ONE Bio (ONBI) 10-Q 2010 Q1 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

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

THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal Quarter ended March 31, 2010

Commission file number 333-136643

ONE BIO, CORP.

(Exact Name of Registrant as Specified In Its Charter)

Florida	59-3656663
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

19950 W Country Club Drive, Suite 100, Aventura, Florida 33180
(Address of Principal Executive Offices)	(Zip Code)

(877) 544-2288

(Registrant’s Telephone Number,
Including Area Code)

 29900 NE 30th Avenue Suite 842 Aventura Florida 33180

Former Name and Address 

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

NONE

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

NONE

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d0 of the act.  Yes o No x

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

     Yes: x            No:  o          

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

Large Accelerated Filer  o  Accelerated Filer  o Non-accelerated Filer  o  Smaller Reporting Company  x

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).

    Yes: o            No:  x          

The number of shares of common stock outstanding as of May 12, 2010 was 30,652,311.

TABLE OF CONTENTS

PART I.  FINANCIAL INFORMATION

Item 1.	Unaudited Consolidated Financial Statements
	Consolidated Balance Sheet as of March 31, 2010 and December 31, 2009	1
	Consolidated Statements of Operations and Accumulated Other Comprehensive Income (Loss) for the Three Months Ended March 31, 2010 and 2009 (Unaudited)	2
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2010 and 2009 (Unaudited)	3
	Notes to Consolidated Financial Statements	4 - 26
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	45
Item 4.	Controls and Procedures	45
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	47
Item 2.	Market for Common Equity and Related Stockholder Matters	47
Item 3.	Defaults Upon Senior Securities	47
Item 4.	Submission of Matters to a Vote of Security Holders	47
Item 5.	Other Information	47
Item 6.	Exhibits	47
SIGNATURES		48

 FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934.  These statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses.  Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes,” “may,” “will,” “should,” “could,” “plans,” “estimates,” and similar language or negative of such terms.  Our actual results may differ significantly from those projected in the forward-looking statements.  Factors that mig ht cause or contribute to such differences include, but are not limited to, those discussed in Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”  You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report.  Although we believe that the expectations reflected in the forward-looking statements are reasonable, we do not know whether we can achieve positive future results, levels of activity, performance, or goals.  Actual events or results may differ materially.  We undertake no obligation to publicly release any revisions to the   forward-looking statements or reflect events or circumstances taking place after the date of this document.

ONE BIO, CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

CONDENSED CONSOLIDATED

 FINANCIAL STATEMENTS

FOR THE QUARTER ENDED MARCH 31, 2010

One Bio, Corp.
Consolidated Balance Sheets
(Stated in US dollars)
	March 31, 2010		December 31, 2009
ASSETS
Current assets
Cash and cash equivalents	$	8,209,731	$	4,928,968
Receivables		12,458,921		12,006,585
Inventory		5,793,606		2,976,031
Loans Receivable		2,476,588		4,223,863
Prepaid expenses		5,688,480		3,382,882
Total current assets		34,627,326		27,518,329
Property, plant and equipment, net		5,679,256		5,557,911
Land use rights		1,099,860		1,106,056
Goodwill		3,974,908		3,974,908
Intangible assets		655,775		682,058
Deposits for acquisition of intangible assets		161,153		161,151
Other Assets		15,289,417		15,633,438
TOTAL ASSETS	$	61,487,695	$	54,633,851
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES
Current liabilities
Accounts Payable and accrued liabilities	$	5,735,277	$	4,331,973
Loans payable- current portion		15,882,391		12,868,796
Deferred revenues		62,996		62,995
Deferred taxes		55,804		(29,192	)
Total current liabilities		21,736,468		17,234,572
Loans payable		4,215,856		4,215,855
Deferred taxes		125,450		101,100
TOTAL LIABILITIES		26,077,774		21,551,527
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preferred stock : par value $0.001 per share
Issued and outstanding : 10,000 and 0 shares at March 31, 2010 and December 31, 2009		10		-
Common stock : par value $0.001 per share
Authorized : 150,000,000 shares
Issued and outstanding : 29,176,396 and 29,171,990 shares at March 31, 2010 and December 31, 2009		29,177		29,172
Additional paid-in capital		16,890,581		16,197,666
Statutory reserve		1,740,016		1,740,016
Accumulated other comprehensive income		1,365,975		1,495,835
Retained earnings		11,536,546		9,965,874
Total shareholders’ equity of the company		31,562,305		29,428,563
Non-Controlling Interest		3,847,616		3,653,761
TOTAL EQUITY		35,409,921		33,082,324
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	61,487,695	$	54,633,851
See Notes to Consolidated Financial Statements

1

One Bio, Corp.
Consolidated Statements of Income and Comprehensive Income
(Stated in US dollars)
	Three Months ended March 31,
	2010			2009
Revenues	$	11,162,507		$	2,297,621
Cost of sales		7,054,796			852,686
Gross profits		4,107,711			1,444,935
Operating expenses
General and administrative expenses		1,116,844			212,215
Research and development expenses		60,388			36,466
Selling and marketing expenses		37,637			56,031
		1,214,869			304,712
Income from operations		2,892,842			1,140,223
Interest and financing expense		(199,109	)		(88	)
Interest income		3,838			249
Other income		(164,129	)		-
Income before income taxes		2,533,442			1,140,384
Provision for income taxes		(702,515	)		(297,659	)
Net income		1,830,927			842,725
Net income attributable to non-controlling interest		(193,855	)		-
Net income attributable to Company	$	1,637,072		$	842,725
Earnings per share
- Basic	$	0.06		$	0.05
- Diluted	$	0.05		$	0.05
	��
Weighted average number of shares outstanding :
- Basic		29,172,029			17,210,216
- Diluted		33,507,717			17,210,216
STATEMENT OF COMPREHENSIVE INCOME
Net Income	$	1,830,927		$	842,725
Other comprehensive income
Unrealized foreign currency gain (loss)		(129,861	)		(19,500	)
Comprehensive income		1,701,066			823,225
Comprehensive income attributable to noncontrolling interest		(193,855	)		-
Comprehensive income attributable to the Company	$	1,507,211		$	823,225
See Notes to Consolidated Financial Statements

2

One Bio, Corp.
Consolidated Statements of Cash Flows
(Stated in US dollars)
	Three Months ended March 31,
	2010			2009
Cash flows from operating activities
Net Income	$	1,830,927		$	842,725
Adjustments to reconcile net income to net cash provided by operating activities :
Depreciation		107,177			52,491
Amortization of intangible assets		26,296			12,880
Amortization of land use rights		6,215			5,836
Amortization of lease prepayments		449,625
Deferred taxes		109,346			(2,805	)
Share-based compensation		55,501			13,130
Stock option expense		29,656
Changes in operating assets and liabilities :
Accounts receivable, net		(452,336	)		(607,357	)
Prepaid and other current assets		(1,684,235	)
Inventories		(2,817,575	)		46,913
Other assets		(105,604	)
Accounts payables and accrued expenses		1,402,866			29,117
Amount due to a related party		(50,152	)		879
Income tax payable					48,072
Deferred revenue					-
Net cash flows used by operating activities		(1,092,293	)		441,881
Cash flows from investing activities
Payments to acquire property, plant and equipment		(228,107	)		-
Loan receivables		1,747,275			-
Net cash flows provided by investing activities		1,519,168			-
Cash flows from financing activities
Proceeds from bridge loan		3,000,000			-
Proceeds of bank loans		586,023			-
Repayments of government loans		-			(146,500	)
Repurchase and cancellation of common shares		(80,000	)		-
Repayments of bank loans		(342,327	)		-
Repayment of notes payable		(180,000	)		-
Reverse takeover capitalization		-			-
Exercise of warrants		-			764
Advances from a stockholder		-			-
Net cash flows proved/(used) by financing activities		2,983,696			(145,736	)
Effect of foreign currency translation on cash and cash equivalents		(129,808	)		(907	)
Net increase in cash and cash equivalents		3,280,763			295,238
Cash and cash equivalents - beginning of quarter		4,928,968			665,568
Cash and cash equivalents - end of quarter	$	8,209,731		$	960,806
Supplemental disclosures for cash flow information:
Cash paid for interest	$	-		$	-
Cash paid for Income taxes	$	-		$	252,392
See Notes to Consolidated Financial Statements

3

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

1.  Organization and Basis of Presentation

Description of the Business

One Bio, Corp. (formerly ONE Holdings, Corp), (formerly Contracted Services, Inc.) (“ONE” and/or the “Company”) was incorporated June 30, 2000 in the State of Florida as Contracted Services, Inc. and changed its name to ONE Holdings, Corp. on June 9, 2009 and subsequently on November 16, 2009 changed its name to ONE Bio, Corp.  ONE and its subsidiaries (collectively the “Corporation” or “Company”) are utilizing green processes to produce raw chemicals and herbal extracts, natural supplements and organic products. Corporation is focused on the Asia Pacific region. The Corporation’s key products include widely recognized Solanesol, CoQ10, Resveratrol and 5-HTP, organic fertilizers, and organic bamboo health food and beverages.

Basis of Presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

Basis of Consolidation

In a series of transactions that were completed on July 22, 2009, ONE completed a transaction with Green Planet Bioengineering Co., Ltd. (“GPB”) of Delaware and Abacus Global Investments, Corp. (“Abacus”) of Florida.  These transactions were accounted for as a reverse acquisition as the control of the Corporation was acquired by Abacus and the former shareholders of GPB.  The Corporation’s name was changed to One Holdings, Corp. from Contracted Services, Inc. on June 4, 2009 and subsequently changed to ONE Bio, Corp on November 16, 2009.  Although legally, ONE is regarded as the parent, GPB, whose shareholders along with Abacus, now hold more than 91% of the voting shares of the Corporation, is treated as the acquirer under US GAAP.  Consequently, ONE is deemed a continuation of GPB and control of the assets and business of ONE is deemed to have been acquired in consideration for the issuance of the shares.

During the year ended December 31, 2009, the ONE completed two acquisitions: (i) on September 3, 2009, ONE completed the purchase of 99.75% of Trade Finance Solutions Inc; and (ii) on September 27, 2009, ONE completed the purchase of 83.3% of Supreme Discovery Group Limited (“Supreme”) and subsequently increased its ownership of Supreme to 98% effective September 27, 2009.  ONE’s consolidated financial statements incorporate the results of these acquisitions, as of the acquisition date.  See “Note 8 - Acquisitions” for the unaudited condensed pro-forma results these acquisitions for the fiscal years ended December 31, 2008 and 2007.

ONE’s consolidated financial statements include the accounts of all of its majority owned subsidiaries and the accounts of its variable interest entities, of which ONE is the primary beneficiary.  All intercompany balances and transactions have been eliminated on consolidation.  The functional currency of ONE’s foreign subsidiaries is in the United States Dollar, Canadian Dollar and Chinese Yuan.  Certain prior year balances have been reclassified to conform to current year presentation.

4

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

2.  Summary of Significant Accounting Policies

Cash and Cash Equivalents

Cash and cash equivalents include demand deposits with banks, money market accounts, and other short-term investments with original maturities of 90 days or less.  Balances of cash and cash equivalents in financial institutions may at times exceed the government-insured limits.

Restricted Cash

In accordance with ASC Topic 305 formerly Accounting Review Board (“ARB”) No. 43, Chapter 3A “Current Assets and Current Liabilities”, cash which is restricted as to withdrawal is considered a non-current asset.

Receivables

Accounts receivable are recognized and carried at original invoiced amount less an allowance for uncollectible accounts, as needed.

When evaluating the adequacy of its allowance for doubtful accounts, the Company reviews the collectability of accounts receivable, historical write-offs, and changes in sales policies, customer credibility and general economic tendency.

Loans and Receivables

The assets are non-derivatives financial assets resulting from the delivery of cash or other assets by the lender to a borrower in return for a promise to repay on a specific date or dates, or on demand.  .  They are initially recognized at fair value and subsequently carried at amortized cost, using the effective interest method, less any provision for impairment.  These assets are at fair value and management believes there is no impairment as of March 31, 2010.

Concentration of Credit

The Company extends credit to its customers for which no credit insurance is available.  To date the Corporation has not incurred any significant loss due to this activity; however, if such occurrence was to occur, the loss may have an adverse effect on the financial position of the Company.

Capital Leases

The Company’s policy is to record leases, which transfer substantially all benefits and risks incidental to ownership of property, as acquisitions of property and equipment and to record the incurrence of corresponding obligations as liabilities.  Obligations under capital leases are reduced by rental payments net of imputed interest.

Inventory

Inventories are stated at the lower of cost and current market value. Costs include the cost of purchase and processing, and other costs. Inventories are stated at cost upon acquisition. The cost of inventories is calculated using the weighted average method. Any excess of the cost over the net realizable value of each item of inventories is recognized as a provision for diminution in the value of inventories.

Net realizable value is the estimated selling price in the normal course of business less the estimated costs to completion and the estimated expenses and related taxes to make the sale.

