ebig_10k.htm


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

———————
FORM 10-K
———————

þ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2011
 
OR
 
¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from N/A to N/A

Commission File Number:  0-52282

———————
EastBridge Investment Group Corporation
(Exact name of registrant as specified in its charter)
———————
 
Arizona
 
86-1032927
State of Incorporation
 
IRS Employer Identification No.

8040 E. Morgan Trail, Unit 18, Scottsdale, Arizona 85258
(Address of principal executive offices)

(480) 966-2020
(Registrant's telephone number)

Securities registered pursuant to Section 12(b) of the Exchange Act:
None

Securities registered pursuant to Section 12(g) of the Exchange Act:
Common Stock, no par value per share

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ¨ Yes  þ No
 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨ Yes  þ No
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ  No ¨
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o
 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. þ
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
 
Large accelerated filer  
o
Accelerated filer  
o
Non-accelerated filer   o Smaller reporting company   þ
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ¨ Yes  þ No
 
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter – $11,835,052 as of June 30, 2011.
 
State the number of shares outstanding of each of the issuer's classes of equity securities, as of the latest practicable date: As of March 27, 2012, there were 156,347,027 shares of common stock, no par value per share issued and outstanding and no preferred stock, no par value per share, issued and outstanding.
 
Documents Incorporated By Reference –None
 


 
 

 
EASTBRIDGE INVESTMENT GROUP CORPORATION
FORM 10-K ANNUAL REPORT
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2011
 
TABLE OF CONTENTS
 
      PAGE  
ITEM 1.
BUSINESS.
    4  
ITEM 1A. 
RISK FACTORS
    11  
ITEM 1B. 
UNRESOLVED STAFF COMMENTS
    19  
ITEM 2.
PROPERTIES.
    19  
ITEM 3.
LEGAL PROCEEDINGS
    19  
ITEM 4.
[REMOVED AND RESERVED]
    19  
ITEM 5.
MARKET FOR REGISTRANT'S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
    20  
ITEM 6.
SELECTED FINANCIAL DATA.
    21  
ITEM 7.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
    21  
ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    26  
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    26  
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
    26  
ITEM 9A.  
CONTROLS AND PROCEDURES
    26  
ITEM 9B.  
OTHER INFORMATION
    27  
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
    28  
ITEM 11.
EXECUTIVE COMPENSATION
    31  
ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
    32  
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.
    33  
ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
    34  
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
    35  
SIGNATURES
    37  
 
 
2

 
 
Cautionary Note Regarding Forward-looking Statements and Risk Factors
 
The Company's Form 10-K, any Form 10-Q or any Form 8-K of the Company or any other written or oral statements made by or on behalf of the Company may contain forward-looking statements which reflect the Company's current views with respect to future events and financial performance. The words "believe," "expect," "anticipate," "intends," "estimate," "forecast," "project," and similar expressions identify forward-looking statements.  All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new products, services, developments or industry rankings; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing.  Such "forward-looking statements" are subject to risks and uncertainties set forth from time to time in the Company's SEC reports and include, among others, the Risk Factors set forth under Item 1A below.
 
The risks included herein are not exhaustive. This annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other documents filed with the SEC include additional factors which could impact EastBridge Investment Group Corporation's business and financial performance. Moreover, EastBridge Investment Group Corporation operates in a rapidly changing and competitive environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors. Further, it is not possible to assess the impact of all risk factors on EastBridge Investment Group Corporation's business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
 
Readers are cautioned not to place undue reliance on such forward-looking statements as they speak only of the Company's views as of the date the statement was made.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
 
 
3

 
 
PART I
 
ITEM 1.
BUSINESS.
 
As used in this annual report, "we", "us", "our", "EastBridge", "Company" or "our company" refers to EastBridge Investment Group Corporation and, unless the context otherwise requires, all of its subsidiaries.
 
Overview
 
EastBridge Investment Group Corporation (formally ATC Technology Corporation) was incorporated in the State of Arizona on June 25, 2001.  The Company's principal activity through June 30, 2005 was to manufacture mobile entertainment products that provided a means to play video game consoles made by Sony, Microsoft and Nintendo in a customer's car, RV, SUV, van or boat with attachable viewing monitors.     
 
In 2005, EastBridge decided to exit the mobile video game market and dedicate its activities to providing investment related services in Asia, with a strong focus on high GDP growth countries, such as China.  EastBridge is initially concentrating its efforts in the Far East (Hong Kong, mainland China, Australia) and in the United States.  We provide consulting services to provide viable corporate infrastructure necessary for small to medium-size companies to obtain capital to grow their business.  EastBridge structures its clients as joint ventures, wholly owned foreign enterprises, or guaranteed return ventures, and assists them in locating investment banking, financial advisory and other financial services necessary to become public companies in the United States or find joint venture partners or raise capital to expand their businesses.  EastBridge locates consultants which assist with marketing, sales and strategic planning services for its clients to prepare them to enter the United States capital market.
 
EastBridge believes it is one of a small group of United States companies solely concentrated in marketing financial services to closely held small to mid-size Asian and American companies that require these services for expansion. In business sectors where EastBridge sees a unique opportunity for growth, EastBridge may form its own foreign subsidiaries with local partners to capture the opportunity.
 
EastBridge has formed three subsidiaries which have been consolidated with EastBridge from the date of formation.
 
Consulting Services
 
EastBridge maintains a company website at: www.EbigCorp.com, the contents of which are not a part of this filing. EastBridge's business plan is to provide financial structure planning and guidance for capital raising transaction, whether in the form of public offerings, joint ventures, or merchant banking, to small-to-medium-sized businesses in Asia and America.  The Company manages its clients’ investor relations services, public relations services, and gives advice on marketing, sales, and strategic planning. The Company provides its clients with valuable information about various U.S. stock markets, and their general entry requirements. The Company provides information about U.S. investors before its clients become reporting companies.  We also serve as consultants and advisors to these companies to obtain loans, find business partners, find merger candidates or assist with feasibility studies.
 
EastBridge's target clients are mostly in the Chinese territories and other Asian countries as well as the United States.  EastBridge searches for companies its management believes have viable business strategies which have potential for raising significant capital in U.S. markets.  Though we focus on opportunities that management believes will create value for both our shareholders and clients, we cannot provide any assurance that such opportunities will create value for our shareholders, or otherwise increase the value of their investment in the Company.
 
 
4

 
 
Our income is derived from the following:
 
 
Cash fees and stock equities in received as compensation from clients for our listing service;
 
Revenues from operating joint ventures with operating companies generating cash flows; and
 
Fees earned in providing bridge loans to small companies through U.S. lending sources.
 
Competition
 
At this time, Company management is unaware of any other companies that offer similar services to smaller companies with the same focus in Asia or in America but is aware that this service is presently provided by individuals on a piecemeal basis.  The Company believes that large investment firms cannot obtain the fees from smaller companies they are capable of generating from the larger Asian or American companies. Smaller consulting or investment companies may lack the resources to penetrate the barriers to raising capital because of geographical, political, linguistic, cultural, or economy-of-scale reasons. However, the major brokerage and financial service companies, as well as some smaller companies, have advertising and marketing capabilities which may be accessed by smaller Asian and American companies.
 
As higher returns on investment in Asia and in America become available, these returns will most likely attract new competitors.
 
Government Approval and Regulation of Industry
 
The Company faces risks posed by any adverse laws and regulations affecting our business or our clients and future treaties or regulations that may be enacted by the U.S. or foreign governments. In order to conduct our business, we are required to obtain some or all of the following licenses, approvals and/or concessions from each country we are in: business registration, tax certificate, right to conduct business certificate, employment approval, residency approval, asset appraisal, acquisition approval, import/export license and foreign remission approval. The list is subject to additions, depending on the particular business sectors we decide to enter. There is no assurance that we need to obtain all of the approvals and licenses above; nor is there a guarantee that we will obtain any of the approvals and licenses when we are required to do so.
 
We also are subject to potential U.S. regulations concerning the consulting services we are providing.  We are not registered as an investment adviser or investment company or banking institution, nor are we a registered broker-dealer.  In the event we are required to obtain any such registrations, it could prevent us from conducting our business.  However, in anticipation of our business development, we are moving in the direction of becoming a broker-dealer and obtaining the necessary licenses and government approvals to operate as a broker-dealer.
 
We are undergoing an audit by the Internal Revenue Service related to employment tax liability for the 2006-2008 tax years, and depending on the outcome of the audit, we may be subject to additional taxes.  An assessment of additional taxes plus penalties and interest may have a material adverse effect on our performance.
 
 
5

 

Business Strategies
 
Our primary business strategy is to provide consulting services and to use our extensive network of Chinese and U.S. contacts to locate investment and merchant banking companies, business consultants, marketing firms, investor and public relations firms, appropriate exchanges, markets and market makers, attorneys and accountants capable of helping emerging growth Asian and American companies develop the infrastructure and expertise to (i) obtain access to private and public U.S. capital markets; (ii) expand their businesses in both their native Asian market and the U.S. market (if viable for export); and (iii) develop capital through fund capital raising and expansion. Our target clients are mostly in China, Hong Kong, Australia and in the United States.  We focus on high growth companies where the expected return can be realized within a one to two year period and the potential gain is substantial for us and our clients. We generally seek transactions in which substantial opportunities exist for business growth. Keith Wong (President and Chief Executive Officer of EastBridge) and Norman Klein (Principal Financial Officer of EastBridge) each have over twenty years of experience in the industrial, sales and financial industries. Mr. Wong is fluent in both Mandarin and Cantonese and is able to overcome cultural barriers as a result of having lived and worked for many years in both China and the U.S.  Our management has the background to understand a client's business quickly and is able to take fast and decisive actions to achieve business opportunities for our clients due to our smaller size. We plan for China, Australia, Hong Kong and the United States to continue to be our immediate focus in 2012. We offer U.S. companies the opportunity to expand into the Chinese market.  EastBridge’s Beijing office will assist U.S. companies to execute distribution and/or manufacturing agreements or other joint venture partnerships to distribute and/or manufacture their products and/or services in China.
 
We currently have ten (10) clients that we are assisting with becoming listed on a U.S. stock exchange or over-the-counter (OTC) market and/or obtaining a joint venture partner in the Far East and/or introducing the client to a broker/dealer or investment banker which helps them raise working capital for business expansion.  For the clients that want to become listed in the U.S., we are assisting the clients and their investment bankers, attorneys and accountants with the auditing and legal processes to register with the U.S. Securities and Exchange Commission (the “SEC”) and help locate broker dealers to begin trading their stock on a United States stock market or exchange.  Management anticipates, but can provide no assurances, that some of these clients will go public in the United States and begin trading their stock in 2012. EastBridge clients normally become public companies in the U.S. by conducting a direct registration process with the SEC.  However, some find a U.S. “shell’ company and conduct a reverse merger.  EastBridge has three (3) non-operating subsidiaries that could be used for a reverse merger. Once a client is registered as a public company and its stock begins trading in the U.S., EastBridge records the value of its stock in that client as revenue for that quarter and also records the value as an asset on its balance sheet.   We typically receive a 10% to 20% equity position in a client as consideration for our services along with cash consulting fees.
 
Overview of Current Clients and Subsidiaries:
 
We provide consulting services through our agreements to the clients set forth below:
 
Wonder International Education and Investment Group Corporation/Wenda Education

Wonder offers professional and vocational educational programs to assist post junior high and high school students to improve their skills for higher paying jobs. Wonder offers programs mainly in the computer related IT sectors such as network design, hardware technology, computer graphics, CAD, animation, network database and network security.  Wonder filed a Form S-1 registration statement with the SEC on December 9, 2009, which was declared effective by the SEC on January 6, 2011.  Wonder's PCAOB-registered accounting firm has recently completed its fieldwork for its 2011 audit and we plan to assist Wonder with its 10-K (annual report) filing for 2011.  We are assisting Wonder in seeking a listing for its common stock on the OTC markets in the near future.  EastBridge received 3,400,000 shares of Wonder common stock for its consulting services in March.  We declared a stock dividend on these Wonder shares for our EastBridge shareholders of record on July 31, 2009.  This dividend stock was distributed to our shareholders on a pro-rata basis in 2011. 899,975 shares have been distributed to our shareholders as of December 31, 2011.
 
 
6

 

Tsingda Education Company

Tsingda provides tutoring and education services to elementary, junior high and high school students in China.  We consulted with Tsingda in connection with its audit, its merger into a Cayman Island shell, a private placement capital raise of $9.6 million, and the legal process for its registration with the SEC. We are currently assisting Tsingda with its proposed public capital raise and listing on AMEX.  Tsingda’s initial registration statement on Form S-1 and its secondary registration statement for its PIPE investors were declared effective on March 4, 2011. Tsingda’s PCAOB auditor has completed its 2010 audit and Tsingda has filed its first 10-K annual report. Tsingda used Maxim Group LLC, a New York based investment banker, for its private placement during the fall of 2010.  EastBridge introduced Tsingda to Maxim and assisted Tsingda with preparing for the capital raise process. For EastBridge’s services, we received a cash fee and we received 2,079,740 shares of Tsingda common stock in 2010.  EastBridge declared a stock dividend on these Tsingda shares to its shareholders of record on March 15, 2010.  300,018 shares have been distributed to our shareholders as of December 31, 2011. Another 113,478 shares were distributed to service providers and investors as of December 31, 2011.

On December 14, 2011, EastBridge entered into a Stock Purchase Agreement with An Lingyan, an individual residing in the People’s Republic of China. Pursuant to the Agreement, the Company sold 500,000 ordinary shares of Tsingda to An Lingyan in exchange for a cash payment of $600,000.
 
AREM Pacific Corporation

Arem Pacific is in the real estate development and hospitality business.  Arem purchased a real estate development company in 2010 and plans to purchase property in China and Australia.  Arem is also exploring opportunities in the marine, hotel and entertainment industries of Australia and China.  Arem is currently working on its 2010 and 2011 audit with a PCAOB audit firm from the United States.  Eastbridge has a listing agreement with Arem and we are assisting Arem with its audit and with the SEC legal process to begin reporting as a U.S. public company.  Eastbridge will also assist Arem with locating an investment banker for a capital raise in the near future.  For its services, Eastbridge has received a cash fee in 2010 and we own an equity position in Arem.

Following is a history of our relationship with Arem:
 
During July 2007, we organized Nanotec, Inc. ("Nanotec") a wholly owned subsidiary of EastBridge.  On July 11, 2007, we distributed 5% of Nanotec’s equity to our shareholders of record on that date.  As of November 8, 2007, Arem Wines, a manufacturer of fine wines in Australia, merged with Nanotec, Inc.  Under the terms of the merger, the new stock ownership structure is as follows:  15% owned by EastBridge, 5% owned by EastBridge shareholders, and 80% owned by Arem Wines' beneficiaries.  The name of the merged company was Arem Group, Inc.  During 2008, Arem Group signed a Listing Agreement with Eastbridge to take its U.S. subsidiary public in the U.S. and to list it on a U.S. stock exchange.

