UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 5, 2001
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THE BAUER PARTNERSHIP, INC.
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(Exact name of registrant as specified in its charter)
Nevada 0-27323 88-0429812
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) file number) Identification Number)
8 Queen Street, Mayfair, London W1J 5PD, United Kingdom
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(Address of principal executive offices)(Zip Code)
44-207-016-6708
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(Registrant's telephone number, including area code)
Finders Keepers, Inc.
6975 South Union Park Center #600
Salt Lake City, Utah 84047 (Former name
and former address, if changed since last report)
This amended Form 8-K relates to the transaction on December 5, 2001 pursuant to
which Finders Keepers, Inc. (the "Company") completed the acquisition of The
Bauer Partnership, Inc., a Delaware corporation ("Bauer"), and changed the name
of the Company to The Bauer Partnership, Inc. As permitted, the original Form
8-K omitted certain financial statements of Bauer required by Form 8-K. This
amendment is filed to provide the financial statements of Bauer.
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired
Independent Auditor's Report
Balance Sheet as of March 31, 2001
Statement of Operations for the period March 23, 2001
(Inception) to March 31, 2001
Statement of Stockholders' Equity for the period March
23, 2001 (Inception) to March 31, 2001
Statement of Cash Flows for the period March 23, 2001
(Inception) to March 31, 2001
Notes to Financial Statements
Balance Sheet as of September 30, 2001 (Unaudited) Statement
of Operations for the period March 23, 2001
(Inception) to September 30, 2001 (Unaudited) Statement of
Cash Flows for the period March 23, 2001
(Inception) to September 30, 2001 (Unaudited)
Notes to Financial Statements (Unaudited)
(b) Pro Forma Financial Information
The acquisition of Bauer by the Company will be accounted for
using the purchase method of accounting. Bauer will be deemed the
acquiror for accounting and financial reporting purposes. Because
pro forma financial statements giving effect to the Exchange on a
historical basis would be substantially identical to the
financial statements of Bauer, no pro forma financial statements
are included herewith.
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
The Bauer Partnership, Inc.
New York, New York
We have audited the accompanying balance sheet of The Bauer Partnership, Inc. as
of March 23, 2001 (inception), and the related statements of operations,
stockholders' equity, and cash flows for the period from March 23, 2001
(inception) through March 31, 2001. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of The Bauer Partnership, Inc. as
of March 31, 2001, and the results of its operations and its cash flows from
March 23, 2001 through March 31, 2001, in conformity with accounting principles
generally accepted in the United States.
Malone & Bailey, PLLC
Houston, Texas
www.malone-bailey.com
March 28, 2002
THE BAUER PARTNERSHIP, INC.
BALANCE SHEET
March 31, 2001
ASSETS
$ --
========
LIABILITIES AND STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $.001 par value, 25,000,000 shares
authorized, no shares issued and outstanding --
Common stock, $.001 par value, 200,000,000 shares
authorized, 28,600,000 shares issued and outstanding 28,600
Accumulated deficit (28,600)
--------
Total Stockholders' Equity --
--------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ --
========
See accompanying summary of accounting policies
and notes to financial statements.
THE BAUER PARTNERSHIP, INC.
STATEMENTS OF OPERATIONS
For the Period March 23, 2001 (Inception) Through March 31, 2001
General and administrative expenses $ 28,600
------------
Net loss $ (28,600)
============
Net loss per share:
------------
Net loss basic and diluted $ (0.00)
============
Weighted average shares outstanding:
Basic and diluted 28,600,000
============
See accompanying summary of accounting policies
and notes to financial statements.
THE BAUER PARTNERSHIP, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY For the
Period from March 23, 2001 (Inception) Through March 31, 2001
Common stock
--------------------- Accumulated
Shares Amount deficit Total
----------- ----------- ----------- -----------
Issuance of common stock to founders
28,600,000 $ 28,600 $ -- $ 28,600
Net loss -- -- (28,600) (28,600)
----------- ----------- ----------- -----------
Balance,
March 31, 2001 28,600,000 $ 28,600 $ (28,600) $ --
=========== =========== =========== ===========
See accompanying summary of accounting policies
and notes to financial statements.
THE BAUER PARTNERSHIP, INC.
STATEMENTS OF CASH FLOWS
For the Period from March 23, 2001 (Inception) Through March 31, 2001
2001
--------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(28,600)
Adjustments to reconcile net deficit to cash used by operating
activities:
Common stock for services 28,600
--------
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES --
--------
NET INCREASE (DECREASE) IN CASH --
Cash, beg. of period --
--------
Cash, end of period $ --
========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ --
Income taxes paid $ --
See accompanying summary of accounting policies
and notes to financial statements.
