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
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Fiscal Quarter Ended: September 30, 2003
Commission File Number: 000-50005
TECHEDGE, INC.
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(Name of small business issuer as specified in its charter)
Delaware 04-3703334
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(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
3 Rolling Hill Road, Hampton Bays, New York 11946
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(Address of principal executive offices)
(631) 728-4164
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Issuer's telephone number, including area code
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(Former name, former address, and former fiscal year, if changed since
last report)
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. X Yes No
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 8,000,000 shares, as of
November 14, 2003.
Techedge, Inc.
FORM 10-QSB
Quarterly Period Ended September 30, 2003
INDEX
Item 1. Financial Statements....................................2
PART I. FINANCIAL INFORMATION....................................2
Notes To Financial Statements...........................................5
Item 2. PLAN OF OPERATIONS......................................6
Item 3. CONTROLS AND PROCEDURES.................................8
PART II ........................................................8
OTHER INFORMATION.......................................................8
Item 1. Legal Proceedings.......................................8
Item 2. Changes In Securities And Use Of Proceeds...............8
Item 3. Defaults Upon Senior Securities.........................8
Item 4. Submission Of Matters To A Vote Of Security Holders.....8
Item 5. Other Information.......................................8
Item 6. Exhibits And Reports On Form 8-K........................9
SIGNATURES ........................................................9
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
TECHEDGE, INC.
(A Development Stage Enterprise)
BALANCE SHEET
SEPTEMBER 30, 2003
(Unaudited)
ASSETS
CASH $ 1,976
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TOTAL CURRENT ASSETS $ 1,976
==================
LIABILITIES AND STOCKHOLDERS' DEFICIT
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $ 70,940
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TOTAL CURRENT LIABILITIES 70,940
STOCKHOLDERS' DEFICIT:
Common stock, $.0001 par value,
25,000,000 shares authorized,
8,000,000 shares issued and outstanding 800
Additional paid-in capital 3,400
Deficit accumulated during the development stage (73,164)
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TOTAL STOCKHOLDERS' DEFICIT (68,964)
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$ 1,976
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The accompanying notes are an integral part of the financial statements.
2
TECHEDGE, INC.
(A Development Stage Enterprise)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Period For the Period
For the Three Months For the Nine Months July 17, 2002 (Inception) July 17, 2002 (Inception)
Ended September 30, 2003 Ended September 30, 2003 To September 30, 2002 To September 30, 2003
------------------------ ------------------------ ------------------------ -------------------------
GENERAL AND ADMINISTRATIVE $ 1,540 $ 16,638 $ 56,440 $ 73,164
------------------------ ------------------------ ------------------------- -------------------------
NET LOSS $ (1,540) $ (16,638) $ (56,440) $ (73,164)
======================== ======================== ========================= ========================
Basic and diluted
loss per share $ (0.00) $ (0.00) $ (0.01) $ (0.01)
======================== ======================== ========================= ========================
Weighted average number of
shares outstanding 8,000,000 8,000,000 8,000,000 7,000,000
======================== ======================== ========================= ========================
The accompanying notes are an integral part of the financial statements.
3
TECHEDGE, INC.
(A Development Stage Enterprise)
STATEMENT OF CASH FLOWS
(Unaudited)
For the Period For the Period
For the Nine Months July 17, 2002 (Inception) July 17, 2002 (Inception)
Ended September 30, 2003 To September 30, 2002 To September 30, 2003
------------------------ ------------------------- -------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (16,638) $ (56,440) $ (73,164)
------------------------ ------------------------- -------------------------
Adjustments to reconcile net loss to
net cash used in operating activities:
Changes in assets and liabilities:
Accounts payable and accrued expenses 14,500 56,440 70,940
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TOTAL ADJUSTMENTS 14,500 56,440 70,940
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NET CASH USED IN OPERATING ACTIVITIES (2,138) - (2,224)
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NET DECREASE IN CASH (2,138) - (2,224)
CASH, BEGINNING OF PERIOD 4,114 4,200 4,200
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CASH, END OF PERIOD $ 1,976 $ 4,200 $ 1,976
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The accompanying notes are an integral part of the financial statements.