As of September 2008, the Arem Group has been dissolved.  A new company called Arem Pacific Corporation was formed with a new set of directors and officers along with a new ownership structure.  EastBridge continues to own an equity position in Arem Pacific Corporation and EastBridge’s shareholders continue to own 5% of this new entity due to the stock dividend declared on July 11, 2007.  Eastbridge shareholders will receive a pro-rata share of the Arem equity once it has an effective registration statement in place.  We have not distributed any stock as of December 31, 2011.
 
 
7

 

Hangzhou Dwarf Technologies Ltd.

Dwarf Technologies is an internet services company in China.  EastBridge signed a listing agreement on July 26, 2010 with Dwarf.  EastBridge has consulted with Dwarf on its 2009 and 2010 audit, which was conducted by a PCAOB audit firm, and with SEC legal process to file a registration statement and begin reporting as a U.S. public company. Dwarf filed its first registration statement in August, 2011.  We intend to further consult with Dwarf with its listing process on a U.S. stock exchange or over-the-counter (OTC) market once it becomes a reporting company.  For its services, EastBridge receives cash fees and an equity position in Dwarf of 15%.  We received 3 million shares of Dwarf in August, 2011.  To date, we have received a down payment of the cash fees owed to us for our services.   We have  declared a stock dividend (300,000 shares) to our shareholders with a record date of November 30, 2011.  This dividend stock will be distributed after Dwarf receives SEC clearance.

LongWen Meda Holding Cororation

LongWen is a holding company with two manufacturing subsidiaries, located in Hangzhou, China. The holding company is engaged in the multi-media business. The manufacturing subsidiaries are in the piping/faucets/valve manufacturing business.  EastBridge signed listing agreements with the holding company and the subsidiaries in September, 2011.  EastBridge is assisting LongWen with its 2010 and 2011 audits which are being conducted by a PCAOB firm.  EastBridge will also assist LongWen with its SEC legal process to file a registration statement and begin reporting as a U.S. public company.  We will also assist LongWen with their listing process on a U.S. stock exchange or over-the-counter (OTC) market once it is cleared by the SEC.  For its services, EastBridge will receive cash fees and an equity position in LongWen of 25%.  EastBridge will receive its shares before LongWen’s first registration statement is filed with the SEC.  As of December 31, 2011, we have not declared a stock dividend to our shareholders for LongWen.

Alpha Lujo, Inc.

Alpha Lujo, Inc. is listed on the Over the Counter Bulletin Board (OTCBB – “ALEV”).  EastBridge assisted Alpha Lujo’s management with the purchase of its initial “shell” company, called E-Global Marketing, which was listed on the OTCBB.  EastBridge also assisted in the eventual name change of the company to Alpha Lujo, Inc. and we are assisting them with a merger of an Australian company in the electric vehicle business.  For its services, Eastbridge received 2,142,350 shares of Alpha Lujo common stock in December 2010.  These shares of Alpha Lujo will be distributed to our shareholders on a pro-rata basis once the merger with the Australian company is complete.  As of December 31, 2011, we have not distributed Alpha Lujo stock to our shareholders.

Alpha Green Energy Company

On February 19, 2009, we entered into a listing agreement with Alpha Green Energy Company, a company based in Phoenix, Arizona.  Alpha Green is a holding company that owns a subsidiary in Guizhou, China.  The subsidiary’s main business is electricity production using renewable bio-mass from the agricultural industry in China.
 
 
8

 
 
In September 2009, Alpha Green purchased Fiber One, our subsidiary in Hong Kong, for a cash fee. Alpha Green has filed a Form S-1 to become a public company in the United States, which included an audit for fiscal years 2007 and 2008.  Alpha Green is currently developing a new business model and strategy.   We are currently working with a PCAOB-registered accounting firm and with Alpha Green to complete their 2010 and 2011 audit report including financials and footnotes.  For its services, EastBridge will receive a cash fee plus an equity position in Alpha Green if and when it gets listed on a U.S. stock exchange or over-the-counter market.  We have received a down payment of the cash fee for the purchase of Fiber One by Alpha Green and for our consulting services.  Eastbridge will receive the balances of the cash fees for its services and for the purchase of Fiber One along with an equity position if and when Alpha Green is listed on a U.S. stock exchange or over-the-counter market.  EastBridge declared a stock dividend of the Fiber One shares to our EastBridge shareholders of record on of June 11, 2007.  Since 95% of the outstanding Fiber One stock was purchased by Alpha Green, the stock dividend will now apply to Alpha Green stock.
 
EastBridge will also assist in locating an investment bank to conduct a capital raise for Alpha Green.  As of December 31, 2011, we have not issued any Alpha Green stock to our shareholders for the stock dividend declared for our EastBridge shareholders.  We will issue Alpha Green shares to our shareholders on a pro-rata basis if and when Alpha Green's registration statement is declared effective by the SEC.

Fizza, LLC

Fizza, LLC is a U.S. based beverage company that provides a healthy beverage option for school aged children in U.S. schools.  Eastbridge is assisting Fizza in finding broker dealers and venture capitalists to help Fizza raise capital to complete product approvals and to startup its production process.  EastBridge assisted in providing “seed capital” to Fizza to help it obtain FDA approval of its product.   EastBridge has and will receive consulting cash fees along with an equity position in Fizza for its services.

International Air Medical Services, Inc (IAMS)

IAMS is an air ambulance company located in Scottsdale, Arizona.  IAMS provides long range jets to help transfer patients from one city to another.  EastBridge signed a consulting agreement in the fall of 2011 to assist IAMS in raising capital to expand its business by opening regional offices in other parts of the country.  EastBridge has also signed listing and joint venture agreements with IAMS to assist IAMS in becoming a public company in the U.S. and obtain a listing on an over-the-counter (OTC) market.  EastBridge intends to assist IAMS to expand its business into the Far East by finding a joint venture partner.  We are currently looking for investors who will provide the capital needed for IAMS to expand its business and fund its working capital.  We are also preparing IAMS for its 2010 and 2011 audit, which will be conducted by a PCAOB auditor.  We will also consult with IAMS on its SEC legal process and its filing of a registration statement with the SEC in the near future.  For our consulting services, we will receive cash fees and an equity position in IAMS of up to 10%.  We will receive shares of IAMS stock before the first filing of its registration statement.

Cambium

EastBridge signed a Consulting Agreement with Cambium Learning Group, Inc., a NASDAQ listed company, in May, 2011.  Cambium is a K-12 education company providing a suite of on-line education products.  EastBridge will assist Cambium in finding a joint venture partner in the Far East to help them expand their business in Asia.  For its services, EastBridge will receive a consulting cash fee.
 
 
9

 

American C&D Logistics and PhotoFunds (new clients – subsequent events)

EastBridge signed Listing Agreements with American C&D Logistics, LLC and PhotoFunds, Inc in March, 2012.  American C&D is a construction material recycling company, located in Philadelphia, PA.  PhotoFunds provides photography services to U.S. schools and is located in New Jersey.  EastBridge will also consult with the companies on their SEC legal process and registration filings with the SEC.  Finally, EastBridge will assist both companies with obtaining a listing on an over-the-counter (OTC) markets.  For its services, EastBridge will receive consulting cash fees and an equity position (10%) in both companies.  EastBridge is expected to receive stock in each company before the first registration statement is filed with the SEC.

Other EastBridge Clients

Our written listing agreements with the following companies have expired beginning in 2008 and continuing through January 1, 2011: Dafeng, Kaida, Huang Wei,  Ning Guo, Tianjin Heavy Steel, Beijing Power Company, Ginko, HaoHei Media, Ji-Bo, Aoxing,  Yewo, JKZ, Strayarrow, Long Whole Enterprises, and Golden Eagle Automobile Dealerships.  We continue to communicate with these companies and intend to re-initiate our agreements with them in the future.  However, we have postponed our services for an indefinite period of time and there is a possibility that we will not provide any further consulting services to these companies.  .  No fees were returned by EastBridge to these clients as part of the termination of these agreements or the postponement of us providing services under our listing agreements with them.

EastBridge Subsidiaries in the United States

General Farms Corporation (EastBridge Subsidiary)
 
On November 27, 2007, we organized General Farms Corporation ("General Farms") as a wholly owned subsidiary of EastBridge. A stock dividend of 5% of General Farm's common stock, or 10,000,000 shares, was declared for EastBridge's shareholders of record as of November 16, 2007, such dividend. General Farms owns no assets and conducts no business operations of its own.
 
Energy Corporation (EastBridge Subsidiary)
 
On November 27, 2007, we formed Energy Corporation ("Energy") as a wholly owned subsidiary of EastBridge.  On December 28, 2007, EastBridge announced that it would distribute a stock dividend of 5% of Energy Corporation's common stock of 10 million shares, on a pro-rata basis to its shareholders; however, no stock has been distributed to our as of December 31, 2011. Energy owns no assets and conducts o business operation of its own.
 
China Properties Corporation (EastBridge Subsidiary)
 
On November 27, 2007 we formed China Properties Corporation ("China Properties") as a wholly owned subsidiary of EastBridge.  We declared a stock dividend to distribute 5% of China Properties' common stock of 10,000,000 shares, on a pro-rata basis to our shareholders of record on November 30, 2007. The eligible shareholders will automatically receive the stock certificates or electronic deposits into their accounts if and when the China Properties' stock is listed and begins trading.  China Properties is presently and always has been an inactive subsidiary.  As of March 31, 2011, no stock has been distributed to our shareholders for this subsidiary for the declared stock dividend for those EBIG shareholders of record on November 30, 2007.
 
 
10

 
 
Employees
 
We now have two full-time employees in the United States and one full time employee in China.  In the next twelve months, we plan to expand to two full-time employees in Beijing, China and three full-time employees in Phoenix, Arizona.  To keep our fixed costs low, we generally subcontract our legal, accounting, audit and paralegal work to outside professional firms. We currently have more than six professional firms on retainer with us. We also have several business agents who work on commission basis in China and the U.S.  We also have a contractor working for us out of our U.S. office.
 
WHERE YOU CAN FIND MORE INFORMATION
 
You are advised to read this Form 10-K in conjunction with other reports and documents that we file from time to time with the SEC. In particular, please read our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K that we file from time to time. You may obtain copies of these reports directly from us or from the SEC at the SEC's Public Reference Room at 100 F. Street, N.E. Washington, D.C. 20549, and you may obtain information about obtaining access to the Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov.

ITEM 1A.
RISK FACTORS

The Company's Auditors Have Expressed Doubt About Our Ability To Continue As A Going Concern
 
The independent auditor's report on our financial statements contains explanatory language that substantial doubt exists about our ability to continue as a going concern. The report states that we depend on the continued financial contributions of our executive officers and their ability to execute our business strategy and to generate liquidity from our client engagements. If we are unable to obtain sufficient additional financing in the near term, achieve profitability or achieve client listing obligations, then we would, in all likelihood, experience severe liquidity problems and may have to curtail our operations. If we curtail our operations, we may be placed into bankruptcy or undergo liquidation, the result of which will adversely affect the value of our common shares.

We May Be Subject to U.S. Regulation of the Consulting Services We Provide
 
Even though we do not raise any capital for our clients, our services may be viewed as providing investment services.  Investment businesses generally are comprehensively and intensively regulated under state and federal securities laws and regulations.  Any investigation, litigation or other proceeding undertaken by the SEC or other federal or state regulatory agencies or private parties could necessitate the expenditure of material amounts of Company funds for legal and other costs and could have other materially adverse consequences for the Company, particularly if the Company is subject to fines and penalties for failure to obtain the required licenses or approvals.
 
The Company is not registered as a broker or dealer under the Exchange Act or any other securities law.  The Company believes that it is not required to be registered as a broker or dealer, but if the SEC or the securities administrator of any state were to assert that such registration is required, the Company would bear the resulting increased expenses and its activities would be restricted, which could materially and adversely affect the Company's business.
 
 
11

 
 
The Company has not, and is not expected to, register as an investment adviser or an investment company under the federal Investment Advisers Act of 1940, as amended, the federal Investment Company Act of 1940, as amended, or under the laws of any state.  The Company does not believe that any law requires such a registration.  However, particularly with respect to the method it has established of forming wholly owned subsidiaries and taking equity in all of the clients these practices may inadvertently violate the Investment Company Act of 1940 which would require extensively more filings and additional compliance with SEC regulations.  If required, however, such a registration could preclude the Company from performing its duties to its clients, which could lead to material adverse effects on the Company and its business, making its business less lucrative.
 
The Company may also be subject to the federal or various state investment advisory acts.  The services rendered by the Company may be viewed as providing financial advice even though management believes that any financial advice is not actually provided by the Company but instead is provided by third party financial service firms which are registered.

Competition May Negatively Impact Us
 
We will compete with individuals and both large and small investment companies for clients in Asia and our other current and proposed markets.  Many of these institutions and individuals are already active in the Asian and American markets and have greater financial and other resources that may be used to compete against us. We expect that, if we are successful and if our  markets as a whole have favorable results, competition will increase.
 
We Depend Upon Key Management Personnel and the Loss of Any of Them Would Seriously Disrupt Our Operations
 
The success of our company is largely dependent on the personal efforts of Keith Wong and Norm Klein. The loss of the services of Keith Wong or Norm Klein or other key executives would have a material adverse effect on our business and prospects. The Company has not obtained key-man insurance for any of its senior management personnel, which means that the Company will not receive any cash amounts as a result of the disability or death of a member of senior management.  In addition, in order for us to undertake our operations as contemplated, it will be necessary for us to locate and hire experienced personnel who are knowledgeable in our business. Our failure to attract and retain such experienced personnel on acceptable terms will have a material adverse impact on our ability to grow our business.
 
Our sole directors and officers have employment agreements which only permit their removal for cause or by mutual agreement of the officer and the Company.  As there are no independent directors it will be very difficult to remove either Mr. Wong or Mr. Klein, even if cause exists.

The Company Does Not Provide Proprietary Services
 
There is nothing proprietary about the services the Company provides and the Company has no intellectual property or other protection for its services. Any of the Company’s current or future competitors could duplicate the Company’s business model and it would have no legal recourse against them for such actions.

We Are Currently Being Audited
 
We are undergoing an audit by the Internal Revenue Service related to employment tax liability for the 2006-2008 tax years, and depending on the outcome of the audit, we may be subject to additional taxes, penalties and restrictions on further business activities or how we account for them.  An assessment of additional taxes plus penalties and interest may have a material adverse effect on our performance.
 
