Edgar Filing: Adama Technologies Corp

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2012

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________ to __________________________.

Commission File Number: 333-148910

ADAMA TECHNOLOGIES CORP.

(Exact name of registrant as specified in its charter)

Delaware		98-0552470
(State or other jurisdiction of incorporation)		(IRS Employer Identification No.)

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 ¨ No S

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 £ No S

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 S No £

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 ¨	Accelerated filer ¨

Non-accelerated filer ¨	Smaller reporting company S
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

Yes S No £

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 fiscal quarter. Approx $2,195,000 based upon $.005 per share which was the last price at which the common equity purchased by non-affiliates was last sold.

The number of shares of the issuer’s common stock issued and outstanding as of December 31, 2012 was 439,851,197 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

		Page
PART I
Item 1	Business	3
Item 1A	Risk Factors	5
Item 1B	Unresolved Staff Comments	5
Item 2	Properties	5
Item 3	Legal Proceedings	5
Item 4	Removed and Reserved	5

PART II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	5
Item 6	Selected Financial Data	8
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operation	8
Item 7A	Quantitative and Qualitative Disclosures About Market Risk	11
Item 8	Financial Statements.	11
Item 9	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	11
Item 9A	Controls and Procedures	12
Item 9B	Other Information	12

PART III
Item 10	Directors, Executive Officers and Corporate Governance	12
Item 11	Executive Compensation	13
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	14
Item 13	Certain Relationships and Related Transactions, and Director Independence	15
Item 14	Principal Accountant Fees and Services	16

PART IV
Item 15	Exhibits, Financial Statement Schedules	17

SIGNATURES		18

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 October 28, 2011, the Company initiated a reverse stock split on its common stock of 300-1 which became effective on October 28, 2011. The authorized shares of the Company did not change .

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 paid 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.

The Company is not continuing its original business plan of the development of the Patent acquired from Mr Eliezer Sheffer.

On October 28, 2011, the Company initiated a reverse stock split on its common stock of 300-1 which became effective on October 28, 2011. The authorized shares of the Company did not change .

On November 18, 2011, Adama Technologies Corporation (the “Registrant”) entered a Stock Purchase Agreement with ANOE SA, organized under the laws of St. Vincent and the Grenadines (“ANOE”), to acquire 477 shares, representing approximately 19.5% of the outstanding shares of YGE Mining PLC, organized under the laws of the Federal Democratic Republic of Ethiopia (“YGE”). YGE is the owner of an exclusive license to conduct exploration for gold and tantalum in an area of 40 kilometers in Ethiopia. Tantalum is used in the manufacture tantalum capacitors that are widely used in circuit designs because of their volumetric efficiency, basic reliability and process compatibility for electronic equipment such as mobile phones, DVD players, video game systems and computers. The Stock Purchase Agreement between the Registrant and ANOE, which provides for the issuance of 20,000,000 restricted shares of the Registrant’s common stock in consideration for the acquisition of the YGE Shares, is attached as Exhibit 99.1 hereto.

On December 15, 2011, Adama Technologies Corporation (the “Registrant”) entered an agreement with Ansalt Multicommertz, a limited liability company organized under the laws of Liechtenstein (the “Assignor”), pursuant to which the Assignor assigned to the Registrant its 90% interest in the Harrison Lake (Talc) Creek Magnesium property in exchange of the issuance of 25,000,000 restricted common stock of the Registrent to the Assignor.

Effective July 9, 2012, the Company entered into a Mineral Property Acquisition Agreement with MineSadco S.A., an Ecuadorian company. MineSadco is the owner of an undivided, 100% interest in a certain mineral property located in Canton Portovelo, El Oro Province, in the South of Ecuador. Pursuant to the terms of the agreement, the Company acquired the rights to commercially exploit 100% of the mineral rights to the Property for a period of twenty years. In consideration, the Company issued 120,000,000 restricted shares of its common stock to MineSadco. In addition, if within eighteen months from the closing date certain production millstones will be completed, MineSadco will be entitled to additional shares representing up to 55% of the Companies diluted capital at the closing date.

Employees

Other than our current directors and officers, we have no other full time or part-time employees however the Company has various consultants.. 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.

Holders

As of December 31, 2012, there were 439,851,197 shares of our common stock issued and outstanding, which were held by 368 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 January 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 33,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $110,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On January 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 8,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $27,500. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On January 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 13,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $44,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On January 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 3,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $11,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On April 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 60,000 (post reverse stock split) shares of its unregistered common stock on said date valued at $50,400. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On April 5, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 150,000 (post reverse stock split) shares of its unregistered common stock on said date valued at $157,500. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On April 13, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 30,000 (post reverse stock split) shares of its unregistered common stock on said date valued at $25,200. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On October 28, 2011, the Company implemented a 1 for 300 reverse stock split on its issued and outstanding shares of common stock to the holders of record as of October 28, 2011. After the reverse split, the number of shares of common stock issued and outstanding were 1,149,341 shares. The accompanying financial statements and related notes thereto have been adjusted accordingly to reflect this reverse stock split.

