Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
(Mark
One)
x
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ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For the
fiscal year ended December 31, 2009
o
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TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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For the
transition period from __________________ to
__________________________.
Commission
File Number: 333-148910
ADAMA TECHNOLOGIES
CORP.
(Exact
name of registrant as specified in its charter)
Delaware
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98-0552470
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(State
or other jurisdiction of incorporation)
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(IRS
Employer Identification No.)
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c/o Aviram Malik, 76/7
Zalman Shazar Street, Hod Hasharon, Israel 45350
(Address
of principal executive
offices) (Zip
Code)
Registrant’s
telephone number, including area code: +972-72-212-1324
Securities
registered pursuant to Section 12(b) of the Act: None
Securities
registered pursuant to section 12(g) of the Act: Common Stock, $0.0001 par
value
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. Yes o No x
Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. Yes o No x
Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes x No o
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K (§229.405 of this chapter) is not contained herein, and will not
be contained, to the best of registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. x
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 ¨
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Accelerated
filer ¨
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Non-accelerated
filer ¨
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Smaller
reporting company x
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(Do
not check if a smaller reporting company)
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Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).
Yes No
x
State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
last sold, or the average bid and asked price of such common equity, as of the
last business day of the registrant’s most recently computed second fiscal
quarter. $600,000 based upon $.005 per share which was the last price
at which the common equity purchased by non-affiliates was last sold, since
there is no public bid or ask price.
The
number of shares of the issuer’s common stock issued and outstanding as
of April 13, 2010 was 124,745,000 shares.
Documents
Incorporated by Reference: Prospectus filed pursuant to Rule
424(b)(3) of the Act on February 19, 2008 (Registration No.
333-148910)
TABLE OF CONTENTS
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Page
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PART
I
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Item
1
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Business
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3
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Item
1A
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Risk
Factors
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5
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Item
1B
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Unresolved
Staff Comments
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6
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Item
2
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Properties
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6
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Item
3
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Legal
Proceedings
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6
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Item
4
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Removed
and Reserved
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6
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PART
II
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Item
5
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Market
for Registrant’s Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
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6
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Item
6
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Selected
Financial Data
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8
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Item
7
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operation
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8
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Item
7A
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Quantitative
and Qualitative Disclosures About Market Risk
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10
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Item
8
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Financial
Statements.
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Item
9
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Changes
in and Disagreements With Accountants on Accounting and Financial
Disclosure
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Item
9A
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Controls
and Procedures
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Item
9B
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Other
Information
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12
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PART
III
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Item
10
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Directors,
Executive Officers and Corporate Governance
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12
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Item
11
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Executive
Compensation
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13
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Item
12
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Security
Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
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14
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Item
13
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Certain
Relationships and Related Transactions, and Director
Independence
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16
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Item
14
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Principal
Accountant Fees and Services
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17
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PART
IV
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Item
15
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Exhibits,
Financial Statement Schedules
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18
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SIGNATURES
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19
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Item
1. Business.
As used
in this Annual Report on Form 10-K (this “Report”), references to the “Company,”
the “Registrant,” “we,” “our” or “us” refer to Adama Technologies Corporation.,
unless the context otherwise indicates.
Forward-Looking
Statements
This
Report contains forward-looking statements. For this purpose, any
statements contained in this Report that are not statements of historical fact
may be deemed to be forward-looking statements. Forward-looking
information includes statements relating to future actions, prospective
products, future performance or results of current or anticipated products,
sales and marketing efforts, costs and expenses, interest rates, outcome of
contingencies, financial condition, results of operations, liquidity, business
strategies, cost savings, objectives of management, and other
matters. You can identify forward-looking statements by those that
are not historical in nature, particularly those that use terminology such as
“may,” “will,” “should,” “expects,” “anticipates,” “contemplates,”
“estimates,” ”believes,” “plans,” “projected,” “predicts,”
“potential,” or “continue” or the negative of these similar
terms. The Private Securities Litigation Reform Act of 1995 provides
a “safe harbor” for forward-looking information to encourage companies to
provide prospective information about themselves without fear of litigation so
long as that information is identified as forward-looking and is accompanied by
meaningful cautionary statements identifying important factors that could cause
actual results to differ materially from those projected in the
information.
These
forward-looking statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that we cannot predict. In evaluating these
forward-looking statements, you should consider various factors, including the
following: (a) those risks and uncertainties related to general economic
conditions, (b) whether we are able to manage our planned growth efficiently and
operate profitable operations, (c) whether we are able to generate sufficient
revenues or obtain financing to sustain and grow our operations, (d) whether we
are able to successfully fulfill our primary requirements for cash, which are
explained below under “Liquidity and Capital Resources”. We assume no
obligation to update forward-looking statements, except as otherwise required
under the applicable federal securities laws.
HISTORY
OF OUR COMPANY
Adama
Technologies Corp. was incorporated in Delaware on September 19, 2007 and we are
a development stage company. On November 25, 2007 we executed an exclusive
worldwide patent-pending sale agreement with Mr. Eliezer Sheffer, the inventor
of a patent-pending technology (Patent Application Number: 11/720,518). We plan
to use said technology (security systems for mobile vehicles, trucks, and
shipping containers) to create a unique wireless data platform to support minute
by minute data transmissions. We completed a public offering of our
common stock in the first half of 2008, raising aggregate gross proceeds of
$90,000 pursuant to a registration statement on Form SB-2 that was declared
effective by the Securities and Exchange Commission on February 19,
2008. A private placement of common stock was completed on July 3,
2008, raising aggregate gross proceeds of $90,000 from 22
investors. On July 28, 2008 we implemented a 5 for 1 forward
stock split. On October 27, 2008 we executed an exclusive Brownfield
License Agreement with Solucorp Industries Ltd., pursuant to which we
acquired a 15 year license to certain environmental hazard remediation
technology.
On July
22, 2009, Mr. Gal Ilivitski resigned from his positions as an officer and as a
member of the Board. The Company is not aware of any disagreements between Mr.
Ilivitski and any other officer or director of the Company.
On July
22, 2009, the board of directors of the Company unanimously appointed Mr. Boaz
Benrush and Mr. Oren Bar-nir Gayer, as members of the Board and approved the
Agreement between the Company, on one hand and Mr. Boaz Benrush and Mr. Oren
Bar-nir Gayer, on the other hand (the “Agreement”), pursuant to which the Mr.
Boaz Benrush and Mr. Oren Bar-nir Gayer were appointed sole members of the board
of directors of Adama Technologies (Israel) Ltd., a wholly owned subsidiary of
the Company, which was established under the laws of Israel on June 22, 2009
(the “Subsidiary”).
Pursuant
to the Agreement, Mr. Benrush and Mr. Bar-nir Gayer were to perform the duties
specified therein in consideration for the issuance of an aggregate of
14,000,000 shares of the Company’s common stock, which constitutes 15.4% of the
Company’s issued and outstanding shares of common stock on a fully diluted basis
as of the date of the Agreement (the “Shares”), valued at $294,000,000 per share
on of the date of the grant. The issuances of the shares were to be made
pursuant to the Stock Incentive Plan (as defined below) and subject to Mr.
Benrush and Mr. Bar-nir Gayer achieving the milestones set forth in Section 2 of
the Agreement.
On July
22, 2009, the Company adopted the Adama Technologies Corporation 2009 Employee
Stock Incentive Plan (the “Stock Incentive Plan”), pursuant which the Company is
authorized to grant equity-based awards in the form of stock options, restricted
common stock, restricted stock units, stock appreciation rights, and other stock
based awards to employees (including executive officers), directors, consultants
and service provider of the Company and its subsidiaries. The maximum
number of shares available for grant under the plan is 25,000,000 shares of
common stock. The number of shares available for award under the plan
is subject to adjustment for certain corporate changes and based on the types of
awards provided, all in accordance with the provisions of the plan. The plan may
be administered by the Board.
With Mr.
Gal Ilivitski resignation as Secretary of the Registrant, on July 22, 2009, the
Board appointed Mr. Doron Latzer as Secretary, to serve at its
discretion.
On
October 1, 2009, the Board unanimously approved the Agreement between the
Company, on one hand and Mr. Boaz Benrush and Mr. Oren Bar-nir Gayer, on the
other hand (the “Termination Agreement”), pursuant to which the Mr. Boaz Benrush
and Mr. Oren Bar-nir Gayer resigned as members of the Board, from their
positions as directors of the Subsidiary, and from performing their business
development duties described in the Agreement.
Pursuant
to the Termination Agreement, the Company issued the 7,000,000, which were
divided equally between the Mr. Boaz Benrush and Mr. Oren Bar-nir Gayer. The
issuance of the 7,000,000 shares of our common stock was made pursuant to the
Stock Incentive Plan. In accordance with the Termination Agreement, the Shares
were issued to a trustee (the “Trustee”) on behalf of Mr. Benrush and Mr.
Bar-nir Gayer such shares are being held by the Trustee for the appropriate
holding period required by Section 102(b)(2) of the Israeli Income Tax Ordinance
(Capital Gain Option Through a Trustee) and subject to requirements of Rule 144
of the Securities Act of 1933, as amended. Mr. Boaz Benrush and Mr. Oren Bar-nir
Gayer granted all voting rights of the such shares to the Chairman of the
Board.
