UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549





FORM
10-Q





(Mark
One)





x
            QUARTERLY
      REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934.





For the
quarterly period ended December
31, 2009




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





For the
transition period from ____________ to ____________





Commission
File Number 000-51336





BEFUT INTERNATIONAL CO.,
LTD.


(Exact
name of registrant as specified in its charter)




Nevada
              20-2777600(State
      or other jurisdiction of
              (IRS
      Employerincorporation
      or organization)
              Identification
      No.)





No. 90-1 Hongji Street,
Xigang District Dalian City, Liaoning Province,


People’s
Republic of
China                 116011


(Address
of principal executive offices) (Zip Code)





+86-411-83678755


(Issuer's
telephone number, including area code)





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 x 
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 (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes  ̈ 
No  ̈





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
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check One):





Large
      accelerated
      filer                    
       ̈
                
                Accelerated
      filer                
       ̈Non-accelerated
      filer                 
       ̈
                  (Do
      not check if a smaller reporting company)
                
                Smaller
      reporting
      company                 
      x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes  ̈ No
x





APPLICABLE
ONLY TO CORPORATE ISSUERS:





Indicate
the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 29,512,317 shares of Common
Stock, $.001 par value, were outstanding as of February 8,
2010.








TABLE
OF CONTENTS





PagePART I
                                            FINANCIAL INFORMATIONItem 1.
                                            Financial Statements.
                                            3Report of Independent Registered Public Accounting Firm
                                            5Consolidated Balance SheetsAs of December 31, 2009 (Unaudited) and June 30, 2009
                                            6Consolidated Statements of Operations and Other Comprehensive IncomeFor
      the Three Months and Six Months Ended December 31, 2009 and 2008
      (Unaudited)
                                            7Consolidated Statements of Cash FlowsFor the Six Months Ended December 31, 2009 and 2008 (Unaudited)
                                            8Notes to Consolidated Financial StatementsDecember 31, 2009 and 2008 (Unaudited)
                                            9Item 2.
                                            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                                            17Item 4T.
                                            Controls and Procedures.
                                            29PART II
                                            OTHER INFORMATIONItem 6.
                                            Exhibits
                                            29Signatures
                                            
                                            30Exhibits/Certifications


2




PART
I - FINANCIAL INFORMATION





Item
      1.
            Financial
      Statements





BEFUT
INTERNATIONAL CO., LTD.
 
 CONSOLIDATED
FINANCIAL STATEMENTS
 
 DECEMBER
31, 2009 AND 2008
 
 (UNAUDITED)
  3
  BEFUT
INTERNATIONAL CO., LTD.
 Consolidated
Financial Statements
 December
31, 2009 And 2008
 (Unaudited)
 
 Table
of Contents
 
 PageCONSOLIDATED
      FINANCIAL STATEMENTSReport
      of Independent Registered Public Accounting Firm
                  
                  5Consolidated
      Balance Sheets
                  
                  6Consolidated
      Statements of Operations and Other Comprehensive Income
                  
                  7Consolidated
      Statements of Cash Flows
                  
                  8Notes
      to Consolidated Financial Statements
                  
                  9
  4
  Report
of Independent Registered Public Accounting Firm
 
 To the
Board of Directors and Stockholders
 BEFUT
International Co., Ltd.
 
 We have reviewed the accompanying
consolidated balance sheet of BEFUT International Co., Ltd. and subsidiaries
(collectively, the “Company”) as of December 31, 2009, and the related
consolidated statements of operations and comprehensive income for the three
months and six months ended December 31, 2009 and 2008, and cash flows for the
six months ended December 31, 2009 and 2008. These consolidated financial
statements are the responsibility of the Company's management.
 
 We conducted our reviews in accordance
with the standards of the Public Company Accounting Oversight Board (United
States). A review of interim financial information consists principally of
applying analytical procedures and making inquiries of persons responsible for
financial and accounting matters. It is substantially less in scope than an
audit conducted in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
 
 Based on our review, we are not aware
of any material modifications that should be made to the accompanying financial
statements referred to above for them to be in conformity with accounting
principles generally accepted in the United States of America.
 
 We have previously audited, in
accordance with auditing standards of the Public Company Accounting Oversight
Board (United States), the balance sheet of BEFUT International Co., Ltd. and
subsidiaries as of June 30, 2009, and the related consolidated statements of
operations and comprehensive income, stockholders’ equity, and cash flows for
the year then ended (not presented herein); and in our report dated September
24, 2009, we expressed an unqualified opinion on those financial statements. In
our opinion, the information set forth in the accompanying condensed balance
sheet as of June 30, 2009, is fairly stated, in all material respects, in
relation to the balance sheet from which it has been
derived.
 /s/
Patrizio & Zhao, LLC
 Parsippany,
New Jersey
 February
9, 2010
  5
  BEFUT
INTERNATIONAL CO., LTD.
  Consolidated
Balance Sheets
 December 31,
                            
                            
                            June 30,2009
                            
                            
                            2009(Unaudited)AssetsCurrent
      assets:Cash
      and cash equivalents
                            
                            $
                            5,385,893
                            
                            
                            $
                            210,301Restricted
      cash
                            
                            
                            -
                            
                            
                            
                            586,000Accounts
      receivable, net of allowance for doubtful accounts of
    $20,250and
      $20,222 at December 31, 2009 and June 30, 2009,
    respectively
                            
                            
                            8,625,800
                            
                            
                            
                            8,560,592Inventory
                            
                            
                            2,356,787
                            
                            
                            
                            1,353,532Loans
      to unrelated parties
                            
                            
                            5,442,954
                            
                            
                            
                            6,955,623Bank
      loan security deposits
                            
                            
                            898,178
                            
                            
                            
                            733,233Advance
      payments
                            
                            
                            9,080,518
                            
                            
                            
                            866,868Advance
      payments – R & D
                            
                            
                            2,960,406
                            
                            
                            
                            2,956,370Other
      current assets
                            
                            
                            1,398,992
                            
                            
                            
                            273,391Total
      current assets
                            
                            
                            36,149,528
                            
                            
                            
                            22,495,910Property
      and equipment, net
                            
                            
                            22,539,478
                            
                            
                            
                            18,646,274Other
      assets:Intangibles,
      net
                            
                            
                            10,808,821
                            
                            
                            
                            11,335,978Long-term
      investment
                            
                            
                            -
                            
                            
                            
                            2,930Total
      other assets
                            
                            
                            10,808,821
                            
                            
                            
                            11,338,908Total
      assets
                            
                            $
                            69,497,827
                            
                            
                            $
                            52,481,092LiabilitiesCurrent
      liabilities:Short-term
      bank loans
                            
                            $
                            5,281,200
                            
                            
                            $
                            8,057,500Convertible
      notes payable
                            
                            
                            500,000
                            
                            
                            
                            500,000Accounts
      payable and accrued expenses
                            
                            
                            2,289,829
                            
                            
                            
                            659,142Trade
      notes payable
                            
                            
                            -
                            
                            
                            
                            1,172,000Loans
      from unrelated party
                            
                            
                            2,524,572
                            
                            
                            
                            249,050Advances
      from customers
                            
                            
                            198,358
                            
                            
                            
                            372,417Income
      tax payable
                            
                            
                            1,364,522
                            
                            
                            
                            777,497Other
      taxes payable
                            
                            
                            -
                            
                            
                            
                            37,975Other
      current liabilities
                            
                            
                            871,945
                            
                            
                            
                            636,514Total
      current liabilities
                            
                            
                            13,030,426
                            
                            
                            
                            12,462,095Long-term
      bank loans
                            
                            
                            20,147,778
                            
                            
                            
                            5,470,310Total
      liabilities
                            
                            
                            33,178,204
                            
                            
                            
                            17,932,405EquityStockholders’
      equity:Preferred
      stock, $0.001 par value, 10,000,000 shares authorized,no
      shares issued or outstanding
                            
                            
                            -
                            
                            
                            
                            -Common
      stock, $0.001 par value, 200,000,000 shares authorized,29,511,277
      and 29,488,341 shares issued and outstanding atDecember
      31, 2009 and June 30, 2009, respectively
                            
                            
                            29,511
                            
                            
                            
                            29,488Additional
      paid-in capital
                            
                            
                            21,708,252
                            
                            
                            
                            21,708,275Statutory
      reserve
                            
                            
                            729,135
                            
                            
                            
                            729,135Retained
      earnings
                            
                            
                            11,434,502
                            
                            
                            
                            9,750,035Accumulated
      other comprehensive income
                            
                            
                            2,004,693
                            
                            
                            
                            1,956,623Total
      stockholders’ equity
                            
                            
                            35,906,093
                            
                            
                            
                            34,173,556`Noncontrolling
      interest
                            
                            
                            413,530
                            
                            
                            
                            375,131Total
      equity
                            
                            
                            36,319,623
                            
                            
                            
