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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 10-QSB
|X| QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2006
|_| TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION PERIOD FROM ____ TO ___
COMMISSION FILE NO.: 000-50005
----------------
TECHEDGE, INC.
(Exact name of small business issuer as specified in its charter)
DELAWARE 04-37033348
(State of Incorporation) (IRS Employer Identification No.)
33 WOOD AVENUE SOUTH, 7F
ISELIN, NEW JERSEY 08830
(Address of Principal Executive Offices) (Zip Code)
Issuer's telephone number, including area code: (732) 632-9896
----------------
Check whether the issuer: (1) 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
|_|
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date: As of May 10, 2006, there were
82,455,000 shares of Common Stock outstanding.
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TABLE OF CONTENTS
PART I- FINANCIAL INFORMATION.................................................1
Item 1 Financial Statements................................................1
Item 2 Management's Discussion and Analysis or Plan of Operation...........7
Item 3 Controls and Procedures............................................10
PART II- OTHER INFORMATION...................................................11
Item 1 Legal Proceedings..................................................11
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds........11
Item 6 Exhibits and Reports on Form 8-K...................................11
PART I- FINANCIAL INFORMATION
ITEM 1. Financial Statements
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
-------------------------------------------------------
To the Board of Directors
Techedge Inc. and Subsidiaries:
We have reviewed the accompanying consolidated balance sheet of Techedge
Inc. and Subsidiaries (a Delaware corporation in the development stage) as of
March 31, 2006, and the related consolidated statements of operations and cash
flows for the three-month period ended March 31, 2006. These financial
statements are the responsibility of the company's management.
We conducted our review in accordance with the standards of the Public
Company Accounting Oversight Board (United States). A review of interim
financial information consists principally of applying analytical procedures and
making inquiries of persons responsible for financial and accounting matters. It
is substantially less in scope than an audit conducted in accordance with the
standards of the Public Company Accounting Oversight Board (United States), the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the accompanying financial statements for them to be in
conformity with accounting principles generally accepted in the United States of
America.
Lodi, New Jersey
May 8, 2006
1
TECHEDGE INC. AND SUBSIDIARIES
------------------------------
(A DEVELOPMENT STAGE COMPANY)
-----------------------------
CONSOLIDATED BALANCE SHEET
--------------------------
MARCH 31, 2006
--------------
ASSETS
------
CURRENT ASSETS
- --------------
Cash and cash equivalents $ 5,314
Accounts receivable, net of bad debt reserve of $39,294 55,094
Due from related parties 433,678
Prepaid consulting --
Prepaid expenses and other current assets 9,831
-----------
TOTAL CURRENT ASSETS 503,917
-------------------- -----------
PROPERTY AND EQUIPMENT, NET 60,728
- ---------------------------
OTHER ASSETS 1,657
-----------
TOTAL ASSETS $ 566,302
------------ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
- ----------------------------------------------
CURRENT LIABILITIES
- -------------------
Accounts payable and accrued expenses $ 1,404,441
Other Liabilities 105,663
Due to officers 874,442
-----------
TOTAL CURRENT LIABILITIES 2,384,546
------------------------- -----------
STOCKHOLDERS' EQUITY (DEFICIT)
- ------------------------------
Common stock, stated value $.0001, 100,000,000
shares authorized; 82,455,000 shares issued and
outstanding 8,246
Additional paid-in capital 6,692,379
Deficit accumulated during development stage (8,572,089)
Accumulated other comprehensive income 53,220
-----------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (1,818,244)
------------------------------------ -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 566,302
---------------------------------------------------- ===========
See notes to consolidated financial statements.