As a
result of the vacancies left by the resignations of Mr. Boaz Benrush and Mr.
Oren Bar-nir Gayer as members of the Board, on November 2, 2009, the Board has
appointed Mr. Benny Karasik to the Board, to serve until his successor is duly
appointed and qualified. On the same date, Asher Zwebner was elected
Chief Financial Officer and Principal Accounting Officer of the Company and
Benny Karasik was also elected Treasurer and Secretary of the Company, both to
serve at the discretion of the Board.
Our
Principal executive offices are located at 76/7 Zalman Shazar Street, Hod
Hasharon, Israel, in the home of Aviram Malik, our Chief Executive Officer and
President. Our registered office in Delaware is located at 113 Barksdale
Professional Center, Newark, DE 19711, and our registered agent is Delaware
Intercorp. Our fiscal year end is December 31.
Our
Business
On
October 27, 2008, the Company entered into an Exclusive Brownfield License
Agreement with Solucorp Industries Ltd. pursuant to which the Company
acquired a 15 year license to certain environmental hazard remediation
technology. The foundation of the license is its $60,000,000 patented MBS
(Molecular Bonding System) technology. The Company is to provide long-term
permanent solutions to hazardous heavy metal waste problems. The MBS
technology successfully treats all Resource Conservation & Recovery Act
(RCRA) and Universal Treatment Standards (UTS) metals such
as: arsenic, cadmium, chromium, lead, mercury, etc., and treats
multiple metals concurrently. The ability to treat difficult waste streams
along with being able to treat multiple metals with different solubility
points successfully separates our MBS technology from any other existing
technology. The types of applications include soils, sludge’s, ashes,
baghouse dusts and barrel wastes. The MBS technology provides superior
efficacy and has significant cost advantages over both hazardous waste
landfill and alternative remedial technology options.
In
consideration for the rights granted under the Exclusive Brownfield License
Agreement, the Company issued 8,890,000 shares of its common stock to Solucorp,
valued in the amount of $4,000,000. In addition, the sum of $1,000,000 was
payable to Solucorp within 12 months of October 27, 2008. As of December 31,
2009, the Company paid only $150,000 of the agreed sum. As of the date hereof,
the Company has not pay the remaining balance due as required by the Exclusive
Brownfield License Agreement. The Company is currently in negotiations with
Solucorp to extend the payment due date. If the Company fails to renegotiate the
payment due date with Solucorp, Solucorp has the right to sub-license the MBS
technology to other parties.
Employees
Other
than our current directors and officers, we have no other full time or part-time
employees. We do not foresee any significant changes in the number of employees
or consultants we will have over the next twelve months.
ITEM
1A. RISK FACTORS
Smaller
reporting companies are not required to provide the information called for by
this Item 1A.
ITEM
1B. UNRESOLVED STAFF COMMENTS.
None
ITEM
2. PROPERTIES.
Our
executive offices are located at 76/7 Zalman Shazar Street, Hod Hasharon,
Israel, in the home of Aviram Malik, our Chief Executive Officer and President.
We believe that this space is adequate for our current and immediately
foreseeable operating needs.
ITEM
3. LEGAL PROCEEDINGS.
There are
no pending legal proceedings to which the Company is a party or in which any
director, officer or affiliate of the Company, or any owner of record or
beneficially of more than 5% of any class of voting securities of the Company,
is a party adverse to the Company or has a material interest adverse to the
Company. The Company’s property is not the subject of any pending legal
proceedings.
ITEM
4. REMOVED AND RESERVED
PART
II
ITEM
5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES.
Market
Information
Our
common stock is eligible to be traded on the Over-The-Counter Bulletin Board,
under the ticker symbol ADAC. However, there has been very limited
trading in our common stock and there is no established trading market for our
common stock.
Holders
As of
April 13 2010, there were 124,745,000 shares of our common stock issued and
outstanding, which were held by 67 stockholders of record.
Dividends
We have
never declared or paid any cash dividends on our common stock nor do we
anticipate paying any in the foreseeable future. Furthermore, we expect to
retain any future earnings to finance our operations and expansion. The payment
of cash dividends in the future will be at the discretion of our Board of
Directors and will depend upon our earnings levels, capital requirements, any
restrictive loan covenants and other factors the Board considers
relevant.
Equity
Compensation Plans
On July
22, 2009, the Company adopted the Stock Incentive Plan, pursuant which the
Company is authorized to grant equity-based awards in the form of stock options,
restricted common stock, restricted stock units, stock appreciation rights, and
other stock based awards to employees (including executive officers), directors,
consultants and service provider of the Company and its subsidiaries. The
maximum number of shares available for grant under the plan is 25,000,000 shares
of common stock. The number of shares available for award under the
plan is subject to adjustment for certain corporate changes and based on the
types of awards provided, all in accordance with the provisions of the plan. The
plan may be administered by the Board. The Plan complies with the
provisions of Section 102(b)(2) of the Israeli Income Tax Ordinance (Capital
Gain Option Transaction Through a Trustee) and any rules and regulation
promulgated thereunder, including the Income Tax Rules (Tax Relief upon the
Allotment of Shares to Employee), 2008.
Recent
Sales of Unregistered Securities; Use of Proceeds from Registered
Securities
On May
11, 2009, the Company raised gross proceeds $250,000 and on August 8 raised
gross proceeds of $120,000 and issued 3,125,000 and 1,500,000 shares of its
common stock respectively at a purchase price of $0.08 per share
to non US Investors.
On June
2, 2009, the Company entered into a consulting agreement with Ran Novak, an
unrelated third-party, pursuant to which, Mr. Novak agreed to introduce the
Company to various potential strategic partners and potential customers for the
business of the license technology from Solucorp. In consideration
for such services, the Company issued 125,000 shares of its restricted common
stock, valued at $22,000.
On
September 16, 2009, the Company raised $120,000 and issued 1,500,000 shares of
its common stock, purchase price $0.08 per share, to an investor. The Company
received net proceeds of $120,000.
On
October 5, 2009, the Company entered into an agreement with unrelated
third-party consultants. As payment for the consultants’ services,
the Company issued 1,205,000 shares of its unregistered common stock valued at
$84,350.
On
October 5, 2009, the Company raised $35,000 and issued 750,000 shares of its
common stock, purchase price $0.047 per share, to an investor.
On
October 5, 2009, the Company entered into an agreement with a shareholder
consultant. As payment for the consultant’s services, the Company
issued 1,250,000 shares of its unregistered common stock on said date valued at
$58,750.
On
October 27, 2009, the Company issued as part of the termination agreement of a
Director Mr. Boaz Benrush and of Mr. Oren Bar-nir Gayer
3,500,000 shares to each , of its unregistered common stock on said date valued
at $147,000 to each .
On
December 1, 2009, the Company entered into an agreement with an unrelated
third-party consultant. As payment for the consultant’s services, the
Company issued 500,000 shares of its unregistered common stock on said date
valued at $7,000.
The
transactions referred to in this section are exempt from registration pursuant
to an exemption from registration provided by Regulation S of the Securities Act
of 1933, as amended. All proceeds were used to fund our operation.
ITEM
6. SELECTED FINANCIAL DATA.
Smaller
reporting companies are not required to provide disclosure pursuant to this Item
6.
ITEM
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
We are a
development stage company and have not generated any revenues to
date. We have acquired a license to certain technology that may be
used in wireless data systems. Although we have not yet engaged a manufacturer
to develop and implement a strategic marketing plan for bringing our product to
global markets, based on our preliminary discussions with certain manufacturing
vendors we believe that it will take approximately three to four months to
construct a basic marketing strategy. If and when we have a viable strategy,
depending on the availability of funds, we estimate that we would need
approximately an additional four to six months to bring this product to market.
Our objective is to manufacture the product through third party sub-contractors
and market the product ourselves, and/or to license the manufacturing rights and
related technology to third party manufacturers who would then assume
responsibility for marketing and sales.
We have
also acquired a non-exclusive license to certain technology used in the
remediation of contaminated sites, pursuant to our agreement with Solucorp
Industries Ltd. dated October 27, 2008.
Results
of Operations
We are a
development stage company and have not generated any revenues to
date. Our expenses in the year ended December 31, 2009 amounted to
$5,779,341, as compared to $160,364 for the year ended December 31, 2008 and
$5,944,823 for in the period from September 17, 2007 (inception) to December 31,
2009. Expenses in 2009 included $33,484 in professional fees,
incurred in connection with fulfilling our SEC reporting requirements,
consulting fees in the amount of $729,115, $1,551 in travel expenses, and
$249,999 in amortization relating the environmental hazard remediation
technology license that we acquired from Solucorp Industries on October 27,
2008, and $10,747 of miscellaneous other expenses. The Company incurred a one
time cost of $4,754,445 relating to an impariment loss of its acquired
technology during
the fourth quarter of 2009. During 2008 our expenses included
$47,534 in professional fees, incurred in connection with the preparation of our
financial statements and reports to the SEC and the registration of our common
stock on Form SB-2, $27,000 in consulting fees, $16,339 in travel expenses,
$55,556 in amortization relating to the environmental hazard remediation
technology license, $4,520 in rent expenses and $9,415 of miscellaneous other
expenses.