                            34,548,687Total
      liabilities and equity
                            
                            $
                            69,497,827
                            
                            
                            $
                            52,481,092
 
 The accompanying notes are an
integral part of these consolidated financial
statements.
  6
  BEFUT
INTERNATIONAL CO., LTD.
  Consolidated
Statements of Operations and Other Comprehensive Income
 (Unaudited)
 
 For the Three Months Ended
                      
                      
                      For the Six Months EndedDecember 31,
                      
                      
                      December 31,2009
                      
                      
                      2008
                      
                      
                      2009
                      
                      
                      2008Sales
                      
                      $
                      7,126,044
                      
                      
                      $
                      5,597,320
                      
                      
                      $
                      12,609,703
                      
                      
                      $
                      10,883,540Cost
      of sales
                      
                      
                      5,235,323
                      
                      
                      
                      4,297,581
                      
                      
                      
                      9,098,097
                      
                      
                      
                      8,261,547Gross
      profit
                      
                      
                      1,890,721
                      
                      
                      
                      1,299,739
                      
                      
                      
                      3,511,606
                      
                      
                      
                      2,621,993Operating
      expenses:Selling
      expenses
                      
                      
                      14,828
                      
                      
                      
                      136,265
                      
                      
                      
                      36,701
                      
                      
                      
                      166,616General
      and administrative expenses
                      
                      
                      442,264
                      
                      
                      
                      210,020
                      
                      
                      
                      1,030,549
                      
                      
                      
                      414,107Total
      operating expenses
                      
                      
                      457,092
                      
                      
                      
                      346,285
                      
                      
                      
                      1,067,250
                      
                      
                      
                      580,723Income
      from operations
                      
                      
                      1,433,629
                      
                      
                      
                      953,454
                      
                      
                      
                      2,444,356
                      
                      
                      
                      2,041,270Other
      income (expenses):Government
      subsidy income
                      
                      
                      304,704
                      
                      
                      
                      100,833
                      
                      
                      
                      354,658
                      
                      
                      
                      159,903Interest
      expense, net
                      
                      
                      (5,195
                      )
                      
                      
                      (122,030
                      )
                      
                      
                      (137,504
                      )
                      
                      
                      (280,162
                      )Other
      income (expenses)
                      
                      
                      (403,138
                      )
                      
                      
                      55,751
                      
                      
                      
                      (397,441
                      )
                      
                      
                      34,330Total
      other income (expenses)
                      
                      
                      (103,629
                      )
                      
                      
                      34,554
                      
                      
                      
                      (180,287
                      )
                      
                      
                      (85,929
                      )Income
      before provision for income tax
                      
                      
                      1,330,000
                      
                      
                      
                      988,008
                      
                      
                      
                      2,264,069
                      
                      
                      
                      1,955,341Provision
      for income tax
                      
                      
                      336,819
                      
                      
                      
                      29,684
                      
                      
                      
                      585,723
                      
                      
                      
                      102,407Net
      income before noncontrolling interest
                      
                      
                      993,181
                      
                      
                      
                      958,324
                      
                      
                      
                      1,678,346
                      
                      
                      
                      1,852,934Less:
      Noncontrolling interest
                      
                      
                      (963
                      )
                      
                      
                      (724
                      )
                      
                      
                      (6,121
                      )
                      
                      
                      (804
                      )Net
      income
                      
                      
                      994,144
                      
                      
                      
                      959,048
                      
                      
                      
                      1,684,467
                      
                      
                      
                      1,853,738Other
      comprehensive incomeForeign
      currency translation adjustment
                      
                      
                      263
                      
                      
                      
                      45,570
                      
                      
                      
                      48,070
                      
                      
                      
                      166,597Comprehensive
      income
                      
                      $
                      994,407
                      
                      
                      $
                      1,004,618
                      
                      
                      $
                      1,732,537
                      
                      
                      $
                      2,020,335Basic
      earnings per share
                      
                      $
                      0.03
                      
                      
                      $
                      0.03
                      
                      
                      $
                      0.06
                      
                      
                      $
                      0.06Diluted
      earnings per share
                      
                      $
                      0.03
                      
                      
                      $
                      0.03
                      
                      
                      $
                      0.06
                      
                      
                      $
                      0.06Weighted
      average number of common sharesoutstanding:Basic
                      
                      
                      29,511,277
                      
                      
                      
                      29,488,341
                      
                      
                      
                      29,511,277
                      
                      
                      
                      29,488,341Diluted
                      
                      
                      30,280,532
                      
                      
                      
                      29,488,341
                      
                      
                      
                      30,280,532
                      
                      
                      
                      29,488,341
 
 The
accompanying notes are an integral part of these consolidated financial
statements.
  7
  BEFUT
INTERNATIONAL CO., LTD.
 Consolidated
Statements of Cash Flows
 (Unaudited)
 
 For the Six Months EndedDecember 31,2009
                    
                    
                    2008Cash
      flows from operating activities:Net
      Income
                    
                    $
                    1,684,467
                    
                    
                    $
                    1,853,738Adjustments
      to reconcile net income to net cashused
      in operating activities:Depreciation
      and amortization
                    
                    
                    718,680
                    
                    
                    
                    129,455Noncontrolling
      interest
                    
                    
                    (6,121
                    )
                    
                    
                    (804
                    )Changes
      in current assets and current liabilities:Accounts
      receivable
                    
                    
                    (53,500
                    )
                    
                    
                    (932,103
                    )Inventory
                    
                    
                    (1,000,998
                    )
                    
                    
                    (612,574
                    )Advance
      payments
                    
                    
                    (197,666
                    )
                    
                    
                    71,727Other
      current assets
                    
                    
                    (1,032,681
                    )
                    
                    
                    (733,658
                    )Accounts
      payable and accrued expenses
                    
                    
                    1,637,214
                    
                    
                    
                    (715,933
                    )Trade
      notes payable
                    
                    
                    (1,173,120
                    )
                    
                    
                    1,171,440Advances
      from customers
                    
                    
                    (174,496
                    )
                    
                    
                    84,667Income
      tax payable
                    
                    
                    585,724
                    
                    
                    
                    -Other
      taxes payable
                    
                    
                    (163,417
                    )
                    
                    
                    45,978Other
      current liabilities
                    
                    
                    267,433
                    
                    
                    
                    131,509Total
      adjustments
                    
                    
                    (592,948
                    )
                    
                    
                    (1,360,296
                    )Net
      cash provided by operating activities
                    
                    
                    1,091,519
                    
                    
                    
                    493,442Cash
      flows from investing activities:Additions
      to property and equipment
                    
                    
                    (1,594,161
                    )
                    
                    
                    (59,188
                    )(Additions
      to) refund from construction in progress
                    
                    
                    (2,442,107
                    )
                    
                    
                    339,305Advance
      payment for fixed assets
                    
                    
                    (8,011,520
                    )
                    
                    
                    (2,608,359
                    )Acquisition
      of intangible assets
                    
                    
                    (6,452
                    )
                    
                    
                    -Long-term
      investment
                    
                    
                    2,933
                    
                    
                    
                    -Loans
      to unrelated parties
                    
                    
                    1,521,543
                    
                    
                    
                    (218,111
                    )Net
      cash used in investing activities
                    
                    
                    (10,529,764
                    )
                    
                    
                    (2,546,353
                    )Cash
      flows from financing activities:Loans
      from unrelated party
                    
                    
                    2,274,251
                    
                    
                    
                    -Bank
      loan security deposits
                    
                    
                    (163,877
                    )
                    
                    
                    (43,929
                    )Proceeds
      form minority shareholders
                    
                    
                    43,992
                    
                    
                    
                    -Proceeds
      (repayment) of short-term bank loans
                    
                    
                    (2,786,160
                    )
                    
                    
                    3,124,816Proceeds
      (repayment) of long-term bank loans
                    
                    
                    14,664,000
                    
                    
                    
                    -Net
      cash provided by financing activities
                    
                    
                    14,032,206
                    
                    
                    
                    3,080,887Effect
      of foreign currency translation on cash
                    
                    
                    (4,369
                    )
                    
                    
                    3,831Net
      increase in cash and cash equivalents and restricted cash
                    
                    
                    4,589,592
                    
                    
                    
                    1,031,807Cash
      and cash equivalents  and restricted cash –
      beginning
                    
                    
                    796,301
                    
                    
                    
                    353,049Cash
      and cash equivalents and restricted cash – ending
                    
                    $
                    5,385,893
                    
                    
                    $
                    1,384,856
  The accompanying notes are an
integral part of these consolidated financial
statements.
  8
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
1 – Organization and Nature of Business
 
 BEFUT
International Co., Ltd., formerly Frezer, Inc. (“Frezer”), a former public shell
company as defined
in Rule 12b-2 of theSecurities Exchange Act of
1934,was
established under
the laws of Nevada onMay 2, 2005. The accompanying
consolidated financial statements include the financial statements ofBEFUT International Co., Ltd.and its
subsidiaries (collectively,
the
“Company”). TheCompany’sprimary businessis to design and manufacture industrial wires and cables.
 
