FORM 10-Q

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2009

¨ 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 000-52087

Scout Acquisition, Inc.

(Exact name of registrant as specified in its charter)

Delaware		26-0133324
(State or other jurisdiction		(I.R.S. Employer Identification Number)
of incorporation or organization)

c/o Sands Brothers Venture Capital LLC, 90 Park Avenue, 31st Floor, New York, NY 10016

(Address of principal executive offices)

(212) 953-4983

(Registrant’s telephone number, including area code)

No change

(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 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 ¨

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

Large accelerated filer ¨	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 ¨.

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING

THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨ No ¨.

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 1,500,000 shares of common stock, par value $.0001 per share, outstanding as of May 13, 2009.

SCOUT ACQUISITION, INC.

- INDEX -

		Page
PART I – FINANCIAL INFORMATION:

Item 1.	Financial Statements:

	Balance Sheets as of March 31, 2009 (Unaudited) and December 31, 2008	1

	Statements of Operations (Unaudited) for the Three Months Ended March 31, 2009 and 2008 and for the Cumulative Period from January 3, 2006 (Inception) to March 31, 2009	2

	Statement of Stockholders’ Deficiency for the Period from January 3, 2006 (Inception) to March 31, 2009 (Unaudited)	3

	Statements of Cash Flows (Unaudited) for the Three Months Ended March 31, 2009 and 2008 and for the Cumulative Period from January 3, 2006 (Inception) to March 31, 2009	4

	Notes to Unaudited Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	10

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	13

Item 4T.	Controls and Procedures	13

PART II – OTHER INFORMATION:

Item 1.	Legal Proceedings	13

Item 1A.	Risk Factors	13

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	13

Item 3.	Defaults Upon Senior Securities	13

Item 4.	Submission of Matters to a Vote of Security Holders	13

Item 5.	Other Information	14

Item 6.	Exhibits	14

Signatures		15

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

SCOUT ACQUISITION, INC.

A Development Stage Company

BALANCE SHEETS

	March 31, 2009 (Unaudited)			December 31, 2008

ASSETS

CURRENT ASSETS:
Cash	$	41,328		$	1,688
Prepaid expenses		1,875			3,750

TOTAL CURRENT ASSETS	$	43,203		$	5,438

LIABILITIES AND STOCKHOLDERS’ DEFICIENCY

CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	11,574		$	3,861
Loans payable to stockholders		35,000			-
Accrued interest payable to stockholders		3,030			-

TOTAL CURRENT LIABILITIES		49,604			3,861

LONG TERM LIABILITIES:
Loans payable to stockholders		93,750			88,750
Accrued interest payable to stockholders		8,418			9,780
		102,168			98,530

TOTAL LIABILITIES		151,772			102,391

STOCKHOLDERS’ DEFICIENCY:
Preferred stock, $.0001 par value; 10,000,000 shares authorized; none issued and outstanding		-			-
Common stock, $.0001 par value; 75,000,000 shares authorized; 1,500,000 shares issued and outstanding		150			150
Additional paid-in capital		24,850			24,850
Deficit accumulated during the development stage		(133,569	)		(121,953	)

TOTAL STOCKHOLDERS’ DEFICIENCY		(108,569	)		(96,953	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIENCY	$	43,203		$	5,438

See accompanying notes to unaudited financial statements.

SCOUTACQUISITION, INC.

A Development Stage Company

STATEMENTS OF OPERATIONS

(Unaudited)

	For the Three Months Ended March 31,						For the Cumulative Period from January 3, 2006 (Inception) to March 31,
	2009			2008			2009
REVENUE	$			$	-		$

General and administrative expenses		9,948			10,809			122,121

LOSS BEFORE OTHER EXPENSES		(9,948	)		(10,809	)		(122,121	)

OTHER EXPENSES:
Interest expense		1,668			1,052			11,448

NET (LOSS)	$	(11,616	)	$	(11,861	)	$	(133,569	)

BASIC AND DILUTED NET LOSS PER SHARE	$	(.01	)	$	(.01	)

NUMBER OF SHARES USED IN COMPUTING BASIC AND DILUTED NET LOSS PER SHARE		1,500,000			1,500,000

See accompanying notes to unaudited financial statements.

SCOUT ACQUISITION, INC.