2
TECHEDGE INC. AND SUBSIDIARIES
------------------------------
(A DEVELOPMENT STAGE COMPANY)
-----------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
FOR THE PERIOD FROM
-------------------
SEPTEMBER 13, 2000
FOR THE THREE MONTHS ENDED ------------------
MARCH 31, (DATE OF INCEPTION) TO
--------------------------------- ----------------------
2006 2005 MARCH 31, 2006
------------ ------------ ---------------------
REVENUE $ -- $ 66,503 $ 1,537,958
- -------
Cost of sales -- 36,887 764,741
GROSS PROFIT -- 29,616 773,217
- ------------ ------------ ------------ ------------
COSTS AND EXPENSES
- ------------------
Cost of sales -- 36,887 764,741
Research and development -- 198,024 2,274,698
General and administrative (including share-based payment
of $168,542, $56,500 and $182,153, respectively) 269,840 438,060 6,539,898
Depreciation and amortization 6,539 19,072 347,912
------------ ------------ ------------
TOTAL COSTS AND EXPENSES 276,379 692,043 9,927,249
------------------------ ------------ ------------ ------------
(LOSS) FROM OPERATIONS (276,379) (625,540) (8,389,291)
- ---------------------- ------------ ------------ ------------
OTHER INCOME (EXPENSE)
- ----------------------
Loss from unconsolidated subsidiary -- -- (60,134)
Loss from disposal of subsidiary, net of tax (48,142) -- (48,142)
Sale of subsidiary's net operating losses -- -- 216,247
Gain (loss) on foreign currency -- -- 660
Interest income (expense), net -- 167 34,299
------------ ------------ ------------
TOTAL OTHER INCOME (EXPENSE) (48,142) 167 142,930
---------------------------- ------------ ------------ ------------
(LOSS) BEFORE CUMULATIVE EFFECT OF CHANGE IN
- --------------------------------------------
ACCOUNTING PRINCIPLE (324,521) -- (8,246,361)
--------------------
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
- -----------------------------------------
PRINCIPLE, NET OF TAX -- -- (324,167)
---------------------
NET (LOSS) (324,521) (625,373) (8,570,528)
- ---------- ------------ ------------ ------------
UNREALIZED GAIN (LOSS) ON FOREIGN CURRENCY
- ------------------------------------------
TRANSLATION, NET OF TAX -- -- (3,526)
----------------------- ------------ ------------ ------------
COMPREHENSIVE (LOSS) ($ 324,521) ($ 625,373) (8,574,054)
- -------------------- ============ ============ ============
LOSS PER COMMON SHARE, BASIC AND DILUTED ($ 0.00) ($ 0.01)
- ---------------------------------------- ============ ============
WEIGHTED AVERAGE COMMON SHARES
- ------------------------------
OUTSTANDING, BASIC AND DILUTED 82,455,000 80,148,571
------------------------------ ============ ============
See notes to consolidated financial statements.
3
TECHEDGE INC. AND SUBSIDIARIES
------------------------------
(A DEVELOPMENT STAGE COMPANY)
-----------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
FOR THE PERIOD FROM
-------------------
SEPTEMBER 13, 2000
FOR THE THREE MONTHS ENDED ------------------
MARCH 31, (DATE OF INCEPTION) TO
------------------------------- ----------------------
2006 2005 MARCH 31, 2006
----------- ----------- ----------------------
CASH FLOWS FROM OPERATING ACTIVITIES
- ------------------------------------
Net loss $ (324,521) $ (625,373) $(5,689,918)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 6,539 27,245 324,167
Loss on unconsolidated subsidiary -- -- 60,134
Provision for doubtful accounts -- -- 14,326
Loss on foreign currency translation -- -- (3,526)
Loss on sale of subsidiaries, net of tax 48,142 -- 48,142
Stock-based compensation 168,542 56,500 463,453
Changes in assets and liabilities:
Accounts receivable 25,731 (838) (55,094)
Due from related parties (173,935) 84,506 (433,678)
Prepaid expenses and other current assets 38,376 (3,393) (9,831)
Other assets 43,371 -- (1,657)
Accounts payable and accrued expenses 250,505 254,872 1,404,441
Other liabilities (136,187) (181,700) 105,643
----------- ----------- -----------
NET CASH USED IN OPERATING ACTIVITIES (53,437) (388,181) (6,160,096)
------------------------------------- ----------- ----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
- ------------------------------------
Investment in unconsolidated subsidiary -- -- (409,832)
Purchase of property and equipment (5,876) (16,663) (249,639)
----------- ----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (5,876) (16,663) (659,471)
------------------------------------- ----------- ----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
- ------------------------------------
Net proceeds from private placement of common stock -- 260,000 1,897,651
Repurchase of treasury stock -- -- (432)
Net proceeds from private placement of common stock -- -- 4,000,000
Net proceeds from officers' advances -- 127,500 874,442
----------- ----------- -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES -- 387,500 6,771,661
-----------------------------------------
EFFECT OF FOREIGN CURRENCY CONVERSION ON CASH 1019 -- 53,220
- --------------------------------------------- ----------- ----------- -----------
NET INCEASE (DECREASE) IN CASH (58,294) (17,344) 5,314
- ------------------------------
CASH AND CASH EQUIVALENTS - BEGINNING 63,608 54,876 --
- ------------------------------------- ----------- ----------- -----------
CASH AND CASH EQUIVALENTS - ENDING $ 5,314 $ 37,532 $ 5,314
- ---------------------------------- =========== =========== ===========
See notes to consolidated financial statements.