 On March
13, 2009, Frezer entered into and consummated a series of transactions whereby
(a) Frezer acquired 100% of the outstanding shares ofcommon stock
of Befut Corporation which was incorporated in the State of Nevada on January
14, 2009 (“Befut Nevada”), constituting all of the capitalstock of
Befut Nevada, from Befut International Co. Limited, a British Virgin Islands
company (“Befut BVI”) in exchange for the issuance to Befut BVIof a net
number of 117,768,300 shares of Frezer’s common stock and the cancellation of an
aggregate of 2,176,170 shares of the Frezer’s common stockand (b)
Frezer raised $500,000 in gross proceeds from the sale to four investors of
convertible promissory notes of Frezer in the principal amount of$500,000 and
warrants to purchase an aggregate of 720,076 shares of Frezer’s common stock.
The acquisition was accounted for as a reverse acquisitionunder the
purchase method for business combinations. On June 18, 2009, the Company
effectuated a name change from its original name “Frezer, Inc.”to “BEFUT
International Co., Ltd.”.
 
 Hong Kong
BEFUT Co., Ltd. (“Befut Hong Kong”) was incorporated on September 10, 2008 under
the laws of Hong Kong. It is 100% owned by BefutNevada. On
February 13, 2009, Befut Hong Kong invested 100% in Befut Electric (Dalian) Co.,
Ltd. (“WFOE”) in the city of Dalian, the People’sRepublic of
China (the “PRC”).
 
 On
February 16, 2009, WFOE entered into a series of agreements, the purpose of
which was to restructure Dalian Befut Wire & Cable ManufacturingCo., Ltd.
(“Dalian Befut”) in accordance with PRC law such that it could seek capital and
grow its business (the “Restructuring”). Dalian Befut wasincorporated
on June 13, 2002 under the laws of the PRC. The Restructuring includes the
following arrangements: First, WFOE entered into an OriginalManufacturer
Agreement (the “OEM Agreement”) with Dalian Befut with the following material
provisions: (i) Dalian Befut may not manufactureproducts for
any person or entity other than WFOE without its written consent; (ii) WFOE is
to provide all raw materials and advance related costs toDalian Befut,
as well as provide design requirements for products to be manufactured; (iii)
WFOE is responsible for marketing and distributing theproducts
manufactured by Dalian Befut and it keeps all related profits and revenues; and
(iv) WFOE has an exclusive right to purchase whole or part ofthe assets
and/or equity of Dalian Befut to the extent permitted by the PRC law at the sole
discretion of WFOE and at the mutually agreed price. Inaddition, on
February 16, 2009, WFOE entered into two ancillary agreements with Dalian Befut:
(i) Intellectual Property Rights License Agreement,pursuant to
which WFOE shall be permitted to use the intellectual property rights such as
trademarks, patents and know-how for the marketing and sale
 of the
products manufactured by Dalian Befut; and (ii) Non-competition Agreement,
pursuant to which Dalian Befut shall not compete against WFOE.
 
 On April
14, 2006, Dalian Marine Cable Co., Ltd. (“Dalian Marine Co.”) was incorporated
by Dalian Befut. Its current shareholders are Dalian Befut(having 86.6%
of the equity interest) and three individual shareholders. The three individuals
are also shareholders of Dalian Befut. Dalian Marine Co. isintended to
conduct marketing and production of marine cables for Dalian Befut.
 
 On July
1, 2009, Dalian Befut formed a joint venture Befut Zhong Xing Switch Co., Ltd.
with a third party individual. Dalian Befut owns 70% of theequity
interest in Befut Zhong Xing Switch Co., Ltd.
  9
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
2 – Summary of Significant Accounting Policies
 
 Basis
Of Presentation
 
 The Company’s consolidated financial
statements include the accounts of its direct wholly-owned subsidiaries and of
its indirect proportionate share ofsubsidiariesowned by the wholly-owned
subsidiaries. All intercompany balances and transactions are eliminated in
consolidation.The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles (“GAAP”) applicable to
interim financial information and the requirements of Form 10-Q and Rule 10-01
of Regulation S-X of the Securities and Exchange Commission. Accordingly, they
do not include all of the information and footnotes required by accounting
principles generally accepted in the United States of America for complete
financial statements. Interim results are not necessarily indicative of results
for a full year. In the opinion of management, all adjustments considered
necessary for a fair presentation of the financial position and the results of
operations and cash flows for the interim periods have been
included.
 
 Interim
Financial Statements
 
 These
interim financial statements should be read in conjunction with the audited
financial statements for the years ended June 30, 2009 and 2008, as not all
disclosures required by generally accepted accounting principles for annual
financial statements are presented. The interim financial statements follow the
same accounting policies and methods of computations as the audited financial
statements for the years ended June 30, 2009 and 2008.
 
 Recent
Accounting Pronouncements
 
 On July
1, 2009, the Financial Accounting Standards Board (“FASB”) officially launched
the FASB Accounting Standards Codification (“ASC”), which has
become the single official source of authoritativenongovernmental
U.S. GAAP, in addition to guidance issued by the Securities and Exchange
Commission. The ASC is designed to
simplify U.S. GAAP into a single, topically ordered structure. All guidance
contained in the ASC carries an
equal level of authority. The ASC is effective
for all interim and annual periods ending after September 15, 2009.The Company’s
implementation of this guidance effective July 1, 2009 did not have a material
effect on the Company’s condensed consolidated financial
statements.
 
 On July 1, 2009, the Company adopted
the accounting and disclosure requirements of Statement of Financial Accounting
Standard (“SFAS”) No.160,
Noncontrolling Interests in Consolidated Financial Statements, an Amendment of
ARB No. 51, which is now included with ASC Topic 810 Consolidation.  This
standard
establishes a single method of accounting for changes in a parent’s ownership
interest in a subsidiary that do not result in deconsolidation.  On a
prospective basis, any changes in ownership will be accounted for as equity
transactions with no gain or loss recognized on the transactions unless there is
a change in control.
 
 Note
3– Restricted Cash
 
 As ofDecember 31, 2009
and June 30, 2009, the Company
had$-0-and $586,000
restricted cash, respectively.These restricted
cashbalances
were reserved
for settlement of trade notes payable in
connection with inventorypurchases. As of December
31, 2009, the Company paid off the trade notes payable. The cash held in custody
by bank issuingthe trade notes
payable, is
restricted as to withdrawal or use, and is currently earning
interest.
  10
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
4 – Inventory
 
 Inventory
at December 31, 2009 and June 30, 2009 consists of the following:
 
 December 31,
                    
                    
                    June 30,2009
                    
                    
                    2009Raw
      materials
                    
                    $
                    1,426,328
                    
                    
                    $
                    400,343Work
      in process
                    
                    
                    60,786
                    
                    
                    
                    60,703Finished
      goods
                    
                    
                    869,673
                    
                    
                    
                    892,486Total
                    
                    $
                    2,356,787
                    
                    
                    $
                    1,353,532
 
 Note
5 – Loans to Unrelated Parties
 
 As ofDecember 31,
2009 and June 30, 2009, the Company had
outstandingloans to unrelated partiesof $5,442,954 and
$6,955,623,
respectively. These
loans representadvancestounrelated
partiesat an annual
interest rate of50% above the
applicable bank interest rate. Interest payments are
made semi-annually with no principal paymentsrequireduntil on or before
the due date, as per the terms of the loan agreement.
 
 Note
6 – Advance Payments
 
 As a
common practice in Chinese business environment, the Company is often required
to make advances to certain vendors for inventory, equipment, and construction
in progress. The balances outstanding for advances on purchase of inventory
amounted to $628,554 and $224,196 as of December 31, 2009 and June 30, 2009,
respectively. Additionally, the Company made advances on equipment purchases
amounting to $8,451,964 and $642,672 as of December 31, 2009 and June 30, 2009,
respectively.
 
 Note
7 – Advance Payments – Research and Development
 
 As a
common practice in Chinese business environment, the Company is required to make
advance payments for goods or services that will be used in future research and
development activities. The balance of outstanding advance payments for such
activities as of December 31, 2009 and June 30, 2009 was $2,908,518 and
$2,956,370, respectively.
 