A Development Stage Company

STATEMENT OF STOCKHOLDERS’ DEFICIENCY

											(Deficit)
											Accumulated
									Additional		During the
	Preferred Stock				Common Stock				Paid-in		Development			Stockholders’
	Shares		Amount		Shares		Amount		Capital		Stage			Deficiency
BALANCE, JANUARY 3, 2006		-	$	-		-	$	-	$	-	$	-		$	-
Issuance of common stock		-		-		1,500,000		150		24,850		-			25,000
Net (loss)		-		-		-		-		-		(39,354	)		(39,354	)
BALANCE, DECEMBER 31, 2006		-		-		1,500,000		150		24,850		(39,354	)		(14,354	)
Net (loss)		-		-		-		-		-		(41,276	)		(41,276	)
BALANCE, DECEMBER 31, 2007		-		-		1,500,000		150		24,850		(80,630	)		(55,630	)
Net (loss)		-		-		-		-		-		(41,323	)		(41,323	)
BALANCE, DECEMBER 31, 2008		-		-		1,500,000		150		24,850		(121,953	)		(96,953	)
Net (loss)		-		-		-		-		-		(11,616	)		(11,616	)
BALANCE, MARCH 31, 2009 (UNAUDITED)		-		-		1,500,000	$	150	$	24,850	$	(133,569	)	$	(108,569	)

See accompanying notes to unaudited financial statements.

SCOUT ACQUISITION, INC.

A Development Stage Company

STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Three Months Ended March 31,						For the Cumulative Period from January 3, 2006 (Inception) to March 31,
	2009			2008			2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)	$	(11,616	)	$	(11,861	)	$	(133,569	)
Adjustments to reconcile net (loss) to net cash used in operating activities:
Changes in operating assets and liabilities:
Decrease (increase) in prepaid expenses		1,875			625			(1,875	)
Increase in accrued interest payable to stockholders		1,668			908			11,448
Increase in accounts payable and accrued expenses		7,713			3,644			11,574
Net cash used in operating activities		(360	)		(6,684	)		(112,422	)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of common stock		-			-			25,000
Proceeds from stockholder loans		40,000			35,000			128,750
Net cash provided by financing activities		40,000			35,000			153,750

NET INCREASE IN CASH		39,640			28,316			41,328

Cash, beginning of period		1,688			6,454			-

CASH, END OF PERIOD	$	41,328		$	34,770		$	41,328

See accompanying notes to unaudited financial statements.

SCOUT ACQUISITION, INC.

A Development Stage Company

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2009

NOTE 1 -

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

(a)

Organization and Business:

Scout Acquisition, Inc. (the Company) was incorporated in the state of Delaware on January 3, 2006 for the purpose of raising capital that is intended to be used in connection with its business plans which may include a possible merger, acquisition or other business combination with an operating business.

The Company is currently in the development stage. All activities of the Company to date relate to its organization, initial funding and share issuances.

(b)

Basis of Presentation:

The accompanying financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the recoverability of assets and the satisfaction of liabilities in the normal course of business. The Company has had no revenue and has incurred accumulated net losses from January 3, 2006 (inception) through March 31, 2009 of $133,569. In addition, the Company’s development activities since inception have been financially sustained through stockholder loans. The ability of the company to continue as a going concern is dependent upon its ability to find a suitable acquisition/merger candidate, raise additional capital from the sale of common stock, receive additional loans from its shareholders and, ultimately, the achievement of significant operating revenues. The accompanying financial statements do not include any adjustments that might be required should the Company be unable to recover the value of its assets or satisfy its liabilities. Management plans to issue more shares of common stock in order to raise money and to continue to borrow from the Company’s existing stockholders until a business combination is effective.

(c)

Use of Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(d)

Cash Equivalents:

For purposes of the statement of cash flows, the Company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents. There are no cash equivalents at the balance sheet date.

SCOUT ACQUISITION, INC.

A Development Stage Company

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2009

NOTE 1 -

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(Continued):

(e)

Income Taxes:

As required by FASB interpretation No. 48, “Accounting for Uncertainty in Income Taxes—An Interpretation of FASB Statement No. 109” (“FIN 48”), the Company recognizes the financial statement benefit of an uncertain tax position only after considering the probability that a tax authority would sustain the position in an examination. For tax positions meeting a "more-likely-than-not" threshold, the amount recognized in the financial statements is the benefit expected to be realized upon settlement with the tax authority. For tax positions not meeting the threshold, no financial statement benefit is recognized. The Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax expense. As of March 31, 2009, the Company is unaware of any uncertain tax positions.

