**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-QSB/A**


**Amendment
      No. 1**


(Mark
      One)





**[X]**
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**





For
      the
      quarterly period ended September 30, 2002.





**[_]**
            **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: 0-29963





**FINDEX.COM,
      INC.**


(Exact
      name of small business issuer as specified in its charter)





Nevada
              88-0379462(State
                  or other jurisdiction of
              (I.R.S.
                  Employerincorporation
                  or organization)
              Identification
                  No.)
  11204
                  Davenport Street, Suite 100, Omaha, Nebraska
              68154(Address
                  of principal executive offices)
              (Zip
                  Code)





(402)
      333-1900


(Issuer’s
      telephone number, including area code)





NA.


(Former
      name, former address and former fiscal year, if changed since last
      report)








Check
      whether the issuer: (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 12 months (or for such shorter period
      that the registrant was required to file such reports), and (2) has been subject
      to such filing requirements for the past 90 days.  **Yes
      [X] No [_]**








**APPLICABLE
      ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE
      YEARS**





Check
      whether the registrant filed all documents and reports required to be filed
      by
      Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities
      under a plan confirmed by a court.  **Yes
      [_] No [_]**








**APPLICABLE
      ONLY TO CORPORATE ISSUERS**





State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date: 48,619,855 common shares as of September
      28,
      2005.





Transitional
      Small Business Disclosure Format (check one):   **Yes
      [_] No [X]**





**Explanatory
      Note**




We
      are
      filing this Amendment Number 1 to our Quarterly Report on Form 10-QSB for the
      three and nine months ended September 30, 2002 to restate our financial
      statements for the quarter then ended to reflect certain issues identified
      during a regulatory review of our financial statements associated with a certain
      registration statement filed with the SEC on November 22, 2004 on Form SB-2
      and
      which is pending effectiveness as of the date of this filing of Amendment Number
      1 to Form 10-QSB for the quarter ended September 30, 2002. There was no net
      effect on either cash provided or used by operating activities, cash used by
      investing activities or cash provided or used by financing activities as a
      result of the corrections to the financial statements for the period covered
      by
      the report.


In
        June
        1999 we entered into a certain license agreement with Parsons Technology,
        Inc.
        to manufacture, distribute and sell a variety of software titles, including
        QuickVerse ® and
        Membership Plus ® ,
        by far
        our two largest selling titles. During
        the three months ended June 30, 2002, we offset the remaining unpaid installment
        under the 1999 license ($1,051,785) against the carrying amount of the license
        in accordance with the terms of a then tentative settlement agreement with
        The
        Learning Company (“TLC”), the licensor-assignee at the time. Although paragraph
        6 of Statement of Financial Accounting Standards (“SFAS”) No. 141, *Business
        Combinations* ,
        which
        guides the recognition and measurement of intangible assets, provides that
        the
        measurement of an asset in which the consideration given is cash is measured
        by
        the amount of cash paid, our management has since concluded that too much
        time
        had elapsed between the date of the 1999 license and the date of the tentative
        settlement agreement for such an offset to be appropriate. Therefore, we
        have
        recognized the extinguishment of the liability owed to TLC as income in the
        condensed consolidated statement of operations for the period covered by
        this
        report. We have restated our condensed consolidated balance sheet as of
        September 30, 2002 and our condensed consolidated statements of operations
        and
        condensed consolidated statements of cash flows for the three and nine months
        then ended.
 
 Also
        during the three months ended June 30, 2002, we extended the estimated life
        of
        the 1999 license from 10 years to 50 years in accordance with the terms of
        the
        tentative settlement agreement. Although the 1999 license, as amended, provides
        for our unlimited and exclusive use of the trademarks related to the licensed
        products, and our management has assessed the useful life of the 1999 license
        as
        indefinite (though limited under the applicable contractual provisions to
        50
        years) based on the estimated future direct or indirect cash flows from the
        license, as provided by paragraphs 11 and 53 of SFAS No. 142, *Goodwill
        and Other Intangible Assets* ,
        our
        management has since concluded that a 10 year life is appropriate based,
        among
        other reasons, on our going concern qualification. We have restated our
        condensed consolidated balance sheet as of September 30, 2002 and our condensed
        consolidated statements of operations and condensed consolidated statements
        of
        cash flows for the three and nine months then ended.
 
 Finally,
        we had previously and erroneously, included rebates in sales and marketing
        expenses. The more appropriate presentation should have been, and is now,
        as a
        reduction to revenue, as provided by EITF 01-09, *Accounting
        for Consideration Given by a Vendor to a Customer (Including a Reseller of
        the
        Vendor’s Products)* .
        As
        provided by paragraph 12 of EITF 01-09, comparative periods presented for
        the
        three and nine months ended September 30, 2001 have been reclassified to
        conform
        with the 2002 presentation.
 
 A
        discussion of the restatement for the quarter ended September 30, 2002 is
        included in Note 13 of the condensed consolidated financial statements included
        in this Amendment Number 1 to Form 10-QSB for the quarter ended September
        30,
        2002. Changes have also been made to the following items as a result of the
        restatement:
  Part
      I  Item
      1Financial
      Statements.


Item
          2Management’s
          Discussion and Analysis of Financial Condition or Plan of
          Operations.
 
 This
          Amendment Number 1 to Form 10-QSB for the quarter ended September 30, 2002
          does
          not otherwise change or update the disclosures set forth in the Form 10-QSB
          as
          originally filed and does not otherwise reflect events occurring after
          the
          filing of the Form 10-QSB. For a description of our business and the risks
          related to our business, please see our Annual Report on Form 10-KSB/A
          for the
          year ended December 31, 2004.


-i-




**PART
      I - FINANCIAL INFORMATION**


**ITEM
      1. FINANCIAL STATEMENTS**


**Findex.com,
                  Inc.****CONDENSED
                  CONSOLIDATED BALANCE SHEETS****(Unaudited)****(Restated)**
              
              
              (Restated)**September
                  30, 2002**
              
              
              December
                  31, 2001**Assets**Current
                  assets:Cash
                  and cash equivalents
              
              **$**
              **24,405**
              
              $
              7,140Accounts
                  receivable, trade
              
              
              **306,690**
              
              
              460,170Inventory
              
              
              **533,357**
              
              
              646,246Other
                  current assets
              
              
              **34,657**
              
              
              21,468Total
                  current assets
              
              
              **899,109**
              
              
              1,135,024Property
                  and equipment, net
              
              
              **102,100**
              
              
              92,185Software
                  license, net
              
              
              **3,398,674**
              
              
              3,776,306Other
                  assets
              
              
              **20,298**
              
              
              12,558Total
                  assets
              
              **$**
              **4,420,181**
              
              $
              5,016,073**Liabilities
                  and stockholders’ equity**Current
                  liabilities:Notes
                  payable
              
              **$**
              **749,999**
              
              $
              749,000License
                  fees payable
              
              
              **---**
              
              
              1,051,785Accrued
                  royalties
              
              
              **2,091,422**
              
              
              2,082,694Accounts
                  payable, trade
              
              
              **1,034,541**
              
              
              1,422,573Current
                  maturities of long-term notes payable
              
              
              **55,877**
              
              
              ---Other
                  current liabilities
              
              
              **1,248,542**
              
              
              1,490,462Total
                  current liabilities
              
              
              **5,180,381**
              
              
              6,796,514Long-term
                  note payable
              
              
              **63,726**
              
              
              71,322Non-current
                  deferred taxes
              
              
              **994,469**
              
              
              1,147,043Commitments
                  and contingenciesStockholders’
                  equity:Preferred
                  stock
              
              
              **51**
              
              
              51Common
                  stock
              
              
              **19,575**
              
              
              11,231Paid-in
                  capital
              
              
              **7,016,308**
              
              
              6,893,720Retained
                  (deficit)
              
              
              **(8,854,329**
              **)**
              
              (9,903,808
              )Total
                  stockholders’ equity
              
              
              **(1,818,395**
              **)**
              
              (2,998,806
              )Total
                  liabilities and stockholders’ equity
              
              **$**
              **4,420,181**
              
              $
              5,016,073*See
                  accompanying notes.*
  F-1
  **Findex.com,
                  Inc.****CONDENSED
                  CONSOLIDATED STATEMENTS OF OPERATIONS****(Unaudited)****Three
                  and Nine Months Ended September 30****Three
                  Months**
              **Nine
                  Months****2002**
              
              
              2001
              
              
              **2002**
              
              
              2001**(Restated)**
              
              
              (Restated)
              
              
              **(Restated)**
              
              
              (Restated)Revenues,
                  net of reserves and allowances
              
              **$**
              **873,813**
              
              $
              465,713
              
              **$**
              **2,931,792**
              
              $
              1,980,466Cost
                  of sales
              
              
              **245,656**
              
              
              164,879
              
              
              **584,497**
              
              
              804,608Gross
                  profit
              
              
              **628,157**
              
              
              300,834
              
              
              **2,347,295**
              
              
              1,175,858Operating
                  expenses:Sales
                  and marketing
              
              
              **202,383**
              
              
              159,374
              
              
              **620,994**
              
              
              486,630General
                  and administrative
              
              
              **436,868**
              
              
              516,514
              
              
              **1,383,640**
              
              
              2,066,058Bad
                  debt expense
              
              
              **---**
              
              
              ---
              
              
              **---**
              
              
              2,391,000Depreciation
                  and amortization
              
              
              **139,951**
              
              
              133,346
              
              
              **408,353**
              
              
              401,404Total
                  operating expenses
              
              
              **779,202**
              
              
              809,234
              
              
              **2,412,987**
              
              
              5,345,092Earnings
                  (loss) from operations
              
              
              **(151,045**
              **)**
              
              (508,400
              )
              
              **(65,692**
              **)**
              
              (4,169,234
              )Other
                  income
              
              
              **191**
              
              
              150
              
              
              **1,051,976**
              
              
              2,791Other
                  expenses, net
              
              
              **(25,276**
              **)**
              
              (27,467
              )
              