4
TECHEDGE INC. AND SUBSIDIARIES
------------------------------
(A DEVELOPMENT STAGE COMPANY)
-----------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
MARCH 31, 2006 AND 2005
-----------------------
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
- ------ -----------------------------------
The financial statements should be read in conjunction with a reading of
the Company's annual Report on Form 10-KSB for the fiscal year ended
December 31, 2005
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accounting principles applicable to
interim financial information and with the requirements of Form 10-QSB and
Item 310 of Regulation S-B of the Securities and Exchange Commission.
Accordingly, they do not include all of the information and footnotes
required by accounting principles generally accepted in the United States
of America for complete financial statements. Interim results are not
necessarily indicative of results for a full year. In the opinion of
management, all adjustments considered necessary for a fair presentation
of the financial position and the results of operations and cash flows for
the interim periods have been included.
NOTE 2 - ADOPTION OF NEW ACCOUNTING STANDARDS
- ------ ------------------------------------
On January 1, 2006, the Company adopted the provisions of Statement of
Financial Accounting Standards (SFAS) No. 123(R) "Share-Based Payment"
using the modified prospective application. The Company has been expensing
share based awards granted after January 1, 2003 under the provisions of
SFAS No. 123 "Accounting for Stock-Based Compensation". For the three
months ended March 31, 2006 and 2005, included in net loss is expense of
$168,542 and $56,500 after tax, respectively, of stock based compensation
related to stock options granted. If the Company had followed the fair
value recognition provisions of SFAS 123(R) for all outstanding and
unvested stock options and other stock-based compensation for the three
months ended March 31, 2005, there would have been no material impact on
the Company's financial statements.
NOTE 3 - LOSSES DURING THE DEVELOPMENT STAGE AND MANAGEMENT'S PLANS
- ------ ----------------------------------------------------------
Through March 31, 2006 the Company had incurred development stage losses
totaling $8,570,528, and net cash used in operating activities of
$6,160,096. At March 31, 2006, the Company had $5,314 of cash and cash
equivalents and $55,094 of net trade receivables to fund short-term
working capital requirements.
The Company's ability to continue as a going concern and its future
success is dependent upon its ability to raise capital in the near term
to: (1) satisfy its current obligations, (2) continue its research and
development efforts, and (3) successfully develop, deploy and market its
products on a wide scale.
5
TECHEDGE INC. AND SUBSIDIARIES
------------------------------
(A DEVELOPMENT STAGE COMPANY)
-----------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
MARCH 31, 2006 AND 2005
-----------------------
NOTE 4 - STOCKHOLDERS' EQUITY
- ------ --------------------
During the quarter ended March 31, 2006, the Company granted 2,701,000
stock option grants, of which 1,901,000 were fully vested, to certain
employees to purchase shares of the Company's common stock.
NOTE 5 - RELATED PARTY TRANSACTIONS
- ------ --------------------------
The Company records material related party transactions. The Company
incurs costs for certain administrative expenses from a company owned 100%
by the Company's CEO. Those charges are included in general and
administrative expenses. The Company also provides services to a related
party and those amounts are included in revenue.
The Company also purchases equipment used in Research and Development from
a company owned 100% by the Company's CEO.
The Company also engages in advances to and advances from related parties.
The advances have no stated terms of repayment and carry no interest.
Following is a summary of transactions and balances with affiliated
entities and related parties 2006 and 2005
Three Months Ended
March 31,
----------------------
2006 2005
--------- ---------
Revenues from related parties $ -- $ --
========= =========
Purchases and expenses from related parties $ 1,200 $ 2,400
========= =========
Due from related parties $ 433,678 $ 133,752
========= =========
Amounts due to officers consist of advances from the Company's CEO to fund
the Company's operations. It also includes compensation deferred by the
Company's CEO, CFO, CTO and COO. No written repayment agreements exist
with either officer. Amounts are unsecured, non-interest bearing and due
upon demand.
