exchange Act)Yes X No o 

The number of shares outstanding of the Registrant's commonstock, par value $.001 per share, at June 20, 2009 was 5,000,000 shares. 

 

 

1

 

Part I - FINANCIAL INFORMATION

**Emo Capital Corp.**

**(A Development Stage Company)**

**Balance Sheets**

 
**April 30,**
**July 31,**
 
**2009**
**2008**
 
**(Unaudited)**
 
**ASSETS**
**Current Assets**
 
 
Cash and cash equivalents
			$                  260
			$             7,636
**Total Current Assets**
260
7,636
 
 
 
**TOTAL ASSETS**
** $                  260**
**$         7,636**
 
 
 
**LIABILITIES AND			STOCKHOLDERS' EQUITY (DEFICIT)**
 
 
 
**Current Liabilities**
 
 
Accounts payable and accrued liabilities
			$             502
			$           502
Shareholder loan
10,882
5,083
**Total Current Liabilities**
11,384
5,585
 
 
 
 
**Stockholders' Equity (Deficit)**
 
 
Common stock
 
 
Authorized: $0.001 par value, 75,000,000 shares			authorized
 
 
Issued and Outstanding
 
 
5,000,000 common shares
5,000
5,000
Additional paid in capital
27,000
27,000
Deficit, accumulated during the development			stage
			(43,125)
			(29,949)
**Total Stockholders' Equity (Deficit)**
			(11,125)
2,051
 
 
 
**TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY			(DEFICIT)**
**$                   260**
**$             7,636**
 
 
 
 

**The accompanying notes are anintegral part of these financial statements.**

 

**Emo Capital Corp.**

**(A Development Stage Company)**

**Statements of Operations**

**(Unaudited)**

    

 
**For the**
**For the**
**From			August 23, 2006**
 
**Three Months Ended**
**Nine Months Ended**
**(Inception) to**
 
**April 30,**
**April 30,**
**April 30,**
**April 30,**
**April 30,**
 
**2009**
**2008**
**2009**
**2008**
**2009**
 
 
 
 
 
 
**General and Administrative Expenses**
			 
 
			 
 
			 
Professional Fees
$ 600
$ 872
$			12,717
$ 5,172
$			41,989
Management Fees
-
-
-
-
350
Filing Fee
-
-
348
-
398
Bank charges and interest
-
254
111
362
388
**Total General and Administrative Expenses**
600
1,127
13,576
5,534
43,125
 
 
 
 
 
 
**Net (Loss) for the Period**
$ (600)
$			(1,123)
$			(13,176)
$			(5,534)
$			(43,125)
 
 
 
 
 
 
**Net Loss per Share**
 
 
 
 
 
Basic and diluted net loss per common share
(0.00)
(0.00)
(0.00)
(0.00)
 
 
 
 
 
 
 
Weighted Average Number of Shares (Basic and			Diluted)
			5,000,000
			2,000,000
			5,000,000
			2,000,000
 
**The accompanying notes are anintegral part of these financial statements.**

 

 

**Emo Capital Corp.**

**(A Development Stage Company)**

**Statements of Cash Flows**

**(Unaudited)**

 
			 
 
			 
 
**For the**
**From			August 23, 2006**
 
**Nine Months ended**
**(Inception) to**
 
**April 30,**
**April 30,**
**April 30**,
 
**2009**
**2008**
**2009**
**Cash Provided by (Used for)**
 
 
 
**Operating Activities**
 
 
 
Net profit (loss) for the period
$			(13,176)
$			(5,534)
$			(43,125)
Changes in:
 
 
 
Prepaid Expense
-
1,000
-
Accounts payable and accrued liabilities
-
(903)
502
**Cash used for operating activities**
			(13,176)
(5.437)
			(42,623)
 
 
 
 
**Cash from Financing Activities**
 
 
 
Proceeds from shareholder loan
5,799
4,805
10,882
Cash received for shares issued
-
-
32,000
**Cash provided by financing activities**
5,799
4,805
42,882
 
 
 
 
**Cash increase (decrease) during the period**
(7,376)
632
260
 
 
 
 
**Cash and cash equivalents, beginning of			period**
7,636
505
-
**Cash and cash equivalents, end of period**
$ 260
$ (127)
$ 260
 
 
 
 
**Supplementary Information**
 
 
 
Interest Paid
-
-
-
Income Taxes Paid
-
-
-
**The accompanying notes are anintegral part of these financial statements.**

 

 

**Emo Capital Corp.**

**(A Development Stage Company)**

**NOTES TO FINANCIAL STATEMENTS**

**For the year ended January 31,2009**

**Note 1.    -      NATURE ANDCONTINUANCE OF OPERATIONS**

The Company is a development stagecompany which was incorporated in the State of Nevada, United States of Americaon August 23, 2006. The Company intends to commence operations a e-commercewebsite which acts as medium with which to facilitate communication betweenInternet users.