 
12

 

Our Common Stock Is Subject To Penny Stock Regulation
 
Our common stock, which is currently quoted for trading on the OTCBB and the OTCQB, may be considered to be a “penny stock” if it does not qualify for one of the exemptions from the definition of “penny stock” under Section 3a51-1 of the Exchange Act, as amended.  Our common stock may be a “penny stock” if it meets one or more of the following conditions: (i) the stock trades at a price less than $5 per share; (ii) it is not traded on a “recognized” national exchange; (iii) it is not quoted on the Nasdaq Capital Market, or even if so, has a price less than $5 per share; or (iv) is issued by a company that has been in business less than three years with net tangible assets less than $5 million.  The principal result or effect of being designated a “penny stock” is that securities broker-dealers participating in sales of our common stock will be subject to the “penny stock” regulations set forth in Rules 15-2 through 15g-9 promulgated under the Exchange Act.  For example, Rule 15g-2 requires broker-dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document at least two business days before effecting any transaction in a penny stock for the investor’s account.  Moreover, Rule 15g-9 requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor.  This procedure requires the broker-dealer to: (i) obtain from the investor information concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii) above; and (iv) receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor’s financial situation, investment experience and investment objectives.  Compliance with these requirements may make it more difficult and time consuming for holders of our common stock to resell their shares to third parties or to otherwise dispose of them in the market.

We Do Not Intend To Pay Cash Dividends.
 
We do not anticipate paying cash dividends on our common stock in the foreseeable future. We may not have sufficient funds to legally pay dividends. Even if funds are legally available to pay dividends, we may nevertheless decide in our sole discretion not to pay dividends. The declaration, payment and amount of any future dividends will be made at the discretion of the Board of Directors, and will depend upon, among other things, the results of our operations, cash flows and financial condition, operating and capital requirements, and other factors our Board of Directors may consider relevant. There is no assurance that we will pay any dividends in the future, and, if dividends are declared, there is no assurance with respect to the amount of any such dividend.

Because Our Stock Is Quoted On The OTCBB And OTCQB, Our Shareholders May Have Difficulty Selling Their Stock Or Experience Increased Negative Volatility On The Market Price Of Our Stock.
 
Our common stock is listed on the OTCBB and OTCQB. The OTCBB and QTCQB are often highly illiquid, in part because they do not have a national quotation system by which potential investors can follow the market price of shares except through information received and generated by a limited number of broker-dealers that make markets in particular stocks. There is a greater chance of volatility for securities that trade on the OTCBB and OTCQB as compared to a national exchange or quotation system. This volatility may be caused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrative supervision of bid and ask quotations, lower trading volume, and market conditions. Our shareholders may experience high fluctuations in the market price and volume of the trading market for our securities. These fluctuations, when they occur, have a negative effect on the market price for our securities. Accordingly, our shareholders may not be able to realize a fair price from their shares when they determine to sell them or may have to hold them for a substantial period of time until the market for our common stock improves.
 
 
13

 

Failure To Achieve And Maintain Effective Internal Controls In Accordance With Section 404 Of The Sarbanes-Oxley Act Could Have A Material Adverse Effect On Our Business And Operating Results.
 
It may be time consuming, difficult and costly for us to develop and implement the additional internal controls, processes and reporting procedures required by the Sarbanes-Oxley Act. We may need to hire additional financial reporting, internal auditing and other finance staff in order to develop and implement appropriate additional internal controls, processes and reporting procedures.
 
If we fail to comply in a timely manner with the requirements of Section 404 of the Sarbanes-Oxley Act regarding internal control over financial reporting or to remedy any material weaknesses in our internal controls that we may identify, such failure could result in material misstatements in our financial statements, cause investors to lose confidence in our reported financial information and have a negative effect on the trading price of our common stock.
 
In connection with our on-going assessment of the effectiveness of our internal control over financial reporting, we may discover "material weaknesses" in our internal controls as defined in standards established by the Public Company Accounting Oversight Board, or the PCAOB. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. The PCAOB defines "significant deficiency" as a deficiency that results in more than a remote likelihood that a misstatement of the financial statements that is more than inconsequential will not be prevented or detected.
 
In the event a material weakness is identified, we will attempt to employ qualified personnel and adopt and implement policies and procedures to address any material weaknesses we identify. However, the process of designing and implementing effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company. We cannot assure you that we will have the resources to be able to take steps to attempt to remedy any future material weaknesses or that the measures we will take will remediate any material weaknesses that we may identify or that we will implement and maintain adequate controls over our financial process and reporting in the future.
 
Any failure to complete our assessment of our internal control over financial reporting, to remediate any material weaknesses that we may identify or to implement new or improved controls, or difficulties encountered in their implementation, could harm our operating results, cause us to fail to meet our reporting obligations or result in material misstatements in our financial statements. Any such failure could also adversely affect the results of the periodic management evaluations of our internal controls and, in the case of a failure to remediate any material weaknesses that we may identify, would adversely affect the annual management reports regarding the effectiveness of our internal control over financial reporting that are required under Section 404 of the Sarbanes-Oxley Act. Inadequate internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock.
 
We Have A Limited Operating History And Lack Of Profits Which Could Lead To Wide Fluctuations In Our Share Price. The Market Price For Our Common Shares Is Particularly Volatile Given Our Status As A Relatively Unknown Company With A Small And Thinly Traded Public Float.

The market for our common shares is characterized by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue to be more volatile than a seasoned issuer for the indefinite future. The volatility in our share price is attributable to a number of factors. First, as noted above, our common shares are sporadically and thinly traded. As a consequence of this lack of liquidity, the trading of relatively small quantities of shares by our shareholders may disproportionately influence the price of those shares in either direction. The price for our shares could, for example, decline precipitously in the event that a large number of our common shares are sold on the market without commensurate demand, as compared to a seasoned issuer which could better absorb those sales without adverse impact on its share price. Secondly, we are a speculative or "risky" investment due to our limited operating history and lack of profits to date. As a consequence of this enhanced risk, more risk-adverse investors may, under the fear of losing all or most of their investment in the event of negative news or lack of progress, be more inclined to sell their shares on the market more quickly and at greater discounts than would be the case with the stock of a seasoned issuer. Many of these factors are beyond our control and may decrease the market price of our common shares, regardless of our operating performance. We cannot make any predictions or projections as to what the prevailing market price for our common shares will be at any time, including as to whether our common shares will sustain their current market prices, or as to what effect that the sale of shares or the availability of common shares for sale at any time will have on the prevailing market price.
 
 
14

 
 
Shareholders should be aware that, according to SEC Release No. 34-29093, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (1) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (2) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities. However, the occurrence of these patterns or practices could increase the volatility of our share price.

The Company’s Profitability May Be Negatively Impacted Because A Majority Of The Company’s Assets Are Comprised Of Securities That Are Not Highly Liquid.

A majority of the Company’s assets are comprised of securities received by the Company as part of its compensation for services rendered and are not highly liquid. There is presently no public market in the majority of the securities that the Company holds, and it is uncertain if such securities will be listed on a securities exchange or if a market for such securities will ever develop. There is no assurance that an alternative exit strategy will be readily available for the Company to realize the fair value of such securities.  Accordingly, we are prepared to bear the economic risk of such securities for an indefinite period of time.

Compensating the Company’s officers may incentivize them to take additional risk in an attempt to increase the value of the Company’s stock.
 
Due to the Company's lack of cash flows, it has historically compensated its officers in stock rather than paying a cash salary.  By compensating these officers in stock, we believe they have a greater incentive to take steps to increase the value of the Company's stock than they would if compensated in cash.  As the Company's value is largely based on the value of the equity it receives from its clients, paying the officers using Company stock may incentivize them to take additional risks in an attempt to increase the value of the Company's stock.
 
There could be changes in the policies of the PRC government that may adversely affect our business.
 
Each industry in the People's Republic of China ("PRC") is subject to policies implemented by the PRC government. The PRC government may, for instance, impose control over aspects of our clients' or our business such as distribution of raw materials, product pricing and sales. On the other hand, the PRC government may also make available subsidies or preferential treatment, which could be in the form of tax benefits or favorable financing arrangements.
 
If the raw materials used by our clients or their products become subject to any form of government control, then depending on the nature and extent of the control and our clients' ability to make corresponding adjustments, there could be a material adverse effect on our business and operating results.
 
Separately, our business and operating results also could be adversely affected by changes in policies of the Chinese government such as: changes in laws, regulations or the interpretation thereof; confiscatory taxation; restrictions on currency conversion, imports on sources of supplies; or the expropriation or nationalization of private enterprises. Although the Chinese government has been pursuing economic reform policies for approximately two decades to liberalize the economy and introduce free market aspects, there is no assurance that the government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption, or other circumstances affecting China's political, economic and social life.
 
 
15

 

Certain political and economic considerations relating to the PRC could adversely affect our company.
 
The PRC is passing from a planned economy to a market economy. The Chinese government has confirmed that economic development will follow a model of market economy under socialism. While the PRC government has pursued economic reforms since its adoption of the open-door policy in 1978, a large portion of the PRC economy is still operating under five-year plans and annual state plans adopted by the government that sets down national economic development goals. Through these plans and other economic measures, such as control on foreign exchange, taxation and restrictions on foreign participation in the domestic market of various industries, the PRC government exerts considerable direct and indirect influence on the economy. Many of the economic reforms are unprecedented or experimental for the PRC government, and are expected to be refined and improved. Other political, economic and social factors can also lead to further readjustment of such reforms. This refining and readjustment process may not necessarily have a positive effect on our operations or future business development. Our operating results may be adversely affected by changes in the PRC's economic and social conditions as well as by changes in the policies of the PRC government, which we may not be able to foresee, such as changes in laws and regulations (or the official interpretation thereof), measures which may be introduced to control inflation, changes in the rate or method of taxation, and imposition of additional restrictions on currency conversion.

The uncertain application of many PRC laws applicable to us create an uncertain environment for business operations and they could have a negative effect on us.
 
The PRC legal system is a civil law system. Unlike the common law system, such as the legal system used in the United States, the civil law system is based on written statutes in which decided legal cases have little value as precedents. In 1979, the PRC began to promulgate a comprehensive system of laws and has since introduced many laws and regulations to provide general guidance on economic and business practices in the PRC and to regulate foreign investment. Progress has been made in the promulgation of laws and regulations dealing with economic matters such as corporate organization and governance, foreign investment, commerce, taxation and trade. The promulgation of new laws, changes of existing laws and the abrogation of local regulations by national laws could have a negative impact on our business and business prospects. In addition, as these laws, regulations and legal requirements are relatively recent, their interpretation and enforcement involve significant uncertainty.
 
We may have limited legal recourse under PRC laws if disputes arise under our contracts with third parties.

The Chinese government has enacted laws and regulations dealing with matters such as corporate organization and governance, foreign investment, commerce, taxation and trade.  However, their experience in implementing, interpreting and enforcing these laws and regulations is limited, and our ability to enforce commercial claims or to resolve commercial disputes is unpredictable.  If our business ventures are unsuccessful, or other adverse circumstances arise from these transactions, we face the risk that the parties to these ventures may seek ways to terminate the transactions, or may hinder or prevent us from accessing important information regarding the financial and business operations of these acquired companies.  The resolution of these matters may be subject to the exercise of considerable discretion by agencies of the Chinese government, and forces unrelated to the legal merits of a particular matter or dispute may influence their determination. Any rights we may have to specific performance, or to seek an injunction under PRC laws, are severely limited, and without a means of recourse by virtue of the Chinese legal system, we may be unable to prevent these situations from occurring.  The occurrence of any such events could have a material adverse effect on our business, financial condition and results of operations.  Although legislation in China over the past 30 years has significantly improved the protection afforded to various forms of foreign investment and contractual arrangements in China, these laws, regulations and legal requirements are relatively new and their interpretation and enforcement involve uncertainties which could limit the legal protection available to us and foreign investors.  The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital and could have a material adverse impact on our operations.
 
 
16

 

We must comply with the Foreign Corrupt Practices Act.

We are required to comply with the United States Foreign Corrupt Practices Act, which prohibits U.S. companies from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining or retaining business.  Foreign companies, including some of our competitors, are not subject to these prohibitions.  Corruption, extortion, bribery, pay-offs, theft and other fraudulent practices occur from time-to-time in mainland China.  If our competitors engage in these practices, they may receive preferential treatment from personnel of some companies, giving our competitors an advantage in securing business or from government officials who might give them priority in obtaining new licenses, which would put us at a disadvantage.  We have not established formal policies or procedures for prohibiting or monitoring this conduct, and we can not assure you that our employees or other agents will not engage in such conduct for which we might be held responsible.  If our employees or other agents are found to have engaged in such practices, we could suffer severe penalties.
 
If we make equity compensation grants to persons who are PRC citizens, they may be required to register with SAFE.  We may also face regulatory uncertainties that could restrict our ability to adopt equity compensation plans for our directors and employees and other parties under PRC laws.

On April 6, 2007, State Administration of Foreign Exchange of China (the “SAFE”) issued the “Operating Procedures for Administration of Domestic Individuals Participating in the Employee Stock Ownership Plan or Stock Option Plan of An Overseas Listed Company, also known as “Circular 78.”  It is not clear whether Circular 78 covers all forms of equity compensation plans or only those which provide for the granting of stock options. For any plans which are so covered and are adopted by a non-PRC listed company, such as our company, after April 6, 2007, Circular 78 requires all participants who are PRC citizens to register with and obtain approvals from SAFE prior to their participation in the plan.  In addition, Circular 78 also requires PRC citizens to register with SAFE and make the necessary applications and filings if they participated in an overseas listed company’s covered equity compensation plan prior to April 6, 2007.  We believe that the registration and approval requirements contemplated in Circular 78 will be burdensome and time consuming.

If it is determined that any of our equity compensation plans are subject to Circular 78, failure to comply with such provisions may subject us and participants of our equity incentive plan who are PRC citizens to fines and legal sanctions and prevent us from being able to grant equity compensation to our PRC employees. In that case, our ability to compensate our employees and directors through equity compensation would be hindered and our business operations may be adversely affected.

If relations between the United States and China worsen, our stock price may decrease and we may have difficulty accessing the U.S. capital markets.
 
At various times during recent years, the United States and China have had disagreements over political and economic issues. Controversies may arise in the future between these two countries. Any political or trade controversies between the United States and China could adversely affect the market price of our common stock and our clients' ability to access U.S. capital markets.
 
 
17

 
 
Governmental control of currency conversion may affect the value of our stock.
 
The PRC government imposes controls on the convertibility of Renminbi into foreign currencies and, in certain cases, the remittance of currency out of the PRC. Currently, the Renminbi is not a freely convertible currency. Shortages in the availability of foreign currency may restrict our clients' ability to remit sufficient foreign currency to pay our fees, to pay dividends, or otherwise satisfy foreign currency denominated obligations. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and expenditures from the transaction, can be made in foreign currencies without prior approval from the SAFE by complying with certain procedural requirements. However, approval from appropriate governmental authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans and corporate debt obligations denominated in foreign currencies.
 
