-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TQtemHFG74bRs4ebffEP8fY1bxS5zcqFbvTCCBEdte/V/TStKIDWgqbkPbuEaJqn GG2jdcfXtoMe2WnZW+n7Mw== 0001165527-09-000572.txt : 20090813 0001165527-09-000572.hdr.sgml : 20090813 20090813124257 ACCESSION NUMBER: 0001165527-09-000572 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20090630 FILED AS OF DATE: 20090813 DATE AS OF CHANGE: 20090813 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SeaOspa Inc CENTRAL INDEX KEY: 0001451598 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-MISCELLANEOUS RETAIL [5900] IRS NUMBER: 261359430 STATE OF INCORPORATION: NV FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-53640 FILM NUMBER: 091009423 BUSINESS ADDRESS: STREET 1: 3-6 HA'HISHTADRUT STREET CITY: KIRYAT YAM STATE: L3 ZIP: 29056 BUSINESS PHONE: 972(52)247-2966 MAIL ADDRESS: STREET 1: 3-6 HA'HISHTADRUT STREET CITY: KIRYAT YAM STATE: L3 ZIP: 29056 10-Q 1 g3361.txt QTRLY REPORT FOR THE QTR ENDED 6-30-09 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended June 30, 2009 or [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ Commission File Number 000-53640 SEAOSPA, INC. (Exact name of registrant as specified in its charter) Nevada 26-1548693 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 3 Ha'hishtadrut St. Suite #6, Kiryat Yam, Israel 29056 (Address of principal executive offices) (Zip Code) Telephone: +1 (877) 841-5343 (Registrant's telephone number, including area code) Not Applicable (Former name, former address, and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate by checkmark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [X] (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X ] No [ ] There were 4,869,918 shares of common stock $0.0001 par value per share, outstanding on August 11, 2009. TABLE OF CONTENTS Page ---- PART I. Financial Information: Item 1. Financial Statements 3 Balance Sheets Statement of Operations Statement of Stockholder's Equity Statement of Cash Flows Notes to Financial Statements June 30, 2009 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3. Quantitative and Qualitative Disclosures About Market Risk 14 Item 4/4T. Controls and Procedures 14 PART II. Other Information: Item 1. Legal Proceedings 15 Item 1A. Risk Factors 15 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 15 Item 3. Defaults Upon Senior Securities 15 Item 4. Submission of Matters to a Vote of Security Holders 15 Item 5. Other Information 15 Item 6. Exhibits 15 Signatures 16 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS SEAOSPA INC. (A DEVELOPMENT STAGE COMPANY) BALANCE SHEETS June 30, 2009
June 30, December 31, 2009 2008 -------- -------- (Unaudited) (Audited) ASSETS Current Assets Cash in bank $ 39,241 $ 49,228 -------- -------- Total current assets 39,241 49,228 -------- -------- Total Assets $ 39,241 $ 49,228 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Accounts payable $ 160 $ -- -------- -------- Total current liabilities 160 -- -------- -------- Stockholders' Equity Preferred Stock, par value $0.0001 per share, 50,000,000 shares authorized, none outstanding Common Stock, par value $0.0001 per share, 100,000,000 shares authorized, 4,869,918 shares issued and outstanding 487 487 Additional paid-in capital 56,511 56,511 (Deficit) accumulated during the development stage (17,917) (7,770) -------- -------- Total stockholders' equity 39,081 49,228 -------- -------- Total Liabilities and Stockholders' Equity $ 39,241 $ 49,228 ======== ========
The Accompanying Notes Are an Integral Part of these Financial Statements 3 SEAOSPA, INC. (A DEVELOPMENT STAEGE COMPANY) STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Six Months Ended November 2, 2007 June 30, June 30, (Inception) To ------------------------- ------------------------- June 30, 2009 2008 2009 2008 2009 ---------- ---------- ---------- ---------- ---------- Sales $ -- $ -- $ -- $ -- $ 2,476 Cost of Goods Sold -- -- -- -- 1775 ---------- ---------- ---------- ---------- ---------- Gross Profit -- -- -- -- 701 Operating Expenses Legal fees 1,000 808 3,500 1,587 10,629 Filing Fees 1,070 -- 1,704 -- 1,994 General and Administrative 211 49 443 62 595 Organization Cost -- -- -- -- 900 Accounting Cost 2,500 -- 4,500 -- 4,500 ---------- ---------- ---------- ---------- ---------- Total Operating Expenses 4,781 857 10,147 1,649 18,618 ---------- ---------- ---------- ---------- ---------- Loss before income taxes $ (4,781) $ (857) $ (10,147) $ (1,649) $ (17,917) ---------- ---------- ---------- ---------- ---------- Provision for Income Taxes -- -- -- -- -- ---------- ---------- ---------- ---------- ---------- Net (Loss) $ (4,781) $ (857) $ (10,147 $ (1,649) $ (17,917) ========== ========== ========== ========== ========== Basic and Diluted (Loss) per Common Shares a a a a ---------- ---------- ---------- ---------- Weighted Average Number of Common shares 4,869,918 3,000,000 4,869,918 3,000,000 ---------- ---------- ---------- ----------
- ---------- a = Less than ($0.01) per share The Accompanying Notes Are an Integral Part of these Financial Statements 4 SEAOSPA, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited)