              **(89,379**
              **)**
              
              (48,166
              )Income
                  (loss) before income taxes
              
              
              **(176,130**
              **)**
              
              (535,717
              )
              
              **896,905**
              
              
              (4,214,609
              )Provision
                  for income taxes
              
              
              **50,858**
              
              
              102,027
              
              
              **152,574**
              
              
              851,479Net
                  income (loss)
              
              **$**
              **(125,272**
              **)**
              $
              (433,690
              )
              
              **1,049,479**
              
              
              (3,363,130
              )Retained
                  earnings (deficit) at beginning of year
              
              **(9,903,808**
              **)**
              
              (2,299,256
              )Preferred
                  series A common stock dividend
              
              **---**
              
              
              (4,200
              )Retained
                  earnings (deficit) at end of period
              
              
              **$**
              **(8,854,329**
              **)**
              $
              (5,666,586
              )Net
                  earnings (loss) per share:Basic
              
              **$**
              **(0.01**
              **)**
              $
              (0.04
              )
              **$**
              **0.06**
              
              $
              (0.32
              )Diluted
              
              **$**
              **(0.01**
              **)**
              $
              (0.04
              )
              **$**
              **0.06**
              
              $
              (0.32
              )Weighted
                  average shares outstanding:Basic
              
              
              **19,430,789**
              
              
              10,656,341
              
              
              **16,891,916**
              
              
              10,585,742Diluted
              
              
              **19,430,789**
              
              
              10,656,341
              
              
              **19,160,539**
              
              
              10,585,742*See
                  accompanying notes.*
  F-2
  **Findex.com,
                  Inc.****CONSOLIDATED
                  STATEMENTS OF CASH FLOWS****(Unaudited)****Nine
                  Months Ended September 30**
              
              
              **2002**
              
              
              2001**(Restated)**
              
              
              (Restated)Cash
                  flows from operating activities:Cash
                  received from customers
              
              **$**
              **2,928,098**
              
              $
              2,769,535Cash
                  paid to suppliers and employees
              
              
              **(2,755,439**
              **)**
              
              (2,786,032
              )Other
                  operating activities, net
              
              
              **(42,606**
              **)**
              
              (45,378
              )Net
                  cash provided (used) by operating activities
              
              
              **130,053**
              
              
              (61,875
              )Cash
                  flows from investing activities:Acquisition
                  of property and equipment
              
              
              **(43,581**
              **)**
              
              (14,243
              )Other
                  investing activities, net
              
              
              **(4,660**
              **)**
              
              (15,600
              )Net
                  cash (used) by investing activities
              
              
              **(48,241**
              **)**
              
              (29,843
              )Cash
                  flows from financing activities:Proceeds
                  from (payments on) line of credit, net
              
              
              **(4,682**
              **)**
              
              32,708Payments
                  made on long-term notes payable
              
              
              **(34,865**
              **)**
              
              ---Refund
                  on stock subscription
              
              
              **(25,000**
              **)**
              
              ---Proceeds
                  from issuance of stock
              
              
              **---**
              
              
              15,000Addition
                  to license agreements
              
              
              **---**
              
              
              25,073Net
                  cash provided (used) by financing activities
              
              
              **(64,547**
              **)**
              
              72,781Net
                  increase (decrease) in cash and cash equivalents
              
              
              **17,265**
              
              
              (18,937
              )Cash
                  and cash equivalents, beginning of year
              
              
              **7,140**
              
              
              21,768Cash
                  and cash equivalents, end of period
              
              **$**
              **24,405**
              
              $
              2,831Reconciliation
                  of net income (loss) to cash flows from operating
                  activities:Net
                  income (loss)
              
              **$**
              **1,049,479**
              
              $
              (3,363,130
              )Adjustments
                  to reconcile net income (loss) to net cashprovided
                  (used) by operating activities:Stock
                  and warrants issued for services
              
              
              **155,932**
              
              
              302,183Provision
                  for bad debts
              
              
              **---**
              
              
              2,391,000Depreciation
                  & amortization
              
              
              **408,353**
              
              
              401,404Gain
                  on disposal of property and equipment
              
              
              **(137**
              **)**
              
              ---Debt
                  forgiveness
              
              
              **(1,051,785**
              **)**
              
              ---Change
                  in assets and liabilities:Decrease
                  in accounts receivable
              
              
              **153,480**
              
              
              822,299Decrease
                  in inventories
              
              
              **112,889**
              
              
              114,902(Increase)
                  in refundable income taxes
              
              
              **---**
              
              
              (1,548
              )(Increase)
                  in prepaid expenses
              
              
              **(16,461**
              **)**
              
              (25,282
              )Increase
                  in accrued royalties
              
              
              **8,728**
              
              
              258,600Increase
                  (decrease) in accounts payable
              
              
              **(304,885**
              **)**
              
              383,736(Decrease)
                  in income taxes payable
              
              
              **---**
              
              
              (42,556
              )(Decrease)
                  in deferred taxes
              
              
              **(152,574**
              **)**
              
              (843,000
              )(Decrease)
                  in other liabilities
              
              
              **(232,966**
              **)**
              
              (460,483
              )Net
                  cash provided (used) by operating activities
              
              **$**
              **130,053**
              
              $
              (61,875
              )*See
                  accompanying notes.*
  F-3


**FindEx.com,
        Inc.**
 **NOTES
        TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**
 **September
        30, 2002**
 **(unaudited)**
 
 **NOTE
        1 - BASIS OF PRESENTATION**
 
 The
        accompanying unaudited condensed consolidated financial statements have been
        prepared in accordance with generally accepted accounting principles for
        interim
        financial information and with the instructions to Form 10-QSB and Item 310
        of
        Regulation S-B. Accordingly, they do not include all of the information and
        footnotes required by generally accepted accounting principles for complete
        financial statements. Preparing financial statements requires management
        to make
        estimates and assumptions that affect the reported amounts of assets,
        liabilities, revenue and expenses. Examples include provisions for returns,
        bad
        debts, and income taxes along with the realizability of the deferred tax
        assets.
        Actual results may differ from these estimates. The accompanying unaudited
        condensed consolidated financial statements reflect all adjustments that,
        in the
        opinion of management, are considered necessary for a fair presentation of
        the
        financial position, results of operations, and cash flows for the periods
        presented. The results of operations for such periods are not necessarily
        indicative of the results expected for the full fiscal year or for any future
        period. The accompanying financial statements should be read in conjunction
        with
        the audited consolidated financial statements of Findex.com, Inc. included
        in
        our Form 10-KSB for the fiscal year ended December 31, 2001.
 
 **Software
        Development Costs**
 
 In
        accordance with SFAS No. 86, *Accounting
        for the Costs of Computer Software to Be Sold, Leased, or Otherwise
        Marketed* ,
        software development costs are expensed as incurred until technological
        feasibility has been established, at which time such costs are capitalized
        until
        the product is available for general release to customers. Capitalized costs
        are
        amortized on a product-by-product basis using the greater of the straight-line
        method over the estimated product life or on the ratio of current revenues
        to
        total projected product revenues. The Company generally considers technological
        feasibility is established with the release of a beta version for testing.
        Total
        capitalized software development costs at September 30, 2002 were $185,964,
        including $91,509 capitalized during the three months ended September 30,
        2002,
        less accumulated amortization of $19,907. Research and development costs
        incurred and charged to expense were $15,583 and $-0- for the three months
        ended
        September 30, 2002 and 2001, respectively.
 
 **NOTE
        2 - SOFTWARE LICENSE AGREEMENT (Restated)**
 
 During
        the quarter ended June 30, 2002, the Company reclassified the remaining unpaid
        installment ($1,051,785) as debt extinguishment income in accordance with
        the
        terms of a tentative settlement agreement with TLC. In addition, the agreement
        called for the extension of the estimated life of the license from 10 years
        to
        50 years. Management, however, has decided to retain the original 10 year
        life
        based on our going concern opinion. See Notes 9 and 13.
 
 **NOTE
        3 - NOTES PAYABLE (Restated)**
 
 At
        September 30, 2002, notes payable consisted of the following:
 
 Demand
                  note payable to a corporation, with interest at 9%.
                  Unsecured.
              
              $
              650,000Note
                  payable to a corporation, due May 31, 2003, with interest compounded
                  monthly at 1.5%. Unsecured. Convertible at the option of the holder
                  into
                  666,667 restricted common shares.
              
              
              33,333Note
                  payable to a corporation, due May 31, 2003, with interest compounded
                  monthly at 1.5%. Unsecured. Convertible at the option of the holder
                  into
                  666,667 restricted common shares.
              
              
              33,333Note
                  payable to a corporation, due May 31, 2003, with interest compounded
                  monthly at 1.5%. Unsecured. Convertible at the option of the holder
                  into
                  666,667 restricted common shares.
              
              
              33,333$
              749,999
 
 F-4
  **NOTE
        4 - LONG-TERM NOTES PAYABLE**
 
 On
        January 31, 2002, the Company refinanced $154,468 of trade accounts payable
        by
        issuing a long-term note payable to a corporation. The term note is unsecured
        and due October 2004 in monthly installments of $5,285, including interest
        at
        8%.
 
 Principal
        maturities at September 30, 2002 are as follows:
 
 **September
                  30**2003
              
              $
              55,8772004
              
              
              63,726$
              119,603
 
 **NOTE
        5 - STOCKHOLDERS’ EQUITY**
 
 **Common
        Stock**
 
 On
        March
        7, 2002, pursuant to a settlement agreement, the Company issued an additional
        six common shares for each common share originally issued under the stock
        subscription agreement dated April 28, 2000. A total of 2,175,000 common
        shares
        were issued under this settlement agreement. On September 20, 2002, the Company
        issued 9,000 common shares correcting an error in the March
        issuance.
 
