US-China Biomedical Technology (UCBB) 10-Q 2013 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark one)
[x]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended May 31, 2012

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: 000-54440

CLOUD STAR CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	27-4479356
(State or Other Jurisdiction	(I.R.S. Employer
of Incorporation or Organization)	Identification No.)

P.O. Box 4906, Mission Viejo, CA	92618
(Address of principal executive offices)	(Zip Code)

(866) 250-2999
(Registrant’s telephone number, including area code)

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 check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ ] No [ ]Not Applicable

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filero Accelerated filero Non-accelerated filero Smaller reporting company [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yeso No [X]

As of July 16, 2012, the registrant’s outstanding common stock consisted of 97,200,000 shares, $0.001 par value.

Table of Contents

Cloud Star Corporation

Index to Form 10-Q

For the Quarterly Period Ended May 31, 2012

PART I	Financial Information	3
ITEM 1.	Unaudited Balance Sheets	3
	Unaudited Statements of Operations	4
	Unaudited Statement of Stockholders’ Deficit	5
	Unaudited Statements of Cash Flows	6
	Notes to the Unaudited Financial Statements	7
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	20
ITEM 4T.	Controls and Procedures	20
PART II	Other Information	23
ITEM 1.	Legal Proceedings	23
ITEM 1A.	Risk Factors	23
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
ITEM 3	Defaults Upon Senior Securities	23
ITEM 4	Submission of Matters to a Vote of Security Holders	23
ITEM 5	Other Information	23
ITEM 6	Exhibits	24
	SIGNATURES	25

2

PART I - FINANCIAL INFORMATION

Item I. Financial Statements.

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

BALANCE SHEETS 

(Unaudited)

	May 31, 2012	February  29, 2012
ASSETS
Current assets:
Cash	$         3,047	$      13,658
Accounts receivable	335	-
Total current assets	3,382	13,658
Deposits	940	-
Website and software costs, net	51,279	31,279
TOTAL ASSETS	$       55,601	$     44,937
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$       19,788	$              -
Accrued liabilities	2,638	100
Convertible notes payable	-	100,000
Total current liabilities	22,426	100,100
Long term liabilities:
Convertible notes payable, long-term	125,000	-
Total liabilities	147,426	100,100
Commitments and contingencies
Stockholders' deficit:
Common stock, $0.001 par value, 190,000,000 shares authorized;    100,000,000 and 60,000,000 shares issued and 97,200,000 and    60,000,000 outstanding at May 31, 2012 and February 29, 2012,    respectively	97,200	60,000
Additional paid-in capital	-	15,000
Deficit accumulated during the development stage	(189,025)	(130,163)
Total stockholders' deficit	(91,825)	(55,163)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$       55,601	$      44,937

See accompanying notes to unaudited financial statements.

3

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENTS OF OPERATIONS

(Unaudited) 

	For the Three Months Ended May 31, 2012	For the Period from October 17, 2011 ("Inception") to May 31, 2012
Revenue	$                       -	$                       -
General and administrative [a]	49,720	119,883
Loss from operations	(49,720)	(119,883)
Interest expense	288	388
Net loss	$               (50,008)	$             (120,271)
Weighted average shares basic and diluted	64,043,478
Weighted average basic and diluted loss    per common share	$                  (0.00)
[a] Includes stock-based compensation of $20,000 for each period

See accompanying notes to unaudited financial statements.

4

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENT OF STOCKHOLDERS’ DEFICIT

(Unaudited)

			Additional	Deficit Accumulated During the Development Stage	Total Stockholders' Deficit
	Common Stock		Paid-in
	Shares	Amount	Capital
Balance at October 17, 2011 (Inception)	-	$                      -	$                      -	$                              -	$                      -
Founders shares issued	60,000,000	60,000	-	(59,900)	100
Contributed services	-	-	15,000	-	15,000
Net loss	-	-	-	(70,263)	(70,263)
Balance at February 29, 2012	60,000,000	60,000	15,000	(130,163)	(55,163)
Net shares retained by stockholders
of Accend Media	37,000,000	37,000	(34,800)	(8,854)	(6,654)
Fully vested stock issued to Director
($0.10 per share)	200,000	200	19,800	-	20,000
Net loss	-	-	-	(50,008)	(50,008)
Balance at May 31, 2012	97,200,000	$               97,200	$                      -	$                   (189,025)	$             (91,825)

See accompanying notes to unaudited financial statements.