Our net
loss in the year ended December 31, 2009, which includes foreign currency
transaction expenses of $812 amounted to $5,780,153 as compared to $160,515
during the year ended December 31, 2008.
The
amounts presented in the financial statements do not provide for the effect of
inflation on the Company’s operations or its financial position. Amounts shown
for machinery, equipment, and leasehold improvements and for costs and expenses
reflect historical cost and do not necessarily represent replacement cost. The
net operating losses shown would be greater than reported if the effects of
inflation were reflected either by charging operations with amounts that
represent replacement costs or by using other inflation
adjustments.
Liquidity
and Capital Resources
We had
$83 in cash at December 31, 2009, as compared to cash in the amount of $643 on
December 31, 2008.
There
is not enough cash on hand to fund our administrative and other operating
expenses or our proposed research and development program for the next twelve
months, and we do not anticipate that we will generate any revenues from
operations for the next twelve months. In addition, on October 27,
2008 we assumed an obligation to pay Solucorp Industries Ltd. $1 million,
including $100,000 that was payable in November 2008. As of December 31, 2009,
the Company has paid $150,000 of the agreed sum. As of the date hereof, the
Company did not pay the remaining balance due as required by the Exclusive
Brownfield License Agreement. The Company is in negotiations to extend the
payment due date. If the Company does not adhere to its commitment, Solucorp has
the right to sub-license the MBS technology to other entities. In order to meet
our obligations to Solucorp Industries and to fund the development and marketing
of our planned wireless data systems, we will require significant new funding
which may be in the form of loans from current stockholders and/or from public
and private equity offerings.
We do not
currently have any arrangements or understandings with any person regarding
future equity or debt financing.
Our
auditors have issued an opinion on our financial statements which includes a
statement describing our going concern status. This means that there is
substantial doubt that we can continue as an on-going business for the next
twelve months, unless we obtain additional capital to pay our bills and meet our
other financial obligations. This is because we have not generated any revenues
and no revenues are anticipated until we begin marketing the product.
Accordingly, we must raise capital from sources other than the actual sale of
the product to implement our plan of operations and stay in
business.
Lack
of Insurance
The
Company currently has no insurance in force for its office facilities and
operations and it cannot be certain that it can cover the risks associated with
such lack of insurance or that it will be able to obtain and/or maintain
insurance to cover these risks at economically feasible premiums.
Going
Concern Consideration
The
accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America, which
contemplate continuation of the Company as a going concern. The Company has not
established any source of revenue to cover its operating costs, and as such, has
incurred an operating loss since inception. Further, as of December 31, 2009,
the cash resources of the Company were insufficient to meet its current business
plan, and the Company had negative working capital. These and other factors
raise substantial doubt about the Company’s ability to continue as a going
concern. The accompanying financial statements do not include any adjustments to
reflect the possible future effects on the recoverability and classification of
assets or the amounts and classification of liabilities that may result from the
possible inability of the Company to continue as a going concern.
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 are material to investors.
ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK.
Smaller
reporting companies are not required to provide disclosure pursuant to this Item
7A.
ITEM
8. FINANCIAL STATEMENTS.
The
financial statements and supplementary financial information required by this
Item are set forth immediately following the signature page and are incorporated
herein by reference.
(A
DEVELOPMENT STAGE COMPANY)
INDEX
TO FINANCIAL STATEMENTS
DECEMBER
31, 2009
Report
of Registered Independent Auditor
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F-2 |
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Financial
Statements-
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Balance
Sheets as of December 31, 2009 and December 31, 2008
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F-3 |
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Statements
of Operations for the Years Ended
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December
31, 2009 and 2008 and Cumulative from Inception
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F-4 |
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Statement
of Stockholders’ Equity (Deficit) for the Period from
Inception
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Through
December 31, 2009
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F-5 |
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Statements
of Cash Flows for Years Ended December 31, 2009 and 2008
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and
Cumulative from Inception
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F-6 |
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Notes
to Financial Statements
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F-7 |
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REPORT
OF REGISTERED INDEPENDENT AUDITORS
To the
Board of Directors and Stockholders
of Adama
Technologies Corp.:
We have
audited the accompanying balance sheets of Adama Technologies Corp. (a Delaware
corporation in the development stage) as of December 31, 2009 and 2008, and the
related statements of operations, stockholders’ equity, and cash flows for years
ended December 31, 2009 and 2008, and from inception (September 17, 2007)
through December 31, 2009. 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 standards of the Public Company
Accounting Oversight Board (United States of America). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. The Company is not
required to have, nor were we engaged to perform, an audit of its internal
control over financial reporting. Our audit included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control over financial
reporting. Accordingly, we express no such opinion. 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 Adama Technologies Corp. as of
December 31, 2009 and 2008, and the results of its operations and its cash flows
for the years ended December 31, 2009 and 2008, and from inception (September
17, 2007) through December 31, 2009, in conformity with accounting principles
generally accepted in the United States of America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company is in the development stage, and has not established any
source of revenue to cover its operating costs. As such, it has incurred an
operating loss since inception. Further, as of December 31, 2009, the cash
resources of the Company were insufficient to meet its planned business
objectives. These and other factors raise substantial doubt about the Company’s
ability to continue as a going concern. Management’s plan regarding these
matters is also described in Note 2 to the financial statements. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Respectfully
submitted,
/s/
Weinberg & Baer LLC
Weinberg
& Baer LLC
Baltimore,
Maryland
April 13,
2010
ADAMA
TECHNOLOGIES CORP.
(A
DEVELOPMENT STAGE COMPANY)
BALANCE
SHEETS
AS
OF DECEMBER 31, 2009 AND DECEMBER 31, 2008
|
|
As
of
|
|
|
As
of
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
|
2009
|
|
|
2008
|
|
ASSETS
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
Cash
in bank
|
|
$ |
83 |
|
|
$ |
643 |
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
|
|
83 |
|
|
|
643 |
|
|
|
|
|
|
|
|
|
|
Other
Assets:
|
|
|
|
|
|
|
|
|
Acquired
technology, net of $55,556 amortization
|
|
|
- |
|
|
|
4,944,444 |
|
Patent
pending
|
|
|
- |
|
|
|
60,000 |
|
|
|
|
|
|
|
|
|
|
Total
other assets
|
|
|
- |
|
|
|
5,004,444 |
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
$ |
83 |
|
|
$ |
5,005,087 |
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
|
|
|
Accrued
liabilities
|
|
$ |
22,000 |
|
|
$ |
10,061 |
|
Acquired
technology obligation
|
|
|
850,000 |
|
|
|
1,000,000 |
|
Loans
from related parties - Directors and stockholders
|
|
|
93,283 |
|
|
|
4,959 |
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
|
|
965,283 |
|
|
|
1,015,020 |
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
965,283 |
|
|
|
1,015,020 |
|
|
|
|
|
|
|
|
|
|
Commitments
and Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
Common
stock, par value $.0001 per share, 200,000,000 shares authorized;
89,345,000 and 73,890,000 shares issued and outstanding, respectively
|
|
|
8,935 |
|
|
|
7,389 |
|
Additional
paid-in capital |
|
|
4,974,451 |
|
|
|
4,151,111 |
|
Discount
on common stock
|
|
|
(2,800 |
) |
|
|
(2,800 |
) |
(Deficit)
accumulated during the development stage
|
|
|
(5,945,786 |
) |
|
|
(165,633 |
) |
|
|
|
|
|
|
|
|
|
Total
stockholders' equity
|
|
|
(965,200 |
) |
|
|
3,990,067 |
|
|
|
|
|
|
|
|
|
|
Total
Liabilities and Stockholders' Equity
|
|
$ |
83 |
|
|
$ |
5,005,087 |
|
The
accompanying notes to financial statements are
an
integral part of these financial statements.
ADAMA
TECHNOLOGIES CORP.