 On
        April
        1, 2002, the Company issued 5,891,760 restricted common shares to the employees
        and Board of Directors as additional compensation pursuant to an incentive
        and
        retention bonus program. On August 7, 2002, the Company rescinded 64,480
        restricted common shares previously issued to part-time employees under the
        incentive and retention bonus program. These shares were valued at $.025
        per
        share.
 
 On
        July
        23, 2002, in settlement of a consulting agreement with an individual for
        investor relations services, the Company issued 205,000 common shares valued
        at
        $.05 per share.
 
 On
        September 20, 2002, pursuant to a settlement agreement, the Company issued
        an
        additional six common shares for each common share originally issued in lieu
        of
        cash commission under the stock subscription agreement dated April 28, 2000.
        A
        total of 137,250 common shares were issued under this settlement
        agreement.
 
 **NOTE
        6 - INCOME TAXES (Restated)**
 
 The
        benefit for taxes on income for the three and nine months ended September
        30
        consisted of the following:
 
 **Three
                  Months Ended September 30,**
              **Nine
                  Months Ended September 30,****(Restated)**
              
              
              
              
              
              **(Restated)****2002**
              
              
              2001
              
              
              **2002**
              
              
              2001Current:Federal
              
              **$**
              **---**
              
              $
              ---
              
              **$**
              **---**
              
              $
              ---State
              
              
              **---**
              
              
              (5,973
              )
              
              **---**
              
              
              8,479**---**
              
              
              (5,973
              )
              
              **---**
              
              
              8,479Deferred:Federal
              
              
              **40,699**
              
              
              81,250
              
              
              **122,097**
              
              
              632,250State
              
              
              **10,159**
              
              
              26,750
              
              
              **30,477**
              
              
              210,750**50,858**
              
              
              108,000
              
              
              **152,574**
              
              
              843,000Total
                  tax benefit
              
              **$**
              **50,858**
              
              $
              102,027
              
              **$**
              **152,574**
              
              $
              851,479
 
 F-5
  **NOTE
        7 - EARNINGS PER COMMON SHARE (Restated)**
 
 Earnings
        per common share are computed by dividing net income (loss) by the weighted
        average number of common shares and common stock equivalents outstanding
        during
        the year. Common stock equivalents are the net additional number of shares
        that
        would be issuable upon the exercise of the outstanding common stock options,
        assuming that the Company reinvested the proceeds to purchase additional
        shares
        at market value. A total of 6,092,200 and 3,808,200 potentially dilutive
        securities for the three and nine months ended September 30, 2002, respectively,
        and 4,237,200 potentially dilutive securities for the three and nine months
        ended September 30, 2001, have been excluded from the computation of diluted
        earnings per share, as their inclusion would be anti-dilutive.
 
 The
        following table shows the amounts used in computing earnings per share and
        the
        effect on income (loss) and the average number of shares of dilutive potential
        common stock:
 
 **For
                    the Three Months Ended September 30, 2001**
                
                
                **Income
                    (Loss) (Numerator)**
                
                
                **Shares
                    (Denominator)**
                
                
                **Per-share
                    Amount**Net
                    Loss
                
                $
                (433,690
                )Less
                    preferred stock dividends
                
                
                (4,200
                )Loss
                    available to common stockholders-basic earnings per share
                
                
                (437,890
                )
                
                10,656,341
                
                $
                (0.04
                )Effect
                    of Dilutive SecuritiesOptions
                
                
                ---
                
                
                ---Convertible
                    notes payable
                
                
                ---
                
                
                ---Convertible
                    Preferred Series A
                
                
                ---
                
                
                ---Convertible
                    Preferred Series B
                
                
                ---
                
                
                ---Warrants
                
                
                ---
                
                
                ---Loss
                    available to common stockholders-diluted earnings per
                    share
                
                $
                (437,890
                )
                
                10,656,341
                
                $
                (0.04
                )**For
                    the Three Months Ended September 30, 2002**
                
                
                **Income
                    (Loss) (Numerator)**
                
                
                **Shares
                    (Denominator)**
                
                
                **Per-share
                    Amount**Net
                    Loss (restated)
                
                $
                (125,272
                )Less
                    preferred stock dividends
                
                
                ---Loss
                    available to common stockholders-basic earnings per share
                
                
                (125,272
                )
                
                19,430,789
                
                $
                (0.01
                )Effect
                    of Dilutive SecuritiesOptions
                
                
                ---
                
                
                ---Convertible
                    notes payable
                
                
                ---
                
                
                ---Convertible
                    Preferred Series A
                
                
                ---
                
                
                ---Convertible
                    Preferred Series B
                
                
                ---
                
                
                ---Warrants
                
                
                ---
                
                
                ---Loss
                    available to common stockholders-diluted earnings per
                    share
                
                $
                (125,272
                )
                
                19,430,789
                
                $
                (0.01
                )**For
                    the Nine Months Ended September 30, 2001**
                
                
                **Income
                    (Loss) (Numerator)**
                
                
                **Shares
                    (Denominator)**
                
                
                **Per-share
                    Amount**Net
                    Loss
                
                $
                (3,363,130
                )Less
                    preferred stock dividends
                
                
                (4,200
                )Loss
                    available to common stockholders-basic earnings per share
                
                
                (3,367,330
                )
                
                10,585,742
                
                $
                (0.32
                )Effect
                    of Dilutive SecuritiesOptions
                
                
                ---
                
                
                ---Convertible
                    notes payable
                
                
                ---
                
                
                ---Convertible
                    Preferred Series A
                
                
                ---
                
                
                ---Convertible
                    Preferred Series B
                
                
                ---
                
                
                ---Warrants
                
                
                ---
                
                
                ---Income
                    available to common stockholders-diluted earnings per
                    share
                
                $
                (3,367,330
                )
                
                10,585,742
                
                $
                (0.32
                )
  F-6
  **For
                    the Nine Months Ended September 30, 2002**
                
                
                **Income
                    (Loss) (Numerator)**
                
                
                **Shares
                    (Denominator)**
                
                
                **Per-share
                    Amount**Net
                    Income (restated)
                
                $
                1,049,479Less
                    preferred stock dividends
                
                
                ---Income
                    available to common stockholders-basic earnings per share
                
                
                1,049,479
                
                
                16,891,916
                
                $
                0.06Effect
                    of Dilutive SecuritiesOptions
                
                
                ---
                
                
                ---Convertible
                    notes payable
                
                
                16,584
                
                
                2,000,000Convertible
                    Preferred Series A
                
                
                ---
                
                
                114,000Convertible
                    Preferred Series B
                
                
                ---
                
                
                40,000Warrants
                    (restated)
                
                
                ---
                
                
                114,623Income
                    available to common stockholders-diluted earnings per
                    share
                
                $
                1,066,063
                
                
                19,160,539
                
                $
                0.06
 
 **NOTE
        8 - SUPPLEMENTAL CASH FLOW INFORMATION**
 
 The
        Company incurred the following non-cash investing and financing activities
        during the nine months ended September 30, 2002 and 2001,
        respectively:
 
 **2002**
              
              
              2001Common
                  stock and warrants issued for services
              
              **$**
              **155,932**
              
              $
              302,183Common
                  stock dividend
              
              
              **---**
              
              
              4,200Conversion
                  of preferred stock to common stock
              
              
              **---**
              
              
              32
 
 **NOTE
        9 - COMMITMENTS AND CONTINGENCIES**
 
 The
        Company is subject to legal proceedings and claims that arise in the ordinary
        course of its business. In the opinion of management, the amount of ultimate
        liability with respect to these actions will not materially affect the financial
        position of the Company.
 
 On
        November 14, 2001, The Zondervan Corporation elected to enforce a court order
        and served notice that we cease selling, marketing and manufacturing all
        products containing their copyrighted material. We are abiding by the court
        order and are no longer shipping products containing Zondervan’s copyrighted
        material. We are continuing negotiations with Zondervan to reach a settlement
        that will allow us to resume shipment of those products. Company management
        believes the amount of any potential loss cannot be reasonably
        estimated.
 
 The
        Company has reached tentative settlement in a dispute with TLC over various
        provisions of several agreements, including the software license agreement.
        Ultimate disposition of this tentative settlement is contingent upon settlement
        of negotiations with The Zondervan Corporation. Company management believes
        the
        amount of any potential loss cannot be reasonably estimated.
 
 On
        September 6, 2002, Swartz Private Equity, LLC provided notice that it was
        making
        a demand under the Equity Line Agreement for the termination fee provided
        thereunder in the amount of $150,000. We are currently disputing this amount
        and
        have entered into settlement discussions with them. Ultimate disposition
        is
        uncertain and management believes the amount of any potential loss cannot
        be
        reasonably estimated at this time.
 
 F-7
  **NOTE
        10 - RISKS AND UNCERTAINTIES**
 
 The
        Company’s future operating results may be affected by a number of factors. The
        Company is dependent upon a number of major inventory and intellectual property
        suppliers. If a critical supplier had operational problems or ceased making
        material available to the Company, operations could be adversely affected.
        The
        Company is also dependent upon a few major customers. If any of these customers
        experienced operational problems or ceased placing orders with the Company,
        operations could also be adversely affected.
 
 **NOTE
        11 - GOING CONCERN**
 
 The
        accompanying financial statements have been prepared assuming the Company
        will
        continue as a going concern. The Company has a history of operating losses,
        a
        negative current ratio and total liabilities in excess of total assets. Those
        factors, as well as uncertainty in securing financing for continued operations,
        uncertainty related to the outcomes of disputes with Zondervan and TLC, and
        the
        uncertainty related to renegotiation of the demand notes payable, create
        an
        uncertainty about the Company’s ability to continue as a going concern.
        Management of the Company has developed a plan to reduce its liabilities
        through
        sales of a new release of one of the Company’s flagship software titles. The
        ability of the Company to continue as a going concern is dependent on the
        acceptance of the plan by the Company’s creditors, the plan’s success, and the
        renegotiation of the demand notes payable. The financial statements do not
        include any adjustments that might result from the outcome of this uncertainty.
 
