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U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549


FORM 10-SB


GENERAL FORM FOR REGISTRATION OF SECURITIES

OF SMALL BUSINESS ISSUERS

Under Section 12(b) or 12(g) of the Securities Act of 1934


EASTBRIDGE INVESTMENT GROUP CORPORATION

(Name of Small Business Issuer in its Charter)

 

                                    Arizona                                                             86-1032927                        

(State or Other Jurisdiction of Incorporation or Organization)           (IRS Employer Identification No.)


                                                                                                                    
2129 East Cedar Street, Unit 30, Tempe, Arizona 85282

(Address of Principal Executive Offices)      (Zip Code)


(480) 966 2020

 Issuer's Telephone Number


Securities to be registered under Section 12(b) of the Act:


Title of Each Class to be so Registered

Name of Each Exchange

on Which Each Class is to be Registered

     


                  None                                                                                                                       None 


Securities to be registered under Section 12(g) of the Act:

 

Common Stock

(Title of Class)






ITEM 1.    DESCRIPTION OF BUSINESS

 

History and Development of the Company


EastBridge Investment Group Corporation (formerly known as ATC Technology Corporation) (the "Company" or “EastBridge”) was incorporated in the state of Arizona on June 25, 2001.  The Company’s principle activity through June 30, 2005 was to manufacture mobile entertainment products, including VidegoTM, MoviegoTM and GamegoTM.  The VidegoTM and MoviegoTM are car theater systems available to consumers. The GamegoTM provides a means to play video game consoles made by Sony, Microsoft and Nintendo, in the car, RV, SUV, van or boat with attachable viewing monitors.   


On August 23, 2002, the Company entered into an agreement with Providential Holding, Inc. (PHI) to sell all the issued and outstanding shares of the Company. The transaction between the original stockholders and PHI was consummated as of October 17, 2003.  On June 30, 2005 the Company and PHI, agreed to financial and ownership restructuring and executed a formal agreement to return the majority ownership of the Company to its original stockholders in exchange for a forgiveness of notes and obligations owed to the Company and its original stockholders.  As a result of the re-structuring, PHI has become a minority stock holder and the original stockholders of the Company have become the majority stockholders as a group.  The newly structured Company decided to change its name to EastBridge Investment Group Corporation effective August 1, 2005 to more accurately reflect its new business focus on investment projects.


In 2005, EastBridge decided to exit the mobile video game market and dedicate itself to providing financial related services in Asia, with a strong focus on the high GDP growth countries and territories such as Hong Kong, China, Macao, Taiwan, and India. The Company will initially concentrate on researching growing investment opportunities in Chinese territories including Hong Kong, China, Macao, and Taiwan.  Its products will be financial services that help small-to-medium-size companies obtain capital to grow their business.  The Company’s financial services will be in the form of small public offerings, Joint Ventures, Wholly Foreign Owned Enterprises, Guaranteed Return Ventures, investment banking, financial advisory services or any other financial services allowed by the local government and in compliance with the United States Securities Exchange Commission regulations. In addition, the Company will also provide marketing, sales, and strategic planning services for its clients to assist them in entering the United States market.

 

EastBridge is one of the few U.S. companies solely concentrated in marketing financial services to the small-to-medium-size Asian companies that need financial services to help them expand in their local markets.  When EastBridge sees a unique opportunity in the business sectors, it will form its own foreign subsidiaries with local partners to capture the opportunity.


Overview


Our business is to provide financial services including public offering guidance, joint venture, and merchant banking services to the small-to-medium-size businesses in Chinese territories and India.


Our operations are divided into individual business units by industry such as the Electronics, Real estate, Auto Metal, Energy Environmental, Bio Science, and Food Retail Distribution units. Our target clients are mostly in India, China, Hong Kong, Macao and Taiwan. Our business focus is very narrow, but deep. We go after opportunities that can create true value for our shareholders and the clients. We are only interested in business opportunities where the decision process is simple. Thus, we focus on short-term opportunities where the expected return is within about one year and the potential gain is substantial for both parties. We generally look for deals where we can help to uncover the hidden values after our participation. Keith Wong (President and Chief Executive Officer) and Norman Klein (Chief Financial Officer) each has over twenty years of experience in the industrial, sales and financial industries. We can understand our client's products quickly and are able to make a fast and decisive move to capture the opportunity. We plan China, Hong Kong, Macao and Taiwan to be our immediate fees and revenue centers in 2006. We plan to expand into India in the later part of 2007.   

 

Products and Marketing


Our main business is to provide initial public offerings, joint ventures, and merchant banking services to the small businesses in China and India. We increase our shareholders’ value by:


a) Earning fees and stock equity in the companies we take public, or cause to be acquired;

    

b) Making cash income by operating joint ventures with local partners to take advantage of any short-term and high-return

    business opportunities and;

 

c) Earning fees in providing merchant banking services to small Asian companies to access US funds.



Business Strategy


We believe that in the next ten years, China and India will offer lucrative opportunities for EastBridge's shareholders. We plan to search for small to medium size companies that have demonstrated either a steady income stream or are ready to launch a commercially exciting new product that offers double digit growth in market share for the next five years. Our pursuit for high ROI (return on investment) and ROE (return on equity) is relentless. Due to a combined history of more than 30 years of hands-on experience in China from Mr. Keith Wong, Chief Executive Officer, and Mr. Norm Klein, our Chief Operating Officer, very few companies can match our expertise with China. Further, since larger companies are bureaucratic and generally not interested in the small- to-medium-size companies, we believe we have a clear and imminent advantage.


Competition  

 

We are faced with competition from major brokerage and financial service companies from Wall Street (such as Goldman Sachs, Bear Stearns, JP Morgan and Lehman Brothers, etc.) as well as smaller companies. However, the major companies may find the smaller Asian companies to be uneconomical for their resource investment. The smaller companies may lack the knowledge capital to penetrate the barriers from geography, political, language, culture, and economies of scale. In due time, the expected higher returns on investment in China and India may attract new competitors. However, due to the market size of China and India, a handful of new competitors may provide potential benefit for the industry. Thus, we believe we can successfully compete with our competitors.


Industry and Customers


There are a combined total of about 600,000 small-to-medium-size companies in China and India. There are over 400,000 small businesses in China alone and the numbers are growing at double digits. We have the early mover advantage in this market, which is big enough to accommodate many more players.


The services we offer to these 600,000+ companies will remain as high growth areas for many years to come.


Patents, Trademarks, License, Franchises, Concessions, Royalty Agreements or Labor Contracts, Including Duration


Employment Agreement with Keith Wong


On June 1, 2005, we entered the employment agreement with Keith Wong, our President and Chief Executive Officer. The agreement provides for annual compensation in the amount of $240,000, effective June 1, 2005. This agreement shall begin on the date entered above, and shall continue until terminated as provided. (See Exhibit 10.1)  


Mr. Wong’s agreement contains confidentiality, and non-competition and good faith cooperation covenants. The agreement may be terminated by either party with or without cause and without prior notice subject to the termination provisions as discussed. (See Exhibit 10.1)

 

Employment Agreement with Norm Klein


On June 1, 2005, we entered the employment agreement with Norm Klein, our Chief Financial Officer, Chief Operating Officer and Investor Relations Officer. The agreement provides for annual compensation in the amount of $84,000, effective on June 1, 2005 and will be increased to an annual compensation of $180,000, effective January 1, 2007. This agreement shall begin on the date entered above, and shall continue until terminated as provided. (See Exhibit 10.2)  


Mr. Klein’s agreement contains confidentiality, and non-competition and good faith cooperation covenants. The agreement may be terminated by either party with or without cause and without prior notice subject to the termination provisions as discussed. (See Exhibit 10.2)



Government Approval and Regulation of Industry

 

The Company faces risks posed by any adverse laws and regulations affecting our business plans by the US and foreign governments. In order to conduct our business in China and India, we will need to obtain some or all of the following licenses, approvals and/or concessions from the country we are in: Business registration, Tax certificate, Right to conduct Business, Employment Approval, Residency Approval, Asset Appraisal, Acquisition Approval, Import/Export License and Foreign Remission Approval. The list is subject to additions, dependant on a particular business sector we decide to enter in China or India. We are subject to government approvals and concessions. There are no proclamations that we need to obtain all of the approvals and licenses above; nor is there a guarantee that we will obtain any of the approvals and licenses when we are required to do so.

 

Research and Development


Keith Wong and Norm Klein have spent about $62,000 in travel expenses to Asia for business development.  


Workforce

 

We now have two full time employees. Once we are re-capitalized, we plan to have five full time employees in Beijing, China and three full time employees in Phoenix, Arizona. We are a knowledge- based financial services company. We do not anticipate carrying a big head-count overhead. In the latter part of 2007, we plan to set up another field office in Mumbai, India.

 

Code of Ethics

 

We have adopted a "Code of Ethics for Directors, Officers and Employees" that applies to all employees, including our executive officers. A copy of our Code of Ethics for Directors, Officers and Employees will be filed with the Securities and Exchange Commission as Exhibit 14.1 to this Registration Statement.




 

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.


Significant Accounting Policies


Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Note 2 of the Notes to Consolidated Financial Statements describes the significant accounting policies used in the preparation of the consolidated financial statements. Certain of these significant accounting policies are considered to be critical accounting policies, as defined below.


A critical accounting policy is defined as one that is both material to the presentation of our financial statements and requires management to make difficult, subjective or complex judgments that could have a material effect on our financial condition and results of operations. Specifically, critical accounting estimates have the following attributes: 1) we are required to make assumptions about matters that are highly uncertain at the time of the estimate; and 2) different estimates we could reasonably have used, or changes in the estimate that are reasonably likely to occur, would have a material effect on our financial condition or results of operations.


Estimates and assumptions about future events and their effects cannot be determined with certainty. We base our estimates on historical experience and on various other assumptions believed to be applicable and reasonable under the circumstances. These estimates may change as new events occur, as additional information is obtained and as our operating environment changes. These changes have historically been minor and have been included in the consolidated financial statements as soon as they became known. Based on a critical assessment of our accounting policies and the underlying judgments and uncertainties affecting the application of those policies, management believes that our consolidated financial statements are fairly stated in accordance with accounting principles generally accepted in the United States, and present a meaningful presentation of our financial condition and results of operations. We believe the following critical accounting policies reflect our more significant estimates and assumptions used in the preparation of our consolidated financial statements:


Use of Estimates


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


Cash and Cash Equivalents


The Company considers all liquid debt instruments with an original maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.


Deposit

 

As of June 30, 2006, the Company had a security deposit of $1,828.


Revenue Recognition


The Company's revenue recognition policies are in compliance with Staff Accounting Bulletin (SAB) 104. Revenue is recognized when merchandise is shipped to a customer when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectibility is reasonably assured. Generally, the Company extends credit to its customers/clients and does not require collateral. The Company performs on-going credit evaluations of its customers/clients.  Any payments received before all of the relevant criteria for revenue recognition are recorded as unearned revenue.


Income Taxes


Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income (loss). Valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.



Fair Value of Financial Instruments


Statement of financial accounting standard No. 107, Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amount of all financial instruments at December 31, 2005 and 2004, which consist of various notes and loans payable, approximate their fair values.


Net Loss per Share


The Company adopted the provisions of Statement of Financial Accounting Standards No. 128, Earnings per Share ("SFAS No. 128"). SFAS No. 128 eliminates the presentation of primary and fully diluted earnings per share ("EPS") and requires presentation of basic and diluted EPS. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period.  Diluted EPS is based on the weighted average number of shares of common stock outstanding for the period and common stock equivalents outstanding at the end of the period.


