UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURUTIES EXCHANGE ACT OF 1934
For the fiscal year ended May 31, 2009
Commission file number 333-143935
Ads in Motion, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 95-4856713
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
4139 Corral Canyon
Bonita CA 91902
(619) 200-6769 Fax: (619) 267-0452
(Address of Principal Executive Offices, Zip Code & Telephone Number)
Edward F. Myers III
ADS IN MOTION, INC.
4139 Corral Canyon
Bonita CA 91902
Phone (619) 200-6769 Fax (619) 421-2653
(Name, Address and Telephone Number of Agent for Service)
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 [X]
Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or Section 15(d) of the Act Yes [ ] No [X]
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K 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. [ ]
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 [X]
(Do not check if smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
As of August 6, 2009, the registrant had 9,530,000 shares of common stock issued
and outstanding. No market value has been computed based upon the fact that no
active trading market had been established.
ADS IN MOTION, INC.
TABLE OF CONTENTS
Page No.
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Part I
Item 1. Business 3
Item 1A. Risk Factors 7
Item 2. Properties 10
Item 3. Legal Proceedings 10
Item 4. Submission of Matters to a Vote of Securities Holders 10
Part II
Item 5. Market for Registrant's Common Equity, Related Stockholder
Matters and Issuer Purchases of Equity Securities 10
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations 11
Item 8. Financial Statements and Supplementary Data 13
Item 9A. Controls and Procedures 22
Part III
Item 10. Directors and Executive Officers 24
Item 11. Executive Compensation 25
Item 12. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters 25
Item 13. Certain Relationships and Related Transactions 26
Item 14. Principal Accounting Fees and Services 26
Part IV
Item 15. Exhibits 27
Signatures 27
2
PART I
CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING INFORMATION
Certain statements in this annual report on Form 10-K contain or may contain
forward-looking statements that are subject to known and unknown risks,
uncertainties and other factors which may cause actual results, performance or
achievements to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. These
forward-looking statements were based on various factors and were derived
utilizing numerous assumptions and other factors that could cause our actual
results to differ materially from those in the forward-looking statements. These
factors include, but are not limited to, our ability to consummate a merger or
business combination, economic, political and market conditions and
fluctuations, government and industry regulation, interest rate risk, U.S. and
global competition, and other factors. Most of these factors are difficult to
predict accurately and are generally beyond our control. You should consider the
areas of risk described in connection with any forward-looking statements that
may be made herein. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this report.
Readers should carefully review this annual report in its entirety, including
but not limited to our financial statements and the notes thereto. Except for
our ongoing obligations to disclose material information under the Federal
securities laws, we undertake no obligation to release publicly any revisions to
any forward-looking statements, to report events or to report the occurrence of
unanticipated events. For any forward-looking statements contained in any
document, we claim the protection of the safe harbor for forward-looking
statements contained in the Private Securities Litigation Reform Act of 1995.
ITEM 1. BUSINESS
GENERAL INFORMATION
Ads in Motion was incorporated in Delaware on April 4, 2001. Our address and
telephone numbers are 4139 Corral Canyon, Bonita CA 91902; Phone(619) 200-6769,
Fax (619) 421-2653. Ads in Motion is using the concept of an advertising service
for businesses within a more-than-one-story office building to display
promotional advertising on a TV monitor inside the building's elevators. A TV
screen mounted inside a passenger elevator has an immediate captive audience and
the advertising would principally be for businesses or professional offices
within that building. The Company is also developing advertising on a mobile
van. The Van displays a video screen and may be seen while traveling from place
to place. The advertising on the screen may be changed at will.
We are a development stage company with no revenues or profits. Our fiscal year
end is May 31st.
As of May 31, 2009 we had generated no revenues. We have been issued an opinion
by our auditor that raises substantial doubt about our ability to continue as a
going concern based on our current financial position.
We have a total of 80,000,000 authorized common shares with a par value of
$0.0001 per share with 9,530,000 common shares issued and outstanding as of May
31, 2009.