 Note
8 – Property and Equipment
 
 Property
and equipment at December 31, 2009 and June 30, 2009 consists of the
following:
 
 December 31,
                    
                    
                    June 30,2009
                    
                    
                    2009Buildings
                    
                    $
                    1,025,047
                    
                    
                    $
                    1,019,457Machinery
      and equipment
                    
                    
                    3,119,043
                    
                    
                    
                    1,663,732Office
      equipment and furniture
                    
                    
                    80,004
                    
                    
                    
                    57,770Vehicles
                    
                    
                    387,832
                    
                    
                    
                    272,327Subtotal
                    
                    
                    4,611,926
                    
                    
                    
                    3,013,286Less:
      Accumulated depreciation
                    
                    
                    1,253,634
                    
                    
                    
                    1,082,2713,358,292
                    
                    
                    
                    1,931,015Add:
      Construction in progress
                    
                    
                    19,181,186
                    
                    
                    
                    16,715,259Total
                    
                    $
                    22,539,478
                    
                    
                    $
                    18,646,274
 
 Depreciation
expense for the three months ended December 31, 2009 and 2008 was $78,604 and
$65,068, respectively. Depreciation expense for the six months ended December
31, 2009 and 2008 was $169,816 and $127,925, respectively.
  11
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
9 – Intangible Assets
 
 Intangible
assets at December 31, 2009 and June 30, 2009 consist of the
following:
 
 December 31,
                    
                    
                    June 30,2009
                    
                    
                    2009Software
                    
                    $
                    22,526
                    
                    
                    $
                    16,049Well-known
      trademark
                    
                    
                    83,619
                    
                    
                    
                    83,505High-tech
      patent
                    
                    
                    11,554,158
                    
                    
                    
                    11,538,406Subtotal
                    
                    
                    11,660,303
                    
                    
                    
                    11,637,960Less:
      accumulated amortization
                    
                    
                    851,482
                    
                    
                    
                    301,982Total
                    
                    $
                    10,808,821
                    
                    
                    $
                    11,335,978
 
 Amortization
expense for the three months ended December 31, 2009 and 2008 was $288,022 and
$765, respectively. Amortization expense for the six months ended December 31,
2009 and 2008 was $548,864 and $1,530, respectively.
 
 Note
10 – Accounts Payable and Accrued Expenses
 
 Accounts
payable and accrued expenses at December 31, 2009 and June 30, 2009 consist of
the following:
 
 December 31,
                    
                    
                    June 30,2009
                    
                    
                    2009Accounts
      payable
                    
                    $
                    2,266,912
                    
                    
                    $
                    527,142Accrued
      expenses
                    
                    
                    22,917
                    
                    
                    
                    132,000Total
                    
                    $
                    2,289,829
                    
                    
                    $
                    659,142
 
 The
carrying value of accounts payable and accrued expenses approximates fair value
due to the short-term nature of these obligations.
 
 Note
11 – Short-Term Bank Loans
 
 Short-term
bank loans consist of the following:
 
 December 31,
                                        
                                        
                                        June 30,2009
                                        
                                        
                                        2009On
      July 31, 2008, the Company obtained a loan from Guangdong
      DevelopmentBank,
      of which the principal and interest were paid in full by July 30,
      2009.The
      interest was calculated using an annual fixed interest rate of 9.98%andpaid
      monthly. The loan was guaranteed by a third party. The guaranty
      wasreleased
      upon the full repayment of the loan.
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        586,000On
      August 27, 2008, the Company obtained a loan from Bank of Dalian,
      ofwhich
      the principal and interest were paid in full by August 27, 2009.
      Theinterest
      was calculated using an annual fixed interest rate of 10.458% and
      paidmonthly.
      The loan was secured by a lien on the Company’s property
    andequipment,
      inventory and guaranteed by a third party. Upon the
    repaymentin
      full of the loan, such lien and guaranty were released.
                                        
                                        $
                                        -
                                        
                                        
                                        $
                                        2,856,750
  12
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
11 – Short-Term Bank Loans (continued)
 
 December 31,
                                                          
                                                          
                                                          June 30,2009
                                                          
                                                          
                                                          2009On
      November 21, 2008, the Company obtained a loan from Agricultural
      Bankof
      China, of which the principal was paid in full by August 20, 2009. The
      interestwas
      calculated using an annual fixed interest rate of 10.0485% and
      paidmonthly.
      The loan was secured by a lien on the Company’s property
    andequipment
      and guaranteed by a third party. Upon the repayment in
fullof
      the loan, such lien and guaranty were released.
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          219,750On
      December 24, 2008, the Company obtained a loan from Shanghai
      PudongDevelopment
      Bank, of which the principal was paid in full by December
    24,2009.
      The interest was calculated using an annual fixed interest rate of
      6.138%and
      paid quarterly. The loan was guaranteed by a third party. The guaranty
      wasreleased
      upon the full repayment of the loan.
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          1,465,000On
      May 6, 2009, the Company obtained a loan from China Merchants
      Bank,of
      which the principal was paid in full by October 30, 2009. The interest
      wascalculated
      using an annual fixed interest rate of 5.841% and paid
      monthly.The
      loan was secured by a lien on the Company’s property and
      equipment.The
      lien was released upon the full repayment of the loan.
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          2,930,000On
      September 16, 2009, the Company obtained a loan from Harbin
      Bank,of
      which the principal is to be paid in full by September 15, 2010. The
      interestis
      calculated using an annual fixed interest rate of 6.372% and paid
      monthly.The
      loan is secured by a lien on the Company’s property and
      equipment.
                                                          
                                                          $
                                                          2,934,000
                                                          
                                                          
                                                          $
                                                          -On
      October 30, 2009, the Company obtained a loan from Bank of
      Dalian,of
      which the principal is to be paid in full by October 29, 2010. The
      interestis
      calculated using an annual fixed interest rate of 6.903% and paid
      monthly.The
      loan is guaranteed by a third party.
                                                          
                                                          $
                                                          2,347,200
                                                          
                                                          
                                                          $
                                                          -Total
                                                          
                                                          $
                                                          5,281,200
                                                          
                                                          
                                                          $
                                                          8,057,500
 
 Note
12 – Long-Term Bank Loans
 
 In
November 2006, the Company obtained a loan from Construction Bank of China for
the purchase of property. As per the terms of the loan agreement, the loan will
mature in November 2011. The interest rate is to be adjusted every twelve
months. As ofDecember 31, 2009 and June 30, 2009, theoutstanding
loanbalance
was$5,477,778 and $5,470,310,
respectively. The annual interest ratefor the first and the second yearwasfixed at
8.6879% and 7.50312%, respectively.
The current interest rate is 6.947%.
 
 On
November 2, 2009, Dalian Befut entered into a Loan Agreement (the “Loan
Agreement”) with the PRC National Development Bank Joint Equity Corporation
(“NDB”) pursuant to which Dalian Befut borrowed RMB100,000,000 (approximately
$14,670,000) from NDB (the “Loan”). Dalian Befut received the first tranche of
the proceeds from the Loan at the amount of RMB70,000,000 (approximately
$10,269,000) on November 9, 2009 and the second tranche of the proceeds from the
Loan at the amount of RMB30,000,000 (approximately $4,401,000) on December 28,
2009. The term of the Loan is seven years, maturing on November 1, 2016. The
interest rate will be a variable rate equal to 5% per annum above the floating
base interest for loans of the same term promulgated by the PRC’s central bank,
China People’s Bank. The Loan was designated to finance the construction of
Dalian Befut’s planned specialty cable production lines with a production
capacity of 15,000 tons. The Loan was secured by, among other liens, a first
priority lien on the Dalian Befut’s land use right and its building property
ownership and guaranteed by, among other guarantees, Mr. Cao, and Mr. Li, Dalian
Befut’s two major shareholders.
  13
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
13 – Earnings Per Share
 
 The
Company presents earnings per share on a basic and diluted basis. Basic earnings
per share are computed by dividing income available to common shareholders by
the weighted average number of common shares outstanding. Diluted earnings per
share are computed by dividing income available to common shareholders by the
weighted average number of shares outstanding plus the dilutive effect of
potential securities. All shares and per share data have been adjusted
retroactively to reflect the recapitalization of
the Company pursuant to the Securities Exchange Agreement withBefut
Nevada.On
June 18, 2009, the Company effectuated a 1 for 4.07 reverse stock split of the
Company’s common stock, and previously reported shares and earnings per share
amounts have been recalculated accordingly.
 
 For the Three MonthsEndedDecember 31,2009
                          
                          
                          2008Net
      income
                          
                          $
                          994,144
                          
                          
                          $
                          959,048Weighted
      average common shares(denominator
      for basic earnings per share)
                          
                          
                          29,511,277
                          
                          
                          
                          29,488,341Effect
      of dilutive securities:Convertible
      notes
                          
                          
                          769,255
                          
                          
                          
                          -Weighted
      average common shares(denominator
      for diluted earnings per share)
                          
                          
                          30,280,532
                          
                          
                          
                          29,488,341Basic
      earnings per share
                          
                          $
                          0.03
                          
                          
                          $
                          0.03Diluted
      earnings per share
                          
                          $
                          0.03
                          
                          
                          $
                          0.03
 
 For the Six MonthsEndedDecember 31,2009
                          
                          
                          2008Net
      income
                          
                          $
                          1,684,467
                          
                          
                          $
                          1,853,738Weighted
      average common shares(denominator
      for basic earnings per share)
                          
                          
                          29,511,277
                          
                          
                          
                          29,488,341Effect
      of dilutive securities:Convertible
      notes
                          
                          
                          769,255
                          
                          
                          
                          -Weighted
      average common shares(denominator
      for diluted earnings per share)
                          
                          
                          30,280,532
                          
                          
                          
                          29,488,341Basic
      earnings per share
                          
                          $
                          0.06
                          
                          
                          $
                          0.06Diluted
      earnings per share
                          
                          $
                          0.06
                          
                          
                          $
                          0.06
  14
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
14 – Stockholders’ Equity And Related Financing Agreements
 
 On March
13, 2009, as part of the reverse merger transaction, Frezer acquired, from Befut
BVI, 100% of the outstanding shares of common stock of Befut Nevada. In
exchange, Befut BVI was issued 117,768,300 shares of Frezer’s Common Stock,
under a Share Exchange Agreement (“SEA”) pursuant to a claim of exemption under
Section 4(2) of the Securities Act of 1933, as amended, for issuances not
involving a public offering. As a result of the transaction, Befut Nevada became
a wholly-owned subsidiary of Frezer.
 