These financial statements have beenprepared on a going concern basis. The Company has accumulated a deficit of$43,125 since inception and has not yet to achieve profitable operations andfurther losses are anticipated in the development of its business, raisingsubstantial doubt about the Company's ability to continue as a going concern.Its ability to continue as a going concern is dependent upon the ability of theCompany to generate profitable operations in the future and or to obtain thenecessary financing to meet its obligations and repay its liabilities arisingfrom normal business operations when they come due. Management plans to continueto provide for its working capital needs by seeking loans from its shareholder.These financial statements do not include any adjustments to the recoverabilityand classification of assets, or the amount and classification of liabilitiesthat may be necessary should the Company be unable to continue as a goingconcern.

The company's year-end is July 31.

**Note 2.    -      SUMMARY OFSIGNIFICANT ACCOUNTING POLICIES**

The financial statements of theCompany have been prepared in accordance with accounting principles generallyaccepted in the United States of America. Because a precise determination ofmany assets and liabilities is dependent upon future events, the preparation offinancial statements for a period necessarily involves the use of estimates,which have been made using careful judgment. Actual results may vary from theseestimates.

The financial statements have, inmanagement's opinion, been properly prepared within the framework of thesignificant accounting policies summarized below:

*Cash and Cash Equivalents*

Cash equivalents comprise certainhighly liquid instruments with a maturity of three months or less whenpurchased. As at April 30th, 2009, there were no cash equivalents.

*Development Stage Company*

The Company complies with Statementof Financial Accounting Standard ("SFAS") No. 7 and the Securities and ExchangeCommission Exchange Act 7 for its characterization of the Company as developmentstage. 

*Impairment of Long Lived Assets*

Long-lived assets are reviewed forimpairment in accordance with SFAS No. 144, "Accounting for the Impairment orDisposal of Long- lived Assets". Under SFAS No. 144, long-lived assets aretested for recoverability whenever events or changes in circumstances indicatethat their carrying amounts may not be recoverable. An impairment charge isrecognized or the amount, if any, which the carrying value of the asset exceedsthe fair value. 

*Foreign Currency Translation*

The Company is located and operatingoutside of the United States of America. It maintains its accounting records inU.S. Dollars, as follows:

At the transaction date, each asset,liability, revenue, and expense is translated into U.S. dollars by the use ofexchange rates in effect at that date. At the period end, monetary assets andliabilities are remeasured by using the exchange rate in effect at that date.The resulting foreign exchange gains and losses are included in operations.

The Company's currency exposure isinsignificant and immaterial and we do not use derivative instruments to reduceits potential exposure to foreign currency risk.

*Financial Instruments*

The carrying value of the Company'sfinancial instruments consisting of cash equivalents and accounts payable andaccrued liabilities approximates their fair value because of the short maturityof these instruments. Unless otherwise noted, it is management's opinion thatthe Company is not exposed to significant interest, currency or credit risksarising from these financial instruments.

*Income Taxes*

The Company uses the assets andliability method of accounting for income taxes in accordance with SFAS No. 109"Accounting for Income Taxes".  Under this method, deferred tax assts andliabilities are recognized for the future tax consequences attributable totemporary differences between the financial statements carrying amounts ofexisting assets and liabilities and their respective tax bases. Deferred taxassets and liabilities are measured using enacted tax rates expected to apply totaxable income in the years in which those temporary differences are expected tobe recovered or settled.

*Basic and Diluted Net Loss PerShare*

In accordance with SFAS No. 128,"Earnings Per Share', the basic net loss per common share is computed bydividing net loss available to common stockholders by the weighted average    number of common shares outstanding. Diluted net loss per common share iscomputed similar to basic net loss per common share except that the denominatoris increased to include the number of additional common shares that would havebeen outstanding if the potential common shares had been issued and if theadditional common shares were dilutive. As at April 30, 2009, diluted net lossper share is equivalent to basic net loss per share.