5

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Three Months Ended	For the Period from October 17, 2011 ("Inception") to
	May 31, 2012	May 31, 2012
Cash flows from operating activities:
Net loss	$                      (50,008)	$                    (120,271)
Adjustments to reconcile net loss to net cash    used in operating activities:
Contributed services	-	15,000
Stock compensation	20,000	20,000
Changes in operating assets and liabilities:
Accounts payable	12,799	12,799
Accrued liabilities	2,538	2,638
Net cash used in operating activities	(14,671)	(69,834)
Cash flows from investing activities:
Deposits	(940)	(940)
Website and software costs	(20,000)	(51,279)
Net cash used in investing activities	(20,940)	(52,219)
Cash flows from financing activities:
Proceeds from issuance of founders shares	-	100
Proceeds from convertible notes payable	25,000	125,000
Net cash provided by financing activities	25,000	125,100
Net change in cash	(10,611)	3,047
Cash, beginning of period	13,658	-
Cash, end of period	$                          3,047	$                          3,047
Supplemental disclosures of cash flow information
Cash paid during the period for:
Interest	$                                -	$                                -
Taxes	$                                -	$                                -

See accompanying notes to unaudited financial statements

6

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

 Note 1 - Organization and Business

Cloud Star Corporation (“Cloud Star” or the “Company”) was incorporated in the State of Nevada on October 17, 2011 (“Inception”) with operations in California. The Company’s Chief Executive Officer assigned its rights and interests in technology named “The VirtualKey Desktop Solution” (or “MyComputerKey”). The Company’s principal business has been the research and development (“R&D”) of the MyComputerKey. Cloud Star is currently developing the software infrastructure and interface with the internet.

The MyComputerKey provides a simple and secure platform for enterprise customers and government agencies of all sizes to access their desktop infrastructure through the internet often referred to as the cloud. Our product offers a person access to their desktop from any location, at any time, with no configuration requirements and no administration effort. A user inserts the MyComputerKey into a PC or Mac USB port to gain instant access directly to their desktop that is familiar and pre-configured to their business needs. The user’s own desktop image with a standardized operating system, business and productivity applications, and related security safeguards is available from any corporate or remote site.

On May 22, 2012, Cloud Star entered into anAcquisition Agreement and Plan of Merger agreement with Accend Media, (“Accend”). Accend has generated limited revenues from internet lead generation and marketing landing pages.

Merger

The merger was accounted for as a reverse acquisition in accordance with Accounting Standards Codification (“ASC”) 805Business Combinations. In connection with this agreement, Scott Gerardi and another shareholder of Accend transferred or canceled 118,000,000 of their 120,000,000 shares as follows: 60,000,000 shares to acquire Cloud Star; 2,800,000 shares returned to treasury; 200,000 shares transferred to a new director; 5,000,000 shares to be sold for contributed capital for the Company and 50,000,000 shares cancelled.  Immediately prior to the merger, Accend had 150,000,000 shares outstanding after giving effect for the five for one stock split approved by its board of directors on March 22, 2012. Immediately after the merger, 97,200,000 shares are outstanding with the sole shareholder of Cloud Star owning 60,000,000 shares. 

The acquisition of Cloud Star resulted in a change in reporting entity, whereby the financial statements of Cloud Star are reported at historical costs.  As a result, the accompanying statement of shareholders’ deficit reflects the legal capital structure and shares of Accend.  This assumes and reports the shares of Accend issued at the time Cloud Star shares were originally issued beginning on October 17, 2011.  Accordingly, the shares totaling 37,000,000 retained by the shareholders of Accend on May 22, 2012 are reflected as effectively issued in the accompanying statement of shareholders’ deficit and the related assumption of net liabilities $6,654.  The assets and liabilities of Accend were reported at fair value.  

7

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

The historical share data of Accend were retroactively adjusted to reflect the five-for-one forward stock split effected on May 7, 2012 in contemplation of the acquisition. The following is a schedule of Accend assets acquired and liabilities assumed at the date of acquisition:

Assets acquired:
Accounts receivable	$                   335
Liabilities assumed:
Accounts payable	6,989
Net liabilities assumed	$              (6,654)

The following unaudited pro forma information was prepared as if the merger had taken place at the beginning of the period for the three months ended May 31, 2012:

	Pro Forma Combined
	(Unaudited)
Net loss	$            (50,008)
Weighted average shares basic and diluted	97,200,000
Weighted average basic and diluted loss    per common share	$                (0.00)

Cloud Star did not have operations during the corresponding period in the preceding year.