 On March
13, 2009, the Company completed a private financing totaling $500,000, for which
convertible promissory notes were issued, with four accredited investors (the
“March 2009 Financing”). Consummation of the financing was a condition to the
completion of the share exchange transaction with Befut BVI and the Befut BVI
Stockholders under the Share Exchange Agreement. The securities offered in the
financing were sold pursuant to a Securities Purchase Agreement (the “Purchase
Agreement”) by and among Frezer and the investors named in the Purchase
Agreement (collectively, the “Investors”).
 
 In
accordance with the Purchase Agreement, the Company issued a total securities
consisting of: (i) 3,130,869 shares of Frezer’s common stock $0.001 par value
per share in connection with the private financing; (ii) Five (5) year warrants
to purchase 720,076 shares of Frezer common stock at an initial exercise price
of $0.1916 per share.
 
 On June
18, 2009, the Company effectuated a 1 for 4.07 reverse stock split of its
outstanding common stock (the “Reverse Split”). The Reverse Split did not alter
the number of shares of the common stock the Company is authorized to issue, but
rather simply reduced the number of shares of its common stock issued and
outstanding. Any fractional shares issued as a result of the Reserve Split were
rounded up. In addition, any shareholder owning at least 100 shares but less
than 407 shares of the Company’s common stock on June 17, 2009, would own at
least 100 shares after giving effect to the Reverse Split.
 
 Note
15 – Income Taxes
 
 The
Company is a Nevada corporation and conducts all of its business through its
Chinese subsidiary and its affiliated Chinese operating companies. All business
is conducted in PRC. As the U.S. holding company has not recorded any income for
the six months ended December 31, 2009 and 2008, there was no provision or
benefit for U.S. income tax purpose.
 
 The
Company’s Chinese subsidiary and affiliated operating companies based in China
are governed by the Income Tax Law of the PRC concerning the private-run
enterprises, which are generally subject to tax at a new statutory rate of 25%
and were, until January 2008, subject to tax at a statutory rate of 33% (30%
state income tax plus 3% local income tax) on income reported in the statutory
statements after appropriate tax adjustments.
 
 On March
16, 2007, the National People’s Congress of China approved the Corporate Income
Tax Law of the PRC (the New CIT Law), which is effective from January 1, 2008.
Under the new law, the corporate income tax rate applicable to all Companies,
both domestic and foreign-invested companies, is 25%, replacing the previous
applicable tax rate of 33%. For the six months ended December 31, 2009, the
income tax provision by the Company was $585,723.
 
 Note
16 – Employee
Welfare Plan
 
 The
Company has established an employee welfare plan in accordance with Chinese laws
and regulations. Full-time employees of the Company in the PRC
participate in a government-mandated multi-employer defined contribution plan
pursuant to which certain pension benefits, medical care, unemployment
insuranceand other
welfare benefits are provided to employees. PRC labor regulations require the
Company to
accrue for these benefits based on a certain percentage of the employees’
salaries.
  15
  BEFUT
INTERNATIONAL CO., LTD.
 
 Notes
to Consolidated Financial Statements
 December
31, 2009 and 2008
 (Unaudited)
 
 Note
17 – Risk Factors
 
 For the
six months ended December 31, 2009 and 2008, two vendors accounted for
approximately 56.19% and 60.35% of the Company’s raw materials, respectively.
Purchases from these vendors were $6,524,876 and $6,672,275 for the six months
ended December 31, 2009 and 2008, respectively.
 
 For the
six months ended December 31, 2009, five customers accounted for approximately
44.01% of the Company’s total sales. Sales to these customers amounted to
$5,550,159. For the six months ended December 31, 2008, three customers
accounted for approximately 44.80% of the Company’s total sales. Sales to these
customers amounted to $4,876,163.
 
 The
Company's operations are carried out in the PRC. Accordingly, the Company's
business, financial condition and results of operations may be influenced by the
political, economic and legal environments in the PRC as well as by the general
state of the PRC’s economy. The Company's business may also be influenced by
changes in governmental policies with respect to laws and regulations,
anti-inflationary measures, currency conversion and remittance abroad, and rates
and methods of taxation, among other things.
 
 Note
18 – Concentrations of Credit Risk
 
 Financial
instruments which potentially subject the Company to credit risk consist
principally of cash on deposit with financial institutions. Management believes
that the financial institutions that hold the Company’s cash and cash
equivalents are financially sound and minimal credit risk exists with respect to
these investments.
 
 Note
19 – Supplemental Cash Flow Disclosures
 
 The
following is supplemental information relating to the consolidated statements of
cash flows:
 
 Six MonthsEnded December 31,2009
                    
                    
                    2008Cash
      paid for interest
                    
                    $
                    137,504
                    
                    
                    $
                    280,162Cash
      paid for income taxes
                    
                    $
                    -
                    
                    
                    $
                    102,407
 
 Note
20 – Subsequent Events
 
 In
January 2010, Dalian Befut contributed approximately $2,000,000 additional
capital to Befut Zhong Xing, a joint venture with a third party individual, and
obtained a total of 73.5% interest in the joint venture after the increased
capital contribution. The initial contribution was made in July 2009 when Dalian
Befut obtained 70% interest in the joint venture.
  16




Item
      2.
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations




The
following discussion of our financial condition and results of operations should
be read in conjunction with our consolidated financial statements and the notes
to those financial statements appearing elsewhere in this report.
 
 Certain
statements in this report constitute “forward-looking statements”. Such
forward-looking statements include statements, which involve risks and
uncertainties, regarding, among other things, (a) our projected sales,
profitability, and cash flows, (b) our growth strategies, (c) anticipated
trends in our industries, (d) our future financing plans, and (e) our
anticipated needs for, and use of, working capital. They are
generally identifiable by use of the words “may,” “will,” “should,”
“anticipate,” “estimate,” “plan,” “potential,” “project,” “continuing,”
“ongoing,” “expects,” “management believes,” “we believe,” “we intend,” or the
negative of these words or other variations on these words or comparable
terminology. Actual events or results may differ materially from those discussed
in forward-looking statements as a result of various factors, including, without
limitation, the risks and matters described in this report generally. In light
of these risks and uncertainties, there can be no assurance that the
forward-looking statements contained in this filing will in fact occur. You
should not place undue reliance on these forward-looking
statements.
 
 The
forward-looking statements speak only as of the date on which they are made,
and, except to the extent required by federal securities laws, we undertake no
obligation to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to reflect the
occurrence of unanticipated events.
 
 Unless
the context indicates otherwise, as used in the following discussion, the words
“Company”, “we,” “us,” and “our,” each refer to (i) Befut International Co.,
Ltd. (f/k/a Frezer, Inc.) (the “Public Company”), a corporation incorporated in
the State of Nevada; (ii) BEFUT Corporation, a corporation incorporated in the
State of Nevada (“Befut Nevada”); (ii) Hongkong BEFUT Co., Ltd. (“Befut
Hongkong”), a wholly-owned subsidiary of Befut Nevada incorporated under the
laws of Hong Kong; (iii) Befut Electric (Dalian) Co., Ltd. (“WFOE”), a
corporation organized under the laws of the People’s Republic of China (the
“PRC”), a wholly-owned subsidiary of Befut Hongkong; (vi) Dalian Befut Wire and
Cable Manufacturing Co., Ltd. (“Dalian Befut”), a corporation incorporated under
the laws of the PRC, which is controlled by Dalian Befut through a series of
agreements; (vii) Dalian Marine Cable Co., Ltd., a corporation that is 86.6%
owned by Dalian Befut. (“Befut Marine”) and (viii) Dalian Befut Zhong Xing
Switch Co., Ltd., a corporation that is 70% owned by Dalian Befut (“Befut
Zhong Xing”).
 
 Unless
the context otherwise requires, all references to (i)  “PRC” and
“China” are to the People’s Republic of China or mainland China; (ii) “U.S.
dollar,” “$” and “US$” are to United States dollars; and (iii) “RMB”, “Yuan” and
Renminbi are to the currency of PRC or China.
  17
  Overview
 
 We
believe we are one of the largest developers, manufacturers and distributors of
cable and wire in northeastern China. We are engaged in the production of
traditional cables, including metallurgy, electric power system cables, and
specialty cables, including marine cable, mine specialty cable, nuclear cable,
and petrochemical cable. We also have the technical capability for the
production of large-scale submarine cable, a segment with significantly higher
profit margins, and locomotive cable, a segment with both large profit margins
and high demand.
 