THE BAUER PARTNERSHIP, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF ACCOUNTING POLICIES
Nature of business
The Bauer Partnership, Inc. ("Bauer") was incorporated in March 2001 under the
laws of the state of Delaware. Bauer was formed to provide investment banking
services to United States publicly traded companies seeking financing in the
range of $5 million to $20 million who are unable to secure large underwriters
or who wish to attract a global span of investors to their corporations.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the balance sheet. Actual results could differ from those estimates.
Cash Equivalents
Cash equivalents include highly liquid, temporary cash investments having
original maturity dates of three months or less. For reporting purposes, such
cash equivalents are stated at cost plus accrued interest which approximates
fair value.
Revenue Recognition
Revenues are recorded as services are performed. Investment banking revenue
includes gains, losses, and fees, net of syndicate expenses, arising from
offerings in which Bauer acts as an agent. Revenues from investment banking
services include warrants that are received upon the execution of an agreement.
Bauer receives additional compensation in cash and warrants upon the sale of the
company stock.
Long-lived Assets
Property and equipment are stated at cost less accumulated depreciation. Major
renewals and improvements are capitalized; minor replacements, maintenance and
repairs are charged to current operations. Depreciation is computed by applying
the straight-line method over the estimated useful lives of each asset. Bauer
performs reviews for the impairment of long-lived assets whenever events or
changes in circumstances indicate that the carrying amount of an asset may not
be recoverable.
Income Taxes
The asset and liability approach is used to account for income taxes by
recognizing deferred tax assets and liabilities for the expected future tax
consequences of temporary differences between the carrying amounts and the tax
bases of assets and liabilities. Bauer records a valuation allowance to reduce
the deferred tax assets to the amount that is more likely than not to be
realized.
Earnings Per Common Share
Basic and diluted net loss per share excludes dilution and is computed by
dividing net loss by the weighted average number of common shares outstanding
for the period presented
Recent Accounting Pronouncements
Bauer does not expect the adoption of recently issued accounting pronouncements
to have a significant impact on the Bauer's results of operations, financial
position or cash flows.
Note 2 - REVERSE MERGER
On October 5, 2001, Bauer entered into an Exchange Agreement with Finder's. In
December 2001, the Exchange Agreement became effective (the Exchange). Under the
Exchange, Bauer became a wholly owned subsidiary of Finder's, with Finder's
changing its name to Bauer. Pursuant to the Exchange, all of the outstanding
common shares of Finder's were exchanged for 4,064,206 shares of Bauer. The
transaction was regarded as a reverse merger whereby Bauer was considered to be
the accounting acquirer as it retained control of Finder's after the Exchange.
Certain shareholders of Finder's agreed to cancel 10,000 shares of redeemable
preferred stock in connection with the Exchange. Bauer also paid $300,000 in
connection with this transaction. The fee is included in other general and
administrative expense.
Since Finder's balance sheet is insignificant, a pro-forma balance sheet is not
presented here.
NOTE 3 - FOREIGN TAX REFUND CLAIMS
Bauer has recorded a claim for amounts paid for value added taxes on goods and
services due to its current losses.
NOTE 4 - INCOME TAXES
For the period from inception through March 31, 2001, Bauer has incurred a net
loss and, therefore, has no tax liability.
NOTE 5 - RELATED PARTY TRANSACTIONS
Bauer neither owns nor leases any real or personal property. An officer has
provided office services without charge. Such costs are immaterial to the
financial statements and accordingly are not reflected herein.
NOTE 6 - SHAREHOLDERS EQUITY
Common Stock:
Bauer is authorized to issue 200,000,000 common shares of stock at a par value
of $0.001 per share and 25,000,000 shares of $.001 par value preferred stock.
In March 2001, Bauer issued 28,600,000 shares of common stock to its founders
for services valued at $28,600 or the fair value of the services provided.
Effective April 2, 2001, Bauer entered into an employment agreement with Ronald
J. Bauer, its Chief Executive Officer, for two years at an annual salary of
$174,000 per year. In addition, Mr. Bauer receives $4,900 per month for a
residence in London as well as $4,900 per month for a car allowance, insurance
and gas. The agreement contains a severance clause for early termination in
which case Mr. Bauer will receive all remaining amounts due under the employment
agreement. Minimum amounts due under this employment agreement as $291,600 in
2002 and $72,900 in 2003.
NOTE 7 - SUBSEQUENT EVENTS
In April 2000, Bauer issued 900,000 shares for legal and consulting services
valued at $9,000 or the fair value of the services provided.
Between July and November 2001, Bauer issued 1,098,800 shares of common stock
for cash of $669,100.
In connection with the reverse merger (see Note 2), Bauer issued 4,064,206
shares of common stock.
In December 2001, Bauer issued 5,000,000 shares for consulting services valued
at $2,100,000 or the fair value of the services provided.