 **NOTE
        12 - SUBSEQUENT EVENT**
 
 On
        October 17, 2002, pursuant to a settlement agreement for unpaid consulting
        and
        valuation services, the Company issued 296,308 common shares valued at $.03
        per
        share.
 
 **NOTE
        13 - RESTATEMENT AND RECLASSIFICATION**
  The
        Company has restated its financial statements for the three and nine months
        ended September 30, 2002 to correct errors identified during a regulatory
        review
        of our financial statements with a certain registration statement filed with
        the
        SEC on November 22, 2004 on Form SB-2 and which is pending effectiveness
        as of
        the date of this filing of Amendment Number 1 to Form 10-QSB for the quarter
        ended September 30, 2002. There was no net effect on cash provided or used
        by
        operating activities, cash used by investing or cash provided or used by
        financing activities as a result of these errors.
 During
          the three month period ended June 30, 2002, we erroneously offset the remaining
          unpaid installment ($1,051,785) against the carrying amount of the 1999
          software
          license in accordance with the terms of the tentative settlement agreement
          with
          TLC, the licensor-assignee at the time. Although paragraph 6 of SFAS No.
          141, *Business
          Combinations* ,
          which
          guides the recognition and measurement of intangible assets, provides that
          the
          measurement of assets in which the consideration given is cash are measured
          by
          the amount of cash paid, our management believes that too much time had
          passed
          between the date of the agreement (June 1999) and the date of the tentative
          settlement (May 2002) for such an offset to be appropriate. The Company
          has
          recognized the extinguishment of the liability owed to TLC as income in
          the
          statement of operations. In accordance, we have restated the condensed
          consolidated balance sheet as of September 30, 2002 and the condensed
          consolidated statements of operations and condensed consolidated statements
          of
          cash flows for the three and nine months then ended.
 
 Also
          during the three month period ended June 30, 2002, we had erroneously extended
          the estimated life of the 1999 software license from 10 years to 50 years
          in
          accordance with the terms of the tentative settlement agreement with TLC.
          Although the 1999 software license provides for the unlimited and exclusive
          use
          of the trademarks related to the licensed products, and our management
          has
          assessed the useful life of the 1999 software license as indefinite, (though
          limited under the applicable contractual provisions to 50 years) based
          on the
          estimated future direct or indirect cash flows from the license, as provided
          by
          paragraphs 53 and 11 of SFAS No. 142, *Goodwill
          and Other Intangible Assets* ,
          our
          management believes a 10 year life is appropriate based, among other reasons,
          on
          our going concern qualification. In accordance, we have restated the condensed
          consolidated balance sheet as of September 30, 2002 and the condensed
          consolidated statements of operations and condensed consolidated statements
          of
          cash flows for the three and nine months then ended.
 
 Finally,
          we had previously and erroneously, included rebates in sales and marketing
          expenses. The more appropriate presentation should have been, and is now,
          as a
          reduction to revenue, as provided by EITF 01-09, *Accounting
          for Consideration Given by a Vendor to a Customer (Including a Reseller
          of the
          Vendor’s Products)* .
          As
          provided by paragraph 12 of EITF 01-09, comparative periods presented for
          the
          three and nine months ended September 30, 2001 have been reclassified to
          conform
          with the 2002 presentation.
 F-8
  A
        summary
        of the effects of these changes is as follows:


**Findex.com,
                    Inc.****CONSOLIDATED
                    BALANCE SHEETS****September
                    30, 2002****As
                    Previously
                    Reported**
                
                
                **As
                    Restated**
                
                
                **Change****Assets**Current
                    assets:Cash
                    and cash equivalents
                
                
                
                
                $
                24,405
                
                $
                24,405
                
                $
                ---Accounts
                    receivable, trade
                
                
                
                
                
                306,690
                
                
                306,690
                
                
                ---Inventories
                
                
                
                
                
                533,357
                
                
                533,357
                
                
                ---Other
                    current assets
                
                
                
                
                
                34,657
                
                
                34,657
                
                
                ---Total
                    current assets
                
                
                
                
                
                899,109
                
                
                899,109
                
                
                ---Property
                    and equipment, net
                
                102,100
                
                
                102,100
                
                
                ---Software
                    license, net
                
                2,571,145
                
                
                3,398,674
                
                
                827,529
                
                (a)Other
                    assets
                
                20,298
                
                
                20,298
                
                
                ---Total
                    assets
                
                
                
                
                $
                3,592,652
                
                $
                4,420,181
                
                $
                827,529**Liabilities
                    and stockholders’ equity**Current
                    liabilities:Accounts
                    payable, trade
                
                
                
                
                $
                1,133,489
                
                $
                1,034,541
                
                $
                (98,948
                )
                (b)Notes
                    payable
                
                
                
                
                
                749,999
                
                
                749,999
                
                
                ---Accrued
                    royalties
                
                
                
                
                
                2,091,422
                
                
                2,091,422
                
                
                ---Accrued
                    expenses
                
                
                
                
                
                2,341,585
                
                
                1,248,542
                
                
                (1,093,043
                )
                (c)Current
                    maturities of long-term debt
                
                
                
                
                
                55,877
                
                
                55,877
                
                
                ---Total
                    current liabilities
                
                
                
                
                
                6,372,372
                
                
                5,180,381
                
                
                (1,191,991
                )Long-term
                    note payable
                
                63,726
                
                
                63,726
                
                
                ---Deferred
                    income taxes, net
                
                ---
                
                
                994,469
                
                
                994,469
                
                (d)Stockholders’
                    equity:Preferred
                    stock, $.001 par value
                
                
                
                
                
                51
                
                
                51
                
                
                ---Common
                    stock, $.001 par value
                
                
                
                
                
                19,575
                
                
                19,575
                
                
                ---Paid-in
                    capital
                
                
                
                
                
                7,016,308
                
                
                7,016,308
                
                
                ---Retained
                    (deficit)
                
                
                
                
                
                (9,879,380
                )
                
                (8,854,329
                )
                
                1,025,051Total
                    stockholders’ equity
                
                
                
                
                
                (2,843,446
                )
                
                (1,818,395
                )
                
                1,025,051Total
                    liabilities and stockholders’ equity
                
                
                
                
                $
                3,592,652
                
                $
                4,420,181
                
                $
                827,529(a)Increased
                    by $1,051,785 reclassification of forgiven final installment
                    payment and
                    decreased by $224,256
                    additional amortization from reducing the estimated useful life
                    from 50
                    years to 10 years.(b)Decreased
                    by $98,948 from 2000 overstatement of trade payable to third-party
                    rebate
                    processor.(c)Decreased
                    by $1,093,043 for reclassification of deferred income taxes as
                    non-current.(d)Increased
                    by $994,469 for recalculation of deferred income taxes resulting
                    from
                    reclassification of forgiven
                    final installment payment and additional amortization from reducing
                    the
                    estimated useful life
                    of the software
                    license.
  F-9
  **Findex.com,
                    Inc.****CONSOLIDATED
                    STATEMENTS OF OPERATIONS****For
                    the Nine Months Ended September 30, 2002****As
                    Previously Reported**
                
                
                **As
                    Restated**
                
                
                **Change**Revenues,
                    net of reserves and allowances
                $
                2,932,466
                
                $
                2,931,792
                
                $
                (674
                )
                (a)Cost
                    of sales
                
                572,201
                
                
                584,497
                
                
                12,296
                
                (b)Gross
                    profit
                
                
                
                
                
                2,360,265
                
                
                2,347,295
                
                
                (12,970
                )Operating
                    expenses:Sales
                    and marketing
                
                
                
                
                
                633,964
                
                
                620,994
                
                
                (12,970
                )General
                    and administrative
                
                
                
                
                
                1,383,640
                
                
                1,383,640
                
                
                ---Depreciation
                    and amortization
                
                
                
                
                
                184,098
                
                
                408,353
                
                
                224,255
                
                (c)Total
                    operating expenses
                
                
                
                
                
                2,201,702
                
                
                2,412,987
                
                
                211,285Earnings
                    from operations
                
                158,563
                
                
                (65,692
                )
                
                (224,255
                )Other
                    income
                
                191
                
                
                1,051,976
                
                
                1,051,785
                
                (d)Other
                    expenses, net
                
                (89,379
                )
                
                (89,379
                )
                
                ---Income
                    before income taxes
                
                
                
                
                
                69,375
                
                
                896,905
                
                
                827,530Provision
                    for income taxes
                
                54,000
                
                
                152,574
                
                
                98,574
                
                (e)Net
                    income
                
                
                
                
                $
                123,375
                
                $
                1,049,479
                
                $
                926,104Net
                    earnings per share:Basic
                
                
                
                
                $
                0.01
                
                $
                0.06
                
                $
                0.05Diluted
                
                
                
                
                $
                0.01
                
                $
                0.06
                
                $
                0.05Weighted
                    average shares outstanding:Basic
                
                
                
                
                
                16,891,916
                
                
                16,891,916
                
                
                ---Diluted
                
                
                
                
                
                19,025,916
                
                
                19,160,539
                
                
                134,623(a)Decrease
                    from reclassification of rebates from sales and
                    marketing.(b)Increase
                    from reclassification of fulfillment expenses from sales and
                    marketing.(c)Increase
                    from reducing the estimated useful life of the software license
                    from 50
                    years to 10 years.(d)Increased
                    by $1,051,785 reclassification of forgiven final installment
                    payment.(e)Increased
                    from recalculation of deferred income taxes resulting from
                    reclassification of forgiveness of final
                    installment of the software license and reduction of the estimated
                    useful
                    life from 50 years to 10 years.
  F-10
  **Findex.com,
                    Inc.****CONSOLIDATED
                    STATEMENTS OF OPERATIONS****For
                    the Three Months Ended September 30, 2002****As
                    Previously Reported**
                