4
TECHEDGE, INC.
(A Development Stage Enterprise)
Notes To Financial Statements
(Unaudited)
NOTE 1. BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and the instructions to Form 10-QSB. Accordingly, they do not
include all information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments considered necessary for a fair presentation have been included.
Operating results for the three months ended September 30, 2003 are not
necessarily indicative of results that may be expected for the year ending
December 31, 2003. For further information, refer to the audited financial
statements and footnotes thereto included in the Company's Form 10-SB for year
ended December 31, 2002.
NOTE 2. ORGANIZATION AND NATURE OF OPERATIONS
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles which contemplates continuation of the
Company as a going concern. However, the Company has incurred significant losses
since inception resulting in a stockholders' deficit of ($68,964) and working
capital deficit of ($68,964) at September 30, 2003. In addition, the Company's
only assets is cash of $1,976. These factors raise substantial doubt about the
Company's ability to continue as a going concern. The accompanying financial
statements do not include any adjustments relating to the recoverability and
classification of recorded assets, or the amounts and classification of
liabilities that might be necessary in the event the Company cannot continue in
existence.
In view of these matters, the continued existence of the Company is dependent
upon its ability to meet its financing requirements and, ultimately, the success
of its planned future operations. There can be no assurance that the Company
will obtain the necessary financing nor that the planned future operations will
be successful.
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Item 2. PLAN OF OPERATIONS
The Company was originally formed as a Delaware Limited Partnership under the
name of BSD Development Partners, LTD. ("BSD") in 1997 for the purpose of
investing in the intellectual property of emerging and established companies.
BSD realized net proceeds of $1,319,500 from a private placement to accredited
investors in early 1998. In December 2000, BSD's partnership agreement was
amended to permit the general partner, in its sole discretion, to merge BSD into
a corporation. The Company was formed in July 2002 to serve as the vehicle for
this merger which was effected in September 2002. The Company has endeavored to
continue the business of BSD and sought to enhance the liquidity of the
securities owned by its investors by becoming subject to the reporting
requirements of the 1934 Act and by seeking to have its common stock traded on
the National Association of Securities Dealers Over the Counter Bulletin Board
("OTCBB"). While a broker/dealer has filed a Rule 211 application with the NASD
for trading purposes, such application as of November 14, 2003 has not cleared.
The Company might not be able to accomplish its plan. Any reference to the
Company herein shall, when the context requires, also include BSD.
The Company has sought to generate income and enhance its capital by investing
primarily in intellectual property of emerging and established companies. The
Company's primary strategy remains to purchase exclusive and non-exclusive
licensing rights to intellectual property that management believes has
application outside of such intellectual properties present area of utilization
as well as any operating assets necessary to exploit the intellectual property
rights. Thereafter, the Company may seek to re-sell, sub-license, or re-market
its rights to others or otherwise exploit such rights. Since the Company has not
yet identified any target companies, it cannot state how many potential
licensors may exist or what types of arrangements it may seek with these as yet
unidentified entities. The Company's intention is to utilize its management's
expertise in an effort to enhance its ability in identifying potential
licensors. However, no assurance can be given that management will be successful
in identifying such opportunities.
Intellectual property includes patents, trademarks, copyrights and trade
secrets. Management believes that many companies are exploring opportunities to
exploit their portfolios of intellectual property assets through licensing,
acquisition transactions and joint ventures as well as other types of strategic
alliances. Management believes that if the Company can demonstrate to the
intellectual property owner that it has an opportunity to successfully generate
revenues from exploiting the property, it may be able to acquire a license or
other interest therein. Management believes that, through its experience, it may
be able to identify valuable intellectual property assets not currently being
fully exploited. If and when it obtains the rights to the intellectual property,
Management believes the Company can successfully identify intellectual
properties suitable for the Company's plan and develop plans for their
exploitation that can be marketed to the property owner, i.e., a company with
technology is a specific area may have the potential to apply same to other
applications outside the primary area or industry. If the Company can
demonstrate that potential revenues may be generated through addition
applications of current technologies, the Company's ability to enter into
agreements may be enhanced. The Company will then negotiate agreements for the
exploitation of those property rights through sub-licensing, re-selling,
re-marketing or other types of strategic alliances
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There can be no assurance whatsoever that the Company's plans will prove to be
commercially feasible or acceptable, especially when taking into consideration
the fact that management of BSD previously dissipated substantially all of the
approximate $1,300,000 raised by it in 1998, endeavoring to accomplish the
objectives set forth herein.
