UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 2004
(August 31, 2004)
BF ACQUISITION GROUP III, INC.
............................................................................
(Exact name of registrant as specified in its charter)
Florida 0-26849 65-0913585
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
4 Mill Park Ct., Newark, Delaware 19713
............................................................................
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (302) 366-8992
............................................................................
(Former name or former address, if changed since last report)
Item 2.01. Completion of Acquisition or Disposition of Assets
As reported on its current report on Form 8-K filed September
1, 2004, on August 31, 2004, the registrant completed the acquisition
of 425,000 shares of FundraisingDirect.com, Inc., a Delaware
corporation ("FRD"), from Mr. Justin DiNorscia and Mrs. Diane
DiNorscia, which represents approximately 92% of all of the issued and
outstanding shares of capital stock of FRD, in exchange for 3,000,000
shares of the registrant's Series A Preferred Stock.
Pursuant to Item 9.01(a)(4) of Form 8-K, this Form 8-K/A amends
the current report on Form 8-K filed September 1, 2004 to include
FRD's financial statements as required by Item 9.01(a)(4) of Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
The audited Financial Statements of FRD dated December 31, 2003
and 2002 are filed as part of this Current Report on Form 8-K/A.
(b) Pro forma financial information.
Not Applicable.
(c) Exhibits.
The following exhibits were filed as part of the Current Report
of Form 8-K filed with the Commission on September 1, 2004 and
are incorporated herein by reference:
2.1 Share Exchange Agreement
3.1 Certified Articles of Incorporation, as Amended
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
BF Acquisition Group III, Inc.
By:/s/ Justin DiNorscia
------------------------
Justin DiNorscia, President
Dated November 10, 2004
FUNDRAISINGDIRECT.COM, INC.
FINANCIAL STATEMENTS
DECEMBER 31, 2003 AND 2002
FUNDRAISINGDIRECT.COM, INC.
C O N T E N T S
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PAGE
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INDEPENDENT AUDITORS' REPORT 1
BALANCE SHEETS 2
STATEMENTS OF OPERATIONS 3
STATEMENTS OF STOCKHOLDERS' DEFICIT 4
STATEMENTS OF CASH FLOWS 5
NOTES TO FINANCIAL STATEMENTS 6 - 8
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
FundraisingDirect.com, Inc.
Newark, Delaware
We have audited the balance sheets of FundraisingDirect.com, Inc. as of
December 31, 2003 and 2002, and the related statements of operations,
stockholders' deficit and cash flows for the years then ended. These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement. 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 FundraisingDirect.com,
Inc. as of December 31, 2003 and 2002, and the results of their operations
and cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States.
/s/ Cogen Sklar, LLP
Bala Cynwyd, Pennsylvania
November 1, 2004
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FUNDRAISINGDIRECT.COM, INC.
BALANCE SHEETS
DECEMBER 31, 2003 AND 2002
2003 2002
ASSETS ---- ----
CURRENT ASSETS
Cash $ 576 $ 461
Accounts receivable 7,191 20,036
Due from officer 900 900
----------- -----------
TOTAL ASSETS $ 8,667 $ 21,397
=========== ===========
LIABILITIES AND STOCKHOLDER'S DEFICIT
CURRENT LIABILITIES
Accounts payable $ 7,135 $ 11,998
Due to affiliate 172,346 168,578
----------- -----------
TOTAL LIABILITIES 179,481 180,576
----------- -----------
STOCKHOLDERS' DEFICIT
Common stock, $0.01 par value; 20,000,000
shares authorized; 512,500 shares issued
and outstanding in 2003 and 2002 5,125 5,125
Additional paid-in capital 25,775 25,775
Accumulated deficit (201,714) (190,079)
----------- -----------
TOTAL STOCKHOLDERS' DEFICIT (170,814) (159,179)
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 8,667 $ 21,397
=========== ==========
The accompanying notes are an integral part of these financial statements.
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FUNDRAISINGDIRECT.COM, INC.
STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 2003 AND 2002
2003 2002
---- ----
NET SALES $ 128,090 $ 139,032
COST OF SALES 69,567 96,230
-------- ---------
GROSS PROFIT 58,523 42,802
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 70,158 70,157
-------- ---------
NET LOSS $ (11,635) $ (27,355)
======== =========
The accompanying notes are an integral part of these financial statements.
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FUNDRAISINGDIRECT.COM, INC.
STATEMENTS OF STOCKHOLDERS' DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 2003 AND 2002
Additional
Common Paid-in Accumulated
Stock Capital Deficit Total
--------- ----------- ------------- ---------
BALANCE AT JANUARY 1, 2001 $ 5,125 $ 25,775 $ (162,724) $ (131,824)
Net loss for the year ended December 31, 2002 - - (27,355) (27,355)
--------- ----------- ------------- ----------
BALANCE AT DECEMBER 31, 2002 5,125 25,775 (190,079) (159,179)
Net loss for the year ended December 31, 2003 - - (11,635) (11,635)
--------- ----------- ------------- ----------
BALANCE AT DECEMBER 31, 2003 $ 5,125 $ 25,775 $ (201,714) $ (170,814)
========= =========== ============= ===========
The accompanying notes are an integral part of these financial statements.
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FUNDRAISINGDIRECT.COM, INC.
STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 2003 AND 2002
2003 2002
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CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (11,635) $ (27,355)
Adjustment to reconcile net income to net cash
used in operating activities
(Increase) decrease in assets
Accounts receivable 12,844 (13,331)
Increase (decrease) in liabilities
Accounts payable and accrued expenses (4,863) 3,976
-------- --------
Net cash used in operating activities (3,654) (36,710)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in amount due to affiliate 3,769 8,018
-------- --------
NET INCREASE (DECREASE) IN CASH 115 (28,692)
CASH - BEGINNING OF YEAR 461 29,153
-------- --------
CASH - END OF YEAR $ 576 $ 461
======== ========
The accompanying notes are an integral part of these financial statements.
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FUNDRAISINGDIRECT.COM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2003 AND 2002
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of the Business
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FundraisingDirect.com, Inc. (the "Company") was incorporated in 1999 under
the laws of the State of Delaware. The Company is engaged in the sales and
distribution of fundraising products to customers which are principally
nonprofit organizations.
Estimates
- ---------
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to
make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying disclosures. Although these estimates
are based on management's best knowledge of current events and actions the
company may undertake in the future, actual results could differ from the
estimates.
Concentration of Credit Risk
- ----------------------------
The Companies performs ongoing credit evaluations of its customers' financial
condition and, generally, requires no collateral from its customers.
Revenue Recognition
- -------------------
The Company recognizes net sales and the related cost of sales at the time
the products are shipped to customers.
Certain revenue is recorded on a net basis since the Company performs as an
agent without assuming the risks and rewards of ownership of the goods and
does not take title to the products.
The Company's product costs include amounts for shipping and handling,
therefore, it charges its customers shipping and handling fees at the time
the products are shipped or when its services are performed. The cost of
shipping products to the customer is included in selling, general and
administrative expenses. The costs of shipping and handling included in
selling, general and administrative expenses are approximately $10,500 and
$9,900 for the years ended December 31, 2003 and 2002.
Income Taxes
- ------------
The Company follows SFAS No. 109, "Accounting for Income Taxes" which
requires an asset and liability approach to financial accounting and
reporting for income taxes. Deferred income tax assets and liabilities are
computed annually for temporary differences between the financial statement
and tax bases of assets and liabilities that will result in taxable or
deductible amounts in the future based on enacted tax laws and rates
applicable to the periods in which the differences are expected to affect
taxable income. Valuation allowances are established when necessary to
reduce deferred tax assets to the amount expected to be realized.
Income tax expense is the tax payable or refundable for the period plus
or minus the change during the period in deferred tax assets and liabilities.
Comprehensive Income
- --------------------
The Company follows SFAS No. 130, "Reporting Comprehensive Income."