On November 21, 2011, the Company entered into an agreement with a director. As payment for services, the Company issued 5,000,000 shares of its unregistered common stock on said date valued at $850,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 15% discount for restricted trading.

On November 21, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 2,000,000 shares of its unregistered common stock on said date valued at $340,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 15% discount for restricted trading.

On November 21, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 1,000,000 shares of its unregistered common stock on said date valued at $170,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 15% discount for restricted trading.

On November 21, 2011, 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 $85,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount for restricted trading.

On November 21, 2011, the Company entered into an agreement with an unrelated third-party to purchase 477 shares of YGE Mining PLC. As payment for the 477 shares of YGE Mining PLC, the Company issued 20,000,000 shares of its unregistered common stock on said date valued at $3,400,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 15% discount for restricted trading.

On December 1, 2011, the Company entered into an agreement with a director. As payment for services, the Company issued 2,000,000 shares of its common stock on said date valued at $420,000. The fair value of the shares was determined based on the recent closing price of the Company’s stock on the date of grant.

On December 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 1,000,000 shares of its common stock on said date valued at $209,900. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant.

On December 8, 2011, the Company entered into an agreement with an unrelated third-party to purchase a magnesium property. As payment for the property, the Company issued 25,000,000 shares of its unregistered common stock on said date valued at $4,250,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 15% discount for restricted trading.

On January 4, 2012, the Company raised $8,500 and issued 8,500,000 shares of its common stock, with a purchase price $0.001 per share, to investors. As of December 31, 2012 the investment was receivable.

On January 13, 2012, the Company raised $16,760 and issued 16,760,000 shares of its common stock, with a purchase price $0.001 per share, to investors. As of December 31, 2012 the investment was receivable.

On February 21, 2012, the Company raised $19,730 and issued 19,730,000 shares of its common stock, with a purchase price $0.001 per share, to investors. As of December 31, 2012 the investment was receivable.

On May 22, 2012, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 10,000,000 shares of its common stock on said date valued at $10,000. The fair value of the unregistered shares was determined based on trading restrictions on the date of grant.

On May 31, 2012, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 1,500,000 shares of its common stock on said date valued at $1,500. The fair value of the unregistered shares was determined based on trading restrictions on the date of grant.

On July 15, 2012, the Company entered into an agreement with unrelated third-party consultants. As payment for the consultant’s services, the Company issued 30,000,000 shares of its common stock on said date valued at $30,000. The fair value of the unregistered shares was determined based on trading restrictions on the date of grant.

On July 15, 2012, the Company issued 120,000,000 shares of its unregistered common stock valued at $120,000 to MineSadco S.A., an Ecuadorian company, to purchase a 100% interest to exploit and commercialize a mining property located in Ecuador for 20 years.

On July 18, 2012, August 8, 2012, September 28, 2012 and December 6, 2012, the Company issued a total of 170,890,600 shares of common stock pursuant to agreements with unrelated third-parties for consulting services. The shares of common stock were valued at $170,891. The fair value of the unregistered shares was determined based on trading restrictions on the date of grant.

From January 1, 2012 to December 31, 2012, the Company issued 2,713,355 shares of its common stock upon conversion of convertible debt of $63,000 and $2,700 of interest.

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.

The Company has discontinued to pursue the business plan relating to this technology .

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 have not generated any revenues to date. Our expenses in the year ended December 31, 2012 amounted to $2,509,483, as compared to $8,986,923 for the year ended December 31, 2011. Expenses in 2012 was primarily comprised of third party consulting expenses..

Our net loss in the year ended December 31, 2012, amounted to $2,613,018 as compared to the net loss of $8,260,365 during the year ended December 31, 2011 The large loss in 2011 is primarily responsible for the recording of the impairment loss of $8,050,000.

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 $601 in cash at December 31, 2012, as compared to cash in the amount of $624 on December 31, 2011.

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 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.

On October 15, 2010 the Company signed a $50,000 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on July 27, 2011. The note has conversion rights that allow the holder of the note at any time to convert all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On December 13, 2010 the Company signed a $25,000 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on September 15, 2011. The note has conversion rights that allow the holder of the note at any time to convert all or any part of the remaining principal balance into the Company’s common stock at a price equal to 55% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On April 4, 2011, the Company signed a $25,000 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on January 6, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On May 12, 2011, the Company signed a $30,000 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on February 12, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. As of December 31, 2011 a payment of $10,000 was paid on this note by conversion to shares.