(A
DEVELOPMENT STAGE COMPANY)
STATEMENTS
OF OPERATIONS
FOR
THE YEARS ENDED DECEMBER 31, 2009 AND 2008,
AND
CUMULATIVE FROM INCEPTION (SEPTEMBER 17, 2007)
THROUGH
DECEMBER 31, 2009
|
|
Year
|
|
|
Year
|
|
|
|
|
|
|
Ended
|
|
|
Ended
|
|
|
Cumulative
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
From
|
|
|
|
2009
|
|
|
2008
|
|
|
Inception
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
General
and administrative-
|
|
|
|
|
|
|
|
|
|
|
|
|
Professional
fees
|
|
|
33,484 |
|
|
|
47,534 |
|
|
|
83,768 |
|
Legal
- incorporation
|
|
|
- |
|
|
|
- |
|
|
|
2,200 |
|
Consulting
|
|
|
729,115 |
|
|
|
27,000 |
|
|
|
756,115 |
|
Travel
|
|
|
1,551 |
|
|
|
16,339 |
|
|
|
17,890 |
|
Amortization
|
|
|
249,999 |
|
|
|
55,556 |
|
|
|
305,555 |
|
Rent
|
|
|
- |
|
|
|
4,520 |
|
|
|
4,520 |
|
Impairment
loss
|
|
|
4,754,445 |
|
|
|
|
|
|
|
4,754,445 |
|
Other
|
|
|
10,747 |
|
|
|
9,415 |
|
|
|
20,330 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
general and administrative expenses
|
|
|
5,779,341 |
|
|
|
160,364 |
|
|
|
5,944,823 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
from Operations
|
|
|
(5,779,341 |
) |
|
|
(160,364 |
) |
|
|
(5,944,823 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Income (Expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency transaction expenses
|
|
|
(812 |
) |
|
|
(151 |
) |
|
|
(963 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(Loss)
|
|
$ |
(5,780,153 |
) |
|
$ |
(160,515 |
) |
|
$ |
(5,945,786 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
Per Common Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)
per common share - Basic and Diluted
|
|
$ |
(0.07 |
) |
|
$ |
(0.00 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Number of Common Shares Outstanding - Basic and
Diluted
|
|
|
78,364,890 |
|
|
|
51,808,219 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes to financial statements are
an
integral part of these statements.
ADAMA
TECHNOLOGIES CORP.
(A
DEVELOPMENT STAGE COMPANY)
STATEMENT
OF STOCKHOLDERS’ EQUITY
FOR
THE PERIOD FROM INCEPTION (SEPTEMBER 17, 2007)
THROUGH
DECEMBER 31, 2009
|
|
|
|
|
|
|
|
Additional
|
|
|
Discount
on
|
|
|
(Deficit)
Accumulated
During the
|
|
|
|
|
|
|
Common
stock
|
|
|
Paid-in
|
|
|
Common
|
|
|
Development
|
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Stock
|
|
|
Stage
|
|
|
Totals
|
|
Balance
- September 17, 2007
|
|
|
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
35,000,000 |
|
|
|
3,500 |
|
|
|
- |
|
|
|
(2,800 |
) |
|
|
- |
|
|
|
700 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss) for the period
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(5,118 |
) |
|
|
(5,118 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
- December 31, 2007
|
|
|
35,000,000 |
|
|
$ |
3,500 |
|
|
$ |
- |
|
|
$ |
(2,800 |
) |
|
$ |
(5,118 |
) |
|
$ |
(4,418 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
15,000,000 |
|
|
|
1,500 |
|
|
|
64,700 |
|
|
|
- |
|
|
|
- |
|
|
|
66,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
15,000,000 |
|
|
|
1,500 |
|
|
|
87,300 |
|
|
|
- |
|
|
|
- |
|
|
|
88,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for acquired technology
|
|
|
8,890,000 |
|
|
|
889 |
|
|
|
3,999,111 |
|
|
|
- |
|
|
|
- |
|
|
|
4,000,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss) for the year
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(160,515 |
) |
|
|
(160,515 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
- December 31, 2008
|
|
|
73,890,000 |
|
|
|
7,389 |
|
|
|
4,151,111 |
|
|
|
(2,800 |
) |
|
|
(165,633 |
) |
|
|
3,990,067 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
3,125,000 |
|
|
|
313 |
|
|
|
203,473 |
|
|
|
- |
|
|
|
- |
|
|
|
203,786 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
125,000 |
|
|
|
13 |
|
|
|
21,988 |
|
|
|
- |
|
|
|
- |
|
|
|
22,001 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
1,500,000 |
|
|
|
150 |
|
|
|
119,850 |
|
|
|
- |
|
|
|
- |
|
|
|
120,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
1,205,000 |
|
|
|
121 |
|
|
|
84,230 |
|
|
|
- |
|
|
|
- |
|
|
|
84,350 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued for cash
|
|
|
750,000 |
|
|
|
75 |
|
|
|
34,925 |
|
|
|
- |
|
|
|
- |
|
|
|
35,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
1,250,000 |
|
|
|
125 |
|
|
|
58,625 |
|
|
|
- |
|
|
|
- |
|
|
|
58,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
3,500,000 |
|
|
|
350 |
|
|
|
146,650 |
|
|
|
- |
|
|
|
- |
|
|
|
147,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
3,500,000 |
|
|
|
350 |
|
|
|
146,650 |
|
|
|
- |
|
|
|
- |
|
|
|
147,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
500,000 |
|
|
|
50 |
|
|
|
6,950 |
|
|
|
- |
|
|
|
- |
|
|
|
7,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss) for the year
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(5,780,153 |
) |
|
|
(5,780,153 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
- December 31, 2009
|
|
|
89,345,000 |
|
|
$ |
8,935 |
|
|
$ |
4,974,452 |
|
|
$ |
(2,800 |
) |
|
$ |
(5,945,786 |
) |
|
$ |
(965,200 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes to financial statements are
an
integral part of these statements.
ADAMA
TECHNOLOGIES CORP.
(A
DEVELOPMENT STAGE COMPANY)
STATEMENTS
OF CASH FLOWS
FOR
THE YEARS ENDED DECEMBER 31, 2009 AND 2008,
AND
CUMULATIVE FROM INCEPTION (SEPTEMBER 17, 2007)
THROUGH
DECEMBER 31, 2009
|
|
Year
Ended
December
31,
2009
|
|
|
Year
Ended
December
31,
2008
|
|
|
Cumulative
From Inception
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
|
Net
(loss)
|
|
$ |
(5,780,153 |
) |
|
$ |
(160,515 |
) |
|
$ |
(5,945,786 |
) |
Adjustments
to reconcile net (loss) to net cash (used in) operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock issued as compensation
|
|
|
466,101 |
|
|
|
- |
|
|
|
466,101 |
|
Impairment
loss
|
|
|
4,754,445 |
|
|
|
- |
|
|
|
4,754,445 |
|
Amortization
|
|
|
249,999 |
|
|
|
55,556 |
|
|
|
305,555 |
|
Changes
in net assets and liabilities-
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued
liabilites
|
|
|
11,939 |
|
|
|
(20,939 |
) |
|
|
22,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Used in Operating Activities
|
|
|
(297,670 |
) |
|
|
(125,898 |
) |
|
|
(397,686 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
and costs of intangible assets
|
|
|
(150,000 |
) |
|
|
- |
|
|
|
(210,000 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Used in Investing Activities
|
|
|
(150,000 |
) |
|
|
- |
|
|
|
(210,000 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred
offering costs
|
|
|
- |
|
|
|
(25,000 |
) |
|
|
(25,000 |
) |
|
|
|
358,786 |
|
|
|
180,000 |
|
|
|
539,486 |
|
Loans
from related parties - Directors and stockholders
|
|
|
88,324 |
|
|
|
(34,341 |
) |
|
|
93,283 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Cash Provided by Financing Activities
|
|
|
447,110 |
|
|
|
120,659 |
|
|
|
607,769 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(Decrease) Increase in Cash
|
|
|
(560 |
) |
|
|
(5,239 |
) |
|
|
83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
- Beginning of Period
|
|
|
643 |
|
|
|
5,882 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
- End of Period
|
|
$ |
83 |
|
|
$ |
643 |
|
|
$ |
83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosure of Cash Flow Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
paid during the period for:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
Income
taxes
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of common stock for acquired technology
|
|
$ |
- |
|
|
$ |
4,000,000 |
|
|
$ |
4,000,000 |
|
Obligation
payable for acquired technology
|
|
$ |
- |
|
|
$ |
1,000,000 |
|
|
$ |
850,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes to financial statements are
an
integral part of these statements.
ADAMA
TECHNOLOGIES CORP.
(A
DEVELOPMENT STAGE COMPANY)
NOTES
TO FINANCIAL STATEMENTS
(1) Summary of Significant Accounting
Policies
Basis
of Presentation and Organization
Adama
Technologies Corp. (“Adama Technologies” or the “Company”) is a Delaware
corporation in the development stage and has not commenced operations. The
Company was incorporated under the laws of the State of Delaware on September
17, 2007. The business plan of the Company is to develop a commercial
application of the design in a patent pending of a “Security system for mobile
vehicles, trucks and shipping containers”, which is a device intended to provide
security for mobile entities. The Company also intends to enhance the existing
prototype, obtain approval of its patent application, and manufacture and market
the product and/or seek third party entities interested in licensing the rights
to manufacture and market the device. The accompanying financial statements of
Adama Technologies were prepared from the accounts of the Company under the
accrual basis of accounting.
The
Company commenced a capital formation activity to submit a Registration
Statement on Form SB-2 to the Securities and Exchange Commissions (“SEC”) to
register and sell in a self-directed offering 15,000,000 (post forward stock
split) shares of newly issued common stock at an offering price of $0.03 for
proceeds of up to $90,000. The Registration Statement on Form SB-2 was filed
with the SEC on January 29, 2008 and declared effective on February 19, 2008. As
of May 19, 2008, the Company issued 15,000,000 (post forward stock split) shares
of common stock pursuant to the Registration Statement on Form SB-2, and
deposited proceeds of $90,000.
