UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





(Mark
One)





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





For
the quarterly period ended September 30, 2009





OR





[_]
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 registrant as specified in its charter)








Nevada
            
            88-0379462(State
      or other jurisdiction of
            
            (I.R.S.
      Employerincorporation
      or organization)
            
            Identification
      No.)620 North 129thStreet, Omaha, Nebraska
            
            68154(Address
      of principal executive offices)
            
            (Zip
      Code)





(402)
333-1900


(Registrant’s
telephone number, including area code)





N/A





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





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.Yes [X] No
[_]





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files). Yes [X] No [_]





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act. (Check one):





Large accelerated filer [_]Accelerated
filer [_]


Non-accelerated filer [_] (Do not check if a smaller
reporting
company)                 Smaller
reporting company [X]





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





APPLICABLE
ONLY TO ISSUERS INVOLVED IN BANKRUPTCY


PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:





Indicate
by check mark whether the registrant has filed all documents and reports
required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court.  Yes [_] No
[_]





APPLICABLE
ONLY TO CORPORATE ISSUERS





Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date:





At
November 23, 2009, the registrant had outstanding 59,572,725 shares of common
stock, of which there is only a single class.








FINDEX.COM, INC.





QUARTERLY
REPORT ON FORM 10-Q


FOR
FISCAL QUARTER ENDED SEPTEMBER 30, 2009





-
INDEX -





PagePART I - FINANCIAL INFORMATION:Item 1.    Financial
      Statements:
            1Balance Sheets – September 30, 2009 (unaudited) and December
      31, 2008
            F-1Statement of Operations (unaudited) for the three and
      nine months ending September 30, 2009 and for the three and nine months
      ending September 30, 2008
            F-2Statement of Cash Flows (unaudited) for the nine months ending
      September 30, 2009 and for the nine months ending September 30,
      2008
            F-3Notes to Unaudited Financial
    Statements
            F-4Item 2.    Management's Discussion
      and Analysis of Financial Condition and Results of
      Operations
            1Item 3.    Quantitative and
      Qualitative Disclosures About Market Risk
            9Item 4T.  Controls and
    Procedures
            9PART II - OTHER INFORMATION:
            10Item
      1.    Legal Proceedings
            10Item 1A. Risk Factors
            10Item
      2.    Unregistered Sales of Equity Securities and Use
      of Proceeds
            10Item
      3.    Defaults Upon Senior
    Securities
            10Item
      4.    Submission of Matters to a Vote of Security
      Holders
            10Item
      5.    Other Information
            10Item
      6.    Exhibits
            10Signatures
            13











PART I – FINANCIAL INFORMATION





ITEM 1. FINANCIAL STATEMENTS.





Findex.com, Inc.CONDENSED
      CONSOLIDATED BALANCE SHEETS(Unaudited)September
      30, 2009
            
            
            December
      31, 2008AssetsCurrent
      assets:Cash
      and cash equivalents
            
            $
            127,341
            
            
            $
            423,371Accounts
      receivable, trade, net
            
            
            112,744
            
            
            
            148,880Inventories
            
            
            55,618
            
            
            
            81,545Other
      current assets
            
            
            43,945
            
            
            
            58,270Total
      current assets
            
            
            339,648
            
            
            
            712,066Property
      and equipment, net
            
            
            17,852
            
            
            
            37,347Intangible
      assets, net
            
            
            560,074
            
            
            
            710,771Other
      assets
            
            
            116,499
            
            
            
            155,532Total
      assets
            
            $
            1,034,073
            
            
            $
            1,615,716Liabilities
      and stockholders’ equity (deficit)Current
      liabilities:Current
      portion of debt
            
            $
            109,589
            
            
            $
            112,908Accounts
      payable, trade
            
            
            421,986
            
            
            
            496,957Accounts
      payable, related party
            
            
            84,908
            
            
            
            97,200Accrued
      royalties
            
            
            787,296
            
            
            
            720,305Accrued
      payroll
            
            
            214,609
            
            
            
            205,254Other
      current liabilities
            
            
            157,048
            
            
            
            182,937Total
      current liabilities
            
            
            1,775,436
            
            
            
            1,815,561Long-term
      debt, net
            
            
            ---
            
            
            
            8,180Deferred
      income taxes, net
            
            
            5,558
            
            
            
            7,500Commitments
      and contingencies (Note 8)Stockholders’
      equity (deficit):Preferred
      stock, $.001 par value5,000,000
      shares authorized-0-
      and -0- shares issued and outstanding, respectively
            
            
            ---
            
            
            
            ---Common
      stock, $.001 par value120,000,000
      shares authorized,59,572,725
      and 54,072,725 shares issued and outstanding, respectively
            
            
            59,573
            
            
            
            54,073Paid-in
      capital
            
            
            7,897,780
            
            
            
            7,787,779Retained
      (deficit)
            
            
            (8,704,274
            )
            
            
            (8,057,377
            )Total
      stockholders’ equity (deficit)
            
            
            (746,921
            )
            
            
            (215,525
            )Total
      liabilities and stockholders’ equity (deficit)
            
            $
            1,034,073
            
            
            $
            1,615,716See
      accompanying notes.





F-1
 Table of Contents





Findex.com, Inc.CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)Three
      Months Ended
            
            
            Nine
      Months EndedSeptember
      30,
            
            
            September
      30,2009
            
            
            2008
            
            
            2009
            
            
            2008Revenues,
      net of reserves and allowances
            
            $
            472,596
            
            
            $
            425,541
            
            
            $
            1,509,163
            
            
            $
            1,558,056Cost
      of sales
            
            
            187,695
            
            
            
            161,290
            
            
            
            544,765
            
            
            
            651,505Gross
      profit
            
            
            284,901
            
            
            
            264,251
            
            
            
            964,398
            
            
            
            906,551Operating
      expenses:Sales
      and marketing
            
            
            96,756
            
            
            
            125,695
            
            
            
            359,779
            
            
            
            467,220General
      and administrative
            
            
            253,092
            
            
            
            362,250
            
            
            
            1,233,586
            
            
            
            1,343,824Total
      operating expenses
            
            
            349,848
            
            
            
            487,945
            
            
            
            1,593,365
            
            
            
            1,811,044Loss
      from operations
            
            
            (64,947
            )
            
            
            (223,694
            )
            
            
            (628,967
            )
            
            
            (904,493
            )Other
      income (expenses), net
            
            
            (5,836
            )
            
            
            (3,247
            )
            
            
            (17,930
            )
            
            
            2,619Gain
      on fair value adjustment of derivatives
            
            
            ---
            
            
            
            ---
            
            
            
            ---
            
            
            
            305,620Gain
      on settlement of derivative liabilities
            
            
            ---
            
            
            
            ---
            
            
            
            ---
            
            
            
            450,654Loss
      before income taxes
            
            
            (70,783
            )
            
            
            (226,941
            )
            
            
            (646,897
            )
            
            
            (145,600
            )Income
      taxes
            
            
            ---
            
            
            
            ---
            
            
            
            ---
            
            
            
            ---Net
      loss
            
            $
            (70,783
            )
            
            $
            (226,941
            )
            
            $
            (646,897
            )
            
            $
            (145,600
            )Net
      loss per share - Basic & Diluted:
            
            $
            0.00
            
            
            $
            0.00
            
            
            $
            (0.01
            )
            
            $
            0.00Weighted
      average shares used in computing basic and diluted loss per
      share
            
            
            59,572,725
            
            
            
            54,072,725
            
            
            
            58,122,176
            
            
            
            53,553,381See
      accompanying notes.





F-2
 Table of Contents





Findex.com, Inc.CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)Nine
      Months Ended September 30,
            
            
            2009
            
            
            
            2008Cash
      flows from operating activities:Cash
      received from customers
            
            $
            1,507,621
            
            
            $
            1,674,610Cash
      paid to suppliers and employees
            
            
            (1,543,286
            )
            
            
            (1,832,408
            )Other
      operating activities, net
            
            
            (11,851
            )
            
            
            11,149Net
      cash used by operating activities
            
            
            (47,516
            )
            
            
            (146,649
            )Cash
      flows from investing activities:Software
      development costs
            
            
            (204,317
            )
            
            
            (201,073
            )FormTool
      purchase
            
            
            ---
            
            
            
            (100,000
            )Other
      investing activities, net
            
            
            7,624
            
            
            
            (77,335
            )Net
      cash used by investing activities
            
            
            (196,693
            )
            
            
            (378,408
            )Cash
      flows from financing activities:Payment
      made for settlement of derivative liabilities
            
            
            ---
            
            
            
            (150,000
            )Payments
      made on term debt
            
            
            (51,821
            )
            
            
            (26,722
            )Net
      cash used by financing activities
            
            
            (51,821
            )
            
            
            (176,722
            )Net
      decrease in cash and cash equivalents
            
            
            (296,030
            )
            
            
            (701,779
            )Cash
      and cash equivalents, beginning of year
            
            
            423,371
            
            
            
            1,134,547Cash
      and cash equivalents, end of period
            
            $
            127,341
            
            
            $
            432,768Reconciliation
      of net loss to cash flows from operating activities:Net
      loss
            
            $
            (646,897
            )
            
            $
            (145,600
            )Adjustments
      to reconcile net income (loss) to net cash used
      by operating activities:Software
      development costs amortized
            
            
            132,853
            
            
            
            192,433Depreciation
      & amortization
            
            
            273,584
            
            
            
            343,178Bad
      debts provision
            
            
            7,398
            
            
            
            3,212Noncash
      operating expenses
            
            
            70,500
            
            
            
            34,521Gain
      on fair value adjustment of derivatives
            
            
            ---
            
            
            
            (305,620
            )Gain
      on settlement of derivative liabilities
            
            
            ---
            
            
            
            (450,654
            )Gain
      on sale of property and equipment
            
            
            (520
            )
            
            
            ---Change
      in assets and liabilities:Decrease
      in accounts receivable
            
            
            28,738
            
            
            
            152,741Decrease
      in inventories
            
            
            25,927
            
            
            
            21,786Decrease
      in other current assets
            
            
            28,596
            
            
            
            62,509Increase
      in accrued royalties
            
            
            66,991
            
            
            
            74,445(Decrease)
      increase in accounts payable
            
            
            (63,151
            )
            
            
            127Increase
      (decrease) in other liabilities
            
            
            28,465
            
            
            
            (129,727
            )Net
      cash used by operating activities
            
            $
            (47,516
            )
            
            $
            (146,649
            )Schedule
      of Noncash Investing and Financing Activities:Long-term
      note payable issued for FormTool purchase
            
            $
            ---
            
            
            $
            85,934Equity
      issued for FormTool purchase
            
            $
            ---
            
            
            $
            40,000See
      accompanying notes.