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BUSINESS DEVELOPMENT
Ads In Motion has no revenues and limited operations. We have sustained losses
since inception, April 4, 2001, to May 31, 2009 of $35,517 and rely solely upon
the sale of securities and loans from our corporate officers and directors for
funding.
Ads In Motion has never declared bankruptcy, been in receivership, or involved
in any kind of legal proceeding.
CORPORATE HISTORY
The Company was incorporated in 2001 as Paradise Yoga Retreat, Inc. to take
advantage of several then existing business opportunities. The Company remained
relatively dormant until May 2007. Between December 7, 2005 and May 9, 2007
Edward F. Myers II was president of Paradise Yoga Retreat, Inc., now renamed Ads
in Motion, Inc. He resigned when new management was elected on May 9, 2007.
Edward F. Myers II originated the idea of advertising in elevators and
established a corporation known as "Up & Down Video, Inc." and attempted to
employ that business plan. He contacted long time friends Gene and Anita Hill
and asked if they would help with the project. They agreed to become officers
and directors of the newly formed company. Anita Hill is an expert in word
processing and helped with the preparation of the required documents. Gene Hill
is an expert in cable video of the type to be used in the elevators.
Subsequently when Edward F. Myers III came to Edward F. Myers II with the idea
of video advertising on moving vehicles Edward F. Myers II suggested that Edward
F. Myers III start a new company for the purpose of raising capital and
operating the business. Edward F. Myers II further suggested that Edward F.
Myers III approach family friends for further assistance and technical advice.
He further suggested that if the Hill's had no objections he would utilize the
general format of Up & Down Video, Inc. for Ads in Motion. The Hill's agreed to
serve as officers and directors and technical advisors of the new project.
Edward F. Myers III then established Ads in Motion, Inc. for the implementation
of this venture. Edward F. Myers III sought out another old family friend, Mr.
S. Douglas Henderson, whom he had known for over 20 years. He further requested
assistance for the financing of the Company and the operation of some further
activities. Mr. Henderson agreed to provide Edward F. Myers III with the
requested assistance. Edward F. Myers III took on the role of company manager
and head of sales and marketing.
As of October 2007 Gene and Anita Hill have resigned as officers and directors
of Ads in Motion. Mr. Hill has been retired for several years, Mrs. Hill has
recently retired. Edward F. Myers III has since been elected as a director and
president of Ads in Motion, Inc. Beginning in June of 2007 Edward F. Myers III
began serving as general manager of the Company and has been instrumental in the
development of the Company's beta test sites.
Ads in Motion does not have sufficient cash resources to operate at the present
level of expenditure for the next 12 months. We estimate that we will need a
minimum of $5,000 to keep the Company in operation for an additional 12 months.
As of May 31, 2009 the Company had a cash balance of $1,511. We have an
outstanding loan from a related party for $26,906, this loan is at six percent
interest with principal and interest all due on May 7, 2010. Ads in Motion may
raise additional capital either through debt or equity. No assurances can be
given that such efforts will be successful. The Company has no specific plans at
present for raising additional capital.
In the next 12 months, Ads in Motion will pursue arrangements for the sale of
its services. Revenues are expected late 2009, but no assurance can be given. A
manufacturing source for the mounting brackets for elevators and the monitors
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has been found, and pricing and availability is being investigated. Flat-screen
TVs are readily available. The holding frame to be installed in the vehicle has
been built by a local fabricator and a prototype installed. Ads in Motion
purchases the video screens systems for elevators from Ceiva, Inc.
The Company has developed brochures for both its elevator and van displays. The
Company will continue to mail and distribute these brochures to prospective
clients. We have also procured our domain name at www.ads-in-motion.com, set up
a preliminary website with contact information and we will continue to add
information to the site over the next few months. The Company has identified all
the suppliers for the operation of its business. A Company has been identified
which has personell who can install the elevator displays. Depending on the
state of the US economy the Company expects sales in the fall of 2009.
