See accompanying notes to unaudited consolidated financial statements.

ADM Endeavors, Inc.

and Subsidiaries

Consolidated Statements of Cash Flows

For the SixThree Months Ended June 30,March 31,

(unaudited)(Unaudited)

See accompanying notes to unaudited consolidated financial statements.

ADM ENDEAVORS, INC.

and Subsidiaries

Notes to the Consolidated Financial Statements

June 30, 2020March 31, 2021

(unaudited)

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

On January 4, 2001, we incorporated in North Dakota as ADM Enterprises, Inc. On May 9, 2006, the Company changed both its name to ADM Endeavors, Inc. (“ADM Endeavors,” or the “Company,” “we,” “us,” or “our”) and its domicile to the state of Nevada. On July 1, 2008, the Company acquired all of the assets of ADM Enterprises, LLC (“ADM Enterprises”), a sole proprietorship owned by Ardell and Tammera Mees, in exchange for 10,000,000 newly issued shares of our common stock. As a result, ADM Enterprises became a wholly owned subsidiary of the Company. Even though the Company was incorporated on January 4, 2001, it had no operations until the share exchange agreement with ADM Enterprises on July 1, 2008. ADM provides installation services to grocery décor and design companies primarily in North Dakota.

In May 2013, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized common stock increased to 800,000,000 shares at a par value of $0.001 per share and preferred stock increased to 80,000,000 shares at a par value of $0.001 per share.

On April 19, 2018, the Company acquired Just Right Products, Inc. (“JRP”), a Texas corporation. JRP was incorporated on January 17, 2010. The acquisition of 100% of JRP from its sole shareholder was through a stock exchange whereas the Company issued 2,000,000 shares of restricted Series A preferred stock (the “Acquisition Shares”). Each share of the Series A preferred stock is convertible into ten shares of common stock and each share has 100 votes on a fully diluted basis. The Acquisition Shares represents 61% of voting shares, thus there is a change of voting control. The transaction was accounted for as a reverse acquisition.

JRP is focused on being an added value reseller with concentration in embroidery, screen printing, importing and uniforms for businesses, schools and individuals in the State of Texas.

On January 1, 2020, the Company determined that it would discontinue its business operations in North Dakota, specifically, ADM Enterprises (the “Disposed Company”). The Company has madereached a settlement with Ardell Mees to provide him with the assets of the Disposed Company and in exchange, Mr. Mees will assume all liabilities of the Disposed Company. As part of the transaction, Mr. Mees resigned from all positions with the Company and, in a private transaction, sold a significant portion of his ownership in the Company to Marc Johnson. The Company and Mr. Mees entered into an indemnification agreement whereby Mr. Mees indemnified the Company for any liabilities of the Disposed Company.

The Company has been affected negatively by COVID-19 as a significant portion of the Company’s sales are for school uniforms which, due to COVID-19 and the closing of schools nationwide, should have a negative impact on the Company’s financials. Additionally, the Company experienced delivery delays have been seen induring the first quarter of 2020 due to slowed production in China due to COVID-19, but management does not expect this will significantly impact gross sales due to the diverse growth the Company is experiencing.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company follows the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP) and has a year-end of December 31.

Management further acknowledges that it is solely responsible for adopting sound accounting practices, establishing and maintaining a system of internal accounting control and preventing and detecting fraud. The Company’s system of internal accounting control is designed to assure, among other items, that 1) recorded transactions are valid; 2) valid transactions are recorded; and 3) transactions are recorded in the proper period in a timely manner to produce financial statements which present fairly the financial condition, results of operations and cash flows of the Company for the respective periods being presented.

The unaudited consolidated financial statements of the Company for the sixthree month periods ended June 30,March 31, 2021 and 2020 and 2019 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-K. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. However, such information reflects all adjustments (consisting solely of normal recurring adjustments), which are, in the opinion of management, necessary for the fair presentation of the financial position and the results of operations. Results shown for interim periods are not necessarily indicative of the results to be obtained for a full fiscal year. The balance sheet information as of December 31, 20192020 was derived from the audited financial statements included in the Company’s financial statements as of and for the year ended December 31, 20192020 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on May 13, 2020.March 24, 2021. These financial statements should be read in conjunction with that report.

Principles of Consolidation

The accompanying unaudited consolidated financial statements include all of the accounts of the Company and its wholly owned subsidiary, JRP, at June 30, 2020.March 31, 2021. All significant intercompany balances and transactions have been eliminated.

Use of Estimates

The preparation of the Consolidated Financial Statements in accordance with U.S. GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported periods. The Company bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Significant estimates are related to allowance for doubtful accounts, goodwill, derivative liability, stock-based compensation and deferred tax valuations.

Stock-Based Compensation

Stock-based compensation expense is recorded in accordance with FASB ASC Topic 718, Compensation – Stock Compensation, for stock and stock options awarded in return for services rendered. The expense is measured at the grant-date fair value of the award and recognized as compensation expense on a straight-line basis over the service period, which is the vesting period. The Company estimates forfeitures that it expects will occur and records expense based upon the number of awards expected to vest.