The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions. If the foreign exchange control system prevents our clients or us from obtaining sufficient foreign currency to satisfy currency demands, we or our clients may not be able to pay certain of our or their expenses as they come due.

The fluctuation of the Renminbi may materially and adversely affect our operations.
 
The value of the Renminbi against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in the PRC's political and economic conditions. Any significant revaluation of the Renminbi may materially and adversely affect our cash flows, revenues and financial condition. For example, to the extent that we or our clients need to convert U.S. dollars into Renminbi for our or their operations, appreciation of the Renminbi against the U.S. dollar could have a material adverse effect on our business, financial condition and results of operations.
 
Conversely, if we decide to convert our Renminbi into U.S. dollars for business purposes and the U.S. dollar appreciates against the Renminbi, the U.S. dollar equivalent of the Renminbi we convert would be reduced. Any significant devaluation of Renminbi may reduce our operation costs in U.S. dollars but may also reduce our earnings in U.S. dollars. In addition, the depreciation of significant U.S. dollar denominated assets could result in a charge to our income statement and a reduction in the value of these assets.
 
Commencing July 21, 2005, China has adopted a managed floating exchange rate regime based on market demand and supply with reference to a basket of currencies. The exchange rate of the US dollar against the RMB was adjusted from approximately RMB 8.28 per US dollar to approximately RMB 8.11 per US dollar on July 21, 2005. Since then, the PBOC administers and regulates the exchange rate of the US dollar against RMB taking into account demand and supply of RMB, as well as domestic and foreign economic and financial conditions.
 
In addition, there can be no assurance we will be able to obtain sufficient foreign exchange to pay dividends or satisfy other foreign exchange requirements in the future and we currently do not intend to pay dividends.

It may be difficult to effect service of process and enforcement of legal judgments upon our company and our officers and directors because some of them reside outside the United States.
 
Since part of our operations are presently based in China, service of process on our business and officers may be difficult to effect within the United States. Also, some of our assets are located outside the United States and any judgment obtained in the United States against us may not be enforceable outside the United States. We have appointed Keith Wong, our Chief Executive Officer and President, as our agent to receive service of process in any action against our company in the United States.
 
 
18

 
 
ITEM 1B.
UNRESOLVED STAFF COMMENTS
 
As a smaller reporting company, we are not required to provide Item 1B disclosure.
 
ITEM 2.
PROPERTIES
 
Our executive office is located at 8040 E. Morgan Trail, Unit 18, Scottsdale, AZ  85258. We lease these facilities, consisting of approximately 900 square feet, for $ 664 per month.  We currently have a month to month lease agreement with the landlord but intend to execute a long term agreement in the near future..
 
EastBridge obtained the approval from the local authority of Beijing, capital of China, to operate a representative office to serve its Chinese clients.  This office is housed in the office tower of Kunlun Hotel and became fully operational in January of 2008 to serve existing and new clients. The Company leases these offices for $1,800 per month.  The term of the lease is on a month-to-month basis.    
 
In 2010, the Company entered into a lease for housing accommodations for its CEO while in Bejing.  These facilities are being leased for $4,250 a month, to be paid with restricted stock.  The term of this lease is a two year lease which commenced in January, 2010.
 
The aforesaid properties are in good condition and we believe they will be suitable for our purposes for the next 12 months.  There is no affiliation between us and any of our principals or agents and our landlords or any of their principals or agents.
 
Monthly Lease Obligations
 
   
Scottsdale
   
Beijing China
   
Total
 
2011
  $ 664     $ 6,050     $ 6,714  
2010
  $ 664     $ 6,050     $ 6,714  
 
ITEM 3.
LEGAL PROCEEDINGS
 
We are currently not involved in any litigation that we believe could have a materially adverse effect on our financial condition or results of operations. Except that the Company is undergoing an audit by the Internal Revenue Service related to employment tax liability for the 2006-2008 tax years, there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our company's or our company's subsidiaries' officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.
 
ITEM 4.
MINE SAFETY DISCLOSURE
 
Not applicable.
 
 
19

 
 
PART II
 
ITEM 5.
MARKET FOR REGISTRANT'S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
 
EastBridge common stock is traded in the over-the-counter market, and quoted in the National Association of Securities Dealers Inter-dealer Quotation System ("OTCBB") and can be accessed on the Internet at www.otcbb.com under the symbol "EBIG.OB."
 
As of December 31, 2011, there were 154,590,189 shares of common stock of EastBridge outstanding and there were approximately 1,600 shareholders of record of the Company's common stock.
 
The following table sets forth for the periods indicated the high and low bid quotations for EastBridge's common stock.  These quotations represent inter-dealer quotations, without adjustment for retail markup, markdown or commission and may not represent actual transactions.
 
Periods
 
High
   
Low
 
Fiscal Year 2011
           
First Quarter (January – March 2011)
  $ 0.18     $ 0.10  
Second Quarter (April – June 2011)
  $ 0.11     $ 0.05  
Third Quarter (July – September 2011)
  $ 0.09     $ 0.05  
Fourth Quarter (October – December 2011)
  $ 0.09     $ 0.05  
                 
Fiscal Year 2010                
First Quarter (January – March 2010)
  $ 0.20     $ 0.04  
Second Quarter (April – June 2010)
  $ 0.17     $ 0.05  
Third Quarter (July – September 2010)
  $ 0.14     $ 0.05  
Fourth Quarter (October – December 2010)
  $ 0.10     $ 0.04  
 
On March 27, 2012, the closing bid price of our common stock was $0.06.

Dividends
 
We did not declare any cash dividends for the years ended December 31, 2011and 2010. Our Board of Directors does not intend to declare any dividends in the near future. The declaration, payment and amount of any future dividends will be made at the discretion of the Board of Directors, and will depend upon, among other things, the results of our operations, cash flows and financial condition, operating and capital requirements, and other factors as the Board of Directors considers relevant. There is no assurance that future dividends will be paid, and if dividends are paid, there is no assurance with respect to the amount of any such dividend.

Equity Compensation Plans
 
2009 Stock Option Plan
 
During the first quarter of 2009, the Company's Board of Directors approved and adopted the 2009 Stock Option Plan  (the "Plan") and designated 10,000,000 of its no par common stock for issuance under the Plan to employees, directors or consultants for EastBridge through either the issuance of shares or stock option grants.  Under the terms of the Plan, stock option grants shall be made with exercise prices not less than 100% of the fair market value of the shares of common stock on the grant date.
 
 
20

 
 
2011 Incentive Stock Option Plan
 
During the last quarter of 2011, the Company's Board of Directors approved and adopted the 2011 Incentive Plan (the "2011 Plan") and designated 30,000,000 of its no par common stock for issuance under the 2011 Plan to employees, directors or consultants for EastBridge through either the issuance of shares or stock option grants.  Under the terms of the 2011 Plan, stock option grants shall be made with exercise prices not less than 100% of the fair market value of the shares of common stock on the grant date.
 
All Equity Compensation Plans
 
Plan Category
 
Number of securities to
be issued upon exercise of outstanding options,
warrants and rights (#)
   
Weighted-average exercise
price of outstanding
options, warrants and
rights ($)
   
Number of securities
remaining available for
future issuance under equity compensation plans
 
                         
Equity compensation plans approved by shareholders
   
__
     
__
      30,679,290  
                         
Equity compensation plans not approved by shareholders
   
__
     
__
     
__
 
                         
Total
   
__
     
__
      30,679,290  

Transfer Agent
 
EastBridge's transfer agent and Registrar for the common stock is Jersey Transfer and Trust Company located in Verona, New Jersey.
 
Recent Sales of Unregistered Securities
 
Years Ended
 
Stock issued
for Cash
   
Cash
Received
   
Stock for
Conversion of Debt
   
Stock Issued
for services
   
Cancelled
Shares
 
December 31, 2011
    -     $ -       1,431,600       4,504,724       -  
December 31, 2010
    -     $ -       4,344,421       3,932,105       -  
 
All unregistered sales and issuances of equity securities for the year ended December 31, 2011 were previously disclosed in a Form 8-K or Form 10-Q filing.
 
ITEM 6.
SELECTED FINANCIAL DATA
 
As a smaller reporting company, we are not required to provide Item 6 disclosure.

ITEM 7.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
The following is management's discussion and analysis of certain significant factors that have affected our financial position and operating results during the periods included in the accompanying consolidated financial statements, as well as information relating to the plans of our current management. This report includes forward-looking statements. Generally, the words "believes," "anticipates," "may," "will," "should," "expect," "intend," "estimate," "continue," and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the Securities and Exchange Commission from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements.
 
 
21

 
 
The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes thereto and other financial information contained elsewhere in this Form 10-K.
 
Critical Accounting Policies and Estimates
 
We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires the use of 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 financial statements and the reported amount of revenues and expenses during the reporting period. Our management periodically evaluates the estimates and judgments made. Management bases its estimates and judgments on historical experience and on various factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates as a result of different assumptions or conditions.
 
The following summarizes critical estimates made by management in the preparation of the consolidated financial statements.
 
Stock-Based Compensation
 
We periodically use stock-based awards, consisting of shares of common stock, to compensate certain officers and consultants.  Shares are expensed on a straight line basis over the requisite service period based on the grant date fair value, net of estimated forfeitures, if any.  Typically, our awards are fully vested at the date of grant, so forfeitures are not applicable.
 
Revenue Recognition
 
We utilize the guidance set forth in the Securities and Exchange Commission's Staff Accounting Bulletin (SAB) No. 104, regarding the recognition, presentation and disclosure of revenue in financial statements.  We engage in listing contracts with our clients which provide for the payment of fees, either in cash or equity, upon the achievement of certain milestones by our clients with our assistance, including the successful completion of a financial statement audit, the successful listing on a national stock exchange and the maintenance of ongoing Exchange Act registration requirements with the Securities and Exchange Commission.  In some instances, payment may be made in advance of performance; however, such payment is often refundable in the event that milestones are not reached.   We recognize revenue on a systematic basis as milestones are reached in accordance with FASB’s Accounting Standards Codification (“ASC”) 605 “Revenue Recognition” Update No. 2009-13.  Such guidance stipulates that revenue be recognized for individual elements in a multiple deliverable arrangement using the relative selling price method.  We rely on internal estimates of the relative selling price of each element as objective third-party evidence is unattainable.
 
Income Taxes
 
Income taxes are accounted for using the asset and liability method as prescribed by ASC 740 “Income Taxes”. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance would be provided for those deferred tax assets for which if it is more likely than not that the related benefit will not be realized.
 
 
22

 
 
A full valuation allowance has been established against all net deferred tax assets as of December 31, 2011 based on estimates of recoverability.  While we have optimistic plans for our business strategy, we determined that such a valuation allowance was necessary given the current and expected near term losses and the uncertainty with respect to our ability to generate sufficient profits from our business model.
 
 
Statement of Operations Data      
    December 31,  
  
 
2011
 
2010
 
Revenues
  $ 35,500     $ 1,741,682  
Operating and Other Expenses
    (801,914 )     (1,916,636 )
  
               
Net Loss
  $ (766,414 )   $ (174,954 )
  
               
Balance Sheet Data:
               
     
December 31,
 
  
    2011       2009  
Current Assets
  $ 602,747     $ 49,898  
Total Assets
    1,545,230       1,663,980  
Current Liabilities
    1,970,886       1,605,117  
Non Current Liabilities
    ––       ––  
Total Liabilities
    1,970,886       1,605,117  
Working Capital (Deficit)
    (1,368,139 )     (1,555,219 )
Shareholders'Equity (Deficit)
  $ (425,656 )   $ 58,863  
 
Fiscal Year Ended December 31, 2011, Compared to Fiscal Year Ended December 31, 2010
 
Results of Operations

Revenues
 
Year Ended December 31,
 
 
Revenues
   
Change from
Prior Year
   
Percent Change
from Prior Year
 
                   
2011
  $ 35,500     $ (1,706,182 )     (98.0 )%
2010
  $ 1,741,682                  
 
Revenues in fiscal 2011 decreased by approximately $1,706,000, due primarily to timing of specific listing agreements.  Most of the current agreements stipulate that the revenues are dependent upon the successful listing of the client company on a U.S. stock exchange or other market.  The Company recognized revenue in 2010 based on receipt of shares in clients per an agreement that was not dependent on successful listing.  In 2011, revenue was associated with cash fees for which services were fully rendered.

General and Administrative Expenses

Year Ended December 31,
 
General &
Administrative
Expenses
   
Change
from
Prior Year
   
Percent Change
from
Prior Year
 
                   
2011
  $ 1,219,882     $ (108,462 )     (8.2 )%
2010
  $ 1,328,344                  
 
23

 
 
General and administrative expenses decreased in fiscal 2011 as compared to fiscal 2010 due to the following:

A decrease in accounting and legal fees of our clients of approximately $101,000 (we agreed to cover these professional fees for our clients under certain of these agreements).
 
A decrease in consulting fees of approximately $122,000 (we agreed to cover non-legal and non-accounting professional fees for our clients under certain of these agreements).
 
An increase in payroll tax expense of $94,000 as the Company has accrued for a potential liability from an IRS review.
 
An increase in rent expense of approximately $7,400, as we entered into an agreement to provide living quarters in Beijing.
 
An increase of other general and administrative fees of approximately $13,100.
 
 Sales and Marketing Expenses
 
Year Ended December 31,
 
Sales &
Marketing
Expenses
   
Change
from
Prior Year
   
Percent Change
from
Prior Year
 
                   
2011
  $ 102,479     $ 245       0.2 %
2010   102,234                  
 
Sales and marketing expenses increased in fiscal 2011 as compared to fiscal 2010 due to other marketing related expenses of approximately $30,500 and decreased travel of approximately $30,300.

Operating Loss

Year Ended December 31,
 
Operating
Loss
   
Change from
Prior Year
   
Percent Change
from Prior Year
 
                   
2011
  $ (1,286,861 )   $ (1,597,965 )     (513.6 )%
2010
  $ 311,104                  
 
The decrease in our operating loss for fiscal 2011 as compared to fiscal 2010 is primarily due to changes in revenues, sales and marketing expenses and general and administrative expenses, each of which is described above.
 
Total Other Income (Expense)
 
Year Ended December 31,
 
Total Other Income (Expense)
   
Change from
Prior Year
   
Percent Change
from Prior Year
 
                   
2011
  $ (520,447 )   $ (1,006,506 )     (207.1 )%
2010
  $ 486,059                  
 
Other income (expense) decreased in fiscal 2011 as compared to fiscal 2010 due to the following:
 
An increase in gain from the sale or exchange of investments of approximately $477,600,
 
An increase from the extinguishment of debt of approximately $529,700
 
A decrease of interest income of approximately $800.
 