*Stock Based Compensation*

The Company accounts for stockoptions and similar equity instruments issued in accordance with SFAS No.123(revised), " Share-Based Payment".  Accordingly, compensation costsattributable to stock options or similar equity instruments granted are measuredat the fair value at the grant date, and expensed over the expected vestingperiod.   Transactions in which goods or services are received in exchange forthe issuance of equity instruments are accounted for based on the fair value ofthe consideration received or the fair value of the equity instruments issued,whichever is more reliably measurable.   SFAS No. 123(revised) requires excesstax benefits be reported as a financing cash inflow rather than as a reductionof taxes paid.

The Company did not grant any stockoptions during the period ended April 30, 2009.

*Comprehensive Income*

The Company adopted Statement ofFinancial Accounting Standards No. 130 (SFAS 130), Reporting ComprehensiveIncome, which establishes standards for reporting and display of comprehensiveincome, its components and accumulated balances. The Company is disclosing thisinformation on its Statement of Stockholders' Equity.  Comprehensive incomecomprises equity except those resulting from investments by owners anddistributions to owners.  

The Company has no elements of"other comprehensive income" during the period ended April 30, 2009.

*Advertising Expenses*

The company expenses advertisingcosts as incurred. There was no advertising expense incurred by the companyduring the period ended April 30, 2009.       

*New Accounting Standards*

Management does not believe that anyrecently issued, but not yet effective accounting standards if currently adoptedcould have a material effect on the accompanying financial statements.

**Note 3.    -      CAPITAL STOCK**

On July 15, 2007, the Company issued2,000,000 common shares at $0.001 per share to the sole director of the Companyfor total proceeds of $2,000.

In May, 2008, the Company issued3,000,000 common shares at $0.01 per share to subscribers for total proceeds of$30,000.

**Note 4.    -      RELATED PARTYTRANSACTIONS**

The Company's sole officer hasloaned the company $10,882, without interest and fixed term of repayment.

 

**Item 2: Management's Discussion and Analysis of Financial Condition andResults of Operations**

*Caution about Forward-Looking Statements*

This quarterly report contains forward-looking statements. These statementsrelate to future events or our future financial performance. In some cases, youcan identify forward-looking statements by terminology such as "may", "should","expects", "plans", "anticipates", "believes", "estimates", "predicts","potential" or "continue" or the negative of these terms or other comparableterminology. These statements are only predictions and involve known and unknownrisks, uncertainties and other factors, that may cause our or our industry'sactual results, levels of activity, performance or achievements to be materiallydifferent from any future results, levels of activity, performance orachievements expressed or implied by these forward-looking statements. Althoughwe believe that the expectations reflected in the forward-looking statements arereasonable, we cannot guarantee future results, levels of activity, performanceor achievements. Except as required by applicable law, including the securitieslaws of the United States, we do not intend to update any of the forward-lookingstatements to conform these statements to actual results.

Our unaudited financial statements are stated in United States Dollars (US$)and are prepared in accordance with United States Generally Accepted AccountingPrinciples. The following discussion should be read in conjunction with ourfinancial statements and the related notes that appear elsewhere in thisquarterly report. The following discussion contains forward-looking statementsthat reflect our plans, estimates and beliefs. Our actual results could differmaterially from those discussed in the forward looking statements. Factors thatcould cause or contribute to such differences include, but are not limited to,those discussed below and elsewhere in this quarterly report.

In this quarterly report, unless otherwise specified, all dollar amounts areexpressed in United States dollars. All references to "US$" refer to UnitedStates dollars and all references to "common shares" refer to the common sharesin our capital stock.

As used in this quarterly report, the terms "we", "us", "our", "our company"and "Emo" mean Emo Capital Corp., unless otherwise indicated. 

*Overview*

Emo Capital Corp. was incorporated in the state of Nevada on August 23, 2006.Emo intends to create and develop a new social networking website which will bean online utility that connects youths in the age groups between 12-18 whostudy, and work together. The website will be targeted to the Chinese speakingmarket and will initially be advertised to users in China, Taiwan, and HongKong. We expect that we will have a working, beta stage software by the end ofJune 2009. We currently have not advanced beyond the business plan state fromour inception until the date of this filing. We plan to raise initial seedfinancing through the sale of our common shares as described in this offering.The initial seed financing will be put towards designing and writing software,and paying for costs related to registering the Company's common stock forpublic sale. We anticipate that in order for us to begin commercialization ofthe website, we will need to raise additional capital. We currently do not haveany specific plans to raise these funds. 