On June 7, 2011, the Company signed a $32,500 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on March 7, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On September 8, 2011, the Company signed a $32,500 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on June 8, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On November 18, 2011, the Company signed a $30,000 convertible promissory note with a third party. The note bears interest at 8% per annum and is due on August 18, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 55% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period.

On April 27, 2012, the Company signed a $32,500 convertible promissory note with a third party. The note bears interest at 8% per annum and was due on January 27, 2013. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. As of January 28, 2013 this note was in default. According to the terms of the note upon default the balance due is 150% of the unpaid principal balance. In addition, from the date of default the notes bear interest at 22% per annum. The investor may in its sole discretion convert the default amount into equity. As of December 31, 2012, the note balance was retroactively adjusted to 150% for the default which occurred subsequent to December 31, 2012.

In accordance with ASC 470, the Company has analyzed the beneficial nature of the conversion terms and determined that a beneficial conversion feature (BCF) exists. The Company calculated the value of the BCF using the intrinsic method as stipulated in ASC 470. The BCF has been recorded as a discount to the notes payable and to Additional Paid-in Capital.

As of December 31, 2012 and 2011, the balance of convertible notes payable was $113,191 and $77,355 net of unamortized discounts of $2,309 and $30,145, respectively.

For the year ended December 31, 2012 and 2011 the Company has recognized $13,665 and $8,045 in interest expense related to the notes and has amortized $51,370 and $104,608 of the beneficial conversion features which has been recorded as interest expense, respectively.

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, 2012, 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.

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, 2012. 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, 2011, 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, 2011.

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, 2012, 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

Asher Zwebner	48	Chief Executive Officer , Chief Financial/Accounting Officer, 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.

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.

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 quarter of 2012.

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. No options have been issued to date under the plan .

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	2012	$		0	$	728,572		0		0		0		0	$	728,572

Asher Zwebner, CFO	2012	$		0	$	360,000		0		0		0		0	$	360,000

Benny Karasik	2012	$		0	$			0		0		0		0	$

Long-Term Incentive Plans. As of December 31, 2012, 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, 2012, 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 2012 no compensation has been paid to any of our Directors in consideration for their services rendered in their capacity as directors

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 59,757,074 shares of our common stock issued and outstanding as of December 31 2011. 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



Ascher Zwebner	2,000,000		%

ANOE SA		20,000,000	5%
		25,000,000
Ansalt Multicommertz, MineSadco S.A		120,000,000	26%

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.

As of December 31, 2012 and 2011 the Company owed $92,194 and $53,945, respectively, to Directors, officers, and principal stockholders of the Company for working capital loans. The loans are unsecured, non-interest bearing, and have no terms for repayment.

For the year ended December 31, 2012, the Company expensed share based consulting fees of $1,088,572 and $190,429, respectively, 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 & Baer LLC has served as the Company’s independent auditor since inception. During our 2012 and 2011 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, 2012		December 31, 2011
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, 2012, 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

Date April 30, 2013	By:



		/s/ Asher Zwebner
		Asher Zwebner
		Chief Executive Officer , Chief Financial Officer, Secretary and Director
		(Principal Financial and Accounting Officer)

ADAMA TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

INDEX TO FINANCIAL STATEMENTS

DECEMBER 31, 2012

Report of Registered Independent Auditor	F-2

Financial Statements-

Balance Sheets as of December 31, 2012 and December 31, 2011	F-3

Statements of Operations for the Years Ended
December 31, 2012 and 2011and Cumulative from Inception	F-4

Statement of Changes in Stockholders’ Equity (Deficit) for the Period from Inception
Through December 31, 2012	F-5

Statements of Cash Flows for Years Ended December 31, 2012 and 2011
and Cumulative from Inception	F-6

Notes to Financial Statements	F-7

F-1

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, 2012 and 2011, and the related statements of operations, stockholders’ equity (deficit), and cash flows for years ended December 31, 2012 and 2011, and from inception (September 17, 2007) through December 31, 2012. 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, 2012 and 2011, and the results of its operations and its cash flows for the years ended December 31, 2012 and 2011, and from inception (September 17, 2007) through December 31, 2012, 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, 2012, 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,

Weinberg & Baer LLC

Baltimore, Maryland

April 11, 2013

F-2

ADAMA TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS

AS OF DECEMBER 31, 2012 AND 2011


	As of			As of
	December 31,			December 31,
	2012			2011
ASSETS
Current Assets:
Cash in bank	$	601		$	624
Prepaid expenses		—			2,115,938

Total current assets		601			2,116,562

Other Assets:
Investments		8,170,000			8,050,000
Allowance for impairment loss		(8,170,000	)		(8,050,000	)