 
24

 
 
Income Tax Provision (Benefit)

Year Ended December 31,
 
Income Tax
Provision (Benefit)
   
Change from
Prior Year
   
Percent Change
from Prior Year
 
                   
2011
  $ -     $ -       0.0 %
2010
  $ -                  
 
While we have optimistic plans for our business strategy, we determined that a valuation allowance was necessary given the current and expected near term losses and the uncertainty with respect to our ability to generate sufficient profits from our business model.  Therefore, we established a valuation allowance for all deferred tax assets.
 
Net Loss

Year Ended December 31,
 
Net Loss
   
Change from
Prior Year
   
Percent Change
from Prior Year
 
                   
2011
  $ (766,414 )   $ (591,459 )     338.1 %
2010
  $ (174,955 )                
 
Changes in net loss are primarily attributable to changes in operating income, other income (expense) and discontinued operations, each of which is described above.
 
LIQUIDITY AND CAPITAL RESOURCES
 
Net cash provided by or (used in) operating activities is $347,866 and $(90,211) for the years ended December 31, 2011 and 2010 respectively.  The increase is mainly attributable to the increase in our payables and decrease in operating expenses combined with the non-cash gain on extinguishment of debt offset by the value of stock received for services.

Our primary source of cash inflows has historically been from listing agreement customers.  In 2010 we received an advance payment of shares of a client that is expected to be completed in the first half of 2011.  In 2011 we sold some of the shares of a client received in 2010.  As of December 31, 2011, no single customer accounted for greater than 10% of accounts receivable as part of the agreements require deposits in advance rather than billing after the fact.

Cash provided by (used in) financing activities was $204,983 and $(22,500) in the years ended December 31, 2011 and 2010, respectively. The increase is due to repayment of $18,750 of the lending from a local bank of $100,000 received in 2008, advances from our Chief Executive Officer of $23,588, advances from our Chief Financial Officer of $2,445 and advances from other affiliates in the amount of $197,700.

We had working capital of $(1,368,139) as of December 31, 2011 compared to $(1,554,555) as of December 31, 2010.  Our cash position increased to $602,747 at December 31, 2011 compared to $49,898 at December 31, 2010, as we had an increase in cash flows from operations, together with an increase in cash flows from investing activities.

Our monthly cash requirement amount is approximately $15,000.  For the year ended December 31, 2010, we have received shares of stock in two clients for services provided with a value of $1,614,082.  During 2010, we did not sell any shares of common stock for cash consideration.  During the year ended December 31, 2011, we had sold shares of stock in a client with an original value of approximately $374,200 for a gain of approximately $268,800 for cash.

In the past we have received cash through loans extended by our management to the Company and through sales of shares of common stock to individual investors.  As we are a consulting company with no proprietary technology it is doubtful we will obtain capital from institutional or other sources and will need to rely on our officers for cash infusions.  As much of our revenue will come through sales of equity in our clients it may be several months until we obtain positive cash flows as this will occur only if and when our clients have registration statements cleared by the SEC which include our shares of common stock and they become listed on U.S. stock exchanges or over-the-counter markets.
 
 
25

 

 
ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 
As a smaller reporting company, we are not required to provide Item 7A disclosure.
 
ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
Attached hereto and filed as a part of this Annual Report on Form 10-K are our Consolidated Financial Statements, beginning on page F-1.
 
*  *  *  *  *  *
 
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
 
We have no reportable events or disagreements with our current or prior auditors.
 
ITEM 9A(T).
CONTROLS AND PROCEDURES
 
Our management team, under the supervision and with the participation of our principal executive officer and our principal financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as such term is defined under Rules 13a-14(c) and 15d-14(c) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act), as of the last day of the fiscal period covered by this report, December 31, 2011. The term disclosure controls and procedures means our controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under 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 by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our principal executive and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2011.
 
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Management is required to base its assessment of the effectiveness of our internal control over financial reporting on a suitable, recognized control framework, such as the framework developed by the Committee of Sponsoring Organizations (COSO). The COSO framework, published in Internal Control-Integrated Framework, is known as the COSO Report. Our principal executive officer and our principal financial officer have chosen the COSO framework on which to base their assessment. Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2011, but identified the following significant deficiencies:
 
Significant Deficiencies –
 
LACK OF INDEPENDENT BOARD OF DIRECTORS AND AUDIT COMMITTEE
 
Management is aware that an audit committee composed of independent members along with a qualified audit committee financial expert has not yet been established.  Considering the costs associated with procuring and providing the infrastructure to support an independent audit committee and the limited number of transactions, management has concluded that the risks associated with the lack of an independent audit committee are not justified.  Management will periodically reevaluate this situation.
 
 
26

 
 
LACK OF SEGREGATION OF DUTIES
 
Management is aware that there is a lack of segregation of duties at the Company due to the small number of employees dealing with general administrative and financial matters. However, at this time management has decided that considering the abilities of the employees now involved and the control procedures in place, the risks associated with such lack of segregation are low and the potential benefits of adding employees to clearly segregate duties do not justify the substantial expenses associated with such increases.  Management will periodically reevaluate this situation.
 
This annual report on Form 10-K does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to permanent rules of the Securities and Exchange Commission that permit smaller reporting companies to provide only management's report in this annual report on Form 10-K.
 
It should be noted that any system of controls, however well designed and operated, can provide only reasonable and not absolute assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of certain events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.
 
Changes in Internal Control Over Financial Reporting
 
During the fiscal quarter ended December 31, 2011, there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
 
ITEM 9B.
OTHER INFORMATION
 
None.
 
 
27

 

PART III
 
ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
 
Directors and Executive Officers
 
Set forth below is information regarding the Company's current directors and executive officers. There are no family relationships between any of our directors or executive officers. The directors are elected annually by shareholders. The executive officers serve at the pleasure of the Board of Directors.  There is no arrangement or understanding between any of the directors or officers of the Company and any other person pursuant to which any director or officer was or is to be selected as a director or officer, and there is no arrangement, plan or understanding as to whether non-management shareholders will exercise their voting rights to continue to elect the current directors to the Company’s Board.  There are also no arrangements, agreements or understandings between non-management shareholders that may directly or indirectly participate in or influence the management of the Company’s affairs.  There are no agreements or understandings for any officer or director to resign at the request of another person, and none of the officers or directors are acting on behalf of, or will act at the direction of, any other person.
 
Name
 
Age
 
Position(s)
With the Company
 
Position
Held Since
 
Director
Since/During
Keith Wong
 
57
 
President, CEO, and Director
 
June, 2001
 
June, 2001
Norm Klein
 
62
 
CFO, COO, IRO, and Director
 
June, 2005
 
June, 2005

The following is a brief description of the business experience during the past five years of each of the above-named persons:
 
Keith Wong – President, Chief Executive Officer, and Director
 
Mr. Wong brings 23 years of experience in sales, business management, finance, manufacturing, Asian suppliers and Asian business networks.
 
Since 2001, Mr. Wong has acted as the President and CEO of ATC Technology Group, which later became EastBridge Investment Group Corporation.
 
From 1989 to 2001, Mr. Wong was the President and CEO of Amtel International Corporation, where he built the company into a leader in selling promotional TV and small appliances. This company designed and imported televisions and small appliances from Asia.  Mr. Wong built this company from scratch and increased sales from zero to more than $8,000,000 per year.  This company provided experiences to Mr. Wong in the electronics business in working with international suppliers and several top U.S. chain stores including Kmart and Wal-Mart. Amtel won much acclaim for its products including a design award, Innovations 2001 Design and Engineering Award, from the Industrial Society of America and the Consumer Electronics Association.
 
 
28

 
 
From 1986 to 1989, Mr. Wong was a sales executive with Coherent, Inc. for Asia-Pacific for four years. Prior to his sales experience, Mr. Wong was an electronics design engineer for several high tech companies including Computer Vision, Tektronix and General Electric, where he was awarded the Ed Woll's Young Engineer Award in 1980 for his efforts in improving military jet engine manufacturing.
 
Mr. Wong holds a Bachelors and Masters degree in electrical engineering from Rutgers University and Northeastern University, respectively. Mr. Wong successfully completed several corporate finance courses for executives from Harvard University. Mr. Wong also holds two U.S. utility patents and one U.S. design patent.
 
Mr. Wong is a founding member of the Asian Bank of Arizona and a member of the Beijing Equity Exchange.
 
In considering Mr. Wong's continued eligibility to serve on the Board, the Board considered the following –
 
Mr. Wong has been an owner of his own business since 1989 responsible for all aspects of the operation including financial, marketing, sales and operational matters.  Mr. Wong also served on the Board of Directors for a new bank in the Phoenix market and provided his management experience in assisting in the startup of this new bank in the Chinese community.
 
Norm Klein - Chief Financial Officer, Chief Operating Officer and Investor Relations Officer
 
Mr. Klein has over twenty years of experience working in manufacturing and process control with major companies. Mr. Klein also brings his expertise in engineering, operational leadership, and business management to EastBridge.
 
Since 2001, Mr. Klein has acted as the CFO, COO, and IRO for ATC Technology Group, which later became known as EastBridge Investment Group Corporation.
 
Since 1997, Mr. Klein has been the owner of, and consultant for High Performance Edge, Inc. The firm provides consulting services in the areas of leadership development, organizational development and process improvement. The firm also provides startup management expertise for companies that want to increase sales and operational capacity. The firm's clients include Clorox, Honeywell/Allied Signal, Ingersol Rand, Durel Corporation and Dreyers Ice Cream Company.
 
From 1972 to 1993, Mr. Klein was employed at Procter & Gamble, where he was responsible for the operational aspects of the company's Metamucil business. Mr. Klein provided the leadership role for a $60 million manufacturing plant expansion and managed an operating budget in excess of $30 million. Further, as a member of Procter & Gamble's profit and loss team for its hair care business, Mr. Klein led the launch of the first combined shampoo and conditioner product, Pert shampoo.  This quickly grew to be a $100 million business and the successful launch propelled P&G's hair care business to the number one position in the market based on market share.
 
Mr. Klein provides EastBridge with high quality business management, strategic planning and financial system development experience.  His knowledge of operations and finance will be invaluable as EastBridge expands its operational capabilities and launches new services in the near future.
 
Mr. Klein holds a Bachelors degree in mechanical engineering from Rose Hulman Institute and a Masters degree in business administration from the University of Iowa.
 
In considering Mr. Klein's continued eligibility to serve on the Board, the Board considered the following –
 
Mr. Klein has been an executive for several corporations including Procter & Gamble and Con-Agra leading major segments of these companies.  He also has experience on non-profit boards such as Junior Achievement and Boys & Girls Clubs including leadership positions on these boards.   He also has owned and operated his own companies for more than 15 years.  His skills include financial management, operations and human resources.
 
 
29

 
 
Audit Committee
 
The Company does not have any standing committees at this time and due to its small size does not believe that committees are necessary at this time.  In addition, the Company's Board of Directors has determined that the Company does not have an audit committee financial expert serving on the Board and does not believe one is necessary at this time due to the relative simplicity of the Company's financial transactions. When the Company develops its operations and reaches sufficient size to justify having committees, it plans to create an audit and a compensation committee and to seek an audit committee financial expert for its Board and audit committee, but there is no assurance it will be successful in doing so.
 
Conflicts of Interest
 
Members of our management are associated with other firms involved in a range of business activities.  Consequently, there are potential inherent conflicts of interest in their acting as officers and directors of our company.  Although the officers and directors are engaged in other business activities, we anticipate they will devote an important amount of time to our affairs.
 
Our officers and directors are now and may in the future become shareholders, officers or directors of other companies, which may be formed for the purpose of engaging in business activities similar to ours.  Accordingly, additional direct conflicts of interest may arise in the future with respect to such individuals acting on behalf of us or other entities.  Moreover, additional conflicts of interest may arise with respect to opportunities which come to the attention of such individuals in the performance of their duties or otherwise.  Currently, we do not have a right of first refusal pertaining to opportunities that come to their attention and may relate to our business operations.
 
Our officers and directors are, so long as they are our officers or directors, subject to the restriction that all opportunities contemplated by our plan of operation which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to us and the companies that they are affiliated with on an equal basis.  A breach of this requirement will be a breach of the fiduciary duties of the officer or director.  If we or the companies with which the officers and directors are affiliated both desire to take advantage of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity.  However, all directors may still individually take advantage of opportunities if we should decline to do so.  Except as set forth above, we have not adopted any other conflict of interest policy with respect to such transactions.
 
Compliance With Section 16(A) Of The Exchange Act
 
Section 16(a) of the Exchange Act requires the Company’s directors and executive officers, and persons who beneficially own more than ten percent of a registered class of our equity securities, to file with the SEC initial reports of beneficial ownership and reports of changes in beneficial ownership of our common stock.  The rules promulgated by the SEC under Section 16(a) of the Exchange Act require those persons to furnish us with copies of all reports filed with the Commission pursuant to Section 16(a).  The information in this section is based solely upon a review of Forms 3, Forms 4, and Forms 5 received by us.

We believe that all of EastBridge's executive officers, directors and 10% shareholders have timely complied with their filing requirements during the year ended December 31, 2011.

Code of Ethics
 
We have adopted a code of ethics which applies to all our directors, officers and employees and comprises written standards that are reasonably designed to deter wrongdoing and to promote the behavior described in Item 406 of Regulation S-K promulgated by the SEC.  A copy of our "Code of Ethics and Business Conduct for Officers, Directors and Employees" was filed with the SEC as Exhibit 14.1 to the Registration Statement, filed October 30, 2006.  In the event that we make any amendments to, or grant any waivers of, a provision of our Code of Ethics and Business Conduct for Officers, Directors and Employees that applies to the principal executive officer, principal financial officer or principal accounting officer that requires disclosure under applicable SEC rules, we intend to disclose such amendment or waiver and the reasons therefor in a Form 8-K or in our next periodic report.
 
 
30

 
 
Changes to Nominating Procedures
 
There have been no material changes to the procedures by which our shareholders may recommend nominees to the Board of Directors during our last fiscal year.
 
ITEM 11.
EXECUTIVE COMPENSATION
 
Summary Compensation Table
 
The following table sets forth for the years ended December 31, 2011 and 2010 compensation awarded to, paid to, or earned by, Keith Wong and Norm Klein (both are directors and officers).  We have no other executive officers.  In 2010, the entire compensation due to the CEO and CFO remains outstanding except the $14,039 and $9,283 due from the end of 2009, which was paid in stock.  In 2011, the entire compensation due to the officers remains outstanding.
 