 On July
1, 2009, Dalian Befut formed Befut Zhong Xing by investing approximately
$100,000 (RMB 700,000) for a 70% equity interest in the new entity. Befut Zhong
Xing is engaged in production of electric switches and switch boxes. We are
seeing strong demand from many of our existing cable and wire customers for
electric switches. Befut Zhong Xing utilizes advanced technology and
employs a number of China’s experts in the electrical switch field. In
January 2010, we invested approximately an additional $2,000,000 (RMB
14,000,000) into Befut Zhong Xing and now own 73.5% of its equity. We anticipate
that Befut Zhong Xing may generate approximately 10% to 15% of our total revenue
in 2010.
 
 We
believe our location provides our business with geographic advantages. Our
headquarters and major facilities of business are located in the area of Dalian,
the most important industry and business center in Northeastern China.
Northeastern China is an optimal region for developing mining and oil industries
due to its rich mineral reserves. Dalian is an ice-free port and a historic
capital shipyard in China and, therefore, is an ideal place for development of
our marine cables.
 
 Currently
the Hongyan River Nuclear Power Station, a $6 billion project, is under
construction near Dalian as part of China’s recent nuclear power development
initiative. Dalian Befut provided approximately $600,000 of cable and wire
products to the Hongyan River Nuclear Power Station in 2009. Dalian Befut is the
only provider of low-voltage products among the existing three suppliers of the
project. Among the nine domestic cable and wire suppliers eligible for providing
products to nuclear stations in China today, we are the only one located in
Northeastern China.
 
 We have
been repositioning our Company from being a traditional cable manufacturer to a
specialty cable supplier. Specialty cable typically has much higher
gross margins, ranging from 25% to 45%, while traditional cable has a
gross profit margin below 15%.
 
 Copper is
our primary raw material. The pricing volatility of copper, a primary cause of
cost variations in our products, does not materially affect our dollar earnings.
Following the industry common practice, we generally pass the cost of price
changes in our raw materials to our customers. As a result, the impact on
earnings per share from volatile raw material prices is minimal.
  We are
creating shareholder value by:
  ·
              Focusing
      on new, higher-margin products, applications and
  markets;
 ·
              Investing
      in infrastructure to expand our manufacturing capacity and strengthening
      our research and development to deliver high quality, high end
      products;
  18
  ·
              Improving
      business processes throughout the Company by focusing on key performance
      indicators and operational excellence to keep pace with our high rate of
      growth;
 ·
              Strategically
      hiring personnel with a wide range of talents to improve the effectiveness
      of our management processes;
 ·
              Protecting
      and enhancing our Sanyuan brand;
and
 ·
              Clearly
      communicating with investors in public and private
  markets.
  We also
seek opportunities for acquisitions that can expand the overall growth and scope
of our business more rapidly.
  Highlights
for the quarter ended December 31, 2009 include:
  ·
              Basic
      EPS of $0.03 for the three months ended December 31,
  2009.
 ·
              Gross
      margin increased 331 basis points, from 23.2% of revenue to 26.5% of
      revenue as compared with the same period in
  2008.
 ·
              Generated
      approximately $1.38 million in cash from our main business operating
      activities.
 ·
              Successfully
      obtained a long-term bank loan of $14.6 million for our future business
      growth.
  Current
Business Environment and Economic Outlook
 
 Management
is encouraged by recent positive trends indicating that the global economy
is steadily recovering, especially in China. China’s GDP growth for the
quarter ended December 31, 2009 was 10.7%, according to the National Bureau
of Statistics of China. We have seen significant improvement in industries
relating to our business, such as mining, energy, infrastructure, transportation
and telecommunication. We believe that the following trends will provide us with
opportunities to attract new business and increase profitability:
 
 ·
              A
      Chinese government stimulus package focusing on infrastructure,
      transportation, telecommunication and power grid
  building;
 ·
              Continued
      large demand for energy worldwide, especially in China, in the coal, oil
      and gas, and new energy sectors;
 ·
              A
      Chinese government initiative to rapidly build nuclear power stations
      nationwide;
 ·
              The
      global economic recovery, which stimulates the need for transportation and
      positively impacts the shipyard and automotive
  industries.
 
 Recent
Developments
 
 During
the quarter ended December 31, 2009, we received an aggregate of approximately
$14.64 million from the PRC National Development Bank Joint Equity Corporation.
$8,451,964 of the net proceeds was used to purchase new production lines. The
balance will be used either to pay construction costs relating to our Changxing
Island facility or for working capital.
  19
  In
November 2009, we completed the first phase of the construction of a
manufacturing plant in the industrial zone on Changxing Island (“Changxing
Island Phase I Construction”), which includes 45,000 square meters of
construction space on a 65,000 square meters parcel of land. We began to move
our workers and equipment into the new facilities during the quarter ended
December 31, 2009, and have commenced operations there. We expect our production
capacity could be increased from $30 million per year to $200 million per year
in three years. We have obtained land use rights to a land of 85,000 square
meters of property for the second phase of construction (“Changxing Island Phase
II Construction”). We plan to commence our Changxing Island Project Phase II
Construction when our Changxing Island Project Phase I Construction reaches full
capacity in approximately three years or when we identify an appropriate
strategic partner, whichever comes earlier. The main purpose of Phase II
Construction is to expand our production capacity for specialty cable by
introducing strategic alliances and integrating technology and industrial
resources in order to make Dalian Befut the most competitive specialty cable
producer in China and to compete in the international cable market. After the
completion of both phases, we expect the Changxing Island plant to occupy
150,000 square meters total, with 87,000 square meters of building
construction.
 
 Results
of Operations
 
 Three
months and six months ended December 31, 2009 compared to the three months and
six months ended December 31, 2008.
 
 All numbers in thousands
                  
                  Three months ended by
                  
                  
                  Change in
                  
                  
                  Six months ended by
                  
                  
                  Change inExcept % numbers
                  
                  Dec. 31,09
                  
                  
                  Dec. 31, 08
                  
                  
                  %
                  
                  
                  Dec. 31, 09
                  
                  
                  Dec. 31, 08
                  
                  
                  %Sales
                  
                  $
                  7,126
                  
                  
                  $
                  5,597
                  
                  
                  
                  27
                  
                  
                  $
                  12,610
                  
                  
                  $
                  10,884
                  
                  
                  
                  16Cost
      of sales
                  
                  $
                  5,235
                  
                  
                  $
                  4,298
                  
                  
                  
                  21
                  
                  
                  $
                  9,098
                  
                  
                  $
                  8,262
                  
                  
                  
                  10Gross
      profit
                  
                  $
                  1,891
                  
                  
                  $
                  1,300
                  
                  
                  
                  46
                  
                  
                  $
                  3,512
                  
                  
                  $
                  2,622
                  
                  
                  
                  34Total
      operating expenses
                  
                  $
                  457
                  
                  
                  $
                  346
                  
                  
                  
                  32
                  
                  
                  $
                  1,067
                  
                  
                  $
                  581
                  
                  
                  
                  84Total
      Other income/(expenses)
                  
                  $
                  (104
                  )
                  
                  $
                  35
                  
                  
                  
                  (403
                  )
                  
                  $
                  (180
                  )
                  
                  $
                  (86
                  )
                  
                  
                  (110
                  )Net
      income
                  
                  $
                  994
                  
                  
                  $
                  959
                  
                  
                  
                  4
                  
                  
                  $
                  1,684
                  
                  
                  $
                  1,853
                  
                  
                  
                  (9
                  )
 
 THREE
MONTHS ENDED DECEMBER 31, 2009 COMPARED WITH THREE MONTHS ENDED DECEMBER 31,
2008
 
 Sales
 
 Our sales
for the three months ended December 31, 2009 were $7,126,044, an increase
of $1,528,724, or 27.3%, as compared to the three months ended December 31,
2008. The increase was primarily due to increased customer demand,
especially in the mining, oil and gas and shipyard industries, as the Chinese
economic environment steadily recovers.
 
 For the
three months ended December 31, 2009, our sales of specialty cable
including mining cable, marine cable and oil and gas cable, as a percentage of
total sales increased significantly to 63% from 33% in the three months
ended December 31, 2008. We continue to pursue our strategy of focusing on
manufacturing higher-gross margin specialty cable over traditional
cable.
  20
 
 Cost of
Sales
 
 Cost of
sales is primarily comprised of the cost of raw materials used in the production
of our cable products, direct labor and manufacturing overhead expenses. Our
cost of sales for the three months ended December 31, 2009 was $5,235,323, an
increase of $937,742, or 21.8%, as compared to the three months ended December
31, 2008. The percentage of our increase in cost of sales, 21.8%, was much lower
than that of the increase in sales, 27.3% because we were able to reduce the
cost by producing higher-gross margin specialty cable products.
 