Cash Equivalents

The Company considers all highly liquid investments with an original maturity of sixnine months or less when purchased to be cash equivalents. At June 30, 2020March 31, 2021 and December 31, 2019,2020, the Company had no cash equivalents. Included in assets attributable to discontinued operations is $0 and $12,758 of cash as of June 30, 2020 and December 31, 2019, respectively.

Allowance for Doubtful Accounts

The Company establishes an allowance for doubtful accounts to ensure trade and notes receivable are not overstated due to non-collectability.noncollectability. The Company’s allowance is based on a variety of factors, including age of the receivable, significant one-time events, historical experience, and other risk considerations. The Company had anno allowance at June 30, 2020March 31, 2021 and December 31, 2019 of $0.2020. The Company had bad debt expense of $1,070$559 and $5,136$0 for the sixthree months ended June 30,March 31, 2021 and 2020, and 2019, respectively.

Inventory

Inventory is valued at the lower of cost or net realizable value. Cost is determined using a weighted-average cost method. The Company decreases the value of inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value, based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, and assumptions about future demand and market conditions. The Company has inventory of $226,451$152,948 and $138,693$207,576 as of June 30, 2020March 31, 2021 and December 31, 2019,2020, respectively.

Four vendors accounted for approximately 98% of inventory purchases during the three months ended March 31, 2021. Three vendors accounted for approximately 68%94% of inventory purchases during the sixthree months ended June 30, 2020, respectively.March 31, 2020. These same vendors made up 0%36% and 0% of our accounts payable as of June 30, 2020March 31, 2021 and December 31, 2019,2020, respectively.

Derivative Instruments

Derivatives are measured at their fair value on the balance sheet. In determining the appropriate fair value, the Company uses the Black-Scholes-Merton option pricing model. Changes in fair value are recorded in the consolidated statements of operations.

Fair Value of Financial Instruments

The Company measures its financial assets and liabilities in accordance with U.S. GAAP. For certain of our financial instruments, including cash, accounts payable, accrued expenses, and short-term loans the carrying amounts approximate fair value due to their short maturities.

We follow accounting guidance for financial and non-financial assets and liabilities. This standard defines fair value, provides guidance for measuring fair value and requires certain disclosures. This standard does not require any new fair value measurements, but rather applies to all other accounting pronouncements that require or permit fair value measurements. This guidance does not apply to measurements related to share-based payments. This guidance discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

The Company adopted the provisions of FASB ASC 820 (the “Fair Value Topic”) which defines fair value, establishes a framework for measuring fair value under U.S. GAAP, and expands disclosures about fair value measurements.

The Company had no assets or liabilities other than derivative liabilities measured at fair value on a recurring basis at June 30, 2020March 31, 2021 and December 31, 2019.2020.

Fixed Assets

Fixed assets are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method over the assets estimated useful life. Upon the sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in consolidated statements of operations.

Goodwill

Goodwill represents the excess of purchase price and related costs over the value assigned to the net tangible assets of businesses acquired. Goodwill is not amortized, but instead assessed for impairment. We perform our annual impairment review of goodwill in our fiscal fourth quarter or when a triggering event occurs between annual impairment tests. No impairment was recorded in fiscal 20192021 or 2020 as a result of our qualitative assessments over our single reporting segment.

The Company performs a qualitative assessment for each of its reporting units to determine if the two-step process for impairment testing is required. If the Company determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company would then evaluate the recoverability of goodwill using a two-step impairment test approach at the reporting unit level. In the first step, the fair value for the reporting unit is compared to its book value including goodwill. In the case that the fair value of the reporting unit is less than book value, a second step is performed which compares the implied fair value of the reporting unit’s goodwill to the book value of the goodwill. The fair value for the goodwill is determined based on the difference between the fair values of the reporting unit and the net fair values of the identifiable assets and liabilities of such reporting unit. If the implied fair value of the goodwill is less than the book value, the difference is recognized as impairment.

Impairment of Long-lived Assets

The Company follows paragraph 360-10-05-4 of the FASB Accounting Standards Codification for its long-lived assets. The Company’s long-lived assets, such as intellectual property, are required to be reviewed for impairment annually, or whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

The Company assesses the recoverability of its long-lived assets by comparing the projected undiscounted net cash flows associated with the related long-lived asset or group of long-lived assets over their remaining estimated useful lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over the fair value of those assets. Fair value is generally determined using the asset’s expected future discounted cash flows or market value, if readily determinable. If long-lived assets are determined to be recoverable, but the newly determined remaining estimated useful lives are shorter than originally estimated, the net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives.

The Company determined that there were no impairments of long-lived assets at June 30, 2020March 31, 2021 and December 31, 2019.2020.