                         
Nonqualified
         
                     
Non-Equity
 
Deferred
         
             
Stock
 
Option
 
Incentive Plan
 
Compensation
 
All Other
     
     
Salary
 
Bonus
 
Awards
 
Awards
 
Compensation
 
Earnings
 
Compensation
 
Total
 
Name and Principal Position
Year
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
 
($)
 
Keith Wong
2011
    240,000     -     -     -     -     -           240,000  
 
2010
    240,000         -     -     -     -     0     240,000  
Norm Klein
2011
    180,000     -     -     -     -     -           180,000  
 
2010
    180,000         -     -     -     -     0     180,000  
 
Employment Agreements
 
On June 1, 2005, we entered into an employment agreement with Keith Wong, our President and Chief Executive Officer. The agreement provides for annual compensation in the amount of $240,000, effective June 1, 2005.  Mr. Wong’s agreement contains confidentiality, non-compete, and good faith cooperation covenants. The agreement will continue indefinitely until it is terminated by the Company for cause only, terminated upon the death, disability, retirement, bankruptcy or incompetency of Mr. Wong, or by mutual agreement of both parties.
 
On June 1, 2005, we entered into an employment agreement with Norm Klein, our Chief Financial Officer, Chief Operating Officer and Investor Relations Officer. The agreement provides for annual compensation in the amount of $84,000, effective on June 1, 2005 and was increased to an annual compensation of $180,000, effective January 1, 2007.  Mr. Klein’s agreement contains confidentiality, non-compete and good faith cooperation covenants. The agreement will continue indefinitely until it is terminated by the Company for cause only, terminated upon the death, disability, retirement, bankruptcy or incompetency of Mr. Klein, or by mutual agreement of both parties with or without cause and without prior notice subject to the termination provisions in the agreement.
 
Compensation of Directors
 
We currently have two directors. Our current compensation policy for directors is to compensate them through options to purchase common stock as consideration for their joining our Board and/or providing continued services as a director. We do not currently provide our directors with cash compensation, although we do reimburse their expenses. No additional amounts are payable to the Company's directors for committee participation or special assignments. There are no other arrangements pursuant to which any directors was compensated during the Company's last completed fiscal year for any service provided.
 
 
31

 
 
2011 DIRECTOR COMPENSATION TABLE
 
Name  
 
Fees Earned or
Paid in Cash
($)
   
Stock
Awards
($)
   
Option
Awards
($)
   
Non-Equity
Incentive
Plan
Compensation
($)
   
Change
in Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
   
All Other
Compensation
($)
   
Total
($)
 
Keith Wong     -       -       -       -       -       -       -  
Norm Klein     -       -       -       -       -       -       -  
 
Risk Management in Compensation Policies and Procedures
 
Due to the Company's lack of cash flows, it has historically compensated its officers in stock rather than paying a cash salary.  By compensating these officers in stock, we believe they have a greater incentive to take steps to increase the value of the Company's stock than they would if compensated in cash.  As the Company's value is largely based on the value of the equity it receives from its clients, paying the officers using Company stock may incentivize them to take additional risks in an attempt to increase the value of the Company's stock.

Compensation Committee Interlocks and Insider Participation

As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

Compensation Committee Report
 
As a smaller reporting company, the Company is not required to provide the disclosure required by this item.

ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
 
The following table lists stock ownership of our common stock as of March 15, 2012. The information includes beneficial ownership by (i) holders of more than 5% of our common stock, (ii) each of our directors and executive officers and (iii) all of our directors and executive officers as a group. Except as noted below, to our knowledge, each person named in the table has sole voting and investment power with respect to all shares of our common stock beneficially owned by them.  As of March 27, 2012, the Company had 156,347,027 shares of common stock and no shares of preferred stock outstanding.  Except as otherwise indicated below, the address for each listed beneficial owner is c/o EastBridge Investment Group Corporation, 8040 E. Morgan Trail, Unit 18, Scottsdale, Arizona 85258.
 
Name and Address of Beneficial Owner
 
Title
of Class
 
Amount and
Nature of
Beneficial
Ownership
 
Percent
of Class
 
Named Executive Officers
               
Keith Wong
 
Common stock
   
50,100,000
 
32
%
Norm Klein3
 
Common stock
   
11,956,196
 
8
%
All Officers and Directors
As a Group (2 persons) 
 
Common stock
   
62,056,196
 
40
%
 
———————
Changes in Control
 
We are not aware of any arrangements that may result in a change in control of the Company.
 
 
32

 
 
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
 
The Company reduced the CEO’s and CFO’s accrued compensation by offsetting the unpaid accrued compensation by the cash payments to the CEO of $0 and $14,039 and to the CFO of $0 and $9,283, during the years ended December 31, 2011 and 2010, respectively.  As of December 31, 2011 and 2010, the accrued compensation liability to the officers were $841,929 and $421,929, respectively.    In 2011 and 2010 no payroll tax liability existed.

The Company received advances from its CEO and CFO during the course of business at a rate of 4.5% interest which is the federal long term interest rate. As of December 31, 2011 and 2010 advances payable to the Company’s CEO were $30,188 and $6,600, respectively.  As of December 31, 2011 and 2010 advances payable to the Company’s CFO were $24,245 and $21,800, respectively.

The Company entered into an employment agreement with Keith Wong, the CEO, on June 1, 2005. Under the terms of the agreement the CEO receives compensation in the amount of $240,000 annually. The Company entered into an employment agreement with Norm Klein, its CFO, on June 1, 2005. Under the terms of its agreement the CFO received $84,000 in compensation annually from the inception of the agreement through January 1, 2007 at which point the consulting compensation increased to $180,000.

In the second quarter of 2010, the Company issued 1,244,421 shares of common stock to its two officers. In total, 426,239 common shares were issued at $.13 for a cumulative value of $55,411 to the CEO and 818,182 common shares were issued at $.13 for a cumulative value of $106,364 to the Company’s CFO.  The common shares were issued and accepted by the Company’s officers at the closing trading price on the date of issue and were applied against the accrued balance due to the two officers for a portion of unpaid salaries through the date of issuance.

In connection with the Company's entry into its loan restructure with Goldwater Bank, N.A. dated May 6, 2009, Mr. Wong and Mr. Klein each entered into a personal guaranty with the bank.  Mr. Wong and Mr. Klein have also personally guaranteed the Company's office lease.  No compensation was paid to Mr. Wong or Mr. Klein in connection with these guarantees.

Using the standards of the NASDAQ Capital Market, which listing standards are not applicable to the Company, the Company's Board has determined that its two directors would not qualify as independent directors.  The Company did not consider any relationship or transaction between itself and Mr. Wong or Mr. Klein not already disclosed in this report in making this determination.
 
 
33

 
 
ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
 
The Company paid or accrued the following fees in each of the prior two fiscal years to its principal accountant, Taravan, Askelson & Company, LLP,:
 
   
Year ended
   
Year ended
 
   
December 31,
   
December 31,
 
   
2011
   
2010
 
             
1
Audit fees
  $ 20,320     $ 34,930  
2
Audit-related fees
    0       0  
3
Tax fees
    0       0  
4
All other fees
    0       0  
                 
Totals
  $ 20,320     $ 34,930  
 
Audit fees include fees for the audit of our annual financial statements, reviews of our quarterly financial statements, and related consents for documents filed with the SEC.  All other fees include fees for auditing of listing agreement clients as required by the SEC for listing..
 
As part of its responsibility for oversight of the independent registered public accountants, the Board has established a pre-approval policy for engaging audit and permitted non-audit services provided by our independent registered public accountants.  In accordance with this policy, each type of audit, audit-related, tax and other permitted service to be provided by the independent auditors is specifically described and each such service, together with a fee level or budgeted amount for such service, is pre-approved by the Board.  All of the services provided by our independent registered public accountants described above were approved by our Board.

Our principal accountants did not engage any other persons or firms other than the principal accountant’s full-time, permanent employees.
 
The Board has received and reviewed the written disclosures and the letter from the independent registered public accounting firm required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees), and has discussed with its auditors its independence from the Company. The Board has considered whether the provision of services other than audit services is compatible with maintaining auditor independence.
 
Based on the review and discussions referred to above, the Board approved the inclusion of the audited consolidated financial statements be included in the Company's Annual Report on Form 10-K for its 2010 fiscal year for filing with the SEC.
 
 
34

 
 
PART IV
 
ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
 
 
Exhibits
 
Exhibit Number
 
Description
     
2.1
 
Plan of reorganization and exchange agreement1
3.1
 
Articles of incorporation of EastBridge Investment Group Corporation1
3.1.2
 
Articles of incorporation of EastBridge Investment Group Corporation, as amended1
3.2
 
Corporate bylaws for EastBridge Investment Group Corporation1
4.1
 
Form of stock lock-up agreement1
4.2
 
2007 Stock Incentive Plan, dated June 14, 20073
4.3
 
2008 Employees and Consultants Stock Option Plan, dated August 20, 20088
4.4
 
2009 Stock Option Plan10
10.1
 
Consulting Employment Agreement between EastBridge Investment Group Corporation and Keith Wong dated June 1, 20051
10.2
 
Consulting Employment Agreement between EastBridge Investment Group Corporation and Norm Klein dated June 1, 20051
10.3
 
Translated Listing Agreement signed with Amonics Limited  (signed on 11-23-2006)2
10.4
 
Translated Listing Agreement signed with Tianjin Hui Hong Heavy Steel Construction Co., Ltd (signed on 12-03-2006)2
10.5
 
Translated Listing Agreement signed with NingGuo Shunchang Machinery Co., Ltd  (signed on 01-06-2007)2
10.6
 
Translated Listing Agreement with Hefe Ginko Real Estate Company, Ltd. (signed on 07-24-2007) 4
10.7
 
Share Exchange Agreement with AREM Wine Pty, Ltd. (signed on 09-21-2007) 5
10.8
 
Listing and Consultant Agreement with AREM Wine Pty, Ltd. (signed 09-27-2007) 6
10.9
 
Translated Listing Agreement with Beijing Zhong Zhe Huang Holding Company, Ltd. (signed on 10-04-2007) 7
10.10
 
Translated Listing Agreement with Qinhuangdao Huangwei Pharmaceutical Company Limited (signed on 12-29-2007), 12
10.11
 
Translated US Listing Agreement with Anhui Wenda Educational & Investment Management Corporation (signed on 04-12-2008), 12
10.12
 
Stock Purchase Agreement with Ji-Bo Pipes & Valves Company, dated September 21, 20089
10.13
 
Stock Purchase Agreement with Aoxing Corporation, dated September 21, 20089
10.14
 
Translated US Listing Agreement with Foshan Jinkuizi Technology Limited Company (signed on 09-22-2008), 12
10.15
 
Letter Agreement with Alpha Green Energy Limited (signed on 02-18-2009), 12
10.16
 
Listing Agreement with AREM Pacific Corporation (signed on 04-30-2009), 12
10.17
 
Change in Terms Agreement between EastBridge Investment Group Corporation and Goldwater Bank, N.A. dated May 6, 2009, 12.
10.18
 
Translated Listing Agreement with SuZhou KaiDa Road Pavement Construction Company Limited (signed on 11-03-2009), 12
10.19
 
Translated Listing Agreement with Long Whole Enterprises, Ltd. (signed on 11-28-2009), 12
10.20
 
Translated Listing Agreement with Beijing Tsingda Century Education Investment and Consultancy Limited (signed on 12-24-2009), 12
10.21
 
Translated Listing Agreement with StrayArrow International Limited (dated 4-11-2010) 13
10.22
 
Translated Listing Agreement with Hangzhou Dwarf Technology Ltd. (dated 9-26-2010) 14
10.23
 
Bridge Capital Raise Agreement with FIZZA, LLC, dated December 1, 2010 (confidential treatment requested for redacted portions) 15
14.1
 
Code of Ethics for EastBridge Investment Group Corporation1
16.1
 
Letter of Jewett, Schwartz, Wolfe & Associates11
21.1
 
Subsidiaries of the Company, 12
23.1    Consent of Tarvavan, Askelson & Company, LLP 
 
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer, filed herewith.
 
Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer, filed herewith.
 
Certifications Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
99.1
 
Articles of Amendment for Name Change for EastBridge Investment Group Corporation1
———————
 
 
35

 
 
1.
Incorporated by reference filed with the Registration Statement on Form 10-SB filed with the Securities and Exchange Commission on October 30, 2006 (File No. 000-52282)

2.
Incorporated by reference filed with the Registration Statement on Form 10-SB/A filed with the Securities and Exchange Commission on February 27, 2007 (File No. 000-52282)   

3.
Incorporated by reference filed with the Registration Statement on Form S-8 filed with the Securities and Exchange Commission on June 19, 2007 (File No. 333-143878)

4.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on July 20, 2007 (File No. 000-52282)   

5.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on September 25, 2007 (File No. 000-52282)   

6.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on October 1, 2007 (File No. 000-52282)   

7.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on October 9, 2007 (File No. 000-52282)   

8.
Incorporated by reference filed with the Registration Statement on Form S-8 filed with the Securities and Exchange Commission on August 22, 2008 (File No. 333-153129)  

9.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on October 22, 2008 (File No. 000-52282)   

10.
Incorporated by reference filed with the Registration Statement on Form S-8 filed with the Securities and Exchange Commission on April 15, 2009 (File No. 333-158583)  

11.
Incorporated by reference filed with the Form 8-K/A filed with the Securities and Exchange Commission on May 18, 2009 (File No. 000-52282)   

12.
Incorporated by reference filed with the Form 10-K filed with the Securities and Exchange Commission on April 15, 2010 (File No. 000-52282)

13.
 Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on July 14, 2010 (File No. 000-52282)

14.
Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on November 12, 2010 (File No. 000-52282
 
15.
 Incorporated by reference filed with the Form 8-K filed with the Securities and Exchange Commission on December 7, 2010 (File No. 000-52282)
 
 
36

 
 
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, there unto duly authorized.