5

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

MARCH 31, 2010

2.  Summary of Significant Accounting Policies - continued

Property, Plant and Equipment

Property, plant and equipment are stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs, which are not considered improvements and do not extend the useful life of the asset, are expensed as incurred; additions, renewals and betterments are capitalized. When assets are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gain or loss is included in the statement of operations in cost of blended products.

Depreciation is provided to recognize the cost of the asset in the results of operations. The Company calculates depreciation using the straight-line method with estimated useful life as follows:

Building and structural components 20 years

Computer equipment and software 5 years

Leasehold improvements 7 years

Machinery and equipment 10 years

Office equipment and furniture 5 years

Technology 5 - 10 years

Vehicles 5 years

Land Use Rights

Land use rights represent the purchased rights to use land granted PRC land authorities.  Depending on the PRC land authority, the land use rights can be conveyed in the form of a prepaid lease or a use agreement.  Land use rights are stated at cost less accumulated amortization.  Amortization is provided using the straight line method over the terms of the agreement which range over a term of 30 to 50 years obtained from the relevant PRC land authorities.

Intangible Assets

Intangible assets consist mainly of proprietary technology and software. The intangible assets are amortized using straight-line method over the life of the assets.

Impairment of Long-lived Assets

In accordance with ASC Topic 360 Formerly Statement of Financial Accounting Standards (“SFAS”) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, certain assets such as property, plant, and equipment, and purchased intangibles, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Intangible assets are tested for impairment annually. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.  There were no events or changes in circumstances that necessitated a review of impairment of long lived assets as of March 31, 2010 as well as March 31, 2009, respectively.

6

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

2. Summary of Significant Accounting Policies - continued

Revenue Recognition

The Company recognizes revenues in accordance with the guidance in the Securities and Exchange Commission (“SEC”) ASC Topic 605 Formerly Staff Accounting Bulletin (“SAB”) No. 104. Revenue is recognized when persuasive evidence of an arrangement exists, when the selling price is fixed or determinable, when delivery occurs and when collection is probable. The Company recognizes sales revenue when goods are shipped or ownership has transferred.

Employee Future Benefits

Pursuant to the relevant laws and regulations in the PRC, the Company participates in various defined contribution retirement plans organized by the respective divisions in municipal and provincial governments for its employees. The Company is required to make contributions to the retirement plans in accordance with the contribution rates and basis as defined by the municipal and provincial governments. The contributions are charged to the respective assets or the income statement on an accrual basis. When employees retire, the respective divisions are responsible for paying their basic retirement benefits. The Company does not have any other obligations in this respect.

Income Taxes

The Company accounts for income taxes in accordance with ASC topic 740 formerly Statement of Financial Accounting Standards (“SFAS”) No. 109, “Accounting for Income Taxes”. Under SFAS No. 109, deferred tax assets and liabilities are determined based on temporary differences between accounting and tax bases of assets and liabilities and net operating loss and credit carry forwards, using enacted tax rates in effect for the year in which the differences are expected to reverse.  Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.  A provision for income tax expense is recognized for income taxes payable for the current period, plus the net changes in deferred tax amounts.  Any interest and penalties are expensed in the year that the Notice of Assessment is received.

The Company’s practice is to recognize interest and/or penalties to income tax matters in income tax expense.

Use of Estimates

The preparation of consolidated financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses for the periods reported.  Actual results could differ from those estimates.  Significant items that require estimates are goodwill, deferred tax assets, stock-based compensation, deferred tax liabilities and the depreciation, and amortization of the Corporation’s assets.

7

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

2. Summary of Significant Accounting Policies - continued

Costs of Raising Equity Capital

Costs of raising capital include legal, professional fees and agent fees associated with the raising of equity and debt capital.

Incremental costs incurred in respect of raising capital are charged against equity or debt proceeds raised.  Costs associated with the issuance of share capital are charged to capital stock upon the raising of share capital.  Costs associated with the issuance of debt are part of the carrying value of the debt and charged to operations as non-cash financing expense using the effective interest rate method.

Foreign Currency Translation

In accordance with ASC Topic 830 formerly SFAS No.52, “Foreign Currency Translation”, the financial statements of subsidiaries of the Company are measured using local currency (Canadian Dollar and Chinese Yuan) as the functional currency.  Assets and liabilities have been translated at period-end exchange rates and related revenue and expenses have been translated at average exchange rates. Gains and losses resulting from the translation of subsidiaries’ financial statements are included as a separate component of shareholders’ equity accumulated in other comprehensive income.

Fair Value of Financial Instruments

The Company estimates the fair value of its financial instruments based on current interest rates, quoted market values or the current price of financial instruments with similar terms. Unless otherwise disclosed herein, the carrying value of financial instruments, especially those with current maturities such as cash and cash equivalents, accounts receivable, and accounts payable and accrued liabilities are considered to approximate their fair values.

Fair Value Measurements

In April 2009, the Financial Accounting Standard Board (“FASB”) released ASC 820, Fair Value Measurements and Disclosures, (formerly SFAS No. 157 “Fair Value Measurements”) that defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP, and expands disclosures about fair value measurements.

According to ASC 820, investment measured and reported at fair value are classified and disclosed in one of the following hierarchy:

Level 1 -         Quoted prices are available in active markets for identical investments as of the reporting date.  The type of investments included in Level 1 included listed equities and listed derivatives.

Level 2 -         Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies.  Investments that are generally included in this category include corporate bonds and loans, less liquid and restricted equity securities and certain over-the-counter derivatives.

8

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

2. Summary of Significant Accounting Policies - continued

Level 3 -         Pricing inputs are unobservable for the investment and included situations where there is little, if any, market activity for the investment.  The inputs into the determination of fair value require significant management judgment or estimation.

Stock-Based Compensation Plan

The Corporation uses the fair value-based method for measurement and cost recognition of employee share-based compensation arrangements under the provisions of ASC Topic 718 formerly FASB, SFAS 123 (Revised 2004) and Share-Based Payment (SFAS 123R), using the modified prospective transitional method.

Under the modified prospective transitional method, share-based compensation is recognized for awards granted, modified, repurchased or cancelled subsequent to the adoption of SFAS 123R.  In addition, share-based compensation is recognized, subsequent to the adoption of SFAS 123R, for the remaining portion of the vesting period (if any) for outstanding awards granted prior to the date of adoption.

We measure share-based compensation costs on the grant date, based on the calculated fair value of the award.  We have elected to treat awards with graded vesting as a single award when estimating fair value. Compensation cost is recognized on a straight-line basis over the employee requisite service period, which in our circumstances is the stated vesting period of the award, provided that total compensation cost recognized at least equals the pro rata value of the award that has vested. Compensation cost is initially based on the estimated number of options for which the requisite service is expected to be rendered.  This estimate is adjusted in the period once actual forfeitures are known.

Earnings Per Share

Earnings (loss) per common share are reported in accordance with ASC Topic 260 formerly SFAS No. 128, “Earnings Per Share”. SFAS No. 128 requires dual presentation of basic earnings per share (“EPS”) and diluted EPS on the face of all statements of earnings, for all entities with complex capital structures.  Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of these options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.  Fully diluted profit/loss per common share is not provided, when the effect is anti-dilutive.

When the effect of dilution on loss per share is anti-dilutive, diluted loss per share equals the loss per share.

9

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

2. Summary of Significant Accounting Policies - continued

Comprehensive Income

The Company follows ASC Topic 220 formerly Statement of Financial Accounting Standards No. 130, “Reporting Comprehensive Income”.  This statement establishes standards for reporting and display of comprehensive income and its components. Comprehensive income is net income plus certain items that are recorded directly to shareholders’ equity bypassing net income.  Other than foreign exchange gains and losses, the Company has no other comprehensive income (loss).

Recent Changes in Accounting Standards

Recent accounting pronouncements that the Company has adopted or that will be required to adopt in the future are summarized below.

In August 2009, the FASB issued ASU 2009-05 which includes amendments to Subtopic 820-10, “Fair Value Measurements and Disclosures—Overall”. The update provides clarification that in circumstances, in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the techniques provided for in this update. The amendments in this ASU clarify that a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of the liability and also clarifies  that both a quoted price in an active market for the identical liability at the measurement date and the quoted price for the identical liability when traded as an asset in an active market when no adjustments to the quoted price of the asset are required are Level 1 fair value measurements. The guidance provided in this ASU is effective for the first reporting period, including interim periods, beginning after issuance.  The adoption of this standard did not have a material impact on the Company’s consolidated financial position and results of operations.

In September 2009, the FASB issued ASU 2009-06, Income Taxes (Topic 740), “Implementation Guidance on Accounting for Uncertainty in Income Taxes and Disclosure Amendments for Nonpublic Entities”, which provides implementation guidance on accounting for uncertainty in income taxes, as well as eliminates certain disclosure requirements for nonpublic entities.  For entities that are currently applying the standards for accounting for uncertainty in income taxes, this update shall be effective for interim and annual periods ending after September 15, 2009. For those entities that have deferred the application of accounting for uncertainty in income taxes in accordance with paragraph 740-10-65-1(e), this update shall be effective upon adoption of those standards. The adoption of this standard is not expected to have an impact on the Company’s consolidated financial position and results of operations since this accounting standard update provides only implementation and disclosure amendments.

In September 2009, the FASB has published ASU No. 2009-12, “Fair Value Measurements and Disclosures (Topic 820) - Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”. This ASU amends Subtopic 820-10, “Fair Value Measurements and Disclosures – Overall”, to permit a reporting entity to measure the fair value of certain investments on the basis of the net asset value per share of the investment (or its equivalent). This ASU also requires new disclosures, by major category of investments including the attributes of investments within the scope of this amendment to the Codification. The guidance in this Update is effective for interim and annual periods ending after December 15, 2009. Early application is permitted.The adoption of this standard is not expected to have an impact on the Company’s consolidated financial position and results of operations.

10

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

In January 2010, the FASB has published ASU 2010-01 “Equity (Topic 505)- Accounting for Distributions to Shareholders with Components of Stock and Cash—a consensus of the FASB Emerging Issues Task Force,” as codified in ASC 505,. ASU No. 2010-01 clarifies the treatment of certain distributions to shareholders that have both stock and cash components. The stock portion of such distributions is considered a share issuance that is reflected in earnings per share prospectively and is not a stock dividend. The amendments in this Update are effective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  Early adoption is permitted.  The adoption of this standard did not have an impact on the Company’s (consolidated) financial position and results of operations.

In January 2010, the FASB has published ASU 2010-02 “Consolidation (Topic 810)- Accounting and Reporting for Decreases in Ownership of a Subsidiary—a Scope Clarification,” as codified in ASC 810, “Consolidation.” ASU No. 2010-02 applies retrospectively to April 1, 2009, our adoption date for ASC 810-10-65-1. This ASU clarifies the applicable scope of ASC 810 for a decrease in ownership in a subsidiary or an exchange of a group of assets that is a business or nonprofit activity. The ASU also requires expanded disclosures. The amendments in this Update are effective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  .  The adoption of this standard is not expected to have any impact on the Company’s consoli dated financial position and results of operations.

In October 2009, the FASB has published ASU 2009-13, “Revenue Recognition (Topic 605)-Multiple Deliverable Revenue Arrangements”, which addresses the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than as a combined unit. Specifically, this guidance amends the criteria in Subtopic 605-25, “Revenue Recognition-Multiple-Element Arrangements”, for separating consideration in multiple-deliverable arrangements. This guidance establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (a) vendor-specific objective evidence; (b) third-party evidence; or (c) estimates. This guidance also eliminates the residual method of allocation and requires that arrangement consideration be alloca ted at the inception of the arrangement to all deliverables using the relative selling price method and also requires expanded disclosures. The guidance in this update is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. Early adoption is permitted. The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In October 2009, the FASB has published ASU 2009-14, “Software (Topic 985)-Certain Revenue Arrangements that Include Software Elements” and changes the accounting model for revenue arrangements that include both tangible products and software elements. Under this guidance, tangible products containing software components and nonsoftware components that function together to deliver the tangible product’s essential functionality are excluded from the software revenue guidance in Subtopic 985-605, “Software-Revenue Recognition”. In addition, hardware components of a tangible product containing software components are always excluded from the software revenue guidance.  The guidance in this ASU is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beg inning on or after June 15, 2010. Early adoption is permitted.  The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

11

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

In December 2009, the FASB has published ASU 2010-16 ““Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets.” ASU No. 2009-16 is a revision to ASC 860, “Transfers and Servicing,” and amends the guidance on accounting for transfers of financial assets, including securitization transactions, where entities have continued exposure to risks related to transferred financial assets. ASU No. 2009-16 also expands the disclosure requirements for such transactions. This ASU will become effective for us on April 1, 2010..  The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In December 2009, the FASB has published ASU 2010-17 Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities.” ASU No. 2009-17 amends the guidance for consolidation of VIEs primarily related to the determination of the primary beneficiary of the VIE. The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In January 2010, the FASB has published ASU 2010-06 “Fair Value Measurements and Disclosures (Topic 820): - Improving Disclosures about Fair Value Measurements. ASU No. 2010-06 clarifies improve disclosure requirement related to fair value measurements and disclosures – Overall Subtopic (Subtopic 820-10) of the FASB Accounting Standards Codification. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosure about purchase, sales, issuances, and settlement in the roll forward of activity in Level 3 fair value measurements.  Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The amendments in this Update are e ffective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

Other ASUs not effective until after December 31, 2009, are not expected to have a significant effect on the Company’s consolidated financial position or results of operations.