Revenue Recognition

We recognize revenue for merchandise sales, net of expected returns and sales tax, at the time of in-store purchase or delivery of the product to our customer. When merchandise is shipped to our guests, we estimate receipt based on historical experience. Revenue is deferred and a liability is established for sales returns based on historical return rates and sales for the return period. We recognize an asset and corresponding adjustment to cost of sales for our right to recover returned merchandise. At each financial reporting date, we assess our estimates of expected returns, refund liabilities and return assets. For merchandise sold in our stores and online, tender is accepted at the point of sale. When we receive payment before the guest has taken possession of the merchandise, the amount received is recorded as deferred revenue until the transaction is complete. Our performance obligations for unfulfilled merchandise orders are typically satisfied within one week. Shipping and handling fees charged to guests relate to fulfilment activities and are included in net sales with the corresponding costs recorded in cost of sales.

We provided consulting services from our discontinued operations which were minimal for the six months ended June 30, 2019.

Cost of Sales

Cost of sales includes the actual cost of merchandise sold and services performed; the cost of transportation of merchandise from vendors to our distribution network, stores, or customers; shipping and handling costs from our stores or distribution network to customers; and the operating cost and depreciation of our sourcing and distribution network and online fulfilment centers.

Net Income (Loss) per Share

The Company computes basic and diluted income (loss) per share amounts pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic lossincome per share is computed by dividing net lossincome available to common shareholders, by the weighted average number of shares of common stock outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted lossincome per share is computed by dividing net lossincome available to common shareholders by the diluted weighted average number of shares of common stock during the period. The diluted weighted average number of common shares outstanding is the basic weighted number of shares adjusted as of the first day of the year for any potentially diluted debt or equity.

The dilutive effect of outstanding convertible securities and preferred stock is reflected in diluted earnings per share by application of the if-converted method.

The following is a reconciliation of basic and diluted earnings (loss) per common share for the sixthree months ended June 30, 2020March 31, 2021 and 2019:2020:

Income Taxes

The Company accounts for income taxes in accordance with FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statements carrying amounts of existing assets and liabilities and loss carryforwards and their respective tax bases.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income (loss) in the years in which those temporary differences are expected to be recovered or settled.

The effect of a change in tax rules on deferred tax assets and liabilities is recognized in operations in the year of change. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

Tax benefits of uncertain tax positions are recognized only if it is more likely than not that the Company will be able to sustain a position taken on an income tax return. The Company has no liability for uncertain tax positions as of June 30, 2020March 31, 2021 and December 31, 2019.2020. Interest and penalties, if any, related to unrecognized tax benefits would be recognized as interest expense. The Company does not have any accrued interest or penalties associated with unrecognized tax benefits, nor was any significant interest expense recognized during the periods ended June 30, 2020March 31, 2021 and 2019.2020.

Segment Information

In accordance with the provisions of ASC 280-10, “Disclosures about Segments of an Enterprise and Related Information,” the Company is required to report financial and descriptive information about its reportable operating segments. The Company has one operating segment as of June 30, 2020March 31, 2021 and December 31, 2019.2020.

Effect of Recent Accounting Pronouncements

Recently Issued Accounting Standards Not Yet Adopted

The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that no other pronouncements will have a significant effect on its financial statements.

NOTE 3 – GOING CONCERN

The accompanying unaudited financial statements and the factors within it, have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business and the ability of the Company to continue as a going concern for a reasonable period of time. The Company had a net income of $34,179$19,258 and cash used inprovided by operating activities of $125,701$144,761 for the sixthree months ended June 30, 2020.March 31, 2021. As of June 30, 2020,March 31, 2021, the Company had a working capital surplusdeficit of $304,554,$222,132, and retained earnings of $135,577.$97,369. The Company’s continuation as a going concern is dependent upon its ability to generate revenues and its ability to continue receiving investment capital and loans from third parties to sustain its current level of operations. The Company is in the process of securing working capital from investors for common stock, convertible notes payable, and/or strategic partnerships. No assurance can be given that the Company will be successful in these efforts. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

NOTE 4 – COMMITMENTS AND CONTINGENCIES

Legal Matters

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of July 28, 2020,May __,  2021, there were no pending or threatened lawsuits.

Franchise Agreement

The Company has a franchise agreement effective February 19, 2014 expiring in February 2024, with a right to renew for an additional 5 years to operate stores and websites in the Company’s exclusive territory. The Company is obligated to pay 5% of gross revenue for use of systems and manuals.

During the sixthree months ended June 30,March 31, 2021 and 2020 and 2019, the Company paid $4,236$4,810 and $10,382,$4,236, respectively, for the franchise agreement.

Uniform Supply Agreement

The Company has an agreement to be the exclusive provider of school uniforms and logos for a charter school. The Company is obligated to provide a 3% donation to the charter school for each school year. The agreement is for each school year ending through May 31, 2021.