Cash and Cash
Equivalents
For
purposes of reporting within the statement of cash flows, the Company considers
all cash on hand, cash accounts not subject to withdrawal restrictions or
penalties, and all highly liquid debt instruments purchased with a maturity of
three months or less to be cash and cash equivalents.
Revenue
Recognition
The
Company is in the development stage and has yet to realize revenues from
operations. Once the Company has commenced operations, it will recognize
revenues when delivery of goods or completion of services has occurred provided
there is persuasive evidence of an agreement, acceptance has been approved by
its customers, the fee is fixed or determinable based on the completion of
stated terms and conditions, and collection of any related receivable is
probable.
Loss
per Common Share
Basic
loss per share is computed by dividing the net loss attributable to the common
stockholders by the weighted average number of shares of common stock
outstanding during the period. Fully diluted loss per share is computed similar
to basic loss per share except that the denominator is increased to include the
number of additional common shares that would have been outstanding if the
potential common shares had been issued and if the additional common shares were
dilutive. There were no dilutive financial instruments issued or outstanding for
the period ended December 31, 2009.
Income
Taxes
Deferred
tax assets and liabilities are determined based on temporary differences between
the bases of certain assets and liabilities for income tax and financial
reporting purposes. The deferred tax assets and liabilities are classified
according to the financial statement classification of the assets and
liabilities generating the differences.
The
Company maintains a valuation allowance with respect to deferred tax assets. The
Company establishes a valuation allowance based upon the potential likelihood of
realizing the deferred tax asset and taking into consideration the Company’s
financial position and results of operations for the current period. Future
realization of the deferred tax benefit depends on the existence of sufficient
taxable income within the carryforward period under the federal tax
laws.
Changes
in circumstances, such as the Company generating taxable income, could cause a
change in judgment about the realizability of the related deferred tax asset.
Any change in the valuation allowance will be included in income in the year of
the change in estimate.
Fair
Value of Financial Instruments
The
Company estimates the fair value of financial instruments using the available
market information and valuation methods. Considerable judgment is required in
estimating fair value. Accordingly, the estimates of fair value may not be
indicative of the amounts the Company could realize in a current market
exchange. As of December 31, 2009, the carrying value of accrued liabilities,
and loans from directors and stockholders approximated fair value due to the
short-term nature and maturity of these instruments.
Patent
and Intellectual Property
The
Company capitalizes the costs associated with obtaining a Patent or other
intellectual property associated with its intended business plan. Such costs are
amortized over the estimated useful lives of the related assets.
Deferred
Offering Costs
The
Company defers as other assets the direct incremental costs of raising capital
until such time as the offering is completed. At the time of the completion of
the offering, the costs are charged against the capital raised. Should the
offering be terminated, deferred offering costs are charged to operations during
the period in which the offering is terminated.
Impairment
of Long-Lived Assets
The Company evaluates the
recoverability of long-lived assets and the related estimated remaining lives
when events or circumstances lead management to believe that the carrying value
of an asset may not be recoverable.
Common
Stock Registration Expenses
The
Company considers incremental costs and expenses related to the registration of
equity securities with the SEC, whether by contractual arrangement as of a
certain date or by demand, to be unrelated to original issuance transactions. As
such, subsequent registration costs and expenses are expensed as
incurred.
Estimates
The
financial statements are prepared on the basis of accounting principles
generally accepted in the United States. The preparation of financial statements
in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities as of September 30, 2009, and expenses for the period ended
September 30, 2009, and cumulative from inception. Actual results could differ
from those estimates made by management.
Recent Accounting
Pronouncements
The
Company adopted an accounting standard update regarding the determination of the
useful life of intangible assets. As codified in ASC 350-30-35, this update
amends the factors considered in developing renewal or extension assumptions
used to determine the useful life of a recognized intangible asset under
intangibles accounting. It also requires a consistent approach between the
useful life of a recognized intangible asset under prior business combination
accounting and the period of expected cash flows used to measure the fair value
of an asset under the new business combinations accounting (as currently
codified under ASC 850). The update also requires enhanced disclosures when an
intangible asset’s expected future cash flows are affected by an entity’s intent
and/or ability to renew or extend the arrangement. The adoption did not have a
material impact on the Company’s financial statements.
The
Company adopted a new accounting standard for subsequent events, as codified in
ASC 855-10. The update modifies the names of the two types of subsequent events
either as recognized subsequent events (previously referred to in practice as
Type I subsequent events) or non-recognized subsequent events (previously
referred to in practice as Type II subsequent events). In addition, the standard
modifies the definition of subsequent events to refer to events or transactions
that occur after the balance sheet date, but before the financial statements are
issued (for public entities). The update did not result in significant changes
in the practice of subsequent event disclosures, and therefore the adoption did
not have a material impact on the Company’s financial statements.
The
Company adopted the Financial Accounting Standards Board (“FASB”) Accounting
Standards Codification (“ASC”) 105-10, Generally Accepted Accounting
Principles – Overall (“ASC 105-10”). ASC 105-10 establishes the FASB Accounting Standards
Codification (the “Codification”) as the source of authoritative
accounting principles recognized by the FASB to be applied by nongovernmental
entities in the preparation of financial statements in conformity with U.S.
GAAP. Rules and interpretive releases of the SEC under authority of federal
securities laws are also sources of authoritative U.S. GAAP for SEC registrants.
All guidance contained in the Codification carries an equal level of authority.
The Codification superseded all existing non-SEC accounting and reporting
standards. All other non-grandfathered, non-SEC accounting literature not
included in the Codification is non-authoritative. The FASB will not issue new
standards in the form of Statements, FASB Staff Positions or Emerging Issues
Task Force Abstracts. Instead, it will issue Accounting Standards Updates
(“ASUs”). The FASB will not consider ASUs as authoritative in their own right.
ASUs will serve only to update the Codification, provide background information
about the guidance and provide the bases for conclusions on the change(s) in the
Codification. References made to FASB guidance throughout this document have
been updated for the Codification.
The
Company adopted FASB ASU No. 2009-05, Fair Value Measurements and
Disclosures (Topic 820) (“ASU 2009-05”). ASU 2009-05 provided amendments
to ASC 820-10, Fair Value
Measurements and Disclosures – Overall, for the fair value measurement of
liabilities. ASU 2009-05 provides clarification that in circumstances in which a
quoted price in an active market for the identical liability is not available, a
reporting entity is required to measure fair value using certain techniques. ASU
2009-05 also clarifies that when estimating the fair value of a liability, a
reporting entity is not required to include a separate input or adjustment to
other inputs relating to the existence of a restriction that prevents the
transfer of a liability. ASU 2009-05 also clarifies that both a quoted price in
an active market for the identical liability at the measurement date and the
quoted price for the identical liability when traded as an asset in an active
market when no adjustments to the quoted price of the asset are required are
Level 1 fair value measurements. Adoption of ASU 2009-05 did not have a material
impact on the Company’s results of operations or financial
condition.
(2) Development Stage Activities and
Going Concern
The
Company is currently in the development stage, and has no operations. The
business plan of the Company is to develop a commercial application of the
design in a patent pending of a “Security system for mobile vehicles, trucks and
shipping containers” which is a device intended to provide security for mobile
entities. The Company also intends to enhance the existing prototype, obtain
approval of its patent application, and manufacture and market the product
and/or seek third party entities interested in licensing the rights to
manufacture and market the device.
The
accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America, which
contemplate continuation of the Company as a going concern. The Company has not
established any source of revenue to cover its operating costs, and as such, has
incurred an operating loss since inception. Further, as of December 31, 2009,
the cash resources of the Company were insufficient to meet its current business
plan, and the Company had negative working capital. These and other factors
raise substantial doubt about the Company’s ability to continue as a going
concern. The accompanying financial statements do not include any adjustments to
reflect the possible future effects on the recoverability and classification of
assets or the amounts and classification of liabilities that may result from the
possible inability of the Company to continue as a going concern.
(3) Patent Pending
In
November 2007, the Company entered into an Invention Assignment Agreement with
Eliezer Sheffer, the inventor, whereby the Company acquired from Eliezer Sheffer
all of the right, title and interest in the Invention known as the “Security
system for mobile vehicles, trucks and shipping containers” for consideration of
$60,000. Under the terms of the Assignment Agreement, the Company was assigned
rights to the Invention free of any liens, claims, royalties, licenses, security
interests or other encumbrances. The inventor of the Invention is not an officer
or director of the Company, nor an investor or promoter of such. The Invention
is the subject of United States Patent Application 11/720,518 which was filed
with the United States Patent and Trademark Office on May 31, 2007. Currently,
the Patent Application is pending. The historical cost of obtaining the
Invention and filing for the patent has been capitalized by the Company, and
amounted to $60,000. If the Patent is granted to the Company, the historical
cost of the Patent will be amortized over its useful life, which is estimated to
be 17 years.
As of
December 31, 2009, the Company recorded an impairment loss for the full value of
the patent.