8

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

Note 2 - Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited interim financial statements have been prepared by the Company pursuant to the rules and regulations of the United States Securities Exchange Commission. Certain information and disclosures normally included in the annual financial statements prepared in accordance with the accounting principles generally accepted in the Unites States of America have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these financial statements have been included. Such adjustments consist of normal recurring adjustments. These interim financial statements should beread in conjunction with the historical financial statements and related notes thereto of the Company filed with the Securities and Exchange Commission including our Annual Report on Form 10-K for the fiscal year ended February 29, 2012 and the Form 8-K filed on May 22, 2012. The results of operations for the three months ended May 31, 2012, are not necessarily indicative of the results that may be expected for the full year.

We are a development-stage company under ASC 915 -Development Stage Entities with no commercial revenues achieved to date.

Going Concern Considerations and Management’s Plans

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America, which contemplate continuation of the Company as a going concern. The Company has incurred net losses of $120,271 since Inception. The Company currently has limited liquidity, and no revenue generating activities. These factors raise substantial doubt about our ability to continue as a going concern. If the Company is unable to obtain adequate capital, it could be forced to cease operations.

We anticipate that the Company will be dependent, for the foreseeable future, on additional capital to fund further development of our infrastructure and to fund operations until such time we have sufficient revenues to meet our cost structure. We have received $125,000 in funding from inception to May 31, 2012. We will need additional capital as we launch our products in the marketplace. In light of our efforts, there are no assurances that the Company will be successful in obtaining sufficient capital to continue as a going concern.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. If unsuccessful, the Company may have to curtail operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

9

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

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 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.

Basic Loss per Common Share

Basic loss per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. As of May 31, 2011 the Company had 1,250,000 shares of potentially dilutive shares that have been excluded from the basic and diluted loss per share computations as they are anti-dilutive due to the loss.

New Accounting Pronouncements

The Financial Accounting Standards Board issues Accounting Standard Updates (“ASU”) to amend the authoritative literature in ASC. There have been a number of ASUs to date that amend the original text of ASC. The Company believes those issued to date either (i) provide supplemental guidance, (ii) are technical corrections, (iii) are not applicable to the Company or (iv) are not expected to have a significant impact on the Company.

Note 3 - Convertible Notes Payable

The Company received advances from, and had expenses paid on its behalf by, Leeward Ventures totaling $125,000 from Inception through May 31, 2012 to fund software and website development, and provide working capital. The notes accrued interest at 1% per annum and were convertible into shares of common stock at a rate of $0.10 per share prior to the close of the merger. The notes were originally due on or about August 9, 2012. The notes are being satisfied subsequent to May 31, 2012 through transfer of Cloud Star’s shares by an existing shareholder at $0.10 per share or 1,250,000 shares. At May 31, 2012, such notes are reflected as noncurrent due to the ultimate satisfaction through these share transfers pursuant to the acquisition and merger agreement.

Note 4 - Commitments and Contingencies

Operating Lease

On February 23, 2012, the Company entered into an operating lease for its corporate office for a period of six months for $800 per month.

10

CLOUD STAR CORPORATION

(FORMERLY ACCEND MEDIA)

(A DEVELOPMENT-STAGE COMPANY)

NOTES TO UNAUDITED FINANCIAL STATEMENTS

Note 5 - Stockholders’ Deficit

Authorizations and Designations

The Company is authorized to issue 190,000,000 shares of its $0.001 par value common stock and 10,000,000 shares of its $ 0.001 par value preferred stock. To date, no preferred stock is issued.

Common Stock

As of May 22, 2012, the existing shareholders of Accend retained 37,000,000 shares of its common stock in connection with the merger of Accend. At such date, net liabilities assumed were $6,654, which are reflected as a reduction of paid-in capital and the deficit accumulated during the development stage in the accompanying statement of stockholders’ deficit.

During the period from Inception to May 31, 2012, the Company issued 200,000 shares to a director for services rendered. The shares were fully vested on the date of issuance and stock compensation expense of $20,000 was recorded during the three months ended May 31, 2012. The compensation expense was determined based on the estimated fair value of the common stock which was deemed to be the conversion price of the convertible note payable.

Contributed Capital

During the period from Inception to May 31, 2012, services were provided by the Company’s Chief Executive Officer. During this period, the Chief Executive officer forgave his salary for two months during the commencement of operations, valued at $7,500 per month. Unpaid services are considered contributed service to the Company. The fair value of contributed services totaled $15,000 and has been recognized in the accompanying statement of stockholders’ deficit as contributed services, and the accompanying statement of operations as general and administrative expense.