During the sixthree months ended June 30,March 31, 2021 and 2020, and 2019, the Company paid $0 and $0 for the uniform supply agreement, respectively.agreement.

NOTE 5 – FIXED ASSETS

Fixed assets and finance lease right of use assets, stated at cost, less accumulated depreciation at June 30, 2020March 31, 2021 and December 31, 20192020 consisted of the following:

Depreciation expense for the sixthree months ended June 30,March 31, 2021 and 2020 was $16,431 and 2019 was $33,638 and $23,637,$16,817, respectively.

NOTE 6 – CONVERTIBLE NOTE PAYABLE AND NOTES PAYABLE

Convertible Notes Payable

On April 1, 2018, the Company assumed a convertible promissory note in connection with the reverse acquisition. The funding was in tranches whereby the Company assumed the first tranche of $48,697. The Company received the remaining tranches totaling $57,395 during the year ended December 31, 2018. The Company received total funding of $106,092 as of December 31, 2018. The note had fees of $53,046 which were recorded as a discount to the convertible promissory note and are being amortized over the life of the loan using the effective interest method. The Company recorded interest expenseoriginal maturity of $0 during the six months ended June 30,note was March 5, 2019 and at that time, the note was extended to March 5, 2020. In March 2020, the note was extended to March 5, 2021. Subsequent to March 5, 2021, the note was extended to March 5, 2022.

The note is convertible into common stock at a price of 35% of the lowest three trading prices during the ten days prior to conversion. As of June 30, 2020,March 31, 2021, the convertible debt would convert to 5,511,2733,836,962 common shares.

The note balance was $106,092 as of June 30, 2020March 31, 2021 and December 31, 2019.2020.

Derivative liabilities

The conversion features embedded in the convertible notes were evaluated to determine if such conversion feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. In the convertible notes with variable conversion terms, the conversion feature was accounted for as a derivative liability. The derivatives associated with the term convertible notes were recognized as a discount to the debt instrument and the discount is amortized over the expected life of the notes with any excess of the derivative value over the note payable value recognized as additional interest expense at the issuance date.

The following table presents information about the Company’s liabilities measured at fair value on a recurring basis and the Company’s estimated level within the fair value hierarchy of those assets and liabilities as of March 31, 2021 and December 31, 2020:

As of March 31, 2021 and 2020, the derivative liability was calculated using the Black-Scholes method over the expected terms of the convertible debt with aand the following assumptions: volatility of 100%, exercise price of $0.0277 and $0.0265, risk-free rate of 0.07% and 0.17% and, volatility of 100% as of June 30, 2020.respectively. Included in Derivative Incomederivative income (loss) in the accompanying unaudited consolidated statements of operations is expenseincome (expense) arising from the change in fair value of the derivatives gain of $6,371$14,403 and loss of $10,917 during the sixthree months ended June 30, 2020.March 31, 2021 and 2020, respectively.

Notes Payable

On April 5, 2020, the Company received a Small Business Administration (“SBA”) loan under the government’s assistance related to COVID-19. The SBA loan was for $169,495 with an interest rate of 0.98% and due in eight weeks. The SBA loan is to assist the Company in payroll during the COVID-19 time period. The SBA loan is forgivable if the Company payroll during this time utilizes all of the monies provided.

On April 29, In 2020, the Company receivedapplied for loan forgiveness under the government assistance checkprovisions of $10,000 relatedSection 1106 of the CARES Act. The forgiveness applications will be reviewed by both the lending bank and SBA and a loan forgiveness amount, if any, will be determined. There can be no assurance, however, that any of the loan to the COVID-19 response byCompany will be forgiven, or if forgiven, the government to assist companies duringamount of such forgiveness. As of March 31, 2021, the pandemic.

NOTE 7 – FINANCE LEASES

Company has not received a decision from the SBA or lending bank regarding the forgiveness of the loan.

On November 17, 2016,October 16, 2020, the Company obtained a finance lease for equipment. Payments are $2,667 per month for three yearsentered into an unsecured promissory note in the amount of $372,000. The note bears interest at 5% and is due on October 16, 2021. As of March 31, 2021 and December 31, 2020, the leasenote balance was paid off$321,303 and $354,203 with accrued interest of $3,279 and $0 included in 2019.accrued expenses, respectively.

NOTE 87 – ACCRUED EXPENSES

The Company had total accrued expenses of $156,971$218,821 and $201,790$172,923 as of June 30, 2020March 31, 2021 and December 31, 2019,2020, respectively. See breakdown below of accrued expenses as follows:

NOTE 98 – RELATED PARTY TRANSACTIONS

The majority shareholder, director and officer, is the owner of M & M Real Estate, Inc. (“M & M”). M & M leases the Haltom City, Texas facility to the Company. The monthly lease payment, under a month to month lease, is currently $6,500. The Company incurred lease expense of $39,000 and $39,000, respectively,$19,500 to M & M for the sixthree months ended June 30, 2020March 31, 2021 and 2019, respectively.2020.