3.  Supplemental Cash Flow Information

For the Periods Ended March 31, 2010 2009

Supplemental disclosure
Interest paid	$	104,917		-
Income taxes paid	$	1,089,849	$	252,392
Non-cash transaction
Issuance of warrants on convertible notes	$	621,363		-

4.   Accounts Receivables

	March 31, 2010			December 31, 2009
Accounts receivables	$	12,470,184		$	12,017,848
Allowances for doubtful accounts		(11,263	)		(11,263	)
Accounts receivable, net	$	12,458,921		$	12,006,585

12

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

5.   Inventory

	March 31, 2010		December 31,2009
Raw material	$	270,286	$	140,759
Packaging material		150,233		59,954
Work in progress		5,124,675		2,610,245
Finished goods		248,412		165,073
	$	5,793,606	$	2,976,031

6. Property, Plant and Equipment

	March 31, 2010			December 31,2009
Building and structural components	$	3,471,763		$	3,580,686
Machinery		1,815,670			1,806,118
Office equipment and furniture		437,094			306,685
Vehicles		140,457			109,590
Leasehold Improvement		87,902			-
		5,952,886			5,803,079
Less: accumulated depreciation		(1,232,643	)		(1,130,912	)
		4,720,243			4,672,167
Construction in progress		959,008			885,744
	$	5,679,251		$	5,557,911

During the periods, depreciation is included in:

For the Periods Ended March 31,	2010		2009
Cost of sales	$	66,182	$	62,510
Administrative and R&D Expenses		35,595		27,027

7.   Intangible Assets

The following is a summary of the Corporation’s intangible assets:

	March 31, 2010			December 31,2009
Technology	$	871,693		$	871,680
Software		5,303			5,304
		876,996			876,984
Less: accumulated amortization		(221,221	)		(194,926	)
	$	655,775		$	682,058

The estimated aggregate amortization expense for intangible assets for the five succeeding years is $369,729 per year.

13

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

8.   Goodwill

Goodwill is recorded when the consideration paid for an acquisition of a business exceeds the fair value of identifiable net tangible and intangible assets. Goodwill was recorded with the purchase of TFS in the amount of $3,974,908.

	March 31, 2010
Balance December 31, 2009	$	3,974,908
No impairment on acquisitions		-
Balance March 31, 2010	$	3,974,908

Future adjustments to prior acquisitions may be required primarily due to adjustments to plans formulated in accordance with the ASC Topic 805.

9.   Restricted Cash

One of the Company’s operating subsidiaries in the PRC has established a credit facility with a local lender denominated in RMB.  The facility was partially guaranteed by the Rural Credit Cooperatives Cooperation of Jianou City.  The credit facility provides that the Company deposit 50% of the total credit applied into an Escrow Account as further guaranty against default.  As of March 31, 2010, the cash on deposit but restricted as to access was $681,239.

10.   Loans Payable

The Company has entered into certain financial agreements and loans payable as follows:

Borrowings	March 31, 2010		December 31, 2009
CCB	$	1,465,030	$	1,465,008
Financial Institution		1,860,588		1,860,561
Rural Cooperative		1,318,527		732,504
Reverse Acquisition of GPB		980,349		980,349
Acquisition of TFS		3,000,000		3,000,000
Acquisition of Supreme		2,258,400		2,438,400
Financial Services		6,107,553		6,449,880
Bridge Loan		3,000,000		-
Other		107,800		157,950
Total		20,098,247		17,084,652
Loans Payable, current portion		15,882,391		12,868,796
Loans Payable, less current portion	$	4,215,856	$	4,215,856

14

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The Company has long term loans payable in 2011 and 2012 of $1,715,856 and $2,500,000 respectively.

CCB - The amount represents borrowings from a financial institution and accrues interest at 6.11%.  The borrowing matures on April 17, 2010.

Financial Institution - The Company has negotiated two loans, both of which carry interest at the annual rate of 7.434%.  The loan of $659,263 is secured by a guarantee company.  The Company has pledged its plant and equipment with carrying value of $725,334 and paid a counter guarantee of $146,503 to the guarantee company.  The guarantee company charges a fee at 1.8% per annum on the loan.  The other loan of $1,201,325 is secured by the Company’s property with carrying value of $1,885,687.

Rural Cooperative - The amounts represent borrowings from the Rural Credit Cooperatives Cooperation of Jian Ou City.  The borrowing matures on July 8, 2010.

Reverse Acquisition of GPB - The amounts represent notes issued in connection with the acquisition of Green Planet Bioengineering Limited.  There were two notes issued, one for $445,613 which matures on July 22, 2010 and one for $534,736 which matures on July 22, 2011.

Acquisition of TFS - The amount represents the cash consideration due in connection with the acquisition of Trade Finance Solutions, Inc.  Payment is due based on the achievement of certain milestones.

Acquisition of Supreme - The amounts represent notes issued in connection with the acquisition of Supreme Discovery Group Limited.  There were four notes issued.   One for $180,000 which matures on May 10, 2010 (paid in full January 2010), one for $557,280 which matures on September 22, 2010, one for $1,020,000 which matures on November 10, 2010,  and one for $681,120 which matures on September 22, 2011.

Financial Services - The amounts represent borrowings to fund the financial services activities of our financing subsidiary, Trade Finance Solutions, Inc.  These borrowings are obtained by approximately 20 private investors with one year renewable agreements, an interest rate of 12% and secured by a first charge on receivables.

Bridge Loan – The amount represents the borrowings in connection with bridge loan with interest rate of 8% per annum and maturity date of nine months.

Other - The amounts are payable to shareholder and related parties.  The amounts are interest-free, unsecured and payable on demand.

11.   Loans Receivable

The bulk of our notes receivable are generated through the operations of our financing business unit.  That unit’s primary business activity involves providing creative financing solutions including purchase order financing, fulfillment services and factoring or invoice discounting to commercial enterprises.  Accordingly, the financing business unit documents its financing activities through a series of notes issued by its customers.  These notes are issued at market rates, based on the creditworthiness of the customer and mature based on the project and the nature of the underlying collateral.  The notes are typically secured by credit insurance and by the assignment of various forms of collateral, such as the proceeds of assigned tr ade receivables or issued invoices.

15

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

12.   Land Use Rights

General

Land Use Rights are generally associated with the long-term use of land underlying a building or production facility in the PRC.  These rights have characteristics similar to a real estate property deed under western law in that they are:

1. paid for at initial acquisition

2.  have an extended life, up to 50 years

3.  generally relate to a building or production facility

4.  may be pledged as collateral for debt

5.  require no further payments by the owner unless the land usage or building configuration is modified

They differ from a real estate property deed in that:

1. the transfer of use rights is not permanent

2. and therefore they are amortized over their life.

Sanming Hujian Bio-Engineering, Co., Ltd.

In July 2004, the Company acquired land use rights to construct its main operating and production facilities for $1,122,557.   The land use rights expire in 2054.   The Company recognizes $22,451 in expense annually as amortization of its land use rights.   The Company has pledged its land use rights as collateral according to a short term borrowing agreement with the Rural Credit Cooperative.

Jianou Lujian Foodstuff, Co.

In January 2004, the Company acquired land use rights to construct its main operating and production facilities for $138,647.   The land use rights expire in 2054.   The Company recognizes the expense annually in the amount of $2,173 as amortization of its land use rights.   The Company has pledged its land use rights as collateral according to a loan agreement with the Jianou Sub-Branch of China Construction Bank.

13.   Other Assets

Other assets consist of the following:		March 31,		December 31,
		2010		2009
Land Lease Rights
Green Planet (CHE)	$	9,052,419	$	9,502,044
UGTI (OP)		5,387,052		5,567,031
Restricted Cash (Note 9)		681,239		388.227
Other		168,707		176,136
Total Other Assets	$	15,289,417	$	15,633,438

16

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

General

Other assets include items which also represent the right to use land but typically these rights have characteristics similar to real estate leases under western law in that they are:

1.   paid for through a series of interim payments that permit continued use

2.   may have long lives, up to 30 years, but are less than Land Use rights

3.   generally relate to agricultural uses

Forestry Bureau of Sanming City

In July 2009 the Company entered into 2 land use agreements with the Forestry Bureau of Sanming City to use agricultural land on 2 plantations to grow essential botanical raw materials to support the Company’s operations.  The agreement provides for payments every five years of$9,083,184 and will expire in 2039.   As part of this agreement, the Company was required to prepay the first five year leasing period of $9,052,419 which includes an initial nonrefundable deposit of $1,845,289, which can be offset against the rental of the last year of the last leasing period.  Accordingly, the Company recognized the lease expense in its reported operating expenses for the period ended, March 2010 reflecting the amortiz ation of these land use agreements and recognized $449,625 of lease expense.

 The Company has the following commitments under the agreements:

Year	Commitment		Amortization
2010	$	-	$	1,349,405
2011		-		1,799,030
2012		-		1,799,030
2013		-		1,799,030
2014		9,083,184		1,799,030
Thereafter		34,486,294		43,865,545
Total		43,569,478		52,232,070

Yushan Town (harvest rights)

In 2007 the Company entered into 2 land leasing agreements with Jixi Village and Linkou Village, Yushan Town for exclusive harvest rights to the bamboo shoots and bamboo grown in the plantations based in the two villages, which are an essential botanical raw materials used to support the Company’s operations.  The agreement provides for annual payments on an accelerated schedule which is currently at $659,254 and will expire in 2037.   As part of this agreement, the Company was required to make an initial nonrefundable deposit of $8,790,050, of which it has already deposited $5,567,031 leaving $3,223,018 due on May 31, 2010.  The agreement provides that the deposit can be offset against the rental of the last 10 years of the leasing period.

17

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The Company has the following commitments under the agreements:

			Lease
Year	Commitment		Expense
2010	$	3,882,272	$	659,254
2011		659,254		659,254
2012		725,179		725,179
2013		725,179		725,179
2014		725,719		725,179
Thereafter		2,377,056		11,167,105
Total		9,094,119		14,661,150

14.   Defined Contribution Plan

Pursuant to the relevant PRC regulations, the Company is required to make contributions at a rate of 29% of the average salaries for the latest fiscal year-end of Fujian Province to a defined contribution retirement plan organized by a state-sponsored social insurance plan in respect of the retirement benefits for the Company’s employees in the PRC.  The only obligation of the Company with respect to retirement plan is to make the required contributions under the plan.  No forfeited contribution is available to reduce the contribution payable in the future years.  The defined contribution plan contributions were charged to the statement of income and comprehensive income.

The Company contributed $29,875 and $16,279 for the three months ended March 31, 2010 and 2009, respectively.

15.   Related Party Transactions

Amounts due to the related parties are payable to entities controlled by shareholders, officers or directors of the Corporation as are transactions with these related parties.  These amounts are non-interest bearing, unsecured and not subject to specific terms of repayment unless stated otherwise.

	For the Quarter ended March 31
	2010		2009
Repurchase of 16,000 common shares	$	80,000	$	---
Proceeds paid to an entity whose director is a shareholder		4,711		879
Interest expense		---		---
	March 31, 2009		December 31, 2009
Demand loans with no interest and recorded within loans payable		107,800		157,950

18

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The above transactions are in the normal course of operations and have been measured at the exchange amount which is the amount of consideration established and agreed to by the related parties.

16.   Capital Stock

The Corporation is authorized to issue 150,000,000 common shares with a par value of $0.001.  Each common share entitles the holder to one vote.

During the quarter ending March 31, 2010, the Corporation had the following capital transactions:

1.      issued 10,000 shares of preferred stock as consideration for guarantee of bridge loan financing.

2.      issued 12,500 common shares for directors compensation.

3.      Issued 7,906 of common shares for services rendered.

4.      Repurchased 16,000 common shares at a total cost of $80,000

17.   Warrants

The Company does not have a formal plan in place for the issuance of stock warrants. However, at times, the Company will issue warrants to non-employees or in connection with financing transactions. The exercise price, vesting period, and term of these warrants is determined by the Company’s Board of Directors at the time of issuance. A summary of warrants at March 31, 2010 and activity during the year then ended is presented below:

	Shares		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding at January 1, 2010		1,696,000	$	5.00			$	1,746,880
Issued		444,298		6.08				-
Exercised		—		—
Forfeited		—		—
Outstanding at March 31, 2010		2,140,298	$	5..22		3.0	$	1,746,880
Exercisable at March 31, 2010		—	$	0.00		3.0	$	—

19

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The following information applies to warrants outstanding and exercisable at March 31, 2010:

	Warrants Outstanding				Warrants Exercisable
	Shares	Weighted- Average Remaining Contractual Term		Weighted- Average Exercise Price		Shares		Weighted- Average Exercise Price
$5.00	1,696,000	3	$	5.00		—	$	—
$5.01 – $6.00	444,298	5	$	6.08		—	$	—
	2,140,298	3	$	5.22		—	$	—

During the quarter ended March 31, 2010, the Company issued the following warrants:

Bridge Loan –

For the quarter ended March 31, 2010, the Company issued warrants to purchase 444,298 shares in connection with a bridge loan financing transaction.  The fair value of the warrants was determined by the Black-Scholes valuation model. The warrants were subject to certain “lock-up and leak out” provisions and expire on the fifth anniversary of the issuance date.