Common Stock --------------------- Paid in Accumulated Total Shares Amount Capital Deficit Equity ------ ------ ------- ------- ------ # $ $ $ $ Inception November 2, 2007 Common stock issued to Directors 3,000,000 300 600 900 for cash November 2, 2007 @ $0.0003 per share Net loss for the year (900) (900) ---------- ------ ------- -------- -------- Balance, December 31, 2007 3,000,000 300 600 (900) -- Private placement closed on 1,869,918 187 55,911 56,098 November 20, 2008 @ 0.03 per share Net loss for the year (6,870) (6,870) ---------- ------ ------- -------- -------- Balance, December 31, 2008 4,869,918 487 56,511 (7,770) 49,228 Net loss for the period (10,147) (10,147) ---------- ------ ------- -------- -------- BALANCE, JUNE 30, 2009 4,869,918 487 56,511 (17,917) 39,081 ========== ====== ======= ======== ========
The Accompanying Notes Are an Integral Part of these Financial Statements 5 SEAOSPA, INC. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF CASH FLOWS (Unaudited)
Six Months Ended November 2, 2007 June 30, (Inception) To -------------------- June 30, 2009 2008 2009 -------- -------- -------- OPERATING ACTIVITIES Net (Loss) $(10,147) $ (1,649) $(17,917) Adjustments to Reconcile Net Loss to Net Cash Used by Operating Activities -- -- -- Accounts payable and accrued liabilities 160 -- 160 -------- -------- -------- Net Cash (Used) by Operating Activities (9,987) (1,649) (17,757) -------- -------- -------- FINANCING ACTIVITIES Proceeds from issuance of common stock -- 11,063 56,998 -------- -------- -------- Cash Provided by Financing Activities -- 11,063 56,998 -------- -------- -------- Net Increase (Decrease) in Cash (9,987) 9,414 39,241 Cash, Beginning of Period 49,228 -- -- -------- -------- -------- Cash, End of Period $ 39,241 $ 9,414 $ 39,241 ======== ======== ========
The Accompanying Notes Are an Integral Part of these Financial Statements 6 SEAOSPA, INC. (A DEVELOPMENT STAGE COMPANY) NOTES TO FINANCIAL STATEMENTS JUNE 30, 2009 NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS The Company was incorporated under the laws of the state of Nevada on November 2, 2007. The Company has limited operations and in accordance with SFAS #7, is considered a development stage company and has not yet realized any revenues from its planned operations. The business plan of the Company is to purchase and distribute Dead Sea skin and hair care products from Israel. At this stage, the only operations are the development of our website and business plan. As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES UNAUDITED INTERIM FINANCIAL STATEMENTS The interim financial statements of the Company as of June 30, 2009, and for the periods ended, and cumulative from inception, are unaudited. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary to present fairly the Company's financial position as of June 30, 2009, and the results of its operations and its cash flows for the periods ended June 30, 2009, and cumulative from inception. These results are not necessarily indicative of the results expected for the calendar year ending December 31, 2009. The accompanying financial statements and notes thereto do not reflect all disclosures required under accounting principles generally accepted in the United States. Refer to the Company's audited financial statements as of December 31, 2008, filed with the SEC, for additional information, including significant accounting policies. BASIS OF ACCOUNTING The Company's financial statements are prepared using the accrual method of accounting. The Company has elected a December 31 fiscal year end. EARNINGS PER SHARE In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share" ("SFAS No. 128"), which specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. SFAS No. 128 supersedes the provisions of APB No. 15, and requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share. The Company has adopted the provisions of SFAS No. 128 effective November 2, 2007 (inception). Basic earnings (loss) per share amounts are computed by dividing the net income (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company. CASH EQUIVALENTS The Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying value of the Company's financial instruments, consisting of accounts payable and accrued liabilities, approximates their fair value due to the short-term maturity of such instruments. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements. 7 REVENUE RECOGNITION The Company recognizes revenues when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is probable. COST OF SALES Cost of sales consists of merchandise and shipping costs, INCOME TAXES Income taxes are provided in accordance with Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS 109"). A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry forwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. SOFTWARE DEVELOPMENT COSTS Software development costs represent capitalized costs of design, configuration, coding, installation and testing of the Company's website up to its initial implementation. Upon implementation, the asset will be amortized to expense over its estimated useful life of three years using the straight-line method. Ongoing website post-implementation costs of operation, including training and application maintenance, will be charged to expense as incurred. RECENT ACCOUNTING PRONOUNCEMENTS In April 2009, the FASB issued FSP No. FAS 157-4, "Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly" ("FSP FAS 157-4"). FSP FAS 157-4 provides guidance on estimating