*Results of Operations  *

The Company experienced general and administration expenses of $600 and$1,127 for the three month period ended April 30, 2009 and 2008 respective. Thedecrease in general and administration expenses for this period are attributedto a reduction professional fees and bank charges and interest.

For the three month period ended April 30, 2009, the company experienced anet loss of $600, and has experienced a total deficit of $43,125 sinceinception.

Liquidity and Capital Resources   

During the three month period ended April 30, 2009, the Company satisfied itsworking capital needs by using loans from the Company's officer. As of April 30,2009, the Company has cash on hand in the amount of $260. Management does notexpect that the current level of cash n hand will be sufficient to fund ouroperations for the next twelve month period. In the event that additional fundsare required to maintain operations, our officers and directors have agreed toadvance us sufficient capital to allow us to continue operations. We may also beable to obtain loans from our shareholders, but there are no agreements orunderstandings in place currently.

We believe we will require additional funding to expand our business andensure its future profitability. We anticipate that any additional funding willbe in the form of equity financing from the sale of our common stock. However,we do not have any arrangements in place for any future equity financing. In theevent we are not successful in selling our common stock, we may also seek toobtain short-term loans from our director. 

 

**Item 3. Quantitative Disclosures About Market Risks**

As a "smaller reporting company", we are not required to provide theinformation required by this Item.

**Item 4. Controls and Procedures**

We maintain disclosure controls and procedures that are designed to ensurethat information required to be disclosed in our reports filed under theSecurities Exchange Act of 1934, as amended, is recorded, processed, summarizedand reported within the time periods specified in the Securities and ExchangeCommission's rules and forms, and that such information is accumulated andcommunicated to our management, including our president (our principal executiveofficer, principal accounting officer and principal financial officer) to allowfor timely decisions regarding required disclosure. In designing and evaluatingour disclosure controls and procedures, our management recognizes that anycontrols and procedures, no matter how well designed and operated, can provideonly reasonable assurance of achieving the desired control objectives, and ourmanagement is required to apply its judgment in evaluating the cost-benefitrelationship of possible controls and procedures. 

As of April 30, 2009, the end of the three month period year covered by thisreport, our president (our principal executive officer, principal accountingofficer and principal financial officer) carried out an evaluation of theeffectiveness of the design and operation of our disclosure controls andprocedures. Based on the foregoing, our president (our principal executiveofficer, principal accounting officer and principal financial officer) concludedthat our disclosure controls and procedures were effective as of the end of theperiod covered by this annual report. 

There have been no changes in our internal controls over financial reportingthat occurred during the period ended April 30, 2009 that have materiallyaffected, or are reasonably likely to materially affect, our internal controlsover financial reporting. 

 

 

PART II: OTHER INFORMATION

**Items 1. Legal Proceedings**

We know of no material, existing or pending legal proceedings against ourcompany, nor are we involved as a plaintiff in any material proceeding orpending litigation. There are no proceedings in which any of our directors,officers or affiliates, or any registered or beneficial shareholder, is anadverse party or has a material interest adverse to our interest. 

**Item 1A. Risk Factors**

Much of the information included in this quarterly report includes or isbased upon estimates, projections or other "forward looking statements". Suchforward looking statements include any projections or estimates made by us andour management in connection with our business operations. While theseforward-looking statements, and any assumptions upon which they are based, aremade in good faith and reflect our current judgment regarding the direction ofour business, actual results will almost always vary, sometimes materially, fromany estimates, predictions, projections, assumptions or other future performancesuggested herein.

Such estimates, projections or other "forward looking statements" involvevarious risks and uncertainties as outlined below. We caution the reader thatimportant factors in some cases have affected and, in the future, couldmaterially affect actual results and cause actual results to differ materiallyfrom the results expressed in any such estimates, projections or other "forwardlooking statements".

Our common shares are considered speculative during the development of ournew business operations. Prospective investors should consider carefully therisk factors set out below.

RISKS RELATED TO OUR BUSINESS

*Our auditors have issued a going concern opinion. This means we may not beable to achieve our objectives and may have to suspend or cease operations.*

Our auditors have issued a going concern opinion as at June 20, 2009. Thismeans that there is substantial doubt that we can continue as an ongoingbusiness without additional financing and/or generating profits. If we areunable to do so, we will have to cease operations and you will lose yourinvestment.

