----

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**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      DC 20549**

**FORM      10-QSB**

|   | SHARP                  HOLDING                  CORPORATION                      |   |
|--------|----------------------------------------------------------------------------------|--------|
|   | (Name                  of                  Small Business Issuer in Its Charter) |   |

|   | DELAWARE                                                                                                    |   | 65-0970516                                                                     |   |
|--------|-------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------|--------|
|   | (State                or                Other Jurisdiction of Incorporation                or Organization) |   | (IRS                Employer                Identification                No.) |   |

|   | 13231                  CHAMPION FOREST DRIVE, SUITE 213, HOUSTON, TEXAS 77069                                                  |   |
|--------|--------------------------------------------------------------------------------------------------------------------------------|--------|
|   | (Address                  of                  Principal Executive Offices)     (Zip                  Code) |   |

|   | (713)                  960-9100                                         |   |
|--------|-------------------------------------------------------------------------|--------|
|   | (Issuer’s                  Telephone Number, Including Area code) |   |

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**TABLE      OF CONTENTS**

| PART                I  |                                                                                           |
|------------------------|------------------------------------------------------------------------------------------------|
|                   |                                                                                           |
| Item                1. | Financial                Statements                                                            |
|                   |                                                                                           |
| Item                2. | Management’s                Discussion and Analysis or Plan of                Operations |
|                   |                                                                                           |
| Item                3. | Controls                and Procedures                                                         |
|                   |                                                                                           |
|                   |                                                                                           |
| PART                II |                                                                                           |
|                   |                                                                                           |
| Item                2. | Unregistered                Sales of Equity Securities and Use of                Proceeds      |
|                   |                                                                                           |
| Item                6. | Exhibits                                                                                       |

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*Table          of Contents*

**PART      I**

| **ITEM                  1.** | **FINANCIAL                  STATEMENTS** |
|------------------------------|-------------------------------------------|

Consolidated        Balance Sheets as of

June        30, 2005 (unaudited) and December 31,        2004

Consolidated        Statements of Operations for the three        months

and        six months ended June 30, 2005 and 2004        (unaudited)

Consolidated        Statement of Stockholders’ Deficit for        the 

six        months ended June 30, 2005        (unaudited)

Consolidated        Statements of Cash Flows for the

six        months ended June 30, 2005 and 2004        (unaudited)