fair value when market activity has decreased and on identifying transactions that are not orderly. Additionally, entities are required to disclose in interim and annual periods the inputs and valuation techniques used to measure fair value. This FSP is effective for interim and annual periods ending after June 15, 2009. The Company does not expect that the adoption of FSP FAS 157-4 will have a material impact on its financial condition or results of operation. In October 2008, the FASB issued FSP No. FAS 157-3, "Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active," ("FSP FAS 157-3"), which clarifies application of SFAS 157 in a market that is not active. FSP FAS 157-3 was effective upon issuance, including prior periods for which financial statements have not been issued. The adoption of FSP FAS 157-3 had no impact on the Company's results of operations, financial condition or cash flows. In December 2008, the FASB issued FSP No. FAS 140-4 and FIN 46(R)-8, "Disclosures by Public Entities (Enterprises) about Transfers of Financial Assets and Interests in Variable Interest Entities." This disclosure-only FSP improves the transparency of transfers of financial assets and an enterprise's involvement with variable interest entities, including qualifying special-purpose entities. This FSP is effective for the first reporting period (interim or annual) ending after December 15, 2008, with earlier application encouraged. The Company adopted this FSP effective January 1, 2009. The adoption of the FSP had no impact on the Company's results of operations, financial condition or cash flows. 8 In December 2008, the FASB issued FSP No. FAS 132(R)-1, "Employers' Disclosures about Postretirement Benefit Plan Assets" ("FSP FAS 132(R)-1"). FSP FAS 132(R)-1 requires additional fair value disclosures about employers' pension and postretirement benefit plan assets consistent with guidance contained in SFAS 157. Specifically, employers will be required to disclose information about how investment allocation decisions are made, the fair value of each major category of plan assets and information about the inputs and valuation techniques used to develop the fair value measurements of plan assets. This FSP is effective for fiscal years ending after December 15, 2009. The Company does not expect the adoption of FSP FAS 132(R)-1 will have a material impact on its financial condition or results of operation. In September 2008, the FASB issued exposure drafts that eliminate qualifying special purpose entities from the guidance of SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities," and FASB Interpretation 46 (revised December 2003), "Consolidation of Variable Interest Entities - an interpretation of ARB No. 51," as well as other modifications. While the proposed revised pronouncements have not been finalized and the proposals are subject to further public comment, the Company anticipates the changes will not have a significant impact on the Company's financial statements. The changes would be effective March 1, 2010, on a prospective basis. In June 2008, the FASB issued FASB Staff Position EITF 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities, ("FSP EITF 03-6-1"). FSP EITF 03-6-1 addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting, and therefore need to be included in the computation of earnings per share under the two-class method as described in FASB Statement of Financial Accounting Standards No. 128, "Earnings per Share." FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning on or after December 15, 2008 and earlier adoption is prohibited. We are not required to adopt FSP EITF 03-6-1; neither do we believe that FSP EITF 03-6-1 would have material effect on our financial position and results of operations if adopted. In May 2008, the Financial Accounting Standards Board ("FASB") issued SFAS No. 163, "Accounting for Financial Guarantee Insurance Contracts-and interpretation of FASB Statement No. 60". SFAS No. 163 clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement of premium revenue and claims liabilities. This statement also requires expanded disclosures about financial guarantee insurance contracts. SFAS No. 163 is effective for fiscal years beginning on or after December 15, 2008, and interim periods within those years. SFAS No. 163 has no effect on the Company's financial position, statements of operations, or cash flows at this time. In May 2008, the Financial Accounting Standards Board ("FASB") issued SFAS No. 162, "The Hierarchy of Generally Accepted Accounting Principles". SFAS No. 162 sets forth the level of authority to a given accounting pronouncement or document by category. Where there might be conflicting guidance between two categories, the more authoritative category will prevail. SFAS No. 162 will become effective 60 days after the SEC approves the PCAOB's amendments to AU Section 411 of the AICPA Professional Standards. SFAS No. 162 has no effect on the Company's financial position, statements of operations, or cash flows at this time. In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities--an amendment of FASB Statement No. 133. This standard requires companies to provide enhanced disclosures about (a) how and why an entity uses derivative instruments, (b) how derivative instruments and related hedged items are accounted for