The Company utilizes the liability method of accounting for income taxes. Under the liability method deferred tax assets and liabilities are determined based on the differences between financial reporting basis and the tax basis of the assets and liabilities and are measured using enacted tax rates and laws that will be in effect, when the differences are expected to reverse. An allowance against deferred tax assets is recognized, when it is more likely than not, that such tax benefits will not be realized.

(f)

Loss per Common Share:

Basic loss per share is calculated using the weighted-average number of common shares outstanding during each reporting period. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each reporting period. The Company does not have any potentially dilutive instruments.

(g)

Fair Value of Financial Instruments:

The carrying value of current assets and liabilities approximates fair value due to the short period of time to maturity. The stockholder loans approximate fair value based on market rates available to the Company for financing with similar terms.

(h)

Business Combinations:

Effective January 1, 2009, the Company adopted SFAS No. 141(R) and 160 and FSP 141(R)-1 without any effect.

Statement of Financial Accounting Standards No. 141(R), “Business Combinations” (“SFAS 141R”), which replaced SFAS No. 141, “Business Combinations”, establishes principles and requirements for determining how an enterprise recognizes and measures the fair value of certain assets and liabilities acquired in a business combination, including noncontrolling interests, contingent consideration and certain acquired contingencies. SFAS 141(R) also requires acquisition-related transaction expenses and restructuring costs be expensed as incurred rather than capitalized as a component of the business combination.

SCOUT ACQUISITION, INC.

A Development Stage Company

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2009

NOTE 1 -

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(Continued):

(h) Business Combinations (continued):

Financial Staff Position (“FSP”) 141(R)-1, “Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies”, amended and clarified SFAS 141R to address application issues associated with initial recognition and measurement, subsequent measurement and accounting, and disclosure of assets and liabilities arising from contingencies in a business combination.

Statement of Financial Accounting Standards No. No. 160, “Noncontrolling Interests in Consolidated Financial Statements – An Amendment of ARB No. 51” (“SFAS 160”), establishes accounting and reporting standards for the noncontrolling interest in a subsidiary (previously referred to as minority interests). SFAS 160 also requires that a retained noncontrolling interest upon the deconsolidation of a subsidiary be initially measured at its fair value. SFAS 160 also requires reporting any noncontrolling interests as a separate component of stockholders’ equity and presenting any net income allocable to noncontrolling interests and net income attributable to stockholders of the Company separately in its consolidated statements of income.

NOTE 2 -

LOANS PAYABLE TO STOCKHOLDERS:

On January 3, 2006 and July 1, 2006, the Company entered into loan agreements with certain of its stockholders in the aggregate amount of $12,500 and $6,250, respectively. These loans accrue interest at 4.00%. These loans and all accrued interest shall be repaid in full upon the completion of a merger, and if not, the loans, including all accrued interest, will mature on December 31, 2010.

On February 22, 2007, the Company entered into loan agreements with certain of its stockholders in the aggregate amount of $35,000. These loans accrue interest at 8.25%. These loans and all accrued interest were to be repaid in full upon the completion of a merger, and if not, the loans, including all accrued interest, were to mature on February 22, 2009. On March 27, 2009, the Company entered into an Amended and Restated Promissory Note for each of these loan agreements, extending the maturity dates to December 31, 2010.

On March 13, 2008, the Company entered into loan agreements with certain of its stockholders in the aggregate amount of $35,000. These loans accrue interest at 8.25%. These loans and all accrued interest shall be repaid in full upon the completion of a merger, and if not, the loans, including all accrued interest, will mature on March 13, 2010. At March 31, 2009, these loans and related accrued interest of $3,030 are included in current liabilities.

On March 27, 2009, the Company entered into loan agreements with certain of its stockholders in the aggregate amount of $40,000. These loans accrue interest at 8.25%. These loans and all accrued interest shall be repaid in full upon the completion of a merger, and if not, the loans, including all accrued interest, will mature on March 27, 2011.

SCOUT ACQUISITION, INC.

A Development Stage Company

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2009

NOTE 3 -

CAPITAL STOCK:

The total number of shares of capital stock which the Company shall have authority to issue is eighty five million (85,000,000). These shares shall be divided into two classes with 75,000,000 shares designated as common stock at $.0001 par value (the “Common Stock”) and 10,000,000 shares designated as preferred stock at $.0001 par value (the “Preferred Stock”).