NOTE 6 - SUBSEQUENT EVENTS
- ------ -----------------
In April 2006, the Company entered into an agreement to acquire 100% of
issued and outstanding common stocks of China BioPharma Limited ("CBP"), a
Cayman Island company, which has majority ownership rights to Tianyuan
Bio-Pharmaceuticals Co., Ltd. This transaction is subject to the Chinese
government's final approval.
As a result of the aforesaid transaction, the Company issued 3,000,000
shares of restricted common stocks.
6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
NOTE REGARDING FORWARD-LOOKING STATEMENTS
You should read the following discussion together with the more detailed
business information and consolidated financial statements and related notes
that appear elsewhere in this report and in the documents that we incorporate by
reference into this report. This report may contain certain "forward-looking"
information within the meaning of the Private Securities Litigation Reform Act
of 1995. In some cases, you can identify forward-looking statements by our use
of words such as "may," "will," "should," "could," "expect," "plan," "intend,"
"anticipate," "believe," "estimate," "predict," "potential" or "continue" or the
negative or other variations of these words, or other comparable words or
phrases. This information involves risks and uncertainties. Our actual results
may differ materially from the results discussed in the forward-looking
statements. Factors that might cause such a difference include, but are not
limited to, those discussed in Part I, Item 1 of our annual report on Form
10-KSB under the caption "Business--Risk Factors," which annual report was filed
on March 28, 2006.
Unless the context requires otherwise, references to "we," "us," "our,"
"Techedge" and the "Company" refer to Techedge, Inc. and its consolidated
subsidiaries.
CRITICAL ACCOUNTING POLICIES
See "Summary of Significant Accounting Policies" in the Notes to Consolidated
Financial Statements December 31, 2005 in our annual report on Form 10-KSB filed
on March 28, 2006 for our critical accounting policies. These policies include
revenue recognition, determining our allowance for doubtful accounts receivable,
accounting for cost of revenue, valuation of long-lived assets and research and
development costs.
ADOPTION OF NEW ACCOUNTING STANDARDS On January 1, 2006, the Company adopted the
provisions of Statement of Financial Accounting Standards (SFAS) No. 123(R)
"Share-Based Payment" using the modified prospective application. The Company
has been expensing share based awards granted after January 1, 2003 under the
provisions of SFAS No. 123 "Accounting for Stock-Based Compensation". For the
three months ended March 31, 2006 and 2005, included in net loss is expense of
$168,542 and $56,500 after tax, respectively, of stock based compensation
related to stock options granted. If the Company had followed the fair value
recognition provisions of SFAS 123(R) for all outstanding and unvested stock
options and other stock-based compensation for the three months ended March 31,
2005, there would have been no material impact on the Company's financial
statements.
BUSINESS OVERVIEW
Techedge, Inc. ("Techedge"), is a mobile voice over Internet protocol, or VoIP,
solution provider. Techedge has developed "IP-PCS solution" that utilizes
Personal Handyphone System, or PHS, mobile telephone technology on an unlicensed
Personal Communication Service, or PCS, frequency for low-cost VoIP services.
On January 26, 2006, the Company announced its plans to re-position itself for
bio-pharmaceutical and other high growth opportunities in China, while looking
for strategic partners to carry out the commercialization of its unique and high
potential Mobile Voice over IP solutions.
In conjunction with the Company's re-positioning plans, On January 1, 2006, the
Company entered into an agreement to transfer ownership and assets of China
Quantum Communications, Inc. to a former employee. Under the agreement, the
Company will assume all the debts and liabilities that China Quantum
Communications, Inc (CQCI) has incurred through December 31, 2005. On February
27, 2006 the Company entered into an agreement to transfer ownership of its
Chinese subsidiary Zhejiang Guang Tong Wang Luo Co., Ltd (ZJQC) to third
parties.
7
On April 7, 2006, the Company signed a Definitive Agreement to acquire China
BioPharma Limited (CBP), a Cayman island Company, which has majority ownership
rights to Tianyuan Bio-pharmaceuticals Co. Ltd., based out of Zhejiang Province,
China, pending on the Chinese government's final approval. According to the
agreement, Techedge Inc. will acquire 100% of the outstanding capital stock of
CBP in exchange for 3,000,000 unregistered shares of Techedge's common stock to
be issued.
Techedge Inc. is a Delaware corporation. Techedge is headquartered in Iselin,
New Jersey, with subsidiaries in both the United States and China.