*Because all of our assets and our officer and director is located outsidethe United States of America, it may be difficult for an investor to enforcewithin the United States any judgments obtained against us or our officer anddirector.*

All of our assets are located outside of the United States and we do notcurrently maintain a permanent place of business within the United States. Inaddition, our director and officer is a national and/or resident of a countryother than the United States, and all or a substantial portion of such persons'assets are located outside the United States. As a result, it may be difficultfor an investor to effect service of process or enforce within the United Statesany judgments obtained against us or our officer or director, includingjudgments predicated upon the civil liability provisions of the securities lawsof the United States or any state thereof. In addition, there is uncertainty asto whether the courts of China and other jurisdictions would recognize orenforce judgments of United States courts obtained against us or our directorand officer predicated upon the civil liability provisions of the securitieslaws of the United States or any state thereof, or be competent to hear originalactions brought in China or other jurisdictions against us or our director andofficer predicated upon the securities laws of the United States or any statethereof.

*Because we have only one officer and director who are responsible for ourmanagerial and organizational structure, in the future, there may not beeffective disclosure and accounting controls to comply with applicable laws andregulations which could result in fines, penalties and assessments against us.*

We have only one officer and director. He is responsible for our managerialand organizational structure which will include preparation of disclosure andaccounting controls under the Sarbanes Oxley Act of 2002. When theses controlsare implemented, they will be responsible for the administration of thecontrols. Should they not have sufficient experience, they may be incapable ofcreating and implementing the controls which may cause us to be subject tosanctions and fines by the SEC which ultimately could cause you to lose yourinvestment.

*Because we do not maintain any insurance, if a judgment is renderedagainst us, we may have to cease operations.*

We do not maintain any insurance and do not intend to maintain insurance inthe future. Because we do not have any insurance, if we are made a party to alawsuit, we may not have sufficient funds to defend the litigation. In the eventthat we do not defend the litigation or a judgment is rendered against us, wemay have to cease operations. 

*Because all of our assets and our sole officer and director is locatedoutside the United States of America, it may be difficult for an investor toenforce within the United States any judgments obtained against us or  ourofficer and director.*

All of our assets are located outside of the United States. In addition, ourdirector and officer is a national and/or resident of countries other than theUnited States, and all or a substantial portion of such persons' assets arelocated outside the United States. As a result, it may be difficult for aninvestor to effect service of process or enforce within the United States anyjudgments obtained against us or our officer or director, including judgmentspredicated upon the civil liability provisions of the securities laws of theUnited States or any state thereof. In addition, there is uncertainty as towhether the courts of China or China or other jurisdictions would recognize orenforce judgments of United States courts obtained against us or our directorand officer predicated upon the civil liability provisions of the securitieslaws of the United States or any state thereof, or be competent to hear originalactions brought in China or other jurisdictions against us, our sole officer anddirector predicated upon the securities laws of the United States or any statethereof.

*If we are not able to effectively respond to competition, our business mayfail.*

There are many small software developers that sell software products whichare similar to our proposed business venture. Most of these competitors haveestablished businesses with a established customer base. We will attempt tocompete against these groups by offering a much higher quality product comparedto our competitors products with a more customizable product. However, we cannotassure you that such a strategy will be successful, or that competitors will notcopy our business strategy. Our inability to achieve sales and revenues due tocompetition will have an adverse effect on our business operations and financialcondition.

*We need to raise additional investment capital in the future in order tocommence our business operations.*

If we are unable to raise the required investment capital, you may lose allof your investment In the current economic environment; it is extremelydifficult for companies without profits or revenues, such as us, to raisecapital. We currently do not have a specific plan of how we will obtain suchfunding; however, we anticipate that additional funding will be in the form ofequity financing from the sale of our common stock. In the event we are notsuccessful in selling our common stock, we may also seek to obtain short-termloans from our director, although no such arrangement has been made. At thistime, we cannot provide investors with any assurance that we will be able toraise sufficient funding from the sale of our common stock or through a loanfrom our director to meet our initial capital requirement needs. If we areunable to raise the required financing, we will be unable to proceed with ourbusiness plan and you may lose your entire investment.

*Because our articles of incorporation authorize the issuance of 75,000,000shares of common stock, an investor faces the risk of having their percentageownership diluted in the future.*

We anticipate that any additional funding will be in the form of equityfinancing from the sale of our common stock. In the future, if we do sell morecommon stock, your investment could be subject to dilution. Dilution is thedifference between what you pay for your stock and the net tangible book valueper share immediately after the additional shares are sold by us. These sharesmay also be issued without security holder approval and, if issued, may begranted voting powers, rights, and preferences that differ from and may besuperior to those of the registered shares.