NATURE OF SERVICE
The concept of elevator advertising is not completely new but has not, to the
company directors' knowledge, been developed for general use in a typical city
office building in San Diego County.
The concept of a flat screen in the rear of a traveling van with still "slide"
advertising digitally produced, has, as far as the directors' know, not been
produced or marketed.
Ads in Motion would install a TV monitor (with permission and cooperation from
building manager and elevator maintenance company), and would secure and
maintain that monitor. If there is more than one elevator in a building, more
than one installation could take place.
The company would be responsible for soliciting advertising copy and pictures,
if appropriate, from the businesses in the building, as well as national
advertisers. The number of times the ad would run, how long, and the cost are
still negotiable and flexible and under study by the Company.
Ads in Motion would then design an attractive short ad and produce it for
viewing on the monitor. Timers would be set for duration of exposure. Ads could
be changed on a daily basis, if needed. The ads can be changed by Ads in Motion
over the Internet using a secure code.
Per-minute rates and repetitions have yet to be determined. Ads would be viewed
many times in a day, repeating for a continual flow of passengers.
Ads in Motion has one commissioned salesperson who operates as an independent
contractor. This salesperson will receive 10% of the gross value of any contract
which they have signed.
Ads in Motion has permission to install a system in a small two-story office
building in Chula Vista, California. The tenants of the office building are
mostly physicians, and there is a pharmacy on the ground floor.
To market the vehicle advertising, businesses will be solicited for a certain
number of times their display is shown per day. The company will work with the
business client to produce eye-catching wording with the flexibility of daily
specials, special events or hours, entertainment figures, and a number of other
possibilities. These ads would be controlled by a laptop computer in the van and
would be mobile, especially in the evening hours when the ads would be more
noticeable.
We are preparing a market study with inquiries to appropriate types of
businesses as to their opinion of the usefulness and marketability of this
service. This market study is being done by Ads in Motion, without outside
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independent assistance. An initial prototype has been installed in the elevator
at a medical office building in Chula Vista, California. The service is not
commercially viable at this time.
COMPETITION
When the company founders conceived the idea, they observed and inquired as to a
similar service available to consumers in San Diego, California. No such service
was found. It has been observed by a company shareholder that such a service is
available in British Columbia, Canada.
While somewhat similar mobile advertising has been observed, this precise
concept and its large variety of possible changes has not been observed, nor has
the existence of any such service.
A company in San Diego, California, has announced that it will start pulling
large inflatable signs behinds boats in San Diego Bay, starting in the Summer of
2007. The Company does not see this as direct competition.
SOURCES AND AVAILABILITY OF RAW MATERIALS
A manufacturing source for the mounting brackets for elevators and the monitors
has been found, and pricing and availability is being investigated. Flat-screen
TVs are readily available. The holding frame to be installed in the vehicle has
been built by a local fabricator and a prototype installed. Ads in Motion
purchases the video screens systems for elevators from Ceiva, Inc.
DEPENDENCE ON ONE OR A FEW MAJOR CUSTOMERS
We will not depend on any one or a few major customers.
PATENTS AND TRADEMARKS
We have not applied for copyright, trademark or patent protection. We will
continue to assess the needs for such protection in the future.
GOVERNMENT CONTROLS, APPROVAL AND LICENSING REQUIREMENTS
We are not required to apply for or have any government approval for our
products or services.
RESEARCH AND DEVELOPMENT ACTIVITIES AND COSTS
We have expended no funds for research and development costs since inception.
COMPLIANCE WITH ENVIRONMENTAL LAWS
We are not aware of any environmental regulations that could directly affect our
operations, but no assurance can be given that environmental regulations will
not, in the future, have a material adverse impact on our business.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
All activities are carried out by the officers and directors. The Company has
one salesperson who operates as an independent contractor and receives 10% of
any contract for which he is responsible.