The Preferred Stock of the Company shall be issued by the Board of Directors of the Company in one or more classes or one or more series within any class and such classes or series shall have such voting powers, full or limited, or no voting powers, and such designations, preferences, limitations or restrictions as the Board of Directors of the Company may determine, from time to time.

Holders of shares of Common Stock shall be entitled to cast one vote for each share held at all stockholders' meetings for all purposes, including the election of directors. The Common Stock does not have cumulative voting rights.

NOTE 4 -

INCOME TAXES:

As of March 31, 2009, the Company has net operating loss carryforwards of approximately $134,000 to reduce future federal and state taxable income through 2029.

The provision for (benefit from) income taxes consists of the following for the period January 3, 2006 (inception) to March 31, 2009.

	For the Three Months Ended March 31, 2009			For the Three Months Ended March 31, 2008			For the Cumulative Period from January 3, 2006 (Inception) to March 31, 2009
Current:
Federal	$	-		$	-		$	-
Deferred:
Federal		(4,300	)		(4,100	)		(35,300	)
Valuation allowance		4,300			4,100			35,300
	$	-		$	-		$	-

The difference between the tax provision at the statutory federal income tax rate and the tax provision attributable to loss before income taxes is as follows:

	For the Three Months Ended March 31, 2009			For the Three Months Ended March 31, 2008			For the Cumulative Period from January 3, 2006 (Inception) to March 31, 2009
Statutory federal income tax rate		(34	)%		(34	)%		(34	)%
Surtax exemption		(3	)%		(0	)%		8	%
Valuation allowance		37	%		34	%		26	%
Income tax rate		0	%		0	%		0	%

SCOUT ACQUISITION, INC.

A Development Stage Company

NOTES TO UNAUDITED FINANCIAL STATEMENTS

March 31, 2009

NOTE 5 -

RECENT ACCOUNTING PRONOUNCEMENTS:

In April 2009, the FASB issued FSP No. FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments. This FSP amends FASB Statement No. 107, Disclosures about Fair Value of Financial Instruments, to require disclosures about fair value of financial instruments for interim reporting periods of publicly traded companies as well as in annual financial statements. This FSP also amends APB Opinion No. 28, Interim Financial Reporting, to require those disclosures in summarized financial information at interim reporting periods. This FSP shall be effective for interim reporting periods ending after June 15, 2009. The Company will comply with the additional disclosure requirements beginning in the second quarter of 2009.

In April 2009, the FASB issued FSP FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments. This FSP requires entities to separate any other-than-temporary impairment of a debt security into two components when there are credit related losses associated with the impaired debt security for which management asserts that it does not have the intent to sell the security, and it is more likely than not that it will not be required to sell the security before recovery of its cost basis. The amount of the other-than-temporary impairment related to a credit loss is recognized in earnings, and the amount of the other-than-temporary impairment related to other factors is recorded in other comprehensive loss. This FSP shall be effective for periods ending after June 15, 2009, with early adoption permitted for periods ending after March 15, 2009. The Company currently does not have any debt security investments.

In April 2009, the SEC released Staff Accounting Bulletin No. 111 (“SAB 111”) which amends SAB Topic 5-M. SAB 111 notes that FSP No. 115-2 and FAS 124-2 were scoped to debt securities only, and the FSP referred readers to SEC SAB Topic 5-M for factors to consider with respect to other-than-temporary impairments for equity securities. With the amendments in SAB 111, debt securities are excluded from the scope of Topic 5-M, but the SEC staff’s views on equity securities are still included within the topic. The Company currently does not have any financial assets that are other-than-temporary impaired.

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

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

Forward Looking Statement Notice

Certain statements made in this Quarterly Report on Form 10-Q are “forward-looking statements” (within the meaning of the Private Securities Litigation Reform Act of 1995) in regard to the plans and objectives of management for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Scout Acquisition, Inc. (“we”, “us”, “our” or the “Company”) to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company's plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance the forward-looking statements included in this Quarterly Report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.

Description of Business

The Company was incorporated in the State of Delaware on January 3, 2006 and maintains its principal executive office at c/o Sands Brothers Venture Capital LLC, 90 Park Avenue, 31st Floor, New York, NY 10016. Since inception, the Company has been engaged in organizational efforts and obtaining initial financing. The Company was formed as a vehicle to pursue a business combination through the acquisition of, or merger with, an operating business. The Company filed a Registration Statement on Form 10-SB with the U.S. Securities and Exchange Commission (the “SEC”) on June 30, 2006, and since its effectiveness, the Company has focused its efforts to identify a possible business combination.