F-3
 Table of Contents


Findex.com, Inc.


Notes
to Condensed Consolidated Financial Statements


September
30, 2009


(Unaudited)





NOTE
1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





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-Q and Article 8 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by Generally Accepted Accounting Principles for complete
financial statements. 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 year or for any future period. The December 31, 2008
condensed consolidated balance sheet was derived from our audited financial
statements at that date.  The accompanying financial statements should
be read in conjunction with the audited consolidated financial statements of
Findex.com, Inc. included in our Form 10-K for the year ended December 31,
2008.





USE
OF ESTIMATES





The
preparation of consolidated financial statements in conformity with Generally
Accepted Accounting Principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and the
accompanying notes. Significant estimates used in the consolidated financial
statements include the estimates of (i) doubtful accounts, obsolete inventory,
sales returns, price protection and rebates, (ii) provision for income taxes and
realizability of the deferred tax assets, and (iii) the life and realization of
identifiable intangible assets. The amounts we will ultimately incur or recover
could differ materially from current estimates.





INVENTORY





Inventory,
including out on consignment, consists primarily of software media, manuals and
related packaging materials and is recorded at the lower of cost or market
value, determined on a first-in, first-out, and adjusted on a per-item,
basis.





ACCOUNTING
FOR LONG-LIVED ASSETS





We review
property and equipment and intangible assets for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable. Recoverability is measured by comparison of our carrying amount
to future net cash flows the assets are expected to generate. If such assets are
considered to be impaired, the impairment to be recognized is measured by the
amount by which the carrying amount of the asset exceeds its fair market value.
Property and equipment to be disposed of are reported at the lower of the
carrying amount or fair value less costs to sell.





INTANGIBLE
ASSETS





In
accordance with Financial Accounting Standards Board Accounting Standards
Codification (“ASC”) 350-30, General Intangibles Other Than
Goodwill, intangible assets with an indefinite useful life are not
amortized. Intangible assets with a finite useful life are amortized on the
straight-line method over the estimated useful lives, generally three to ten
years.





F-4
 Table of Contents


SOFTWARE
DEVELOPMENT COSTS





In
accordance with ASC 985-20-25, Costs of Software to Be Sold,
Leased, or Marketed, software development costs are expensed as incurred
until technological feasibility and marketability has been established,
generally with release of a beta version for customer testing. Once the point of
technological feasibility and marketability is reached, direct production costs
(including labor directly associated with the development projects), indirect
costs (including allocated fringe benefits, payroll taxes, facilities costs, and
management supervision), and other direct costs (including costs of outside
consultants, purchased software to be included in the software product being
developed, travel expenses, material and supplies, and other direct costs) are
capitalized until the product is available for general release to customers. We
amortize capitalized costs on a product-by-product basis. Amortization for each
period is the greater of the amount computed using (i) the straight-line basis
over the estimated product life (generally from 12 to 18 months, but up to 60
months), or (ii) the ratio of current revenues to total projected product
revenues. Total cumulative capitalized software development costs were
$1,042,928, less accumulated amortization of $641,446 at September 30,
2009.





Capitalized
software development costs are stated at the lower of amortized costs or net
realizable value. Recoverability of these capitalized costs is determined at
each balance sheet date by comparing the forecasted future revenues from the
related products, based on management’s best estimates using appropriate
assumptions and projections at the time, to the carrying amount of the
capitalized software development costs. If the carrying value is determined not
to be recoverable from future revenues, an impairment loss is recognized equal
to the amount by which the carrying amount exceeds the future revenues. To date,
no capitalized costs have been written down to net realizable
value.





ASC 730,
Research and
Development, established accounting and reporting standards for research
and development. In accordance with ASC 730-10, costs we incur to enhance our
existing products after general release to the public (bug fixes) are expensed
in the period they are incurred and included in research and development costs.
Research and development costs incurred prior to determination of technological
feasibility and marketability and after general release to the public and
charged to expense were $125,234 and $143,147 for the nine months ended
September 30, 2009 and 2008, respectively, included in general and
administrative expenses.





We
capitalize costs related to the development of computer software developed or
obtained for internal use in accordance with the ASC 350-40, Internal-Use Software.
Software obtained for internal use has generally been enterprise level business
and finance software that we customize to meet our specific operational needs.
We have not sold, leased, or licensed software developed for internal use to our
customers and have no intention of doing so in the future.





We
capitalize costs related to the development and maintenance of our website in
accordance with ASC 350-50, Website Development Costs.
Accordingly, costs expensed as incurred are as follows:





▪
            planning
      the website,▪
            developing
      the applications and infrastructure until technological feasibility is
      established,▪
            developing
      graphics such as borders, background and text colors, fonts, frames, and
      buttons, and▪
            operating
      the site such as training, administration and
  maintenance.





Capitalized
costs include those incurred to:





▪
            obtain
      and register an Internet domain name,▪
            develop
      or acquire software tools necessary for the development
    work,▪
            develop
      or acquire software necessary for general website
    operations,▪
            develop
      or acquire code for web applications,▪
            develop
      or acquire (and customize) database software and software to integrate
      applications such as corporate databases and accounting systems into web
      applications,▪
            develop
      HTML web pages or templates,▪
            install
      developed applications on the web server,▪
            create
      initial hypertext links to other websites or other locations within the
      website, and▪
            test
      the website applications.





F-5
 Table of Contents


We
amortize website development costs on a straight-line basis over the estimated
life of the site, generally 36 months. Total cumulative website development
costs, included in “Other assets” on our condensed consolidated balance sheets,
were $144,109, less accumulated amortization of $46,769 at September 30,
2009.





RESTRICTED
CASH





Restricted
cash represents cash held in reserve by our merchant banker to allow for a
potential increase in credit card charge backs from increased consumer
purchases.  Total restricted cash at September 30, 2009 included in
“Other assets” on the condensed consolidated balance sheets was
$8,000.





REVENUE
RECOGNITION





We derive
revenues from the sale of packaged software products, product support and
multiple element arrangements that may include any combination of these items.
We recognize software revenue for software products and related services in
accordance with ASC 985-605, Software Revenue Recognition.
We recognize revenue when persuasive evidence of an arrangement exists
(generally a purchase order), we have delivered the product, the fee is fixed or
determinable and collectibility is probable.





In some
situations, we receive advance payments from our customers. We defer revenue
associated with these advance payments until we ship the products or offer the
support.





In
accordance with ASC 605-50, Customer Payments and
Incentives, we account for cash considerations (such as sales incentives
– rebates and coupons) that we give to our customers as a reduction of revenue
rather than as an operating expense.





Product
Revenue





We
typically recognize revenue from the sale of our packaged software products when
we ship the product. We sell some of our products on consignment to a limited
number of resellers. We recognize revenue for these consignment transactions
only when the end-user sale has occurred. Revenue for software distributed
electronically via the Internet is recognized when the customer has been
provided with the access codes that allow the customer to take immediate
possession of the software on its hardware and evidence of the arrangement
exists (web order).





Some of
our software arrangements involve multiple copies or licenses of the same
program. These arrangements generally specify the number of simultaneous users
the customer may have (multi-user license), or may allow the customer to use as
many copies on as many computers as it chooses (a site license). Multi-user
arrangements, generally sold in networked environments, contain fees that vary
based on the number of users that may utilize the software simultaneously. We
recognize revenue when evidence of an order exists and upon delivery of the
authorization code to the consumer that will allow them the limited simultaneous
access. Site licenses, generally sold in non-networked environments, contain a
fixed fee that is not dependent on the number of simultaneous users. Revenue is
recognized when evidence of an order exists and the first copy is delivered to
the consumer.





Many of
our software products contain additional content that is “locked” to prevent
access until a permanent access code, or “key,” is purchased. We recognize
revenue when evidence of an order exists and the customer has been provided with
the access code that allows the customer immediate access to the additional
content. All of the programs containing additional locked content are fully
functional and the keys are necessary only to access the additional content. The
customer’s obligation to pay for the software is not contingent on delivery of
the “key” to access the additional content.





We reduce
product revenue for estimated returns and price protections that are based on
historical experience and other factors such as the volume and price mix of
products in the retail channel, trends in retailer inventory and economic trends
that might impact customer demand for our products. We also reduce product
revenue for the estimated redemption of end-user rebates on certain current
product sales. Our rebate reserves are estimated based on the terms and
conditions of the specific promotional rebate program, actual sales during the
promotion, the amount of redemptions received and historical redemption trends
by product and by type of promotional program. We did not offer any rebate
programs to our customers during the three and nine months ended September 30,
2009 and 2008.





F-6
 Table of Contents


Multiple
Element Arrangements





We also
enter into certain revenue arrangements for which we are obligated to deliver
multiple products or products and services (multiple elements). For these
arrangements, which include software products, we allocate and defer revenue for
the undelivered elements based on their vendor-specific objective evidence
(“VSOE”) of fair value. VSOE is generally the price charged when that element is
sold separately.





In
situations where VSOE exists for all elements (delivered and undelivered), we
allocate the total revenue to be earned under the arrangement among the various
elements, based on their relative fair value. For transactions where VSOE exists
only for the undelivered elements, we defer the full fair value of the
undelivered elements and recognize the difference between the total arrangement
fee and the amount deferred for the undelivered items as revenue (residual
method). If VSOE does not exist for undelivered items that are services, we
recognize the entire arrangement fee ratably over the remaining service period.
If VSOE does not exist for undelivered elements that are specified products, we
defer revenue until the earlier of the delivery of all elements or the point at
which we determine VSOE for these undelivered elements.