Total Assets		601			2,116,562

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
Accounts payable and accrued liabilities	$	45,769		$	44,420
Loans from related parties - Directors and stockholders		92,194			53,945
Convertible notes payable, net of discount		113,191			77,355
Current maturities of long-term debt		250,000			150,000

Total current liabilities		501,154			325,720

Long-term debt		100,000			200,000

Total liabilities		601,154			525,720

Commitments and Contingencies

Stockholders' Equity
Common stock, par value $.0001 per share, 500,000,000 shares authorized; 439,851,197 and 59,757,242 shares issued and outstanding, respectively		43,982			5,976
Additional paid-in capital		17,086,952			16,658,344
Stock subscriptions receivable		(44,990	)		—
(Deficit) accumulated during the development stage		(17,686,497	)		(15,073,478	)

Total stockholders' equity (deficit)		(600,553	)		1,590,842

Total Liabilities and Stockholders' Equity	$	601		$	2,116,562

The accompanying notes to financial statements are

an integral part of these financial statements.

F-3

ADAMA TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2012

AND 2011 AND CUMULATIVE FROM INCEPTION (SEPTEMBER 17, 2007)

THROUGH DECEMBER 31, 2012


	Years Ended						Cumulative
	December 31,						From
	2012			2011			Inception

Revenues	$	—		$	—		$	—

Expenses:
General and administrative-
Professional fees		56,020			81,571			261,469
Legal - incorporation		—			—			2,200
Consulting		2,328,328			852,554			4,744,092
Travel		5,000			—			22,890
Amortization		—			—			305,555
Rent		—			—			4,520
Impairment loss		120,000			8,050,000			12,924,445
Franchise tax		—			—			3,500
Other		136			2,798			29,272

Total general and administrative expenses		2,509,484			8,986,923			18,297,943

(Loss) from Operations		(2,509,484	)		(8,986,923	)		(18,297,943	)

Other Income (Expense)
Foreign currency transaction gains		—			—			2,769
Forgiveness of debt		—			840,000			840,000
Foreign currency transaction losses		—			(789	)		(4,520	)
Interest expense		(103,535	)		(112,653	)		(226,803	)

Provision for income taxes		—			—			—

Net Income (Loss)	$	(2,613,019	)	$	(8,260,365	)	$	(17,686,497	)

Earnings (Loss) Per Common Share:
Earnings (Loss) per common share - Basic	$	(0.01	)	$	(1.29	)

Weighted Average Number of Common Shares
Outstanding - Basic		246,420,975			6,420,733

The accompanying notes to financial statements are

an integral part of these financial statements.

F-4

ADAMA TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF STOCKHOLDERS' EQUITY

FOR THE PERIOD FROM INCEPTION (SEPTEMBER 17, 2007)

THROUGH DECEMBER 31, 2012


										(Deficit)
										Accumulated
					Additional		Stock			During the
	Common stock*				Paid-in		Subscriptions			Development
	Shares		Amount		Capital		Receivable			Stage			Totals