The Company uses the Black-Scholes valuation model to determine the fair value of warrants on the date of grant. This model derives the fair value of options based on certain assumptions related to the expected stock price volatility, expected life, risk-free interest rates and dividend yield.  For the period through December 31, 2009 the Company’s expected volatility is based on actual fluctuations in its share prices. The risk-free interest rate assumption is based upon the U.S. Treasury yield curve appropriate for the term of the expected life of the options.

For the quarter ended March  31, 2010, the fair value of each warrant grant was estimated on the date of grant using the following weighted-average assumptions.

20

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

	For the year ended March 31,
	2010		2009
Expected dividend yield	00.0	%	00.0	%
Expected price volatility	9.7	%	0	%
Risk free interest rate	1.35	%	0	%
Expected life of options in years	5		0

18.   Stock Based Compensation

During the three months ended March 31, 2010, we recognized total non-cash stock-based compensation of $29,656.  All stock option expenses are booked to general and administrative expenses.

We issued 2,500,000 options on September 1, 2009 to three  management personnel of the Company and recoded and expense of $16,489 for the three months ended March 31, 2010.  Of these options, 20% vest six months from issue date (with $3.25 exercise price) with 40% each vesting on the first and second anniversary of the issue date ($3.50 and $3.75 exercise price, respectively).  The options expire on September 1, 2014.   The aggregate fair value of the options granted was $23,035 at the date of grant, which was determined using the Black-Scholes option valuation model with the following assumptions: fair value stock price of $0.672 at grant date,  risk-free interest rate of 2.33%, volatility of 40%, nil expected dividends and expected life of 5 years. Additionally, we issued 170,000 options to two manageme nt personnel which vest on the completion of future milestones.  The options have an exercise price of $3.00 and expire in 5 years.

We also issued 75,000 options to five non-employee directors on January 12, 2010 and recorded an expense of $13,167 for the three months ended March 31, 2010.   The options vest 25% per quarter over the first year and expire on January 12, 2015, with an exercise price of $6.09.  The aggregate fair value of the options granted was $45,640 at the date of grant, which was determined using the Black-Scholes option valuation model with the following assumptions: fair value stock price of $6.09 at grant date,  risk-free interest rate of 2.49%, volatility of 17.95%, nil expected dividends and expected life of 2 years.

The Option activity during the fiscal quarter ended march 31, 2010 is as follows:

			Number of Options
			Outstanding						Outstanding
			as of				Granted/		as of
	Exercise		January				forfeited/		March
Month of grant	price			1, 2009	Exercised		cancelled			31, 2010
January  2010	$	3.25		-		-		2,500,000		2,500,000
January  2010	$	3.00		-				170,000		170,000
January  2010	$	6.09		-				75,000		75,000
December 2009	$	6.00		-		-		2,500		2,5000
				-		-		2,747,500		2,747,500

21

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

19.   Statutory Reserve

The Corporation’s income is distributable to its shareholders after transfer to statutory reserves as required under relevant PRC laws and regulations and the Corporation’s articles of association.  As stipulated by the relevant laws and regulations in the PRC, the Corporation is required to maintain a statutory surplus reserve fund which is non-distributable.  Appropriation to such reserves is made out of net profit after taxation of the statutory financial statements of the Corporation as a proportion of income after taxation of 10%.

The statutory surplus reserve fund can be used to make up prior year losses, if any, and can be applied in conversion into capital by means of capitalization issue.  The appropriation may cease to apply if the balance of the fund has reached 50% of the relevant entity’s registered capital.

20.   Taxation

Income Tax

United States

The Company is subject to the United States of America Tax law at tax rate of 40.7%.  No provision for the US federal income taxes has been made as the Company had no taxable income in this jurisdiction for the reporting periods. The Company has not provided deferred taxes on undistributed earnings of its non-U.S. subsidiaries or VIE as of March 31,  2010  as it was the Company’s current policy to reinvest these earnings in non-U.S. operations

BVI

Elevated Throne was incorporated in the BVI and, under the current laws of the BVI, is not subject to income taxes.

PRC

The PRC’s legislative body, the National People’s Congress, adopted the unified Corporate Income Tax Law on March 16, 2007. This new tax law replaces the existing separate income tax laws for domestic enterprises and foreign-invested enterprises and became effective on January 1, 2008.  Under the new tax law, a unified income tax rate is set at 25% for both domestic enterprises and foreign-invested enterprises.

Accordingly, Fujian Green Planet and Sanming Huajian, both of which are established in the PRC, are subject to PRC enterprise income tax at the rate of 25% on their assessable profits during the three month period ended March 31, 2010 and 2009.

22

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The components of the provision for income taxes are:-

	March 31, December 31,
	2010		2009
Current taxes - PRC	$	237,490	$	1,403,897
Deferred taxes		16,363		89,658
	$	253,853	$	1,493,555

Deferred tax assets as of March 31, 2010 and December 31, 2009 composed of the following:

	As of March, 31 December, 31
The PRC	2010			2009
Current deferred tax assets :
Decelerated amortization of land use rights	$	-		$	-
Decelerated amortization of intangible assets		4,395			4,395
Provision of expenses		81,097			72,378
	$	85,492		$	76,772
Non-current deferred tax assets :
Accelerated amortization of intangible assets	$	18,679		$	18,679
Provision of expenses		4,091			4,091
	$	22,770		$	22,770
Current deferred tax liabilities
Rental expenses capitalized in inventory	$	(173,663	)	$	(148,581	)

21.   Contingencies

From time to time, the Corporation may be exposed to claims and legal actions in the normal course of business, some of which may be initiated by the Corporation.  As of March 31, 2010, no material claims were outstanding.

22.   Segmented Information and Major Customers

The Corporation uses the “management approach” in determining reportable operating segments.  The management approach considers the internal organization and reporting used by the Corporation’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Corporation’s reportable segments.  Accordingly, in accordance with ASC Topic 280-10 “Segment Reporting”, the Corporation’s operations comprises of three reporting segments engaged in herbal and chemical extracts, organic products and financing within Canada, China and the United States.

23

ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

The following represents the segmented information based on geographical distribution as at December 31:

For the three months ended March 31, 2010	Asia		North America(1)		Total
Sales	$	7,710,678	$	3,451,829	$	11,162,507
Cost of sales		4,088,204		2,966,592		7,054,796
Gross profit		3,622,474		485,237		4,107,711
Operating expenses		555,890		284,431		840,321
Operating profit		3,066,584		200,806		3,267,390
Corporate expenses, including amortization)						534,839
Interest/other expense						199,109
Income before income taxes and non-controlling interest						2,533,442
Assets at March 31, 2010	$	46,849,173	$	14,638,521	$	61,487,694

(1) North America segment includes $223,265 of interest income classified as Sales and $237,595 of interest expense classified as Cost of sales.

For the three months ended March 31, 2009	Asia		North America		Total
Sales	$	2,297,621	$	- - -	$	2,297,621
Cost of sales		-		-		-
Gross profit		1,444,935		- - -		1,444,935
Operating expenses		304,712		- - -		304,712
Operating profit		1,140,223		- - -		1,140,223
Corporate expenses, including amortization)						(249	)
Interest/other expense						88
Income before income taxes and non-controlling interest						1,140,384
Assets at December 31, 2009	$	42,937,742	$	11,696,109	$	54,633,851

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ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

23. Segmented Information and Major Customers - continued

The following represents the segmented information based on operating segments as of March 31;

For the three months ended March 31, 2010	Chemical and Herbal Extracts (CHE)		Organic Products (OP)			Financing (1) (FIN)		Corporate		Total
Sales	$	3,259,429	$	4,451,249		$	3,451,829	$	- - -	$	11,162,507
Cost of sales		1,469,280		2,618,924			2,966,592		- - -		7,054,796
Gross profit		1,790,149		1,832,325			485,237		- - -		4,107,711
Operating expenses		556,498		(608	)		284,431		- - -		840,321
Operating profit		1,233,651		1,832,933			200,806		- - -		3,267,390
Corporate expenses, including amortization)											534,839
Interest/other expense											199,109
Income before income taxes and non-controlling interest											2,533,442
Assets at March 31, 2010	$	24,745,938	$	22,103,235		$	12,829,964	$	1,808,557	$	61,487,694

(1) Financing segment includes $223,265 of interest income classified as Sales and $237,595 of interest expense classified as Cost of sales.

For the three months ended March 31, 2009		Chemical and Herbal Extracts (CHE)		Organic Products (OP)		Financing (FIN)		Corporate		Total
Sales	$	2,297,621	$	- - -	$	- - -	$	- - -	$	2,297,621
Cost of sales		852,686		- - -		- - -		- - -		852,686
Gross profit		1,444,935		- - -		- - -		- - -		1,444,935
Operating expenses		304,712		- - -		- - -		- - -		304,712
Operating profit		1,140,223		- - -		- - -		- - -		1,140,223
Corporate expenses, including amortization)										(249	)
Interest/other expense										88
Income before income tax  and non-controlling interest										1,140,384
Assets at December 31, 2009	$	22,746,713	$	20,191,029	$	11,342,020	$	354,089	$	54,633,851

During the quarter ended March 31, 2010, the Company had no sales to any customer that exceeded 10% of total revenues.

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ONE BIO CORP.

(PREVIOUSLY CONTRACTED SERVICES, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2010

24. Subsequent Events

On April 19, 2010 the Company announced (i) the cancellation of the amended and restated Green Planet preferred stock purchase agreement, (ii) One returned to GP  the 5,101 shares of GP preferred stock, and (iii) GP returned to One the 1,004,807 shares of One common stock that had been issued.

On April 14, 2010, GP granted to ONE an option to acquire 100% of the stock of Elevated Throne Overseas Ltd. (“Elevated Throne”), GP’s 100% owned BVI subsidiary. In the event ONE exercises this option, the closing of the transaction will be subject to the approval of GP’s stockholders. Furthermore, as a result of this event and if the transaction is fully consummated, ONE will own 100% of Elevated Throne and its subsidiaries which constitutes essentially all former operations of Green Planet. Green Planet will remain a subsidiary of ONE and operate as a public shell corporation with the business purpose to acquire or merge with an existing business operation. Additionally, the Company announced the appointment of Jan Koe to the audit committee.

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

Overview

ONE Bio, Corp. (the “Company” and/or “ONE” and/or “Registrant”) (www.onehcorp.com) headquartered in Miami, FL, is a company utilizing green processes specialized in raw chemicals and herbal extracts, natural supplements and organic products. ONE is focused on the Asia Pacific region. Key products include widely recognized Solanesol, CoQ10, Resveratrol and 5-HTP, organic fertilizers, and organic bamboo health food and beverages. ONE’s growth plan targets an aggressive acquisition driven strategy supported by strong organic growth. Through ONE, small private companies gain access to capital, experienced management and strategic insight. ONE builds strong synergies amongst all subsidiari es to enhance shareholder value. ONE is working with each subsidiary to promote organic and acquisition driven growth. Prior to the acquisition of a majority equity interest in the Company by Abacus Global Investments, Corp. (“Abacus”) June 4th, 2009 Company operated a computer consulting and a commercial lawn maintenance business and was previously located in St. Petersburg, Florida. Immediately following Abacus’ acquisition the Company’s business purpose changed as outlined above.

Company was incorporated under the laws of the State of Florida on June 30, 2000 under the name of Contracted Services, Inc.

On May 29, 2009 Contracted Services, Inc. entered into a material definitive agreement with Belmont Partners, LLC by which Belmont acquired ninety-three million seven hundred fifty thousand (93,700,000) shares of the Company’s common stock.  The transaction closed on June 2, 2009.  Following the transaction, Belmont Partners, LLC controls approximately 92.25% of the Company’s outstanding capital stock. Additionally on May 13, 2009 Joseph Meuse was appointed to the Board of Directors as director, and as President and Secretary of the Company.  On the same date, John L. Corn and Susan E. Corn resigned from their positions as directors and/or officers of the company.

On June 4, 2009, Belmont Partners LLC (“Belmont”), the Issuer’s controlling shareholder, and Abacus Global Investments, Corp. (“Abacus”) entered into a material definitive agreement pursuant to which Abacus acquired all ninety-three million seven hundred fifty thousand (93,750,000) shares of the registrant’s common stock (representing 92.25% of the Company’s issued and outstanding stock) which was owned by Belmont.  The transaction closed on June 9, 2009.  Following the transaction, Abacus Global Investments, Corp. controlled 92.25% of the Registrants outstanding capital stock.  Additionally, effective June 9, 2009 Marius Silvasan was appointed as a director and as the interim President of the company. On the same date, Joseph Meuse resigned from his positions as P resident, Secretary and Director.

On June 9, 2009, the company filed an amendment to its Articles of Incorporation pursuant to which the Company’s name was changed to ONE HOLDINGS, CORP. (“ONE”). The Company also changed its registered address on the same day.