The Company, based on proposed business activities, is a “blank check” company. The SEC defines those companies as "any development stage company that is issuing a penny stock, within the meaning of Section 3(a)(51) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and that has no specific business plan or purpose, or has indicated that its business plan is to merge with an unidentified company or companies." Many states have enacted statutes, rules and regulations limiting the sale of securities of "blank check" companies in their respective jurisdictions. The Company is also a “shell company,” defined in Rule 12b-2 under the Exchange Act as a company with no or nominal assets (other than cash) and no or nominal operations. Management does not intend to undertake any efforts to cause a market to develop in our securities, either debt or equity, until we have successfully concluded a business combination. The Company intends to comply with the periodic reporting requirements of the Exchange Act for so long as we are subject to those requirements.

The Company was organized as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held corporation. The Company’s principal business objective for the next 12 months and beyond such time will be to achieve long-term growth potential through a combination with an operating business. The Company will not restrict its potential candidate target companies to any specific business, industry or geographical location and, thus, may acquire any type of business.

The Company currently does not engage in any business activities that provide cash flow. During the next twelve months we anticipate incurring costs related to:

(i) filing Exchange Act reports, and

(ii) investigating, analyzing and consummating an acquisition.

We believe we will be able to meet these costs through use of funds in our treasury, through deferral of fees by certain service providers and additional amounts, as necessary, to be loaned to or invested in us by our stockholders, management or other investors.

The Company may consider acquiring a business which has recently commenced operations, is a developing company in need of additional funds for expansion into new products or markets, is seeking to develop a new product or service, or is an established business which may be experiencing financial or operating difficulties and is in need of additional capital. In the alternative, a business combination may involve the acquisition of, or merger with, a company which does not need substantial additional capital but which desires to establish a public trading market for its shares while avoiding, among other things, the time delays, significant expense, and loss of voting control which may occur in a public offering.

Since our Registration Statement on Form 10-SB went effective, our management has had contact and discussions with representatives of other entities regarding a business combination with us. Any target business that is selected may be a financially unstable company or an entity in its early stages of development or growth, including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we may effect a business combination with an entity in an industry characterized by a high level of risk, and, although our management will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess all significant risks.

The Company anticipates that the selection of a business combination will be complex and extremely risky. Because of general economic conditions, rapid technological advances being made in some industries and shortages of available capital, our management believes that there are numerous firms seeking even the limited additional capital which we will have and/or the perceived benefits of becoming a publicly traded corporation. Such perceived benefits of becoming a publicly traded corporation include, among other things, facilitating or improving the terms on which additional equity financing may be obtained, providing liquidity for the principals of and investors in a business, creating a means for providing incentive stock options or similar benefits to key employees, and offering greater flexibility in structuring acquisitions, joint ventures and the like through the issuance of stock. Potentially available business combinations may occur in many different industries and at various stages of development, all of which will make the task of comparative investigation and analysis of such business opportunities extremely difficult and complex.

Liquidity and Capital Resources

As of March 31, 2009 and 2008, the Company had assets equal to $43,203, comprised exclusively of cash and prepaid expenses. This compares with assets of $5,438, comprised exclusively of cash and prepaid expenses, as of December 31, 2008. The Company’s current liabilities as of March 31, 2009 totaled $49,604, comprised exclusively of accounts payable and accrued expenses, loans payable to stockholders and accrued interest payable to stockholders. This compares to the Company’s current liabilities as of December 31, 2008 of $3,861, comprised exclusively of accounts payable and accrued expenses. The Company can provide no assurance that it can continue to satisfy its cash requirements for at least the next twelve months.

The following is a summary of the Company's cash flows provided by (used in) operating, investing, and financing activities for the three months ended March 31, 2009 and March 31, 2008 and for the cumulative period from January 3, 2006 (inception) to March 31, 2009:

	For the Three Months Ended March 31, 2009			For the Three Months Ended March 31, 2008			For the Cumulative Period from January 3, 2006 (Inception) to March 31, 2009
Net cash used in operating activities	$	(360	)	$	(6,684	)	$	(112.422	)
Net cash used in investing activities	$	-		$	-		$	-
Net cash provided by financing activities	$	40,000		$	35,000		$	153,750
Net increase in cash	$	39,640		$	28,316		$	41,328

The Company has nominal assets and has generated no revenues since inception. The Company is also dependent upon the receipt of capital investment or other financing to fund its ongoing operations and to execute its business plan of seeking a combination with a private operating company. In addition, the Company is dependent upon certain related parties to provide continued funding and capital resources. If continued funding and capital resources are unavailable at reasonable terms, the Company may not be able to implement its plan of operations.