Note 6 – Subsequent Event

Subsequent to May 31, 2012, Leeward Ventures paid approximately $30,000 in expenses on behalf of the Company for operating expenses. Such advances carry the same terms and conditions as convertible notes payable outlined in Note 3.

11

Item 2. - Management's Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Information

The Company from time to time may make written or oral "forward-looking statements" including statements contained in this report and in other communications by the Company, which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation

Reform Act of 1995.

These forward-looking statements include statements of the Company's plans, objectives, expectations, estimates and intentions, which are subject to change based on various important factors (some of which are beyond the Company's control). The following factors, in addition to others not listed, could cause the Company's actual results to differ materially from those expressed in forward looking statements: the strength of the domestic and local economies in which the Company conducts operations, the impact of current uncertainties in global economic conditions and the ongoing financial crisis affecting the domestic and foreign banking system and financial markets, including the impact on the Company's suppliers and customers, changes in client needs and consumer spending habits, the impact of competition and technological change on the Company, the Company's ability to manage its growth effectively, including its ability to successfully integrate any business which it might acquire, and currency fluctuations. All forward-looking statements in this report are based upon information available to the Company on the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except

as required by law.

Critical Accounting Policies

There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations", included in our Annual report on Form 10-K for the fiscal year ended February 29, 2012.

Results of Operations

Overview of Current Operations

Cloud Star Corporation, was organized December 20, 2010 under the laws of the State of Nevada, as Accend Media. On or about May 22, 2012, Accend Media, and Cloud Star Corporation, a privately-held Nevada corporation headquartered in California, entered into an Acquisition Agreement and Plan of Merger.

Our Business

Cloud Star is an information technology services and software company that delivers immediate, easy and secure access to computer desktops and other consumer electron devices from remote locations.

Overview

Cloud Star's flagship product, MyComputerKey^TM is a proprietary, patent-pending technology that provides a secure multi-factor validation and authentication system for cloud-based infrastructures and protects data accessed from remote locations worldwide. The product is a custom-designed USB keycard programmed to connect via the Internet to users' desktop or server seamlessly, which provides the user immediate access to files, personalized environments, data, programs and applications. Said differently, MyComputerKey^TM allows a user to access his or her base computer from different locations utilizing the internet cloud through a separate computer (the “remote computer”). Working models were manufactured and a successful beta test was completed with the employees from three corporations.

Key Advantages MyComputerKey^TM

·User always accesses their same,consistent and familiar desktopwhere all of their customized andpersonal applications and files reside

·No need for software installation on the remote computerand customization—just plug-inMyComputerKey^TM

·Enhances compliance, and auditcapabilities, of Risk Management and Legal

·User desktop images can be backedup on hosting servers and restoredin case of a disaster and existingcorporate virus software providescontinuous scans, monitoring, andvirus protection against malwareand virus attacks

There is an encryption between the host and remote computer as well as a paring feature between the connecting devices.

All information is stored on basis of expiration therefore avoiding an unauthorized access or codes between the connecting computers.

MyComputerKey also includes our own connection software that provides the actual connection between the user’s desktop and the host computer the user is using to connect. This software is fully supportive in all Microsoft ™ based computers with quick installation and full security and protection for the computer.

Cloud Star’s Goals and Objectives

Cloud Star's goal is to become a provider of customizable, secure,multi-factor validation and authentication systems.

To do so, it will aggressively pursue the followingobjectives:

·Initiate a direct marketing campaign

·Establish strategic alliances with key channel partners

·Establish a recognizedposition in the market

·Protect and expand its intellectual property

·Introduce new products and product upgrades

The discussion that follows, conveys these objectives.

For business users, a second version of the key hasbeen designed that allows the user's information technology (“IT”) departmentto set the security parameters appropriate to thedatabase to be protected. The modifications consistof creating a user friendly "dashboard" to make iteasier for the customer to set up the system and createcustomized features and tokens—as well as de-activatekeys in the event they are lost or stolen. This business-to-business sectoris more competitive. In order to competitively differentiate itself, Cloud Star plans to developstrategic partnerships tobuild its market share of the lesscompetitive retail market. Management expects that users will find thefollowing characteristics very appealing:

·Cloud Star’s USB keycard is 100% independent and self-contained—no software downloads,configurations, or synchronizations are required on the remote computer.

·Various user-specific authentication, memory, orpre-set protocol access codes can be programmedinto this solid-state hardware.