We
recognize revenue related to the delivered products or services only if (i) the
above revenue recognition criteria are met, (ii) any undelivered products or
services are not essential to the functionality of the delivered products and
services, (iii) payment for the delivered products or services is not contingent
upon delivery of the remaining products or services, and (iv) we have an
enforceable claim to receive the amount due in the event that we do not deliver
the undelivered products or services.





Discounts
on Future Purchases





In
connection with the licensing of an existing product, we sometimes offer a
discount on additional licenses of the same product or on other
products.  We apply a proportionate amount of the discount to each
element covered by the arrangement based on each element’s fair
value.  If the future elements are unknown at the time of the original
sale, we apply the discount to the current product(s) purchased, defer the
discount amount to be recognized pro rata over the estimated period during which
additional purchases will be made (typically one year), and recognize current
revenue on the remainder.





Shipping
and Handling Costs





We record
the amounts we charge our customers for the shipping and handling of our
software products as product revenue and we record the related costs as cost of
sales on our condensed consolidated statements of operations.





Sales
Taxes





We record
the amounts we charge our customers for sales taxes assessed by state and local
governments on the sale of our software products and related shipping charges,
as appropriate, on the net basis.  As such, we report the taxes
collected as a liability on our balance sheet and do not include them in product
revenue in our consolidated statements of operations.





Customer
Service and Technical Support





Customer
service and technical support costs include the costs associated with performing
order processing, answering customer inquiries by telephone and through
websites, email and other electronic means, and providing technical support
assistance to our customers. In connection with the sale of certain products, we
provide a limited amount of free technical support assistance to customers. We
do not defer the recognition of any revenue associated with sales of these
products, since the cost of providing this free technical support is
insignificant. The technical support is provided within one year after the
associated revenue is recognized and free product enhancements (bug fixes) are
minimal and infrequent. We accrue the estimated cost of providing this free
support upon product shipment and include it in cost of sales.





F-7
 Table of Contents


INCOME
TAXES





We follow
the guidance of ASC 740, Income Taxes. Accordingly we
use the asset and liability method of accounting for income taxes. Under this
method, deferred income taxes are provided for the temporary differences between
the financial reporting basis and the tax basis of our assets and liabilities.
Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled.





EARNINGS
PER SHARE





We follow
the guidance of ASC 260, Earnings Per Share, to
calculate and report basic and diluted earnings per share (“EPS”). Basic EPS is
computed by dividing income available to common shareholders by the weighted
average number of shares of common stock outstanding for the period. Diluted EPS
is computed by giving effect to all dilutive potential shares of common stock
that were outstanding during the period. For us, dilutive potential shares of
common stock consist of the incremental shares of common stock issuable upon the
exercise of stock options and warrants for all periods, convertible notes
payable and the incremental shares of common stock issuable upon the conversion
of convertible preferred stock.





When
discontinued operations, extraordinary items, and/or the cumulative effect of an
accounting change are present, income before any of such items on a per share
basis represents the “control number” in determining whether potential shares of
common stock are dilutive or anti-dilutive. Thus, the same number of potential
shares of common stock used in computing diluted EPS for income from continuing
operations is used in calculating all other reported diluted EPS amounts. In the
case of a net loss, it is assumed that no incremental shares would be issued
because they would be anti-dilutive. In addition, certain options and warrants
are considered anti-dilutive because the exercise prices were above the average
market price during the period. Anti-dilutive shares are not included in the
computation of diluted EPS, in accordance with ASC 260-10-45-17.





The
following table shows the amounts used in computing earnings per common share
and the average number of shares of dilutive potential common
stock:





For
      the Three Months Ended September 30,
            
            2009
            
            
            2008Net
      loss
            
            $
            (70,783
            )
            
            $
            (226,941
            )Preferred
      stock dividends
            
            
            ---
            
            
            
            ---Net
      loss available to common shareholders
            
            $
            (70,783
            )
            
            $
            (226,941
            )Basic
      weighted average shares outstanding
            
            
            59,572,725
            
            
            
            54,072,725Dilutive
      effect of:Stock
      options
            
            
            ---
            
            
            
            ---Warrants
            
            
            ---
            
            
            
            ---Diluted
      weighted average shares outstanding
            
            
            59,572,725
            
            
            
            54,072,725





For
      the Nine Months Ended September 30,
            
            2009
            
            
            2008Net
      loss
            
            $
            (646,897
            )
            
            $
            (145,600
            )Preferred
      stock dividends
            
            
            ---
            
            
            
            ---Net
      loss available to common shareholders
            
            $
            (646,897
            )
            
            $
            (145,600
            )Basic
      weighted average shares outstanding
            
            
            58,122,176
            
            
            
            53,553,381Dilutive
      effect of:Stock
      options
            
            
            ---
            
            
            
            ---Warrants
            
            
            ---
            
            
            
            ---Diluted
      weighted average shares outstanding
            
            
            58,122,176
            
            
            
            53,553,381





F-8
 Table of Contents


RECENT
ACCOUNTING PRONOUNCEMENTS





Certain
Arrangements That Contain Software Elements





In
September 2009, the EITF reached final consensus on a new revenue recognition
standard, Issue No. 09-3, Applicability of AICPA Statement of
Position 97-2 to Certain Arrangements That Contain Software
Elements.  EITF 09-3 amends the scope of AICPA Statement of
Position 97-2, Software
Revenue Recognition (now codified as ASC 985, Revenue Recognition) to
exclude tangible products that include software and non-software components that
function together to deliver the product’s essential
functionality.  This issue shall be applied on a prospective basis for
revenue arrangements entered into or materially modified in fiscal years
beginning on or after June 15, 2010.  Earlier application is permitted
as of the beginning of a company’s fiscal year provided the company has not
previously issued financial statements for any period within that
year.  Early application is not permitted unless early application of
EITF 08-1 is also adopted.  We are currently evaluating the potential
impact of EITF 09-3 on our condensed consolidated financial
statements.





Revenue
Arrangements with Multiple Deliverables





In
September 2009, the EITF reached final consensus on a new revenue recognition
standard, Issue No. 08-1, Revenue Arrangements with Multiple
Deliverables.  EITF 08-1 addresses how to determine whether an
arrangement involving multiple deliverables contains more than one unit of
accounting, and how the arrangement consideration should be allocated among the
separate units of accounting.  EITF 08-1 is effective for fiscal years
beginning after June 15, 2010 and may be applied retrospectively or
prospectively for new or materially modified arrangements.  In
addition, early adoption is permitted.  We are currently evaluating
the potential impact of EITF 08-1 on our condensed consolidated financial
statements.





Accounting
Standards Codification and GAAP Hierarchy





In June
2009, the FASB issued Update No. 2009-01, which established the FASB Accounting
Standards CodificationTM
(“the Codification”) as the source of authoritative U.S. Generally Accepted
Accounting Principles (“GAAP”) recognized by the FASB to be applied by
nongovernmental entities. The Codification is effective for financial statements
issued for interim and annual periods ending after September 15, 2009. The
adoption of the Codification did not have a material impact on our condensed
consolidated financial statements.





Amendment
to FASB Interpretation No. 46(R)





In June
2009, the FASB issued SFAS No. 167, Amendments to FASB Interpretation
No. 46(R),to clarify and improve financial reporting by entities
involved with variable interest entities. SFAS No. 167 is effective as of the
beginning of the annual period that begins after November 15, 2009, for interim
periods within that first annual reporting period, and for interim and annual
reporting periods thereafter. We do not expect SFAS No. 167 to have a material
impact on our condensed consolidated financial statements.





Transfers
of Financial Assets





In June
2009, the FASB issued SFAS No. 166, Accounting for Transfers of
Financial Assets – an amendment of FASB Statement No. 140,to clarify
information that an entity must provide in its financial statements surrounding
a transfer of financial assets and the effect of the transfer on its financial
position, financial performance, and cash flows.  SFAS No. 166 is
effective as of the beginning of the annual period that begins after November
15, 2009, for interim periods within that first annual reporting period, and for
interim and annual reporting periods thereafter. We do not expect SFAS No. 166
to have a material impact on our condensed consolidated financial
statements.





Subsequent
Events





In May
2009, the FASB issued SFAS No. 165, Subsequent Events, (now
codified as ASC 855, Subsequent Events) to
establish general standards of accounting for and disclosures of events that
occur after the balance sheet date but before financial statements are issued or
available to be issued.  The guidance is effective for interim or
annual financial periods ending after June 15, 2009. Adoption of this
authoritative guidance did not have a material impact on our condensed
consolidated financial statements.





F-9
 Table of Contents


RECLASSIFICATIONS





Certain
accounts in our 2008 financial statements have been reclassified for comparative
purposes to conform with the presentation in our 2009 financial
statements.





NOTE
2 – GOING CONCERN





The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with Generally Accepted Accounting Principles in the
United States applicable to a going concern. As of September 30, 2009, we had a
year-to-date net loss of $646,897, and negative working capital of $1,435,788,
and an accumulated deficit of $8,704,274 and $8,057,377 as of September 30, 2009
and December 31, 2008, respectively. Although these factors raise substantial
doubt as to our ability to continue as a going concern through December 31,
2009, we have taken several actions intended to mitigate against this risk.
These actions include relying on the approximately $127,000 cash reserve from
the 2007 sale of our Membership Plus product line and pursuing mergers and
acquisitions that will provide profitable operations and positive operating cash
flow.





NOTE
3 – INVENTORIES





At
September 30, 2009, inventories consisted of the following:





Raw
      materials
            
            $
            54,889Finished
      goods
            
            
            16,763Less
      reserve for obsolete inventory
            
            
            (16,034
            )Inventories
            
            $
            55,618





NOTE
4 – PRODUCT LINE ACQUISITION





On
February 25, 2008, we acquired the FormTool software product line from ORG
Professional, LLC.  The purchase price of approximately $226,000 was
comprised as follows:





Description
            
            AmountFair
      value of common stock
            
            $
            40,000Cash
            
            
            100,000Promissory
      note
            
            
            85,934Total
            
            $
            225,934





The fair
value of our common stock was determined based on 1,000,000 restricted shares of
our common stock issued and priced at the closing price as of February 22, 2008
($0.04).