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND      SUBSIDIARIES**

**CONSOLIDATED      BALANCE SHEETS**

**June      30,      2005 and December 31, 2004**

**__________**

|                                                                                                                                                                                                  |   | **June                30,****2005** |        | **December                31,****2004** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------|-------------|-----------------------------------------|--------|
| **ASSETS**                                                                                                                                                                                            |   | **(Unaudited)**                     |        | **(Note)**                              |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |
| Current                assets:                                                                                                                                                                        |   |                                |        |                                    |   |
| Cash                and cash                equivalents                                                                                                                                               |   | $                                   | -           |                                    | $      | 35,074 |   |
| Accounts                receivable                                                                                                                                                                    |   |                                | 1,600       |                                    |   | - |   |
| Other                current                assets                                                                                                                                                    |   |                                | 34,553      |                                    |   | 42,700 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                current                assets                                                                                                                                                    |   |                                | 36,153      |                                    |   | 77,774 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Property                and                equipment, net                                                                                                                                             |   |                                | 46,817      |                                    |   | 56,348 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Deferred                technology license, net                                                                                                                                                       |   |                                | 117,085     |                                    |   | 180,955 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Other                noncurrent assets                                                                                                                                                                |   |                                | 16,152      |                                    |   | 16,152 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                assets                                                                                                                                                                           |   | $                                   | 216,207     |                                    | $      | 331,229 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS' EQUITY (DEFICIT)**                                                                                                                                     |   |                                |        |                                    |   |   |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Current                liabilities:                                                                                                                                                                   |   |                                |        |                                    |   |   |   |
| Cash                overdraft                                                                                                                                                                         |   | $                                   | 8,447       |                                    | $      | - |   |
| Accounts                payable                                                                                                                                                                       |   |                                | 679,652     |                                    |   | 657,400 |   |
| Accrued                payroll taxes                                                                                                                                                                  |   |                                | 322,253     |                                    |   | 322,253 |   |
| Accrued                payroll and contract labor                                                                                                                                                     |   |                                | 698,337     |                                    |   | 635,897 |   |
| Other                accrued                liabilities                                                                                                                                               |   |                                | 1,042,860   |                                    |   | 778,568 |   |
| Notes                payable                to related parties                                                                                                                                        |   |                                | 930,259     |                                    |   | 1,006,315 |   |
| Notes                payable                                                                                                                                                                          |   |                                | 1,169,844   |                                    |   | 1,530,844 |   |
| Deferred                revenue                                                                                                                                                                       |   |                                | 274,485     |                                    |   | 224,485 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                current                liabilities                                                                                                                                               |   |                                | 5,126,137   |                                    |   | 5,155,762 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Long                term                notes payable                                                                                                                                                 |   |                                | 66,532      |                                    |   | 68,222 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                liabilities                                                                                                                                                                      |   |                                | 5,192,669   |                                    |   | 5,223,984 |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Commitments                and contingencies                                                                                                                                                          |   |                                |        |                                    |   |   |   |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Stockholders’                equity (deficit):                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Common                stock,                $.001 par value, 80,000,000 shares authorized, 64,722,618 shares                and                27,075,452 shares issued and outstanding, respectively |   |                                | 64,723      |                                    |   | 27,076 |   |
| Additional                paid-in capital                                                                                                                                                             |   |                                | 10,286,126  |                                    |   | 8,610,718 |   |
| Accumulated                deficit                                                                                                                                                                    |   |                                | (15,327,311 | )                                       |   | (13,530,549 | ) |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                stockholders’ equity (deficit)                                                                                                                                             |   |                                | (4,976,462  | )                                       |   | (4,892,755 | ) |
|                                                                                                                                                                                                  |   |                                |        |                                    |   |   |   |
| Total                liabilities and stockholders’ equity (deficit)                                                                                                                             |   | $                                   | 216,207     |                                    | $      | 331,229 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND      SUBSIDIARIES**

**UNAUDITED      CONSOLIDATED STATEMENTS OF OPERATIONS**

**for      the      three months and six months ended June 30, 2005 and 2004**

**__________**

|                                                                                                         |   | **Three                Months Ended** |       | **Six                Months Ended** |   |
|--------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|------------|-------------------------------------|--------|
|                                                                                                         |   | **June                30,**           |       | **June                30,**         |   |
|                                                                                                         |   | **2005**                              |       | **2004**                            |   | **2005** |   | **2004** |   |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |
| Revenues                                                                                                     |   | $                                     | 14,853     |                                | $      | 19,636 |   | $ | 19,888 |   | $ | 41,720 |   |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Operating                expenses:                                                                           |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Cost                of sales                and services                                                     |   |                                  | 54,218     |                                |   | 48,290 |   |   | 107,032 |   |   | 94,910 |   |
| Selling,                general and administrative                                                           |   |                                  | 569,701    |                                |   | 513,071 |   |   | 1,185,178 |   |   | 821,065 |   |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Total                operating expenses                                                                      |   |                                  | 623,919    |                                |   | 561,361 |   |   | 1,292,210 |   |   | 915,975 |   |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Loss                from                operations                                                           |   |                                  | (609,066   | )                                   |   | (541,725 | ) |   | (1,272,322 | ) |   | (874,255 | ) |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Interest                expense                                                                              |   |                                  | (287,225   | )                                   |   | (32,753 | ) |   | (824,440 | ) |   | (56,231 | ) |
| Gain                on                settlement of lawsuit                                                  |   |                                  | -          |                                |   | - |   |   | 300,000 |   |   | - |   |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Net                loss                                                                                      |   | $                                     | (896,291   | )                                   | $      | (574,478 | ) | $ | (1,796,762 | ) | $ | (930,486 | ) |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Basic                and                diluted net loss per share                                           |   | $                                     | (0.02      | )                                   | $      | (0.02 | ) | $ | (0.05 | ) | $ | (0.04 | ) |
|                                                                                                         |   |                                  |       |                                |   |   |   |   |   |   |   |   |   |
| Weighted                average shares used in computing basic and diluted net loss per                share |   |                                  | 40,848,238 |                                |   | 25,857,547 |   |   | 34,346,463 |   |   | 25,674,811 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND      SUBSIDIARIES**