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REPORTS TO SECURITY HOLDERS
We will voluntarily make available an annual report including audited financials
on Form 10-K to security holders. We will file the necessary reports with the
SEC pursuant to the Exchange Act, including but not limited to, the report on
Form 8-K, annual reports on Form 10-K, and quarterly reports on Form 10-Q.
The public may read and copy any materials filed with the SEC at the SEC's
Public Reference Room at 100 F Street NE, Washington, DC 20549. The public may
obtain information on the operation of the Public Reference Room by calling the
SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports,
proxy and information statements, and other electronic information regarding Ads
In Motion and filed with the SEC at http://www.sec.gov.
ITEM 1A. RISK FACTORS
(1) Ads in Motion is a start-up company and subject to all the risks of a new
business, thus risks to the investor.
The company is very small and only recently has it begun exploring
development of these two types of services and their desirability for
advertisers. Since the concepts are relatively new, very little is known of
their feasibility or potential revenues. Because we are just starting the
development, the investor is at risk that this new business will not be
able to make a profit, or take a very long time to accomplish that.
(2) Lack of experience in the advertising business may result in unsatisfactory
management resulting in little or no profits.
No history in operating an advertising service may risk investor funds due
to the inexperience of the officers and directors who are making business
decisions. This lack of experience may result in an inability to run a
successful business. There is no assurance that Ads in Motion will ever
produce earnings.
(3) Additional funds may be needed and may not be able to be raised, resulting
in the company being unable to operate.
The balance sheet for the year ended May 31, 2009, shows a stockholders'
equity of negative $25,398 and working capital of only $1,511. We do not
have sufficient funds for the next 12 months of operations. Thus, we may
need to raise additional capital, and there is no assurance that we will be
able to raise sufficient capital for continuing needs.
While Ads in Motion intends to sell its services to existing office
buildings in the San Diego County area and other businesses which might
benefit from mobile ads and will have minimal related costs, there is no
assurance of sufficient advertising revenues to make a viable business.
There can be no assurance that we will be successful in achieving the
objectives.
The management of Ads in Motion intends to pursue its business plan fully,
but if the business proves unfeasible, or sufficient monies cannot be
raised, the company's management and major shareholders may pursue a new
business plan or partner with another company, if they feel it is in the
best interests of the shareholders. The minority shareholders will not have
a vote in this decision.
7
As of this date, Ads in Motion product and service line is only a concept
with an experimental location and an experimental mobile facility. No
contracts have been signed with building managers or business owners, and
there is no assurance that contracts will be forthcoming. A monitor has
been installed in an elevator in a small local medical office building and
a flat screen monitor has been installed in the rear of a van with computer
hookup capability.
(4) Little Beta testing has been done.
Prototypes have been produced in one location and on one vehicle. Other
office buildings in other cities already display such video advertising in
their elevators, though there are none to our knowledge in San Diego. In
the case of the mobile advertising by flat screen TV in the rear of a
vehicle, somewhat similar advertising has been observed, but they are
mechanical in nature and not nearly as flexible as our concept. This type
of competition however, may prove more than Ads in Motion can surmount. We
have installed a unit in one elevator in one office building. The cost of
the advertising has not yet been determined, and it may not be reasonable
for businesses or professions to use them or benefit from sufficient
exposure. Ads in Motion will rely, at least initially, on its own
soliciting of advertisers and may not have sufficient experience to
accomplish any sizeable quantity of interested advertisers. If the price of
the service cannot be at a competitive level with other sources of
advertising, then there could be too few sales and the investor may lose
the money invested.
(5) Our market study may prove incorrect about the desirability of the service.
The evaluation of the Company's services has been done solely by its
officers and directors. No independent analysis or study of its services
has been done by anyone engaged by Ads in Motion. The Company has surveyed
the office buildings in San Diego, California, and met with three companies
which manage high-rise office buildings in San Diego. The investor is at
risk if the company's studies have overestimated the service's
marketability in the U.S. and as compared to Canada.
In the case of the mobile advertising concept, no actual market study has
been made, except observation that the captive audience traveling by car
and forced to observe what is ahead of him in traffic may be an untapped
audience.