·This technology is user-specific, allowsinformation flow tracking, and can be used toaccess any pre-determined database, application, fileor user-selected desktop that is cloud based.

·This technology works universally on both Appleand PC systems. In addition, once the respectiveuser has finished with the cloud access, there is no trace on the remote computer that the base computer has used. This is particularly important when using public computers while travelling.

Cloud Star’s Sales Strategy

While virtual USBs have been on the market for severalyears, to date, management is not aware of any company whohas targeted the mass consumer. Rather, providershave focused on IT professionals, most likely due tothe perceived complexity of virtualization and securityissues. Cloud Star instead has simplified the processand through an integrated marketing approach,advertises this simplicity to general consumers for avariety of applications. The sales strategy is to offer a product that is easy to use and utilizes plug and play technology.Cloud Star wants toimplement this very simplesales strategy.Cloud Star plans to market and sell their product through several partnerson a distribution level relationship.

Through a combination ofonline marketing, radio and television, consumers aredriven to the website where they can complete a 100%automated purchase.Cloud Star plans to provide support though phonesales and telephone call-in technical support. MyComputerKey is a high margin product soCloud Star is ableto outsource its fulfillment and customer support whilestill driving a high margin on all sales. This will allowCloud Star to focus on product development and developing marketing strategies with its channel partners.

Cloud Star plans to market a version II keywith enhanced security to businesses, government and educational entities that (i) have a mobile workforce (ii)currently utilize the cloud to increase the effectivenessand reduce costs associated with providing informationtechnology to its employees, customers and suppliersand (iii) entities that are considering doing so but havebeen reluctant to do so because of security concerns.The market potential forCloud Star's products encompasses several market segments, includinghealthcare facilities, government, media and telecom,manufacturing, educational facilities, consulting, legaland accounting and aerospace and defense. The Company successfully completed its Betatests with three such companies and is currently implementing thisenterprise model.

Cloud Star’s Market Strategy

Cloud Star's strategy is based on three targetmarkets: (i) Direct-to-Consumer; (ii) Retail; and (iii)Business-to-Business (B2B)—including enterprise andthe small and medium-size business market (SMB). Theproduct is the same for each market segment.

Direct-to-Consumer (DTC)

Management believes the internet is thecornerstone toCloud Star’s marketing effort. Management estimates at least 50%of Cloud Star’s sales will come from the internet and believes $0.50of every dollar spent on marketing will drive consumersonline to compare, research, sample and buy.

The internetstrategy will focus on driving traffic (consumers) to offer pages by means of a seriesof internet marketing platforms including banners,sponsored links, social bookmarking, blogs, surveys etc. Additionally, Cloud Star willfocus on affiliate marketing roll out with thegoal of the aforementioned internet marketing strategyto ultimately create an affiliatenetwork.

Television

Management believes that it is not one tool or media platform that is the answer, but the right mixof media and relevant content delivered real-time.After management has all its infrastructure tested andproven, Cloud Star plans to test direct-responsetelevision with 30, 60 and 120 second spots,as well as a possible 30-minute long form infomercial nationally.

There are many companies that focus on TV as a medium andprovide an array of services besides production.Some generally participate via revenue share, thus reducingany upfront costs to the advertiser. The key is toresearch those firms that have experience with similar products, know what sells and when to sell it. In otherwords, firms that have a good handle on the marketing mix, specifically the target market, how to reach them,and pricing.

Retail

Cloud Star plans to offer MyComputerKey through retailstores by selling a secure access and data protectionservice. This will involve the same product (a key anda disk to program the key and the computer) where theuser could program his or her computer and the keyand then have secure access to his computer from anyother computer in the world. This would also protectthe user from unauthorized access by other who might have access to his computer in his absence. This willrequireCloud Star to set up a cloud service to authenticate the keys.

Traditional Retail – Point of Purchase

Cloud Star is already in talks with 3 nationalretailers and is considering an early launch versuswaiting until the product reaches greater marketpenetration.Cloud Starhas already begun to develop retail demand through all of its marketing and advertisingefforts which will be leveraged by management togain lower cost retail entry, excellent placement andshelf space.Cloud Star plans to hire a retail team that will workclosely with all retail buyers, retail marketing directorsand store managers to educate their employees and customers about the benefits of MyComputerKey.

Point-of- Purchase (“POP”) is not just displays, but a wider variety of printedmaterial that communicates the products messageat the point of purchase. Besides floor stands, wingracks, and counter unit displays, there are shelf talkers,product hang tags, shelf signage, ceiling signage,inflatable signage, in-store blimps, video end-caps, check out signage, window banners, in-store flyers, table tents and informational pamphlets, all vying for the attention of the time starved consumer who viewsclose to 1,000 items per minute during their 24 minuteshopping trip.