**UNAUDITED      CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)**

**for      the six      months ended June 30, 2005**

**__________**

|                                                                                                   |   |                              |       |        |   |            |   |        |       | **Total**               |   |
|--------------------------------------------------------------------------------------------------------|--------|-----------------------------------|------------|-------------|--------|-----------------|--------|-------------|------------|-------------------------|--------|
|                                                                                                   |   |                              |       |        |   | **Additional**  |   |        |       | **Stockholders’** |   |
|                                                                                                   |   | **Common                  Stock** |       | **Paid-In** |   | **Accumulated** |   | **Equity**  |       |
|                                                                                                   |   | **Shares**                        |       | **Value**   |   | **Capital**     |   | **Deficit** |       | **(Deficit)**           |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |
| Balance                  at                  December 31, 2004                                         |   |                              | 27,075,452 |        | $      | 27,076          |   | $           | 8,610,718  |                    | $      | (13,530,549 | ) | $ | (4,892,755 | ) |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Issuance                  of                  common stock on exercise of warrants                     |   |                              | 310,731    |        |   | 311             |   |        | 50,796     |                    |   | - |   |   | 51,107 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Issuance                  of                  common stock and warrants as compensation to consultants |   |                              | 1,325,000  |        |   | 1,325           |   |        | 141,302    |                    |   | - |   |   | 142,627 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Issuance                  of                  warrants in conjunction with notes payable agreements    |   |                              | -          |        |   | -               |   |        | 95,082     |                    |   | - |   |   | 95,082 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Effect                  of                  beneficial conversion feature                              |   |                              | -          |        |   | -               |   |        | 204,918    |                    |   | - |   |   | 204,918 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Issuance                  of                  common stock in settlement of debt                       |   |                              | 13,785,015 |        |   | 13,785          |   |        | 497,616    |                    |   | - |   |   | 511,401 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Issuance                  of                  common stock upon election to convert notes payable      |   |                              | 22,226,420 |        |   | 22,226          |   |        | 685,694    |                    |   | - |   |   | 707,920 |   |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Net                  loss                                                                              |   |                              | -          |        |   | -               |   |        | -          |                    |   | (1,796,762 | ) |   | (1,796,762 | ) |
|                                                                                                   |   |                              |       |        |   |            |   |        |       |                    |   |   |   |   |   |   |
| Balance                  at                  June 30, 2005                                             |   |                              | 64,722,618 |        | $      | 64,723          |   | $           | 10,286,126 |                    | $      | (15,327,311 | ) | $ | (4,976,462 | ) |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND      SUBSIDIARIES**