Registrant
 
EastBridge Investment Group Corporation
 
       
Date: March 30, 2012
By:
/s/ Keith Wong
 
   
Keith Wong
 
   
Chairman and Chief Executive Officer (Principal Executive Officer)
 

Date: March 30, 2012
By:
/s/ Norm Klein
 
   
Norm Klein
 
   
Chief Financial Officer, Chief Operating Officer,
 
    (Principal Financial Officer and Principal Accounting Officer)  

Pursuant to the requirements of the Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Date: March 30, 2012
By:
/s/ Keith Wong
 
   
Keith Wong
 
   
Chairman and Chief Executive Officer
 

Date: March 30, 2012
By:
/s/ Norm Klein
 
   
Norm Klein
 
   
Director, Chief Financial Officer and Chief Operating Officer,
 
    (Principal Financial Officer and Principal Accounting Officer)  
 
 
37

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
 
TABLE OF CONTENTS

   
Page
 
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM:
    F-2  
         
         
CONSOLIDATED FINANCIAL STATEMENTS:
       
Consolidated Balance Sheet at December 31, 2011 and 2010
    F-3  
         
Consolidated Statements of Operations for the years ended December 31, 2011 and 2010     F-4  
         
Consolidated Statements of Shareholders' Equity for the years ended December 31, 2011 and 2010
    F-5  
         
Consolidated Statements of Cash Flows for the years ended  December 31, 2011 and 2010     F-6  
         
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
    F-7  

 
F-1

 
 
 
REPORT OF INDEPENDENT REGISTERED ACCOUNTING FIRM

 
To the Board of Directors and Stockholders
of Eastbridge Investment Group Corporation
Scottsdale, Arizona

We have audited the accompanying consolidated balance sheets of EastBridge Investment Group Corporation (Company) and subsidiaries as of December 31, 2011 and 2010, and the related consolidated statements of income, stockholders' equity (deficit), and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.  Accordingly, we express no such opinion.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of EastBridge Investment Group Corporation as of December 31, 2011 and 2010, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed further in Note 2, the Company has incurred significant losses.  The Company's viability is dependent upon its ability to obtain future financing and the success of its future operations.  These factors raise substantial doubt about the Company's ability to continue as a going concern.  Management's plan in regard to these matters is also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Tarvaran Askelson & Company, LLP

Laguna Niguel, California
March 30, 2012
 
 
 
 
F-2

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
CONSOLIDATED BALANCE SHEETS
 
   
December 31,
 
   
2011
   
2010
 
Assets
 
Cash
  $ 602,747     $ 49,898  
Total current assets
    602,747       49,898  
                 
Investments
    942,483       1,614,082  
Total assets
  $ 1,545,230     $ 1,663,980  
                 
Liabilities and Stockholders' Deficit
                 
Liabilities:
               
Accounts payable
    189,296       298,278  
Disputed accounts payable
    208,350       213,799  
Accrued expenses
    982,003       542,119  
Line of credit
    -       18,750  
Deferred revenue
    376,104       334,871  
Advances payable to related party
    115,133       44,300  
Other current liabilities
    100,000       153,000  
Total current liabilities
    1,970,886       1,605,117  
                 
Total liabilities     1,970,886       1,605,117  
                 
Commitments and contingencies
               
                 
Stockholders' deficit:
               
Preferred stock series A, no par value, 50,000,000 shares authorized; none issued and outstanding as of December 31, 2011 and 2010, respectively
    -       -  
                 
Preferred stock series B, no par value, 50,000,000 shares authorized; none issued and outstanding as of December 31, 2011 and 2010, respectively
    -       -  
                 
Common stock, no par value, 300,000,000 shares authorized; 154,590,189 and 148,653,865 issued and outstanding as of December 31, 2011 and 2010, respectively
    6,190,051       5,672,241  
                 
Accumulated deficit
    (6,592,860 )     (5,613,378 )
Accumulated other comprehensive income (loss)
    (22,847 )     -  
Total stockholders' deficit
    (425,656 )     58,863  
                 
Total liabilities and stockholders' deficit
  $ 1,545,230     $ 1,663,980  
 
The accompanying notes are an integral part of these consolidated financial statements.
 
 
F-3

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
 
 
   
Year ended
 
   
December 31,
 
   
2011
   
2010
 
             
             
 Revenues
  $ 35,500     $ 1,741,682  
                 
Cost of services
    -       -  
                 
Gross profit
    35,500       1,741,682  
                 
Operating expenses:
               
General and administrative
    1,219,882       1,328,344  
Selling and marketing
    102,479       102,234  
         Total operating expenses
    1,322,361       1,430,578  
Operating income (loss)
    (1,286,861 )     311,104  
Other income (expense):
               
Interest expense
    (9,871 )     (486,059 )
Interest income
    52,688       -  
Other income (expense):
    477,630       -  
        Total other (income) expense
    520,447       (486,059 )
Loss before taxes, minority interest, discontinued operations
    (766,414 )     (174,955 )
                 
Income tax provision
    -       -  
Net loss
  $ (766,414 )   $ (174,955 )
                 
Other comprehensive income:
               
Unrecognized gain on investments
    (22,847 )     -  
Comprehensive net loss
  $ (789,261 )   $ -  
                 
Earnings per share:
               
  Basic and diluted:
  $ (0.01 )   $ (0.00 )
                 
Weighted average common shares outstanding:
               
  Basic and diluted:
    152,161,350       146,351,388  
 
The accompanying notes are an integral part of these consolidated financial statements.
 
 
F-4

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
 
                                       
Accumulated
             
                Preferred Stock    
Other
   
Retained
       
   
Common Stock
   
Preferred A
   
Preferred B
   
Comprehensive
   
Earnings
       
   
Shares
   
Amount
   
Shares
   
Amount
   
Shares
   
Amount
   
Income(Loss)
   
(Deficit)
   
Total
 
Balance at December 31, 2009
    140,377,339       4,560,350       -       -       -       -       -       (5,438,424 )     (878,074 )
                                                                         
                                                                         
Common stock issued to officers
    1,244,421       161,775       -       -       -       -       -       -       161,775  
                                                                         
Common stock issued for debt
    3,100,000       527,000       -       -       -       -       -       -       527,000  
                                                                         
Common stock issued to services
    3,932,105       423,116       -       -       -       -       -       -       423,116  
                                                                         
Net loss
    -       -       -       -       -       -       -       (174,954 )     (174,954 )
                                                                         
Balance at December 31, 2010     148,653,865       5,672,241       -       -       -       -       -       (5,613,378 )     58,863  
                                                                         
                                                                         
Common stock issued for debt
    1,431,600       100,212       -       -       -       -       -       -       100,212  
                                                                         
Common stock issued to services
    4,504,724       417,598       -       -       -       -       -       -       417,598  
                                                                         
Stock dividend issued
    -       -       -       -       -       -       -       (213,068 )     (213,068 )
                                                                         
Unrecognized gain on investments
    -       -       -       -       -       -       (22,847 )     -       (22,847 )
                                                                         
Net loss
    -       -       -       -       -       -       -       (766,414 )     (766,414 )
                                                                         
Balance at December 31, 2011     154,590,189     $ 6,190,051        -     $  -       -     $ -       (22,847 )   $ (6,592,860 )   $ (425,656 )
 
The accompanying notes are an integral part of these consolidated financial statements.
 
 
F-5

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
   
Year ended December 31,
 
   
2011
   
2010
 
CASH FLOWS FROM OPERATING ACTIVITIES:
           
Net loss
  $ (766,414 )   $ (174,954 )
Adjustments to reconcile net loss to net cash
               
used in operating activities:
               
Common stock issued for services
    417,598       584,890  
Value of stock received for services
    -       (1,614,082 )
Loss on the extinguishment of debt
    (52,688 )     476,961  
Value of investment stock exchanged for cash and services
    435,684       -  
Changes in operating assets and liabilities:
               
Advances receivable from related party
    -       23,322  
Accounts payables
    (108,982 )     178,291  
Accrued liabilities
    434,435       250,761  
Deferred revenue
    41,233       131,600  
Other current liabilities
    (53,000 )     53,000  
Net cash (used in) provided by operating activities
    347,866       (90,211 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Repayment of line of credit
    (18,750 )     (45,000 )
Advances from affiliate
    223,733       22,500  
Net cash provided by financing activities
    204,983       (22,500 )
                 
(DECREASE) INCREASE IN CASH
    552,849       (112,711 )
CASH, BEGINNING OF PERIOD
    49,898       162,609  
CASH, END OF PERIOD
  $ 602,747     $ 49,898  
                 
SUPPLEMENTAL CASH FLOW INFORMATION
               
                 
Interest paid
  $ 6,532     $ -  
Taxes paid
  $ -     $ 9,098  
Issuance of company stock for accrued liabilities
  $ 7,071     $ -  
Debt extinguished with issuance of company stock
  $ 152,900     $ 75,619  
 
The accompanying notes are an integral part of these consolidated financial statements.
 
 
F-6

 
 
EASTBRIDGE INVESTMENT GROUP CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
 
NOTE 1 – DESCRIPTION OF BUSINESS

EastBridge Investment Group Corporation (formally ATC Technology Corporation) (“EastBridge” or the “Company”) was incorporated in the State of Arizona on June 25, 2001.  The Company’s principal activity up through June 30, 2005 was to manufacture mobile entertainment products that provide a means to play video game consoles made by Sony, Microsoft and Nintendo, in the car, RV, SUV, van or boat with attachable viewing monitors.    
 
In 2005, EastBridge decided to exit the mobile video game market and dedicate its activities to providing investment related services in Asia, with a strong focus on the high GDP growth countries, such as China.  EastBridge is initially concentrating its efforts in the Far East (Hong Kong, mainland China, Australia) and in the United States.  The Company provides consulting services to provide viable corporate infrastructure necessary for small to medium-size companies to obtain capital to grow their business.  EastBridge structures its clients as joint ventures, wholly owned foreign enterprises, or guaranteed return ventures, and assists in locating investment banking, financial advisory and other financial services  to assist the client to become a public company in the United States or obtain joint venture partners or direct capital to grow its business. EastBridge locates consultants which assist with marketing, sales and strategic planning services for its clients to prepare them to enter the United States capital market.

EastBridge is solely concentrated in marketing consulting services to the many small to mid-size Asian and U.S. companies that require financial services to assist them in expanding in their local markets. EastBridge had twelve (12) clients as of December 31, 2011 that it is consulting with in becoming public companies, reporting pursuant to the Securities Exchange Act of 1934, as amended, in the United States and obtaining listings for their stock on a U.S. stock exchange or over-the-counter market or in finding joint venture partners or broker-dealers and/or investment bankers to help them raise capital to expand their businesses.

In January 2007, the Company formed Fiber One Limited (“Fiber One”) in Hong Kong as a wholly owned subsidiary of EastBridge to provide calibration and maintenance services to fiber optic companies in Asia, mainly in China and Japan.  On June 11, 2007, the Company distributed 5.0% of Fiber One's stock to its shareholders of record on June 11, 2007.  Accordingly, the results of Fiber One have been consolidated with those of EastBridge’s from the date of formation of Fiber One.  In December 2008, the Company discontinued operations of Fiber One and two other subsidiaries.  Accordingly, all results associated with these entities have been retroactively restated and reflected as discontinued operations in the accompanying consolidated statements of operations.
 
EastBridge has formed other subsidiaries to facilitate its clients’ entry into the US capital markets and intends to merge these subsidiaries with the operating entities of its clients in the future.  Unless otherwise noted, all such subsidiaries are inactive.
 
NOTE 2 - GOING CONCERN

As indicated in the accompanying financial statements, the Company has incurred cumulative net operating losses of $6,592,860 since inception. The Company places no assurance on the on going operations of its new subsidiaries.  So far, most of the working capital has been provided by the Company's management team members. They have done so since EastBridge's inception and have indicated their continued support for EastBridge; however, there is no assurance that additional funds will be advanced. These matters raise substantial doubt about the Company’s ability to continue as a going concern.  The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.  These financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
 
 
F-7

 

These factors raise substantial doubt about the ability of the Company to continue as a going concern.   Management plans to successfully achieve milestones in the near future with respect to the Company's client engagements which will provide them with some liquidity; however, there is no assurance that the Company will be successful.

The Company's ability to meet its obligations and continue as a going concern is dependent upon its ability to obtain additional financing, achievement of profitable operations and/or ability to achieve client listing obligations.  Although the Company plans to pursue additional financing, there can be no assurance that the Company will be able to secure financing when needed or to obtain such financing on terms satisfactory to the Company, if at all.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America.  Significant accounting policies are as follows:

Principles of Consolidation

We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements.  

These estimates and assumptions also affect the reported amounts of revenues, costs and expenses during the reporting period.  Management evaluates these estimates and assumptions on a regular basis.  Actual results could differ from those estimates.

Revenue Recognition

The Company utilizes the guidance set forth in the Securities and Exchange Commission's Staff Accounting Bulletin (SAB) No. 104, regarding the recognition, presentation and disclosure of revenue in its financial statements.  The Company engages in listing contracts with its clients which provide for the payment of fees, either in cash or equity, upon the achievement of certain milestones including the successful completion of a financial statement audit, the successful listing on a national stock exchange and the maintenance of ongoing 1934 Act registration requirements with the Securities and Exchange Commission.  In some instances, payment may be made in advance of performance; however, such payment is often refundable in the event that milestones are not reached.   The Company recognizes revenue on a systematic basis as milestones are reached in accordance with FASB’s Accounting Standards Codification (“ASC”) 605 “Revenue Recognition” Update No. 2009-13.  Such guidance stipulates that revenue be recognized for individual elements in a multiple deliverable arrangement using the relative selling price method.  The Company relies on internal estimates of the relative selling price of each element as objective third-party evidence is unattainable.
 
 
F-8

 
 
Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.  At December 31, 2011 and 2010, respectively, cash and cash equivalents include cash on hand and cash in the bank. At times, cash deposits may exceed government-insured limits.

Income Taxes

Income taxes are accounted for using the asset and liability method as prescribed by ASC 740 “Income Taxes”. Under this method, deferred income tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance would be provided for those deferred tax assets if it is more likely than not that the related benefit will not be realized.
 
A full valuation allowance has been established against all net deferred tax assets as of December 31, 2011 based on estimates of recoverability.  While the Company has optimistic plans for its business strategy, we determined that such a valuation allowance was necessary given the current and expected near term losses and the uncertainty with respect to the Company’s ability to generate sufficient profits from its business model.

Share-Based Compensation

The Company periodically uses stock-based awards, consisting of shares of common stock, to compensate certain officers and consultants.  Shares are expensed on a straight line basis over the requisite service period based on the grant date fair value, net of estimated forfeitures, if any.  Typically, stock awards are fully vested at the date of grant, so forfeitures are not applicable.

Basic and Diluted Net Loss Per Share

Net loss per share was computed by dividing the net loss by the weighted average number of common shares outstanding during the period.  The weighted average number of shares was calculated by taking the number of shares outstanding and weighing them by the amount of time that they were outstanding.  Diluted net loss per share for the Company is the same as basic net loss per share, as the inclusion of common stock equivalents would be anti-dilutive.  

Fair Value of Financial Instruments

The fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties other than in a forced sale or liquidation.

The carrying amounts of the Company’s financial instruments, including cash, accounts payable and accrued liabilities, income tax payable and related party payable approximate fair value due to their short maturities.

Reclassification

Certain prior period amounts have been reclassified to conform to current year presentations.
 
 
F-9

 
 
Recent Accounting Pronouncements

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

In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements (“ASU 2011-04”) in GAAP and International Financial Reporting Standards (“IFRS”). Under ASU 2011-04, the guidance amends certain accounting and disclosure requirements related to fair value measurements to ensure that fair value has the same meaning in GAAP and in IFRS and that their respective fair value measurement and disclosure requirements are the same. ASU 2011-04 is effective for public entities during interim and annual periods beginning after December 15, 2011. Early adoption by public entities is not permitted. The Company does not believe that the adoption of this guidance will have a material impact on the financial statements.
 