The Company has accounts payable to M&M of $0$1,200 and $0 as of June 30, 2020March 31, 2021 and December 31, 2019,2020, respectively. The accounts payable is for unpaid lease obligations and productsrelated to rent the Company purchased fromowes M&M   for two employees renting space during the sixthree months ended June 30,March 31, 2021 and 2020, and 2019, respectively. The Company purchased approximately $0 and $14,060, respectively. M&M marks up their sales to JRP by 10%.

The Company has been provided office spaceOn July 28, 2020, Just Right Products, Inc., a wholly owned subsidiary of ADM Endeavors, Inc. (collectively, the “Company”) entered into an asset purchase agreement (the “APA”) with M&M Real Estate, Inc. (“M&M”). M&M is owned by its chief executive officer, Ardell Mees, at no cost. Management has determined that such cost is nominal and did not recognize the rent expense in its financial statements.

The Company had expenses of approximately $15,985 related to Ardell Mees and family for the year ended December 31, 2019, respectively. These expenses are considered compensation and are included in discontinued operations.

In April 2020, Marc Johnson advanced $40,000 to the Company. The advance was repaid in May 2020.

Employment and Consulting Agreements

In April 2018, the Company executed a two-year employment agreement with Ardell D. Mees, the Company’s Chief Executive Officer and Chief Financial Officer. As compensation for services, Mr. Mees is to receive an annual base salary of $60,000. On December 31, 2019, Mr. Mees waived all balances due to him.

In April 2018, the Company executed a two-year employment agreement with Marc Johnson, the Company’s Chief Operating Officer. As compensation for services, Mr. Johnson is to receive an annual base salary of $60,000. On December 31, 2019, Mr. Johnson waived all balances due to him.

On May 1, 2018, the Company entered into a consulting agreement for financial servicesCEO, CFO and business development for a term of one year and agreed to issue 2,250,000 common shares earned on a monthly basis to a former officer’s family member. On January 9, 2019, the Company issued the shares of common stock.Chairman. The Company incurred stock compensation expenseutilized the APA to acquire 10.4 acres of $0land with a cost basis of $498,000 from M&M. It is anticipated that this land will be used this year for the six months ended June 30, 2020construction of the Company’s corporate office and $112,500 asexpanded operational facilities. The Company compensated M&M in the amount of June 30, 2019. In 2020 the Company issued 4,500,00022,232,143 shares of common stock related toof the current and prior agreements.Company.

On February 28, 2019,A Consultant engaged by the Company entered intoin 2020 is the owner of 24.7.365 Hockey, Inc., a consulting agreementcustomer of the Company. During the three ended March 31, 2020  , 24.7.365 Hockey, Inc. made up approximately 0% of revenue, respectively. As of March 31, 2021 and December 31, 2020, 24.7.365 Hockey, Inc. accounted for financial services0% and business development for a term62% of six monthsaccounts receivable, respectively.

Employment and issued 1,500,000 common shares earned on a monthly basis. On February 28, 2019, the Company issued the shares of common stock. The Company incurred stock compensation expense of $0 for the six months ended June 30, 2020 and $25,000 as of June 30, 2019.Consulting Agreements

On January 9, 2020, Motasem Khanfur, the controller of the Company, was appointed as chief financial officer of the Company. As part of his compensation, Mr. Khanfur was awarded 500,000 shares of common stock.

On January 9, 2020, Sarah Nelson was appointed as chief operating officer and director of the Company. As part of her compensation, Ms. Nelson was awarded 1,000,000 shares of common stock.

On January 9, 2020, Andreana McKelvey resigned as director. She was awarded 250,000 shares of common stock of the Company.

On May 30, 2020, the Company entered into a consulting agreement for financial services and business development for a term of one year and agreed to issue 2,250,000 common shares earned on the date of issuance.

NOTE 109 – STOCKHOLDERS’ EQUITY

Our Articles of Incorporation authorize the issuance of 800,000,000 shares of common stock and 80,000,000 shares of preferred stock with $0.001 par values per share. There were 140,920,000 and 136,920,000163,652,143 outstanding shares of common stock at June 30, 2020March 31, 2021 and December 31, 2019, respectively.2020. There were 2,000,000 outstanding shares of preferred stock as of June 30, 2020March 31, 2021 and December 31, 2019,2020, respectively. Each share of preferred stock has 100 votes per share and is convertible into 10 shares of common stock. The preferred stock pays dividends equal with common stock and has preferential liquidation rights to common stockholders.

On May 1, 2018, the Company entered into a consulting agreement for financial services and business development for a term of one year and agreed to issue 2,250,000 common shares earned on a monthly basis to an officer’s family member. On January 9, 2019, the Company issued the shares of common stock. The Company incurred stock compensation expense of $0 for the six months ended June 30, 2020 and $112,500 as of June 30, 2019. In 2020 the Company issued 4,500,000 shares of common stock related to the current and prior agreements.