Stock-based Compensation


SFAS No. 123 prescribes accounting and reporting standards for all stock-based compensation plans, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. SFAS No. 123 requires compensation expense to be recorded (i) using the new fair value method or (ii) using the existing accounting rules prescribed by Accounting Principles Board Opinion No. 25, “Accounting for stock issued to employees” (APB 25) and related interpretations with proforma disclosure of what net income and earnings per share would have been had the Company adopted the new fair value method. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" and has adopted the disclosure only provisions of SFAS 123.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock.


The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Valuation of shares for services is based on the estimated fair market value of the services performed.


Segment Reporting


Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure About Segments of an Enterprise and Related Information" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. SFAS 131 has no effect on the Company's financial statements as substantially all of the Company's operations are conducted in one industry segment.



Risks and Uncertainties

 

In the normal course of business, the Company is subject to certain risks and uncertainties. 

 

The Company Provides Its Product On Unsecured Credit.

 

Since the Company provides its products on unsecured credit to most customers, the Company's ability to collect the amounts due from customers is affected by economic fluctuations and each customer's ability to pay. 

 

The Company Has A Limited Operating History.

  

The Company itself has a limited operating history. Businesses, which are starting up, or in their initial stages of development, present substantial business and financial risks and may suffer significant losses from which they cannot recover. The Company will face all of the challenges of a new business enterprise, including but not limited to, locating suitable office space, engaging the services of qualified support personnel and consultants, establishing budgets and implementing appropriate financial controls and internal operating policies and procedures. The Company will need to attract and retain a number of key employees and other service personnel. Further, there is no assurance that the Company will be able to successfully continue its operations or that it will ever operate profitably.


The Company's Additional Financing Requirements Could Result in Dilution to Existing Stockholders.

  

The additional financings which the Company will require may in the future be obtained through one or more transactions which will effectively dilute the ownership interests of stockholders.  The Company has the authority to issue additional shares of common stock and preferred stock, as well as additional classes or series of ownership interests or debt obligations which may be convertible into any one or more classes or series of ownership interests.  The Company is authorized to issue 300,000,000 million shares of common stock and 100,000,000 million shares of preferred stock.  Such securities may be issued without the approval or other consent of the Company's stockholders.

 

Potential and Actual Legislation and Regulation Related to the Company's Business Could Limit its Activities and Deprive the Company of its Anticipated Source of Future Revenues.  

  

The Company faces risks posed by any adverse laws and regulations affecting our business plans by the US and foreign governments. In order to conduct our business in China and India, we will need to obtain some or all of the following licenses, approvals and/or concessions from the country we are in: Business registration, Tax certificate, Right to conduct Business, Employment Approval, Residency Approval, Asset Appraisal, Acquisition Approval, Import/Export License and Foreign Remission Approval. The list is subject to additions, dependant on a particular business sector we decide to enter in China or India. We are subject to government approvals and concessions. There are no proclamations that we need to obtain all of the approvals and licenses above; nor is there a guarantee that we will obtain any of the approvals and licenses when we are required to do so.

  

The Company May Not Be Able To Compete Successfully Against Large Competitors.  

 

The Company is faced with competitors from major brokerage and financial service companies as well as smaller companies, with competent advertising and marketing capabilities. Thus, we anticipate that we may not be able to compete effectively.

  

The Company Depends On Our Executive Officers And Key Personnel To Implement Our Business Strategy And Could Be Harmed By The Loss Of Their Services.  

 

Keith Wong is the current President, Chief Executive Officer, and Director of the Company.  We believe that our growth and future success will depend significantly upon the skills of Mr. Wong and the ability to attract a skilled management team. The competition for qualified personnel in our industry is intense, and the loss of our key personnel or an inability to attract, retain and motivate key personnel could adversely affect our business. We cannot assure that we will be able to retain our existing key personnel.

 

The Company May Be Subject To Litigation That Will Be Costly To Defend Or Pursue And Uncertain In Its Outcome.  

  

The Company's business may bring it into conflict with others with whom it has contractual or other business relationships or with its competitors or others whose interests differ from the Company's.  If the Company is unable to resolve those conflicts on terms that are satisfactory to all parties, the Company may become involved in litigation brought by or against it. That litigation is likely to be expensive and may require a significant amount of management's time and attention, at the expense of other aspects of the Company's business. The outcome of litigation is always uncertain, and in some cases could include judgments against us that require the Company to pay damages, enjoin it from certain activities, or otherwise affect its legal or contractual rights, which could have a significant adverse effect on its business. 


 

Revenues


Revenues for the three months ended March 31, 2006 and six months ended June 30, 2006 were both $ 5,370. Revenues for the twelve months ended December 31, 2005 and December 31, 2004 were approximately $15,904 and $ 58,326, respectively.

 

General and Administrative Expenses


General and administrative expenses for the three months ended March 31, 2006 and six months ended June 30, 2006 were $ 3,191 and $ 6,049, respectively. General and administrative expenses for the twelve months ended December 31, 2005 and December 31, 2004 were approximately $ 45,318 and $ 215,401, respectively. The decrease in 2005 was due to a reduction in our production workers when we decided to wind down our electronics business.


The Company’s policy is to expense advertising costs as incurred.  No advertising was expensed during the first and second quarter of 2006. Advertising expenses for the year ended December 31, 2005 and 2004 were $207 and $87,297, respectively and are included in general and administrative expense. The reduction in 2005 was due to our focus away from the electronics business. No advertising was expensed during the first and second quarter of 2006.


Other Income/Loss


Other income (loss) for the twelve months ended December 31, 2005 and December 31, 2004 were approximately $(9,082) and $ 156,702, respectively.


Net Loss


Net losses for the three months ended March 31, 2006 and six months ended June 30, 2006 were $(69,490) and $(148,637), respectively. Net losses for the twelve months ended December 31, 2005 and December 31, 2004 were approximately $(298,026) and $(106,048), respectively.



Recent Accounting Pronouncements


In November 2004, the FASB has issued FASB Statement No. 151, "Inventory Costs, an Amendment of ARB No. 43, and Chapter 4" ("FAS No. 151").  The amendments made by FAS No. 151 are intended to improve financial reporting by clarifying that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and by requiring the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities.


The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005.  Earlier application is permitted for inventory costs incurred during fiscal years beginning after November 23, 2004.  The provisions of FAS No. 151 will be applied prospectively.  The Company does not expect the adoption of FAS No. 151 to have a material impact on its consolidated financial position, results of operations or cash flows.


In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123" ("FAS No. 123R").  FAS No. 123R requires companies to recognize in the statement of operations the grant- date fair value of stock options and other equity-based compensation issued to employees.  FAS No. 123R is effective beginning in the Company's first quarter of fiscal 2006.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

 

In December 2004, the FASB issued SFAS Statement No. 153, "Exchanges of Nonmonetary Assets."  The Statement is an amendment of APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance.  The Company believes that the adoption of this standard will have no material impact on its financial statements.


In March 2004, the Emerging Issues Task Force ("EITF") reached a consensus on Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments." The EITF reached a consensus about the criteria that should be used to determine when an investment is considered impaired, whether that impairment is other-than-temporary, and the measurement of an impairment loss and how that criteria should be applied to investments accounted for under SFAS No. 115, "ACCOUNTING IN CERTAIN INVESTMENTS IN DEBT AND EQUITY SECURITIES." EITF 03-01 also included accounting considerations subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. Additionally, EITF 03-01 includes new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the Financial Accounting Standards Board (FASB) delayed the accounting provisions of EITF 03-01; however the disclosure requirements remain effective for annual reports ending after June 15, 2004. The Company will evaluate the impact of EITF 03-01 once final guidance is issued.


In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections." This statement applies to all voluntary changes in accounting principle and requires retrospective application to prior periods' financial statements of changes in accounting principle, unless this would be impracticable. This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error. This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this interpretation will have on its financial position, cash flows and results of operations.


In June 2005, the EITF reached consensus on Issue No. 05-6, Determining the Amortization Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance on determining the amortization period for leasehold improvements acquired in a business combination or acquired subsequent to lease inception. The guidance in EITF 05-6 will be applied prospectively and is effective for periods beginning after June 29, 2005.  EITF 05-6 is not expected to have a material effect on its consolidated financial position or results of operations.


In December 2004, the FASB issued FASB No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123."  FASB Statement No. 123R requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees.  FASB No. 123R is effective beginning January 1, 2006.  FASB Statement No. 123R on is not expected to have a material effect on its consolidated financial position or results of operations.


In May 2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections.”  This statement applies to all voluntary changes in accounting principle and requires retrospective application to the prior periods’ financial statements of changes in accounting principle, unless this retrospective application would be impracticable.  This statement also makes a distinction between “retrospective application” of an accounting principle and the “restatement” of financial statements to reflect the correction of an error.  This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this statement will have on its financial position, cash flows and results of operations.


In February 2006, the FASB issued SFAS No. 155, “Accounting for Certain Hybrid Financial Instruments—an amendment of FASB Statements No. 133 and 140.”  This Statement amends FASB Statements No. 133, “Accounting for Derivative Instruments and Hedging Activities,” and No. 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities.”  This Statement resolves issues addressed in FASB Statement No. 133 Implementation Issue No. D1, “Application of Statement 133 to Beneficial Interests in Securitized Financial Assets.” The Company believes that the adoption of this standard will have no material impact on its consolidated financial statements.

 

In March 2006 FASB issued SFAS 156, “Accounting for Servicing of Financial Assets.”  This Statement amends FASB Statement No. 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities,” with respect to the accounting for separately recognized servicing assets and servicing liabilities. This Statement: (1) Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract; (2) Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable;  (3) Permits an entity to choose ‘Amortization method’ or ‘Fair value measurement method’ for each class of separately recognized servicing assets and servicing liabilities; (4) At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entity’s exposure to changes in fair value of servicing assets or servicing liabilities that a server elects to subsequently measure at fair value; (5) Requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the Balance Sheet and additional disclosures for all separately recognized servicing assets and servicing liabilities.

 

This Statement is effective as of the beginning of the Company’s first fiscal year that begins after September 15, 2006. Management believes that this statement will not have a significant impact on the financial statements.




Liquidity and Capital Resources


In the three months ended March 31, 2006 and six months ended June 30, 2006, we had cash and cash equivalents of $ 2,751 and $2, 741, respectively. In year end December 31, 2005 and December 31, 2004, we had cash and cash equivalents of $1,803 and $ 1,225, respectively.

 

Our operating activities used $ 947 and $ 938 in three months and six months ended March 31, 2006 and June 30, 2006, respectively. Changes in accounts payable and accrued expenses in three months ended March 31, 2006 and six months ended June 30, 2006 were $ 9,188 and $ 18,375. Our operating activities used $516,936 and $303,224 in years ended December 31, 2005 and 2004, respectively. Changes in accounts payable and accrued expenses decreased from $ 581,010 in 2004 to $ 357,591 in 2005.

 

Cash provided from financing activities increased to $517,514 in December 2005 from $304,449 in December 2004, primarily due to an increase in borrowings on notes payable from the major stockholders. On June 30, 2005, all these notes were forgiven as a result of a debt and equity re-structuring.


Our operations are currently financed through various loans. Management has taken action and is formulating additional plans to strengthen the Company's working capital position and generate sufficient cash to meet its operating needs. In addition, the Company also anticipates generating more revenue through its proposed new business plan. No assurances can be made that management will be successful in achieving its plan or that additional capital will be available on a timely basis or at acceptable terms.