(6) Potential liabilities from use of displays. We are liable for the safety of
passengers in the elevator in relation to the TV monitor and cannot
completely guarantee passenger safety at all times, thus the risk of injury
and lawsuit. Our vehicles may cause traffic problems for which the Company
may be liable.
Although we cannot foresee any specific dangers, we are not insulated from
the possibility of a law suit arising from the existence of our product in
an elevator. There may also be a risk of theft of the monitor, though it is
the intent to secure it well. The Company presently has no liability or
theft insurance coverage. We believe that this is appropriate at present
considering the nature of the service and the stage of development. There
can be no assurance that this decision will not result in consequent loss
to us and, therefore, to the investor.
In the case of the vehicle advertising, there may be some liability if the
visual display is sufficiently distracting as to cause a motorist to not be
a safe driver. There may be also in the future legal restrictions on such
vehicular advertising.
8
(7) Ads in Motion is completely dependent on its management for the service
development, thus the talent base is very slim.
The current management is the only personnel available to develop the
service, and it is probable that we would not have sufficient capital to
hire personnel to continue the development of the service should management
for any reason cease or be unable to continue to work. Without personnel to
replace officer and director management, the company could not continue to
operate. The present management acquired its controlling interest in Ads in
Motion on May 9, 2007.
(8) The investor has no say in the management of the company, being unable to
rescue the company from failure due to poor management.
A shareholder "S" Douglas Henderson owns 83% of the company's common stock
and will be in a position to continue to control Ads in Motion. Such close
control may be risky to the investor because the entire company's operation
is dependent on a very few people who could lose their ability, or
interest, in pursuing the company's operation.
(9) No cash dividends are anticipated in the foreseeable future.
Since Ads in Motion does not anticipate that it will pay dividends, the
investor will only profit by the increase in value of his shares. Our
profits, if any, during the next several years, will necessarily be used to
develop and possibly expand the service lines and business.
(10) There is no market for the common stock, thus investment is very illiquid.
Even after the distribution of the shares, there is no assurance a market
will develop. The common stock will not initially be traded on NASDAQ or
any Securities Exchange, which may result in the risk of minimal liquidity
of the investment.
(11) Loss of control by common stock shareholders due to Preferred Shareholder
rights.
Rights of preferred shareholders could potentially create an anti-takeover
effect, which could be a disadvantage for common stock holders to profit
from a possibly lucrative buy-out arrangement. The Company is authorized to
issue 20,000,000 shares of $0.0001 par value preferred stock with the
rights, preferences, privileges, and restrictions thereof to be determined
by the Board of Directors of Ads in Motion. Preferred stock can thus be
issued without the vote of the holders of common stock. Rights could be
granted to the holders of preferred stock which could reduce the
attractiveness of Ads in Motion as a potential takeover target, make the
removal of management more difficult, or adversely impact the rights of
holders of common stock. No preferred stock is currently outstanding, and
we have no present plans for the issuance of any shares of preferred stock.
(12) Lack of a Patent could result in competition.
We have elected not to pursue a patent at this time until further
development of the company's potential is explored. There is risk that the
service will be seen and copied and we will lose the competitive edge.
(13) Management's involvement in other companies may result in insufficient time
spent to operate a successful business.
9
The Company's officers and directors are involved with other businesses.
While these businesses are not similar to Ads in Motion, they could compete
for management's time and energies. Each officer will be able to spend
approximately 4-5 hours per week on this company at this time. This amount
of time is deemed sufficient at this time and can be expanded as needed.
ITEM 2. PROPERTIES
Our principal executive office address is 4139 Corral Canyon, Bonita, CA 91902.
The principal executive office and telephone number are provided by the
president of the corporation at no cost.
We do not have any investments or interests in any real estate. We do not invest
in real estate mortgages, nor do we invest in securities of, or interests in,
persons primarily engaged in real estate activities.