**UNAUDITED      CONSOLIDATED STATEMENTS OF CASH FLOWS**

**for      the six      months ended June 30, 2005 and 2004**

**__________**

|                                                                                                                          |   | **2005** |       | **2004** |   |
|-------------------------------------------------------------------------------------------------------------------------------|--------|----------|------------|----------|--------|
|                                                                                                                          |   |     |       |     |   |
| Cash                flows                from operating activities:                                                           |   |     |       |     |   |
| Net                loss                                                                                                       |   | $        | (1,796,762 | )        | $      | (930,486 | ) |
| Adjustments                to reconcile net loss to net cash provided by (used in) operating                activities-       |   |     |       |     |   |   |   |
| Stock-based                consideration for services and financing costs                                                     |   |     | 142,627    |     |   | - |   |
| Reduction                of                note receivable in lieu of compensation                                            |   |     | -          |     |   | 17,000 |   |
| Amortization                of debt discount                                                                                  |   |     | 706,221    |     |   | 130,300 |   |
| Depreciation                and amortization                                                                                  |   |     | 77,024     |     |   | 66,300 |   |
| Changes                in                operating assets and liabilities-                                                    |   |     |       |     |   |   |   |
| Increase                in                accounts receivable                                                                 |   |     | (1,600     | )        |   | - |   |
| Decrease                in                other current assets                                                                |   |     | 8,147      |     |   | - |   |
| Increase                in                accounts payable and accrued liabilities                                            |   |     | 388,841    |     |   | 446,407 |   |
| Increase                (Decrease) in deferred revenue                                                                        |   |     | 50,000     |     |   | (5,515 | ) |
|                                                                                                                          |   |     |       |     |   |   |   |
| Net                cash used                in operating activities                                                           |   |     | (425,502   | )        |   | (275,994 | ) |
|                                                                                                                          |   |     |       |     |   |   |   |
| Cash                flows                from investing activities:                                                           |   |     |       |     |   |   |   |
| Purchases                of                property, plant and equipment                                                      |   |     | (3,623     | )        |   | (4,571 | ) |
|                                                                                                                          |   |     |       |     |   |   |   |
| Net                cash used                in investing activities                                                           |   |     | (3,623     | )        |   | (4,571 | ) |
|                                                                                                                          |   |     |       |     |   |   |   |
| Cash                flows                from financing activities:                                                           |   |     |       |     |   |   |   |
| Proceeds                from                issuance of common stock                                                          |   |     | 51,107     |     |   | 30,000 |   |
| Proceeds                from                borrowings                                                                        |   |     | 495,000    |     |   | 835,000 |   |
| Repayment                of                borrowings                                                                         |   |     | (152,056   | )        |   | (56,053 | ) |
|                                                                                                                          |   |     |       |     |   |   |   |
| Net                cash                provided by financing activities                                                       |   |     | 394,051    |     |   | 808,947 |   |
|                                                                                                                          |   |     |       |     |   |   |   |
| Net                (decrease) increase in cash and cash equivalents                                                           |   |     | (35,074    | )        |   | 528,382 |   |
|                                                                                                                          |   |     |       |     |   |   |   |
| Cash                and cash                equivalents at beginning of period                                                |   |     | 35,074     |     |   | 7,479 |   |
|                                                                                                                          |   |     |       |     |   |   |   |
| Cash                and cash                equivalents at end of period                                                      |   | $        | -          |     | $      | 535,861 |   |
|                                                                                                                          |   |     |       |     |   |   |   |
| Supplemental                disclosure of cash flow information:                                                              |   |     |       |     |   |   |   |
| Cash                paid for                interest                                                                          |   | $        | 765        |     | $      | 4,008 |   |
|                                                                                                                          |   |     |       |     |   |   |   |
| Supplemental                disclosure of noncash investing and financing activities:                                         |   |     |       |     |   |   |   |
| Issuance                of                warrants in conjunction with notes payable agreements                               |   | $        | 95,082     |     | $      | - |   |
| Beneficial                conversion feature on notes payable                                                                 |   | $        | 204,918    |     | $      | - |   |
| Issuance                of                common stock upon election to convert notes payable                                 |   | $        | 707,920    |     | $      | - |   |
| Issuance                of                common stock & warrants for notes payable & accrued                interest |   | $        | 121,000    |     | $      | - |   |
| Issuance                of                common stock in settlement of debt                                                  |   | $        | 511,401    |     | $      | - |   |
| Conversion                of                accrued liabilities for notes payable                                             |   | $        | -          |     | $      | 470,000 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **1.** | **Basis                Of Presentation** |
|--------|------------------------------------------|

| **2.** | **Organization                and Operations** |
|--------|------------------------------------------------|

| **3.** | **Notes                Payable** |
|--------|----------------------------------|