The
allocation of the purchase price to the assets acquired based on their estimated
fair values was as follows:





Description
            
            AmountTrademark/Trade
      name
            
            $
            67,780Internet
      domain names
            
            
            33,890Customer
      list
            
            
            22,594Copyrights
            
            
            67,780Computer
      software code
            
            
            22,594Distribution
      agreements
            
            
            11,296Total
            
            $
            225,934





F-10
 Table of Contents


The
assets will be amortized over a period of years as follows:





Description
            
            Estimated
      Remaining Life (years)Trademark/Trade
      name/Copyrights
            
            10Internet
      domain names
            
            5Customer
      list/Computer software code
            
            3Distribution
      agreements (remaining contract term)
            
            .33





One of
our outside directors currently owns a 5% equity interest in ORG Professional,
LLC, and agreed to forego any direct personal economic benefit to which he would
otherwise be entitled, including the restricted shares of our common stock
issuable as part of the consideration.





During
the three months ended September 30, 2009 and 2008, sales from the FormTool
software product line were approximately 3% and 5%, respectively, of our gross
sales and approximately 4% and 2%, respectively, for the nine months then
ended.





NOTE
5 – RESERVES AND ALLOWANCES





At
September 30, 2009, the allowance for doubtful accounts included in Accounts
receivable, trade, net, consisted of the following:





Balance
      December 31, 2008
            
            $
            16,300Bad
      debts provision (included in Other operating expenses)
            
            
            7,398Accounts
      written off
            
            
            (9,061
            )Collection
      of accounts previously written off
            
            
            1,233Balance
      September 30, 2009
            
            $
            15,870





At
September 30, 2009, the reserve for obsolete inventory included in Inventories
consisted of the following:





Balance
      December 31, 2008
            
            $
            15,500Provision
      for obsolete inventory
            
            
            7,096Obsolete
      inventory written off
            
            
            (6,562
            )Balance
      September 30, 2009
            
            $
            16,034





At
September 30, 2009, the reserve for sales returns included in Other current
liabilities consisted of the following:





Balance
      December 31, 2008
            
            $
            119,821Return
      provision – sales
            
            
            168,300Return
      provision – cost of sales
            
            
            (25,245
            )Returns
      processed
            
            
            (175,334
            )Balance
      September 30, 2009
            
            $
            87,542





NOTE
6 – DEBT





At
September 30, 2009, the current portion of debt consisted of the
following:





Unsecured
      term note payable to a premium finance company due April 2010 in monthly
      installments of $1,664, including interest at 5.73%.
            
            $
            11,428Unsecured
      term note payable to a vendor for advertising due July 2010 in monthly
      installments of $2,000, including interest at 10%.
            
            
            18,721Total
      short-term notes payable
            
            
            30,149Add:  Current
      maturities of long-term debt
            
            
            79,440Current
      portion of debt
            
            $
            109,589





F-11
 Table of Contents


At
September 30, 2009, long-term debt consisted of the following:





Capital
      lease obligation payable to a corporation due November 2009 in monthly
      installments of $1,144, including interest at 11.7%. Secured by telephone
      equipment.
            
            $
            3,366Unsecured
      term note payable to a shareholder due March 2008 in monthly installments
      of $10,000, plus interest at 8%, through April 2007, and monthly
      installments of $20,000, plus interest at 8%, beginning May 2007. Interest
      on overdue principal accrues at 15%.
            
            
            56,000Unsecured
      term note payable to a limited liability company due February 2010 in
      monthly installments of $4,167, including simple interest at 15%. See Note
      4.
            
            
            20,074Total
      Long-term debt
            
            
            79,440Less:  Current
      maturities
            
            
            (79,440
            )Long-term
      debt, net
            
            $
            ---





At
September 30, 2009, we were current on the unsecured term notes payable to the
premium finance company, the advertising vendor, and the limited liability
company.  We were in arrears for the final three payments of the
unsecured term note payable to a shareholder and the September 2009 installment
of the capital lease obligation.





NOTE
7 – STOCKHOLDERS’ EQUITY





COMMON
STOCK





In March
2009, we committed to issue a total of 3,357,143 restricted shares of common
stock consisting of 1,907,143 shares to our executive officers and 1,450,000
shares to our non-executive employees, at the closing price as of March 12, 2009
($0.021), in lieu of cash for services rendered from January 1, 2004 through
December 31, 2008.  This issuance was valued at $70,500.





In March
2009, we committed to issue a total of 2,142,857 restricted shares of common
stock to our outside directors, at the closing price as of March 12, 2009
($0.021) in lieu of cash payments of amounts accrued for service as members of
our board from the period of April 1, 2008 through December 31,
2008.  This issuance was valued at $45,000.





NOTE
8 – COMMITMENTS AND CONTINGENCIES





We are
subject to legal proceedings and claims that may arise in the ordinary course of
our business. In the opinion of management, the amount of ultimate liability
with respect to these potential actions will not materially affect our financial
statements taken as a whole.





Our
employment agreements with our management team each contain a provision for an
annual bonus equal to 1% of our income from operations adjusted for other income
and interest expense (3% total). We accrue this bonus on a quarterly basis ($-0-
at September 30, 2009). Our management team consists of the
following:





Chief
      Executive Officer
            
            
            Chief
      Technology Officer
            
            
            Chief
      Financial OfficerBase
      Annual Salary
            
            $
            150,000
            
            
            $
            150,000
            
            
            $
            110,000





F-12
 Table of Contents


In
addition to the bonus provisions and annual base salary, each employment
agreement provides for payment of the following for termination by reason of
disability.





Accrued
      Base Salary
            
            
            Accrued
      Retention Bonus
            
            
            Vested
      Deferred Vacation CompensationIncluded
      in Other current liabilities at September 30, 2009
            
            $
            13,796
            
            
            $
            30,056
            
            
            $
            23,838





The
agreements also provide for severance compensation equal to the then base salary
until the later of (i) the expiration of the term of the agreement as set forth
therein or (ii) one year, when the termination is other than for cause
(including termination by reason of disability). There is no severance
compensation in the event of voluntary termination or termination for
cause.





We have
included content in QuickVerse, our flagship software product, under contracts
with publisher providers that have expired.  We are currently pursuing
resolution, however, there is no guarantee that we will be able to secure a new
agreement, or an extension, and should any of the publishers demand we cease and
desist including their content, the unknown potential negative impact could be
material.





Our
royalty agreements for new content generally provide for advance payments to be
made upon contract signing.  In addition, several new agreements
provide for additional advance payments to be made upon delivery of usable
content and publication.  We accrue and pay these advances when the
respective milestone is met.





We do not
collect sales taxes or other taxes with respect to shipments of most of our
goods into most states in the U.S.  Our fulfillment center and
customer service center networks, and any future expansion of those networks,
along with other aspects of our evolving business, may result in additional
sales and other tax obligations.  One or more states may seek to
impose sales or other tax collection obligations on out-of-jurisdiction
companies that engage in e-commerce.  A successful assertion by one or
more states that we should collect sales or other taxes on the sale of
merchandise or services could result in substantial tax liabilities for past
sales, decrease our ability to compete with traditional retailers, and otherwise
harm our business.





Currently,
decisions of the U.S. Supreme Court restrict the imposition of obligations to
collect state and local taxes and use taxes with respect to sales made over the
Internet.  However, a number of states, as well as the U.S. Congress,
have been considering various initiatives that could limit or supersede the
Supreme Court’s constitutional concerns and result in a reversal of its current
position. As a result, we could be required to collect sales and use taxes in
additional states.  The imposition by state and local governments of
various taxes upon Internet commerce could create administrative burdens for us,
put us at a competitive disadvantage if they do not impose similar obligations
on all of our online competitors and decrease our future sales.





NOTE
9 – RISKS AND UNCERTAINTIES





Our
future operating results may be affected by a number of factors. We depend upon
a number of major inventory and intellectual property suppliers. If a critical
supplier had operational problems or ceased making materials available to us,
operations could be adversely affected.

















F-13
 Table of Contents


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





Cautionary
Statement Regarding Forward-Looking Statements





Certain
statements made in this Quarterly Report on Form 10-Q are “forward-looking
statements” (within the meaning of the Private Securities Litigation Reform Act
of 1995) regarding the plans and objectives of management for future operations.
Such statements involve known and unknown risks, uncertainties and other factors
that may cause actual results, performance or achievements of Findex.com, Inc.
(“we”, “us”, “our” or the “Company”) to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.  The forward-looking statements included
herein are based on current expectations that involve numerous risks and
uncertainties. The Company's plans and objectives are based, in part, on
assumptions involving the continued expansion of
business.  Assumptions relating to the foregoing involve judgments
with respect to, among other things, future economic, competitive and market
conditions and future business decisions, all of which are difficult or
impossible to predict accurately and many of which are beyond the control of the
Company.  Although the Company believes its assumptions underlying the
forward-looking statements are reasonable, any of the assumptions could prove
inaccurate and, therefore, there can be no assurance the forward-looking
statements included in this Quarterly Report will prove to be
accurate.  In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the objectives and plans of the Company will be achieved.





This
information should be read in conjunction with our unaudited condensed
consolidated financial statements and the notes thereto included in Item 1 of
Part I of this quarterly report, and our audited financial statements and the
notes thereto and our Management’s Discussion and Analysis of Financial
Condition and Results of Operation contained in our annual report on Form 10-K
for the fiscal year ended December 31, 2008.





Description
of Business





We
develop, publish, market, and distribute and directly sell off-the-shelf
consumer and organizational software products for PC, Macintosh®
and PDA platforms. We develop our software products through in-house initiatives
supplemented by outside developers. We market and distribute our software
products principally through direct marketing and Internet sales programs, but
also through secular and non-secular wholesale retailers.