ITEM 3. LEGAL PROCEEDINGS
We are not currently involved in any legal proceedings nor do we have any
knowledge of any threatened litigation.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the fiscal year
ended May 31, 2008.
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There has been no market established for our common stock.
As of May 31, 2009, we have 9,530,000 shares of $0.0001 par value common stock
issued and outstanding held by 159 shareholders of record.
The stock transfer agent for our securities is Signature Stock Transfer, 2632
Coachlight Court, Plano, TX.
DIVIDENDS
We have never declared or paid any cash dividends on our common stock. For the
foreseeable future, we intend to retain any earnings to finance the development
and expansion of our business, and we do not anticipate paying any cash
dividends on our common stock. Any future determination to pay dividends will be
at the discretion of the Board of Directors and will be dependent upon then
existing conditions, including our financial condition and results of
operations, capital requirements, contractual restrictions, business prospects,
and other factors that the board of directors considers relevant.
SECTION RULE 15(g) OF THE SECURITIES EXCHANGE ACT OF 1934
The Company's shares are covered by Section 15(g) of the Securities Exchange Act
of 1934, as amended that imposes additional sales practice requirements on
broker/dealers who sell such securities to persons other than established
customers and accredited investors (generally institutions with assets in excess
of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual
income exceeding $200,000 or $300,000 jointly with their spouses). For
10
transactions covered by the Rule, the broker/dealer must make a special
suitability determination for the purchase and have received the purchaser's
written agreement to the transaction prior to the sale. Consequently, the Rule
may affect the ability of broker/dealers to sell our securities and also may
affect your ability to sell your shares in the secondary market.
Section 15(g) also imposes additional sales practice requirements on
broker/dealers who sell penny securities. These rules require a one page summary
of certain essential items. The items include the risk of investing in penny
stocks in both public offerings and secondary marketing; terms important to in
understanding of the function of the penny stock market, such as "bid" and
"offer" quotes, a dealers "spread" and broker/dealer compensation; the
broker/dealer compensation, the broker/dealers duties to its customers,
including the disclosures required by any other penny stock disclosure rules;
the customers rights and remedies in causes of fraud in penny stock
transactions; and, FINRA's toll free telephone number and the central number of
the North American Administrators Association, for information on the
disciplinary history of broker/dealers and their associated persons.
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS
We do not have any equity compensation plans and accordingly we have no
securities authorized for issuance there under.
PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
We did not purchase any of our shares of common stock or other securities during
the year ended May 31st, 2008.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
We have generated no revenues since inception and have incurred $35,517 in
expenses through May 31, 2009.
The following table provides selected financial data about our company for the
year ended May 31, 2009.
Balance Sheet Data: 5/31/09
------------------- -------
Cash $ 1,511
Total assets $ 2,288
Total liabilities $ 27,686
Shareholders' equity $(25,398)
On December 7, 2005, Ads in Motion (them named Paradise Yoga Retreats, Inc.)
sold 500,000 shares of its common stock to Travers International, Inc. for $100.
On May 9, 2007, Ads in Motion sold 8,000,000 shares of common stock to S.
Douglas Henderson for a total of $5,000. On May 9 2007, the Company issued
30,000 shares of common stock to Eugene Hill for a business plan. The 30,000
shares were valued at $18.75. On August 31, 2007 the Company sold 1,000,000
shares of its common stock to Edward F. Myers III, the Company's sales manager,
for the total amount to $5,000. These sales were exempt from registration under
the Securities Act of 1933, as amended, in reliance on Section 4(2) for sales
not involving a public offering.
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We incurred operating expenses of $18,733 and $15,397 for the years ended May
31, 2009 and 2008, respectively. These expenses consisted of general operating
expenses incurred in connection with the day to day operation of our business.
LIQUIDITY AND CAPITAL RESOURCES
Our cash in the bank at May 31, 2009 was $1,511, total assets were $2,288 and
outstanding liabilities were $27,686. Our directors have agreed to provide
additional funding that will enable us to maintain a positive cash flow needed
to pay for our current level of operating expenses over the next twelve months,
which would include miscellaneous office expenses, bookkeeping and audit fees.