                
                **As
                    Restated**
                
                
                **Change**Revenues,
                    net of reserves and allowances
                $
                873,705
                
                $
                873,813
                
                $
                108
                
                (a)Cost
                    of sales
                
                233,360
                
                
                245,656
                
                
                12,296
                
                (b)Gross
                    profit
                
                
                
                
                
                640,345
                
                
                628,157
                
                
                (12,188
                )Operating
                    expenses:Sales
                    and marketing
                
                
                
                
                
                214,571
                
                
                202,383
                
                
                (12,188
                )General
                    and administrative
                
                
                
                
                
                436,868
                
                
                436,868
                
                
                ---Depreciation
                    and amortization
                
                
                
                
                
                27,518
                
                
                139,951
                
                
                112,433
                
                (c)Total
                    operating expenses
                
                
                
                
                
                678,957
                
                
                779,202
                
                
                100,245Earnings
                    (loss) from operations
                
                (38,612
                )
                
                (151,045
                )
                
                (112,433
                )Other
                    income
                
                191
                
                
                191
                
                
                ---Other
                    expenses, net
                
                (25,276
                )
                
                (25,276
                )
                
                ---Loss
                    before income taxes
                
                
                
                
                
                (63,697
                )
                
                (176,130
                )
                
                (112,433
                )Provision
                    for income taxes
                
                18,000
                
                
                50,858
                
                
                32,858
                
                (d)Net
                    loss
                
                
                
                
                $
                (45,697
                )
                $
                (125,272
                )
                $
                (79,575
                )Net
                    earnings (loss) per share:Basic
                
                
                
                
                $
                (0.00
                )
                $
                (0.01
                )
                $
                (0.01
                )Diluted
                
                
                
                
                $
                (0.00
                )
                $
                (0.01
                )
                $
                (0.01
                )Weighted
                    average shares outstanding:Basic
                
                
                
                
                
                19,430,789
                
                
                19,430,789
                
                
                ---Diluted
                
                
                
                
                
                19,430,789
                
                
                19,430,789
                
                
                ---(a)Increase
                    from reclassification of rebate adjustment from sales and
                    marketing.(b)Increase
                    from reclassification of fulfillment expenses from sales and
                    marketing.(c)Increase
                    from reducing the estimated useful life of the software license
                    from 50
                    years to 10 years.(d)Increased
                    from recalculation of deferred income taxes resulting from
                    reclassification of forgiveness of final
                    installment of the software license and reduction of the estimated
                    useful
                    life from 50 years to 10 years.
  F-11
  **Findex.com,
                    Inc.****CONSOLIDATED
                    STATEMENTS OF OPERATIONS****For
                    the Nine Months Ended September 30, 2001****As
                    Previously Reported**
                
                
                **As
                    Restated**
                
                
                **Change**Revenues,
                    net of reserves and allowances
                $
                2,172,211
                
                $
                1,980,466
                
                $
                (191,745
                )
                (a)Cost
                    of sales
                
                804,608
                
                
                804,608
                
                
                ---Gross
                    profit
                
                
                
                
                
                1,367,603
                
                
                1,175,858
                
                
                (191,745
                )Operating
                    expenses:Sales
                    and marketing
                
                
                
                
                
                678,375
                
                
                486,630
                
                
                (191,745
                )
                (a)General
                    and administrative
                
                
                
                
                
                2,066,058
                
                
                2,066,058
                
                
                ---Bad
                    debt expense
                
                
                
                
                
                2,391,000
                
                
                2,391,000
                
                
                ---Depreciation
                    and amortization
                
                
                
                
                
                401,404
                
                
                401,404
                
                
                ---Total
                    operating expenses
                
                
                
                
                
                5,536,837
                
                
                5,345,092
                
                
                (191,745
                )Earnings
                    (loss) from operations
                
                (4,169,234
                )
                
                (4,169,234
                )
                
                ---Other
                    income
                
                2,791
                
                
                2,791
                
                
                ---Other
                    expenses, net
                
                (48,166
                )
                
                (48,166
                )
                
                ---Loss
                    before income taxes
                
                
                
                
                
                (4,214,609
                )
                
                (4,214,609
                )
                
                ---Provision
                    for income taxes
                
                851,479
                
                
                851,479
                
                
                ---Net
                    loss
                
                
                
                
                $
                (3,363,130
                )
                $
                (3,363,130
                )
                $
                ---Net
                    earnings(loss) per share:Basic
                
                
                
                
                $
                (0.32
                )
                $
                (0.32
                )
                $
                ---Diluted
                
                
                
                
                $
                (0.32
                )
                $
                (0.32
                )
                $
                ---Weighted
                    average shares outstanding:Basic
                
                
                
                
                
                10,585,742
                
                
                10,585,742
                
                
                ---Diluted
                
                
                
                
                
                10,585,742
                
                
                10,585,742
                
                
                ---(a)Decrease
                    from reclassification of rebates from sales and
                    marketing.
  F-12
  **Findex.com,
                    Inc.****CONSOLIDATED
                    STATEMENTS OF OPERATIONS****For
                    the Three Months Ended September 30, 2001****As
                    Previously Reported**
                
                
                **As
                    Restated**
                
                
                **Change**Revenues,
                    net of reserves and allowances
                
                $
                465,713
                
                $
                465,713
                
                $
                ---Cost
                    of sales
                
                
                164,879
                
                
                164,879
                
                
                ---Gross
                    profit
                
                
                300,834
                
                
                300,834
                
                
                ---Operating
                    expenses:Sales
                    and marketing
                
                
                159,374
                
                
                159,374
                
                
                ---General
                    and administrative
                
                
                516,514
                
                
                516,514
                
                
                ---Depreciation
                    and amortization
                
                
                133,346
                
                
                133,346
                
                
                ---Total
                    operating expenses
                
                
                809,234
                
                
                809,234
                
                
                ---Earnings
                    (loss) from operations
                
                
                (508,400
                )
                
                (508,400
                )
                
                ---Other
                    income
                
                
                150
                
                
                150
                
                
                ---Other
                    expenses, net
                
                
                (27,467
                )
                
                (27,467
                )
                
                ---Loss
                    before income taxes
                
                
                (535,717
                )
                
                (535,717
                )
                
                ---Provision
                    for income taxes
                
                
                102,027
                
                
                102,027
                
                
                ---Net
                    loss
                
                $
                (433,690
                )
                $
                (433,690
                )
                $
                ---Net
                    earnings (loss) per share:Basic
                
                $
                (0.04
                )
                $
                (0.04
                )
                $
                ---Diluted
                
                $
                (0.04
                )
                $
                (0.04
                )
                $
                ---Weighted
                    average shares outstanding:Basic
                
                
                10,656,341
                
                
                10,656,341
                
                
                ---Diluted
                
                
                10,656,341
                
                
                10,656,341
                
                
                ---
  F-13
  **Findex.com,
                    Inc.****CONSOLIDATED
                    STATEMENTS OF CASH FLOWS****For
                    the Nine Months Ended September 30, 2002****As
                    Previously Reported**
                
                
                **As
                    Restated**
                
                
                **Change**Cash
                    flows from operating activities:Cash
                    received from customers
                
                
                
                
                $
                2,928,098
                
                $
                2,928,098
                
                $
                ---Cash
                    paid to suppliers and employees
                
                
                
                
                
                (2,755,439
                )
                
                (2,755,439
                )
                
                ---Interest
                    paid
                
                
                
                
                
                (42,660
                )
                
                (42,660
                )
                
                ---Interest
                    received
                
                
                
                
                
                54
                
                
                54
                
                
                ---Net
                    cash provided by operating activities
                
                
                
                
                
                130,053
                
                
                130,053
                
                
                ---Cash
                    flows from investing activities:Acquisition
                    of property and equipment
                
                
                
                
                
                (43,581
                )
                
                (43,581
                )
                
                ---Proceeds
                    from sale of property and equipment
                
                
                
                
                
                4,000
                
                
                4,000
                
                
                ---Deposits
                    made
                
                
                
                
                
                (6,208
                )
                
                (6,208
                )
                
                ---Website
                    development costs
                
                
                
                
                
                (2,452
                )
                
                (2,452
                )
                
                ---Net
                    cash (used) by investing activities
                
                
                
                
                
                (48,241
                )
                
                (48,241
                )
                
                ---Cash
                    flows from financing activities:Proceeds
                    from (payments on) line of credit, net
                
                
                
                
                
                (4,682
                )
                
                (4,682
                )
                
                ---Payments
                    made on long-term notes payable
                
                
                
                
                
                (34,865
                )
                
                (34,865
                )
                
                ---Refund
                    on stock subscription
                
                
                
                
                
                (25,000
                )
                
                (25,000
                )
                
                ---Net
                    cash (used) by financing activities
                
                
                
                
                
                (64,547
                )
                
                (64,547
                )
                
                ---Net
                    increase in cash and cash equivalents
                
                17,265
                
                
                17,265
                
                
                ---Cash
                    and cash equivalents, beginning of year
                
                7,140
                
                
                7,140
                
                
                ---Cash
                    and cash equivalents, end of year
                
                
                
                
                $
                24,405
                
                $
                24,405
                
                $
                ---Reconciliation
                    of net income to cash flows from operating activities:Net
                    income
                
                
                
                
                $
                123,375
                
                $
                1,049,479
                
                $
                926,104Adjustments
                    to reconcile net income to net cashprovided
                    by operating activities:Stock
                    and warrants issued for services
                
                
                
                
                
                155,932
                
                
                155,932
                
                
                ---Depreciation
                    & amortization
                
                
                
                
                
                184,098
                
                
                408,353
                
                
                224,255
                
                (a)Gain
                    on disposal of property and equipment
                
                
                
                
                
                (137
                )
                
                (137
                )
                
                ---Debt
                    forgiveness
                
                
                
                
                