The following discussion should be read in conjunction with our condensed
consolidated financial statements and the notes thereto:
RESULTS OF OPERATIONS
REVENUES
As a result of the Company's re-positioning for bio-pharmaceutical opportunities
in China and its exit from value-added communications services in the U.S.,
there is no revenue in the 1st quarter of 2006.
Revenue was $66,503 in the 1st quarter of 2005. No customer represented more
than 10% of our total revenues for the 1st quarter of 2006 or 2005.
COMPREHENSIVE LOSS
Comprehensive loss decreased to $(324,521) in the 1st quarter of 2006 from
$(625,373) in the 1st quarter of 2005. The decrease in loss is due to an
decrease in general and administrative, and research and development expenses.
COST OF REVENUES AND GROSS MARGIN
There was no cost of revenue incurred in the 1st quarter of 2006 as the Company
had no revenue in the period.
The cost of revenues for the 1st quarter of 2005 was $36,887. The cost of
service revenues consists of costs primarily associated with network operations
and related personnel, telephony origination and termination services provided
by third-party carriers, and indirect costs associated with purchasing,
scheduling and quality assurance.
Gross margin for the 1st quarter of 2005 was $29,616.
RESEARCH AND DEVELOPMENT EXPENSES
The Company incurred no Research and development ("R&D") expenses in the 1st
quarter of 2006.
Research and development ("R&D") expenses for 2005 consist primarily of
personnel for system design, implementation, and testing, and equipment costs
associated with IP-PCS systems and solutions development. R&D expenses were
$198,024 in the 1st quarter of 2005. R&D costs, including software development
costs and system integration costs, were expensed as incurred.
8
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative ("G&A") expenses consist primarily of personnel and
related overhead costs for sales, marketing, finance, legal, human resources and
general management. Such costs also include sales commissions, trade show,
advertising and other marketing and promotional expenses.
G&A expenses decreased to $269,840 in the 1st quarter of 2006 from $438,060 in
the 1st quarter of 2005. The Company experienced significant decrease in
marketing, sales, and personnel expenses, as it exited from value-added
communications services in the U.S. The Company continues to incur significant
expenses in legal, accounting, finance, and SEC filing fees associated with
being a publicly traded firm. The Company anticipates that G&A expenses to
increase as it carries out its re-positioning plan for bio-pharmaceutical
opportunities in China.
OTHER INCOME (EXPENSE)
Other loss was $(48,142) incurred from the disposal of its CQCI subsidiary in
the 1st quarter of 2006 compared to an income of $167 in the 1st quarter of
2005.
INCOME TAXES
No tax provision has been recorded for 2006 or 2005, as a result of the
cumulative operating losses we have generated.
LIQUIDITY AND CAPITAL RESOURCES
CASH AND CASH EQUIVALENTS; WORKING CAPITAL DEFICIT. As of March 31, 2006, we had
cash and cash equivalents of $5,314 and a working capital deficit of
$(1,880,629), as compared to $63,608 and $$(1,818,844), respectively, at
December 31, 2005. The increase in our working capital deficit reflects a
decrease in current assets and an increase in current liabilities. Our current
liabilities of $2,384,546 include $874,442 in non-secured loans from and
deferred compensation due to the officers of the Company which are payable on
demand.
NET CASH PROVIDED BY OPERATING ACTIVITIES. Net cash used in operating activities
was $53,437 in the 1st quarter of 2006, as compared to net cash provided of
$388,181 in the 1st quarter of 2005.
NET CASH USED IN INVESTING ACTIVITIES. Net cash used in investing activities was
$5,876 in the 1st quarter of 2006, as compared to $16,663 in the 1st quarter of
2005.
NET CASH PROVIDED BY FINANCING ACTIVITIES. Net cash provided by financing
activities was $0 in the 1st quarter of 2006, compared to $387,500, including
$260,000 through issuance of common stock, and $127,500 from officers' advances
in the 1st quarter of 2005.
CAPITAL STOCK TRANSACTIONS. The Company issued no new capital stock in the 1st
quarter of 2006. On January 24, 2006, the Company granted 2,701,000 options, of
which 1,901,000 are fully vested, to purchase shares of common stock at an
exercise price of $0.52, to officers, employees and consultants of the Company.
CURRENCY EXCHANGE FLUCTUATIONS. For the purpose of funding operations of our
Chinese subsidiary, we have implemented simple currency hedging against
fluctuations in the Chinese Renminbi to United States dollar exchange rate.