Cloud Star plans to employ a "PUSH" – "PULL"promotional & advertising strategy when buildingbrand awareness, generating trial/sampling purchasesand gaining distribution of MyComputerKey.Cloud Starthree stage "go-to-market" approach will first educatethe consumer about the product through a direct response advertising and marketing initiatives, thenmake the product readily available with directdistribution and finally implement programs tomotivate consumers to buy MyComputerKey.

"PUSH", or "getting the product on the shelf", provides the programs necessary to gain distribution andsecure product placement on limited retailer shelves. Itconsists of customer marketing funds (CMF) designedto support the customer's best promotional and consumption building vehicles as well as employeeincentive and training programs while providingmaterials that clearly communicate MyComputerKey'sunique selling points. These materials consist of avariety of "communication messages", including thoselisted above as well as shelf signs, neck hangers,window banners, floor displays with header cards,table tents and possibly logo apparel.

"PULL", or getting the product "off the shelf" and intothe hands of consumers, answers the biggestquestion posed by on-premise and off-premise buyers;"What are you doing to drive consumers into my storeto purchase your product?" Pull programs are designed to entice the customer and educate the consumerwhile motivating them to sell or purchase our product.Various Pull programs include advertising directedtowards the consumer (print, radio, TV, internet, directmail, etc), instant redeemable or mail-in coupons,mail-in money back rebates, retailer loyalty programs,co-branding with complementary products and wetsampling events.

The key strategy for MyComputerKey'sgrowth is to understand consumer and channel member needs in orderto satisfy them. In addition, focus communicationswithin channels that meet primary target consumersand increase brand image, superior quality andperformance attributes and leverage the brand forstrategic product initiatives. Again,Cloud Star plans to use theabove advertising and promotional strategies to driveawareness, trials and new usage.

Business to Business (B2B)

The business to business marketconsists of large businesses, educational or governmententities. These entities utilize private, public orhybrid clouds and will have an infrastructure in place,complete with firewalls and other security systems.They also have an IT organization to operateand maintain the company's computer systems,networks and data on behalf of the company. The ITorganization generally will be headed by a CIO or IT Director.Although the CIO's recommendations will generallybe reviewed and approved by the CEO, the CIO orIT Director will be the primary decision maker withrespect to IT matters.

Management believes that in the enterprise market, CIOs are looking for solutions,not technology. They typically have a staff of IT experts toevaluate technology. Selling in the enterprise marketrequires enough industry and company expertise to understand specific problems for which a CIO isseeking solutions. For these reasons, a successfulmarket entry strategy in the enterprise market needsto be focused on selected vertical market segments,primarily in the professional service and medicalpractice sectors.

Small and medium size businesses may use the cloud for limited purposes, such as Gmail or Office 365, butmay not yet maintain their data and other programs in the cloud. These companies may want to takeadvantage of the opportunities offered by the cloud,but may not yet have the infrastructure to do so. Theymay also have security concerns about using theCloud, particularly with a mobile workforce. Attractiveinitial markets will include financial, legal, medical and educational institutions.

Pricing

Initial pricing for the basic key is $ 49.99, whichincludes the USB unit and the first year's subscriptionto the hosting service. In conjunction with the productlaunch, theCloud Star plans to experiment with differentoffers, such as:

· Simultaneous purchase of 2nd unit and subscriptionat 50% off

·Bundled annual subscriptions, for example:One year = $ 49.99

Two year = $ 69.99

Three year = $ 79.99

· Free 30-day trial with automatic billing on the 31st day unless cancelled

RESULTS OF OPERATIONS

For the three month period ending May 31, 2012, and for the period from October 17, 2011 (inception) to May 31, 2012 the Company recognized no revenues. The Company focused its activities during the three month period ended May 31, 2012 on the merger between Accend Media and Cloud Star Corp., the development of a software andencryption technology for itsflagship product, MyComputerKey^TMand building its corporate infrastructure. Management believes that revenues will commence in the three month period ended November 30, 2012.

The Company incurred total operating expenses of $49,720 and $119,833 during the three month period ending May 31, 2012 and the period from Inception to May 31, 2012, respectively. The operating expenses consisted of general and administrative fees of $49,720. The major components of general and administrative expenses during the three month period ended May 31, 2012 included $20,000 in stock-based compensation, $2,078 in rent and $22,500 in payroll costs.