On January 28, 2019, the Company entered into a consulting agreement for 6 months and agreed to issue 1,500,000 common shares vesting on a monthly basis. The shares were issued on February 28, 2019. The Company incurred stock compensation expense of $0 for the six months ended June 30, 2020 and $25,000 as of June 30, 2019.

On January 9, 2020, Motasem Khanfur, the controller of the Company, was appointed as chief financial officer of the Company. As part of his compensation, Mr. Khanfur was awarded 500,000 shares of common stock. The Company recorded $10,000 as stock-based compensation.

On January 9, 2020, Sarah Nelson was appointed as chief operating officer and director of the Company. As part of her compensation, Ms. Nelson was awarded 1,000,000 shares of common stock. The Company recorded $20,000 as stock-based compensation.

On January 9, 2020, Andreana McKelvey resigned as director. She was awarded 250,000 shares of common stock of the Company. The Company recorded $5,000 as stock-based compensation.

On April 24, 2020, the Company entered into a consulting agreement for financial services and agreed to issue 650,000 shares of common stock. The shares were valued at $65,000 and were expensed.

On May 30, 2020, the Company entered into a consulting agreement for financial services and business development for a term of one year and agreed to issue 2,250,000 common shares earned on the date of issuance. The Company will amortize the stock compensation on a monthly basis in the amount of $13,125. As of June 30, 2020, the Company has recorded an expense of $13,125.

NOTE 1110 – CONCENTRATION OF CUSTOMERS

Concentration of Revenue

For the sixthree months ended June 30, 2020,March 31, 2021, one customer made up 55% of revenues and for the sixthree months ended June 30, 2019 one customerMarch 31, 2020 two customers made up 19%55% of revenues, respectively. Three customersOne customer accounted for 63%42% of accounts receivable as of June 30,March 31, 2020. There were no customers that accounted for more than 10% of accounts receivable as of December 31, 2019.2020.

NOTE 1211 – LEASE LIABILITY

Finance Leases

Finance leases are included in finance lease right-of-use lease assets and finance lease liability current and long-term debt on the consolidated balance sheets. The associated amortization expense and interest expense are included in depreciation and amortization and interest expense, respectively, on the consolidated income statements.

Operating Leases

The Company leases office space. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Leases with initial terms in excess of 12 months are recorded as operating or financing leases in our consolidated balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. For leases beginning in 2018 and later, the Company accounts for lease components separately from the non-lease components. Most leases include one or more options to renew. The exercise of the lease renewal options is at the sole discretion of the Company. The depreciable life of the assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

The Company leases approximately 18,000 square feet of space in Haltom City, Texas, pursuant to a month to month lease. This facility serves as our corporate headquarters, manufacturing facility and showroom. The lease is with M & M Real Estate, Inc. (“M & M”), a company owned solely by our majority shareholder and director of the Company.

The Company has approximately 6,000 square feet of space in Arlington, Texas which serves as an academic showroom, pursuant to a lease that expired on June 1, 2020. The Company is leasing this space on a month-to-month basis beginning June 1, 2020.

As of June 30, 2020, the operating lease right-of-use assets and operating lease liabilities were $0. Operating lease expense during the six months ended June 30, 2020 was $35,961 and was included as part of operating expenses.

NOTE 1312 – DISCONTINUED OPERATIONS

On January 1, 2020, the Company determined that it would discontinue its business operations in North Dakota, specifically, ADM Enterprises LLC (the “Disposed Company”). The Company has made a settlement with Ardell Mees to provide him with the assets of the Disposed Company and in exchange, Mr. Mees will assume all liabilities of the Disposed Company. As part of the transaction, Mr. Mees resigned from all positions with the Company and, in a private transaction, sold a significant portion of his ownership in the Company to Marc Johnson. The Company and Mr. Mees entered into an indemnification agreement whereby Mr. Mees indemnified the Company for any liabilities of the Disposed Company.

Reconciliation of the Items Constituting Profit and (Loss)

from Discontinued Operations

For the SixThree Months Ended June 30,March 31,

(unaudited)

NOTE 14 – SUBSEQUENT EVENTS

The Company has evaluated subsequent events through the date the financial statements were issued and filed with the Securities and Exchange Commission. The Company has determined that there are no other such events that warrant disclosure or recognition in the financial statements, except as stated herein.

The outbreak of the coronavirus (COVID-19) resulted in increased travel restrictions, and shutdown of businesses, which may cause slower recovery of the economy. We may experience impact from quarantines, market downturns and changes in customer behavior related to pandemic fears and impact on our workforce if the virus continues to spread. In addition, one or more of our customers, partners, service providers or suppliers may experience financial distress, delayed or defaults on payment, file for bankruptcy protection, sharp diminishing of business, or suffer disruptions in their business due to the outbreak. The extent to which the coronavirus impacts our results will depend on future developments and reactions throughout the world, which are highly uncertain and will include emerging information concerning the severity of the coronavirus and the actions taken by governments and private businesses to attempt to contain the coronavirus. It is likely to result in a potential material adverse impact on our business, results of operations and financial condition. Wider-spread COVID-19 globally could prolong the deterioration in economic conditions and could cause decreases in or delays in advertising spending and reduce and/or negatively impact our short-term ability to grow our revenues. Any decreased collectability of accounts receivable, bankruptcy of small and medium businesses, or early termination of agreements due to deterioration in economic conditions could negatively impact our results of operations.