Balance - September 17, 2007		—	$	—	$	—	$	—		$	—		$	—
Common stock issued for cash		116,667		12		688		—			—			700
Net (loss) for the period		—		—		—		—			(5,118	)		(5,118	)
Balance - December 31, 2007		116,667		12		688		—			(5,118	)		(4,418	)
Common stock issued for cash		50,000		5		66,195		—			—			66,200
Common stock issued for cash		50,000		5		88,795		—			—			88,800
Common stock issued for acquired technology		29,633		3		3,999,997		—			—			4,000,000
Net (loss) for the year		—		—		—		—			(160,515	)		(160,515	)
Balance - December 31, 2008		246,300		25		4,155,675		—			(165,633	)		3,990,067
Common stock issued for cash		10,417		1		203,785		—			—			203,786
Common stock issued as compensation		417		—		22,001		—			—			22,001
Common stock issued for cash		5,000		1		119,999		—			—			120,000
Common stock issued as compensation		4,017		—		84,350		—			—			84,350
Common stock issued for cash		2,500		—		35,000		—			—			35,000
Common stock issued as compensation		4,167		—		58,750		—			—			58,750
Common stock issued as compensation		11,667		1		146,999		—			—			147,000
Common stock issued as compensation		11,667		1		146,999		—			—			147,000
Common stock issued as compensation		1,667		—		7,000		—			—			7,000
Net (loss) for the year		—		—		—		—			(5,780,153	)		(5,780,153	)
Balance - December 31, 2009		297,817		29		4,980,558		—			(5,945,786	)		(965,199	)
Common stock issued as compensation		13,333		1		27,999		—			—			28,000
Common stock issued as compensation		13,333		1		27,999		—			—			28,000
Common stock issued as compensation		13,333		1		27,999		—			—			28,000
Common stock issued as compensation		33,333		3		69,997		—			—			70,000
Common stock issued as compensation		11,333		1		23,799		—			—			23,800
Common stock issued as compensation		33,333		3		69,997		—			—			70,000
Common stock issued for cash		26,667		3		12,997		—			—			13,000
Common stock issued as compensation		23,333		2		62,998		—			—			63,000
Common stock issued as compensation		10,833		1		13,974		—			—			13,975
Common stock issued for cash		27,167		3		34,997		(28,000	)		—			7,000
Common stock issued as compensation		8,333		1		22,499		—			—			22,500
Common stock issued as compensation		37,000		4		110,996		—			—			111,000
Common stock issued as compensation		16,667		2		49,998		—			—			50,000
Common stock issued for cash		33,333		3		9,997		—			—			10,000
Payment of stock subscription receivable		—		—		—		9,000			—			9,000
Common stock issued as compensation		16,667		2		24,498		—			—			24,500
Common stock issued as compensation		49,833		5		209,295		—			—			209,300
Discount of convertible note		—		—		36,207		—			—			36,207
Common stock issued as compensation		23,701		2		49,418		—			—			49,420
Discount of convertible note		—		—		20,454		—			—			20,454
Net (loss) for the year		—		—		—		—			(867,327	)		(867,327	)
Balance - December 31, 2010		689,351		67		5,886,676		(19,000	)		(6,813,113	)		(945,370	)
Common stock issued as compensation		33,333		3		109,997		—			—			110,000
Common stock issued as compensation		8,333		1		27,499		—			—			27,500
Common stock issued as compensation		13,333		1		43,999		—			—			44,000
Common stock issued as compensation		3,333		—		11,000		—			—			11,000
Common stock issued as compensation		33,333		3		109,997		—			—			110,000
Stock subscriptions payments received		—		—		—		19,000			—			19,000
Common stock issued as compensation		60,000		6		50,394		—			—			50,400
Common stock issued as compensation		150,000		15		157,485		—			—			157,500
Common stock issued as compensation		30,000		3		25,197		—			—			25,200
Discount of convertible note		—		—		63,361		—			—			63,361
Common stock issued upon conversion of debt		128,491		13		79,058		—			—			79,071
Discount of convertible note		—		—		24,545		—			—			24,545
Common stock issued as compensation		5,000,000		500		849,500		—			—			850,000
Common stock issued as compensation		2,000,000		200		339,800		—			—			340,000
Common stock issued as compensation		2,000,000		200		339,800		—			—			340,000
Common stock issued as compensation		1,000,000		100		169,900		—			—			170,000
Common stock issued as compensation		500,000		50		84,950		—			—			85,000
Common stock issued as compensation		2,000,000		200		419,800		—			—			420,000
Common stock issued as compensation		1,000,000		100		209,900		—			—			210,000
Conversion of convertible note payable		107,733		11		9,989		—			—			10,000
Common stock issued to purchase asset		25,000,000		2,500		4,247,500		—			—			4,250,000
Common stock issued to purchase asset		20,000,000		2,000		3,398,000		—			—			3,400,000
Net loss for the year		—		—		—		—			(8,260,365	)		(8,260,365	)
Balance - December 31, 2011		59,757,242		5,973		16,658,347		—			(15,073,478	)		1,590,842
Common stock issued for cash		8,500,000		850		7,650		(8,500	)		—			—
Common stock issued for cash		16,760,000		1,676		15,084		(16,760	)		—			—
Conversion of convertible note payable		407,692		41		26,459		—			—			26,500
Common stock issued for cash		19,730,000		1,973		17,757		(19,730	)		—			—
Conversion of convertible note payable		913,793		91		21,109		—			—			21,200
Conversion of convertible note payable		529,801		53		7,947		—			—			8,000
Discount of convertible note		—		—		23,533		—			—			23,533
Common stock issued as compensation		10,000,000		1,000		9,000		—			—			10,000
Common stock issued as compensation		1,500,000		150		1,350		—			—			1,500
Conversion of convertible note payable		862,069		86		9,914		—			—			10,000
Common stock issued as compensation		30,000,000		3,000		27,000								30,000
Common stock issued to purchase asset		120,000,000		12,000		108,000								120,000
Common stock issued as compensation		170,890,600		17,089		153,802								170,891
Net loss for the year		—		—		—		—			(2,613,019	)		(2,613,019	)
Balance - December 31, 2012		439,851,197	$	43,982	$	17,086,952	$	(44,990	)	$	(17,686,497	)	$	(600,553	)

*Restated to reflect reverse stock split

The accompanying notes to financial statements are

an integral part of these financial statements.