(4) Acquired
Technology
On
October 27, 2008, the Company entered into an Exclusive Brownfield License
Agreement with Solucorp Industries Ltd. Pursuant to the terms of the
Agreement, Solucorp granted the Company an exclusive worldwide license of its
MBS Process, for remediating Brownfield and Redevelopment Sites, with the
exception of North America, Central America, South America, Russia and China.
The Company was also granted a non-exclusive license for use of the MBS Process
for the remediation of contaminated sites and superfunded like sites. The term
of the Agreement is 15 years.
As of
December 31, 2009, the Company recorded an impairment loss for the full value of
the acquired technology.
In
consideration for the rights granted under the Agreement, the Company issued
8,890,000 shares of its common stock to Solucorp, valued in the amount of
$4,000,000. In addition, the sum of $1,000,000 is payable to Solucorp
within 12 months of October 27, 2008 according to an amendment to the original
agreement.
As of
December 31, 2009 the Company has paid $150,000 of the agreed sum.
In the
event the Company sells or develops the Brownfield or Redevelopment
property after remediation, the Company shall pay 1% of the royalty of such
sale or redevelopment cost to Solucorp.
(5) Common Stock
On November 13, 2007, the Company
issued 35,000,000 shares (post forward stock split) of its common stock to seven
individuals who are founders of the Company, including the Company’s initial
Directors and officers, for proceeds of $700.
The
Company commenced a capital formation activity to submit a Registration
Statement on Form SB-2 to the SEC to register and sell 15,000,000 (post forward stock
split) shares of newly issued common stock in a self-directed offering at an
offering price of $0.03 per share for proceeds of up to $90,000. As of May 19,
2008, the Company had incurred $25,000 of deferred offering costs related to
this capital formation activity. As of May 19, 2008, the Company issued
15,000,000 (post
forward stock split) shares of common stock pursuant to the Registration
Statement on Form SB-2, and deposited proceeds of $90,000.
On July
3, 2008, the Company raised $90,000 and issued 3,000,000 shares of its common
stock, purchase price $0.03 per share, to 22 investors. The Company received net
proceeds of $88,800.
On July
28, 2008, the Company implemented a 5 for 1 forward stock split on its
issued and outstanding shares of common stock to the holders of record as of
July 25, 2008. As a result of the split, each holder of record on the record
date automatically received four additional shares of the Company’s common
stock. After the split, the number of shares of common stock issued and
outstanding are 65,000,000 shares. The accompanying financial statements and
related notes thereto have been adjusted accordingly to reflect this forward
stock split.
On
October 27, 2008, the Company entered into an Exclusive Brownfield License
Agreement with Solucorp Industries Ltd. In consideration for the rights granted
under the Agreement, the Company issued 8,890,000 shares of its common stock to
Solucorp, valued in the amount of $4,000,000.
On May
11, 2009, the Company raised $250,000 and issued 3,125,000 shares of its common
stock, purchase price $0.08 per share, to an investor. The Company received net
proceeds of $203,786.
On June
2, 2009, the Company entered into an agreement with an unrelated third-party
consultant. As payment for the consultant’s services, the Company
issued 125,000 shares of its unregistered common stock on said date valued at
$22,000.
On
September 16, 2009, the Company raised $120,000 and issued 1,500,000 shares of
its common stock, purchase price $0.08 per share, to an investor. The Company
received net proceeds of $120,000.
On
October 5, 2009, the Company entered into an agreement with an unrelated
third-party consultants. As payment for the consultants’ services,
the Company issued 1,205,000 shares of its unregistered common stock valued at
$84,350.
On
October 5, 2009, the Company raised $35,000 and issued 750,000 shares of its
common stock, purchase price $0.047 per share, to an investor.
On
October 5, 2009, the Company entered into an agreement with a shareholder
consultant. As payment for the consultant’s services, the Company
issued 1,250,000 shares of its unregistered common stock on said date valued at
$58,750.
On
October 27, 2009, the Company issued as part of the termination agreement of a
Director Mr. Boaz Benrush and of Mr. Oren Bar-nir Gayer
3,500,000 shares to each , of its unregistered common stock on said date valued
at $147,000 to each.
On
December 1, 2009, the Company entered into an agreement with an unrelated
third-party consultant. As payment for the consultant’s services, the
Company issued 500,000 shares of its unregistered common stock on said date
valued at $7,000.
(6) Income Taxes
The
provision (benefit) for income taxes for the period ended December 31, 2009 and
2008, was as follows (assuming a 23% effective tax rate):
|
|
2009
|
|
|
2008
|
|
Current
Tax Provision:
|
|
|
|
|
|
|
Federal-
|
|
|
|
|
|
|
Taxable
income
|
|
$ |
- |
|
|
$ |
- |
|
Total
current tax provision
|
|
$ |
- |
|
|
$ |
- |
|
Deferred
Tax Provision:
|
|
|
|
|
|
|
|
|
Federal-
|
|
|
|
|
|
|
|
|
Loss
carryforwards
|
|
$ |
1,329,435 |
|
|
$ |
36,918 |
|
Change
in valuation allowance
|
|
|
(1,329,435 |
) |
|
|
(36,918 |
) |
Total
deferred tax provision
|
|
$ |
- |
|
|
$ |
- |
|
The
Company had deferred income tax assets as of December 31, 2009 and 2008, as
follows:
|
|
2009
|
|
|
2008
|
|
Loss
carryforwards
|
|
$ |
1,367,531 |
|
|
$ |
38,096 |
|
Less
- Valuation allowance
|
|
|
(1,367,531 |
) |
|
|
(38,096 |
) |
Total
net deferred tax assets
|
|
$ |
- |
|
|
$ |
- |
|
The
Company provided a valuation allowance equal to the deferred income tax assets
for the period ended December 31, 2009, because it is not presently known
whether future taxable income will be sufficient to utilize the loss
carryforwards.
As of
December 31, 2009, the Company had approximately $5,945,786 in tax loss
carryforwards that can be utilized in future periods to reduce taxable income,
and expire through the year 2029.
(7) Related Party
Transactions
On
November 20, 2007, the Company subscribed 7,525,000 shares (post forward stock
split) of common stock to Mr. Aviram Malik, President and Director, for a cash
payment of $150.
On
November 20, 2007, the Company subscribed 2,500,000 shares (post forward stock
split) of common stock to Mr. Gal Ilivitzki, Secretary and Director, for a cash
payment of $50.
During
the year ending December 31, 2009, the Company paid consulting fees in the
amount of $107,234 to Directors and officers of the Company.
(8)
Commitment and Contingencies
As
discussed in Note 4, on October 27, 2008, the Company entered into an Exclusive
Brownfield License Agreement with Solucorp Industries Ltd. In consideration for
the rights granted under the Agreement, the Company issued 8,890,000 shares of
its common stock to Solucorp, valued in the amount of $4,000,000. In addition,
the sum of $1,000,000 is payable to Solucorp within 12 months of October
27, 2008, according to an amendment to the original agreement.
As of
December 31, 2009, the Company has paid $150,000 of the agreed sum.
In the
event the Company sells or develops the Brownfield or Redevelopment
property after remediation, the Company shall pay 1% of the royalty of such
sale or redevelopment cost to Solucorp.
(9)
Events Subsequent to the Balance Sheet Date
The
Company did not pay the remaining balance due as required by the Exclusive
Brownfield License Agreement. The Company is in negotiations to extend the
payment due date.
If the
Company does not adhere to its commitment Solucorp has the right to sub-license
the MBS technology to other entities.
ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
None.
ITEM
9A. CONTROLS AND PROCEDURES
Our Chief
Executive Officer and Principal Financial Officer, after evaluating the
effectiveness of the Company’s “disclosure controls and procedures” (as defined
in the Securities Exchange Act of 1934 (Exchange Act) Rules 13a-15(e) or
15d-15(e)) as of the end of the period covered by this annual report, has
concluded that our disclosure controls and procedures are effective at a
reasonable assurance level based on their evaluation of these controls and
procedures as required by paragraph (b) of Exchange Act Rules 13a-15 or
15d-15.
Management’s
Report on Internal Control Over Financial Reporting
Management
of the Company is responsible for establishing and maintaining adequate internal
control over financial reporting. As defined in Rules 13a-15(f) under the
Securities Exchange Act of 1934, internal control over financial reporting is a
process designed by, or under the supervision of, the Company’s principal
executive, principal accounting and principal financial officers, or
persons performing similar functions, and effected by the Company’s Board of
Directors, management and other personnel, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with accounting
principles generally accepted in the United States of America.
The
Company’s internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records, that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
Company’s assets; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the Company are being made only in accordance with
authorizations of the Company’s management and directors; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company’s assets that could have a
material effect on the financial statements.
Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
The
Company’s management, including the Company’s Chief Executive Officer and
Principal Financial Officer assessed the effectiveness of the Company’s internal
control over financial reporting as of December 31, 2009. In making this
assessment, management used the framework in “Internal Control - Integrated
Framework” promulgated by the Committee of Sponsoring Organizations of the
Treadway Commission, commonly referred to as the “COSO” criteria. Based on the
assessment performed, management believes that as of December 31, 2009, the
Company’s internal control over financial reporting was effective based upon the
COSO criteria. Additionally, based on management’s assessment, the Company
determined that there were no material weaknesses in its internal control over
financial reporting as of December 31, 2009.