The Company used net cash in operations of $14,671 during the three months ended May 31, 2012. The Company used cash in investing activities for the development of software of $20,940 during the same period which was provided by cash of $25,000 from financing activities from Leeward Ventures, an entity controlled by a director of the Company.

Management’s Plan of Operation

Management does not believe that the Company will be able to generate any significant profit during the coming year. Management believes that general and administrative costs, as well as building its infrastructure will most likely curtail any significant profits.

Notwithstanding, the Company anticipates it will continue to generate losses and therefore it may be unable to continue operations in the future. Management anticipates it will need to raise $25,000 to implement its business plan. As a result, Cloud Star will have to issue debt or equity or enter into a strategic arrangement with a third party to meet its funding requirements. There can be no assurance that additional capital will be available to Cloud Star, especially with the current economic environment.

Management believes it has sufficient cash reserves to keep the Company operational through the second quarter of 2012. Management will need to obtain outside funding to keep the Company operational beyond the second quarter. There are no assurances that management will be able to secure outside funding. Management anticipates that the Company will need to spend a minimum of $15,000 over the next twelve months to pay for audit and legal fees to keep the company fully reporting. Failure to secure additional funding can result in the company being fully reporting, nonoperational or both non-operational and fully reporting. The Company will require additional funds to build its business infrastructure. In order to fulfill its capital requirements and execute on its business plan, the Company will be required to raise additional funds through the issuance of debt or equity securities. There are no assurances additional capital will be available or if available, on acceptable terms.

Summary of any product research and development that we will perform for the term of our plan of operation.

We do not anticipate performing any additional significant product research and development under our current plan of operation.

Expected purchase or sale of plant and significant equipment

We do not anticipate the purchase or sale of any plant or significant equipment; as such items are not required by us at this time.

Significant changes in the number of employees

As of May 31, 2012, we had one employee, our Chief Executive Officer. We are dependent upon officers and directors for our future business development. As our operations expand we anticipate the need to hire additional employees, consultants and professionals; however, the exact number is not quantifiable at this time.

Liquidity and Capital Resources

The Company has limited financial resources available, which has had an adverse impact on the Company's liquidity, activities and operations. These limitations have adversely affected the Company's ability to obtain certain projects and pursue additional business. Without realization of additional capital, it would be unlikely for the Company to continue as a going concern. In order for the Company to remain a Going Concern it will need to find additional capital. Additional working capital may be sought through additional debt or equity private placements, additional notes payable to banks or related parties (officers, directors or stockholders), or from other available funding sources at market rates of interest, or a combination of these. The ability to raise necessary financing will depend on many factors, including the nature and prospects of any business to be acquired and the economic and market conditions prevailing at the time financing is sought. No assurances can be given that any necessary financing can be obtained on terms favorable to the Company, or at all.

As of May 31, 2012, our current assets were $3,382 and our current liabilities were $22,426. As of May 31, 2012, our total assets were $55,601 compared to total assets of $44,937 as of February 29, 2012. Total assets as of May 31, 2012 consisted of $3,047 in cash, $335 in accounts receivable, $940 in deposits and $51,279 in website and internal use software costs incurred with the development of MyComputerKey. As of May 31, 2012, our total liabilities were $147,426 compared to current and total liabilities of $100,100 as of February 29, 2012. Our liabilities consisted of $19,788 in accounts payable, $2,638 in accrued liabilities, and $125,000 in convertible notes payable. The convertible notes payable are being satisfied through stock transferred from an existing stockholder at $0.10 per share subsequent to May 31, 212. Accordingly, such amount has been reflected as non-current.

We have not generated positive cash flows from operating activities. For the three months ended May 31, 2012, net cash flow used in operating activities was $14,671, our net cash flow used in investing activities was $20,940, and our net cash flows provided by financing activities was $25,000.

Going Concern

Our ability to continue as a going concern is contingent upon the successful completion of additional financing arrangements and our ability to achieve and maintain profitable operations.

Therefore, management plans to raise equity capital to finance the operating and capital requirements of the Company. While the Company is devoting its best efforts to achieve the above plans, there is no assurance that any such activity will generate funds that will be available for operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern.

Off-Balance Sheet Arrangements

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

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not applicable.

Item 4T. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures, as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in rules and forms adopted by the SEC, and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, to allow timely decisions regarding required disclosures.