Comprehensive income is a more inclusive financial reporting methodology that
includes disclosure of certain financial information that historically has
not been recognized in the calculation of net income. Since the Company has
no items of other comprehensive income, comprehensive income (loss) is equal
to net income (loss).
Advertising Costs
- -----------------
The Company reports the costs of advertising as an expense when costs are
incurred.
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FUNDRAISINGDIRECT.COM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2003 AND 2002
NOTE 2 - COMMON STOCK
In January 2000, the Board of Directors voted to amend the Certificate of
Incorporation to change the name of the Company and to increase the amount of
authorized shares from 1,000 shares at no par value to 20,000,000 shares at
$0.01 par value. The Company mistakenly filed an Amended Certificate of
Incorporation reflecting the name change only. Subsequent to this
amendment, the Company issued 512,500 shares of its common stock valued at
$30,900. On October 29, 2004, the Company filed a Certificate of Correction
to correct the Amended Certificate of Incorporation to reflect the intended
increase in authorized shares and change in the par value. This change in
capital structure has been given retroactive treatment on the balance
sheets as of December 31, 2003 and 2002.
NOTE 3 - RELATED PARTY TRANSACTIONS
The Company purchases products from a company related by common ownership.
During the year ended December 31, 2003 and 2002, total purchases from related
entity were $61,711 and $68,134.
The Company shares certain operating expenses with this related entity.
The related entity pays these expenses and allocates to the Company its
proportionate share of the expenses. During the years ended December 31,
2003 and 2002, these expenses amounted to $53,490 and $62,929.
As of December 31, 2003 and 2002, the payable to this entity amounted to
$172,346 and $168,578. The payable is non-interest bearing with no specified
repayment terms.
NOTE 4 - INCOME TAXES
As of December 31, 2003 and 2002, the Company has net operating loss
carryforwards of approximately $200,000 and $190,000, expiring through the
year ending December 31, 2023. This amount can be used to offset future
taxable income of the Company.
The components of deferred tax assets as of December 31, 2003 and 2002 are
as follows:
2003 2002
------------ -----------
Deferred tax assets
Net operating loss carryforward $ 60,000 $ 57,000
Valuation allowance (60,000) (57,000)
----------- ----------
Total $ - $ -
=========== ==========
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FUNDRAISINGDIRECT.COM, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2003 AND 2002
NOTE 4 - INCOME TAXES (Continued)
The valuation allowance for deferred tax assets as of December 31, 2003 and
2002 was $60,000 and $57,000. The change in the total valuation for the
years ended December 31, 2003 and 2002 was an increase of $3,000 and $8,000.
In assessing the realization of deferred tax assets, management considers
whether it is more likely than not that some portion or all of the
deferred tax assets will not be realized. The ultimate realization of
deferred tax assets is dependant upon the generation of future taxable
income during the periods in which the net operating losses and temporary
differences become deductible. Management considered projected future
taxable income and tax planning strategies in making this assessment.
The value of the deferred tax assets was offset by a valuation allowance,
due to the current uncertainty of the future realization of the deferred
tax assets.
The timing and manner in which the Company can utilize operating loss
carryforwards in any year may be limited by provisions of the Internal
Revenue Code regarding changes in ownership of corporations. Such
limitation may have an impact on the ultimate realization of its
carryforwards and future tax deductions.
NOTE 5 - SUBSEQUENT EVENTS
On April 28, 2004, certain stockholders of the Company contributed $130,000
to the Company as additional paid-in capital. On April 29, 2004, these funds
were used as a partial payment of the amount due to affiliate.
On August 31, 2004, Mr. Justin DiNorscia and Mrs. Diane DiNorscia, holders
of 425,000 shares of the Company's total issued and outstanding shares,
exchanged their shares for 3,000,000 shares of BF Acquisition Group III,
Inc.'s Series A Preferred Stock. This transaction resulted in a change of
control of BF Acquisition Group III, Inc. ("BF Acquisition III") and was
accounted for as a reverse acquisition, whereby FundraisingDirect.com, Inc.
was deemed to have purchased BF Acquisition III.
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