|                                                                                                                                             |   | **2005** |    | **2004** |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|---------|----------|--------|
| Note                payable                to an individual, bearing interest of 10%per year, payable on demand,                uncollateralized |   | $        | 245,000 |     | $      | 245,000 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **3.** | **Notes                Payable, continued** |
|--------|---------------------------------------------|

| Note                  payable                  to an individual                                                                                                                                                                                                                                                                                                                                                                                                        |   |   | 465,000   |   |   | 465,000   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|-----------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Note                  payable                  to a company, bearing interest of 12% per year, payable on December                  31,                  2003, uncollateralized                                                                                                                                                                                                                                                                                        |   |   | 75,000    |   |   | 75,000    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Note                  payable                  to a company, bearing interest of 6% per year, payable on May 31,                  2005,                  uncollateralized                                                                                                                                                                                                                                                                                              |   |   | -         |   |   | 370,000   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Notes                  payable                  to one company and one individual, bearing interest of 8% per year,                  payable in May and June 2005, collateralized by 630,000 shares                  of the                  Company’s common stock                                                                                                                                                                                              |   |   | 210,000   |   |   | 210,000   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Callable                  convertible secured notes payable to four companies, bearing interest                  of                  8%, maturing in November 2006 through January 2007, collateralized                  by                  substantially all assets and intellectual property as well as registration                  rights, net of debt discount of $225,547 at June 30, 2005 and $631,778                  at                  December 31, 2004 |   |   | 66,532    |   |   | 68,222    |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Note                  payable                  to an individual, due June 21. 2005                                                                                                                                                                                                                                                                                                                                                                                     |   |   | 10,000    |   |   | -         |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
| Notes                  payable                  to two companies and one individual, non-interest bearing, due                  in monthly                  installments, with maturities in 2003 and 2004                                                                                                                                                                                                                                                             |   |   | 164,844   |   |   | 165,844   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   |      |   |   |           |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | $      | 1,236,376 |   | $      | 1,599,066 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **3.** | **Notes                Payable, continued** |
|--------|---------------------------------------------|

| **4.** | **Related-Party                Transactions** |
|--------|-----------------------------------------------|

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **4.** | **Related-Party                Transactions,                continued** |
|--------|-------------------------------------------------------------------------|

| **5.** | **Commitments                and Contingencies** |
|--------|--------------------------------------------------|

| **6.** | **Segment                Reporting** |
|--------|--------------------------------------|

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **6.** | **Segment                Reporting, continued** |
|--------|-------------------------------------------------|

|                                                           |   | **Other****Technology** |    | **Reserve** |   | **Scan** |   | **Totals** |     |
|----------------------------------------------------------------|--------|-------------------------|---------|-------------|--------|----------|--------|------------|----------|
|                                                           |   |                    |    |        |   |     |   |       |     |
| Revenues                from                external customers |   | $                       | 13,248  |        | $      | -        |   | $          | 1,605    |   | $ | 14,853 |   |
| Segment                loss                                    |   |                    | (27,108 | )           |   | (68,641  | )      |       | (379,508 | ) |   | (475,254 | ) |
| Segment                assets                                  |   |                    | 119,337 |        |   | 45,867   |   |       | 15,862   |   |   | 181,066 |   |

|                                                           |   | **Other****Technology** |    | **Reserve** |   | **Scan** |   | **Totals** |   |
|----------------------------------------------------------------|--------|-------------------------|---------|-------------|--------|----------|--------|------------|--------|
|                                                           |   |                    |    |        |   |     |   |       |   |
| Revenues                from                external customers |   | $                       | 19,636  |        | $      | -        |   | $          | -      |   | $ | 19,636 |   |
| Segment                loss                                    |   |                    | (29,358 | )           |   | (400,482 | )      |       | (9,525 | ) |   | (439,365 | ) |
| Segment                assets                                  |   |                    | 247,938 |        |   | 509,355  |   |       | 475    |   |   | 757,768 |   |