This
Annual Report does not include an attestation report of the Company’s
independent registered public accounting firm regarding internal control over
financial reporting. Management’s report was not subject to attestation by the
Company’s registered public accounting firm pursuant to temporary rules of the
SEC that permit the Company to provide only management’s report in this annual
report.
Changes
in Internal Controls
During
the year ended December 31, 2009, there was no change in internal control over
financial reporting that has materially affected, or is reasonably likely to
materially affect our internal control over financial reporting.
ITEM 9B. OTHER
INFORMATION.
None.
PART
III
ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
DIRECTORS
AND EXECUTIVE OFFICERS
The
following table sets forth certain information regarding the members of our
Board of Directors and our executive officers.
Name
|
|
Age
|
|
Positions
and Offices Held
|
Aviram
Malik
|
|
45
|
|
Chief
Executive officer, President and Director
|
Asher
Zwebner
|
|
46
|
|
Chief
Financial/Accounting Officer, Secretary and Director
|
Benny
Karasik
|
|
48
|
|
Treasurer,
Secretary and Director
|
Our
Directors hold office until the next annual meeting of our stockholders or until
their successors are duly elected and qualified. Set forth below is a summary
description of the principal occupation and business experience of each of our
Directors and executive officers for at least the last five years.
Aviram Malik has been our
Chief Executive Officer, President and Director since the Company’s inception on
September 17, 2007. After his service in the Israeli navy as a deep sea diver in
1994, Aviram served as a Branch Manager for a leading pharmaceuticals
corporation in Israel from 1994 to 1997. In 1997, Aviram was appointed European
Sales Manager for Buzz VC, a leading hi-tech video conferencing company. He held
this position for a several years and was later appointed Zone Manager for
Loreal, in France in 2000, where he was responsible for sales and management of
a sales force responsible for the Mediterranean region. From 2002-2003, Aviram
served as a retail manager for one of Israel’s largest companies. As such, he
was responsible for negotiations with suppliers both in Israel and abroad,
overseeing the running of four Duty Free shops in Israel’s air and sea
ports.
Asher Zwebner has been the
Interim Chief Executive Officer of Majic Wheels Corp. since January 2009 and its
Chief Financial Officer since the Company’s inception in March 15, 2007. As of
January 1, 2007, Mr. Zwebner has served as the Chief Financial Officer of
SinoBiomed Inc., and since October 18, 2007, as the Chief Financial Officer of
Suspect Detection Systems, Inc., and its Interim Chief Executive Officer since
February 2008. From November 2004 until October 2006, Mr. Zwebner was also a
Director of SinoBiomed Inc. Since May 2002, he has also served as the Chief
Financial Officer of ForexManage Ltd., a private hi-tech developer of
Internet-based foreign exchange and risk management solutions based in Israel.
From May 2001 until May 2002, Mr. Zwebner served as the Chief Financial Officer
of SMC Ventures.com, a strategic consulting firm specializing in mergers and
acquisitions and in corporate debt and equity financing activities. From January
2000 until May 2001, Mr. Zwebner acted as CFO for Britanica.com, an educational
software company that developed a proprietary e-learning platform technology. .
From March 1995 through December 1999, Mr. Zwebner was a senior manager at the
Israeli accounting office of Kost Forer and Gabbay, a member of Ernst &
Young International. Mr. Zwebner is a CPA in Israel and the United States, and
received a BS Degree in Accounting and Finance from Touro College in 1988.
Benny Karasik, has been an
entrepreneur of start ups and real estate developments as well as an investor in
private equities since 2000. Mr. Karasik was the founder of J&B
Optical USA and was its Chief Executive Officer from 1971 until
2000.
There are
no familial relationships among any of our Directors or officers. None of our
Directors or officers is a Director in any other U.S. reporting companies except
as mentioned above. None of our Directors or officers has been affiliated with
any company that has filed for bankruptcy within the last five years. The
Company is not aware of any proceedings to which any of the Company’s officers
or Directors, or any associate of any such officer or Director, is a party that
are adverse to the Company. We are also not aware of any material interest of
any of our officers or directors that is adverse to our own
interests.
Each
Director of the Company serves for a term of one year or until the successor is
elected at the Company’s annual stockholders’ meeting and is qualified, subject
to removal by the Company’s stockholders. Each officer serves, at the pleasure
of the Board of Directors, for a term of one year and until the successor is
elected at the annual meeting of the Board of Directors and is
qualified.
Audit
Committee and Financial Expert
We do not
have an audit committee or an audit committee financial expert. Our corporate
financial affairs are simple at this stage of development and each financial
transaction can be viewed by any officer or Director at will. We will form an
audit committee if it becomes necessary as a result of growth of the Company or
as mandated by public policy.
Code
of Ethics
We do not
currently have a Code of Ethics applicable to our principal executive, financial
and accounting officers; however, the Company plans to implement such a code in
the second or third quarter of 2010.
Potential
Conflicts of Interest
Since we
do not have an audit or compensation committee comprised of independent
Directors, the functions that would have been performed by such committees are
performed by our Board of Directors. Thus, there is a potential conflict of
interest, in that our Directors who are also our officers have the authority to
determine issues concerning management compensation, and audit issues that may
affect management decisions. We are not aware of any other conflicts of interest
with any of our Directors or officers.
ITEM
11. EXECUTIVE COMPENSATION
Any
compensation received by our officers, directors, and management personnel will
be determined from time to time by our Board of Directors. Our officers,
directors, and management personnel will be reimbursed for any out-of-pocket
expenses incurred on our behalf.
Summary
Compensation
Employment
Contracts. We have no employment agreements with any of our Directors or
executive officers.
Stock
Options/SAR Grants. On July 22, 2009,
the Company adopted the Stock Incentive Plan, pursuant which the Company is
authorized to grant equity-based awards in the form of stock options, restricted
common stock, restricted stock units, stock appreciation rights, and other stock
based awards to employees (including executive officers), directors, consultants
and service provider of the Company and its subsidiaries. The maximum
number of shares available for grant under the plan is 25,000,000 shares of
common stock. The number of shares available for award under the plan
is subject to adjustment for certain corporate changes and based on the types of
awards provided, all in accordance with the provisions of the plan. The plan may
be administered by the Board.
Pursuant
to the Termination Agreement, the Company issued 7,000,000 shares of its common
stock, which were divided equally between the Mr. Boaz Benrush and Mr. Oren
Bar-nir Gayer, in consideration for the aggregate purchase price of US$7,000 or
$0.001 per share. The purchase price was deducted from the amount to be
reimbursed to the Mr. Boaz Benrush and Mr. Oren Bar-nir Gayer for fees incurred
in performing their duties as directors of the Company. The issuances of the
7,000,000 shares were made pursuant to the Stock Incentive Plan. In accordance
with the Termination Agreement, such shares were issued to the Trustee on behalf
of Mr. Benrush and Mr. Bar-nir Gayer and are being held by the Trustee for the
appropriate holding period required by Section 102(b)(2) of the Israeli Income
Tax Ordinance (Capital Gain Option Through a Trustee) and subject to
requirements of Rule 144 of the Securities Act of 1933, as amended.
SUMMARY
COMPENSATION TABLE
Name
and
principal
position
|
Year
|
|
Salary
|
|
Bonus
|
|
|
Stock
Awards
|
|
Option
Awards
|
|
Non-Equity
Incentive
Plan
Compensation
|
|
Nonqualified
Deferred
Compensation
Earnings
|
|
All
Other
Compensation
|
|
|
Total
|
|
Aviriam
Malik, CEO
|
2007
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2008
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2009
|
|
$ |
66,567 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
66,567 |
|
Asher
Zwebner,
CFO
|
2007
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2008
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2009
|
|
$ |
24,000 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
24,000 |
|
Gal
Ilivitski
|
2007
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2008
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2009
|
|
$ |
16,667 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
16,667 |
|
*Boaz
Benrush
|
2007
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2008
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2009
|
|
$ |
0 |
|
0 |
|
$
|
147,000 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
147,000 |
|
*Oren
Bar-nir Gayer
|
2007
|
|
|
|
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2008
|
|
$ |
0 |
|
0 |
|
|
0 |
|
|
0 |
|
0 |
|
0 |
|
|
0 |
|
|
$ |
0 |
|
2009
|
|
$ |
0 |
|
0 |
|
$
|
147,000 |
|
|
0 |
|
0 |
|
0 |
|
$ |
0 |
|
|
$ |
147,000 |
|
*Issued pursuant to the
termination agreement
Long-Term
Incentive Plans. As of December 31, 2009, we had no group life, health,
hospitalization, or medical reimbursement or relocation plans in effect.
Further, we had no pension plans or plans or agreements which provide
compensation on the event of termination of employment or corporate change in
control.
Outstanding
Equity Awards. As of December 31, 2009, none of our Directors or
executive officers holds unexercised options, stock that has not vested, or
equity incentive plan awards.
