SEC Filing Summary: Broadleaf Capital Partners, Inc. (10-KSB)
Business Context and Reporting Period
Company: Broadleaf Capital Partners, Inc. (Nevada Corporation)
Filing Type: Form 10-KSB (Annual Report)
Reporting Period: Fiscal year ended December 31, 2005 (with comparative data through 2009).
Business Overview: A publicly traded diversified investment holding company. The Company's primary asset is a 1% limited partnership interest in the Canyon Shadows Apartments project. The Company is in a restructuring phase, seeking new investment opportunities in real estate and finance while managing significant historical liabilities. It previously operated as a Business Development Corporation (BDC) but rescinded that status in 2005.
Key Financial Metrics (Fiscal Year 2005)
| Metric | 2005 Value | 2004 Value |
|---|---|---|
| Revenues | $173,880 | $193,949 |
| Net Income (Loss) | $(408,965) | $514,527 |
| Total Assets | $163,755 | $785,612 |
| Total Liabilities | $1,912,589 | $2,165,666 |
| Stockholders' Deficit | $(1,748,834) | $(1,380,054) |
| Cash and Equivalents | $1,600 | $3,957 |
| Outstanding Shares | 140,473,605 | 116,461,640 |
Note: The Company reported a significant loss in 2005 driven by a $247,554 reduction in investment value and a $111,350 loss on investment write-downs, offset partially by $113,652 in gain on debt forgiveness.
Material Changes vs. Prior Period
- Revenue Decline: Revenues decreased by approximately $20,069 (10.3%) compared to 2004. This was primarily due to the Company's transition from a General Partner to a Limited Partner in the Canyon Shadows project, reducing its share of income.
- Asset Reduction: Total assets plummeted by $621,857 (79%) from 2004 to 2005. This was caused by the refinancing of the Canyon Shadows project, which reduced the recorded investment value, and the write-off of other investments deemed to have no value.
- Liability Reduction: Total liabilities decreased by $253,077 due to debt settlements and restructuring agreements.
- Equity Dilution: The Company issued significant shares of common stock in 2005 to settle debts and raise capital, increasing the share count from ~116 million to ~140 million.
Outlook, Risks, and Management Commentary
- Going Concern: The auditors issued a "Going Concern" opinion. The Company has an accumulated deficit of approximately $15 million (as of 2009) and a working capital deficit. Continued operations depend on raising additional capital or generating sufficient revenue.
- Liquidity: Cash resources are critically low. The Company relies on distributions from its sole investment (Canyon Shadows) and debt restructuring to fund operations.
- Debt Status: As of the filing date, the Company was in default on certain notes payable. Management is actively seeking to convert debt to equity or negotiate settlements.
- Internal Controls: Management concluded that internal controls over financial reporting were ineffective due to limited resources, lack of segregation of duties, and insufficient experienced personnel.
- Stock Status: The common stock is quoted on the OTC Bulletin Board and is classified as a "penny stock," limiting liquidity and trading volume.
Investor Verification Checklist
- Verify Going Concern Status: Confirm if the Company has secured the additional financing required to avoid ceasing operations.
- Debt Default Resolution: Investigate the current status of the defaulted notes payable and any legal actions taken by creditors.
- Investment Valuation: Review the current fair value of the Canyon Shadows investment, which represents the majority of the Company's assets.
- Share Dilution: Assess the impact of recent and potential future stock issuances used to settle debts on existing shareholder value.
- Internal Control Remediation: Determine if the Company has implemented a formal framework to address the material weaknesses in financial reporting.