Management, with the participation of the Chief Executive Officer and the Chief Financial Officer, who is also the sole member of our Board of Directors, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on such evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that, our disclosure controls and procedures were not effective. Our disclosure controls and procedures were not effective because of the "material weaknesses" described below under "Management's report on internal control over financial reporting," which are in the process of being remediated as described below under "Management Plan to Remediate Material Weaknesses."

Management's Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting, as defined in rules promulgated under the Exchange Act, is a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer and affected by our Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Internal control over financial reporting includes those policies and procedures that:

• pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

• provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and our Board of Directors; and

• provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements

Because of its inherent limitations, a system of internal control over financial reporting can provide only reasonable, not absolute, assurance that the objectives of the control system are met and may not prevent or detect misstatements. Internal control over financial reporting is a process that involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper override. Because of such limitations, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, these inherent limitations are known features of the financial reporting process, and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Further, over time control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of May 31, 2012. In making its assessment, management used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on its assessment, management has concluded that we had certain control deficiencies described below that constituted material weaknesses in our internal controls over financial reporting. As a result, our internal control over financial reporting was not effective as of May 31, 2012.

A "material weakness" is defined under SEC rules as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company's annual or interim financial statements will not be prevented or detected on a timely basis by the company's internal controls. As a result of management's review of the investigation issues and results, and other internal reviews and evaluations that were completed after the end of quarter related to the preparation of management's report on internal controls over financial reporting required for this quarterly report on Form 10-Q, management concluded that we had material weaknesses in our control environment and financial reporting process consisting of the following:

1)lack of a functioning audit committee due to a lack of a majority of independent members and a lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures;

2)  insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements;

We do not believe the material weaknesses described above caused any meaningful or significant misreporting of our financial condition and results of operations for the quarter ended May 31, 2012. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

Management Plan to Remediate Material Weaknesses

Management believes that the material weaknesses set forth in item (2) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods. In an effort to remediate the identified material weaknesses and other deficiencies and enhance our internal controls, we have initiated, or plan to initiate, the following series of measures:

We plan to appoint one or more outside directors to our board of directors who shall be appointed to an audit committee resulting in a fully functioning audit committee who will undertake the oversight in the establishment and monitoring of required internal controls and procedures such as reviewing and approving estimates and assumptions made by management when funds are available to us.

We believe the remediation measures described above will remediate the material weaknesses we have identified and strengthen our internal control over financial reporting. We are committed to continuing to improve our internal control processes and will continue to diligently and vigorously review our financial reporting controls and procedures. As we continue to evaluate and work to improve our internal control over financial reporting, we may determine to take additional measures to address control deficiencies or determine to modify, or in appropriate circumstances not to complete, certain of the remediation measures described above.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

This quarterly report does not include an attestation report of the Corporation's registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by the Corporation's registered public accounting firm pursuant to temporary rules of the SEC that permit the Corporation to provide only the management's report in this quarterly report.

PART II. OTHER INFORMATION

Item 1 - Legal Proceedings

From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business.

We are not presently a party to any material litigation, nor to the knowledge of management is any litigation threatened against us, which may materially affect us.

Item 1A - Risk Factors

See Risk Factors set forth in Part I, Item 1A of the Company's Annual Report on Form 10-K for the fiscal year ended February 29, 2012 and the discussion in Item 1, above, under "Liquidity and Capital Resources."

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

Cloud Star Corporation common stock is currently listed on the OTC-BB. Following the merger with Accend Media, on May 24, 2012, the Company changed its trading symbol from ACNM to CLDS.

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Item 6 - Exhibits

Exhibit Number	Ref	Description of Document
31.1		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002.
101	*	The following materials from this Quarterly Report on Form 10-Q for the quarter ended May 31, 2012, formatted in XBRL (eXtensible Business Reporting Language):
		(1)Balance Sheets at May 31, 2012 (unaudited), and February 29, 2012 (audited)
		(2)Unaudited Statements of Operations for the three-month periods ended May 31, 2012, and the period from October 17, 2011 (Inception) to May 31, 2012
		(3)Unaudited Statements of Stockholders’Deficit from October 17, 2011 (Inception) to May 31, 2012
		(4)Unaudited Statements of Cash Flows for the three-month periods ended May 31, 2012, and the period from October 17, 2011 (Inception) to May 31, 2012
		(5)    Notes to the financial statements statements.

* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

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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.

Date: July 16, 2012

Cloud Star Corporation

By: /s/ Safa Movassaghi

Safa Movassaghi
Director and CEO (principal executive, financial and accounting officer)

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