On July 28, 2020, Just Right Products, Inc., a wholly owned subsidiary of ADM Endeavors, Inc. (collectively, the “Company”) entered into an asset purchase agreement (the “APA”) with M&M Real Estate, Inc. (“M&M”). M&M is owned by Marc Johnson, the Company’s CEO, CFO and Chairman. The Company utilized the APA to acquire 10.4 acres of land with a cost basis of $498,000 from M&M. It is anticipated that this land will be used this year for the construction of the Company’s corporate office and expanded operational facilities. The Company compensated M&M in the amount of 22,232,143 shares of common stock of the Company.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OR PLAN OF OPERATION

SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS

We believe that it is important to communicate our future expectations to our security holders and to the public. This report, therefore, contains statements about future events and expectations which are “forward-looking statements” within the meaning of Sections 27A of the Securities Act of 1933 and 21E of the Securities Exchange Act of 1934, including the statements about our plans, objectives, expectations and prospects under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You can expect to identify these statements by forward-looking words such as “may,” “might,” “could,” “would,” “will,” “anticipate,” “believe,” “plan,” “estimate,” “project,” “expect,” “intend,” “seek” and other similar expressions. Any statement contained in this report that is not a statement of historical fact may be deemed to be a forward-looking statement. Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved.

Important factors that might cause our actual results to differ materially from the results contemplated by the forward-looking statements are contained in the “Risk Factors” section of and elsewhere in our Annual Report on Form 10-K for the fiscal year ended December 31, 20192020 and in our subsequent filings with the Securities and Exchange Commission. The following discussion of our results of operations should be read together with our financial statements and related notes included elsewhere in this report.

Company Overview

We began operations in 1988, under the ownership and control of Ardell Mees, who provided installation services to grocery decor design companies. As our reputation for excellent workmanship has grown, we have expanded our operations to serve a larger geographic region. On January 4, 2001, we incorporated in North Dakota as ADM Enterprises, Inc. On May 9, 2006, the Company changed both its name to ADM Endeavors, Inc. (“ADM Endeavors,” or the “Company,” “we,” “us,” or “our”) and its domicile to the state of Nevada. On July 1, 2008, the Company acquired all of the assets of ADM Enterprises, LLC (“ADM Enterprises”), a sole proprietorship owned by Ardell and Tammera Mees, in exchange for 10,000,000 newly issued shares of our common stock. As a result, ADM Enterprises became a wholly owned subsidiary of Company. Even though the Company was incorporated on January 4, 2001, it had no operations until the share exchange agreement with ADM Enterprises on July 1, 2008. All business operations are those solely of the Company’s wholly owned subsidiary, ADM Enterprises.

In May 2013, the Company amended its Articles of Incorporation to provide for an increase in its authorized share capital. The authorized common stock increased to 800,000,000 shares at a par value of $0.001 per share and preferred stock increased to 80,000,000 shares at a par value of $0.001 per share.

On January 1, 2020, the Company determined that it would discontinue its business operations in North Dakota, specifically, ADM Enterprises (the “Disposed Company”). The Company has made a settlement with Ardell Mees to provide him with the assets of the Disposed Company and in exchange, Mr. Mees will assume all liabilities of the Disposed Company. As part of the transaction, Mr. Mees resigned from all positions with the Company and, in a private transaction, sold a significant portion of his ownership in the Company to Marc Johnson. The Company and Mr. Mees entered into an indemnification agreement whereby Mr. Mees indemnified the Company for any liabilities of the Disposed Company.

The Company has been affected negatively by COVID-19 as a significant portion of the Company’s sales are for school uniforms which, due to COVID-19 and the closing of schools nationwide, should have a negative impact on the Company’s financials. Additionally, delivery delays have been seen in the first quarter of 2020 due to slowed production in China due to COVID-19, but management does not expect this will significantly impact gross sales due to the diverse growth the Company is experiencing.

For the Three Months Ended June 30,March 31, 2021 and 2020 and 2019

Revenues

Our revenue was $1,051,980$1,147,452 for the three months ended June 30, 2020,March 31, 2021, compared to $989,629$880,782 for the three months ended June 30, 2019March 31, 2020 for continuing operations, resulting in an increase of $62,351,$266,670, or 6.3%30.3%. The increase is primarily due to growth in the business through the usenew government customers and a return of a new marketing technique and the conversion of productsexisting customers. The negative COVID19 effect on sales seems to adapt for the effect of COVID-19.be declining.