Liquidity and Capital Resources
The Company has cash on hand of approximately $1,976 (as ofSeptember 30, 2003)
which represents the net remaining of the approximately $1,300,000 that was
raised in a private placement. Such assets are maintained in a checking account
and earn nominal interest. In the opinion of Management, these assets will not
be sufficient to enable the Company to continue to file periodic reports or pay
professional fees therefore until such time as it is able to acquire
intellectual property and/or generate revenues and/or raise funds through
further issuance of its securities and/or through any additional financing
through currently unidentified sources. The Company's auditors have included a
"going concern" opinion in their report on the Company's financial statements
contained in the Company's 10-SB Registration Statement which also contains a
Risk Factor number 3 entitled Independent Auditor's "Going Concern" Opinion to
which reference is made for a discussion of the significance of this
qualification.
Need for Additional Financing
The Company believes that its existing capital will be insufficient to meet the
Company's cash needs, including the costs of compliance with the continuing
reporting requirements of the Securities Exchange Act of 1934, as amended, for
the current fiscal year which should not exceed $50,000. The Company may rely
upon issuance of its securities to pay for the services necessary to meet
reporting requirements. If and when the Company acquires additional intellectual
properties, its cash needs may increase significantly and such cash might not be
available to the Company. The Company can not predict the cash requirements
associated with as yet unidentified intellectual property acquisitions.
Forward-Looking Statements
When used in this form 10-QSB, or in any document incorporated by reference
herein, the words or phrases "will likely result", "are expected to," "will
continue," "is anticipated," "estimate," "project," or similar expressions are
intended to identify "forward looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements are subject to
certain risks and uncertainties including changes in economic conditions in the
Company's market area, changes in policies by regulatory agencies, fluctuations
in interest rates, demand for loans in the Company's market area and
competition, that could cause actual results to differ materially from
historical earnings, if any, and those presently anticipated or projected. The
Company wishes to caution readers not to place undue reliance on any such
Forward- looking statements, which speak only as to the date made. The Company
wishes to advise readers that the factors listed above, or in its 10-SB
Registration Statement Risk Factor Section, could affect the Company's financial
performance and could cause the Company's actual results for future periods to
differ materially from any opinions or statements expressed with respect to
future periods in any current statements. The Company does not undertake, and
specifically disclaims any obligation, to publicly release the result of any
revisions which may be made to any forward-looking statements to reflect events
or circumstances after the date of such statements or to reflect the occurrence
of anticipated or unanticipated events.
7
Item 3. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Our management, under the supervision and with the participation of our chief
executive officer and chief accounting officer, conducted an evaluation of our
"disclosure controls and procedures" (as defined in the General Rules and
Regulations under the Securities Exchange Act of 1934 at Rules 13a-15 and
15d-15). Based on their evaluation, our chief executive officer and chief
accounting officer have concluded that as of the Evaluation Date, our disclosure
controls and procedures are effective to ensure that all material information
required to be filed in this Quarterly Report on Form 10-QSB has been made known
to them in a timely fashion.
There have been no significant changes (including corrective actions with regard
to significant deficiencies or material weaknesses) in our internal controls or
in other factors that could significantly affect these controls subsequent to
the Evaluation Date set forth above.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes In Securities And Use Of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission Of Matters To A Vote Of Security Holders
None during quarter ended September 30, 2003.
Item 5. Other Information
None
8
Item 6. Exhibits And Reports On Form 8-K
Exhibits
(a) Exhibits
31 302 Certification by President and Chief Executive Officer
32 906 Certification by President and Chief Executive Officer
(b) Reports on Form 8-K
None
SIGNATURES
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.
Date: November 19, 2003
/s/ Gregory A. Konesky
By:_________________________________
Gregory A. Konesky, President and
Chief Executive Officer
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