Upon Abacus’ acquisition of majority control of the Company and following the name change to ONE, Abacus changed the Company’s business focus to its current strategy.

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On July 22, 2009, the Company acquired from certain shareholders (“GP Shareholders”) of Green Planet Bioengineering Co., Ltd., a Delaware corporation (“Green Planet”) 80% of the issued and outstanding shares of common stock of Green Planet. The Company also acquired 5,101 shares of Green Planet preferred stock which preferred stock provides the Company the right to vote 1,000 votes on all matters submitted to a vote of the shareholders of Green Planet and is convertible into 1,000 shares of Green Planet common stock.  The Company acquired the Green Planet preferred stock in consideration for the issuance by the Company to Green Planet of 5,024,038 shares of the Company’s common stock.  As part of this Green Planet transaction, Green Planet and the GP Shareholders deposited into an Escro w thirty-five percent (35%) of the Company’s shares issued to Green Planet and the GP Shareholders and in the event Green Planet’s EBITDA for fiscal year 2009 is less than GP’s EBITDA for fiscal 2008, the number of shares of Registrant’s stock issued to Green Planet and the GP Shareholders shall be proportionately reduced as provided for in the Green Planet Preferred Stock Purchase Agreement (the “Preferred Stock Purchase Agreements”) and the Stock Purchase Agreement (“GP SPA”) with the GP Shareholders. Green Planet and the GP Shareholders are also subject to a lockup and leak out period and has one piggy-back registration right as further defined in the Green Planet Preferred Stock Purchase Agreement and GP SPA.  As a result of the Green Planet transactions, the Company has become the majority shareholder of Green Planet and based upon the number of shares outstanding and assuming conversion or the Green Planet preferred stock into common stock, the Company would own approximately 83% of Green Planet’s shares.  Green Planet owns 100% of FuJian Green Planet Bioengineering Co., Ltd., a WFOE, that through a series of contractual arrangements has effective control of the business and operations of and has an irrevocable option to purchase the equity and/or assets of Sanming Huajian Bio-Engineering Co., Ltd. (a PRC company), a green process manufacturer of high quality health supplements, organic fertilizers and pesticides.  Consequently, the Company effectively controls the business and operations of Green Planet, FuJian Green Planet Bioengineering Co., Ltd. (a GP WFOE) and Sanming Huajian Bio-Engineering Co., Ltd.

On September 3, 2009, ONE acquired from the shareholders of Trade Finance Solutions (“collectively referred to as “TFS Shareholders”) 3,990 shares representing 99.75% of the Shareholders’ common shares owned in Trade Finance Solutions Inc. (“TFS”). For the TFS shares each TFS Shareholder is to receive shares of the Registrant’s common stock and cash payments as per the Share Purchase Agreement with the TFS Shareholders (“TFS SPA”). The cash component of the purchase price will be calculated on an earn-out basis based on TFS’ monthly EBIT (earnings before interest and taxes) beginning with the measuring period as defined in the TFS SPA with a not to exceed purchase price of $6,000,000.00. In addition to the cash portion of the purchase price, the TFS Shareholders shall receive 1 share of ONE common stock (adjusted for forward or reverse splits following the closing) for every $1.00 in EBIT achieved during the measuring period (“TFS Stock Compensation”) subject to a maximum TFS Stock Compensation of 6 million shares of Registrant’s common stock. The TFS Shareholders are subject to a lockup and leak out period as further defined in the TFS SPA. Upon the purchase of the TFS Common Shares from the TFS Shareholders, Registrant has become the majority shareholder of TFS. TFS provides balance sheet financing solutions for domestic and international credit-worthy customers including accounts receivable, purchase order financing, fulfillment services and factoring or invoice discounting. The TFS acquisition is strategic to the Company beyond the direct and immediate financial contribution TFS will bring to sales and net income because it will provide the Company the ability to use TFS as an internal financing arm ready, able and dedicated to fund and facilitate the growth of the Company’s core bioengineering business.

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On September 27, 2009, the Company acquired through a variety of transactions, 83% control of Jianou Lujian Foodstuff Co., Ltd. (“JLF”), a company based in the Peoples Republic of China (“PRC”).  The Registrant executed and consummated a Share Exchange Agreement (the “Supreme Agreement”) by and among (i) the Company’s 100% owned subsidiary United Green Technology Inc., a Nevada corporation, (“UGTI”), (ii) Supreme Discovery Group Limited, British Virgin Islands Company  (“Supreme”) and (iv) the stockholders who owned 100% of  Supreme’s common stock (the “Supreme Shareholders”).  Supreme is the parent company of Fujian United Bamboo Technology Company Ltd., a wholly foreign-owned enterprise (“JLF WFOE”) organized under the laws of the PRC.  The stockholders of Supreme are Tang Jinrong, Li Lifang and Tang Shuiyou, who are also the owners of JLF. JLF WFOE through a series of contractual arrangements has effective control of the business and operations of and has an irrevocable option to purchase the equity and/or assets of JLF. Consequently, the Company effectively controls the business and operations of Supreme, JLF WFOE and JLF.

Pursuant to the Supreme Agreement, at the closing, the Supreme Shareholders sold, transferred and assigned 100% of the outstanding common stock of Supreme to the Company’s wholly-owned subsidiary UGTI in exchange for (i) cash, (ii) 13,760,000 shares of the Company’s common stock, and (iii) 20% of the issued and outstanding shares of common stock of UGTI.  The Company thereby acquired through UGTI ownership of all of the outstanding stock of Supreme which owns 100% ownership of JLF WFOE. As part of this transaction the Supreme Shareholders deposited into an Escrow thirty-five percent (35%) of the Company’s shares issued to them and in the event UGTI’s EBITDA for fiscal year 2010 is less than UGTI’s EBITDA for fiscal 2009, the number of shares of the Company’s stock issued to Supreme Sharehol ders shall be proportionately reduced as provided for in the Supreme Agreement. Supreme Shareholders are also subject to a lockup and leak out period and have one piggy-back registration right as further defined in the Agreement. JLF is an award winning green-technology bioengineering company that specializes in the production of organic products and fertilizers based on bamboo. JLF holds bamboo land contracts in Fujian Province, one of China’s largest bamboo growing areas.  JLF is the third largest bamboo producer in China and is the first bamboo company in China to gain food safety certification from China (HACCP), Japan (JAS) and Europe (ESFA). JLF was also the first company in China to formulate a “zero-to-zero” process starting from cultivation to distribution including the development of organic fertilizers from bamboo skins to eliminate waste.

Effective October 26, 2009, the Company amended its articles of incorporation to:  (i) authorize a class of preferred stock consisting of (10,000,000) shares, $0.001 par value per share; (ii) designating 10,000 shares of the preferred stock as Series A Preferred Stock; (iii) reducing the number of authorized shares of common stock from 750,000,000 shares to 150,000,000 shares and changing the par value to $0.001 per share; (iv) changing the name of the Registrant to ONE Bio, Corp.; and (v) effecting a Five (5) for one (1) reverse split of the registrant’s common stock.

On November 3, 2009, the Company and UGTI cancelled and replaced the UGTI Preferred Stock Purchase Agreement and entered into a Share Purchase Agreement (the “UGTI Share Purchase Agreement”).  Pursuant to the UGTI Share Purchase Agreement we agreed to purchase from UGTI and UGTI agreed to sell to us 10,000 shares of UGTI Common Stock in consideration for a cash payment of $1,200,000 which is payable $180,000 on May 10, 2010 and $1,020,000 on November 10, 2010.  As a result of the foregoing UGTI transactions, the Company is now 98% shareholder of UGTI.

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On  November 11, 2009, the Company filed an application to list its common stock on the NASDAQ Capital Market. The Company believes it currently fulfills or will shortly meet all  applicable  NASDAQ  Capital Market listing requirements. The Company’s listing application is  subject to review and approval by NASDAQ’s Listing  Qualifications Department for compliance with all NASDAQ Capital Market standards. The Company received notification on April 22, 2010, that their application had been approved to list on the NASDAQ Exchange.  NASDAQ has reserved ONBI as the trading symbol for the Company’s common stock

On January 8, 2010, the Company entered into a Securities Purchase and Registration Rights Agreement with certain institutional and accredited investors pursuant to which the investors purchased $3,000,000 in aggregate principal amount of our 8% Convertible Promissory Notes.  The Convertible Notes due on October 11, 2010, and are convertible at the elections of the Investors into shares of our Common Stock at an initial Conversion Price equal to shall be the lesser of (a) $6.077 per share, or (b) 65% of the price per share offered by the Company in any publicly offered Common Stock or other equity-linked financing by the Company that is closed within nine months of the Initial Closing (each, a “New Financing”). Pursuant to the SPA, we also issued to the Investors five (5) year warrants (“Warrants”) to purchase an aggregate of 49,366 shares of our Common Stock at an initial exercise equal to the lesser of (a) $6.077 per share, or (b) 65% of the price per share offered by us in any New Financing.

On September 1, 2009 the Company entered into a convertible note purchase agreement with its subsidiary Green Planet in the principal amount of $300,000.  The note carried interest at 10% per annum and has a conversion feature that allowed the Company to convert the loan into common stock.

In January 2010, the Company issued 10,000 shares of Series A Preferred Stock to the Chairman and CEO in the amount of 3,733 and 6,267 respectively.  This action, approved by the Board, was in consideration and recognition of the agreement by the executives to pledge 6,000,000 shares of common stock in satisfaction of the share pledge condition of the Bridge Loan Financing Agreement.  Holders of the Series A Preferred Stock shall be entitled to cast two thousand (2,000) votes for each share held of the Series A Preferred Stock on all matters presented to the shareholders of the Company for shareholder vote which shall vote along with holders of the Company’s common stock on such matters.

On April 14, 2010, the Company entered into a Share Purchase Agreement with Min Zhao (our director and president of our CHE business unit) (the “Selling Shareholder”) (the “Selling Shareholder SPA”), pursuant to which, among other things we acquired from the Selling Shareholder 1,632,150 shares of common stock of Green Planet owned by the Selling Shareholder in consideration for 1,300,000 shares of our restricted common stock.  The number of shares of our common stock issuable to the Selling Shareholder is subject to adjustment as set forth in the Selling Shareholder SPA.  As part of this transaction, the Selling Shareholder agreed to a lock-up and leak-out period as further defined in this agreement.  At the same time, we received from a certain Green Planet shareholder 1,216,184 s hares of common stock of Green Planet.  As a consequence of these transactions, we now own 92.5% of the outstanding common stock of Green Planet.

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Also on April 14, 2010, the Company entered into an agreement with Green Planet pursuant to which, among other things, (i) that certain Amended and Restated Green Planet Preferred Stock Purchase Agreement made effective as of June 17, 2009, between us and Green Planet (“Amended and Restated GP Preferred Stock Agreement”) was cancelled, (ii) we returned to Green Planet the 5,101shares of Green Planet preferred stock that were issued to us pursuant to the Amended and Restated GP Preferred Stock Agreement, and (iii) Green Planet returned to us the 1,004,808 shares of our common stock that we issued to Green Planet pursuant to the Amended and Restated GP Preferred Stock Agreem ent.

Additionally, on April 14, 2010, Green Planet granted to ONE an option to acquire 100% of the stock of Elevated Throne Overseas Ltd. (“Elevated throne”), Green Planet’s 100% owned BVI subsidiary.  In the event we exercise this option, the closing of the transaction will be subject to the approval of Green Planet’s stockholders.  As consideration for our exercise of this option, we will be required to (i) convert the $1,700,000 loan we made to Elevated Throne on or about January 19, 2010, into an equity investment in Elevated Throne, (ii) convert the $300,000 loan we made to Green Planet on or about September 1, 2009, into a $300,000 equity investment in Elevated Throne, (iii) cancel that certain Convertible Note Purchase Agreement between us and Green Planet dated on or about September 1, 200 9, and (iv) cancel that certain 10% Convertible Bridge Loan Note Due September 1, 2010, in the principal amount of $300,000 from Green Planet to us.

Business Overview

ONE Bio, Corp., is an award winning, innovative bio-engineering company that utilizes green process manufacturing to produce raw chemicals and herbal extracts, natural supplements and organic products. We are focused on capitalizing on the rapidly growing markets of the Asia-Pacific region. Our key products include Solanesol, widely recognized CoQ10, Resveratrol and 5-HTP, organic fertilizers, and organic bamboo health food and beverages. Our growth plan targets an aggressive acquisition driven strategy supported by organic growth of our operating units. Through ONE Bio, smaller private companies that we acquire are provided access to capital, experienced management and strategic insight. We strive to build synergies among all of our subsidiaries. We work with each subsidiary to promote organic and acquisition driven growth. We are com mitted to becoming a leader in bioengineering utilizing green processes, combining our experience in producing our chemical and herbal extract products with seasoned North American managerial expertise. Our operations are currently focused on the Asia-Pacific Region which currently generates approximately 95% of our revenue.

We are headquartered in Miami, Florida; however, our primary contractually controlled operating enterprises, Sanming and JLF are based in Sanming City and Jianou City, respectively, in the Fujian province of China.