                ---
                
                
                (1,051,785
                )
                
                (1,051,785
                )
                (b)Change
                    in assets and liabilities:Decrease
                    in accounts receivable
                
                
                
                
                
                153,480
                
                
                153,480
                
                
                ---Decrease
                    in inventories
                
                
                
                
                
                112,889
                
                
                112,889
                
                
                ---Increase
                    in prepaid expenses
                
                
                
                
                
                (16,461
                )
                
                (16,461
                )
                
                ---Increase
                    in accrued royalties
                
                
                
                
                
                8,728
                
                
                8,728
                
                
                ---(Decrease)
                    in accounts payable
                
                
                
                
                
                (304,885
                )
                
                (304,885
                )
                
                ---(Decrease)
                    in deferred taxes
                
                
                
                
                
                (54,000
                )
                
                (152,574
                )
                
                (98,574
                )
                (c)(Decrease)
                    in other liabilities
                
                
                
                
                
                (232,966
                )
                
                (232,966
                )
                
                ---Net
                    cash provided by operating activities
                
                
                
                
                $
                130,053
                
                $
                130,053
                
                $
                ---(a)Increase
                    from reducing the estimated useful life of the software license
                    from 50
                    years to 10 years.(b)Increased
                    by $1,051,785 reclassification of forgiven final installment
                    payment.(c)Increased
                    from recalculation of deferred income taxes resulting from
                    reclassification of forgiveness of final
                    installment of the software license and reduction of the estimated
                    useful
                    life from 50 years to 10 years.
  F-14


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


**Forward-Looking
      Statements**





This
      report on Form 10-QSB includes “forward-looking statements” within the meaning
      of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
      Exchange Act of 1934. We identify forward-looking statements in this report
      by
      using words or phrases such as
“anticipate,”“believe,”“estimate,”“expect,”“intend,”“may
      be,”“objective,”“plan,”“predict,”“project,” and “will be” and similar words or
      phrases, or the negative thereof. These forward-looking statements may relate
      to
      such matters as anticipated financial performance, future revenues or earnings,
      business prospects, projected ventures, new products and services, anticipated
      market performance and similar matters. The Private Securities Litigation Reform
      Act of 1995 provides a safe harbor for forward-looking statements. To comply
      with the terms of the safe harbor, we caution readers that a variety of factors
      could cause our actual results to differ materially from the anticipated results
      or other expressed in our forward-looking statements. These risks and
      uncertainties, many of which are beyond our control, include (i) As of September
      30, 2002, our current liabilities exceeded our current assets by $4,281,272
      and
      our auditors included a “going concern” footnote in our audited financial
      statements for our last fiscal year ended December 31, 2001, (ii) we are
      currently in arrears in the payment of approximately $230,000 of payroll taxes,
      (iii) the outcome of our pending litigation with The Zondervan Corporation,
      (iv)
      the sufficiency of our existing capital resources and our ability to raise
      additional capital to fund cash requirements for future operations, (v) our
      ability to meet ongoing royalty payments owed, (vi) our ability to sustain
      sales
      of major product lines notwithstanding the removal of certain highly
      acknowledged and popular content, (vii) our dependence on third parties to
      fulfill a significant portion of our orders, (viii) uncertainties involved
      in
      our ability to introduce new products, (ix) our ability to retain key executives
      and other personnel, (x) product returns exceed reserves, (xi) potential
      infringement of the intellectual property rights of others, and (xii) general
      economic conditions as well as the other risks identified under the Section
      entitled “CAUTIONARY STATEMENTS AND RISK FACTORS” in our Annual Report on Form
      10-KSB for the fiscal year ended December 31, 2001. Readers are encouraged
      to
      carefully review the risk factors contained therein.





Although
      we believe that the expectations reflected in these forward-looking statements
      are reasonable, we cannot give any assurance that such expectations reflected
      in
      these forward-looking statements will prove to have been correct.





We
      cannot
      guarantee any future results, levels of activity, performance or achievements.
      Except as required by law, we undertake no obligation to update any of the
      forward-looking statements in this Form 10-QSB/A after the date of this report.





**GENERAL**





We
      are a
      developer, publisher, distributor and supplier of “inspirational” and Christian
      faith-based, off-the-shelf software products to individuals and religious and
      other spiritual organizations including schools, churches and other faith-based
      ministries.





Our
      business plan is focused on fulfilling our objective of becoming the premier
      provider of Bible study and related software products and content to the
      domestic and international markets, through both acquiring established companies
      and ongoing internal development of new products and expanded content of
      existing products. Our religious software titles are divided among six
      categories: (i) QuickVerse/Bible Study, (ii) Financial/Office Management
      Products for Churches and other Christian Faith-Based Ministries, (iii) Print
      & Graphic Products, (iv) Pastoral Products, (v) Children’s Products, and
      (vi) Language Tutorial Products.





At
      the
      retail level, we sell our software products to thousands of retail stores across
      the United States, many of which are members of the Christian Bookseller’s
      Association (“CBA”). These stores vary from small, family-owned Christian
      bookstores to large chain bookstores such as LifeWay Christian Stores, Family
      Christian Stores and Berean Christian Stores. We face the continuing challenge
      of reaching these stores on a consistent basis to keep them informed of new
      releases, promotional offers, etc. In addition to advertising in trade
      publications and maintaining visibility at CBA trade shows and events, we
      believe that it is critical to be in direct personal contact with each customer
      routinely in order to maintain or increase our market position. Towards that
      end, our sales representatives are expected to contact each of our customers
      as
      well as each of the 3,500 independent stores, some of which are not yet our
      customers, at least once each calendar quarter and present them with the latest
      in our products and promotions. We believe our personalized approach to
      marketing provides us with an edge over our competition, which we believe rely
      predominantly on advertising to maintain and develop their relations with CBA
      customers.





-1-




In
      addition to retail sales, we also sell our software at the wholesale level
      to a
      number of distributors around the world. We currently sell to distributors
      in
      Canada, New Zealand, Australia, Malaysia, South Africa, South Korea, Germany,
      the United Kingdom, Singapore and the United States. These distributors, in
      turn, sell our QuickVerse/Bible study packages and our Membership Plus packages
      into both Christian and large, national secular retail outlets that sell
      off-the-shelf consumer software packages, such as Best Buy, CompUSA, Circuit
      City, Office Depot and Staples. In the secular retail market, we continue to
      be
      a top seller of Bible study software and are developing additional product
      offerings and promotions to grow our market share.





On
      the
      Internet level, we are currently marketing our products through our
      www.findex.com, www.quickverse.com, and www.parsonschurch.com websites. These
      sites provide customers across the United States and around the world the
      ability to purchase our software. We anticipate Internet orders will continue
      to
      increase as we expand our software product base and enhance our marketing
      efforts in this area.





We
      are
      also marketing our products directly to the consumer through catalog, email
      and
      other direct offerings. In the past, we utilized the strength of TLC direct
      marketing and sales force. We are currently experimenting with various direct
      marketing organizations and expanding our efforts internally. We anticipate
      an
      increase during the upcoming year in our direct marketing sales initiatives.





All
      of
      our direct-to-consumer sales are currently fulfilled by us out of our warehouse
      located in Omaha, Nebraska and our boxed retail sales are fulfilled by a
      third-party fulfillment company, also located in Omaha, Nebraska.





Since
      we
      acquired the Parsons Church Division from Mattel in June 1999, we have
      experienced inconsistent growth. We expanded our presence in the CBA marketplace
      by increasing the frequency of customer contact by our sales representatives
      and
      by adding products desired by their customer base. We lost our presence in
      the
      secular retail marketplace, however, when, in March 2000, TLC announced their
      decision to reduce their workforce and their line of software products promoted
      into the secular market. Since then, though, we have not only re-established
      our
      presence in the secular retail market by focusing time, talent and resources,
      we
      have expanded that presence beyond what it had previously been.





We
      continue to aggressively pursue our objective of becoming the premier provider
      of Bible study and related products and content to the domestic and
      international markets, and to explore additional technologies, products and
      services that are complementary to the affinity group we already serve. We
      have
      developed two (2) enhanced releases of our flagship product, QuickVerse, one
      (1)
      new product targeted mainly to the secular market, QuickVerse Essentials, two
      (2) enhanced releases of our top financial and data management product,
      Membership Plus, and one (1) new financial product, Fund Accounting Plus. In
      October 2001, we released the Complete Bible Resource Library, a software
      program that contains Bible translations, Bible reference tools, multimedia
      programs, Christian clip-art images and interactive children’s games. In October
      2002, we released Fund Accounting Plus, a modular-based fund accounting software
      program designed to serve the unique accounting needs of the churches,
      para-church organizations and ministries, and non-profit entities. We are
      currently researching new opportunities in technology for our existing software
      titles and expanding our financial product line.





**RESULTS
      OF OPERATIONS**





Our
      software products have a significant seasonality to their revenues. More than
      50% of our annual sales have historically occurred in the five months of
      September through January; the five months of April through August have
      historically been the weakest generating only about 33% of our annual sales.
      Though we expect this seasonality to continue to a degree, we have seen this
      fluctuation even out through our shift in sales focus from the retail store
      and
      distributor to the end user. We continue to pursue opportunities that will
      bring
      consistency and growth to our quarterly sales efforts.