In June 2011, the FASB issued ASU 2011-05, “Presentation of Comprehensive Income” (“ASU 2011-05”). ASU 2011-05 requires companies to present the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The provisions of ASU 2011-05 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Since ASU 2011-05 only amends the disclosure requirements concerning comprehensive income, the adoption of ASU 2011-05 will not affect the consolidated financial position, results of operations or cash flows of the Company.

In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06, “Improving Disclosures about Fair Value Measurements.” ASU No. 2010-06 amends FASB Accounting Standards Codification (“ASC”) 820 and clarifies and provides additional disclosure requirements related to recurring and non-recurring fair value measurements and employers’ disclosures about postretirement benefit plan assets. This ASU is effective for interim and annual reporting periods beginning after December 15, 2009. The adoption of ASU 2010-06 did not have a material impact on the Company’s financial statements.

In January 2010, the FASB issued an amendment to ASC 820, Fair Value Measurements and Disclosure, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis.  This standard, for which the Company is currently assessing the impact, is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010.  The adoption of this standard did not have a significant impact on the Company’s consolidated financial statements.  

In February 2010, the FASB issued ASU No. 2010-09 “Subsequent Events (ASC Topic 855) “Amendments to Certain Recognition and Disclosure Requirements” (“ASU No. 2010-09”). ASU No. 2010-09 requires an entity that is an SEC filer to evaluate subsequent events through the date that the financial statements are issued and removes the requirement for an SEC filer to disclose a date, in both issued and revised financial statements, through which the filer had evaluated subsequent events. The adoption did not have an impact on the Company’s financial position and results of operations.

In April 2010, the FASB codified the consensus reached in Emerging Issues Task Force Issue No. 08-09, “Milestone Method of Revenue Recognition.” FASB ASU No. 2010-17 provides guidance on defining a milestone and determining when it may be appropriate to apply the milestone method of revenue recognition for research and development transactions. FASB ASU No. 2010-17 is effective for fiscal years beginning on or after June 15, 2010, and is effective on a prospective basis for milestones achieved after the adoption date. This ASU does not have a material impact on its financial position or results of operations.

In December 2010, FASB issued Accounting Standards Update (ASU) No. 2010-29, Business Combinations (Topic 805) – Disclosure of Supplementary Pro Forma Information for Business Combinations. If a public entity presents comparative financial statements, the entity should disclose revenue and earnings of the combined entity as though the business combination that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only. ASU 2010-29 also expands the supplementary pro forma disclosures. ASU 2010-29 is effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2010. ASU 2010-29 will only affect the Company if there are future business combinations.
 
 
F-10

 
 
In October 2009, the Financial Accounting Standards Board (“FASB”) issued FASB Accounting Standards Update 2009-13, Revenue Recognition (Topic 605)—Multiple-Deliverable Revenue Arrangements. FASB Accounting Standards Update 2009-13 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 Accounting Standards Codification (“ASC”) 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 allocated at the inception of the arrangement to all deliverables using the relative selling price method. In addition, this guidance significantly expands required disclosures related to a vendor’s multiple-deliverable revenue arrangements. FASB Accounting Standards Update 2009-13 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 Accounting Standards Update 2009-13 did not have a material impact on the Company’s results of operations or financial position.
 
NOTE 4 – OTHER LIABILITIES
 
Disputed Accounts Payable
 
At December 31, 2011 and 2010, the Company carried balances totaling $208,350 and $213,799, respectively, owed to various vendors relating to EastBridge’s former business called ATC Technology.  The Company currently considers these balances as in dispute with the vendors and is working on a resolution.
 
Other Current Liabilities
 
Other current liabilities at December 31, 2011 and 2010 consisted of $100,000 and $153,000, respectively, from deposits received from individuals and a trust which have agreed to purchase from Eastbridge a fixed number of shares of common stock in one of Eastbridge’s clients that is expected to be earned by EastBridge as part of a fee arrangement once this client's shares are publicly registered.
 
In 2010, the Company issued an aggregate of 3.1 million shares in exchange of debt owed.  Interest expensed was approximately $477,000 as the value of the stock at the time of issuance was greater than the estimated value when negotiating the number of shares needed for the outstanding debt.  This was short-term debt and was only outstanding for about a year.
 
NOTE 5 – LINE OF CREDIT / NOTES PAYABLE
 
In May 2009, the Company converted the line of credit with Goldwater Bank into a two year promissory note unsecured with a variable interest rate of Wall Street Journal Prime plus 4.0%.  The interest rate cannot be less than 8% which was the rate as of December 31, 2010.  The balance due on this promissory note as of December 31, 2011 and 2010 was $0 and $18,750, respectively.
 
NOTE 6 – LEASES

The Company is leasing office space in Scottsdale, Arizona, under a non-cancelable operating lease agreement, which expired in August 2011, and continues on a month-to-month basis.  In 2010, the Company entered into a lease agreement for housing in Beijing.  This lease is intended for the employees of the Company while in Beijing and expired December 2011.  Rent expense for the periods ended December 31, 2011 and 2010 was $87,631 and $80,231, respectively.

As of December 31, 2011, the Company does not have future minimum lease payments due under the foregoing lease agreements.
 
 
F-11

 
 
NOTE 7 – RELATED PARTY TRANSACTIONS

As of December 31, 2011 and 2010 the accrued compensation liability to the officers was $841,929 and $421,929, respectively.  In 2010, the Company reduced the accrued compensation with payroll tax liability advances receivable from the CEO and CFO in the amounts of $14,039 and $9,283.

The Company received advances from its CEO, CFO and shareholders during the course of business at a rate of 4.5% interest which is the federal long term interest rate. As of December 31, 2011 and 2010 total combined advances payable to the Company’s CEO, CFO and shareholders were $110,198 and $44,300, respectively.

The Company entered into an employment agreement with the CEO on June 1, 2005. Under the terms of the agreement the CEO will receive compensation in the amount of $240,000 annually. The Company entered into an employment agreement with its CFO on June 1, 2005. Under the terms of its agreement the CFO was to receive $84,000 in compensation annually from the inception of the agreement through January 1, 2007 at which point the consulting compensation increased to $180,000.

On April 29, 2010, the Company issued 1,244,421 shares of common stock to its two officers. 426,239 common shares were issued at $.13 for a cumulative value of $55,411 to the CEO and 818,182 common shares were issued at $.13 for a cumulative value of $106,364 to the Company’s CFO.  The common shares were issued and accepted by the Company’s officers at the closing trading price on the date of issue and were applied against the accrued balance due to the two officers for a portion of unpaid salaries through the date of issuance.  No such issuances were made in 2011.

In 2010, the Company entered into a lease agreement with the spouse of the Company’s CEO for housing in Beijing.  This lease is intended for the employees of the Company while in Beijing and expired December 2011.  Per the lease agreement the rent is to be paid in shares of the Company’s stock.  971,429 common shares were issued at $.11 per share, which was the closing trading price on the date of issue, for a cumulative value of $106,857.  The expense of this lease included in the rent expense in Note 6 for the years ended December 31, 2011 and 2010 was $55,857 and $51,000, respectively.
 
NOTE 8 – EQUITY

As of December 31, 2011, EastBridge had 154,590,189 shares of no par common stock issued and outstanding with 300,000,000 shares authorized.  

During the year ended December 31, 2011, the Company issued 3,533,295 shares of common stock to consultants for services rendered.  The Company expensed $310,741 in connection with these issuances based on the quoted market prices on the date of issuance.

During the year ended December 31, 2011, the Company issued 1,431,600 shares of common stock in exchange for debt the Company owed to a shareholder.  The Company reduced the debt by $152,900 and recorded interest income of $52,688 in connection with these issuances based on the quoted market price on the date of issuance.

During the year ended December 31, 2011, the Company issued 971,429 shares of common stock to the CEO’s spouse per the lease agreement described in Note 7.  The Company expensed $106,857 in connection with these issuances based on the quoted market prices on the dates of issuance.
 
 
F-12

 
 
During the year ended December 31, 2010, the Company issued 3,932,205 shares of common stock to consultants for services rendered.  The Company expensed $423,116 in connection with these issuances based on the quoted market prices on the date of issuance.

During the year ended December 31, 2010, Company issued 1,244,421 shares of common stock to its two officers of which 426,239 shares were issued to the CEO and 818,182 shares were issued to the CFO.  The common shares were issued and accepted by the Company’s officers at the closing trading price of the date of issue of $.13 for a cumulative value of $161,775.  The Company reduced the value of the accrued compensation due to the two officers by $161,775.

During the year ended December 31, 2010, the Company issued 3,100,000 shares of common stock in exchange for debt the Company owed to shareholders.  The Company reduced the debt by $50,040 and recorded interest expense of $476,960 in connection with these issuances based on the quoted market price on the date of issuance.
 
NOTE 9 – INCOME TAXES

The provision (benefit) for income taxes from continued operations for the years ended December 31, 2011 and 2010, consist of the following:
 
   
December 31,
2011
   
December 31,
2010
 
Current:                
Federal   $ -     $ -  
State
    -       -  
                 
Deferred:
               
Federal
  $ 260,581     $ 4,481  
State     42,153       725  
      302,734       5,206  
Change in                
valuation allowance     (302,734 )     (5,206 )
Provision for income taxes, net   $ -     $ -  
  
The difference between income tax expense computed by applying the federal statutory corporate tax rate and actual income tax expense is as follows:
 
   
December 31,
2011
   
December 31,
2010
 
Statutory federal income tax rate
    34.00 %     34.00 %
State income taxes and other
    5.50 %     5.50 %
                 
Effective tax rate
    39.50 %     39.50 %
 
Deferred income taxes result from temporary differences in the recognition of income and expenses for the financial reporting purposes and for tax purposes. The tax effect of these temporary differences representing deferred tax asset and liabilities result principally from the following:
 
 
F-13

 
 
   
December 31,
2011
   
December 31,
2010
 
Net operating loss carryforward
    3,046,593       2,280,179  
Valuation allowance
    (3,046,593 )     (2,280,179 )
                 
Deferred income tax asset
    -       -  
 
The Company has a net operating loss carry forward of approximately $6,114,000 available to offset future taxable income through 2031.
 
NOTE 10 – DEFERRED REVENUE

The following table represents the balance of deferred revenue that has not yet been recognized under the Company’s revenue recognition policies:
 
   
December 31,
   
December 31,
 
   
2011
   
2010
 
                 
Jinkuizi Science & Technology Company
    (45,000 )     (45,000 )
                 
Alpha Green Energy Company
    (112,212 )     (112,212 )
                 
Kadia
    (73,000 )     (73,000 )
                 
Huang Wei
    (9,559 )     (9,559 )
                 
Arem Pacific
    (50,485 )     (50,485 )
                 
Dwarf Technologies
    (75,814 )     (44,615 )
                 
Long When
    (10,035 )     -  
                 
Deferred Revenue     (376,104 )     (334,871 )
 
NOTE 11 – COMMITMENTS AND CONTINGENCIES
 
Employment Agreements
 
On June 1, 2005, we entered into an employment agreement with Keith Wong, our President and Chief Executive Officer. The agreement provides for annual compensation in the amount of $240,000, effective June 1, 2005.  Mr. Wong’s agreement contains confidentiality, non-compete, and good faith cooperation covenants. The agreement may not be terminated by either party except with cause on the part of the Company, upon the occurrence of Mr. Wong's death, disability, bankruptcy or incompetency, or with the mutual consent of both parties.
 
On June 1, 2005, we entered into an employment agreement with Norm Klein, our Chief Financial Officer, Chief Operating Officer and Investor Relations Officer. The agreement provides for annual compensation in the amount of $84,000, effective on June 1, 2005 and was increased to an annual compensation of $180,000, effective January 1, 2007.  Mr. Klein’s agreement contains confidentiality, non-compete and good faith cooperation covenants. The agreement may not be terminated by either party except with cause on the part of the Company, upon the occurrence of Mr. Klein's death, disability, bankruptcy or incompetency, or with the mutual consent of both parties.
 
 
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NOTE 12 – STOCK BASED COMPENSATION
 
2009 Stock Option Plan
 
During the first quarter of 2009, the Company's Board of Directors approved and adopted the 2009 Stock Option Plan  (the "Plan") and designated 10,000,000 of its no par common stock for issuance under the Plan to employees, directors or consultants of EastBridge through either the issuance of shares or stock option grants.  Under the terms of the Plan, stock option grants shall be made with exercise prices not less than 100% of the fair market value of the shares of common stock on the grant date.  During 2009 and 2010, the Company issued approximately4.5 and 3.2 million shares respectively,  of common stock under the plan.  These grants were not stock options but instead represent fully vested shares at the date of grant.
 
  
 
Total shares
reserved
under the
plan
   
Remaining
shares available for issuance
under the
plan
 
2009 Stock Option Plan
   
10,000,000
     
679,290
 
 
2011 Incentive Stock Option Plan
 
During the last quarter of 2011, the Company's Board of Directors approved and adopted the 2011 Incentive Stock Option Plan  (the "2011 Plan") and designated 30,000,000 of its no par common stock for issuance under the 2011 Plan to employees, directors or consultants of EastBridge through either the issuance of shares or stock option grants.  Under the terms of the 2011Plan, stock option grants shall be made with exercise prices not less than 100% of the fair market value of the shares of common stock on the grant date.  As of December 31, 2011, the Company did not issue any common stock or grant any option under the 2011 Plan.
 
 
 
Total shares
reserved
under the
plan
 
 
Remaining
shares available for issuance
under the
plan
 
2011 Incentive Stock Option Plan
 
 
30,000,000
 
 
 
30,000,000
 
 
NOTE 13 – SEGMENT INFORMATION
 
The Company operates only one reporting segment.  Substantially all assets are contained in the United States.  Although the Company’s business is assisting foreign companies with accessing the US capital markets, substantially all revenue generating activities are conducted in the United States.
 
NOTE 14 – SUBSEQUENT EVENTS

The Company entered into listing agreements with American C&D Logisitics, LLC and PhotoFunds, Inc as of March 12, 2012.  Also, a new listing and joint venture agreements as of February 1, 2012 with International Air Medical Services (IAMS) in addition to an updated consulting agreement (capital raise) with IAMS.
 
On March 7, 2012, the Company filed a Form S-8 registration statement for an aggregate amount of 30,000,000 shares of common stock. The 30,000,000 shares will be issued upon the exercise of options or upon the issuance of restricted stock awards or other awards otherwise granted hereafter pursuant to EastBridge Investment Group Corporation’s 2011 Plan.  The maximum number of shares which may be sold upon the exercise of such options or issuance of stock awards granted under the 2011 Plan are subject to adjustment in accordance with certain anti-dilution and other provisions under the 2011 Plan.
 
 
 
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