Operational Summary

Our operations are divided into two principal complementary business units that focus on producing chemical and herbal extracts (our “CHE” business unit) and organic products utilizing green processes (our “OP” business unit). We also have an internal financing business unit, Trade Finance Solutions (“TFS”), that assists and supports the growth of our core bioengineering business units. We believe our internal financing business unit provides us an excellent opportunity beyond funding our core operations to also provide purchase order financing to third-party clients that purchase products from us. In this arrangement, our internal financing business unit can insert itself into the collection process, expediting cash flow and debt repayment for all parties ultimately driving our growth rate. We fund our internal financing business unit through the sale of debentures to institutional and high net worth investors that pay quarterly interest to investors solely from the interest and fees generated from the financing business unit’s activities. The debenture is secured by the assets of the internal financing unit with no recourse to our other assets.

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Because our CHE business unit was treated for accounting purposes as being acquired effective as of January 1, 2009, while our OP business unit and our financing business unit were treated for accounting purposes as having been acquired as of September 2009, during the fiscal year ended December 31, 2009, approximately 60% of our revenue came from our CHE business unit, approximately 28% came from our OP business unit and approximately 12% came from our financing business unit. However, if the full year 2009 revenues for each of our 3 business units were used, approximately 34% of our revenues would have come from our CHE business unit, approximately 48% from our OP business unit and approximately 18% from our financing business unit.

Green Planet and our CHE operating division

Our CHE business unit operates under the umbrella of our 100% owned subsidiary Elevated Throne Overseas Ltd., a British Virgin Islands Company (“Elevated Throne”).  Elevated Throne owns 100% of Fujian Green Planet Bioengineering Co., Ltd. (“Fujian GP”), which is a wholly foreign-owned enterprise (“WFOE”) organized under the laws of the Peoples Republic of China (the “PRC”). Fujian GP has entered into a series of irrevocable agreements with (i) Sanming Huajian Bio-Engineering Co., Ltd. (“Sanming”), a PRC company based in Sanming City in the Fujian province of China, which is licensed to operate its business in the PRC and (ii) the owners of Sanming. Pursuant to those irrevocable agreements, GP (through Fujian GP) contractually controls and operates Sanming, which is t he principle operating enterprise of our CHE business unit and which is located in PRC.

Sanming is a research & development company with a focus on improving human health through the development, manufacture and commercialization of bio-ecological products and over-the-counter products utilizing extractions from tobacco leaves. Sanming’s position in the bioengineering industry comes from its research & development which utilizes patented methods to create downstream products ranging from plant indigenous medicine and pharmaceutical intermediates to eco-friendly products. Since 2007, Sanming has developed a variety of natural organic products using tobacco leaves.

Our CHE business unit produces chemical and herbal extracts for use in a wide range of health and wellness products. Utilizing green technology and proprietary processes, this business unit extracts health supplements, fertilizers, and pesticides from waste tobacco. Our cost effective extraction process simultaneously extracts Solanesol and organic fertilizers from waste tobacco leaves. By extracting two products from a single extraction process, we believe we are able to generate higher margins than we would if we used a traditional single product fermentation extraction process. Additionally, we can further process the Solanesol to produce Coenzyme Q10 (“CoQ10”). Our CHE business unit also extracts from a variety of plants Resveratrol and 5-HTP, which are key components in many consumer health and wellness products.

We distribute our CHE products through established independent third party distributors which normally enter into renewable one-year distribution agreements with us. Our distributors are focused on the bio-health industry and raw chemical intermediates industry. This permits use to more accurately forecast sales and required production. In addition, feedback from our distributors provides us with good visibility on changes in consumer demand. Furthermore, we have established additional distribution channels, such as universities and hospital research centers. We are not substantially dependent on any of our distributors.

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The owners of Sanming (our contractually controlled PRC operating entity) are Min Zhao, Min Yan Zhen, and Jiangle Jianlong Mineral Industry Co. At the time of the transactions between Fujian GP and Sanming, the owners of Sanming were also the owners of Fujian GP. Thereafter, we acquired Fujian GP as part of our acquisition of Green Planet. Min Zhao is a member of our Board of Directors, a shareholder and President of our China operations. Mr. Zhao continues to act as the President and a shareholder of Sanming which he now operates on our behalf as our President of China Operations pursuant to the irrevocable agreements.

UGTI and our OP operating division

Our OP business unit operates under the umbrella of our 98% owned subsidiary United Green Technology Inc., a Nevada corporation (“UGTI”), which through its wholly owned subsidiary Supreme Discovery Group Limited, a British Virgin Islands company (“Supreme Discovery”), owns 100% of Fujian United Bamboo Technology Company Ltd. (“Fujian United”), which is a WFOE organized under the laws of the PRC. Fujian United has entered into a series of irrevocable agreements with (i) Jianou Lujian Foodstuff Co. (“JLF”), a PRC company based in Jianou City, in the Fujian province of China, which is licensed to operate its business in the PRC and (ii) the owners of JLF. Pursuant to those irrevocable agreements, UGTI (through Fujian United) contractually controls and operates JLF, which is the principle ope rating enterprise of our OP business unit and which is located in the PRC.

JLF is an award-winning green-technology enterprise that specializes in the production of organic products and fertilizers based on bamboo. JLF was also one of the first companies in China to formulate a “zero-to-zero” process. The “zero-to-zero” process begins with bamboo cultivation in the ground, proceeds through manufacturing of end products, and ends with the production of organic fertilizers from any remaining waste. We use bamboo shoots for food, the stalks are sold for use in construction materials, and any remaining waste is used to create organic fertilizers. Virtually everything grown is used in some way, reducing the need for fertilizers, cutting energy consumption, and reducing costs. Our OP business unit concentrates on processing bamboo shoots and bamboos which it sells domestically in China and e xports to other countries.

Our OP business unit manufactures a variety of consumer and commercial-use health and energy drinks, organic food products and fertilizers primarily based on bamboo. Organic food products based on bamboo are low in saturated fat, cholesterol and sodium, yet high in dietary fiber, vitamin C, potassium, zinc, and numerous other nutrients, making bamboo shoots popular for weight loss and maintaining a healthy lifestyle. Also, the Moso bamboo leaf extract, which contains soluble and insoluble fiber and antioxidants, is used to make a caffeine-free energy drink or is infused into white rice creating green bamboo rice with health benefits. Our OP business unit also uses bamboo skins to produce organic fertilizers, thereby substantially eliminating waste in the process.

Presently, our contractually controlled PRC operating entity, JLF, operates production lines to produce both 18L boiled bamboo shoot cans and boiled vegetable cans. The production capacity in 2008 reached 20,000 tons, an annual output value of RMB 120,000,000.00. This includes the production of 50 kinds of products, such as 18L boiled bamboo shoot cans, boiled bamboo shoot cans with vacuum packing, boiled mixed vegetables, boiled seasoned vegetables and Kamameshi (a Japanese rice dish), with a quality rating that meets national and international standards. The boiled bamboo shoots and mixed vegetables account for the majority of the products sold with approximately 80% of all products sold domestically and approximately 20% exported to other countries such as Japan, Southeast Asia, Europe and North America.

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We distribute our OP products directly to large supermarket chains , hotels, hospitals and restaurants. We also distribute our products through a network of independent third party distributors who enter into renewable one year distribution agreements with us. We are not substantially dependent on any of our distributors.

In order to harvest the benefits of integrating growing and profitable Chinese operating enterprises with the management and financial techniques available to North American enterprises, we adhere to a “Yin-Yang” management strategy based on the Chinese Philosophy of “Correlative Thinking.” The core components of this approach are: constructing a strong, balanced team; addressing the needs of investors; and realizing the importance of diversity. In practical terms, our strategy is to combine the manufacturing expertise and work ethic of the Eastern world with the investment experience and management skills of the best North American companies. Our team in China works together with our North American management to grow our core business, and provide transparency with an emphasis on risk management and internal co ntrols.

The owners of JLF are Jinrong Tang, Li Li Fang and Tang Shuiyou. Jinrong Tang is Vice President of our China Operations and a shareholder. At the time of the transactions between Fujian United and JLF, the owners of JLF were also the owners of Fujian United. Thereafter, we acquired Fujian United as part of our acquisition of Supreme Discovery. Mr. Tang continues to act as the President of JLF which he now operates on our behalf as our Vice President of China Operations pursuant to the irrevocable agreements. Jinrong Tang, Li Li Fang and Tang Shuiyou own the remaining 2% of the stock of our UGTI subsidiary.

TFS and our financing division

Our internal financing business unit operates under the umbrella of our 99.75% owned subsidiary TFS, an Ontario, Canada, company. TFS was established in 2006 to provide creative financing solutions, including purchase order financing, fulfillment services and factoring or invoice discounting for credit worthy customers of eligible goods and services. TFS has branch offices in Lima, Peru and Miami, Florida. TFS has a wholly owned subsidiary, TFP International Inc., a Florida corporation, which operates the Miami office.

TFS conducts a thorough review and due diligence examination of potential borrowers and the respective borrower’s customers before the particular transaction is approved. An analysis of each individual transaction also takes place through TFS’ credit approval process, in order to ensure that all parties in the transaction receive value, and that TFS will be re-paid according to the terms agreed to in the particular transaction. Security for the financing includes a first lien position on the receivables and assets of the client (UCC, PPSA), personal guaranty and credit insurance. In addition, 100% of TFS’ financing transactions are credit insured with large, multi-national insurance companies. In a typical financing transaction, a letter of credit will be utilized to provide all parties with the protections on agreed to delivery, quality and timelines. TFS’ clients are primarily small and medium size businesses registered and/or located in the United States and Canada, which export their products internationally. Through TFS we also offer purchase order financing to third-party clients that purchase products from our CHE business unit and our OP business unit to assist to assist in the collection process, and expedite cash flow and debt repayment.

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Our internal financing business unit offers the following types of financing: factoring or invoice discounting, where TFS, as factor, purchases the client’s credit insured receivables (i.e., invoices) for products or services satisfactorily rendered to creditworthy customers. By selling receivables to TFS, the client can generate cash almost immediately, instead of waiting the usual 30, 60, 90 days. TFS will verify, insure and control the transaction with the ultimate payer; purchase order financing (or PO Funding) which is a mechanism put in place to provide a short-term finance option to clients who have pre-sold finished goods and a requirement to pre-pay suppliers. All these OP Funding transactions are on a “per project” basis. Typically the client has a purchase order from a credit insured customer but does not h ave the capital to pay their supplier upfront. TFS typically requires that the client must have “pre-sold” the goods with strong profit margins. TFS utilizes Letters of Credit to purchase the goods from the supplier and protect all parties. Once the goods are accepted by the end customer, TFS then factors the invoice and pays off the purchase order facility; and fulfillment services, most of which are provided through TFP and which involves the goods being acquired by TFP on terms negotiated with both supplier and end-client. Here TFP has established credit insurance and marine cargo insurance policies. The customer provides the purchase order and sales contract to TFP, which completes the transaction and disburses the proceeds.

Historically TFS has funded its financing transactions through the sale of debentures to institutional investors and high net worth investors, often on an individual transaction basis. The debentures pay quarterly interest to the investors solely from the interest and fees generated from the financing activities. The debenture is secured by the assets of TFS with no recourse to other assets of ONE Bio. Through ONE Bio, TFS have greater access to capital to finance its business and through its association with our other business units, access to new international markets.

Results of Operations and Financial Condition

As a result of the reverse acquisition transaction with Green Planet BioEngineering, Ltd. (“GPB”) (“CHE”), discussed elsewhere in this interim report, although legally GPB was acquired by ONE, for accounting and financial reporting purposes, GPB was considered the accounting acquirer and therefore ONE is considered to be a continuation of GPB.  Our two other acquisitions that occurred in September 2009, Trade Finance Solutions (“TFS”) (‘Fin”) and United Green Technology, Inc. (“UGTI”) (“OP”) were accounted for as purchases. Accordingly, the information reported in our interim consolidated financial statements and in the following discussion and analysis of our operating results for the three months ended March 31, 2010 compared to the corresponding p eriods in 2009, include the operating results of GPB for the periods presented consolidated with the operating results of TFS and UGTI from their acquisition dates which are September 2, 2009 and September 27, 2009 respectively. As a result, the comparative numbers for March 31, 2009 include only GPB.  GPBTFS and UGTI’s operating units are CHE, the Financing unit, and the OP unit, respectively.

Three Months Ended March 31, 2010 versus March 31, 2009

Operating Revenues

The Company generated $11,162,507 of revenues from operations for the three months ended March 31, 2010 as compared to $2,297,621 from operations for the three months ended March 31, 2009, an increase of $8,864,886 or 385.8%. The increase in revenue is primarily the result of the acquisitions and organic growth strategies.

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Approximately $7.9 million of the increase in revenue is mainly due to the inclusion of revenues from the Company’s recently completed acquisition of the Financing unit and the OP unit, which contributed revenues of approximately $3.5 million and $4.5 million, respectively for the three months ended March 31, 2010.  The revenues from these acquisitions are only included from the date of their respective acquisitions both of which occurred in September of 2009 and as a result, revenues for March 31, 2009 are only from CHE.