We are
currently in the early stages of a defining transformative period in our
development. In recent years, we have come to be recognized as a consumer
desktop software company that serves a demographic defined largely by an
interest in Christianity and faith-based “inspirational” values. The nature of
our products historically, and the fact that our product lines have not extended
materially beyond the boundaries of this affinity group, have fostered this
perception. Indeed, as the publisher of one of the industry-leading Bible study
desktop software products, QuickVerse®,
we are known to many users of that product only as “QuickVerse”, not Findex.
While we believe that the QuickVerse®
brand is among our most valuable assets, and we greatly value the goodwill that
our reputation in this regard has engendered, we also believe that working to
expand that reputation into one which is more closely associated with providing
high quality branded software and content products generally – and ones that
extend across both consumer and business segments – will afford us significantly
greater opportunities in both the near and long term to steadily increase
revenues and earnings, and, ultimately, to enhance shareholder value. We
believe, moreover, that coupling this strategic diversification with a
commitment to an increasing reliance on a sales and distribution model through
which our products are sold on a subscription basis and can be purchased and
downloaded directly from us online will be instrumental in furthering these
financial objectives. Consequently, while we expect to continue for the
indefinite future to invest substantially in the growth and development of our
existing primary software titles and content, we also expect as we go forward to
invest substantially in not only building a significantly more diverse line of
product titles, but also in building our technology platform and infrastructure
so as to enable our evolution over time into a principally Webcentric provider
of software solutions, content, and online products.





As part
of that objective, we acquired FormTool.com and the FormTool®
line of products in February 2008.  In September 2008, we re-launched
the FormTool.com website as an online marketplace for purchasing the
FormTool®
line of form creation and form filler products, and also a one-stop shop for
finding, purchasing and downloading customizable forms for a wide range of
business and consumer needs. Our model includes the ability to purchase forms on
an individual basis, in bulk packs, or on a subscription basis.





-1-
 Table of Contents


Management
Overview





During
the nine months ended September 30, 2009, we focused on our two product lines,
QuickVerse®
and FormTool®,
and their individual technological features.  We also continued to
concentrate on building our technology platform and infrastructure in order to
become a more Webcentric provider of online products.





QuickVerse®





Our
development team worked on several projects during the nine months ended
September 30, 2009, which resulted in the release of two upgraded software
programs as well as two new content collections for our QuickVerse®
product line. These titles include:





▪
            QuickVerse®
      Macintosh 3.0 with retail prices ranging from $59.95 to
      $349.95;▪
            Early
      Church Fathers Collection with a retail price of
  $149.95;▪
            Sermon
      Builder 5.0 with a retail price of $69.95; and▪
            Charles
      H. Spurgeon Collection with a retail price of
  $69.95.





Furthermore,
our development team finalized a new edition to our quickverse.com website,
referred to as our QuickVerse®
Knowledgebase. The QuickVerse®
Knowledgebase enables users to quickly find and navigate through multiple
troubleshooting scenarios online rather than having to call or email our
technical support department.  Finally, our development team focused
on our upcoming annual release of QuickVerse®
for Windows, which was released in October 2009.





FormTool®





During
the nine months ended September 30, 2009, we began revamping our website for our
FormTool®
product line in order to add greater functionality to the
website.  Although there can be no assurance, this revamped website is
scheduled to be launched in the fourth quarter of 2009.





Results of Operations for Nine Months Ending
September 30, 2009 and September 30, 2008





Statements
      of Operations for Nine Months Ending September 30
            
            2009
            
            
            2008
            
            
            ChangeNet
      revenues
            
            $
            1,509,163
            
            
            $
            1,558,056
            
            
            $
            (48,893
            )Cost
      of sales
            
            
            (544,765
            )
            
            
            (651,505
            )
            
            
            106,740Gross
      profit
            
            $
            964,398
            
            
            $
            906,551
            
            
            $
            57,847Sales,
      marketing and general and administrative expenses
            
            
            (1,593,365
            )
            
            
            (1,811,044
            )
            
            
            217,679Loss
      from operations
            
            $
            (628,967
            )
            
            $
            (904,493
            )
            
            $
            275,526Other
      income (expenses), net
            
            
            (17,930
            )
            
            
            2,619
            
            
            
            (20,549
            )Gain
      on fair value adjustment of derivatives
            
            
            ---
            
            
            
            305,620
            
            
            
            (305,620
            )Gain
      on settlement of derivative liabilities
            
            
            ---
            
            
            
            450,654
            
            
            
            (450,654
            )Loss
      before income taxes
            
            $
            (646,897
            )
            
            $
            (145,600
            )
            
            $
            (501,297
            )Income
      taxes
            
            
            ---
            
            
            
            ---
            
            
            
            ---Net
      loss
            
            $
            (646,897
            )
            
            $
            (145,600
            )
            
            $
            (501,297
            )





-2-
 Table of Contents


The
differing results of operations are primarily attributable to the
following:





▪
            a
      decrease in net revenues for the nine months ended September 30, 2009
      partly attributable to the following:▪
            the
      decreased number of upgrade sales;▪
            the
      decreased number of product releases; and▪
            the
      current economic downturn.▪
            a
      decrease in cost of sales for the nine months ended September 30, 2009 due
      primarily to decreased direct costs and amortization of software
      development costs;▪
            a
      decrease in sales, marketing and general and administrative expenses for
      the nine months ended September 30, 2009; and▪
            most
      notably for the nine months ended September 30, 2008:▪
            the
      recognition of a gain related to the fair value adjustment of derivatives
      up to the settlement date of March 6, 2008 due to the fluctuation of our
      stock price; and▪
            the
      recognition of a gain on settlement of derivative liabilities in relation
      to warrants issued in November 2004 and which were canceled on March 6,
      2008 in exchange for a single cash payment ($150,000) that was less than
      the calculated fair value of the derivatives on such
  date.





Our
software products are highly seasonal. More than 50% of our annual sales are
expected to occur in the five months of September through January; the five
months of April through August are generally our weakest, generating less than
30% of our annual sales.





Revenues





The
following table presents our revenues for the nine months ended September 30,
2009 and September 30, 2008 and dollar and percentage changes from the prior
year.





ChangeRevenues
      for Nine Months Ending September 30
            
            2009
            
            
            %
      to Sales
            
            
            2008
            
            
            %
      to Sales
            
            
            $
            
            
            
            %Gross
      revenues
            
            $
            1,678,364
            
            
            
            100
            %
            
            $
            1,716,965
            
            
            
            100
            %
            
            $
            (38,601
            )
            
            
            2
            %Less
      estimated sales returns and allowances
            
            
            (169,201
            )
            
            
            10
            %
            
            
            (158,909
            )
            
            
            9
            %
            
            
            (10,292
            )
            
            
            6
            %Net
      revenues
            
            $
            1,509,163
            
            
            
            90
            %
            
            $
            1,558,056
            
            
            
            91
            %
            
            $
            (48,893
            )
            
            
            3
            %





During
each of the nine months ended September 30, 2009 and 2008, our sales efforts
were focused on directly targeting end-users through telemarketing and Internet
sales.  Due to our increased product stability and the consistency in
our development schedule in regards to the annual releases of our flagship
product, QuickVerse®,
upgrade sales have not been increasing at as rapid a rate as they have in
previous years; and therefore, we experienced a decrease in gross revenues for
the nine months ended September 30, 2009.  Furthermore, we experienced
a decrease in our gross revenues due to the decreased number of product releases
during the nine months ended September 30, 2009. Although there can be no
assurance, we anticipate that our revenues in the future related to the
QuickVerse®
product line will remain consistent with our 2008 quarterly and annual figures
as we continue to expand the content made available for our QuickVerse®
products, develop new products for multiple platforms, offer our products at a
range of price points intended to appeal to various market sub-segments and
offer new venues to gain access to the expanded content available for our
QuickVerse®
customers.





During
the nine months ended September 30, 2009, we did recognize approximately $71,000
in revenue from the FormTool®
product line, which we acquired in February 2008.  We do anticipate
our revenues in relation to the FormTool®
product line to increase in the near-term based on our anticipated enhancements
to the FormTool.com website.





As a
percentage of gross revenues, our sales returns and allowances increased for the
nine months ended September 30, 2009 compared to September 30, 2008. Typically,
product returns trend upward after a new version is released as distributors and
retail stores return old product in exchange for the new version release. As
anticipated for the first three months ended September 30, 2009, distributors
and retail stores finalized their old product exchange of QuickVerse®
2008 for the new version release QuickVerse®
2009. This is also is true for the last three months ended September 30, 2009,
in relation to the new version release of QuickVerse®
Macintosh 3.0.  Furthermore, for the nine months ended September 30,
2009 we increased our reserve of sales returns due to the current economic
environment.  Generally going forward, it is our objective to release
enhanced versions of our biggest-selling products on an annual basis, and as a
percentage of gross revenues we anticipate sales returns and allowances to
decrease over time as a result of increased stability in the functionality of
our products, decreasing reliance on retail sales and increasing reliance on
direct sales, which have historically resulted in fewer returns, and improved
planning in the timing of new product version releases.





-3-
 Table of Contents


Cost
of Sales





The
following table presents our cost of sales for the nine months ended September
30, 2009 and September 30, 2008 and dollar and percentage changes from the prior
year.





ChangeCost
      of Sales for Nine Months Ending September 30
            
            2009
            
            
            %
      to Sales
            
            
            2008
            
            
            %
      to Sales
            
            
            $
            
            
            
            %Direct
      costs
            
            $
            148,426
            
            
            
            9
            %
            
            $
            220,125
            
            
            
            13
            %
            
            $
            (71,699
            )
            
            
            33
            %Less
      estimated cost of sales returns and allowances
            
            
            (25,245
            )
            
            
            2
            %
            
            
            (24,060
            )
            
            
            1
            %
            
            
            (1,185
            )
            
            
            5
            %Amortization
      of software development costs
            
            
            132,853
            
            
            
            8
            %
            
            
            192,433
            
            
            
            11
            %
            
            
            (59,580
            )
            
            
            31
            %Royalties
            
            
            166,489
            
            
            
            10
            %
            
            
            142,522
            
            
            
            8
            %
            
            
            23,967
            
            
            
            17
            %Freight-out
            
            
            74,344
            
            
            
            4
            %
            
            
            72,001
            
            
            
            4
            %
            
            
            2,343
            
            
            
            3
            %Fulfillment
            
            
            47,897
            
            
            
            3
            %
            
            
            48,485
            
            
            
            3
            %
            
            
            (588
            )
            
            
            1
            %Cost
      of sales
            
            $
            544,764
            
            
            
            32
            %
            
            $
            651,506
            
            
            
            38
            %
            
            $
            (106,742
            )
            
            
            16
            %





Cost of
sales consists primarily of direct costs, amortization of capitalized software
development costs, non-capitalized technical support wages, royalties accrued to
third party providers of intellectual property and the costs associated with
reproducing, packaging, fulfilling and shipping our products.