NEED FOR CURRENT FINANCING. Our ability to continue as a going concern is
dependent upon our ability to raise capital in the near term to: (1) satisfy our
current obligations, and (2) continue our planned re-positioning for
bio-pharmaceutical opportunities in China. We do not have sufficient capital to
fund our operations at the current level unless we receive additional capital
either through external independent or related party funding, revenues from
sales, further expense reductions or some combination thereof.
9
SUBSEQUENT EVENTS
On April 7, 2006, the Company signed a Definitive Agreement to acquire China
BioPharma Limited (CBP), a Cayman island Company, which has majority ownership
rights to Tianyuan Bio-pharmaceuticals Co. Ltd., based out of Zhejiang Province,
China, pending on the Chinese government's final approval. According to the
agreement, Techedge Inc. will acquire 100% of the outstanding capital stock of
CBP in exchange for 3,000,000 unregistered shares of Techedge's common stock to
be issued.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements.
ITEM 3. Controls and Procedures
The Company, under the supervision and with the participation of its
management, including the Chief Executive Officer and the Chief Financial
Officer, evaluated the effectiveness of the design and operation of the
Company's "disclosure controls and procedures" (as defined in Rule 13a-15(e)
under the Securities Exchange Act of 1934 (the Exchange Act)) as of the end of
the period covered by this report. Based on that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that the Company's disclosure
controls and procedures are effective, in making known to them on a timely
basis, material information relating to the Company and the Company's
consolidated subsidiaries required to be disclosed in the Company's reports
filed or submitted under the Exchange Act. There has been no change in the
Company's internal control over financial reporting during the three months
ended March 31, 2006 that has materially affected, or is reasonably likely to
materially affect, the Company's internal control over financial reporting.
10
PART II- OTHER INFORMATION
ITEM 1. Legal Proceedings
From time to time, the Company may be subject to legal proceedings, which
could have a material adverse effect on its business. At March 31, 2006 and
through the date of this filing, the Company was not a party to any litigation
matter.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
On January 24, 2006, the Company granted 2,701,000 options, of which
1,901,000 are fully vested, to purchase shares of common stock at an exercise
price of $0.52, to officers, employees and consultants of the Company.
ITEM 6. EXHIBITS
The following exhibits are being filed herewith pursuant to Item 601 of
Regulations S-B:
10.1 Share Exchange Agreement, dated as of April 7, 2006, between
Techedge, Inc. ("Techedge"), and China Biopharma Limited (LBP), a
Cayman Islands company
31.1 Rule 13a-14(a)/15d-14(a) Certification, executed by Peter Wang,
Chairman of the Board of Directors and Chief Executive Officer of
Techedge
31.2 Rule 13a-14(a)/15d-14(a) Certification, executed by Ya Li, Chief
Financial Officer of Techedge
32.1 Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and
Section 1350 of Chapter 63 of Title 18 of the United States Code (18
U.S.C. 1350), executed by Peter Wang, Chairman of the Board of
Directors and Chief Executive Officer of Techedge
32.2 Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and
Section 1350 of Chapter 63 of Title 18 of the United States Code (18
U.S.C. 1350), executed by Ya Li, Chief Financial Officer of Techedge
11
SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
TECHEDGE, INC.
Date: May 11, 2006 By: /s/ Peter Wang
------------------------------------
Peter Wang
Chief Executive Officer
(Principal Executive Officer)
12
EXHIBIT INDEX
Exhibit No. Description of Exhibit
10.1 Share Exchange Agreement, dated as of April 7, 2006, between
Techedge, Inc. ("Techedge"), and China Biopharma Limited (LBP), a
Cayman Islands company
31.1 Rule 13a-14(a)/15d-14(a) Certification, executed by Peter Wang,
Chairman of the Board of Directors and Chief Executive Officer of
Techedge
31.2 Rule 13a-14(a)/15d-14(a) Certification, executed by Ya Li, Chief
Financial Officer of Techedge
32.1 Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and
Section 1350 of Chapter 63 of Title 18 of the United States Code (18
U.S.C. 1350), executed by Peter Wang, Chairman of the Board of
Directors and Chief Executive Officer of Techedge
32.2 Certifications required by Rule 13a-14(b) or Rule 15d-14(b) and
Section 1350 of Chapter 63 of Title 18 of the United States Code (18
U.S.C. 1350), executed by Ya Li, Chief Financial Officer of Techedge