-2-




Our
      net
      income increased approximately $309,000 from a net loss of approximately
      $434,000 for the three months ended September 30, 2001 to a net loss of
      approximately $125,000 for the three months ended September 30, 2002 and
      increased approximately $4,413,000 from a net loss of approximately $3,363,000
      for the nine months ended September 30, 2001 to net income of approximately
      $1,050,000 for the nine months ended September 30, 2002. Our earnings before
      interest, taxes, depreciation, and amortization (EBITDA) increased approximately
      $364,000 from a loss of approximately $375,000 for the three months ended
      September 30, 2001 to a loss of approximately $11,000 for the three months
      ended
      September 30, 2002 and increased approximately $5,160,000 from a loss of
      approximately $3,765,000 for the nine months ended September 30, 2001 to income
      of approximately $1,395,000 for the nine months ended September 30, 2002. The
      income for the three and nine months ended September 30, 2002 includes $145,682
      in non-cash expenses related to 5,827,280 restricted common shares issued to
      employees and directors as an incentive and retention bonus program. This
      increase in our net and our EBITDA is directly attributable to changing our
      sales focus and making several cost savings decisions. We changed our focus
      to
      concentrate on upgrade sales and non-royalty sales direct to the end user.
      We
      also reduced our workforce by approximately 50% in November of 2001, closed
      our
      sales office in Cedar Rapids, Iowa, and increased our profit margin by focusing
      on the upgrade and direct sales aspect of our business. In addition, we released
      Membership Plus Deluxe, version 7 in May 2002. Finally, we recognized $2,391,000
      in bad debt expense during the three months ended September 30, 2001. We plan
      to
      continue increasing the direct sales portion of our business as a percentage
      of
      our total sales.


**Revenues**





We
      recognize software revenue net of estimated returns and allowances for returns,
      price discounts and rebates, upon shipment of product, which is when title
      passes, provided that collection of the resulting receivable is probable and
      we
      have no significant remaining obligations. Revenue from inventory out on
      consignment is recognized when the consignee sells the product. Revenue
      associated with advance payments from customers is deferred until products
      are
      shipped. Revenue for software distributed electronically via the Internet is
      recognized upon delivery.





Product
      return reserves are based upon a percentage of total retail and direct sales
      for
      the period and may increase or decrease as actual returns are processed. Product
      returns or price protection concessions that exceed our reserves could
      materially adversely affect our business and operating results and could
      increase the magnitude of quarterly fluctuations in our operating and financial
      results. Product returns from distributors and Christian bookstores are allowed
      primarily in exchange for new products or for credit towards purchases as part
      of a stock-balancing program. These returns are subject to certain limitations
      that may exist in the contract that we have with each distributor or reseller.
      Under certain circumstances, such as termination or when a product is defective,
      distributors and bookstores could receive a cash refund if returns exceed
      amounts owed. Returns from sales made directly to the consumer are accepted
      within 30 days of purchase and are issued a cash refund.





Software
      products are sold separately, without future performance such as upgrades or
      maintenance, and are sold with post contract customer support (PCS) services,
      customer service and technical support assistance. In connection with the sale
      of certain products, we provide a limited amount of free technical support
      assistance to our customers. We do not defer the recognition of revenue
      associated with sales of these products, since the cost of providing this free
      technical support is insignificant. We accrue the estimated associated costs
      of
      providing this free support upon product shipment. We also offer several plans
      under which customers are charged for technical support assistance. For plans
      where we collect fees in advance, we recognize revenue over the period of
      service, which is generally one year.





Shipping
      and handling costs in connection with our software products are expensed as
      incurred and included in cost of goods sold.





Gross
      revenues increased approximately $451,000 from $549,671 for the three months
      ended September 30, 2001 to $1,000,339 for the three months ended September
      30,
      2002, and increased approximately $570,000 from $2,646,131 for the nine months
      ended September 30, 2001 to $3,216,545 for the nine months ended September
      30,
      2002. Such increase was partially due to the company’s introduction of a new
      release of Membership Plus during the second quarter of 2002.





-3-




Historically,
      we have reproduced and distributed the Zondervan NIV Bible pursuant to a content
      licensing agreement with The Zondervan Corporation which provides that we will
      pay a royalty fee of 10% of net sales on the stand-alone product and $8.00
      per
      unit on total net units of QuickVerse. The products containing the Zondervan
      NIV
      Bible, including QuickVerse, accounted for approximately 35% of our revenues
      in
      fiscal year 2001 but none of our revenues during the three and nine months
      ended
      September 30, 2002. Due to our shortage in working capital, we are significantly
      in arrears on the royalty payments due under such licensing agreement. On April
      5, 2001, we received a notice from The Zondervan Corporation informing us that
      they were terminating our rights to the Zondervan NIV Bible under the licensing
      agreement. On October 12, 2001, Zondervan was granted a court order in the
      United States District Court in the Western District of Michigan ordering FindEx
      to cease selling, marketing and manufacturing any product that incorporates
      Zondervan’s copyrighted material. As of October 26, 2001 we reached a written
      payment agreement with Zondervan whereby they would not enforce the court order
      and we would continue to ship products containing Zondervan’s NIV Bible. We
      failed to meet our first payment obligation due to Zondervan on November 12,
      2001 in accordance with the payment agreement. On November 14, 2001, Zondervan
      pursued its enforcement rights under the court order by serving notice that
      we
      cease selling, marketing and manufacturing all products containing their
      copyrighted material. As of the date hereof, we are abiding by the court order.
      We are also involved in related court-ordered mediation in connection with
      Zondervan’s claim for $1,300,000 in unpaid royalties, which amount we are
      disputing. As of May 7, 2002, it was agreed among Zondervan, FindEx, and TLC,
      another named defendant in the proceeding, that FindEx and TLC would submit
      to
      independent audits in an effort to resolve disputed royalty amounts owed.
      Although we hope to be able to resolve this pending litigation in a way that
      will allow us to continue to sell, market and manufacture Zondervan’s
      copyrighted material, and not dramatically impair our cash flow, there can
      be no
      assurance as to our ability to achieve either of these results. Depending on
      the
      timing of, and the period over which it would be required to be paid by us,
      any
      judgment for money damages in excess of $50,000 in this proceeding would have
      a
      material adverse effect on our business, operations, financial condition and
      ability to operate as a going concern.





The
      provision for sales returns increased approximately $55,000 from $70,125 for
      the
      three months ended September 30, 2001 to $124,760 for the three months ended
      September 30, 2002, and decreased approximately $119,000 from $376,225 for
      the
      nine months ended September 30, 2001 to $257,190 for the nine months ended
      September 30, 2002. The company has experienced fewer product returns overall
      during the first nine months of 2002 than during the same period of 2001. In
      addition, we increased our direct sales efforts to the end user where our return
      policy is much shorter and incidents of product returns much lower than in
      the
      Christian and secular retail markets. We did increase our provision for the
      third quarter of 2002 to reflect an increase in shipments of boxed retail
      product associated with the Membership Plus release.





**COST
      OF SALES**




Cost
      of
      sales consists primarily of royalties to third-party providers of intellectual
      property and the direct costs and manufacturing overhead required to reproduce,
      package, fulfill and ship the software products. The direct costs and
      manufacturing overhead decreased from 20.5% of gross revenues in 2001 to 15.5%
      of gross revenues in 2002. The decrease resulted directly from the sharp
      decrease in sales of boxed, retail products. Sales direct to the end user do
      not
      require the cost of a retail box nor the additional packaging and shipping
      materials. Royalties to third party providers of intellectual property also
      decreased from 9.9% of gross revenues in 2001 to 2.7% of gross revenues in
      2002.
      The decrease in royalties reflects our focus on selling product upgrades and
      non-royalty titles. Upgrade sales, e.g. from QuickVerse version 6 to QuickVerse
      version 7, are subject to royalties only on the content additions of the
      upgraded version.


Software
      development costs, consisting primarily of direct and indirect labor and related
      overhead charges, capitalized during the three and nine months ended September
      30, 2002 were $91,509 and $185,964, respectively. Accumulated amortization
      of
      these development costs included in cost of sales totaled $13,526 and $19,907
      for the three and nine months ended September 30, 2002, respectively.





-4-




**SALES,
      GENERAL AND ADMINISTRATIVE**




Sales
      expenses increased approximately $43,000 from $159,374 for the three months
      ended September 30, 2001 to $202,383 for the three months ended September 30,
      2002 and increased approximately $134,000 from $486,630 for the nine months
      ended September 30, 2001 to $620,994 for the nine months ended September 30,
      2002. The increase is primarily due to an increase in commissions paid to the
      telemarketing firm we use for our direct sales. TLC handled direct sales almost
      entirely during the first quarter of 2001. We anticipate sales commissions
      will
      increase in future quarters as we continue to expand our direct sales efforts.
      In addition, we began providing our own technical support in April 2001
      effectively lowering the matching of future technical support costs related
      to
      sales from the current year period. Prior to that point, the company operated
      under an agreement with TLC whereby TLC provided technical support and billed
      FindEx based on the monthly number of technical support calls and emails
      received. It is anticipated that future technical support costs will remain
      lower, on a per instance basis, than that provided by TLC. We also anticipate
      that our advertising costs will increase in relation to our revenue growth.


Personnel
      costs increased approximately $16,000 from $301,872 for the three months ended
      September 30, 2001 to $317,634 for the three months ended September 30, 2002
      and
      decreased approximately $36,000 from $1,075,904 for the nine months ended
      September 30, 2001 to $1,040,213 for the nine months ended September 30, 2002
      primarily from the capitalization of direct and indirect labor and related
      overhead charges as software development costs (see `Cost of Sales’ above). As
      indicated above, personnel costs for the three and nine months ended September
      30, 2002 include $145,682 in non-cash expenses related to 5,827,280 restricted
      common shares issued to employees and directors as an incentive and retention
      bonus program. Also included in the net decrease in personnel costs for the
      nine
      months ended September 30 is a 13% increase in employee benefits. This increase
      was partially offset by changes in our benefit providers and the benefit
      packages we offer to our employees. It is anticipated that personnel costs
      will
      increase in future periods as operating capital is available to fund full
      staffing of our product development team and expansion of the technical support
      and direct marketing staff. Investor services decreased approximately $17,000
      and $255,000 for the three and nine months ended September 30, 2002,
      respectively, as compared to the same periods in the prior year, as we did
      not
      renew our investor services contract. Legal costs decreased approximately
      $32,000 and $204,000, respectively, as we dealt with fewer legal disputes during
      the three and nine months ended September 30, 2002. It is anticipated that
      legal
      costs will be higher in future quarters as we continue to work through the
      disputes with Zondervan and TLC, as well as those with Swartz.