 The Company expects that the working capital cash requirements over the next 12 months will be generated from operations and additional financing. Management has taken action and is formulating additional plans to strengthen the Company's working capital position and generate sufficient cash to meet its operating needs.


  



ITEM 3. DESCRIPTION OF PROPERTY.


Our executive office is located at 2101 E. Broadway St., #30, Tempe, Arizona 85282. We lease these facilities, consisting of approximately 300 square feet, for $ 527.48 per month.  The term of our lease is on a Month to Month basis.  


The aforesaid properties are in good condition and we believe they will be suitable for our purposes for the next 12 months.  There is no affiliation between us or any of our principals or agents and our landlords or any of their principals or agents.

 

 

ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

 

The table below lists, as of October 30, 2006, all persons/companies the Registrant is aware of as being the beneficial owner of more than five percent (5%) of the common stock of the Registrant.

                               

Title of Class

Name of Beneficial Owner

Amount & Nature of

Beneficial Ownership

Percent of Class

Common

Keith Wong

50,369,240

 51%

Common

High Performance Edge, LLC.

13,166,720

 13%

Common

Providential Holding Corporation

10,000,000

 10%

Total

 

73,535,960

 74%


    Note: Based on 98,339,392 common shares outstanding as of October 30, 2006.

 

           

The table below lists all Directors and Executive Officers who beneficially own the Registrant's voting securities and the amount of the Registrant's voting securities owned by the Directors and Executive Officers as a group, as of October 30, 2006.

 

 

Title of Class

Name of Beneficial Owner

Amount and Nature of Beneficial Ownership

Percent of Class

Common

Keith Wong

50,369,240

 51%

Common

Norm Klein

3,000,000

 3%

 

 

 

 

Total

 

53,000,000

54 %


 

ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.

 

Name

Address

Position

Age

Keith Wong

2129 East Cedar Street, Unit 30, Tempe, Arizona 85282

President, CEO, Director

52

Norm Klein

2129 East Cedar Street, Unit 30, Tempe, Arizona 85282

CFO, COO, IRO, Director

56

Leo Dembinski 2129 East Cedar Street, Unit 30, Tempe, Arizona 85282  Director 63





 (a)  Directors and Executive Officers

 

Keith Wong – President, Chief Executive Officer, and Director


Mr. Wong brings 22 years of experience in sales, business management, finance, manufacturing, Asian suppliers and Asian business networks.

Since 2001, Mr. Wong has acted as the President and CEO of ATC Technology Group, which later became EastBridge Investment Group Corporation.

From 1989 to 2001, Mr. Wong was the President and CEO of Amtel International Corporation, where he built the company into a leader in selling promotional TV and small appliances. This company designed and imported televisions and small appliances from Asia.  Mr. Wong built this company from scratch and increased sales from zero to more than $8,000,000 per year.  This company provided valuable experiences to Mr. Wong in the electronic business by working with international suppliers and several top U.S. chain stores including Kmart and Wal-Mart. It won many acclaims for its products including a design award, Innovations 2001 Design and Engineering Award, from the Industrial Society of America and the Consumer Electronics Association. 

From 1986 to 1989, Mr. Wong was a sales executive with Coherent, Inc. for Asia-Pacific for four years. Mr. Wong demonstrated his management capabilities in Asia. Prior to his sales experience, Mr. Wong was an electronic design engineer for several high tech companies including ComputerVision, Tektronix and General Electric, where he was awarded with the prestigious Ed Woll’s Young Engineer Award in 1980 for his efforts in improving military jet engine manufacturing.

Mr. Wong holds a Bachelors and Masters degree in electrical engineering from Rutgers University and Northeastern University, respectively. Mr. Wong successfully completed several corporate finance courses for executives from Harvard University. Mr. Wong also holds two U.S. utility patents and one U.S. design patent.

Mr. Wong is a board member of Asian Bank of Arizona and a member of Beijing Equity Exchange.


Norm Klein - Chief Financial Officer, Chief Operating Officer and Investor Relations Officer


Mr. Klein has over twenty years of experience in manufacturing and process control through working with major companies. Mr. Klein also brings his expertise in engineering, operational leadership, and business management skills to EastBridge.

Since 2001, Mr. Klein has acted as the CFO, COO, and IRO for ATC Technology Group, which later became known as EastBridge Investment Group Corporation. 

Since 1997, Mr. Klein has been the owner and consultant of High Performance Edge, Inc. The firm provides consulting services in the areas of leadership development, organization development and process improvement. Firm also provides startup management expertise for companies that want to increase sales and operational capacity. The firm's clients include Clorox, Honeywell/Allied Signal, Ingersol Rand, Durel Corporation, and Dreyers Ice Cream Company.

From 1972 to 1993, Mr. Klein was employed at Procter & Gamble, where he was responsible for the operational aspects of the company’s Metamucil business. Mr. Klein provided the leadership role for a $60 million manufacturing plant expansion and managed an operating budget in excess of $30 million. Further, as a member of Procter & Gamble’s Profit and Loss team for its Hair Care business, Mr. Klein led the launch of the first shampoo and conditioner product, Pert shampoo.  This quickly grew to be a $100 million business that required extensive resources and leadership to meet consumer demand.  The successful launch propelled P&G’s hair care business to the number one position in the market based on market share.

Mr. Klein provides EastBridge with high quality business management, strategic planning and financial system development experience.  His knowledge of operations and finance will be invaluable as EastBridge expands its operational capabilities and launches new services in the near future.

Mr. Klein holds a Bachelors degree in mechanical engineering from Rose Hulman Institute and a Masters degree in business administration from University of Iowa.


Leo Dembinski, Director


Mr. Dembinski has over ten years of experience in corporate finance and corporate risk management experience. In the summer of 1990 Mr. Dembinski co-founded a planning and capital formation group: Addem and Associates Inc.  


In the fall of 2000 Mr. Dembinski entered into a partnership known as High Performance Edge L.L.C (HPE).   HPE is a management consulting firm specializing in the active management of its clients companies.  HPE also acts as a private investor in some of its transactions.


Mr. Dembinski has served on many organizations during his career, which include: President of the Chicago Retail Financial Executive Association, Chairman of the Associated Merchandising Corporation, a national organization, Financial Executives Division. He was also co-chairman of the Direct Marketing Association Catalog Leaders. He served as a past director for the Bank of Lakehurst, in Waukegan, Illinois; he was a Director of The Bishop’s Lodge in Santa Fe, New Mexico. He also served as a past Director of Advanced Foods Systems, a software company.  


Mr. Dembinski joined the Board of Directors of Junior Achievement of Arizona in 1985 and accepted a leadership role as Chair in 1989. Mr. Dembinski is currently Chairman of Junior Achievement of Arizona. Additionally, Mr. Dembinski is President of the Board of Trustees of the Junior Achievement Foundation. Mr. Dembinski has a B.S in Accounting from De Paul University in Chicago, Illinois and he received his Certified Public Accountant Certificate in 1970.


Our directors, executive officers, and significant employees are not currently being paid for their services. They will be compensated in the form of future interest.


Audit Committee Financial Expert

 

The functions of the Audit and Compensation Committee are: (i) to recommend the engagement of the Company's independent auditors and review with them the plan, scope and results of their audit for each year; (ii) to consider and review other matters relating to the financial and accounting affairs of the Company; and (iii) to review and recommend to the Board of Directors all compensation packages, including the number and terms of stock options, offered to officers and executive employees of the Company. The Company’s board director, Mr. Leo Dembinski serves as the Company's Audit Committee and Compensation Committee.


(c) Family Relationships


None.

 

(d) Involvement in Legal Proceedings

 

To the knowledge of the officers and directors of the Company, neither the Company nor any of its officers or directors is a party to any material legal proceeding or litigation and such persons know of no material legal proceeding or litigation contemplated or threatened. There are no judgments against the Company or its officers or directors. None of the officers or directors has been convicted of a felony or misdemeanor relating to securities or performance in corporate office.




 

ITEM 6. EXECUTIVE COMPENSATION.

 

 

EXECUTIVE COMPENSATION AND OTHER INFORMATION


Summary Compensation Table


The following summarizes the aggregate compensation paid during those fiscal years to our Executive Officers:

 

Name and Principal

 Position

Year

Annual Compensation

Long-term Compensation

All Other Compensation

Salary ($)

Bonus

Other Annual Compensation

Awards

Payouts

Restricted Stock Award(s)

Securities Underlying Options/SARs

LTIP Payouts

 

 

 

 

 

 

 

 

 

Keith Wong

President/CEO

2003

0

0

0

0

0

0

0

2004

0

0

0

0

0

0

0

2005

240,0001

0

0

0

0

0

0

 

 

 

 

 

 

 

 

 

 Norm Klein

2003

0

0

0

0

0

0

0

2004

0

0

0

0

0

0

0

2005

84,0002

0

0

0

0

0

0

 

 

 

 

 

 

 

 

 

 Leo Dembinski

2003

0

0

0

0

0

0

0

2004

0

0

0

0

0

0

0

2005

0

0

0

0

0

0

0

 

 

 

 

 

 

 

 

 


 

                                                

1The executive officers have not yet been compensated for their services, and their wages have been accrued.

2The executive officers have not yet been compensated for their services, and their wages have been accrued.


 

 

ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.


Norm Klein and Leo Dembinski are partners of High Performance Edge, LLC. along with two other partners. High Performance Edge, LLC. owns 13,166,720 shares of the Company's common stock.
 

 

ITEM 8. DESCRIPTION OF SECURITIES.


     The following statements do not purport to be complete and are qualified in their entirety by reference to the detailed provisions of the Company's Articles of Incorporation and Bylaws, copies of which are attached as exhibits to this document.


General


Our authorized capital consists of (1) 300,000,000 shares of common stock, par value $.000 per share, and (2) 100,000,000 shares of preferred stock, par value $.000 per share.


Common Stock

 

 The holders of our common stock are entitled to one vote per share on each matter submitted to a vote at a meeting of our stockholders, except to the extent that the voting rights of our shares of any class or series of stock are determined and specified as greater or lesser than one vote per share in the manner provided by our certificate of incorporation. Our stockholders have no pre-emptive rights to acquire additional shares of our common stock or other securities. Our common stock is not subject to redemption rights and carries no subscription or conversion rights. In the event of liquidation of our company, the shares of our common stock are entitled to share equally in corporate assets after satisfaction of all liabilities. As of October 30 , 2006 there were 98,339,392 shares of our common stock issued and outstanding, held by 1600 holders of record.

 

Preferred Stock


We may issue our preferred shares from time to time in one or more series as determined by our board of directors. The voting powers and preferences, the relative rights of each series, and the qualifications, limitations and restrictions thereof may be established by our board of directors without any further vote or action by our shareholders.  As of October 30 , 2006 there were 0 shares of our preferred stock issued and outstanding.


Outstanding Options and Warrants to Purchase Common Stock


As of October 30 , 2006 , there were no outstanding common share purchase options or warrants.

    



PART II


ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND OTHER SHAREHOLDER MATTERS.


There exists no market for our common stock.   Private sales or transfers are permitted under the respective state and Federal securities laws, subject to compliance with exemptions set forth under the respective statutory guidelines.  As of September 30, 2006, we had about 1600 shareholders of record.

 

Dividend Policy


Holders of the Company’s Common Stock are entitled to receive cash or stock dividends should they be declared by the Board of Directors, out of funds legally available for distribution.  Any such dividends may be paid in cash, property or shares of the Company’s or Company’s subsidiary’s common stock.  The Company has not paid any cash dividends since its inception, and it is not likely that cash dividends on its Common Stock will be declared at any time in the foreseeable future.  Any dividends will be subject to the discretion of the Company’s Board of Directors, and will depend upon, among other things, the operating and financial condition of the Company, its capital requirements and general business conditions.  Therefore, there can be no assurance that any dividends on the Company’s Common Stock will be paid in the future.