 Gross
Profit
 
 Gross
profit for the three months ended December 31, 2009 was $1,890,721, an
increase of $590,982, or 45.5%, as compared to the three months ended December
31, 2008. Gross profit as a percentage of sales was 26.5% for the three months
ended December 31, 2009, as compared to 23.2% for the three months ended
December 31, 2008. This was due to the shift in our product mix toward higher
sales of specialty cable products such as marine cables and mining cables, which
have gross profit margins ranging from 25% to 45%.
 
 Selling,
General and Administrative Expenses
 
 Our
selling, general and administrative expenses consist primarily of salaries and
bonuses for sales personnel, advertising and promotion expenses, freight
charges, related compensation and professional fees, and amortization expenses.
Selling expenses were $14,828 in the three months ended December 31, 2009, as
compared to $136,265 in the three months ended December 31, 2008, a decrease of
$121,437, or 89.1%. The decrease was primarily attributable to our less spending
on advertising and promotion of our products based on our assessment of the
market condition. General and administrative expenses were $442,264 for the
three months ended December 31, 2009, an increase of $232,244, or 110.6%, as
compared to the three months ended December 31, 2008. Such increase was
primarily due to the amortization expense of $288,022 related to intangible
assets we acquired in the third and fourth quarters of fiscal 2009.
  Income from
Operations
 
 Our
operating income was $1,433,629 for the three months ended December 31,
2009, an increase of $480,175, or 50.0% as compared to $953,454 for the
three months ended December 31, 2008. This increase was primarily a result
of the significant increase in gross profit of our main business, partially
offset by an increase in general and administrative expenses related to the
amortization of the intangible assets acquired in the third and fourth quarters
of fiscal 2009.
 
 Government
Subsidy
 
 In the
three months ended December 31, 2009 we received a subsidy in the amount of
$304,704 as compared to a subsidy of $100,833 in the three months ended December
31, 2008. The subsidy is a reward for our “Sanyuan” brand’s selection
as a China “Famous Brand”. Our status as a China Famous Brand was determined
through a formal process either by the Industrial and Commercial Bureau or by
Jurisdiction and based on several factors including the scope, length and
records of brand usage.
  21
 
 This
subsidy is determined by the local government on a yearly basis and no
assurances can be given that we will continue to receive the
subsidy.
 
 Interest
Expenses
 
 Interest
expense was $5,195 for the three months ended December 31, 2009, a decrease
of $116,835, or  95.7%, as compared to $122,030 for the three
months ended December 31, 2008, primarily due to the refinancing of debt from
short-term to long-term at a lower initial interest rate.
 
 Other
expense
 
 Other
expenses were $403,138 for the three months ended December 31, 2009, an
increase of $458,889, or 82.3% as compared to other income of $55,751
for the three months ended December 31, 2008, which is primarily attributable to
increasing borrowing expense.
 
 Income
Taxes
 
 Our
business operations were conducted solely by our subsidiaries incorporated in
the PRC and we were governed by the PRC Enterprise Income Tax Laws. China
enterprise income tax is calculated based on taxable income determined under
Chinese GAAP. In accordance with the PRC Income Tax Laws, a Chinese domestic
company is subject to taxes, including but not limited to: (i) enterprise income
tax rate of 25% effective from January 1, 2008; and (ii) value added tax at the
rate of 17% for most of the goods sold.
 
 Provision
for income taxes was $336,819 for the three months ended December 31, 2009,
an increase of $307,135, or 1034%, compared to $29,684 for the three
months ended December 31, 2008. This increase was primarily due to the fact
that Dalian Befut was subject to a full 25% income tax rate in the three months
ended December 31, 2009 while it paid a lower percentage of income tax in the
corresponding period ended December 31, 2008.
 
 Net
Income
 
 Net
income for the three months ended December 31, 2009 was $994,144, an increase of
$35,096, or 3.6%, as compared to net income of $959,048 for the three
months ended December 31, 2008. The increase was mainly attributable to a
$590,982 increase in gross profit, which was partially offset by an increase in
general and administrative expenses of $232,244 and an increase in provision for
income taxes of $307,135.
  22
  SIX
MONTHS ENDED DECEMBER 31, 2009 COMPARED WITH SIX MONTHS ENDED DECEMBER 31,
2008
 
 Sales
 
 Our sales
for the six months ended December 31, 2009 were $12,609,703, an increase of
$1,726,163, or 15.9%, as compared to the six months ended December 31, 2008. The
increase was primarily due to stronger customer demand, especially in mining,
oil and gas and shipyard industries, as the China economic environment steadily
recovers.
 
 For the
six months ended December 31, 2009, our sales of specialty cable including
mining cable, marine cable and oil and gas cable, as a percentage of total sales
increased significantly to 62%, up from 36% in the six months ended December 31,
2008. We continue to pursue our strategy to manufacture more high-margin
specialty cables than traditional cables.
 
 Cost of
Sales
 
 Cost of
sales is primarily comprised of the cost of raw materials used in the production
of our cable products, direct labor and manufacturing overhead expenses. Our
cost of sales for the six months ended December 31, 2009 was $9,098,097, an
increase of $836,550, or 10.1%, as compared to the six months ended December 31,
2008. The percentage of our increase in cost of sales, 10.1%, was lower than
that of the increase in sales, 15.9%. We were able to reduce the cost by
producing higher-gross margin specialty cable products.
 
 Gross
Profit
 
 Gross
profit for the six months ended December 31, 2009 was $3,511,606, an increase of
$889,613, or 33.9%, as compared to the six months ended December 31, 2008. Gross
profit as a percentage of sales was 27.8% for the six months ended December 31,
2009, as compared to 24.0% for the six months ended December 31, 2008. This was
due to the shift in our product mix toward higher sales of specialty cable
products such as marine cables and mining cables, which have gross profit
margins ranging from 25% to 45%.
 
 Selling,
General and Administrative Expenses
 
 Our
selling, general and administrative expenses consist primarily of salaries and
bonuses for sales personnel, advertising and promotion expenses, freight
charges, related compensation and professional fees, and amortization expenses.
Selling expenses were $36,701 in the six months ended December 31, 2009 as
compared to $166,616 in the six months ended December 31, 2008, a decrease of
$129,915, or 77.9%. The decrease was primarily attributable to our less spending
on advertising and promotion of our products based on our assessment of the
market condition. General and administrative expenses were $1,030,549 for the
six months ended December 31, 2009, an increase of $616,442, or 148.8%, as
compared to the six months ended December 31, 2008. This increase was primarily
due to the amortization expense of $548,864 related to intangible assets we
acquired in the third and fourth quarters of fiscal 2009.
  23
  Income
from Operations
 
 Our
operating income was $2,444,356 for the six months ended December 31, 2009, an
increase of $403,086, or 19.7% as compared to $2,041,270 for the six months
ended December 31, 2008, primarily a result of the significant increase in gross
profit of our main business, partially offset by an increase in general and
administrative expenses related to the amortization of the intangible assets
acquired in the third and fourth quarters of fiscal 2009.
 
 Government
Subsidy
 
 In the
six months ended December 31, 2009 we received a subsidy in the amount of
$354,658 as compared to a subsidy of $159,903 in the six months ended December
31, 2008. The majority of the subsidy was in recognition of our brand “Sanyuan”
as a China “Famous Brand”. Our status as a China Famous Brand was determined
through a formal process [either by the Industrial and Commercial Bureau or by
Jurisdiction] based on several factors, including scope, length and records of
brand usage.
 
 This
subsidy is determined by the local government on a yearly basis and no
assurances can be given that we will continue to receive the
subsidy.
 
 Interest
expense
 
 Interest
expense was $137,504 for the six months ended December 31, 2009, a decrease of
$142,658, or 50.9% as compared to $280,162 for the six months ended December 31,
2008, primarily due to the refinancing of debt from short-term to long-term at a
lower initial interest rate.
 
 Other
Expenses
 
 Other
expenses were $397,441 for the six months ended December 31, 2009, an increase
of $431,771, or 125.8%, as compared to other income of $34,330 for the six
months ended December 31, 2008, primarily a result of a borrowing
expense.
 
 Income
Taxes
 
 Our
business operations were conducted solely by our subsidiaries incorporated in
the PRC and we were governed by the PRC Enterprise Income Tax Laws. China
enterprise income tax is calculated based on taxable income determined under
Chinese GAAP. In accordance with the PRC Income Tax Laws, a Chinese domestic
company is subject to taxes, including but not limited to: (i) enterprise income
tax rate of 25% effective from January 1, 2008; and (ii) value added tax at the
rate of 17% for most of the goods sold.
 