The
decrease in cost of sales between the nine months ended September 30, 2009 and
the corresponding period during 2008 is predominately attributable to decreased
direct costs and amortization of software development costs.  The
decrease in direct costs is a result of scaling down our technical support
department as our products continue to become more functionally
stable.  The launch of the QuickVerse®
Knowledgebase on our website has also helped us reduce our costs associated with
the technical support department.  Furthermore, the decreased amount
of new and/or enhanced product releases during the fiscal years 2008 and 2009
led to the decreased amount of amortization for the nine months ended September
30, 2009.





Royalties
increased in real terms and as a percentage of gross revenues for the nine
months ended September 30, 2009 due to an increase the sales of the
QuickVerse®
Platinum editions as well as an increase in QuickVerse®
Macintosh 3.0 and Sermon Builder 5.0.  Our royalty accruals are
expected to increase in the future in real terms as sales to new customers
increase, more development projects are implemented for new and/or enhanced
products, and as we continue to expand the content available for our
QuickVerse®
line of products. Upgrade sales will remain only subject to royalties on their
content additions.





Freight
costs and fulfillment costs remained stable as a percentage of gross revenues
for the nine months ended September 30, 2009.  The increase in freight
costs in real terms is a result of the QuickVerse®
Macintosh 3.0 release.  We do anticipate freight cost to increase
throughout the remainder of the year as retail sales tend to increase in the
fourth quarter, which carry higher shipping costs for us than direct and/or
upgrade sales.  Although there can be no assurance, we anticipate
freight costs related to direct and/or upgrade sales to decrease in the future
as we have continue to advertise and enhance the ability to offer our software
products as downloads from our website. Furthermore, due in large part to the
establishment of our own fulfillment center in June 2007, fulfillment costs
should remain relatively stable in the future as a percentage of gross
revenues.





-4-
 Table of Contents


The
amortization recognized during the nine months ended September 30, 2009 resulted
mainly from the following software releases:





▪
            FormTool®
      7.0 (released September 2008),▪
            QuickVerse®
      2009 (released October 2008),▪
            Charles
      H. Spurgeon Collection (released February 2009),▪
            Sermon
      Builder 5.0 (released March 2009),▪
            QuickVerse®
      Macintosh 3.0 (released August 2009),▪
            Early
      Church Fathers Collection (released August 2009) and▪
            Multiple
      new content additions for QuickVerse®
      products (released April 2007 through November
  2008).





Comparatively,
during the nine months ended September 30, 2008, the amortization recognized
resulted mainly from the following software releases:





▪
            QuickVerse®
      2007 Mobile (released December 2006),▪
            QuickVerse®
      2007 Macintosh (released March 2007),▪
            QuickVerse®
      2008 (released November 2007),▪
            Multiple
      new content additions for QuickVerse®
      products (released April 2007 through September 2008)
  and▪
            FormTool®
      7.0 (released September 2008).





As stated
above, the decrease in amortization for the nine months ended September 30, 2009
is the result of fewer development projects that were released during the fiscal
year 2008 and 2009. In the future, our objective is to realize overall increases
in revenues due to aggressive product development and release schedules as well
as the acquisitions of new product lines.





In the
future, as we continue to implement our strategy to become a principally
Webcentric provider of online products, we anticipate experiencing a decrease in
cost of sales, specifically direct costs, freight and fulfillment, as more of
our products will become available for download.





Software
      Development Costs For
            
            Three
      Months Ending September
      30,
            
            
            Nine
      Months Ending September
      30,2009
            
            
            2008
            
            
            2009
            
            
            2008Beginning
      balance
            
            $
            340,605
            
            
            $
            402,332
            
            
            $
            330,018
            
            
            $
            392,173Capitalized
            
            
            105,419
            
            
            
            75,983
            
            
            
            204,317
            
            
            
            243,270Amortized
      (Cost of sales)
            
            
            (44,542
            )
            
            
            (35,305
            )
            
            
            (132,853
            )
            
            
            (192,433
            )Ending
      Balance
            
            $
            401,482
            
            
            $
            443,010
            
            
            $
            401,482
            
            
            $
            443,010Research
      and development expense (General and administrative)
            
            $
            11,175
            
            
            $
            39,192
            
            
            $
            125,234
            
            
            $
            143,147





For the
three months ended September 30, 2009, the increase in capitalized costs as well
as the decrease in research and development expense is the result of our
development team focusing their efforts on the annual upgrade releases of
QuickVerse® for
both Macintosh and Windows.  The overall decrease of capitalized costs
and research and development expense for the nine months ended September 30,
2009 is attributed to the following:





▪
            our
      internal development team assisting our external software developers in
      training sessions for their new employees,▪
            an
      overall decrease in the number of development projects
  and▪
            an
      overall decrease in the number of third party man hours utilized towards
      development due to the decrease in the number of development
      projects.





-5-
 Table of Contents


Sales,
General and Administrative





ChangeSales,
      General and Administrative Costs for Nine Months Ending September
      30
            
            2009
            
            
            %
      to Sales
            
            
            2008
            
            
            %
      to Sales
            
            
            $
            
            
            
            %Selected
      expenses:Commissions
            
            $
            3,000
            
            
            
            0
            %
            
            $
            66,959
            
            
            
            4
            %
            
            $
            (63,959
            )
            
            
            96
            %Advertising
      and direct marketing
            
            
            105,904
            
            
            
            6
            %
            
            
            131,638
            
            
            
            8
            %
            
            
            (25,734
            )
            
            
            20
            %Sales
      and marketing wages
            
            
            243,477
            
            
            
            15
            %
            
            
            265,411
            
            
            
            15
            %
            
            
            (21,934
            )
            
            
            8
            %Other
      sales and marketing costs
            
            
            7,398
            
            
            
            0
            %
            
            
            3,212
            
            
            
            0
            %
            
            
            4,186
            
            
            
            130
            %Total
      sales and marketing
            
            $
            359,779
            
            
            
            21
            %
            
            $
            467,220
            
            
            
            27
            %
            
            $
            (107,441
            )
            
            
            23
            %Personnel
      costs
            
            $
            407,119
            
            
            
            24
            %
            
            $
            370,268
            
            
            
            22
            %
            
            $
            36,851
            
            
            
            10
            %Amortization
      and depreciation
            
            
            273,583
            
            
            
            16
            %
            
            
            343,178
            
            
            
            20
            %
            
            
            (69,595
            )
            
            
            20
            %Research
      and development
            
            
            125,234
            
            
            
            7
            %
            
            
            143,147
            
            
            
            8
            %
            
            
            (17,913
            )
            
            
            13
            %Corporate
      services
            
            
            25,338
            
            
            
            2
            %
            
            
            74,280
            
            
            
            4
            %
            
            
            (48,942
            )
            
            
            66
            %Other
      general and administrative costs
            
            
            402,312
            
            
            
            24
            %
            
            
            412,951
            
            
            
            24
            %
            
            
            (10,639
            )
            
            
            3
            %Total
      general and administrative
            
            $
            1,233,586
            
            
            
            73
            %
            
            $
            1,343,824
            
            
            
            78
            %
            
            $
            (110,238
            )
            
            
            8
            %Total
      sales, marketing, general and administrative
            
            $
            1,593,365
            
            
            
            95
            %
            
            $
            1,811,044
            
            
            
            105
            %
            
            $
            (217,679
            )
            
            
            12
            %





For the
nine months ended September 30, 2009, total sales and marketing costs decreased
significantly in real terms as well as a percentage of gross
revenues.  Commissions decreased considerably as we have discontinued
our contract with a third party for telemarketing services.  Although
there can be no assurance, we do not anticipate relying on a third party for
telemarketing services in the future, and therefore, we anticipate third party
commissions to be a minimal expense in the future.  Advertising and
direct marketing costs also decreased as we managed to cut our costs due to the
decreased gross revenues. We anticipate advertising and direct marketing costs
to remain relatively stable in future periods while we continue to enhance our
product visibility online, increase and focus more on our direct marketing
efforts, yet limit the scope and frequency of our print advertising campaigns to
those that we can capitalize on the most in order to maximize sales associated
with new products, product enhancements and potential new product
lines.  During the nine months ended September 30, 2009, sales and
marketing wages - reclassified, decreased as a result of streamlining our CBA
sales team, and therefore, we anticipate a decrease in future
periods.  However, we have recognized approximately $21,000 of expense
related to 725,000 restricted shares of common stock issued to our sales team
employees for the nine months ended September 30, 2009. While we would like to
expand our in-house direct-telemarketing sales team in relation to our current
and potential new product lines, we may not be able to do so in the immediate
future due to the current economic climate.




Net
personnel costs increased as a result of capitalizing and reclassifying
approximately $101,000 less in 2009 than in 2008.  This increase was
offset by a decrease in gross personnel costs of approximately $64,000 (from
approximately $933,000 for the nine months ended September 30, 2008 to
approximately $869,000 for the nine months ended September 30, 2009) even after
recognizing approximately $112,000 of expense related to 3,357,143 restricted
shares of common stock issued to employees as bonus compensation for services
rendered January 1, 2004 through December 31, 2008. The decrease in gross
personnel costs is the result of the departure of a member of the product
development team as we have streamlined this department with external,
independently contracted developers, the reduction in our technical support
staff as our software products become more stable, the loss of our Vice
President of Sales as we have restructured our CBA sales team and the
restructuring of our employee health care benefits plan.  As a
percentage of gross revenues, gross direct salaries and wages remained
relatively stable at approximately 51% for the nine months ended September 30,
2009 and 2008. Due to the current economic climate, we anticipate direct
salaries and wages to decrease in the future.