  

Shares Eligible for Future Sale


To date, there has been no market for our common stock. In the event a public market for our shares develops, future sales of substantial amounts of our common stock in the public market could adversely affect prevailing market prices from time to time. Further, since only a limited number of shares will be available for sale shortly after this offering because of certain contractual and legal restrictions on resale described below, sales of substantial amounts of our common stock in the public market after the restrictions lapse could adversely affect the prevailing market price and our ability to raise equity capital in the future.

 

Sales of Restricted Shares

As of September 30, 2006, we have issued and outstanding an aggregate of 98,339,392 shares of common stock.  

All these shares have already been outstanding for more than twelve months and are, pending satisfaction of certain pre-requisites, eligible for transfer under the auspices of  Rule 144.

Rule 144

Under Rule 144 as currently in effect, a stockholder who has beneficially owned restricted shares for at least one year and has complied with the requirements described below would be entitled to sell, upon the expiration of the lock-up agreements described below, some of that stockholder’s shares within any three-month period. That number of shares cannot exceed the greater of one percent of the number of shares of our common stock then outstanding, which will equal approximately 983,394 shares immediately after this offering Sales under Rule 144 are also restricted by manner of sale provisions, notice requirements and the availability of current public information about us. Rule 144 also provides that our affiliates who are selling shares of our common stock that are not restricted shares must nonetheless comply with the same restrictions applicable to restricted shares with the exception of the holding period requirement.

Under Rule 144(k), a person who is not deemed to have been one of our affiliates at any time during the 90 days preceding a sale and who has beneficially owned the shares proposed to be sold for at least two years is entitled to sell those shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144. Accordingly, these shares may be sold without restriction immediately upon the expiration of the lock-up agreements described below.

Rule 701

Rule 701 provides that the shares of common stock acquired upon the exercise of currently outstanding options or other rights granted under our equity plans may be resold, by persons, other than affiliates, restricted only by the manner of sale provisions of Rule 144, and by affiliates in accordance with Rule 144, without compliance with its one-year minimum holding period.

Lock-up Agreements


Each of the major shareholders, Keith Wong, High Performance Edge, LLC., Norm Klein, and Providential Holding, Inc. have agreed to limit the number of shares sold in their portfolio to a fixed percentage for the period of 12 months during the first year of operation.  

 

During the first year of operation, each partner will limit the number of shares sold in their portfolio to the following fixed percentage for each month. The number of shares that may be sold each month will be calculated by multiplying the maximum fixed percentage allowed for that month times the initial gross number of shares owned by each partner.

 

Month 1: 1.9%

Month 2 and 3: 2.5%

Month 4: 5.0%

Month 5 and 6: 7.0%

Months 7-12: 10.0%

 

During the second year of operation and beyond, there will be no restrictions. Further, there will be no restrictions at any time on the treasury shares which are needed for operating expenses.

 

(See Exhibit 4.1)



 

 

ITEM 2. LEGAL PROCEEDINGS.


To the knowledge of the officers and directors of the Company, neither the Company nor any of its officers or directors is a party to any material legal proceeding or litigation and such persons know of no material legal proceeding or litigation contemplated or threatened. There are no judgments against the Company or its officers or directors. None of the officers or directors has been convicted of a felony or misdemeanor relating to securities or performance in corporate office.

 


ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.              

                
None.

 


ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.


The following information is given with regard to unregistered securities sold during the preceding three years, to October 30, 2006, including the dates and amounts of securities sold, the persons to whom we sold the securities, the consideration received in connection with such sales and, if the securities were issued or sold other than for cash, the description of the transaction and the type and amount of consideration received.

 

    On September 12, 2002, ATC Technology Corporation (currently known as EastBridge Investment Group Corporation) was acquired by Providential Holdings, Inc. (Providential), and became its wholly-owned subsidiary. On November 17, 2003, Providential announced a stock dividend distribution to issue 20,000,081 of Providential's ATC stock to Providential's shareholders on record. At the time, there were about 1600 Providential shareholders. On July 27th, 2004, Providential declared the dividend distribution to Providential's shareholders. 

 

    On June 30, 2005, Providential Holdings, Inc., ATC Technology Corporation, Keith Wong, Norm Klein and High Performance Edge, LLC., agreed to a Re-organization and Exchange agreement, whereby PRVH transferred 70,000,000 of its 80,000,000 shares of ATC common stock to Keith Wong, Norm Klein, High Performance Edge, LLC, Ian Subel, Lynelle Berkeley, and Fogel International ("ATC Creditors") in exchange for the total debts currently owed to ATC creditors and leaving 10,000,000 shares held by Providential.                                                                                                                                                               


ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.


The Corporation Laws of the State of Arizona and the Company's Bylaws provide for indemnification of the Company's Directors for expenses actually and necessarily incurred by them in connection with the defense of any action, suit or proceeding in which they, or any of them, are made parties, or a party, by reason of having been Director(s) or Officer(s) of the corporation, or of such other corporation, except, in relation to matter as to which any such Director or Officer or former Director or Officer or person shall be adjudged in such action, suit or proceeding to be liable for negligence or misconduct in the performance of duty.  Furthermore, the personal liability of the Directors is limited as provided in the Company's Articles of Incorporation.


Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, the Company has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is therefore unenforceable.

 



 

PART F/S FINANCIAL.


 

EastBridge Investment Group Corporation

Financial Statements

 

Index to Financial Statements

Report of Independent Registered Public Accounting Firm  

Balance Sheets as of December 31, 2005 and 2004  

Statements of Deficit for the years ended December 31, 2005 and 2004

Statements of Earnings for the years ended December 31, 2005 and 2004

Statements of Cash Flows for the years ended December 31, 2005 and 2004

Notes to Financial Statements (December 31, 2005 and 2004)

Balance Sheets as of March 31, 2006 and June 30, 2006 - (unaudited)   

Statements of Earnings for the periods ended March 31, 2006 and June 30, 2006 - (unaudited)

Statements of Cash Flows for the years ended March 31, 2006 and June 30, 2006 - (unaudited)

Notes to Financial Statements (March 31, 2006 and June 30, 2006)

                                                                                                                                                  




JASPERS + HALL, PC
CERTIFIED PUBLIC ACCOUNTANTS
9175 Kenyon Avenue, Suite 100
Denver, CO 80237
303-796-0099




Report of Independent Registered Public Accounting Firm


To the Board of Directors and Stockholders of EastBridge Investment Group Corp


We have audited the accompanying balance sheets of EastBridge Investment Group Corp as of December 31, 2005 and 2004, and the related statements of operations, stockholders' deficit and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

 

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of EastBridge Investment Group Corp as of December 31, 2005 and 2004, and the related statements of operations, stockholders' deficit and cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States.

 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company's recurring losses from operations and its difficulties in generating sufficient cash flow to meet its obligations and sustain its operations raise substantial doubt about its ability to continue as a going concern. Management's plans concerning these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.


Jaspers + Hall, PC
Denver, Colorado
August 31, 2006

 

    




EASTBRIDGE INVESTMENT GROUP CORPORATION

 

Balance Sheet

Fiscal year ended December 31, 2004 and December 31, 2005

 

 

 

 

 

 

 

 

 

 

 As Of December 31,

 

 

 

2005

 

2004

 

ASSETS

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

                    $1,803

 

                $1,225

 

Accounts receivable

      -                            

 

              4,755

 

 

Total current assets

            1,803

 

           5,980

 

 

 

 

 

 

Deposits

            1,828

 

           1,582

 

 

 

 

 

 

 

 

Total assets

   $ 3,631

 

 $ 7,562

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

 

 


Current liabilities:

 

 

 

 

Accounts payable and accrued expenses

 $ 357,591

 

 $ 581,010

 

Due to officers

        247,823

 

       579,055

 

Due to related parties

                    -

 

    1,083,871

 

 

Total current liabilities

        605,414

 

    2,243,936

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders' equity (deficit):

 

 

 

 

Common stock, no par value; 300,000,000 shares authorized;

 

 

 

 

 

98,339,392 issued and outstanding

            1,325

 

           1,325

 

Additional paid-in-capital

     1,932,617

 

                   -

 

Accumulated deficit

    (2,535,725)

 

  (2,237,699)

 

 

Total stockholders' equity (deficit)

       (601,783)

 

  (2,236,374)

 

 

Total liabilities and stockholders' equity (deficit)

 $ 3,631

 

 $ 7,562

 

 

 

 

 

 

 

 

 

 

 

 

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





 


EASTBRIDGE INVESTMENT GROUP CORPORATION


Statement of Deficit

Fiscal year ended December 31, 2004 and December 31, 2005


 

 

 

 

 Additional

 

 Total

 

 

 Common Stock

 Paid-in

 Accumulated

 Stockholders'

 

 

 Shares

 Amount

 Capital

 Deficit

 Equity (Deficit)

 Balance at December 31, 2003

    98,339,392

 $ 1,325

 $     -

          $(2,131,651)

         $(2,130,326)

 

 

 

 

 

 

 

 Net loss for the year  

 

 

 

                  (106,048)

               (106,048)

 

 

 

 

 

 

 

 Balance at December 31, 2004

    98,339,392

           1,325

         -

      (2,237,699)

            (2,236,374)

 Debt waived by owners of the Company

 

 

      1,932,617

 

             1,932,617

 Net loss for the year  

 

 

 

         (298,026)

               (298,026)

 

 

 

 

 

 

 

 Balance at December 31, 2005

    98,339,392

 $ 1,325

 $1,932,617

    $(2,535,725)

 $ (601,783)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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




 

 

EASTBRIDGE INVESTMENT GROUP CORPORATION


Statement of Earnings

 Fiscal year ended December 31, 2004 and December 31, 2005

 

  

 

 

 

 For the Years

 

 

 

 Ended December 31,

 

 

 

2005

 

2004

From discontinued operations:

 

 

 

 Revenues from discontinued operations

 

 

 

 

 Sales

             15,904

 

          58,326

Cost of sales from discontinued operations

                    96

 

            1,366

Gross profit from discontinued operations

             15,808

 

          56,960

 

 

 

 

 

 

Expenses from discontinued operations:

 

 

 

 

Bad debt expense

               2,395

 

          14,431

 

Salaries and wages

           246,624

 

          82,828

 

Professional services

             10,415

 

            7,050

 

General and administrative

             45,318

 

        215,401

 

 

Total operating expenses

           304,752

 

        319,710

Loss from discontinued operations

            (288,944)

 

       (262,750)

 

 

 

 

 

 

Other income and (expenses)

 

 

 

 

Interest expense

            (37,275)

 

         (96,651)

 

Gain on debt settlement - net

             28,193

 

        253,353

 

 

Net other income and (expenses)

              (9,082)

 

        156,702

 

 

 

 

 

 

Net loss

       $(298,026)

 

 $(106,048)

 

 

 

 

 

 

Net income (loss) per share - basic and diluted:

 

 

 

 

Net loss

              $(0.00)

 

           $(0.00)

 

 

 

 

 

 

Weighted average number

 

 

 

 

of shares outstanding - basic and diluted

      98,339,392

 

   98,339,392

 

 

 

 

 

 

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






EASTBRIDGE INVESTMENT GROUP CORPORATION


Statement of Cash Flows

 Fiscal year ended December 31, 2004 and December 31, 2005


 

 

 

 

 For the Years Ended December 31,

 

 

 

 

2005

 

2004

 Cash flows from operating activities:

 

 

 

 

 

 Net loss from discontinued operations

 

       $   (298,026)

 

$   (106,048)

 

 Changes in operating assets and liabilities:

 

 

 

 

 

 

 (Increase) decrease in accounts receivable

 

                  4,755

 

          56,102

 

 

 (Increase) decrease in other assets and prepaid expenses

 

                   (246)

 

            1,565

 

 

 Increase (decrease) in accounts payable & acc exp

 

            (223,419)

 

       (254,843)

 

 Net cash used in operating activities

 

            (516,936)

 

       (303,224)

 Cash flows from financing activities:

 

 

 

 

 

 Advances from related parties

 

              517,514

 

        304,449

 

 Net cash provided by  financing activities

 

              517,514

 

        304,449

 Net increase (decrease) in cash

 

                     578

 

            1,225

 Cash and cash equivalents, beginning of period

 

                  1,225

 

                    -

 Cash and cash equivalents, end of period

 

 $               1,803

 

 $         1,225

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 


 


EASTBRIDGE INVESTMENT GROUP CORPORATION


EastBridge Investment Group Corporation

Notes to the Financial Statements

Dec 31, 2004 and Dec 31 2005


NOTE 1 - COMPANY OVERVIEW

 

EastBridge Investment Group Corporation (formally ATC Technology Corporation) (the "Company" or "EBIG") was incorporated in the state of Arizona on June 25, 2001.  The Company's principle activity up through June 30, 2005 was to manufacture mobile entertainment products, including VidegoTM, MoviegoTM and GamegoTM.  The VidegoTM and MoviegoTM are car theater systems available to consumers. The GamegoTM provides a means to play video game consoles made by Sony, Microsoft and Nintendo, in the car, RV, SUV, van or boat with attachable viewing monitors.   