under Statement 133 and its related interpretations, and (c) how derivative instruments and related hedged items affect an entity's financial position, financial performance, and cash flows. This Statement is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. SFAS No. 161 has no effect on the Company's financial position, statements of operations, or cash flows at this time. In December 2007, the SEC issued Staff Accounting Bulletin (SAB) No. 110 regarding the use of a "simplified" method, as discussed in SAB No. 107 (SAB 107), in developing an estimate of expected term of "plain vanilla" share options in accordance with SFAS No. 123 (R), Share-Based Payment. In particular, the staff indicated in SAB 107 that it will accept a company's election to use the simplified method, regardless of whether the company has sufficient information to make more refined estimates of expected term. At the time SAB 107 was issued, the staff believed that more detailed external information about employee exercise behavior (e.g., employee exercise patterns by industry and/or other categories of companies) would, over time, become readily available to companies. Therefore, the staff stated in SAB 107 that it would not expect a company to use the simplified method for share option grants after December 31, 2007. The staff understands that such detailed information about employee exercise behavior may not be widely available by December 31, 2007. Accordingly, the staff will continue to accept, under certain circumstances, the use of the simplified method beyond December 31, 2007. It is not believed that this will have an impact on the Company's financial position, results of operations or cash flows. 9 In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements--an amendment of ARB No. 51. This statement amends ARB 51 to establish accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. Before this statement was issued, limited guidance existed for reporting noncontrolling interests. As a result, considerable diversity in practice existed. So-called minority interests were reported in the consolidated statement of financial position as liabilities or in the mezzanine section between liabilities and equity. This statement improves comparability by eliminating that diversity. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008 (that is, January 1, 2009, for entities with calendar year-ends). Earlier adoption is prohibited. The effective date of this statement is the same as that of the related Statement 141 (revised 2007). It is not believed that this will have an impact on the Company's financial position, results of operations or cash flows. In December 2007, the FASB, issued FAS No. 141 (revised 2007), Business Combinations'. This Statement replaces FASB Statement No. 141, Business Combinations, but retains the fundamental requirements in Statement 141. This Statement establishes principles and requirements for how the acquirer: (a) recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree; (b) recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase; and (c) determines what information to disclose to enable users of the financial statements to evaluate the nature and financial effects of the business combination. This statement applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. An entity may not apply it before that date. The effective date of this statement is the same as that of the related FASB Statement No. 160, Noncontrolling Interests in Consolidated Financial Statements. It is not believed that this will have an impact on the Company's financial position, results of operations or cash flows. NOTE 3. ADVERTISING The Company's policy regarding advertising is to expense advertising when incurred. The Company had not incurred any advertising expense as of June 30, 2009. NOTE 4. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has net losses for the period from November 2, 2007 (inception) to June 30, 2009 of $17,917. This condition raises substantial doubt about the Company's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Management is planning to raise additional funds through debt or equity offerings. There can be no assurance that debt or equity financing will be available to the Company on acceptable terms or at all, and there is no guarantee that the Company will be successful in these efforts. NOTE 5. RELATED PARTY TRANSACTIONS The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts. As described in Note 8, on November 2, 2007, the Company issued 3,000,000 common shares to its directors for cash, valued at $0.0003 per share or $900. NOTE 6. INCOME TAXES The Company uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. During fiscal 2008, the Company incurred net losses and, therefore, has no tax liability. The net deferred tax asset generated by the loss carry-forward has been fully reserved. The cumulative net operating loss carry-forward is $17,917 at June 30, 2009, and will expire in the year 2028. 