Approximately $1.0 million of the increase in revenues is due to the increase in sales resulting from the continued focus on driving customer value through its core product lines. In addition, the company is positioned to take advantage of a shift in the product and customer mix combined with a broader product portfolio which has not contributed significantly to the increase in sales. The Company continues to experience an increase in demand for its core product portfolio and has increased the number of customers compared to prior periods.

Cost of Sales

Cost of sales from operations for the three months ended March 31, 2010 were $7,054,796 compared to $852,686 for the same period in 2009, resulting in an increase of $6,202,110 or 727.4%. The increase in cost of sales is primarily the result of the acquisition and organic growth strategies.

Approximately $5.6 million of the increase in cost of sales is due to the inclusion of costs from the Company’s recently completed acquisitions of the Financing unit and OP unit, which contributed costs of approximately $3.0 million and $2.6 million, respectively, for the three months ended March 31, 2010. The cost of sales from these acquisitions are only included from the date of their respective acquisitions both of which occurred in September 2009 and as a result, cost of sales for March 31, 2009 are only from CHE.

Approximately $0.6 million of the increase in cost is primarily related to the higher revenues, organically and a shift in raw material product mix in its core product lines. Increases in raw material costs drove an overall decrease in gross profit as a percentage of revenues.

It is significant to note that the recent acquisitions (the Financing unit and OP) have higher costs of sale which result in lower margins but operate with reduced operating expenses when compared to the other operating businesses.

Gross Profit

Gross profit from operations for the three months ended March 31, 2010 were $4,107,711 compared to $1,444,935 for the same period in 2009, resulting in an increase of $2,662,776 or 184.3%.  The increase in gross profit is primarily the result of the acquisition and organic growth strategies. Gross profit for March 31, 2009 is only from CHE.

Approximately $2.3 million of the increase in gross profit is due to the inclusion of gross profit from the Company’s recently completed acquisitions of the Financing and OP units, which contributed gross profit of approximately $0.5 million and $1.8 million respectively for the three months ended March 31, 2010. The acquisitions were overall accretive however; these acquisitions had the effect of reducing the consolidated gross profit as a percentage of revenues. This reduction occurs because each acquired entity individually generates a lower gross profit percentage than CHE. The individual gross profit percentages of CHE, OP and the Financing unit for the three months ended 2010 are 54.9%, 41.2% and 14.1%, respectively. While the recent acquisitions have lower gross margins, they also operate with lower expenses, which positiv ely contribute to the net income.

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Approximately $0.4 million of the increase in gross profit is primarily a result of CHE’s operating performance. Gross profit from CHE’s operations for the three months ended March 31, 2010 were $1,790,149 compared to $1,444,935 for the same period in 2009, resulting in an increase of 23.4%.  Correspondingly, gross profit for CHE as a percentage of revenues for the three months ended March 31, 2010 was 54.9% compared to 62.9% for the same period in 2009.  As previously discussed, the decrease is a result of increased raw material costs and the introduction of new products that are not currently produced in economic quantities.  Secondarily, we have not yet been able to pass along all of our production cost increases to our customers in the form of price increases.

Operating Expenses

Operating expenses for the three months ended March 31, 2010 were $1,214,869 as compared to $304,712 for the same period last year. This represents an increase of $910,157 or 298.7%. Operating expenses for March 31, 2009 consist only of expenses from CHE since the acquisitions were made at a later period. Operating expenses for CHE amounted to $556,498 for the three months ended March 31, 2010 compared to $304,712 for the same period last year. Operating expenses are comprised of general and administrative expenses, research and development and sales and marketing expenses. The decrease in selling and marketing expenses is due to a reversal of business tax on management fee in the amount of $237,912 pertaining to the OP division. The operating expenses for CHE, Financing unit and OP individually amount to $556,498, $284,431 and ($608), respectively. The selling and marketing expenses for CHE include advertizing and trade show expenses which totaled $122,018 for the three months ended March 31, 2010 in order to drive future sales and sales of new products. The main cost drivers for the company, besides advertizing and trade show costs, are personnel cost, travel costs, management cost, accounting and audit fees. Research and development (R&D) expenses totaled $60,388 and $36,466 for the three months ended March 31, 2010 and March 31, 2009, respectively. The increase in R&D expenses is due to a broader product line. The Company’s efforts to broaden and strengthen its product portfolio will continue, however, at a pace that is consistent with the economy and the increasing sales activities.

Operating Income

Operating income for the three months ended March 31, 2010 was $2,892,842 versus $1,140,223 which is an increase of $1,752,619 or 153.7%. The CHE business contributed $1,233,651 of the increase for an 8.2% organic growth over the prior year.  The OP and Financial units contributed $1,832,933 and $200,806, respectively, for the three months ended March 31, 2010. The Company continues to focus on the execution of its business plan and with the completed acquisitions of CHE, the Financing unit and OP unit, the company is positioned for continued organic growth among all product lines and subsidiaries.

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Financing and Other Income/Expenses

Financing expenses include interest expense on the Company’s various financial instruments. For the three months ended March 31, 2010 the Company recognized $3,838 in interest income from its various instruments. The Company’s interest and financing expenses for the three months ended March 31, 2010 amounted to $199,109. In addition, the Company recorded $164,129 for the period in other expenses pertaining to expenses for obtaining various loans.

Income before Income Taxes and Non-controlling Interests

For the three months ended March 31, 2010, income before income taxes and non-controlling interest was $2,533,442 versus $1,140,384, which is an increase of $1,393,058 or 122.2%. The increase is mainly due to the results of the additions of the Financing unit and OP unit. These units contributed for the three months ended March 31, 2010, $124,084 and $1,789,502, respectively. The income was reduced by expenses totaling $578,584 in the corporate unit. However, $236,737 of these expenses are non-cash impacting since these pertain to stock compensation and amortization of loan fees.

Provisions for Income Taxes

For the three months ended March 31, 2010, provisions for income taxes were $702,515 versus $297,659 for the same period last year, which is an increase of $404,856 or 136.0%. The increase is associated with the recent acquisitions completed in September 2009. The tax provision for the three months ended March 31, 2009 pertains only to the CHE business.

Non-controlling Interest

For the three months ended March 31, 2010, the non-controlling interest was $193,855 versus none the prior year period.  The non-controlling interest was created by ONE acquiring less than 100% interest in CHE, the Financing unit, and the OP unit.

Net Income

Net income for the three month ended March 31, 2010 was $1,637,072 compared to $842,725 for the same period last year, which is an increase of $794,347 or 94.3%. The increase was attributable to the organic growth of the CHE business and the acquisitions of the Financing and OP businesses.

Liquidity and Capital Resources

As discussed elsewhere in this document, the Company has implemented a two pronged strategy, which is:

● to encourage and support organic expansion within the enterprises it acquires and utilize synergies and economies of scale between the entities; and

● to identify and acquire accretive acquisition targets.

To be successful, each strategy requires adequate funding from available liquidity resources.  Accordingly, ONE has determined that its organic expansion strategy is first supported through organically generated cash flow and supplemented by available borrowing capacity depending on the requirements of the anticipated expansion project. Any liquidity organically generated in excess of reinvestment needs will be channeled to the accretive acquisition strategy or retained for future expansion projects.

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The Company had working capital of $12,890,857 as of March 31, 2010.  Our operating and capital requirements in connection with supporting our expanding operations and introducing new products have been and will continue to be significant to us. Although we are profitable, and have been profitable, for the three months ended March 31, 2010 and 2009, our growth strategy, which is initially focused on accretive acquisitions and organically expanding our product lines will require substantial capital which we may not be able to satisfy solely through our operations.

Based on our current plans for the next 12 months, we anticipate that additional revenues earned from our expanded product line and broadened distribution channels will be the primary organic source of funds for future operating activities in 2010. However, to fund continued expansion of our product lines and extend our reach to broader markets, including international markets, and to acquire additional entities, we may rely on bank borrowing, if available as well as capital raises.  The comments discussed below in “Cash Flows for the three months Ended March 31, 2010 compared to March 31, 2009” section address our organic cash resources and the relevant trends and drivers associated with those cash flows.

Financial Position

Total Assets - Our total assets increased $6,854,114 or 12.5% to $61,487,695 as of March 31, 2010 from $54,663,851 as of December 31, 2009 primarily as a result of a net increase in current assets.  (See cash flows from operating activities below for further discussion.)

There were no significant changes in long lived assets.

The changes in current assets and specifically cash are more fully discussed as follows:

Cash Flows for the Three Months Ended March 31, 2010 (“Q110”) compared to March 31, 2009(“Q109”)

Cash Flows from Operating Activities

Operating activities used net cash of $1,092,293 (Q110) and provided $441,881 (Q109).  A major component of net cash provided by operations was net earnings of $1,830,927 (Q110) and $842,725 (Q109).  Certain non-cash operating activities such as amortization, depreciation and share based compensation totaling $783,816 (Q110) and $81,532 (Q109) increased net income’s impact on net cash provided by operating activities to $2,614,743 (Q110) and $924,257 (Q109).  Of the $1,830,927 in net earnings for 2010, $944,658 was generated by us and the balance of $886,269, net of corporate expenses of $534,839 was generated by our acquired business units, OP and FIN. Our net earnings during the quarter of $944,658 represented a 101,933 or a 12.1% increase in our organic growth over the comparable quarter in 2009.   ;Our acquired business units, OP and FIN were fully contributing to our operational performance for the full quarter in 2010.

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Net cash provided by operations is also impacted by changes in our net working capital which increased $2,607,101 or 25.4% to $12,890,858 (Q110) from $10,283,757 (Q109).  Of the increase, $690,767 resulted from the Company’s individual net operational activities during the quarter.  The balance of $1,916,334 resulted from our acquired business units OP and FIN, net of corporate activities, which were fully contributing to our consolidated results in Q110 but were not yet acquired and accordingly not part of our consolidated results in Q109.  On a consolidated basis, the more significant changes in working capital components during Q110 are as follows:

● a $452,336 increase in accounts receivable used cash.  Our continuing CHE business unit provided $1,684,158 in cash from a decrease in trade receivables resulting from successful collections.  Our acquired business units OP and FIN used $2,136,494 in cash resulting from increased receivables associated with expanding sales;

● a $1,684,235 increase in prepaid and other assets used cash.  Our continuing CHE business unit used $187,414 in cash associated with the timing of normal business transactions.  Our acquired business units OP and FIN used $1,496,821 in cash primarily the result of a deposit given to a supplier to procure raw materials;

● a $2,817,575 increase in inventories used cash.  Our continuing CHE business unit used $147,893 primarily to increase inventory to meet the increase in demand.  Our acquired business units OP and FIN used $2,669,682 in cash to advance new products and meet anticipated demand.

● a $1,402,866 increase in accounts payable and accrued expenses provided cash.  Our continuing CHE business unit used $420,011 paying down its suppliers with the cash received from collecting its receivables.  Our acquired business units OP and FIN provided $1,822,877 in cash by increasing the financing supplied by its vendors in order to fund their inventory increases.

Cash Flows used in Investing Activities

Our investing activities provided $1,519,168 in net cash during the three months ended March 31, 2010. Net cash provided is composed of the following significant items:

● $1,747,275 in cash was provided by reducing the outstanding loans receivable in our FIN business unit.

● we purchased $228,107 in additional equipment to expand our capacity, substantially all of it generated by our CHE business unit.

Cash Flows from Financing Activities

Our financing activities provided net cash of $2,983,696 during the three months ended March 31, 2010.  The net cash provided was composed of the following significant items:

● $3,000,000 in proceeds from a bridge loan executed by our corporate headquarters.

● $586,023 in proceeds from bank loans

● ($342,327) in repayments of bank loans.

● ($180,000) in repayments of notes payable.

● ($80,000) expended to repurchase of common stock.

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Capital Stock and Debt Financing at March 31, 2010

Repurchase of Common Shares

During the quarter the Company repurchased 16,000 shares of its common stock from its executives in accordance with the executive compensation agreement.  The agreement calls for the repurchase of shares from the executives in lieu of compensation. The Company paid $80,000 or $5.00 per share.

Issuance of Common Shares for Services

During the quarter the Company issued 12,500 shares of its common stock to the independent directors valued at $37,500.  These shares were issued as compensation to the directors as per the director agreements. Additionally, the Company issued 7,906 shares of its common stock for consulting services.  The Company paid $18,000 for the services rendered.  The total of $55,500 was paid by the Company for services in the quarter ending March 31, 2010.

Issuance of Convertible Note

On February 11, 2010, the Company closed on $3,000,000 convertible debentures, plus warrants, to a group of private investors, less $67,500 in offering costs paid.  The notes bear interest at 8.0% annually with a maturity date nine (9) months from the closing.  At the holder’s option the notes are convertible into shares of the Company’s common stock equal in number to the amount determined by dividing note principal to be converted by the Conversion Price. The Conversion Price is $6.077.

The Company recorded $263,431 for warrants granted and $357,932 for the implied discount resulting from the conversion option.