Effective April 2, 2001, Bauer entered into an employment agreement with Ronald
J. Bauer, its Chief Executive Officer, for two years at an annual salary of
$174,000 per year. In addition, Mr. Bauer receives $4,900 per month for a
residence in London as well as $4,900 per month for a car allowance, insurance
and gas. The agreement contains a severance clause for early termination in
which case Mr. Bauer will receive all remaining amounts due under the employment
agreement. Minimum amounts due under this employment agreement as $291,600 in
2002 and $72,900 in 2003.
In January 2002, Bauer and one of its wholly-owned subsidiaries entered into a
Share and Asset Purchase Agreement to acquire the Windjammer Resort & Spa in St.
Lucia, British West Indies. The acquisition price is $30,000,000 and is
comprised of $18 million in cash and $12,000,000 in the form of a convertible
debenture bearing interest at 8% per year which is convertible into Bauer's
common stock at $1.80 per share based on specified criteria in the agreement. In
connection with this agreement, Bauer has made non-refundable payments of
$200,000 towards the purchase price and owes $17.8 million by May 1, 2002,
unless Bauer is granted an extension. Bauer is working to obtain bank financing
to close this transaction and is also trying to get an extension in the event it
is unable to obtain financing by May 1, 2002. In the event Bauer closes this
transaction by obtaining the required financing, Bauer will receive a 39%
interest in net profits commencing January 31, 2002 through the closing date.
In March 2002, Bauer entered into a loan agreement with Ocean Strategic Holdings
Ltd. and Turbo International Ltd. whereby Bauer receives a 90 day loan of
$500,000 based on the following: (1) $150,000 upon execution and delivery of the
loan agreement, less $10,000 to be paid to the lenders' attorneys; (2) $50,000
upon the lenders' and/or Bauer's receipt of all of the transaction documents
duly executed and delivered pursuant to the loan agreement, less $5,000 to be
paid to the lenders' attorneys; (3) $100,000 upon Bauer's filing of its annual
report on Form 10-K for the year ended December 31, 2001 and amendment to its
current report on Form 8-K dated December 5, 2001 containing all of the
financial statements to be filed in connection there with, less any expenses to
be paid to lenders' attorneys; and (4) $200,000 upon the lenders receipt of a
copy of a written loan commitment to the Company from a reputable lending
institution approved by the lenders, which approval shall not be unreasonably
withheld, for no less than $18,000,000, less $5,000 to be paid to lenders'
attorneys. Bauer has received $185,000 in connection with the loan as of the
date of this report, of which a non-refundable payment of $100,000 was made in
connection with the Share and Asset Purchase Agreement involving the Windjammer
Resort & Spa. In connection with the loan agreement, the lenders received a 10%
interest in the outstanding stock of The Bauer Windjammer Resort and Spa
(Bahamas) Ltd., a wholly-owned subsidiary of Bauer Capital Management, Limited
which is a wholly-owned subsidiary of Bauer. In addition, the lenders received
an aggregate of three-year redeemable warrants to purchase 3,000,000 shares,
subject to adjustment as provided in the agreement, at an exercise price of $.20
per share. Ronald J. Bauer, chief executive officer, pledged 17,312,500 shares
of Bauer common stock held in the name of Fleming Financial Holdings, Ltd.
pursuant to a pledge and security agreement. In the event the loan is not repaid
in its entirety within 120 days from the date the loan agreement was executed,
the loans shall automatically convert into 50,000,000 shares of Bauer common
stock resulting in a change of control of Bauer. The lenders have the right to
loan up to $500,000 in four separate transactions under substantially the same
terms and conditions as the loan agreement. In addition, the lenders have a
first right of refusal to provide future financing to Bauer.
THE BAUER PARTNERSHIP, INC.
CONSOLIDATED BALANCE SHEET
September 30, 2001
(Unaudited)
ASSETS
Current assets
Cash $ 4,503
Accounts receivable 40,150
Investments 33,000
Foreign tax refund claims 127,355
-----------
Total current assets 205,008
Property and equipment, net 22,895
-----------
$ 227,903
===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Bank overdraft $ 47,345
Accounts payable 197,750
Accrued interest 25,752
Notes payable - related parties 662,500
-----------
Total current liabilities 933,347
-----------
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, $.001 par value, 25,000,000 shares
authorized, no shares issued and outstanding --
Common stock, $.001 par value, 200,000,000 shares
authorized, 30,983,521 shares issued and outstanding 30,984
Additional paid in capital 619,716
Accumulated deficit (1,356,144)
-----------
Total Stockholders' Equity (Deficit) (705,444)
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 227,903
===========
See accompanying notes to interim condensed
consolidated financial statements.