10 As at June 30, 2009, deferred tax assets consisted of the following: Net operating losses $ 4,120 Less: valuation allowance (4,120) ------- Net deferred tax asset $ -- ======= NOTE 7. NET OPERATING LOSSES As of June 30, 2009, the Company has a net operating loss carry-forward of approximately $17,917, which will expire 20 years from the date the loss was incurred. NOTE 8. STOCKHOLDERS' EQUITY AUTHORIZED The Company is authorized to issue 100,000,000 shares of $0.0001 par value common stock and 50,000,000 shares of preferred stock, par value $0.0001. All common stock shares have equal voting rights, are non-assessable and have one vote per share. Voting rights are not cumulative and, therefore, the holders of more than 50% of the common stock could, if they choose to do so, elect all of the directors of the Company. ISSUED AND OUTSTANDING For transactions other than those involving employee's stock, issuances are in accordance with paragraph 8 of SFAS 123, where issuances shall be accounted for based on the fair value of the consideration received. Transactions with employee's stock issuance are in accordance with paragraphs (16-44) of SFAS 123, where issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is the more reliable measure. On November 2, 2007, the Company issued 3,000,000 common shares to its directors for cash, valued at $0.0003 per share or $900. From inception (November 2, 2007) until the year ended December 31, 2008, the Company accepted subscriptions for 1,869,918 shares of common stock from 40 investors pursuant to a series of private placement transactions which closed on November 20, 2008. The private placements were not subject to any minimum investment, and were priced at $0.03 per share, for aggregate gross proceeds of approximately $56,098. The Company accepted the subscriptions on November 20, 2008. The Company has commenced an activity to submit a Registration Statement on Form S-1 to the Securities and Exchange Commission ("SEC") to register 1,869,918 of its outstanding shares of common stock on behalf of selling stockholders. The Company will not receive any of the proceeds of this registration activity once the shares of common stock are sold. The Registration Statement was declared effective April 20, 2009. NOTE 9. CONCENTRATION OF CREDIT RISK The Company's cash and cash equivalents are invested in a major bank in Israel and are not insured. Management believes that the financial institution that holds the Company's investments are financially sound and accordingly, minimal credit risk exists with respect to these investments. NOTE 10. COMMITMENTS On January 22, 2009, the Company entered into a Transfer Agent Agreement with Island Capital Management, LLC dba Island Stock Transfer for services. Under the Agreement, the Company agreed to pay to Island Stock Transfer fees amounting to $10,000 for a 12 months Premier Services Plan. 11 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FORWARD LOOKING STATEMENTS This quarterly report on Form 10-Q contains certain forward-looking statements. Forward-looking statements may include our statements regarding our goals, beliefs, strategies, objectives, plans, including product and service developments, future financial conditions, results or projections or current expectations. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of such terms, or other comparable terminology. Such forward-looking statements appear in this Item 2 - "Management's Discussion and Analysis of Financial Condition and Results of Operations," and include statements regarding our expectations regarding our short - and long-term capital requirements and our business plan and estimated expenses for the coming 12 months. These statements are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results to be materially different from those contemplated by the forward-looking statements. The business and operations of SeaOspa, Inc. are subject to substantial risks, which increase the uncertainty inherent in the forward-looking statements contained in this report. We undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Further information on potential factors that could affect our business is described under the heading "Risks Related To Our Business" in "Risk Factors" in our registration statement on Form S-1 (File no. 333-157175), which was declared effective on April 20, 2009. Readers are also urged to carefully review and consider the various disclosures we have made in this report. OVERVIEW We are an early stage company with limited operations and no, or minimal, revenues from our business operations. We were incorporated under the laws of the state of Nevada on November 2, 2007. We are engaged in the marketing of skin care, hair care and body treatment products. Currently we are focusing on marketing of Dead Sea products from Israel. The Company operates its own retail online store where we sell our products direct to consumers at www.seaospa.com. We intend to open and operate an eBay store in addition to our own online store within the next twelve months. Our target market is adults of 18 years of age and up. We have two executive officers who also serve as our directors. Mr. Terner, our President, Treasurer and a Director, resides in Israel. He has fourteen years of experience marketing and distributing Dead Sea products from Israel in Romania. Mr. Yossi Benitah, our Secretary and a Director, resides in Israel. He has thirty years of experience as an entrepreneur operating an electrical services company in Israel. Neither of our officers lives in Nevada, the state of our incorporation, or the United States. From November 2, 2007 (inception) to December 31, 2008, we have incurred accumulated net losses of $17,917. Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt as to whether we can continue as an ongoing business for the next twelve months. On March 25, 2008, we entered into a service agreement with Yahoo!(R) and we launched our ecommerce online store. Yahoo!(R) provides us with the ecommerce online store, web hosting and our business mail at a cost of $39.95 a month. Our service agreement with Yahoo!(R) can be terminated at any time and is on a month to month basis. PLAN OF OPERATIONS Our officers and directors, are responsible for all planning, developing and operational duties, and will continue to do so throughout the early stages of our growth. We have no intention of hiring employees until the business has been successfully launched and we have sufficient, reliable revenue from operations. Our officers and directors are planning to do whatever work is required until our business to the point of having positive cash flow. Our main objectives: * Continue to promote our online retail store. This process is expected to be an ongoing process. * Set up an eBay Store: - Building and customizing the store - Managing sales - Promoting the store. - Tracking store traffic and sales 12 In order to attract more traffic to our online store we are in the process of setting up an additional online store on eBay, we hope to gain more exposure to our Dead Sea products. This process is expected to be finish on September 2009. We expect to be in a position to generate revenue by October 2009 in order to fund all expenditures under our 12 month budget. RESULTS OF OPERATIONS THREE MONTHS ENDED JUNE 30, 2009 COMPARED TO THE THREE MONTHS ENDED JUNE 30, 2008 AND SIX MONTHS ENDED JUNE 30, 2009 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2008 AND CUMULATIVE FROM INCEPTION (NOVEMBER 2, 2007) TO JUNE 30, 2009 During the three months ended June 30, 2009, we incurred operating expenses of $4,781, an increase of $3,924 from the period three months ended June 30, 2008. Operating expenses increased during the period ended June 30, 2009 from the comparative period due to an overall increase in our activity and increased expenses as a result of being a reporting company. Significant elements include: * Legal fees of $1,000, which is an increase from $808 during the three months ended June 30, 2008. The fees are associated with the S1 Registration Statement. * Accounting cost of $2,500, which is an increase from $0 during the three months ended June 30, 2008. The cost is associated with review of financial statements for the period ended June 30, 2009. * Filing fees of $1,070, which is an increase from $0 during the three month ended June 30, 2008. The fees are associated with Edgarizing and filing the reports with the SEC. During the six months ended June 30, 2009, we incurred operating expenses of $10,147, an increase of $8,498 from the period six months ended June 30, 2008. Significant elements include: * Legal fees of $3,500, which is an increase from $1,587 during the six months ended June 30, 2008. The fees are associated with the S1 Registration Statement. * Accounting costs of $4,500, which is an increase from $0 during the six months ended June 30, 2008. The cost is associated with audit and review of financial statements. * Filing fees of $1,704, which is an increase from $0 during the six months ended June 30, 2008. The fees are associated with Edgarizing and filing the reports with the SEC. NET LOSS We incurred a net loss of $4,781 for the three months ended June 30, 2009, compared to a net loss of $857 for the three months ended June 30, 2008, $10,147 for the six months ended June 30, 2009, compared to a net loss of $1,649 for the six months ended June 30, 2008. During the period from November 2, 2007 (date of inception) through June 30, 2009, we incurred a net loss of $17,917. This loss consisted primarily of professional fees and administrative expenses. Since inception, we have sold 4,869,918 shares of common stock. LIQUIDITY AND CAPITAL RESOURCES To date, we have had negative cash flows from operations and we have been dependent on sales of our equity securities to meet our cash requirements. We expect this to continue for the foreseeable future. We anticipate that we will have negative cash flows from operations in the next twelve month period. As of June 30, 2009, we had cash of $39,241, representing a net decrease in cash of $9,987 since December 31, 2008. Cash generated by financing activities during the six months ended June 30, 2009 amounted to $0. Cash used in operating activities amounted to $9,987, mainly resulting from a net loss of $10,147 and adjusted by accounts payable of $160. Cash generated by financing activities during the six months ended June 30, 2008 amounted to $11,063 and related to proceeds from issuance of common stock. Cash used in operating activities during the six months ended June 30, 2008 amounted to $1,649, resulting from a net loss of $1,649. 