Foreign Currency Translation

Two of the Company’s operating entities, Sanming Huajian Bio-Engineering Co., Ltd. and Jianou Lujian Foodstuff, Co. maintain their financial records in the functional currency of the People’s Republic of China, which is the “Renminbi” (RMB), the currency of the primary economic environment in which the entities operate.  Another of the Company’s operating entities, Trade Financial Solutions (“TFS”) maintain its financial records in the functional currency of Canada, the Canadian Dollar (“CAD”).   For financial reporting purposes, the financial statements are prepared using the functional currency RMB or TFS, which have been translated into United States dollars. Assets and liabilities are translated at the exchange rates at the balance sheet dates, revenue a nd expenses are translated at the average exchange rates and stockholders’ equity is translated at historical exchange rates. Any translation adjustments resulting are not included in determining net income but are included in foreign exchange adjustment to other comprehensive income, a component of stockholders’ equity.

Exchange Rates	3/31/2010	12/31/2009
Fiscal period/year end RMB: US$ exchange rate	6.84	6.83
Average period/yearly RMB: US$ exchange rate	6.84	6.83

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Subsequent Event

On April 19, 2010 the Company announced (i) the cancellation of the amended and restated Green Planet preferred stock purchase agreement, (ii) One returned to GP  the 5,101 shares of GP preferred stock, and (iii) GP returned to One the 1,004,807 shares of One common stock that had been issued.

On April 14, 2010, GP granted to ONE an option to acquire 100% of the stock of Elevated Throne Overseas Ltd. (“Elevated Throne”), GP’s 100% owned BVI subsidiary. In the event ONE exercises this option, the closing of the transaction will be subject to the approval of GP’s stockholders. Furthermore, as a result of this event and if the transaction is fully consummated, ONE will own 100% of Elevated Throne and its subsidiaries which constitutes essentially all former operations of Green Planet. Green Planet will remain a subsidiary of ONE and operate as a public shell corporation with the business purpose to acquire or merge with an existing business operation. Additionally, the Company announced the appointment of Jan Koe to the audit committee.

Significant Estimates

Critical accounting polices include the areas where we have made what we consider to be particularly subjective or complex judgments in making estimates and where these estimates can significantly impact our financial results under different assumptions and conditions.

We prepare our financial statements in conformity with accounting principles generally accepted in the United States of America. As such, we are required to make certain estimates, judgments and assumptions that we believe are reasonable based upon the information available. These estimates, judgments and assumptions affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the periods presented. Actual results could be different than those estimates

Recent Accounting Pronouncements

In August 2009, the FASB issued ASU 2009-05 which includes amendments to Subtopic 820-10, “Fair Value Measurements and Disclosures—Overall”. The update provides clarification that in circumstances, in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the techniques provided for in this update. The amendments in this ASU clarify that a reporting entity is not required to include a separate input or adjustment to other inputs relating to the existence of a restriction that prevents the transfer of the liability and also clarifies  that both a quoted price in an active market for the identical liability at the measurement date and the quoted price for the identical liability when traded as an asset in an active market when no adjustments to the quoted price of the asset are required are Level 1 fair value measurements. The guidance provided in this ASU is effective for the first reporting period, including interim periods, beginning after issuance.  The adoption of this standard did not have a material impact on the Company’s consolidated financial position and results of operations.

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In September 2009, the FASB issued ASU 2009-06, Income Taxes (Topic 740), “Implementation Guidance on Accounting for Uncertainty in Income Taxes and Disclosure Amendments for Nonpublic Entities”, which provides implementation guidance on accounting for uncertainty in income taxes, as well as eliminates certain disclosure requirements for nonpublic entities.  For entities that are currently applying the standards for accounting for uncertainty in income taxes, this update shall be effective for interim and annual periods ending after September 15, 2009. For those entities that have deferred the application of accounting for uncertainty in income taxes in accordance with paragraph 740-10-65-1(e), this update shall be effective upon adoption of those standards. The adoption of this standard is not expected to have an impact on the Company’s consolidated financial position and results of operations since this accounting standard update provides only implementation and disclosure amendments.

In September 2009, the FASB has published ASU No. 2009-12, “Fair Value Measurements and Disclosures (Topic 820) - Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)”. This ASU amends Subtopic 820-10, “Fair Value Measurements and Disclosures – Overall”, to permit a reporting entity to measure the fair value of certain investments on the basis of the net asset value per share of the investment (or its equivalent). This ASU also requires new disclosures, by major category of investments including the attributes of investments within the scope of this amendment to the Codification. The guidance in this Update is effective for interim and annual periods ending after December 15, 2009. Early application is permitted.The adoption of this standard is not expected to have an impact on the Company’s consolidated financial position and results of operations.

In January 2010, the FASB has published ASU 2010-01 “Equity (Topic 505)- Accounting for Distributions to Shareholders with Components of Stock and Cash—a consensus of the FASB Emerging Issues Task Force,” as codified in ASC 505,. ASU No. 2010-01 clarifies the treatment of certain distributions to shareholders that have both stock and cash components. The stock portion of such distributions is considered a share issuance that is reflected in earnings per share prospectively and is not a stock dividend. The amendments in this Update are effective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  Early adoption is permitted.  The adoption of this standard did not have an impact on the Company’s (consolidated) financial posi tion and results of operations.

In January 2010, the FASB has published ASU 2010-02 “Consolidation (Topic 810)- Accounting and Reporting for Decreases in Ownership of a Subsidiary—a Scope Clarification,” as codified in ASC 810, “Consolidation.” ASU No. 2010-02 applies retrospectively to April 1, 2009, our adoption date for ASC 810-10-65-1. This ASU clarifies the applicable scope of ASC 810 for a decrease in ownership in a subsidiary or an exchange of a group of assets that is a business or nonprofit activity. The ASU also requires expanded disclosures. The amendments in this Update are effective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  .  The adoption of this standard is not expected to have any impact on the Company’s consoli dated financial position and results of operations.

In October 2009, the FASB has published ASU 2009-13, “Revenue Recognition (Topic 605)-Multiple Deliverable Revenue Arrangements”, which addresses the accounting for multiple-deliverable arrangements to enable vendors to account for products or services (deliverables) separately rather than as a combined unit. Specifically, this guidance amends the criteria in Subtopic 605-25, “Revenue Recognition-Multiple-Element Arrangements”, for separating consideration in multiple-deliverable arrangements. This guidance establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (a) vendor-specific objective evidence; (b) third-party evidence; or (c) estimates. This guidance also eliminates the residual method of allocation and requires that arrangement consideration be alloca ted at the inception of the arrangement to all deliverables using the relative selling price method and also requires expanded disclosures. The guidance in this update is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. Early adoption is permitted. The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

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In October 2009, the FASB has published ASU 2009-14, “Software (Topic 985)-Certain Revenue Arrangements that Include Software Elements” and changes the accounting model for revenue arrangements that include both tangible products and software elements. Under this guidance, tangible products containing software components and nonsoftware components that function together to deliver the tangible product’s essential functionality are excluded from the software revenue guidance in Subtopic 985-605, “Software-Revenue Recognition”. In addition, hardware components of a tangible product containing software components are always excluded from the software revenue guidance.  The guidance in this ASU is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beg inning on or after June 15, 2010. Early adoption is permitted.  The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In December 2009, the FASB has published ASU 2010-16 ““Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets.” ASU No. 2009-16 is a revision to ASC 860, ���Transfers and Servicing,” and amends the guidance on accounting for transfers of financial assets, including securitization transactions, where entities have continued exposure to risks related to transferred financial assets. ASU No. 2009-16 also expands the disclosure requirements for such transactions. This ASU will become effective for us on April 1, 2010..  The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In December 2009, the FASB has published ASU 2010-17 Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities.” ASU No. 2009-17 amends the guidance for consolidation of VIEs primarily related to the determination of the primary beneficiary of the VIE. The adoption of this standard is not expected to have any impact on the Company’s consolidated financial position and results of operations.

In January 2010, the FASB has published ASU 2010-06 “Fair Value Measurements and Disclosures (Topic 820): - Improving Disclosures about Fair Value Measurements. ASU No. 2010-06 clarifies improve disclosure requirement related to fair value measurements and disclosures – Overall Subtopic (Subtopic 820-10) of the FASB Accounting Standards Codification. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosure about purchase, sales, issuances, and settlement in the roll forward of activity in Level 3 fair value measurements.  Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The amendments in this Update are e ffective for interim and annual periods ending on or after December 15, 2009, and should be applied on a retrospective basis.  The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial position and results of operations.

Other ASUs not effective until after December 31, 2009, are not expected to have a significant effect on the Company’s consolidated financial position or results of operations.

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Off-Balance Sheet Arrangements

Our financial statements include consolidated majority owned subsidiaries and consolidated VIE’s of which we are the primary beneficiary.

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

Market Risks

The Company operates in the United States and other countries that have their own currency.  This may cause the Company to experience and be exposed to different market risks such as changes in interest rates and currency deviations.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk.

                                Not Applicable

Item 4.  Controls and Procedures.

Disclosure Control and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in company reports filed or submitted under the Securities Exchange Act of 1934, or the “Exchange Act,” is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.  Disclosure controls and procedures include without limitation, controls and procedures designed to ensure that information required to be disclosed in company reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our chief executive officer as appropriate to allow timely decisions regarding disclosure.

The Company’s management with the participation of the Company’s Chief Executive Officer evaluated the effectiveness of the Company’s disclosure controls and procedures as of March 31, 2010.  Based upon this evaluation, the Company’s Chief Executive Officer concluded that the Company’s disclosure controls and procedures were effective and designed to ensure that material information required to be disclosed by the Company in the reports that if files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and regulations and accumulated and communicated to them as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate “internal control over financial reporting” as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.  Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and effected by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:

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

 ii. provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

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

As of March 31, 2010 and as reported in the 10-K filing, management used the framework set forth in the report entitled “Internal Control – Integrated Framework” published by the Committee of Sponsoring Organizations of the Tread way commission to evaluate the effectiveness of our internal control over financial reporting.  Based on its evaluation, management concluded that at March 31, 2010 there was a material weakness in internal control over financial reporting.  A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The Company’s material weakness in its internal control over financial reporting related to the monitoring and review of work performed in the preparation of audit and financial statements, footnotes, and financial data provided to the Company’s registered public accounting firm.  Management concluded that our financial disclosure controls and procedures were not effective due to the Company’s limited internal resources and lack of ability to have multiple levels of transaction review.  Through the use of external consultants and the review process, management believes that the financial statements and other information presented herewith are materially correct.  The lack of accounting staff results in a lack of segregation of duties necessary for an effective system of internal control.& #160; The material weakness identified did not result in the restatement of any previously reported financial statements for 2008 or any other related financial disclosure, nor does management believe that it had any effect on the accuracy of the Company’s financial statements for the current reporting period.

In order to mitigate this material weakness to the fullest extent possible, all quarterly and annual financial reports are reviewed by the Chief Executive Officer for reasonableness and all unexpected results are investigated.  At any time, if it appears that any control can be implemented to continue to mitigate such weakness, it is immediately implemented.  The Company is seeking a permanent placement for the Chief Financial Officer position.

During the most recently completed fiscal quarter, there has been no change in our internal control over financial reporting that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.

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Part II. OTHER INFORMATION

Item 1.                   Legal Proceedings

                                None

Item 2.                   Market for Common Equity and Related Stockholder Matters

None

Item 3.                   Defaults Upon Senior Securities

None

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

None

Item 5.                   Other Information

None

Item 6.                   Exhibits

 (a)                          Exhibits

31.1           Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2           Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

        32.1           Certification pursuant to 18 U.S.C. Section 1350

        32.2           Certification pursuant to 18 U.S.C. Section 1350

 (b)                          Reports on form 8-K

The Company filed the following report on Form 8-K during the quarter for which the report is filed.

1. Form 8-K filed on January 12, 2010 to announce the appointment to the Board of Directors Qingsheng Fan, James Fernandez, Jan Koe and Frank Klees.

2.  Form 8-K filed on January 19, 2010 announcing the initial closing of a securities purchase agreement (“SPA”) of the Company’s 8% convertible notes and the appointment of John Perkins to the Board of Directors.

3.  Form 8-K filed on January 25, 2010 announcing the appointment of American Stock Transfer as the transfer agent for the Company and changed the Company address to Aventura Florida.

4. Form 8-K filed on February 17, 2010 announcing the final closing of the SPA for $2.7m.

5. Form 8-K filed on April 19, 2010 announcing the signing of a Security Purchase Agreement to acquire 1,632,150 of Green Planet Bioengineering Co., Ltd. Stock in exchange for 1,3000,000 ONE common share increasing ONE’s ownership position in Green Planet to 92.5%.  The Company also announced the cancellation of the preferred stock agreement with GP and return of 1,004,808 shares of ONE common stock, along with an option to acquire from GP 100% of the common stock of Elevated Throne Overseas Ltd.  Additionally, the Company announced the appointment of Jan Koe to the Audit Committee.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized this 17th day of May, 2010.

	ONE Bio, CORP.
Date: May 17, 2010	By:	/s/ Marius Silvasan
		Marius Silvasan
		Chief Executive Officer

Date: May 17, 2010	By:	/s/ Cris Neely
		Cris Neely
		Chief Financial Officer

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