F-5

ADAMA TECHNOLOGIES CORP.

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2012 AND 2011,

AND CUMULATIVE FROM INCEPTION (SEPTEMBER 17, 2007)

THROUGH DECEMBER 31, 2012

	Years Ended						Cumulative
	December 31,						From
	2012			2011			Inception

Operating Activities:
Net Income (loss)	$	(2,613,019	)	$	(8,260,365	)	$	(17,686,497	)
Adjustments to reconcile net (loss) to net cash
(used in) operating activities:					—
Common stock issued as compensation and interest		215,091			2,954,671			4,427,358
Amortization of beneficial conversion feature		51,370			104,608			165,793
Impairment loss		120,000			8,050,000			12,924,445
Amortization		—			—			305,555
Forgiveness of debt		—			(840,000	)		(840,000	)
Changes in net assets and liabilities-
Prepaid expenses		2,115,938			(2,115,939	)		—
Accounts payable and accrued liabilites		39,849			13,206			84,268

Net Cash Used in Operating Activities		(70,771	)		(93,819	)		(619,078	)

Investing Activities:
Acquisition and costs of intangible assets		—			(400,000	)		(610,000	)

Net Cash Used in Investing Activities		—			(400,000	)		(610,000	)

Financing Activities:
Deferred offering costs		—			—			(25,000	)
Proceeds from issuance of common stock		—			19,000			597,486
Proceeds from convertible note payable		32,500			117,500			225,000
Proceeds from debt		—			350,000			350,000
Payment of debt		—			(10,000	)		(10,000	)
Proceeds from stockholder loans		58,248			127,639			752,188
Payment of stockholder loans		(20,000	)		(111,617	)		(659,995	)

Net Cash Provided by Financing Activities		70,748			492,522			1,229,679

Net (Decrease) Increase in Cash		(23	)		(1,297	)		601

Cash - Beginning of Period		624			1,921			—

Cash - End of Period	$	601		$	624		$	601

Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for:
Interest	$	—		$	—		$	—
Income taxes	$	—		$	—		$	—

Supplemental schedule of noncash investing and financing activities:
Issuance of common stock for acquired technology	$	—		$	—		$	4,000,000
Obligation payable for acquired technology	$	—		$	—		$	850,000
Stock issued to settle convertible debts	$	63,000		$	85,000		$	148,000
Issuance of common stock for investments	$	120,000		$	7,650,000		$	7,770,000

The accompanying notes to financial statements are

an integral part of these financial statements.

F-6

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 accompanying financial statements of Adama Technologies were prepared from the accounts of the Company under the accrual basis of accounting.

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.

Earnings per Common Share

Basic earnings per share is computed by dividing the net income attributable to the common stockholders by the weighted average number of shares of common stock outstanding during the period. Fully diluted earnings per share is computed similar to basic earnings 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. Common stock equivalents were not included in the computation of diluted earnings per share in the statement of operations due to the fact that the Company reported a net loss and to do so would be anti-dilutive for the periods presented.

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.

F-7

Fair Value of Financial Instruments

Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 820 “Fair Value Measurements and Disclosures” (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) a reporting entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:

Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

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, 2012 and 2011, the carrying value of accounts payable and loans that are required to be measured at fair value, 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.

F-8

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, liabilities and expenses. Actual results could differ from those estimates made by management.

Recent Accounting Pronouncements

We do not expect that any recently issued accounting pronouncements will have a material effect on our financial statements.

(2) Development Stage Activities and Going Concern

The Company is currently in the development stage, and has limited operations.

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, 2012, the cash resources of the Company were insufficient to meet its current business plan. 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. During the ended December 31, 2009, the Company recorded an impairment loss for the full value of the patent.

(4) Investments

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.

During the year ended December 31, 2009, the Company recorded an impairment loss for the full value of the acquired technology.

F-9

In consideration for the rights granted under the Agreement, the Company issued 29,633 shares (post reverse stock split) 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 according to an amendment to the original agreement.

During 2011 the Company paid $160,000 of the agreed sum. The exclusive rights under the agreement have been terminated and the remaining $840,000 obligation was written off.

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.

On November 21, 2011, the Company entered into a stock purchase agreement to purchase 477 shares of YGE Mining PLC. As payment for the 477 shares of YGE Mining PLC, the Company issued 20,000,000 shares of its unregistered common stock valued at $3,400,000.

On December 15, 2011, the Company entered an agreement with Ansalt Multicommertz, a limited liability company organized under the laws of Liechtenstein, pursuant to which the Assignor assigned to the Registrant its 90% interest in the Harrison Lake (Talc) Creek Magnesium property in exchange of the issuance of 25,000,000 restricted common stock of the Company to the Assignor. As part of the transaction the Company assumed an obligation to pay a vendor of Ansalt Multicommertz $400,000 of which $350,000 remained payable at December 31. 2012 and 2011.