Results of Operations

The Company has not conducted any active operations since inception, except for its efforts to locate suitable acquisition candidates. No revenue has been generated by the Company from January 3, 2006 (inception) to March 31, 2009. It is unlikely the Company will have any revenues unless it is able to effect an acquisition or merger with an operating company, of which there can be no assurance. It is management's assertion that these circumstances may hinder the Company's ability to continue as a going concern. The Company’s plan of operation for the next twelve months shall be to continue its efforts to locate suitable acquisition candidates.

For the three months ended March 31, 2009, the Company had a net loss of $11,616 consisting of interest expense on stockholder loans and legal, accounting, audit and other professional service fees incurred in relation to the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2008 in March of 2009. This compares with a net loss of $11,861 for the three months ended March 31, 2008, consisting of interest expense on stockholder loans and legal, accounting, audit and other professional service fees incurred in relation to the filing of the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2007 in March of 2008.

For the cumulative period from January 3, 2006 (inception) to March 31, 2009, the Company had a net loss of $133,569, consisting of interest expense on stockholder loans and legal, accounting, audit and other professional service fees incurred in relation to the formation of the Company, the filing of the Company’s Registration Statement on Form 10-SB in June of 2006, the filing of the Company’s Quarterly Reports on Form 10-QSB and Form 10-Q and the filing of the Company’s Annual Reports on Form 10-KSB and Form 10-K.

Off-Balance Sheet Arrangements

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

Contractual Obligations

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

Item 4T. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules, regulations and related forms, and that such information is accumulated and communicated to our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

As of March 31, 2009, we carried out an evaluation, under the supervision and with the participation of our principal executive officer and our principal financial officer of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Controls

There have been no changes in our internal controls over financial reporting during the quarter ended March 31, 2009 that have materially affected or are reasonably likely to materially affect our internal controls.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

To the best knowledge of our officers and directors, the Company is not a party to any legal proceeding or litigation.

Item 1A. Risk Factors.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

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.

On February 22, 2007, the Company issued four promissory notes, bearing eight and one quarter percent (8.25%) interest annually, in the principal amounts of $4,375, $8,750, $17,500, and $4,375 to Sands Brother Venture Capital, LLC (“SBV”), Sands Brothers Venture Capital II, LLC (“SBV-II”), Sands Brothers Venture Capital III, LLC (“SBV-III”), and Sands Brothers Venture Capital IV, LLC (“SBV-IV”), respectively (the “February 2007 Notes”). The February 2007 Notes and all accrued interest mature upon completion of a merger, and if no merger is consummated, then the February 2007 Notes were to reach maturity on February 22, 2009. On March 27, 2009, the Company entered into an Amended and Restated Promissory Note for each of the February 2007 Notes, extending the maturity date of the February 2007 Notes to December 31, 2010.

On March 27, 2009, the Company issued four additional promissory notes, bearing eight and one quarter percent (8.25%) interest annually, in the principal amounts of $5,000, $10,000, $20,000, and $5,000 to SBV, SBV-II, SBV-III, and SBV-IV, respectively (the “March 2009 Notes”). The March 2009 Notes and all accrued interest mature upon completion of a merger, and if no merger is consummated, then the 2008 Notes will reach maturity on March 27, 2011.

Except as otherwise indicated herein, there have been no related party transactions, or any other transactions or relationships required to be disclosed pursuant to Item 404 of Regulation S-B.

Item 6. Exhibits.

(a) Exhibits required by Item 601 of Regulation S-K.

Exhibit		Description

*3.1		Certificate of Incorporation, as filed with the Delaware Secretary of State on January 3, 2006.

*3.2		By-Laws.

31.1		Certification of the Company’s Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009.

31.2		Certification of the Company’s Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with respect to the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2009.

32.1		Certification of the Company’s 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 the Company’s Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*	Filed as an exhibit to the Company’s Registration Statement on Form 10-SB, as filed with the Securities and Exchange Commission on June 30, 2006 and incorporated herein by this reference.

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.

Dated: May 13, 2009	SCOUT ACQUISITION, INC.

	By:	/s/ Scott Baily
		Scott Baily
		President, Secretary, and Director
		Principal Executive Officer
		Principal Financial Officer

SCOUT ACQUISITION INC 10-Q