|                                                                     |   | **2005** |     | **2004** |   |
|--------------------------------------------------------------------------|--------|----------|----------|----------|--------|
| **Profit                or Loss**                                        |   |     |     |     |   |
| Total                loss                for reportable segments         |   | $        | (475,254 | )        | $      | (439,365 | ) |
| Corporate                interest expense                                |   |     | (252,320 | )        |   | (24,994 | ) |
| Gain                on                settlement of corporate payables   |   |     | -        |     |   | - |   |
| Loss                from                discontinued operations          |   |     | -        |     |   | - |   |
| Intercompany                management fees                              |   |     | -        |     |   | 50,000 |   |
| Unallocated                corporate general and administrative expenses |   |     | (168,717 | )        |   | (160,119 | ) |
|                                                                     |   |     |     |     |   |   |   |
| Loss                before                income taxes                   |   | $        | (896,291 | )        | $      | (574,478 | ) |
|                                                                     |   |     |     |     |   |   |   |
| **Assets**                                                               |   |     |     |     |   |   |   |
| Total                assets                for reportable segments       |   | $        | 181,066  |     | $      | 757,768 |   |
| Assets                held                by corporate:                  |   |     |     |     |   |   |   |
| Cash                                                                     |   |     | -        |     |   | 30,122 |   |
| Other                current                assets                       |   |     | 34,553   |     |   | - |   |
| Other                assets                                              |   |     | 588      |     |   | 588 |   |
|                                                                     |   |     |     |     |   |   |   |
| Total                consolidated assets                                 |   | $        | 216,207  |     | $      | 788,478 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **6.** | **Segment                Reporting, continued** |
|--------|-------------------------------------------------|

|                                                           |   | **Other****Technology** |    | **Reserve** |   | **Scan** |   | **Totals** |     |
|----------------------------------------------------------------|--------|-------------------------|---------|-------------|--------|----------|--------|------------|----------|
|                                                           |   |                    |    |        |   |     |   |       |     |
| Revenues                from                external customers |   | $                       | 18,072  |        | $      | -        |   | $          | 1,815    |   | $ | 19,887 |   |
| Segment                loss                                    |   |                    | (62,634 | )           |   | (156,954 | )      |       | (679,869 | ) |   | (899,457 | ) |

|                                                           |   | **Other****Technology** |    | **Reserve** |   | **Scan** |   | **Totals** |   |
|----------------------------------------------------------------|--------|-------------------------|---------|-------------|--------|----------|--------|------------|--------|
|                                                           |   |                    |    |        |   |     |   |       |   |
| Revenues                from                external customers |   | $                       | 41,720  |        | $      | -        |   | $          | -      |   | $ | 41,720 |   |
| Segment                loss                                    |   |                    | (55,723 | )           |   | (400,482 | )      |       | (9,525 | ) |   | (465,730 | ) |

|                                                                     |   | **2005** |       | **2004** |   |
|--------------------------------------------------------------------------|--------|----------|------------|----------|--------|
|                                                                     |   |     |       |     |   |
| Total                loss                for reportable segments         |   | $        | (899,457   | )        | $      | (465,730 | ) |
| Corporate                interest expense                                |   |     | (770,836   | )        |   | (48,472 | ) |
| Gain                on                settlement of lawsuit              |   |     | 300,000    |     |   | - |   |
| Intercompany                management fees                              |   |     | -          |     |   | 50,000 |   |
| Unallocated                corporate general and administrative expenses |   |     | (426,469   | )        |   | (466,284 | ) |
|                                                                     |   |     |       |     |   |   |   |
| Loss                before                income taxes                   |   | $        | (1,796,762 | )        | $      | (930,486 | ) |

| **7.** | **Settlement                of Lawsuit** |
|--------|------------------------------------------|