 

On August 23, 2002, the Company entered into an agreement with Providential Holding, Inc. (PHI) to sell all the issued and outstanding shares of the Company.  For consideration,  PHI agreed to deliver $250,000 in promissory notes, non-interest bearing, payable 270 days after closing, and $250,000 in promissory notes, non-interest bearing, payable 180 days after closing, 3,000,000 shares of restricted stock of the Company with an option of additional shares to be issued after 270 days if the stock price does not reach $0.30, 1,000,000 shares of restricted stock of PHI with an option of additional shares to be issued after one year if the stock price does not reach $0.30. The transaction between the original stockholders and PHI was consummated as of October 17, 2003.  On June 30, 2005 the Company and PHI, agreed to financial and ownership restructuring and executed a formal agreement to return the majority ownership of the Company to its original stockholders in exchange for a forgiveness of notes and obligations owed to the Company and its original stockholders. The total amount of the debt forgiven is $1,932,617 and is recorded as paid-in capital by the major original stockholders in the 2005 financial statement. As a result of the re-structuring, PHI has become a minority stock holder and the original stockholders of the Company have become the majority stockholders as a group.  The newly structured Company decided to change its name to EastBridge Investment Group Corporation (EBIG) effective August 1, 2005 to more accurately reflect its new business focus on investment projects.

 

In 2005, EBIG decided to exit the mobile video game market and dedicate itself to providing investment related services in Asia, with a strong focus on the high GDP growth countries such as China and India. EBIG will initially concentrate on the growing investment opportunities in China (Hongkong, mainland, Macao and Taiwan).  Its products will be financial services that help small-to-medium-size companies obtain capital to grow their business.  EBIG's financial services will be in the form of Joint Ventures, Wholly Foreign Owned Enterprises, Guaranteed Return Ventures, investment banking, financial advisory services or any other financial services allowed by the local government and in compliance with the United States Securities Exchange Commission regulations. In addition, EBIG will also provide marketing, sales, and strategic planning services for its clients to assist them to enter the United States market.

EBIG is one of the very few US companies solely concentrated in marketing financial services to the small-size, but large number of Asian companies that need financial services to help them expand in their local markets. In the business sectors that EastBridge sees a unique opportunity, EastBridge will form its own foreign subsidiaries with local partners to capture the opportunity.



NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of estimates

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

 

Cash and cash equivalents

The Company considers all liquid debt instruments with an original maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

 

Deposit

As of December 31, 2005, the Company had a security deposit of $1,828.

 

Revenue recognition

The Company's revenue recognition policies are in compliance with Staff Accounting Bulletin (SAB) 104. Revenue is recognized when merchandise is shipped to a customer when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectibility is reasonably assured. Generally, the Company extends credit to its customers/clients and does not require collateral. The Company performs on-going credit evaluations of its customers/clients.  Any payments received before all of the relevant criteria for revenue recognition are recorded as unearned revenue.

 

Income taxes

Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income (loss). Valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.


Fair value of financial instruments

Statement of financial accounting standard No. 107, Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amount of all financial instruments at December 31, 2005 and 2004, which consist of various notes and loans payable, approximate their fair values. 

 

Net loss per share

The Company adopted the provisions of Statement of Financial Accounting Standards No. 128, Earnings per Share ("SFAS No. 128"). SFAS No. 128 eliminates the presentation of primary and fully diluted earnings per share ("EPS") and requires presentation of basic and diluted EPS. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period.  Diluted EPS is based on the weighted-average number of shares of common stock outstanding for the period and common stock equivalents outstanding at the end of the period.

 

Stock-based compensation

SFAS No. 123 prescribes accounting and reporting standards for all stock-based compensation plans, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. SFAS No. 123 requires compensation expense to be recorded (i) using the new fair value method or (ii) using the existing accounting rules prescribed by Accounting Principles Board Opinion No. 25, "Accounting for stock issued to employees?(APB 25) and related interpretations with proforma disclosure of what net income and earnings per share would have been had the Company adopted the new fair value method. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" and has adopted the disclosure only provisions of SFAS 123.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock.

The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Valuation of shares for services is based on the estimated fair market value of the services performed.

 

Segment Reporting

 

Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure About Segments of an Enterprise and Related Information" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. SFAS 131 has no effect on the Company's financial statements as substantially all of the Company's operations are conducted in one industry segment.

 

Advertising

The Company's policy is to expense advertising costs as incurred.  Advertising expenses for the year ended December 31, 2005 and 2004 were $207 and $87,297, respectively and are included in general and administrative expense.

 

Risks and Uncertainties

In the normal course of business, the Company is subject to certain risks and uncertainties. The Company provides its product on unsecured credit to most of its customers. Consequently, the Company's ability to collect the amounts due from customers is affected by economic fluctuations and each customer's ability to pay.



 

Accounting developments

In November 2004, the FASB has issued FASB Statement No. 151, "Inventory Costs, an Amendment of ARB No. 43, and Chapter 4" ("FAS No. 151").  The amendments made by FAS No. 151 are intended to improve financial reporting by clarifying that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and by requiring the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities.

The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005.  Earlier application is permitted for inventory costs incurred during fiscal years beginning after November 23, 2004.  The provisions of FAS No. 151 will be applied prospectively.  The Company does not expect the adoption of FAS No. 151 to have a material impact on its consolidated financial position, results of operations or cash flows.

In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123" ("FAS No. 123R").  FAS No. 123R requires companies to recognize in the statement of operations the grant- date fair value of stock options and other equity-based compensation issued to employees.  FAS No. 123R is effective beginning in the Company's first quarter of fiscal 2006.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In December 2004, the FASB issued SFAS Statement No. 153, "Exchanges of Nonmonetary Assets."  The Statement is an amendment of APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In March 2004, the Emerging Issues Task Force ("EITF") reached a consensus on Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments." The EITF reached a consensus about the criteria that should be used to determine when an investment is considered impaired, whether that impairment is other-than-temporary, and the measurement of an impairment loss and how that criteria should be applied to investments accounted for under SFAS No. 115, "ACCOUNTING IN CERTAIN INVESTMENTS IN DEBT AND EQUITY SECURITIES." EITF 03-01 also included accounting considerations subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. Additionally, EITF 03-01 includes new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the Financial Accounting Standards Board (FASB) delayed the accounting provisions of EITF 03-01; however the disclosure requirements remain effective for annual reports ending after June 15, 2004. The Company will evaluate the impact of EITF 03-01 once final guidance is issued.

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections". This statement applies to all voluntary changes in accounting principle and requires retrospective application to prior periods' financial statements of changes in accounting principle, unless this would be impracticable. This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error. This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this interpretation will have on its financial position, cash flows and results of operations.

In June 2005, the EITF reached consensus on Issue No.  05-6, Determining the Amortization Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance on determining the amortization period for leasehold improvements acquired in a business combination or acquired subsequent to lease inception. The guidance in EITF 05-6 will be applied prospectively and is effective for periods beginning after June 29, 2005.  EITF 05-6 is not expected to have a material effect on its consolidated financial position or results of operations.

In December 2004, the FASB issued FASB No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123."  FASB Statement No. 123R requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity-based  compensation issued to employees.  FASB No. 123R is effective beginning January 1, 2006.  FASB Statement No. 123R on is not expected to have a material effect on its consolidated financial position or results of operations.

 In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections." This statement applies to all voluntary changes in accounting principle and requires retrospective application to the prior periods' financial statements of changes in accounting principle, unless this retrospective application would be impracticable.  This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error.  This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this statement will have on its financial position, cash flows and results of operations.

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instrument - an amendment of FASB Statements No. 133 and 140." This Statement amends FASB Statements No. 133, "Accounting for Derivative Instruments and Hedging Activities," and No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities."  This Statement resolves issues addressed in FASB Statement No. 133 Implementation Issue No. D1, "Application of Statement 133 to Beneficial Interests in Securitized Financial Assets." The Company believes that the adoption of this standard will have no material impact on its consolidated financial statements.

In March 2006 FASB issued SFAS 156, "Accounting for Servicing of Financial Assets."  This Statement amends FASB Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities," with respect to the accounting for separately recognized servicing assets and servicing liabilities. This Statement:

1.

Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract.

2.

Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable.

3.

Permits an entity to choose 'Amortization method' or 'Fair value measurement method' for each class of separately recognized servicing assets and servicing liabilities.

4.

At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entity's exposure to changes in fair value of servicing assets or servicing liabilities that a server elects to subsequently measure at fair value.

5.

Requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the Balance Sheet and additional disclosures for all separately recognized servicing assets and servicing liabilities.

This Statement is effective as of the beginning of the Company's first fiscal year that begins after September 15, 2006. Management believes that this statement will not have a significant impact on the financial statements



NOTE 3 - DUE TO OFFICER

The Company received advances from officers of the Company amounting $247,823 and $579,055 as of December 31, 2005 and 2004, respectively. The interest rates on these advances vary from 5% - 36% per year, are unsecured and due on demand. The interest on these advances for the years ended December 31, 2005 and 2004 amounted to $12,136 and $45,540, respectively.  These amounts have been accrued and are included in due to officers. 

 

NOTE 4 - DUE TO RELATED PARTIES

The Company received advances from a related party (HPE) amounting to $250,000 as of June 30, 2004. The advance carries an interest rate of 20% per year, is unsecured and due on demand.  The company also received advances from PHI (see note 1) amounting to $662,056 as of June 30, 2004.  This advance was unsecured and interest free.

The interest on these advances for the years ended December 31, 2005 and 2004 amounted to $25,139 and $51,111, respectively.  These amounts have been accrued and are included in due to related parties. 