 Provision
for income taxes was $585,723 for the six months ended December 31, 2009, an
increase of $483,316, or 471.9% as compared to $102,407 for the six months ended
December 31, 2008. Such increase was primarily due to the fact that Dalian Befut
was subject to a full 25% income tax rate in the three months ended December 31,
2009, while it paid income tax at a lesser ratio in the corresponding period
ended December 31, 2008.
  24
 
 Net
Income
 
 Net
income for the six months ended December 31, 2009 was $1,684,467, a decrease of
$169,271, or 9.1%, as compared to net income of $1,853,738 for the six months
ended December 31, 2008. The decrease was mainly due to a $889,613 increase in
gross profit, which was offset by an increase in general and administrative
expenses of $616,442 and an increase in provision for income taxes of
$483,316.
 
 Liquidity
and Capital Resources
 
 Selected
Measures of Liquidity and Capital Resources
 
 The
following table sets forth certain relevant measures regarding our liquidity and
capital resources:
 
 (dollars in thousands, except ratios)
                      
                      December 31,
                        2009
                      
                      
                      June 30,
                        2009Cash
      and cash equivalents and restricted cash
                      
                      $
                      5,386
                      
                      
                      $
                      796Working
      capital
                      
                      $
                      23,119
                      
                      
                      $
                      10,033Ratio
      of current assets to current liabilities
                      
                      2.8:1
                      
                      
                      1.8:1
 
 Our $13.1
million increase in working capital from December 31, 2009 to June 30, 2009 was
primarily due to the increase of $5.2 million cash for working capital and the
$8.1 million advance payment for purchasing new, upgraded, multiple production
lines for specialty cable manufacturing.
 
 Cash
Flows
 
 We had a
net increase of $4,589,592 in cash, cash equivalents and restricted
cash from June 30, 2009 to December 31, 2009, as compared to a
net increase of $1,031,807 between June 30, 2008 and December
31, 2008, respectively.  The following table summarizes such
changes:
 
 For the Six Months EndedDecember 31,
                    
                    
                    December 31,(dollars in thousands)
                    
                    2009
                    
                    
                    2008Net
      cash provided by operating activities
                    
                    $
                    1,092
                    
                    
                    $
                    493Net
      cash used in investing activities
                    
                    $
                    10,529
                    
                    
                    $
                    2,546Net
      cash provided by/(used in) financing activities
                    
                    $
                    14,032
                    
                    
                    $
                    3,080Net
      increase in cash and cash equivalents and restricted cash
                    
                    $
                    4,589
                    
                    
                    $
                    1,031
  25
 
 We have
historically financed our operations and capital expenditures principally
through cash provided by operations and bank loans. Our management believes that
we have sufficient cash, along with projected cash to be generated from
operations to support our current operations for the next twelve months. We
believe our cash position is strong and sufficient to meet our anticipated
working capital needs.
 
 Operating
Activities
 
 During
the six months ended December 31, 2009, net cash provided by operating
activities was $1,091,519, as compared to $493,442 in the six months ended
December 31, 2008. We generated positive cash flows from our main operating
activities and support organic growth of our business.
 
 Investing
Activities
 
 During
the six-months ended December 31, 2009, we used net cash in investing
activities of $10,529,764, an increase of $7,983,441 as compared to net cash of
$2,546,353 provided by investing activities for the six months ended
December 31, 2008. This increase was primarily due to a $5.4
million increase in advance payment for fixed assets of new production
lines and a $2 million increase in construction in progress. We successfully
completed our Changxing Island Phase I Construction and equipped multiple new
production lines in the new facilities.
 
 Financing
Activities
 
 During
the six months ended December 31, 2009, net cash provided by financing
activities was $14,032,206, an increase of $10,951,319, as compared to net cash
of $3,080,887 provided by financing activities in the six months ended December
31, 2008. This increase principally reflects the proceeds of a long-term bank
loan of approximately $14.6 million after repayment of short-term bank loans of
approximately $2.8 million in the six months ended December 31, 2009, as
compared to additional borrowings of approximately $3.1 million in the six
months ended December 31, 2008.
 
 Financial
Obligations
 
 As of
December 31, 2009, our outstanding loans were as follows:
 
 Creditors
                      
                      Loan
      Amount
                      
                      
                      Interest
      Rate
                      
                      Term
                      
                      Maturity
      DateHarbin
      Bank
                      
                      $
                      2,934,000
                      
                      
                      
                      6.372
                      %
                      1 year
                      
                      09/15/10Bank
      of Dalian
                      
                      $
                      2,347,200
                      
                      
                      
                      6.903
                      %
                      1 year
                      
                      10/29/10Construction
      Bank of China
                      
                      $
                      5,477,778
                      
                      
                      
                      6.624
                      %
                      5 years
                      
                      11/01/11National
      Development Bank
                      
                      $
                      14,670,000
                      
                      
                      
                      6.237
                      %
                      7 years
                      
                      11/01/16
  26
  Accounts
Receivable
 
 The
balance of accounts receivable was $8,625,800, net of allowance for doubtful
accounts of $20,250, as of December 31, 2009, as compared to $8,560,592, net of
allowance for doubtful accounts of $20,222, as of December 31,
2008.
 
 Inventories
 
 Inventories
consisted of the following as of December 31, 2009 and 2008,
respectively:
 
 (dollars)
                          
                          December 31,
                            2009
                          
                          
                          December 31,
                            2008CategoryRaw
      materials
                          
                          $
                          1,426,328
                          
                          
                          $
                          400,343Work-in-process
                          
                          
                          60,786
                          
                          
                          
                          60,703Finished
      goods
                          
                          
                          869,673
                          
                          
                          
                          892,486Total
      inventories
                          
                          $
                          2,356,787
                          
                          
                          $
                          1,353,532
 
 We had
total inventory of $2,356,787 as of December 31, 2009, an increase of
$1,003,255, or 74.1%, as compared to inventory of $1,353,532 as of December 31,
2008. This increase was primarily due to the increases in purchases of raw
material to meet anticipated higher customer demand for our
products.
 
 Loan to
Unrelated Parties
 
 We had a
net decrease of $1,512,669, or 21.7%, in loans to unrelated parties as of
December 31, 2009 compared as June 30, 2009.
 
 Property
and Equipment
 
 We had a
net increase of approximately $3.9 million in property and equipment as of
December 31, 2009 as compared to June 30, 2009, which was primarily due to an
increase of approximately $1.5 million for the purchase of new cable production
equipment and an increase of approximately $2.5 million construction cost to
complete the Changxing Island Phase I Construction.
 
 Advance
Payments
 
 We had a
net increase of $8,213,650 in advance payments as of December 31, 2009, as
compared to June 30, 2009, which was mainly due to a $7,809,292 in equipment,
which we acquired with a portion of the proceeds of our $14.6 million long-term
bank loan.
  Off-Balance
Sheet Arrangements
 
 At
December 31, 2009, we did not have any off-balance sheet
arrangements.
  27
 
 Critical
Accounting Policies and Use of Estimates
 
 Please
refer to “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” in our Annual Report on Form 10-K for the year ended June
30, 2009 for disclosure regarding our critical accounting policies and
estimates. The interim financial statements follow the same accounting policies
and methods of computation as those for the year ended June 30,
2009.  There were no new accounting policies and estimates during the
period ended December 31, 2009 affecting the Company.
  28




Item
      4T.
            Controls
      and Procedures




(a)         
Evaluation of disclosure
controls and procedures. At the conclusion of the period ended December
31, 2009 we carried out an evaluation, under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the design and operation of our
disclosure controls and procedures (as such term is defined in Rules 13a-15(e)
and 15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)).
Based upon that evaluation, our Chief Executive Officer and Chief Financial
Officer concluded that as of the end of the period covered by this report, our
disclosure controls and procedures were effective and adequately designed to
ensure that the information required to be disclosed by us in the reports we
submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the applicable rules and forms and that
such information was accumulated and communicated to our Chief Executive Officer
and Chief Financial Officer, in a manner that allowed for timely decisions
regarding required disclosure.





(b)         
Changes in internal
controls. During the period covered by this report, there was no change
in our internal control over financial reporting (as such term is defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that has materially
affected, or is reasonably likely to materially affect our internal control over
financial reporting.




PART
II       OTHER INFORMATION





Item
      6.
            Exhibits





The
exhibits required by this item are set forth in the Exhibit Index attached
hereto.


29





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 thereunto duly
authorized.





BEFUT INTERNATIONAL CO., LTD.Date: February 12, 2010
            By:
            /s/Hongbo CaoName: Hongbo CaoTitle: President and Chief Executive Officer(principal executive officer)Date: February 12,  2010
            By:
            /s/ Mei YuName: Mei YuTitle: Chief Financial Officer(principal financial officer and principal
              accounting officer)




30


EXHIBIT
INDEX





No.
            Description





10.1 –
Loan Agreement dated November 2, 2009 by and between PRC National Development
Bank Joint Equity Corporation (“NDB”) and Dalian Befut Wire & Cable
Manufacturing Co., Ltd. (“Dalian Befut”) pursuant to which Dalian Befut borrowed
RMB 100,000,000 (approximately $14,640,000) from NDB.





31.1 –
Certification of Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.





31.2 –
Certification of Chief 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 Chief Financial Officer pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.


31