The
decrease in the amortization and depreciation expense is mainly attributable to
the decrease in amortization. The software license we acquired in 1999, from
which we derive our base intellectual property rights associated with the
products that are responsible for generating the overwhelming majority of our
revenues (the “1999 license”), was being amortized over a 10 year useful life
and became fully amortized as of June 30, 2009.  Amortization expense
for the nine months ended September 30, 2009 and 2008 reflect the continual
amortization of the 1999 license as well as the amortization of the
FormTool®
assets we acquired in February 2008. The FormTool®
assets are amortized over a period of years that range from less than one year
to ten years and approximate $3,000 of amortization expense each
month.  In addition, for the nine months ended September 30, 2009 we
recognized amortization expense for our FormTool®
website, www.formtool.com,
which was successfully re-launched in September 2008.  Overall, we
anticipate amortization and depreciation expense to decrease in future periods
as the amortization related to the 1999 license has ceased.





-6-
 Table of Contents


Research
and development costs include direct production costs (including labor directly
associated with the development projects), indirect costs (including allocated
fringe benefits, payroll taxes, facilities costs and management supervision),
and other direct costs (including costs of outside consultants, purchased
software to be included in the software product being developed, travel
expenses, material and supplies, and other direct costs). The decrease in
software development costs related to third-party developers and direct labor
expensed as research and development reflects fewer development projects and
therefore; fewer third party man hours needed towards development projects for
the nine months ended September 30, 2009. In future periods, we anticipate
research and development expenses to either decrease or remain relatively stable
as we have experienced an overall increased efficiency in our development output
(both internal and external).





Corporate
service fees decreased for the nine months ended September 30, 2009. The
corporate service fees incurred for the nine months ended September 30, 2008
were from engaging the services of a consultant for business development related
advisory services in March 2007.  While the consultant’s contract
ended in June 2008, we renewed the consultant’s contract for another period of
twelve to eighteen months at a reduced rate.





Gain
on Fair Value Adjustment of Derivatives





In
connection with warrants issued in November 2004, a non-cash fair value
adjustment of approximately $306,000 has been included in other income for the
nine months ended September 30, 2008. These warrants were accounted for as a
liability according to the guidance of EITF 00-19, Accounting for Derivative Financial
Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock
and the guidance of EITF 00-19-2, Accounting for Registration Payment
Arrangements.  These warrants were canceled on March 6, 2008
and there is no recognition, therefore, of a derivative liability on our
December 31, 2008 balance sheet.  Furthermore, we will not experience
a non-cash fair value adjustment related to these warrants which would be
included in other expenses or other income beyond the date of March 6,
2008.





Gain
on Settlement of Derivative Liabilities





On March
6, 2008, we entered into and consummated an agreement with Barron Partners, LP
in which warrants issued to that entity in November 2004 were immediately
canceled in exchange for a single cash payment to Barron Partners, LP in the
amount of $150,000.  As a result of this transaction, these warrants
are now null and void for all purposes.  We recorded a one time gain
during the nine months ended September 30, 2008 due to the agreement calling for
a cash payment that was less than the Black-Scholes calculated fair value of the
derivatives on such date.





Income
Taxes





For the
nine months ended September 30, 2009 and 2008, based on uncertainty about the
timing of and ability to generate future taxable income and our assessment that
the realization of the deferred tax assets no longer met the “more likely than
not” criterion for realization, we provided for a full valuation allowance
against our net deferred tax assets. If we determine that it is more likely than
not that we will be able to realize our deferred tax assets in the future, an
adjustment to the deferred tax asset valuation allowance would be recorded in
the period when such determination is made.





Liquidity
And Capital Resources





Our
primary needs for liquidity and capital resources are the working capital
requirements of our continued operations, which includes the ongoing internal
development of new products, expansion and upgrade of existing products, and
marketing and sales, as well as funding for the acquisition of new product lines
and/or companies. At this time it is unlikely that cash generated through our
continuing operations will be sufficient to sustain our continuing operations.
Furthermore, our pursuit of an aggressive growth plan, whether based on
internally developed products, licensing opportunities, or strategic product
line and/or company acquisitions, will likely require funding from outside
sources or the divestiture of one or more existing product lines (as occurred
with respect to our Membership Plus®
product line). Funding from outside sources may include but is not limited to
the pursuit of other financing options such as commercial loans, common stock
and/or preferred stock issuances and convertible notes. At this time, we have no
legally committed funds for future capital expenditures.





-7-
 Table of Contents


The
divestiture of our Membership Plus®
product line in October 2007 was driven by a combination of our need to raise
cash and a strategic determination to begin a long-term shift in our product
lines away from those within the faith-based vertical market and more towards
those that extend across the business-to-business and consumer segments more
generally.  With a portion of the funds we realized from the sale of
our Membership Plus®
product line, we purchased FormTool® in
February 2008 which was our first product line acquisition outside of the
faith-based market.  Although there can be no assurance, we anticipate
acquiring additional product lines and/or entering into business combinations
which will either replace or increase the revenue and free cash flow previously
produced by the Membership Plus®
product line.





Working
      Capital
            
            September
      30, 2009
            
            
            December
      31, 2008Current
      assets
            
            $
            339,648
            
            
            $
            712,066Current
      liabilities
            
            $
            1,775,436
            
            
            $
            1,815,561Retained
      deficit
            
            $
            8,704,274
            
            
            $
            8,057,377





While
liquidity for our day-to-day continued operations remains an ongoing concern for
us, and while there can be no continuing assurance, given the fact that a
substantial portion of our net sales – 57% of which we collected during the year
ended December 31, 2008 through credit card processing transactions – are able
to be collected in a much shorter timeframe (several days) than that in which we
must generally pay our trade payables (30 days) and our accrued royalties
(quarterly, semi-annually, or annually), the situation suggested by our
consistently and significantly negative ratio of current assets to current
liabilities has historically been manageable.





Cash
      Flows for Nine Months Ending September 30
            
            2009
            
            
            2008
            
            
            Change
            
            
            %Cash
      flows (used) by operating activities
            
            $
            (47,516
            )
            
            $
            (146,649
            )
            
            $
            99,133
            
            
            
            68
            %Cash
      flows (used) by investing activities
            
            $
            (196,693
            )
            
            $
            (378,408
            )
            
            $
            181,715
            
            
            
            48
            %Cash
      flows (used) by financing activities
            
            $
            (51,821
            )
            
            $
            (176,722
            )
            
            $
            124,901
            
            
            
            71
            %





Net cash
used by operating activities decreased for the nine months ended September 30,
2009 due to a reduction in cash received from customers which was offset in part
by a reduction in payments made to content providers, vendors and
employees.




The
decrease in net cash used by investing activities for the nine months ended
September 30, 2009 was due to the lack of investing activities related to asset
purchases and capitalized website development costs. Furthermore, we reduced our
restricted cash held in reserve by our merchant banker by approximately $32,000
by switching to a new merchant banker service. Comparatively, the cash used by
investing activities for the nine months ended September 30, 2008 was a result
of the purchase of FormTool® in
February 2008.





The
decrease in net cash used by financing activities for the nine months ended
September 30, 2009 was the result of only having continued payments made on
long-term notes payable. Comparatively for the nine months ended September 30,
2008, cash used by financing activities included payments made on long term
notes payable as well as a settlement payment to Barron Partners, LP in the
amount of $150,000 in exchange for the cancellation of the warrants issued in
November 2004.





Financing





We have
been unable to secure bank financing due to our internal financial ratios and
negative working capital position and do not expect that we will be successful
in securing any such financing unless and until our ratios in this regard
improve. However, it may be possible to secure financing on our open accounts
receivable in order to satisfy our future financing needs. Equity financing,
too, remains an option for us, though no definitive prospects for any such
financing have been specifically identified.





Contractual
Liabilities





In May
2007, we secured an operating lease with a third-party for our corporate office
facility in Omaha, Nebraska with terms extending through May 2012. We also
secured an operating lease with a third-party for a warehouse facility in Omaha,
Nebraska with terms extending through June 2010. In accordance with the terms of
these leasehold agreements, we are responsible for all associated taxes,
insurance and utility expenses.





-8-
 Table of Contents


At
September 30, 2009, the total future minimum rental payments required under
these leases is approximately $160,000 through the year 2012.





We lease
telephone equipment under a capital lease due to expire in November 2009. The
asset and liability under the capital lease are recorded at the present value of
the minimum lease payments. The asset is depreciated over a 5 year life. Total
minimum future lease payments under capital leases as of September 30, 2009 is
approximately $2,000 through the year 2009.





Off-Balance
Sheet Arrangements





We do not
have any off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources that is material to investors.





Contractual
Obligations





As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, we are not
required to provide this information.





ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.





As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, we are not
required to provide this information.





ITEM 4T. CONTROLS AND PROCEDURES.





Evaluation
of Disclosure Controls and Procedures





As
required by paragraph (b) of Rule 13a-15 under the Exchange Act, our principal
executive and principal financial officers are responsible for assessing the
effectiveness of our disclosure controls and procedures (as defined in Rule
13a-15(f) under the Exchange Act).  Accordingly, we maintain
disclosure controls and procedures designed to ensure that information required
to be disclosed in our filings under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods specified
in the Securities and Exchange Commission’s rules and forms.  Our
Chief Executive Officer and Chief Financial Officer have evaluated our
disclosure controls and procedures as of the end of the period covered by this
Quarterly Report on Form 10-Q September 30, 2009, and have determined that such
disclosure controls and procedures are effective.





Changes
in Internal Controls





There
were no changes in our internal control over financial reporting during the
fiscal quarter covered by this report that have materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.














-9-
 Table of Contents


PART II – OTHER INFORMATION





ITEM 1. LEGAL PROCEEDINGS.





On April
27, 2009, we received a letter from counsel for the plaintiff, Gary Odom, in a
civil proceeding that has been commenced in federal district court against
Findex, among numerous other co-defendants, notifying us of such proceeding. The
action alleges that our QuickVerse®
product incorporates certain patented source code owned by the plaintiff and for
which no appropriate authorization has been granted to Findex. While we are of
the belief that the intellectual property infringement claims asserted against
us in this action are without merit, any such claims, whether or not
meritorious, could result in costly litigation or require us to enter into
royalty or licensing agreements. If we are found to have infringed the
proprietary rights of others, we could be required to pay damages, redesign the
products or discontinue their sale. Any of these outcomes, individually or
collectively, could have a material adverse effect on our business, our
financial condition, including liquidity and profitability, and our results of
operations.