Rent
      expense decreased approximately $7,000 during the three months ended September
      30, 2002 and approximately $19,000 during the nine months ended September 30,
      2002. This decrease is attributable to our having closed our sales office in
      Cedar Rapids, Iowa in late 2001. Rent at our corporate office location increased
      slightly over 2001. We anticipate that rent expense will continue to decrease
      as
      we have combined our product fulfillment and corporate office facilities into
      one location.





Travel
      costs decreased approximately $27,000 and $42,000 during the three and nine
      months ended September 30, 2002, respectively, compared to the same periods
      of
      the prior year. This decrease is a direct result of our staff reductions and
      shift in sales focus from the distributor to the end user.





**INCOME
      TAX BENEFITS**





Our
      effective tax rate differs from the statutory federal rate due to differences
      between income and expense recognition prescribed by the Internal Revenue Code
      and Generally Accepted Accounting Principles. We utilize different methods
      and
      useful lives for depreciating property and equipment. Amortization of the
      software license agreement is on a straight-line basis over the estimated useful
      life for financial reporting while deductible when paid for income tax purposes.
      Changes in estimates (reserves) are recognized as expense for financial
      reporting but are not deductible for income tax purposes.





We
      have
      recognized a net deferred tax asset whose realization depends on generating
      future taxable income. Because of this uncertainty, we have recorded a valuation
      allowance to offset the net deferred tax asset. The resulting deferred tax
      liability reflects income taxes payable in future periods on the net deductible
      differences related to the software license agreement. We currently have net
      operating loss carryforwards, for income tax purposes, of approximately
      $9,790,000. The carryforwards are the result of income tax losses generated
      in
      1996 ($50,000 expiring in 2011), 1997 ($77,000 expiring in 2012), 1998 ($54,000
      expiring in 2018), 2000 ($4,418,000 expiring in 2020) and 2001 ($5,191,000
      expiring in 2021). We will need to achieve a minimum annual taxable income,
      before deduction of operating loss carryforwards, of approximately $490,000
      to
      fully utilize the current loss carryforwards. We believe this is achievable
      through continued careful expense management and introduction of new products
      and enhanced Versions of our existing products. In addition, the deductions
      currently taken for license agreement payments will expire within the next
      year
      and taxable income will be greater than income for financial reporting purposes.





-5-




Management
      expects the deductible temporary differences (reserves) to reverse sometime
      beyond the next fiscal year.





**LIQUIDITY
      AND CAPITAL RESOURCES**





To
      date,
      we have funded our purchase of the Parsons Church Division primarily through
      operations. Since inception, we have raised approximately $2,250,000 in net
      proceeds from equity financings to fund acquisition and working capital needs.




As
      of
      September 30, 2002, FindEx had $899,109 in current assets, $5,180,381 in current
      liabilities and a retained deficit of $8,854,329. These factors continue to
      create an uncertainty about our ability to continue as a going concern. We
      had a
      net loss of $125,272 and net income of $1,049,479 for the three and nine months
      ended September 30, 2002, respectively.


Net
        cash
        provided by operating activities was $130,053 for the nine months ended
        September 30, 2002 and net cash used by operating activities was $61,875
        for the
        nine months ended September 30, 2001. The increase in cash provided was
        primarily due to refocusing our sales efforts on direct sales. These sales
        are
        generally credit card sales and provide a much greater profit margin. This
        increase in cash from operating activities reflects a net decrease in trade
        accounts payable of approximately $305,000. The net decrease in trade accounts
        payable includes the refinancing of $154,468 as a long-term liability.
  Net
      cash
      used by investing activities was $48,241 and $29,843 for the nine months ended
      September 30, 2002 and 2001, respectively. The increase in net cash used relates
      primarily to purchases of equipment and software.





Net
      cash
      used by financing activities was $64,547 for the nine months ended September
      30,
      2002 and net cash provided by financing activities was $72,781 for the nine
      months ended September 30, 2001. Cash used by financing activities reflects
      payments made on debt obligations and the refund of the 2000 investment of
      Thomas Ardt and Betty Wolfe. We refinanced $154,468 of trade accounts payable
      to
      Cedar Graphics, Inc. by issuing a term note payable. This refinancing has been
      reflected in the net decrease in trade accounts payable with only the principal
      reduction reflected in financing activities.





**Zondervan
      Claim**





As
      discussed above, we are currently involved in court-ordered mediation in
      connection with Zondervan’s claim for $1,300,000 in unpaid royalties, which
      amount we are disputing. Depending on the timing of, and the period over which
      it would be required to be paid by us, any judgment for money damages in excess
      of $50,000 in this proceeding would have a material adverse effect on our
      business, operations, financial condition and ability to operate as a going
      concern.





**Threatened
      Litigation by Swartz Private Equity**





On
      June
      6, 2001, we entered into an Equity Line Investment Agreement (the “Equity Line
      Agreement”) with Swartz Private Equity, LLC (“Swartz”). In accordance with its
      terms, the Equity Line Agreement entitled us to issue and sell up (“Put”) to $15
      million of our common stock to Swartz, subject to a formula based on our stock
      price and trading volume, from time to time over a three year period (the
“Equity Line”) following the effectiveness of a shelf registration statement
      that we were to have filed in connection with this transaction (the “Equity Line
      Registration Statement”).





Among
      many other terms, the Equity Line Agreement provided that if we failed to Put
      at
      least $500,000 worth of common stock to Swartz during the first year after
      the
      effective date of the Equity Line Registration Statement, and $1,000,000 during
      each one year period following thereafter, we would be required to pay Swartz
      an
      annual non-usage fee. Under the Equity Line Agreement, this non-usage fee would
      equal the difference between $100,000 and 10% of the value of the shares of
      common stock that we Put to Swartz during the one year period, and would be
      due
      and payable each year in cash within five (5) business days of the date it
      was
      accrued.





-6-




Although
      the Equity Line Agreement provided that it could be terminated by us at any
      time
      upon notice to Swartz, it also provided that, in the event of any such
      termination by us, we would be required to pay Swartz the greater of (i) the
      non-usage fee described above, or (ii) the difference between $150,000 and
      10%
      of the value of the shares of common stock Put to Swartz during all Puts to
      date
      as of that time. Further, any such termination would not affect any other
      obligations we had under either the Equity Line Agreement or any related
      agreement. Among other related agreements, this included (i) a six-year warrant
      granted to Swartz by us to purchase 510,000 shares of our common stock at $0.23
      per share, which warrant was issued as partial consideration for entering into
      the Equity Line Agreement (the “Commitment Warrant”), and (ii) a certain
      anti-dilution agreement that applied, among other things, to the Commitment
      Warrant (the “Warrant Anti-Dilution Agreement”).





On
      August
      2, 2001, and in accordance with its obligation under the Equity Line Agreement,
      we filed the Equity Line Registration Statement. Because our stock price
      collapsed shortly thereafter to a point at which any use of the Equity Line
      became prohibitively expensive in the determination of the FindEx Board (because
      the price Swartz was to pay was tied to the stock price), after a long period
      of
      waiting and hoping for a rebound or other meaningful increase in the trading
      price of our common stock, on August 26, 2002, the Registration Statement was
      officially withdrawn. That same day, notice of termination of the Equity Line
      Agreement was provided by us to Swartz. Because the Equity Line Registration
      Statement was never declared effective by the SEC, the Equity Line never became
      operative, and no amount was ever drawn by us paid thereunder.





On
      September 6, 2002, Swartz provided notice to us that it was making a demand
      under the Equity Line Agreement for the termination fee provided thereunder.
      In
      accordance with Swartz’s calculations, they were owed $150,000 payable in cash
      or common stock within 10 days of the termination. At the time of such notice,
      and had such amount been paid in common stock, it would have required 3.75
      million shares. Shortly thereafter, such claim rose to over 9 million shares.
      In
      addition, Swartz further demanded another warrant for an additional 219,127
      shares of our common stock pursuant to the Commitment Warrant and the Warrant
      Anti-Dilution Agreement. Although certain settlement discussions have ensued,
      at
      this point, the prospects for settlement seem highly uncertain. There can be
      no
      assurance that this matter will be able to be settled on terms that will not
      have a direct or indirect material adverse effect on our liquidity and financial
      condition. Further, if litigated, there can be no assurance that (i) the
      resources devoted to defending any such claim will not have a negative impact
      on
      FindEx’s ability to manage other aspects of its business, and (ii) any outcome
      thereof will not have a direct or indirect material adverse effect on our
      liquidity and financial condition.





We
      do not
      currently have adequate cash resources available to fund operations over the
      next twelve months. In order to maintain our current level of operations, we
      may
      need to secure additional funding sources to meet our operating expenses. Such
      funding sources may include, but are not limited to, private placements of
      common or convertible equities, placement of debt with banks, private or public
      investors, or other lending institutions. Although there can be no assurance,
      we
      believe that through a combination of outside sources of capital, revenues
      generated from direct-to-consumer sales and timely introduction of new product
      releases, we will have sufficient sources of capital to meet our operating
      needs. However, any substantial delays in receipt of or failure to obtain such
      capital and delays in product releases will prevent us from operating as a
      going
      concern, given our limited revenues and capital reserves.








-7-


**SIGNATURES**




In
      accordance with the requirements of the Exchange Act, the registrant caused
      this
      report to be signed on its behalf by the undersigned, thereunto duly
      authorized.





**FINDEX.COM,
                INC.**Date:
                September 29, 2005
            By
            /s/
                Steven MaloneSteven
                MalonePresident
                and Chief Executive Officer





Date:
                September 29, 2005
            By
            /s/
                Kirk R. RowlandKirk
                R. Rowland, CPAChief
                Financial Officer
















-8-