As of December 31, 2012 the Company has determined that the carrying value of the investments may not be recoverable. Therefore, the Company has recorded an allowance for impairment to reduce the carrying value to zero.

(5) Convertible Notes Payable

On April 4, 2011, the Company signed a $25,000 convertible promissory note with a third party. The note bears interest at 8% per annum and was due on January 6, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. This note was paid by conversion to shares.

On May 12, 2011, the Company signed a $30,000 convertible promissory note with a third party. The note bears interest at 8% per annum and was due on February 12, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. This note was paid by conversion to shares.

On June 7, 2011, the Company signed a $32,500 convertible promissory note with a third party. The note bears interest at 8% per annum and was due on March 7, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. $18,000 of principal on the note was paid by conversion to shares. As of December 31, 2012 this note was in default. According to the terms of the note upon default the balance due is 150% of the unpaid principal balance. In addition, from the date of default the notes bear interest at 22% per annum. The investor may in its sole discretion convert the default amount into equity.

F-10

On November 18, 2011, the Company signed a $30,000 convertible promissory note with a third party. The note bears interest at 8% per annum and was due on August 18, 2012. The note has conversion rights that allow the holder of the note to convert after 180 days all or any part of the remaining principal balance into the Company’s common stock at a price equal to 58% of the average of the lowest three trading prices for the Common Stock during the most recent ten day period. As of December 31, 2012 this note was in default. According to the terms of the note upon default the balance due is 150% of the unpaid principal balance. In addition, from the date of default the notes bear interest at 22% per annum. The investor may in its sole discretion convert the default amount into equity.

As of December 31, 2012 and 2011, the balance of convertible notes payable was $113,191 and $77,355 net of unamortized discounts of $2,309 and $30,145, respectively.

(6) Common Stock

On November 13, 2007, the Company issued 116,667 shares (post reverse 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 50,000 (post reverse 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 50,000 (post reverse 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 50,000 (post reverse stock split) shares of its common stock, purchase price $0.03 per share, to 22 investors. The Company received net proceeds of $88,800.

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 29,633 (post reverse stock split) 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 10,417 (post reverse stock split) 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 417 (post reverse stock split) shares of its unregistered common stock on said date valued at $22,001. The fair value of the unregistered shares is determined based on the closing price of the Company’s stock on the date of grant less a 30% discount.

F-11

On September 16, 2009, the Company raised $120,000 and issued 5,000 (post reverse stock split) 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 4,017 (post reverse stock split) shares of its unregistered common stock valued at $84,350. The fair value of the unregistered shares was determined based on the closing price of the Company’s stock on the date of grant less a 30% discount.

On October 5, 2009, the Company raised $35,000 and issued 2,500 (post reverse stock split) 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 4,167 (post reverse stock split) shares of its unregistered common stock on said date valued at $58,750. The fair value of the unregistered shares was determined based on the closing price of the Company’s stock on the date of grant less a 30% discount.

On October 27, 2009, the Company entered into an agreement with a resigning Director to receive as compensation for his services, 11,667 (post reverse stock split) shares of its unregistered common stock valued at $147,000. The fair value of the unregistered shares was determined based on the closing price of the Company’s stock on the date of grant less a 30% discount.

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 1,667 (post reverse stock split) shares of its unregistered common stock on said date valued at $7,000. The fair value of the unregistered shares was determined based on the closing price of the Company’s stock on the date of grant less a 30% discount.

On January 12, 2010, the Company issued 26,667 (post reverse stock split) shares of its unregistered common stock valued at $56,000 to two directors of the Company. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On January 12, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for past services, the Company issued 13,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $28,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On February 3, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 33,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $70,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On February 16, 2010, the Company entered into an agreement with unrelated third-party consultants. As payment for the consultants' past services, the Company issued 11,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $23,800. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On February 25, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 33,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $70,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

F-12

On April 25, 2010, the Company raised $13,000 and issued 26,667 (post reverse stock split) shares of its common stock, with a purchase price $0.0016 per share, to investors.

On May 26, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 23,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $63,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On June 16, 2010, the Company entered into agreements with unrelated third-party consultants. As payment for the consultant’s past services, the Company issued 10,833 (post reverse stock split) shares of its unregistered common stock on said date valued at $13.975. The fair value of the unregistered shares was determined based on comparable sales.

On June 16, 2010, the Company raised $35,000 and issued 27,167 (post reverse stock split) shares of its common stock, with a purchase price $0.0043 per share, to investors.