These advances and accrued interest have been written off as part of the Company's reorganization plan as of June 30, 2005. (see Note 6)

 

NOTE 5 - DISCONTINUED OPERATIONS

On June 30, 2005, the Company decided to exit the mobile video game market and dedicate itself to providing investment related services in Asia.  The revenues, costs, and expenses directly associated with this discontinued business have been classified as discontinued operations on the income statement.  Corporate expenses such as interest expense have not been allocated to discontinued operations.  Revenue recorded within loss from operations of discontinued business was $15,904 in 2005.  The total loss from discontinued operations for 2005 was $288,943.

 

NOTE 6 - RESTRUCTURING

On June 30, 2005 the Company and PHI, agreed to financial and ownership restructuring and executed a formal agreement to return the majority ownership of the Company to its original stockholders in exchange for a forgiveness of advances and obligations owed to the Company and its original stockholders.  As a result of the re-structuring, $277,402 of accounts payable, $708,252 of advances due to officers, and $975,156 of advances due to related parties were forgiven with a resulting offset to Additional Paid in Capital.  As part of the restructure, some of the accounts were settled for less than the amount owed and were paid by PHI.  The settlement resulted in a $28,193 gain and is reflected in the Income Statement under Gain on Settlement of Debts.

 

NOTE 7 - INCOME TAXES

No provision was made for income taxes since the Company has significant net operating loss carryforwards. At June 30, 2005 and 2004, the Company has a net operating loss carryforward for federal tax purposes approximately of $2,007,000 and $1,360,000, respectively. Differences between financial statement and tax losses consist primarily of amortization allowance were immaterial at December 31, 2005 and 2004. The net operating loss carryforwards may be used to reduce taxable income through the year 2023. The availability of the Company's net operating loss carryforwards are subject to limitation if there is a 50% or more positive change in the ownership of the Company's stock.

The Company has deferred tax assets of $803,000 and $544,000 approximately at December 31, 2005 and 2004 relating to its net operating losses. A valuation allowance is provided for deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company provided a 100% valuation allowance for these deferred tax assets.

 

NOTE 8 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of business. Through December 31, 2005, the Company had incurred cumulative losses of $2,535,724 which includes the loss of $298,025 and income of $74,602 for the periods ended December 31, 2005 and 2004, respectively and negative working capital of $603,610 and $2,237,656 as of December 31, 2005 and 2004, respectively.

Management plans to take the following steps that it believes will be sufficient to provide the Company with the ability to continue in existence. (i) Management intends to continue to raise additional financing through private equity or debt financing to pay down Company debt and/or reduce the cost of debt service. (ii) Management is also planning to gain access to public capital markets. In this regard, the Company and the Company's major stakeholders entered into an agreement with Providential Holding, Inc. (PHI) to cancel the major notes and debts in exchange for most of the issued and outstanding shares of the Company through management restructuring see (note1).  (iii) Management intends to increase revenues and is actively pursuing additional contracts in several markets overseas. 


 NOTE 9 - EQUITY TRANSACTIONS

The Company has 300,000,000 shares of common stock authorized with no par value, 93,339,392 were outstanding during 2004 and 2005. During 2004 and 2005 there were no additional shares issued, however as a result of the restructuring, $1,932,617 was transferred from debt to additional paid in capital.

 



EASTBRIDGE INVESTMENT GROUP CORPORATION


Balance Sheet

Periods Ended March 31, 2006 and June 30, 2006

(Unaudited)


 

 

 

 For the Year

 

 For the Period

 

 

 

 For the Period

 

 

 

 

 

 Ended December 31,

 

Ended March 31,

 

 CF change

 

Ended June 30,

 

 CF change

 

 

 

2005

 

2006

 

 1st Q 06

 

2006

 

 2nd Q 06

 

ASSETS

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 $ 1,803

 

 $ 2,751

 

           (947)

 

 $ 2,741

 

           (938)

 

 

Total current assets

                          1,803

 

                  2,751

 

 

 

                  2,741

 

 

 

 

 

 

 

 

 

               -   

 

 

 

 

Deposits

                          1,828

 

                  1,828

 

               -   

 

                  1,828

 

               -   

 

 

 

 

 

 

 

               -   

 

 

 

 

 

 

Total assets

 $ 3,632

 

 $ 4,579

 

 

 

 $ 4,569

 

 

 

 

 

 

 

 

 

               -   

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

               -   

 

 

 

 

Current liabilities:

 

 

 

 

               -   

 

 

 

 

 

Accounts payable and accrued expenses

 $ 338,291

 

 $ 347,478

 

        (9,188)

 

 $ 356,666

 

      (18,375)

 

Due to officers

                      247,823

 

              309,073

 

      (61,250)

 

              379,023

 

    (131,200)

 

Other current liabilities

                        19,300

 

                19,300

 

               -   

 

                19,300

 

               -   

 

 

Total current liabilities

                      605,413

 

              675,851

 

 

 

              754,988

 

 

 

 

 

 

 

 

 

               -   

 

 

 

 

Contingencies

                                  -

 

                          -

 

               -   

 

                          -

 

 

 

 

 

 

 

 

 

               -   

 

 

 

 


Stockholders' equity:

 

 

 

 

               -   

 

 

 

 

 

Common stock, no par value; 300,000,000 shares authorized;

 

 

 

 

               -   

 

 

 

 

 

 

98,339,392 issued and outstanding

                          1,325

 

                  1,325

 

               -   

 

                  1,325

 

               -   

 

Additional paid-in-capital

                   1,932,617

 

           1,932,617

 

               -   

 

           1,932,617

 

               -   

 

Accumulated deficit

                  (2,535,724)

 

         (2,605,214)

 

        69,490

 

         (2,684,361)

 

      148,637

 

 

Total stockholders' equity

                     (601,782)

 

            (671,272)

 

 

 

            (750,419)

 

 

 

 

Total liabilities and stockholders' equity

 $ 3,632

 

 $ 4,579

 

 

 

 $ 4,569

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

            (673,100)

workg cap

 

            (752,247)

workg cap





EASTBRIDGE INVESTMENT GROUP CORPORATION


Statement of Earnings

Periods Ended March 31, 2006 and June 30, 2006

(Unaudited)


 

 

 

 For the 3 mos

 

 For the 6 mos





 

 

 

 Ended March 31,

 

 Ended June 30,

 

 

 

2006

 

2006

From discontinued operations:

 

 

 

 Revenues from discontinued operations

 

 

 

 

 Sales

                     5,370

 

                 5,370

Cost of sales from discontinued operations

                             -

 

                    968

Gross profit from discontinued operations

                     5,370

 

                 4,402

 

 

 

 

 

 

Expenses from discontinued operations:

 

 

 

 

Salaries and wages

                   70,438

 

             140,875

 

Professional services

                     1,232

 

                 6,115

 

General and administrative

                     3,191

 

                 6,049

 

 

Total operating expenses

                   74,860

 

             153,039

Loss from discontinued operations

                 (69,490)

 

            (148,637)

 

 

 

 

 

 

Net loss

 $ (69,490)

 

 $ (148,637)

 

 

 

 

 

 

Net income (loss) per share - basic and diluted:

 

 

 

 

Net loss

 $ (0.00)

 

 $ (0.00)

 

 

 

 

 

 

Weighted average number

 

 

 

 

of shares outstanding - basic and diluted

            98,339,392

 

        98,339,392


 





EASTBRIDGE INVESTMENT GROUP CORPORATION


Statement of Cash Flows

Periods Ended March 31, 2006 and June 30, 2006

(Unaudited)

 

 

 

 

 3 months

 

      6 months

 

 

 

 

March 31,

 

        June 30,

 

 

 

 

2006

 

          2006

 Cash flows from operating activities:

 

 

 

 

 

 Net loss from continuing operations

 

 $ (69,490)

 

             $(148,637)

 

 Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

 

 Increase in accounts payable & acc exp

 

            9,188

 

          18,375

 

 

 

 

 

 

 Increase in due to officers

 

          61,250

 

        131,200

 

 

 

 

 

 Net cash used in operating activities

 

               947

 

               938

 

 

 

 

 Net increase (decrease) in cash

 

               947

 

               938

 

 

 

 

 Cash and cash equivalents, beginning of period

 

            1,803

 

            1,803

 

 

 

 

 Cash and cash equivalents, end of period

 

 $ 2,751

 

 $ 2,741

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash per TB:

            2,751

 

            2,741

 

 

 

 

 

 

 

 diff:

              0.00

 

                  (0)

 

 

 

 





EASTBRIDGE INVESTMENT GROUP CORPORATION


Note of Financial Statements (March 31, 2006)


NOTE 1 - COMPANY OVERVIEW

 

EastBridge Investment Group Corporation (formally ATC Technology Corporation) (the "Company" or "EBIG) was incorporated in the state of Arizona on June 25, 2001.  The Company's principle activity up through June 30, 2005 was to manufacture mobile entertainment products, including VidegoTM, MoviegoTM and GamegoTM.  The VidegoTM and MoviegoTM are car theater systems available to consumers. The GamegoTM provides a means to play video game consoles made by Sony, Microsoft and Nintendo, in the car, RV, SUV, van or boat with attachable viewing monitors.  

On August 23, 2002, the Company entered into an agreement with Providential Holding, Inc. (PHI) to sell all the issued and outstanding shares of the Company.  For consideration,  PHI agreed to deliver $250,000 in promissory notes, non-interest bearing, payable 270 days after closing, and $250,000 in promissory notes, non-interest bearing, payable 180 days after closing, 3,000,000 shares of restricted stock of the Company with an option of additional shares to be issued after 270 days if the stock price does not reach $0.30, 1,000,000 shares of restricted stock of PHI with an option of additional shares to be issued after one year if the stock price does not reach $0.30. The transaction between the original stockholders and PHI was consummated as of October 17, 2003.  On June 30, 2005 the Company and PHI, agreed to financial and ownership restructuring and executed a formal agreement to return the majority ownership of the Company to its original stockholders in exchange for a forgiveness of notes and obligations owed to the Company and its original stockholders. The total amount of the debt forgiven is $1,932,617 and is recorded as paid-in capital by the major original stockholders in the 2005 financial statement. As a result of the re-structuring, PHI has become a minority stock holder and the original stockholders of the Company have become the majority stockholders as a group.  The newly structured Company decided to change its name to EastBridge Investment Group Corporation (EBIG) effective August 1, 2005 to more accurately reflect its new business focus on investment projects.

In 2005, EBIG decided to exit the mobile video game market and dedicate itself to providing investment related services in Asia, with a strong focus on the high GDP growth countries such as China and India. EBIG will initially concentrate on the growing investment opportunities in China (Hongkong, mainland, Macao and Taiwan).  Its products will be financial services that help small-to-medium-size companies obtain capital to grow their business.  EBIG's financial services will be in the form of Joint Ventures, Wholly Foreign Owned Enterprises, Guaranteed Return Ventures, investment banking, financial advisory services or any other financial services allowed by the local government and in compliance with the United States Securities Exchange Commission regulations. In addition, EBIG will also provide marketing, sales, and strategic planning services for its clients to assist them to enter the United States market.

EBIG is one of the very few US companies solely concentrated in marketing financial services to the small-size, but large number of Asian companies that need financial services to help them expand in their local markets. In the business sectors that EastBridge sees a unique opportunity, EastBridge will form its own foreign subsidiaries with local partners to capture the opportunity.




NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of estimates

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

 

Cash and cash equivalents

The Company considers all liquid debt instruments with an original maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents. 

 

Deposit

As of March 31, 2006, the Company had a security deposit of $1,828.

 

Revenue recognition

The Company's revenue recognition policies are in compliance with Staff Accounting Bulletin (SAB) 104. Revenue is recognized when merchandise is shipped to a customer when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectibility is reasonably assured. Generally, the Company extends credit to its customers/clients and does not require collateral. The Company performs on-going credit evaluations of its customers/clients.  Any payments received before all of the relevant criteria for revenue recognition are recorded as unearned revenue.