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **8.** | **Stock                Options and Warrants** |
|--------|-----------------------------------------------|

|                                                    |   | **Number                of****Shares** |      | **Exercisable** |   | **Exercise****Price** |   | **Weighted****Average****Exercise****Price** |        |
|---------------------------------------------------------|--------|----------------------------------------|-----------|-----------------|--------|-----------------------|--------|----------------------------------------------|-------------|
|                                                    |   |                                   |      |            |   |                  |   |                                         |        |
| Options                outstanding at December 31, 2004 |   |                                   | 3,156,469 |            |   | 3,156,469             |   | $                                            | 0.10-$15.00 |   |   | $0.39 |   |
|                                                    |   |                                   |      |            |   |                  |   |                                         |        |   |   |   |   |
| Options                expired                          |   |                                   | (26,999   | )               |   | (26,999               | )      | $                                            | 5.10-$6.00  |   |   | $5.39 |   |
|                                                    |   |                                   |      |            |   |                  |   |                                         |        |   |   |   |   |
| Options                outstanding at June 30, 2005     |   |                                   | 3,129,470 |            |   | 3,129,470             |   | $                                            | 0.10-$15.00 |   |   | $0.35 |   |

| **Range                of****Exercise****Prices** |   | **Outstanding****as                of****June                30,****2005** |   | **Weighted****Average****Remaining****Contractual****Life                (In Years)** |   | **Weighted****Average****Exercise****Price** |
|---------------------------------------------------|--------|----------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------|--------|----------------------------------------------|
|                                              |   |                                                                       |   |                                                                                  |   |                                         |
| $5.10-$15.00                                      |   | 129,470                                                                    |   | 1.85                                                                                  |   | $6.12                                        |
| $0.10                                             |   | 3,000,000                                                                  |   | 3.40                                                                                  |   | $0.10                                        |
|                                              |   |                                                                       |   |                                                                                  |   |                                         |
| $0.10-$15.00                                      |   | 3,129,470                                                                  |   | 3.40                                                                                  |   | $0.35                                        |

|                                                                                   |   | **Number                of****Shares** |       | **Exercisable** |   | **Exercise****Price** |   | **Weighted****Average****Exercise****Price** |       |
|----------------------------------------------------------------------------------------|--------|----------------------------------------|------------|-----------------|--------|-----------------------|--------|----------------------------------------------|------------|
|                                                                                   |   |                                   |       |            |   |                  |   |                                         |       |
| Warrants                outstanding                at                December 31, 2004 |   |                                   | 8,864,346  |            |   | 8,864,346             |   | $                                            | 0.01-$6.00 |   |   | $0.75 |   |
|                                                                                   |   |                                   |       |            |   |                  |   |                                         |       |   |   |   |   |
| Warrants                issued                                                         |   |                                   | 3,100,000  |            |   | 3,100,000             |   | $                                            | 0.05-$0.30 |   |   | $0.34 |   |
|                                                                                   |   |                                   |       |            |   |                  |   |                                         |       |   |   |   |   |
| Warrants                exercised                                                      |   |                                   | (200,000   | )               |   | (200,000              | )      | $                                            | 0.25       |   |   | $0.25 |   |
|                                                                                   |   |                                   |       |            |   |                  |   |                                         |       |   |   |   |   |
| Warrants                expired/forfeited                                              |   |                                   | (978,333   | )               |   | (978,333              | )      | $                                            | 0.05-$6.00 |   |   | $1.07 |   |
|                                                                                   |   |                                   |       |            |   |                  |   |                                         |       |   |   |   |   |
| Warrants                outstanding at June 30, 2005                                   |   |                                   | 10,786,013 |            |   | 10,786,013            |   | $                                            | 0.01-$6.00 |   |   | $0.58 |   |

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*Table          of Contents*