On June 21, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 8,333 (post reverse stock split) shares of its unregistered common stock on said date valued at $22,500. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On August 13, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 37,000 (post reverse stock split) shares of its unregistered common stock on said date valued at $111,000. The fair value of the unregistered shares was determined based on comparable sales.

On August 30, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 16,667 (post reverse stock split) shares of its unregistered common stock on said date valued at $50,000. The fair value of the unregistered shares was determined based on comparable sales.

On August 31, 2010, the Company raised $10,000 and issued 33,333 (post reverse stock split) shares of its common stock, with a purchase price $0.001 per share, to investors.

On October 1, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 16,667 (post reverse stock split) shares of its unregistered common stock on said date valued at $24,500. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On October 18, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 49,833 (post reverse stock split) shares of its unregistered common stock on said date valued at $209,300. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

On December 15, 2010, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s past services, the Company issued 23,701 (post reverse stock split) shares of its unregistered common stock on said date valued at $49,420. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant less an approximate 30% discount.

F-13

On October 28, 2011, the Company implemented a 1 for 300 reverse stock split on its issued and outstanding shares of common stock to the holders of record as of October 28, 2011. After the reverse split, the number of shares of common stock issued and outstanding were 1,149,509 shares. The accompanying financial statements and related notes thereto have been adjusted accordingly to reflect this reverse stock split.

F-14

On December 1, 2011, the Company entered into an agreement with an unrelated third-party consultant. As payment for the consultant’s services, the Company issued 1,000,000 shares of its common stock on said date valued at $210,000. The fair value of the unregistered shares was determined based on the recent closing price of the Company’s stock on the date of grant.

From January 1, 2011 to December 31, 2011, the Company issued 236,224 shares of its common stock upon conversion of convertible debt of $85,000 and $4,071 of interest.

F-15

From January 1, 2012 to December 31, 2012, the Company issued 2,713,355 shares of its common stock upon conversion of convertible debt of $63,000 and $2,700 of interest.

(7) Income Taxes

The provision (benefit) for income taxes for the years ended December 31, 2012 and 2011 was as follows (assuming a 23% effective tax rate):

	2012			2011

Current Tax Provision:
Federal-
Net income	$	—		$	—
Non-deductible expenses		—			—
Taxable income		—			—

Net operating loss carryforward		—			—

Total current tax provision	$	—		$	—

Deferred Tax Provision:
Federal-
Deferred tax benefit on current loss	$	600,994		$	1,899,884
Non-deductible expenses		(39,415	)		(1,875,560	)
Change in valuation allowance		(561,579	)		(24,324	)

Total deferred tax provision	$	—		$	—

F-16

The Company had deferred income tax assets as of December 31, 2012 and 2011, as follows:

	2012			2011

Loss carryforwards	$	1,018,065		$	495,560
Less - Valuation allowance		(1,018,065	)		(495,560	)

Total net deferred tax assets	$	—		$	—

The Company provided a valuation allowance equal to the deferred income tax assets for the period ended December 31, 2012 and 2011, because it is not presently known whether future taxable income will be sufficient to utilize the loss carryforwards.

As of December 31, 2012, the Company had approximately $4,400,000 in tax loss carryforwards that can be utilized in future periods to reduce taxable income, and expire by the year 2032.

The Company did not identify any material uncertain tax positions. The Company did not recognize any interest or penalties for unrecognized tax benefits.

The Company has filed income tax returns in the United States. All tax years are closed by expiration of the statute of limitations.

(8) Related Party Transactions

On November 20, 2007, the Company issued 25,083 (post reverse stock split) shares of common stock to Mr. Aviram Malik, President and Director, for a cash payment of $150.

On November 20, 2007, the Company issued 8,333 (post reverse stock split) shares of common stock to Mr. Gal Ilivitzki, Secretary and Director, for a cash payment of $50.

For the year ended December 31, 2012, the Company expensed share based consulting fees of $1,088,572 and $190,429, respectively, to Directors and officers of the Company.

F-17

(9) Concentration of Credit Risk

The Company’s cash and cash equivalents are invested in a major bank in Israel and are not insured. Management believes that the financial institution that holds the Company’s investments is financially sound and accordingly, minimal credit risk exists with respect to these investments.

(10) Equity Purchase Agreement

Effective July 31, 2012, the Company entered into a Binding Letter of Intent with Southridge Partners II LP, an institutional investor, for the equity purchase agreement of an amount of up to $7 million. Pursuant to the agreement, the Company has the right, in its sole discretion, to sell to Southridge up to $7 million of its common stock over a 24-month period. The Company will have the right, but is not obligated, to sell stock to Southridge depending on certain conditions as set forth in the equity purchase agreement.

F-18