13 How long SeaOspa will be able to satisfy its cash requirements depends on how quickly our company can generate revenue and how much revenue can be generated. We estimate that our current cash balances will be extinguished prior to the end of October 2009, provided we do not have any unanticipated expenses. Although there can be no assurance at present, we plan to be in a position to generate revenues prior to the end of the year. We must generate at least $16,439 in revenues in order to fund all expenditures under our 12-months budget. If we fail to generate sufficient revenues, we will need to raise additional funds for the future development of our business, or to respond to unanticipated requirements or expenses. We do not currently have any arrangements for financing and we can provide no assurance to investors we will be able to find such financing. There can be no assurance that additional financing will be available to us, or on terms that are acceptable. Consequently, we may not be able to proceed with our intended business plans or complete the development and commercialization of our product. There are also no plans or expectations to purchase or sell any significant equipment in the first year of operations. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable. ITEM 4T. CONTROLS AND PROCEDURES As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended, (the "1934 Act") as of the end of the period covered by this quarterly report, being the fiscal quarter ended June 30, 2009, we have carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon the results of that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures were ineffective, as they did not provide reasonable assurance that material information related to our company is recorded, processed and reported in a timely manner. The small size of our company makes the proper identification and authorization of transactions difficult, as the company has essentially only two individuals overseeing this process. Given our company's small size, we also have difficulties with separation of duties for handling, approving and coding invoices, entering transactions into the accounts, writing checks and requests for wire transfers. Additionally, the Company's officers are also its sole board members. This does not provide an adequate level of layers of internal controls, which in turn make it difficult to accumulate information required to be disclosed by our company in the reports that it files or submits under the 1934 Act. Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were ineffective as of June 30, 2009. There was no change to our internal control over financial reporting that occurred during the quarter ended June 30, 2009 that has materially affected, or is reasonably likely to materially affect the Company's internal control over financial reporting. 14 PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None. ITEM 1A. RISK FACTORS Not applicable. 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 Pursuant to Item 601 of Regulation S-K, the following exhibits are included herein. Exhibit Description - ------- ----------- 31.1 Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2 Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 32.2 Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 15 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SEAOSPA, INC. (the Registrant) Date: August 11, 2009 By: /s/ Yakov Terner ---------------------------------------- Name: Yakov Terner Title: President, Treasurer and Director Date: August 11, 2009 By: /s/ Yossi Benitah ---------------------------------------- Name: Yossi Benitah Title: Secretary and Director 16 EX-31.1 2 ex31-1.txt CEO SECTION 302 CERTIFICATION EXHIBIT 31.1 RULE 13A-14(A)/15D-14(A) CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER I, Yakov Terner certify that: 1. I have reviewed this Quarterly Report on Form 10-Q of SeaOspa Inc; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting Date: August 11, 2009 By: /s/ Yakov Terner ------------------------------------- Name: Yakov Terner Title: President, Treasurer and Director EX-31.2 3 ex31-2.txt CFO SECTION 302 CERTIFICATION EXHIBIT 31.2 RULE 13A-14(A)/15D-14(A) CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER I, Yossi Benitah, certify that: 1. I have reviewed this Quarterly Report on Form 10-Q of SeaOspa, Inc; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the period presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and c) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: August 11, 2009 By: /s/ Yossi Benitah ------------------------------------ Name: Yossi Benitah Title: Secretary and Director EX-32.1 4 ex32-1.txt CEO SECTION 906 CERTIFICATION EXHIBIT 32.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report on Form 10-Q of SeaOspa, Inc. (the "Company") for the period ended June 30, 2009, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Yakov Terner, principal executive officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: August 11, 2009 By: /s/ Yakov Terner ------------------------------------- Name: Yakov Terner Title: President, Treasurer and Director EX-32.2 5 ex32-2.txt CFO SECTION 906 CERTIFICATION EXHIBIT 32.2 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report on Form 10-Q of SeaOspa, Inc. (the "Company") for the period ended June 30, 2009, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Yossi Benitah, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge and belief: (1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: August 11, 2009 By: /s/ Yossi Benitah ----------------------------------- Name: Yossi Benitah Title: Secretary and Director -----END PRIVACY-ENHANCED MESSAGE-----