THE BAUER PARTNERSHIP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Period March 23, 2001 (Inception) Through September 30, 2001
(Unaudited)
2001
------------
Revenues $ 138,150
Cost and Expenses:
Salaries and benefits 438,428
Rent 148,622
Other general and administrative 875,034
Depreciation and amortization 6,458
------------
1,468,542
------------
Loss from operations (1,330,392)
Interest expense 25,752
------------
Net loss $ (1,356,144)
============
Net loss per share:
------------
Net loss basic and diluted $ (0.05)
============
Weighted average shares outstanding:
Basic and diluted 29,700,732
============
See accompanying notes to interim condensed
consolidated financial statements.
THE BAUER PARTNERSHIP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Period from March 23, 2001 (Inception) Through September 30, 2001
(Unaudited)
2001
-----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(1,356,144)
Adjustments to reconcile net deficit to cash used by operating
activities:
Depreciation and amortization 6,458
Common stock for services 37,600
Net change in:
Accounts receivable (40,150)
Investments (33,000)
Foreign tax refund claims (127,355)
Bank overdraft 47,345
Accounts payable and accrued expenses 223,502
-----------
CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES (1,241,744)
-----------
CASH FLOWS FROM INVESTING ACTIVITIES
-----------
Capital expenditures (29,353)
-----------
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 613,100
Proceeds from notes payable 662,500
-----------
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES 1,275,600
-----------
NET INCREASE (DECREASE) IN CASH 4,503
Cash, beg. of period --
-----------
Cash, end of period $ 4,503
===========
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ --
Income taxes paid $ --
THE BAUER PARTNERSHIP, INC.
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2001
NOTE 1:PRESENTATION
The condensed balance sheet of The Bauer Partnership, Inc. ("Bauer") as of
September 30, 2001, the related condensed consolidated statements of operations
and cash flows for the period from March 23, 2001 through September 30, 2001
included in the condensed consolidated financial statements have been prepared
by Bauer without audit. In the opinion of management, the accompanying condensed
consolidated financial statements include all adjustments (consisting of normal,
recurring adjustments) necessary to summarize fairly Bauer's financial position
and results of operations. The results of operations for the nine months ended
September 30, 2001 are not necessarily indicative of the results of operations
for the full year or any other interim period.
NOTE 2 - FOREIGN TAX REFUND CLAIMS
Bauer has recorded a claim for amounts paid for value added taxes on goods and
services due to its current losses.
NOTE 3 - NOTES PAYABLE - RELATED PARTIES
Notes payable - related parties consists of the following at September 30:
2001
---------
Promissory note to an officer and majority shareholder,
unsecured, principal and interest due upon demand,
bearing interest at 8%
$ 180,000
Promissory note to an entity of an officer and majority
shareholder, unsecured, principal and interest due upon
demand, bearing interest at 8%
140,000
Promissory note to a Director and shareholder, unsecured,
principal and interest due upon demand,
bearing interest at 12%
150,000
Promissory note to a Director and shareholder, unsecured,
principal and interest due upon demand,
bearing interest at 10%
100,000
Promissory note to a Director and shareholder, unsecured,
principal and interest due upon demand,
bearing interest at 10%
55,500
Promissory note to a Director and shareholder, unsecured,
principal and interest due upon demand,
bearing interest at 10%
37,000
---------
$ 662,500
=========
NOTE 4 - SHAREHOLDERS EQUITY
Common Stock:
Bauer is authorized to issue 200,000,000 common shares of stock at a par value
of $0.001 per share and 25,000,000 shares of $.001 par value preferred stock.
In March 2001, Bauer issued 28,600,000 shares of common stock to its founders
for services valued at $28,600 or the fair value of the services provided.
In April 2000, Bauer issued 900,000 shares for legal and consulting services
valued at $9,000 or the fair value of the services provided.
Between July and September 2001, Bauer issued 986,800 shares of common stock for
cash of $613,100.
NOTE 5 - COMMITMENTS
Bauer leases office facilities under non-cancelable operating leases with terms
up to two years. Rent expense was $148,622 for the period ended September 30,
2001.
Bauer's minimum rental commitments under non-cancelable operating leases at
September 30, 2001 were approximately $79,000 in 2001, $57,200 in 2002, and
$1,200 in 2003.
Effective April 2, 2001, Bauer entered into an employment agreement with Ronald
J. Bauer, its Chief Executive Officer, for two years at an annual salary of
$174,000 per year. In addition, Mr. Bauer receives $4,900 per month for a
residence in London as well as $4,900 per month for a car allowance, insurance
and gas. The agreement contains a severance clause for early termination in
which case Mr. Bauer will receive all remaining amounts due under the employment
agreement. Minimum amounts due under this employment agreement as $24,300 in
2001, $291,600 in 2002 and $72,900 in 2003.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Current Report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
THE BAUER PARTNERSHIP, INC
Dated: April 11, 2002
By: /s/ Ronald J. Bauer
----------------------
Ronald J. Bauer
Chief Executive Officer