 

Income taxes

Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income (loss). Valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.

 

Fair value of financial instruments

Statement of financial accounting standard No. 107, Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amount of all financial instruments at December 31, 2005 and 2004, which consist of various notes and loans payable, approximate their fair values.

 

Net loss per share 

The Company adopted the provisions of Statement of Financial Accounting Standards No. 128, Earnings per Share ("SFAS No. 128"). SFAS No. 128 eliminates the presentation of primary and fully diluted earnings per share ("EPS") and requires presentation of basic and diluted EPS. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period.  Diluted EPS is based on the weighted-average number of shares of common stock outstanding for the period and common stock equivalents outstanding at the end of the period.


Stock-based compensation

SFAS No. 123 prescribes accounting and reporting standards for all stock-based compensation plans, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. SFAS No. 123 requires compensation expense to be recorded (i) using the new fair value method or (ii) using the existing accounting rules prescribed by Accounting Principles Board Opinion No. 25, "Accounting for stock issued to employees" (APB 25) and related interpretations with proforma disclosure of what net income and earnings per share would have been had the Company adopted the new fair value method. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" and has adopted the disclosure only provisions of SFAS 123.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock.


The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Valuation of shares for services is based on the estimated fair market value of the services performed.

 

Segment Reporting

 

Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure About Segments of an Enterprise and Related Information" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. SFAS 131 has no effect on the Company's financial statements as substantially all of the Company's operations are conducted in one industry segment.

 

Advertising

The Company's policy is to expense advertising costs as incurred.  No advertising was expensed during the first quarter of 2006.

 

Risks and Uncertainties

In the normal course of business, the Company is subject to certain risks and uncertainties. The Company provides its product on unsecured credit to most of its customers. Consequently, the Company's ability to collect the amounts due from customers is affected by economic fluctuations and each customer's ability to pay.



Accounting developments

In November 2004, the FASB has issued FASB Statement No. 151, "Inventory Costs, an Amendment of ARB No. 43, and Chapter 4" ("FAS No. 151").  The amendments made by FAS No. 151 are intended to improve financial reporting by clarifying that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and by requiring the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities.

The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005.  Earlier application is permitted for inventory costs incurred during fiscal years beginning after November 23, 2004.  The provisions of FAS No. 151 will be applied prospectively.  The Company does not expect the adoption of FAS No. 151 to have a material impact on its consolidated financial position, results of operations or cash flows.

In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123" ("FAS No. 123R").  FAS No. 123R requires companies to recognize in the statement of operations the grant- date fair value of stock options and other equity-based compensation issued to employees.  FAS No. 123R is effective beginning in the Company's first quarter of fiscal 2006.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In December 2004, the FASB issued SFAS Statement No. 153, "Exchanges of Nonmonetary Assets."  The Statement is an amendment of APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In March 2004, the Emerging Issues Task Force ("EITF") reached a consensus on Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments." The EITF reached a consensus about the criteria that should be used to determine when an investment is considered impaired, whether that impairment is other-than-temporary, and the measurement of an impairment loss and how that criteria should be applied to investments accounted for under SFAS No. 115, "ACCOUNTING IN CERTAIN INVESTMENTS IN DEBT AND EQUITY SECURITIES." EITF 03-01 also included accounting considerations subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. Additionally, EITF 03-01 includes new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the Financial Accounting Standards Board (FASB) delayed the accounting provisions of EITF 03-01; however the disclosure requirements remain effective for annual reports ending after June 15, 2004. The Company will evaluate the impact of EITF 03-01 once final guidance is issued.

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections." This statement applies to all voluntary changes in accounting principle and requires retrospective application to prior periods' financial statements of changes in accounting principle, unless this would be impracticable. This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error. This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this interpretation will have on its financial position, cash flows and results of operations.


In June 2005, the EITF reached consensus on Issue No.  05-6, Determining the Amortization Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance on determining the amortization period for leasehold improvements acquired in a business combination or acquired subsequent to lease inception. The guidance in EITF 05-6 will be applied prospectively and is effective for periods beginning after June 29, 2005.  EITF 05-6 is not expected to have a material effect on its consolidated financial position or results of operations.

In December 2004, the FASB issued FASB No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123."  FASB Statement No. 123R requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity-based  compensation issued to employees.  FASB No. 123R is effective beginning January 1, 2006.  FASB Statement No. 123R on is not expected to have a material effect on its consolidated financial position or results of operations.

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections."  This statement applies to all voluntary changes in accounting principle and requires retrospective application to the prior periods' financial statements of changes in accounting principle, unless this retrospective application would be impracticable.  This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error.  This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this statement will have on its financial position, cash flows and results of operations.

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments - an amendment of FASB Statements No. 133 and 140." This Statement amends FASB Statements No. 133, "Accounting for Derivative Instruments and Hedging Activities," and No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities."  This Statement resolves issues addressed in FASB Statement No. 133 Implementation Issue No. D1, "Application of Statement 133 to Beneficial Interests in Securitized Financial Assets." The Company believes that the adoption of this standard will have no material impact on its consolidated financial statements.

In March 2006 FASB issued SFAS 156, "Accounting for Servicing of Financial Assets." This Statement amends FASB Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities," with respect to the accounting for separately recognized servicing assets and servicing liabilities. This Statement:

1.

Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract.

2.

Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable.

3.

Permits an entity to choose 'Amortization method' or  'Fair value measurement method' for each class of separately recognized servicing assets and servicing liabilities.

4.

At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entity's exposure to changes in fair value of servicing assets or servicing liabilities that a servicer elects to subsequently measure at fair value.

5.

Requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the Balance Sheet and additional disclosures for all separately recognized servicing assets and servicing liabilities.

This Statement is effective as of the beginning of the Company's first fiscal year that begins after September 15, 2006. Management believes that this statement will not have a significant impact on the financial statements



NOTE 3 - DUE TO OFFICERS

The Company received advances from officers of the Company amounting to $309,073 as of March 31, 2006.  These amounts include $61,250 of accrued wages for the first quarter of 2006.  These advances are interest free and payable on demand.

 

NOTE 4 - OTHER CURRENT LIABILITES

As of March 31, 2006, the Company recorded $19,300 as a payable for a lease at a previous location.  Since the liability is for a previous obligation and could be called at any time, it has been classified under other current liabilities.

 

NOTE 5 - DISCONTINUED OPERATIONS

On June 30, 2005, the Company decided to exit the mobile video game market and enter the more profitable world of investment related services in the Far East countries.  The revenues, costs, and expenses directly associated with this business have been classified as discontinued operations on the income statement.  Corporate expenses such as interest expense have not been allocated to discontinued operations.  Revenue recorded within loss from operations of discontinued business was $5,370 as of March 31, 2006.  The total loss from discontinued operations as of March 31, 2006 was $69,490.


NOTE 6 - INCOME TAXES

No provision was made for income taxes since the Company has significant net operating loss carryforwards. At March 31, 2006, the Company has a net operating loss carryforward for federal tax purposes approximately of $2,007,000. Differences between financial statement and tax losses consist primarily of amortization allowance were immaterial at March 31, 2006 The net operating loss carryforwards may be used to reduce taxable income through the year 2023. The availability of the Company's net operating loss carryforwards are subject to limitation if there is a 50% or more positive change in the ownership of the Company's stock.

The Company has deferred tax assets of approximately $803,000 at March 31, 2006 relating to its net operating losses. A valuation allowance is provided for deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company provided a 100% valuation allowance for these deferred tax assets.

 

NOTE 7 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of business. Through March 31, 2006, the Company had incurred cumulative losses of $2,605,214 which includes the loss of $69,490 for the period ended March 31, 2006 and negative working capital of $673,100 as of March 31, 2006.

Management plans to take the following steps that it believes will be sufficient to provide the Company with the ability to continue in existence. (i) Management intends to continue to raise additional financing through private equity or debt financing to pay down Company debt and/or reduce the cost of debt service. (ii) Management is also planning to gain access to public capital markets. In this regard, the Company and the Company's major stakeholders entered into an agreement with Providential Holding, Inc. (PHI) to cancel the major notes and debts in exchange for most of the issued and outstanding shares of the Company through management restructuring see (note1).  (iii) Management intends to increase revenues and is actively pursuing additional contracts in several markets overseas. 




 

EASTBRIDGE INVESTMENT GROUP CORPORATION


Note of Financial Statements (June 30, 2006)


 

NOTE 1 - COMPANY OVERVIEW

 

EastBridge Investment Group Corporation (formally ATC Technology Corporation) (the "Company" or "EBIG? was incorporated in the state of Arizona on June 25, 2001.  The Company's principle activity up through June 30, 2005 was to manufacture mobile entertainment products, including VidegoTM, MoviegoTM and GamegoTM.  The VidegoTM and MoviegoTM are car theater systems available to consumers. The GamegoTM provides a means to play video game consoles made by Sony, Microsoft and Nintendo, in the car, RV, SUV, van or boat with attachable viewing monitors.  

 

On August 23, 2002, the Company entered into an agreement with Providential Holding, Inc. (PHI) to sell all the issued and outstanding shares of the Company.  For consideration,  PHI agreed to deliver $250,000 in promissory notes, non-interest bearing, payable 270 days after closing, and $250,000 in promissory notes, non-interest bearing, payable 180 days after closing, 3,000,000 shares of restricted stock of the Company with an option of additional shares to be issued after 270 days if the stock price does not reach $0.30, 1,000,000 shares of restricted stock of PHI with an option of additional shares to be issued after one year if the stock price does not reach $0.30. The transaction between the original stockholders and PHI was consummated as of October 17, 2003.  On June 30, 2005 the Company and PHI, agreed to financial and ownership restructuring and executed a formal agreement to return the majority ownership of the Company to its original stockholders in exchange for a forgiveness of notes and obligations owed to the Company and its original stockholders. The total amount of the debt forgiven is $1,932,617 and is recorded as paid-in capital by the major original stockholders in the 2005 financial statement. As a result of the re-structuring, PHI has become a minority stock holder and the original stockholders of the Company have become the majority stockholders as a group.  The newly structured Company decided to change its name to EastBridge Investment Group Corporation (EBIG) effective August 1, 2005 to more accurately reflect its new business focus on investment projects.

 

In 2005, EBIG decided to exit the mobile video game market and dedicate itself to providing investment related services in Asia, with a strong focus on the high GDP growth countries such as China and India. EBIG will initially concentrate on the growing investment opportunities in China (Hongkong, mainland, Macao and Taiwan).  Its products will be financial services that help small-to-medium-size companies obtain capital to grow their business.  EBIG's financial services will be in the form of Joint Ventures, Wholly Foreign Owned Enterprises, Guaranteed Return Ventures, investment banking, financial advisory services or any other financial services allowed by the local government and in compliance with the United States Securities Exchange Commission regulations. In addition, EBIG will also provide marketing, sales, and strategic planning services for its clients to assist them to enter the United States market. 


EBIG is one of the very few US companies solely concentrated in marketing financial services to the small-size, but large number of Asian companies that need financial services to help them expand in their local markets. In the business sectors that EastBridge sees a unique opportunity, EastBridge will form its own foreign subsidiaries with local partners to capture the opportunity.



NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Use of estimates 

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

 

Cash and cash equivalents

The Company considers all liquid debt instruments with an original maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

 

Deposit

As of June 30, 2006, the Company had a security deposit of $1,828.