Operating Expenses

Direct costs of revenues were $426,874$654,918 and $418,468$570,349 (for continuing operations) for the three months ended June 30,March 31, 2021 and 2020, and 2019, respectively, resulting in an increase of $8,406,$84,569, or 2.0% due to the14.8% . This increase was a direct result of increased sales with a minimal increase in revenue which is the result of a new marketing technique and the effect of the conversion of products to adapt for the effect of COVID-19.fixed expenses. The gross margin increased from 57.7%35.2% as of June 30, 2019March 31, 2020 to 59.4%42.9% as of June 30, 2020.March 31, 2021. The increase in margin is relateddue to the growth in revenues.a lower cost needed to obtain new sales.

For the three months ended June 30, 2020, our generalGeneral and administrative expenses and marketing and selling expenses were $622,335 compared to $486,306 for continuing operations$407,767 for the three months ended June 30, 2019, resultingMarch 31, 2021 compared to $343,867 for the same period in an increase of $136,029 or 28.0%.2020. The increase was primarily due to the increase ofin 2021 in general and administrative expenses from $317,112was approximately 18.6% primarily due to $480,929 offset byoperational growth.

Marketing and selling expenses were $64,560 for the decreasethree months ended March 31, 2021 compared to $25,259 for the same period in stock-based compensation from $131,2502020. The increase in 2021 in marketing and selling expenses was approximately 155.6% primarily due to $78,125.new marketing technique.

As a result, net income from continuing operations was $7,154$19,258 for the three months ended June 30, 2020,March 31, 2021, compared to net incomeloss for continuing operations of $81,535$69,610 for the three months ended June 30, 2019.

For the Six Months Ended June 30, 2020 and 2019March 31, 2020.

RevenuesDiscontinued Operations

Our revenue was $1,932,762The net income from discontinued operations for the sixthree months ended June 30,March 31, 2020 compared to $1,515,103 for the six months ended June 30, 2019 for continuingwas $96,635. Net income from discontinued operations resulting in an increase of $417,659, or 27.6%. The increase is primarily due to growth in the business through the use of a new marketing technique and the effect of the conversion of products to adapt for the effect of COVID-19.

Operating Expenses

Direct costs of revenues were $997,223 and $626,897 (for continuing operations) for the six months ended June 30, 2020 and 2019, respectively, resulting in an increase of $370,326, or 59.1% due to the increase in revenue which is the result of a new marketing technique and the effect of the conversion of products to adapt for the effect of COVID-19. The gross margin decreased from 58.6% as of June 30, 2019 to 48.4% as of June 30, 2020. The decrease is related to the increase in revenues and the increase in direct costsgain on disposal of revenue as a higher percent of revenue.ADM Enterprises, Inc.

For the six months ended June 30, 2020, our general and administrative expenses and marketing and selling expenses were $991,461 compared to $834,102 for continuing operations for the six months ended June 30, 2019, resulting in an increase of $157,359 or 18.9%. The increase is primarily due to the increase in general and administrative expenses from $615,146 to $789,796 offset by the decrease in stock-based compensation of approximately $113,125 from $141,875 for the six months ended June 30, 2020 and 2019, respectively.

As a result, net loss from continuing operations was $62,456 for the six months ended June 30, 2020, compared to net income for continuing operations of $37,309 for the six months ended June 30, 2019.

Liquidity and Capital Resources

Liquidity Liquidity and CapitalCapital Resources during during the sixthree months ended June 30, 2020 comparedMarch 31, 2021 compared to the sixthree months ended June 30, 2019March 31, 2020

We had cash provided by operations of $144,761 for the three months ended March 31, 2021, compared to cash used in operations of $125,701$240,050 for the sixthree months ended June 30, 2020, compared to cash provided by operations of $23,918 for the six months ended June 30, 2019.March 31, 2020. The decreaseincrease in positive cash flow from operating activities for the sixthree months ended June 30,March 31, 2021 is attributable to accounts receivables, related party and inventory. Cash used in operations for the three months ended March 31, 2020 is attributable to the Company paying down accruals and payables. Cash provided by operations for the six months ended June 30, 2019 is attributable to the Company’s decrease in accounts payable.

We had cash used in investing activities of $0 for the three months ended March 31, 2021 and $12,759 for the sixthree months ended June 30, 2020 and $0 for the six months ended June 30, 2019.March 31, 2020.

We had cash provided byused financing activities of $179,495$33,000 for the sixthree months ended June 30, 2020,March 31, 2021, compared to cash used in $18,486$0 for the same period in 2019.2020.

We will have to raise funds to pay for our expenses. We may have to borrow money from shareholders or issue debt or equity or enter into a strategic arrangement with a third party. There can be no assurance that additional capital will be available to us. We currently have no arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. Since we have no such arrangements or plans currently in effect, our inability to raise funds for our operations will have a severe negative impact on our ability to remain a viable company.