RISKS RELATED TO OUR COMMON STOCK

*Trading in our common shares on the OTC Bulletin Board is limited andsporadic making it difficult for our shareholders to sell their shares orliquidate their investments.*

Our common shares are currently listed for public trading on the OTC BulletinBoard. The trading price of our common shares has been subject to widefluctuations. Trading prices of our common shares may fluctuate in response to anumber of factors, many of which will be beyond our control. The stock markethas generally experienced extreme price and volume fluctuations that have oftenbeen unrelated or disproportionate to the operating performance of companieswith no current business operation. There can be no assurance that tradingprices and price earnings ratios previously experienced by our common shareswill be matched or maintained. These broad market and industry factors mayadversely affect the market price of our common shares, regardless of ouroperating performance.

In the past, following periods of volatility in the market price of acompany's securities, securities class-action litigation has often beeninstituted. Such litigation, if instituted, could result in substantial costsfor us and a diversion of management's attention and resources.

*Our stock is a penny stock. Trading of our stock may be restricted by theSEC's penny stock regulations which may limit a stockholder's ability to buy andsell our stock.*

Our stock is a penny stock. The Securities and Exchange Commission hasadopted Rule 15g-9 which generally defines "penny stock" to be any equitysecurity that has a market price (as defined) less than $5.00 per share or anexercise price of less than $5.00 per share, subject to certain exceptions. Oursecurities are covered by the penny stock rules, which impose additional salespractice requirements on broker-dealers who sell to persons other thanestablished customers and "accredited investors". The term "accredited investor"refers generally to institutions with assets in excess of $5,000,000 orindividuals with a net worth in excess of $1,000,000 or annual income exceeding$200,000 or $300,000 jointly with their spouse. The penny stock rules require abroker-dealer, prior to a transaction in a penny stock not otherwise exempt fromthe rules, to deliver a standardized risk disclosure document in a form preparedby the SEC which provides information about penny stocks and the nature andlevel of risks in the penny stock market. The broker-dealer also must providethe customer with current bid and offer quotations for the penny stock, thecompensation of the broker-dealer and its salesperson in the transaction andmonthly account statements showing the market value of each penny stock held inthe customer's account. The bid and offer quotations, and the broker-dealer andsalesperson compensation information, must be given to the customer orally or inwriting prior to effecting the transaction and must be given to the customer inwriting before or with the customer's confirmation. In addition, the penny stockrules require that prior to a transaction in a penny stock not otherwise exemptfrom these rules; the broker-dealer must make a special written determinationthat the penny stock is a suitable investment for the purchaser and receive thepurchaser's written agreement to the transaction. These disclosure requirementsmay have the effect of reducing the level of trading activity in the secondarymarket for the stock that is subject to these penny stock rules. Consequently,these penny stock rules may affect the ability of broker-dealers to trade oursecurities. We believe that the penny stock rules discourage investor interestin and limit the marketability of our common stock.

*The Financial Industry Regulatory Authority, or FINRA, has adopted salespractice requirements which may also limit a stockholder's ability to buy andsell our stock.*

In addition to the "penny stock" rules described above, FINRA has adoptedrules that require that in recommending an investment to a customer, abroker-dealer must have reasonable grounds for believing that the investment issuitable for that customer. Prior to recommending speculative low pricedsecurities to their non-institutional customers, broker-dealers must makereasonable efforts to obtain information about the customer's financial status,tax status, investment objectives and other information. Under interpretationsof these rules, FINRA believes that there is a high probability that speculativelow priced securities will not be suitable for at least some customers. FINRArequirements make it more difficult for broker-dealers to recommend that theircustomers buy our common stock, which may limit your ability to buy and sell ourstock and have an adverse effect on the market for our shares.

**Item 2 Unregistered Sales of Equity Securities and Use of Proceeds**

None

**Item 3 Defaults Upon Senior Securities**

None

**Item 4 Submission of Matters to a Vote of Security Holders**

None

**Item 5 Other Information**

None

**Item 6: Exhibits**

(a)   The following exhibit is filed as part of this report:

        31.1  Certification of Principal Executive Officer and PrincipalFinancial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of2002 

        32.1  Certification of Principal Executive Officer and PrincipalFinancial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant toSection 906 of the Sarbanes-Oxley Act of 2002

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Actof 1934, the registrant has duly caused this report to be signed on its behalfby the undersigned thereunto duly authorized June 20, 2009

 

June 20, 2009
/s/  Juanming Fang__________________
 
Mr. Juanming Fang, President
 

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