 

Revenue recognition

The Company's revenue recognition policies are in compliance with Staff Accounting Bulletin (SAB) 104. Revenue is recognized when merchandise is shipped to a customer when a formal arrangement exists, the price is fixed or determinable, the delivery is completed, no other significant obligations of the Company exist and collectibility is reasonably assured. Generally, the Company extends credit to its customers/clients and does not require collateral. The Company performs on-going credit evaluations of its customers/clients.  Any payments received before all of the relevant criteria for revenue recognition are recorded as unearned revenue.

 

Income taxes

Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted laws and rates applicable to the periods in which the differences are expected to affect taxable income (loss). Valuation allowance is established when necessary to reduce deferred tax assets to the amount expected to be realized.

 

Fair value of financial instruments

Statement of financial accounting standard No. 107, Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amount of all financial instruments at December 31, 2005 and 2004, which consist of various notes and loans payable, approximate their fair values.

 

Net loss per share

The Company adopted the provisions of Statement of Financial Accounting Standards No. 128, Earnings per Share ("SFAS No. 128"). SFAS No. 128 eliminates the presentation of primary and fully diluted earnings per share ("EPS") and requires presentation of basic and diluted EPS. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted-average number of common shares outstanding for the period.  Diluted EPS is based on the weighted-average number of shares of common stock outstanding for the period and common stock equivalents outstanding at the end of the period.


Stock-based compensation

SFAS No. 123 prescribes accounting and reporting standards for all stock-based compensation plans, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. SFAS No. 123 requires compensation expense to be recorded (i) using the new fair value method or (ii) using the existing accounting rules prescribed by Accounting Principles Board Opinion No. 25, “Accounting for stock issued to employees?(APB 25) and related interpretations with proforma disclosure of what net income and earnings per share would have been had the Company adopted the new fair value method. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" and has adopted the disclosure only provisions of SFAS 123.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock. The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of SFAS 123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"), "Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Valuation of shares for services is based on the estimated fair market value of the services performed.


Segment Reporting 

Statement of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure About Segments of an Enterprise and Related Information" requires use of the "management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. SFAS 131 has no effect on the Company's financial statements as substantially all of the Company's operations are conducted in one industry segment.

 

Advertising

The Company's policy is to expense advertising costs as incurred.  No advertising was expensed during the second quarter of 2006.

 

Risks and Uncertainties

In the normal course of business, the Company is subject to certain risks and uncertainties. The Company provides its product on unsecured credit to most of its customers. Consequently, the Company's ability to collect the amounts due from customers is affected by economic fluctuations and each customer's ability to pay.


 

Accounting developments  

In November 2004, the FASB has issued FASB Statement No. 151, "Inventory Costs, an Amendment of ARB No. 43, and Chapter 4" ("FAS No. 151").  The amendments made by FAS No. 151 are intended to improve financial reporting by clarifying that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges and by requiring the allocation of fixed production overheads to inventory based on the normal capacity of the production facilities.

The guidance is effective for inventory costs incurred during fiscal years beginning after June 15, 2005.  Earlier application is permitted for inventory costs incurred during fiscal years beginning after November 23, 2004.  The provisions of FAS No. 151 will be applied prospectively.  The Company does not expect the adoption of FAS No. 151 to have a material impact on its consolidated financial position, results of operations or cash flows.

In December 2004, the FASB issued FASB Statement No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123" ("FAS No. 123R").  FAS No. 123R requires companies to recognize in the statement of operations the grant- date fair value of stock options and other equity-based compensation issued to employees.  FAS No. 123R is effective beginning in the Company's first quarter of fiscal 2006.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In December 2004, the FASB issued SFAS Statement No. 153, "Exchanges of Nonmonetary Assets."  The Statement is an amendment of APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance.  The Company believes that the adoption of this standard will have no material impact on its financial statements.

In March 2004, the Emerging Issues Task Force ("EITF") reached a consensus on Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments." The EITF reached a consensus about the criteria that should be used to determine when an investment is considered impaired, whether that impairment is other-than-temporary, and the measurement of an impairment loss and how that criteria should be applied to investments accounted for under SFAS No. 115, "ACCOUNTING IN CERTAIN INVESTMENTS IN DEBT AND EQUITY SECURITIES." EITF 03-01 also included accounting considerations subsequent to the recognition of an other-than-temporary impairment and requires certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments. Additionally, EITF 03-01 includes new disclosure requirements for investments that are deemed to be temporarily impaired. In September 2004, the Financial Accounting Standards Board (FASB) delayed the accounting provisions of EITF 03-01; however the disclosure requirements remain effective for annual reports ending after June 15, 2004. The Company will evaluate the impact of EITF 03-01 once final guidance is issued.

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections." This statement applies to all voluntary changes in accounting principle and requires retrospective application to prior periods' financial statements of changes in accounting principle, unless this would be impracticable. This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error. This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this interpretation will have on its financial position, cash flows and results of operations.

In June 2005, the EITF reached consensus on Issue No.  05-6, Determining the Amortization Period for Leasehold Improvements ("EITF 05-6.") EITF 05-6 provides guidance on determining the amortization period for leasehold improvements acquired in a business combination or acquired subsequent to lease inception. The guidance in EITF 05-6 will be applied prospectively and is effective for periods beginning after June 29, 2005.  EITF 05-6 is not expected to have a material effect on its consolidated financial position or results of operations.

In December 2004, the FASB issued FASB No. 123R, "Share-Based Payment, an Amendment of FASB Statement No. 123."  FASB Statement No. 123R requires companies to recognize in the statement of operations the grant-date fair value of stock options and other equity-based  compensation issued to employees.  FASB No. 123R is effective beginning January 1, 2006.  FASB Statement No. 123R on is not expected to have a material effect on its consolidated financial position or results of operations.

In May 2005, the FASB issued SFAS No. 154, "Accounting Changes and Error Corrections." This statement applies to all voluntary changes in accounting principle and requires retrospective application to the prior periods?financial statements of changes in accounting principle, unless this retrospective application would be impracticable.  This statement also makes a distinction between "retrospective application" of an accounting principle and the "restatement" of financial statements to reflect the correction of an error.  This statement is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. The Company is evaluating the effect the adoption of this statement will have on its financial position, cash flows and results of operations.

In February 2006, the FASB issued SFAS No. 155, "Accounting for Certain Hybrid Financial Instruments - an amendment of FASB Statements No. 133 and 140."  This Statement amends FASB Statements No. 133, "Accounting for Derivative Instruments and Hedging Activities," and No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities." This Statement resolves issues addressed in FASB Statement No. 133 Implementation Issue No. D1, "Application of Statement 133 to Beneficial Interests in Securitized Financial Assets." The Company believes that the adoption of this standard will have no material impact on its consolidated financial statements.

In March 2006 FASB issued SFAS 156, "Accounting for Servicing of Financial Assets." This Statement amends FASB Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities," with respect to the accounting for separately recognized servicing assets and servicing liabilities. This Statement:

1.

Requires an entity to recognize a servicing asset or servicing liability each time it undertakes an obligation to service a financial asset by entering into a servicing contract.

2.

Requires all separately recognized servicing assets and servicing liabilities to be initially measured at fair value, if practicable.

3.

Permits an entity to choose 'Amortization method' or 'Fair value measurement method' for each class of separately recognized servicing assets and servicing liabilities.

4.

At its initial adoption, permits a one-time reclassification of available-for-sale securities to trading securities by entities with recognized servicing rights, without calling into question the treatment of other available-for-sale securities under Statement 115, provided that the available-for-sale securities are identified in some manner as offsetting the entity's exposure to changes in fair value of servicing assets or servicing liabilities that a servicer elects to subsequently measure at fair value.

5.

Requires separate presentation of servicing assets and servicing liabilities subsequently measured at fair value in the Balance Sheet and additional disclosures for all separately recognized servicing assets and servicing liabilities.

This Statement is effective as of the beginning of the Company's first fiscal year that begins after September 15, 2006. Management believes that this statement will not have a significant impact on the financial statements.


 

NOTE 3 - DUE TO OFFICERS

The Company received advances from officers of the Company amounting to $379,023 as of June 30, 2006.  These amounts include $122,500 of accrued wages for the first two quarters of 2006.  These advances are interest free and payable on demand.

 

NOTE 4 - OTHER CURRENT LIABILITES

As of June 30, 2006, the Company recorded $19,300 as a payable for a lease at a previous location.  Since the liability is for a previous obligation and could be called at any time, it has been classified under other current liabilities.

 

NOTE 5 - DISCONTINUED OPERATIONS

On June 30, 2005, the Company decided to exit the mobile video game market and enter the more profitable world of investment related services in the Far East countries.  The revenues, costs, and expenses directly associated with this business have been classified as discontinued operations on the income statement.  Corporate expenses such as interest expense have not been allocated to discontinued operations.  Revenue recorded within loss from operations of discontinued business was $5,370 in 2006.  The total loss from discontinued operations as of June 30, 2006 was $148,637.

 

NOTE 6 - INCOME TAXES

No provision was made for income taxes since the Company has significant net operating loss carryforwards. At June 30, 2006, the Company has a net operating loss carryforward for federal tax purposes approximately of $2,007,000. Differences between financial statement and tax losses consist primarily of amortization allowance were immaterial at June 30, 2006 The net operating loss carryforwards may be used to reduce taxable income through the year 2023. The availability of the Company's net operating loss carryforwards are subject to limitation if there is a 50% or more positive change in the ownership of the Company's stock.


The Company has deferred tax assets of approximately $803,000 at June 30, 2006 relating to its net operating losses. A valuation allowance is provided for deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company provided a 100% valuation allowance for these deferred tax assets.

 

NOTE 7 - GOING CONCERN

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of business. Through June 30, 2006, the Company had incurred cumulative losses of $2,684,361 which includes the loss of $148,637 for the period ended June 30, 2006 and negative working capital of $752,247 as of June 30, 2006.

Management plans to take the following steps that it believes will be sufficient to provide the Company with the ability to continue in existence. (i) Management intends to continue to raise additional financing through private equity or debt financing to pay down Company debt and/or reduce the cost of debt service. (ii) Management is also planning to gain access to public capital markets. In this regard, the Company and the Company's major stakeholders entered into an agreement with Providential Holding, Inc. (PHI) to cancel the major notes and debts in exchange for most of the issued and outstanding shares of the Company through management restructuring see (note1).  (iii) Management intends to increase revenues and is actively pursuing additional contracts in several markets overseas. 



 

PART III EXHIBITS


The following exhibits are included as part of this Form 10-SB. References to "the Company" in this Exhibit List mean EastBridge Investment Group Corporation, an Arizona corporation.

 

Exhibit Number

Description

2.1

Plan of reorganization and exchange agreement

3.1

Articles of incorporation of EastBridge Investment Group Corporation

3.2

Articles of incorporation of EastBridge Investment Group Corporation, as amended   

3.3

Corporate bylaws for EastBridge Investment Group Corporation

4.1

Form of stock lock-up agreement

10.1

Employment agreement between Eastbridge Investment Group Corporation and Keith Wong

10.2

Employment agreement between Eastbridge Investment Group Corporation and Norm Klein

14.1

Code of ethics for EastBridge Investment Group Corporation 

23.1

Consent of EastBridge Investment Group Corporation’s auditors

99.1

Articles of Amendment for Name Change for EastBridge Investment Group Corporation





SIGNATURES

       

        In accordance with the requirements of the Securities Act of 1933, the registrant caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.   

                                                                                                             

 EastBridge Investment Group Corporation                                                                    

                                                                                                                                                                              

By:  /s/ Keith Wong

Keith Wong                                                                                                                                                   

President, Chief Executive Officer and Director