Compensation
of Directors
During
the year 2009 no compensation has been paid to any of our Directors in
consideration for their services rendered in their capacity as directors, except
for an aggregate of $107,234 paid in consulting fees and $147,000 paid to two
directors pursuant to a termination agreement, as in the summary compensation
table.
ITEM 12. SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS.
The
following table lists the number of shares of common stock of our Company that
are beneficially owned by (i) each person or entity known to our Company to be
the beneficial owner of more than 5% of the outstanding common stock; (ii) each
officer and director of our Company; and (iii) all officers and directors as a
group. Information relating to beneficial ownership of common stock by our
principal shareholders and management is based upon information furnished by
each person using “beneficial ownership” concepts under the rules of the
Securities and Exchange Commission. Under these rules, a person is deemed to be
a beneficial owner of a security if that person has or shares voting power,
which includes the power to vote or direct the voting of the security, or
investment power, which includes the power to vote or direct the voting of the
security. The person is also deemed to be a beneficial owner of any security of
which that person has a right to acquire beneficial ownership within 60 days.
Under the Securities and Exchange Commission rules, more than one person may be
deemed to be a beneficial owner of the same securities, and a person may be
deemed to be a beneficial owner of securities as to which he or she may not have
any pecuniary beneficial interest. Except as noted below, each person has sole
voting and investment power.
The
percentages below are calculated based on 124,745,000 shares of our
common stock issued and outstanding as of April 13, 2010. We do not have any
outstanding options, warrants or other securities exercisable for or convertible
into shares of our common stock. The address of each person listed is c/o Aviram
Malik, 76/7 Zalman Shazar Street, Hod Hasharon, Israel 45350.
Officers,
Directors and 5% Stockholders
|
|
No.
of
Shares
|
|
Percentage
Ownership
|
|
|
|
|
|
Aviram
Malik
|
|
|
10,000,000 |
|
8%
|
|
|
|
|
|
|
Benjamin
Karasik
|
|
5,050,000
|
|
4%
|
|
|
|
|
|
|
Solucorp
Industries Ltd.
|
|
|
8,890,000 |
|
7%
|
|
|
|
|
|
|
Shlomoh
Letzeyr |
|
|
10,000,000 |
|
8%
|
|
|
|
|
|
|
Zvi
Benjamin |
|
|
10,000,000 |
|
8%
|
|
|
|
|
|
|
All
directors and executive officers as a group (2 persons) |
|
|
15,050,000 |
|
12%
|
Item
13. Certain Relationships and Related Transactions, and Director
Independence.
Other
than the transactions discussed below, we have not entered into any transaction
nor are there any proposed transactions in which our Director, executive
officer, stockholders or any member of the immediate family of the foregoing had
or is to have a direct or indirect material interest.
On
November 20, 2007, the Company subscribed 7,525,000 shares (post forward stock
split) of common stock to Mr. Aviram Malik, President and Director, for a cash
payment of $150.
On
November 20, 2007, the Company subscribed 2,500,000 shares (post forward stock
split) of common stock to Mr. Gal Ilivitzki, Secretary and Director, for a cash
payment of $50.
For the
year ending December 31, 2009, the Company paid consulting fees in the amount of
$107,234 to Directors and officers of the Company.
Director
Independence
We are
not subject to listing requirements of any national securities exchange or
national securities association and, as a result, we are not at this time
required to have a majority of “independent directors” on our board of
directors. We do not believe that any of our current directors are
independent.
Item
14. Principal Accountant Fees and Services.
Fees
Paid to Principal Accountant
Weinberg &
Bear LLC has served as the Company’s independent auditor since
inception. During our 2009 and 2008 fiscal years, the aggregate fees which were
billed to us by our independent auditor for professional services were as
follows:
|
|
Fiscal
Year Ended
|
|
|
|
December 31, 2009
|
|
|
December 31, 2008
|
|
Audit
Fees
|
|
$
|
14,000
|
|
|
$
|
14,000
|
|
Audit-Related
Fees
|
|
|
|
|
|
|
|
|
Tax
Fees
|
|
$
|
500
|
|
|
$
|
500
|
|
All
Other Fees
|
|
|
|
|
|
|
|
|
Audit
Committee Pre-Approval of Audit and Permissible Non-Audit Services of
Independent Registered Public Accounting Firm.
As of
December 31, 2009, the Board has not established a formal documented
pre-approval policy for the fees of our principal accountant.
The
percentage of hours expended on the principal accountant’s engagement to audit
our financial statements for the most recent fiscal year that were attributed to
work performed by persons other than the principal accountant’s full-time,
permanent employees was 0%.
Part
IV
Item
15. Exhibits, Financial Statement Schedules.
Exhibit
No.
|
|
Description
|
3.1
|
|
Certificate
of Incorporation (incorporated by reference to the Company’s Registration
Statement on Form SB-2, as filed with the Securities and Exchange
Commission on January 29, 2008).
|
|
|
|
3.2
|
|
By-Laws
(incorporated by reference to the Company’s Registration Statement on Form
SB-2, as filed with the Securities and Exchange Commission on January 29,
2008).
|
|
|
|
10.1
|
|
Exclusive
Worldwide Patent-Pending Sale Agreement between 1 Lane Technologies Corp.
and Eliezer Sheffer (incorporated by reference to the Company’s
Registration Statement on Form SB- 2, as filed with the Securities and
Exchange Commission on January 29, 2008).
|
|
|
|
10.2
|
|
Purchase
and Sale Agreement dated July 1, 2008, between Lavi Krasney and A.
Malik (incorporated by reference to the Company’s Registration
Statement on Form SB-2, as filed with the Securities and Exchange
Commission on January 29, 2008).
|
|
|
|
10.3
|
|
Purchase
and Sale Agreement dated July 1, 2008, between Asher Zwebner and Luscare
Holdings Corp. (incorporated by reference to the Company’s
Current Report on Form 8-K, as filed with
the Securities and Exchange Commission on July 15,
2008)
|
|
|
|
10.4
|
|
Purchase
and Sale Agreement dated July 1, 2008, between Asher Zwebner and Amnon
Dardick (incorporated by reference to the Company’s Current Report on
Form 8-K, as filed with the Securities and Exchange Commission on
July 15, 2008).
|
|
|
|
10.5
|
|
Purchase
and Sale Agreement dated July 1, 2008, between Asher Zwebner and Shmuel
Maayan (incorporated by reference to the Company’s Current
Report on Form 8-K, as filed with the Securities and Exchange
Commission on July 15, 2008)
|
|
|
|
10.6
|
|
Exclusive
Brownfield License Agreement, dated October 27, 2008 by and between 1
Lane Technologies Corp and Solucorp Industries, Ltd.
(incorporated by reference to the Company’s Current Report on
Form 8-K, as filed with the Securities and Exchange Commission on
October 28, 2008)
|
|
|
|
10.7
|
|
Agreement
dated July 22, 2009 by and between Adama Technologies Corp and each of
Boaz Benrush and Oren Bar-nir Gayer (incorporated by reference to the
Company’s Current Report on Form 8-K, as filed with the
Securities and Exchange Commission on July 28, 2009).
|
|
|
|
10.8
|
|
2009
Employee Stock Incentive Plan (incorporated by reference to the
Company’s Current Report on Form 8-K, as filed with the Securities
and Exchange Commission on July 28, 2009).
|
|
|
|
10.9
|
|
Service
Agreement dated July 22, 2009, by and between Adama Technologies Corp. and
Adama Technologies (Israel) Ltd. (incorporated by reference to the
Company’s Current Report on Form 8-K, as filed with the
Securities and Exchange Commission on July 28, 2009).
|
|
|
|
10.9
|
|
Agreement
dated September 30, 2009 by and between Adama Technologies Corporation and
each of Boaz Benrush and Oren Bar-nir Gayer (incorporated by reference to
the Company’s Current Report on Form 8-K, as filed with the
Securities and Exchange Commission on October 6, 2009).
|
|
|
|
31.1
|
|
Certification
of Chief Executive Officer required by Rule 13a-14(a) under the Exchange
Act (filed herewith).
|
|
|
|
31.2
|
|
Certification
of Chief Financial Officer required by Rule 13a-14(a) under the Exchange
Act (filed herewith).
|
|
|
|
32
|
|
Certification
of Principal Executive, Financial and Accounting Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of
Sarbanes-Oxley Act of 2002 (filed
herewith).
|
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934 ADAMA TECHNOLOGIES
CORPORATION has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
|
ADAMA
TECHNOLOGIES CORPORATION
|
|
|
|
|
|
|
By:
|
/s/ Aviram
Malik
|
|
|
|
Aviram
Malik, Chief Executive Officer,
|
|
|
|
President
and Director (Principal Executive Officer) |
|
|
|
|
|
|
|
|
|
|
|
/s/ Asher Zwebner
|
|
|
|
Asher
Zwebner
|
|
|
|
Chief
Financial Officer, Secretary and Director |
|
|
|
(Principal
Financial and Accounting Officer)
|
|
|
|
|
|