**SHARP      HOLDING CORPORATION AND SUBSIDIARIES**

**NOTES      TO      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**__________**

| **8.** | **Stock                Options and Warrants,                continued** |
|--------|-------------------------------------------------------------------------|

| **Range                of****Exercise****Prices** |   | **Outstanding****as                of****June                30,****2005** |   | **Weighted****Average****Remaining****Contractual****Life                (In Years)** |   | **Weighted****Average****Exercise****Price** |
|---------------------------------------------------|--------|----------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------|--------|----------------------------------------------|
|                                              |   |                                                                       |   |                                                                                  |   |                                         |
| $0.01-$0.25                                       |   | 9,105,459                                                                  |   | 2.20                                                                                  |   | $0.15                                        |
| $0.50-$1.00                                       |   | 700,000                                                                    |   | 2.50                                                                                  |   | $0.82                                        |
| $3.00-$6.00                                       |   | 980,554                                                                    |   | 3.20                                                                                  |   | $4.45                                        |
|                                              |   |                                                                       |   |                                                                                  |   |                                         |
|                                              |   | 10,786,013                                                                 |   | 2.30                                                                                  |   | $0.58                                        |

|                                             |   | **June                30,2005** |   | **June                30,2004** |   |
|--------------------------------------------------|--------|---------------------------------|--------|---------------------------------|--------|
|                                             |   |                            |   |                            |   |
| Dividend                yield                    |   |                            | -0-    | %                               |   | -0- | % |
| Expected                volatility               |   |                            | 200    | %                               |   | 200 | % |
| Risk                free                interest |   |                            | 5      | %                               |   | 5 | % |
| Expected                lives                    |   |                            | Actual |                            |   | Actual |   |

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*Table          of Contents*

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

**FORWARD      LOOKING STATEMENTS AND INFORMATION**

**OPERATIONS**

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*Table          of Contents*

**RESULTS      OF      OPERATIONS FOR THE THREE AND SIX-MONTH PERIODS ENDED JUNE 30, 2005 AND      2004**

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*Table          of Contents*

**LIQUIDITY      AND CAPITAL RESOURCES**

**New      Accounting Pronouncements**

**CRITICAL      ACCOUNTING POLICIES**

**Revenue      Recognition**

**Accounting      for Stock-Based Compensation**

**ITEM      3.** **CONTROLS      AND PROCEDURES**

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*Table          of Contents*

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*Table          of Contents*

**PART      II**

**ITEM            2.  **
**UNREGISTERED            SALES OF EQUITY SECURITIES AND USE OF            PROCEEDS**

|   | (1) | Each                of the                persons who received these unregistered securities had knowledge                and                experience in financial and business matters which allowed them to                evaluate the merits and risk of the receipt of these securities,                and that                they were knowledgeable about our operations and financial                condition. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | No                underwriter participated in, nor did we pay any commissions or fees                to any                underwriter in connection with the                transactions. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | No                transaction involved a public                offering. |
|--------|-----|--------------------------------------------------------------------------|

|   | (4) | Each                certificate issued for these unregistered securities contained a                legend                stating that the securities have not been registered under the Act                and                setting forth the restrictions on the transferability and the sale                of the                securities. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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*Table            of Contents*

**ITEM            6.  **
**EXHIBITS**

| Exhibit                  No. | Identification                  of Exhibit                                                                                               |
|------------------------------|------------------------------------------------------------------------------------------------------------------------------------------|
|                         |                                                                                                                                     |
| 31.1                         | Certification                  of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley                  Act of 2002     |
|                         |                                                                                                                                     |
| 31.2                         | Certification                  of Principal Financial Officer Pursuant to Section 302 of the                  Sarbanes-Oxley Act of 2002 |
|                         |                                                                                                                                     |
| 32.1                         | Certification                  of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley                  Act of 2002     |
|                         |                                                                                                                                     |
| 32.2                         | Certification                  of Principal Financial Officer Pursuant to Section 906 of the                  Sarbanes-Oxley Act of 2002 |

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*Table          of Contents*

**SIGNATURES**

| By:                  /s/                  George Sharp                             |   | August                  22,                  2005 |
|------------------------------------------------------------------------------------|--------|---------------------------------------------------|
| George                  Sharp,                  Director, Chief Executive Officer, |   |                                              |
| Principal                  Financial Officer and President                         |   |                                              |

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