As of the
date of this quarterly report on Form 10-Q for the period ended September 30,
2009, and to the best knowledge of our officers and directors, there were no
other pending material legal proceedings to which we were a party and we were
not aware that any were contemplated. There can be no assurance, however, that
we will not be made a party to litigation in the future.





ITEM 1A. RISK FACTORS.





As a
“smaller reporting company” as defined by Item 10 of Regulation S-K, the Company
is not required to provide information required by this Item.





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





There
were no reportable events under this Item 3 during the quarterly period ended
September 30, 2009.





ITEM 3. DEFAULTS UPON SENIOR SECURITIES.





As of the
date of this quarterly report on Form 10-Q for the period ended September 30,
2009, we are in default under a certain unsecured term note payable to a
shareholder in the total amount of approximately $70,000.  The
arrearage as of such date was $56,000, plus interest.  In accordance
with the terms of the note, our default has triggered an acceleration of the
entire balance plus accumulated interest.





ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY
HOLDERS.





No
matters were submitted to a vote of our stockholders during the quarterly period
ended September 30, 2009.





ITEM 5. OTHER INFORMATION.





There
were no reportable events under this Item 5 during the quarterly period ended
September 30, 2009.





ITEM 6. EXHIBITS.





Exhibits
required by Item 601 of Regulation S-K.





No.
            Description
      of Exhibit2.1
            Share
      Exchange Agreement between Findex.com, Inc. and the stockholders of Reagan
      Holdings, Inc. dated March 7, 2000, incorporated by reference to Exhibit
      2.1 on Form 8-K filed March 15, 2000.3(i)(1)
            Restated
      Articles of Incorporation of Findex.com, Inc. dated June 1999 incorporated
      by reference to Exhibit 3.1 on Form 8-K filed March 15,
    2000.  -10-
 Table of Contents
  3(i)(2)
              Amendment
      to Articles of Incorporation of Findex.com, Inc. dated November 10, 2004
      incorporated by reference to Exhibit 3.1(ii) on Form 10-QSB filed November
      10, 2004.3(ii)
              Restated
      By-Laws of Findex.com, Inc., incorporated by reference to Exhibit 3.3 on
      Form 8-K filed March 15, 2000.10.1
              Stock
      Incentive Plan of Findex.com, Inc. dated May 7, 1999, incorporated by
      reference to Exhibit 10.1 on Form 10-KSB/A filed May 13,
    2004.10.2
              Share
      Exchange Agreement between Findex.com, Inc. and the stockholders of Reagan
      Holdings Inc., dated March 7, 2000, incorporated by reference to Exhibit
      2.1 on Form 8-K filed March 15, 2000.10.3
              License
      Agreement between Findex.com, Inc. and Parsons Technology, Inc. dated June
      30, 1999, incorporated by reference to Exhibit 10.3 on Form 10-KSB/A filed
      May 13, 2004.10.4
              Employment
      Agreement between Findex.com, Inc. and Steven Malone dated July 25, 2003,
      incorporated by reference to Exhibit 10.4 on Form 10-KSB/A filed May 13,
      2004.10.5
              Employment
      Agreement between Findex.com, Inc. and Kirk Rowland dated July 25, 2003,
      incorporated by reference to Exhibit 10.5 on Form 10-KSB/A filed May 13,
      2004.10.6
              Employment
      Agreement between Findex.com, Inc. and William Terrill dated June 7, 2002,
      incorporated by reference to Exhibit 10.6 on Form 10-KSB/A filed May 13,
      2004.10.7
              Restricted
      Stock Compensation Agreement between Findex.com, Inc. and John A. Kuehne
      dated July 25, 2003, incorporated by reference to Exhibit 10.7 on Form
      10-KSB/A filed May 13, 2004.10.8
              Restricted
      Stock Compensation Agreement between Findex.com, Inc. and Henry M.
      Washington dated July 25, 2003, incorporated by reference to Exhibit 10.8
      on Form 10-KSB/A filed May 13, 2004.10.9
              Restricted
      Stock Compensation Agreement between Findex.com, Inc. and William Terrill
      dated July 25, 2003, incorporated by reference to Exhibit 10.9 on Form
      10-KSB/A filed May 13, 2004.10.10
              Stock
      Purchase Agreement, including the form of warrant agreement, between
      Findex.com, Inc. and Barron Partners, LP dated July 19, 2004, incorporated
      by reference to Exhibit 10.1 on Form 8-K filed July 28,
    2004.10.11
              Amendment
      No. 1 to Stock Purchase Agreement between Findex.com, Inc. and Barron
      Partners, LP dated September 30, 2004, incorporated by reference to
      Exhibit 10.3 on Form 8-K filed October 6, 2004.10.12
              Registration
      Rights Agreement between Findex.com, Inc. and Barron Partners, LP dated
      July 26, 2004, incorporated by reference to Exhibit 10.2 on Form 8-K filed
      July 28, 2004.10.13
              Waiver
      Certificate between Findex.com, Inc. and Barron Partners, LP dated
      September 16, 2004, incorporated by reference to Exhibit 10.4 on Form 8-K
      filed October 6, 2004.10.14
              Settlement
      Agreement between Findex.com, Inc., The Zondervan Corporation, Mattel,
      Inc., TLC Multimedia, Inc., and Riverdeep, Inc. dated October 20, 2003,
      incorporated by reference to Exhibit 10.14 on Form 10-KSB/A filed December
      14, 2005.10.15
              Employment
      Agreement Extension between Findex.com, Inc and Steven Malone dated March
      31, 2006, incorporated by reference to Exhibit 10.1 on Form 8-K filed
      April 6, 2006.10.16
              Employment
      Agreement Extension between Findex.com, Inc and William Terrill dated
      March 31, 2006, incorporated by reference to Exhibit 10.2 on Form 8-K
      filed April 6, 2006.  -11-
 Table of Contents
 10.17
              Employment
      Agreement Extension between Findex.com, Inc and Kirk R. Rowland dated
      March 31, 2006, incorporated by reference to Exhibit 10.3 on Form 8-K
      filed April 6, 2006.10.18
              Promissory
      Note to Barron Partners, LP dated April 7, 2006, incorporated by reference
      to Exhibit 10.1 on Form 8-K filed April 13, 2006.10.19
              Share
      Exchange Agreement between Findex.com, Inc. and the stockholders of Reagan
      Holdings Inc., dated March 7, 2000, incorporated by reference to Exhibit
      2.1 on Form 8-K filed March 15, 2000.10.20
              Convertible
      Secured Promissory Note between FindEx.com, Inc. and W. Sam Chandoha,
      dated July 20, 2006, incorporated by reference to Exhibit 10.1 on Form 8-K
      filed July 26, 2006.10.21
              Security
      Agreement between FindEx.com, Inc. and W. Sam Chandoha, dated July 20,
      2006 incorporated by reference to Exhibit 10.2 on Form 8-K filed July 26,
      2006.10.22
              Common
      Stock Purchase Warrant between FindEx.com, Inc. and W. Sam Chandoha, dated
      July 20, 2006 incorporated by reference to Exhibit 10.3 on Form 8-K filed
      July 26, 2006.10.23
              Modification
      and Extension Agreement Between FindEx.com, Inc. and W. Sam Chandoha,
      dated September 20, 2006, incorporated by reference to Exhibit 10.1 on
      Form 8-K filed September 25,2006.10.24
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and Steven Malone
      dated April 13, 2007, incorporated by reference to Exhibit 10.24 on Form
      10-KSB filed April 17, 2007.10.25
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and William Terrill
      dated April 13, 2007, incorporated by reference to Exhibit 10.25 on Form
      10-KSB filed April 17, 2007.10.26
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and Kirk R. Rowland
      dated April 13, 2007, incorporated by reference to Exhibit 10.26 on Form
      10-KSB filed April 17, 2007.10.27
              Asset
      Purchase Agreement between Findex.com, Inc. and ACS Technologies Group,
      Inc. dated October 18, 2007, incorporated by reference to Exhibit 10.27 on
      Form 8-K filed October 24, 2007.10.28
              Partial
      Assignment of License Agreement Among Findex.com, Inc., Riverdeep,
      Inc.,LLC and ACS Technologies Group, Inc. dated October 11, 2007,
      incorporated by reference to Exhibit 10.28 on Form 8-K filed October 24,
      2007.10.29
              Asset
      Purchase Agreement between Findex.com, Inc. and ORG Professional, LLC
      dated February 25, 2008, incorporated by reference to Exhibit 10.29 on
      Form 8-K filed on February 28, 2008.10.30
              Warrant
      Cancellation Agreement between Findex.com, Inc. and Barron Partners, L.P.
      dated March 6, 2008, incorporated by reference to Exhibit 10.30 on Form
      8-K filed on March 10, 2008.10.31
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and Steven Malone
      dated April 14, 2008, incorporated by reference to Exhibit 10.31 on Form
      10-KSB filed on April 15, 2008.10.32
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and William Terrill
      dated April 14, 2008, incorporated by reference to Exhibit 10.32 on Form
      10-KSB filed on April 15, 2008.10.33
              Employment
      Agreement Extension Amendment between Findex.com, Inc. and Kirk R. Rowland
      dated April 14, 2008, incorporated by reference to Exhibit 10.33 on Form
      10-KSB filed on April 15, 2008.  -12-
 Table of Contents
 31.1
              Certification
      of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002 and dated November 23, 2009. FILED
HEREWITH.31.2
              Certification
      of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002 and dated November 23, 2009. FILED
HEREWITH.32.1
              Certification
      of Chief Executive Officer and Chief Financial Officer pursuant to Section
      906 of the Sarbanes-Oxley Act of 2002 and dated November 23,
      2009.  FILED HEREWITH.





Signatures





Pursuant
to the requirements of the Securities and Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.





FINDEX.COM,
      INC.Date:
      November 23, 2009
            By
            /s/ Steven MaloneSteven
      MalonePresident
      and Chief Executive Officer





Date:
      November 23, 2009
            By
            /s/ Kirk R. RowlandKirk
      R. Rowland, CPAChief
      Financial Officer (Principal Financial & Accounting
      Officer)































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 Table of Contents