There are no formal commitments or arrangements with our directors to advance or
loan funds. We are a development stage company and have generated no revenue to
date. We estimate our current cash balance of $1,511, along with loans from our
director, will be sufficient for office expenses and fees. We anticipate that we
will need approximately $5,000 through 2009 or until we are able to receive
additional funding or generate revenues. These fees are estimated to be $3,000
for accounting and legal fees and $2,000 for administrative costs.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements.
BUSINESS OPERATIONS OVERVIEW
The following are the projected future activities of the company. The specific
timing will depend on the ability of Ads in Motion to raise capital.
In the next 12 months, Ads in Motion will pursue arrangements for the sale of
its services. Do to a shortage of capital the Company is using brochures which
have already been developed and printed. These brochures are being distributed
by placing them is places where they can be obtained by prospective customers.
Future sales and revenue will depend on the general economy and the ability of
the Company to raise additional capital.
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ITEM 8. FINANCIAL STATEMENTS
Chang G. Park, CPA, Ph. D.
* 2667 CAMINO DEL RIO S. PLAZA B * SAN DIEGO * CALIFORNIA 92108-3707 *
* TELEPHONE (858)722-5953 * FAX (858) 761-0341 * FAX (858) 764-5480
* E-MAIL changgpark@gmail.com *
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Ads In Motion, Inc.
We have audited the accompanying balance sheets of Ads In Motion, Inc. (A
Development Stage Company, the "Company") as of May 31, 2009 and 2008 and the
related statements of operations, changes in shareholders' equity and cash flows
for the years then ended and for the period from April 4, 2001 (inception)
through May 31, 2009. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Ads In Motion, Inc. as of May
31, 2009 and 2008, and the result of its operations and its cash flows for the
years then ended in conformity with U.S. generally accepted accounting
principles.
The financial statements have been prepared assuming that the Company will
continue as a going concern. As discussed in Note 3 to the financial statements,
the Company's losses from operations raise substantial doubt about its ability
to continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ Chang Park
- ------------------------------
CHANG G. PARK, CPA
July 8, 2009
San Diego, CA. 92108
Member of the California Society of Certified Public Accountants
Registered with the Public Company Accounting Oversight Board
13
ADS IN MOTION, INC.
(A Development Stage Company)
Balance Sheets
- --------------------------------------------------------------------------------
As of As of
May 31, May 31,
2009 2008
-------- --------
ASSETS
CURRENT ASSETS
Cash $ 1,511 $ 2,952
-------- --------
TOTAL CURRENT ASSETS 1,511 2,952
NET FIXED ASSETS 777 1,044
-------- --------
TOTAL ASSETS $ 2,288 $ 3,996
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accrued Expense $ 780 $ 672
-------- --------
TOTAL CURRENT LIABILITIES 780 672
LONG-TERM LIABILITIES
Loan Payable 26,906 9,000
-------- --------
TOTAL LONG-TERM LIABILITIES 26,906 9,000
TOTAL LIABILITIES 27,686 9,672
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, ($0.0001 par value, 80,000,000 shares authorized;
9,530,000 shares issued and outstanding,as of May 31, 2009 and
May 31, 2008, respectively) 953 953
Additional paid-in capital 9,166 9,166
Deficit accumulated during development stage (35,517) (15,795)
-------- --------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (25,398) (5,676)
-------- --------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY (DEFICIT) $ 2,288 $ 3,996
======== ========
See Notes to Financial Statements
14
ADS IN MOTION, INC.
(A Development Stage Company)
Statements of Operations
- --------------------------------------------------------------------------------
April 4, 2001
(inception)
Year Ended Year Ended through
May 31, May 31, May 31,
2009 2008 2009
---------- ---------- ----------
REVENUES
Revenues $ -- $ -- $ --
---------- ---------- ----------
TOTAL REVENUES -- -- --
OPERATING COSTS
Depreciation 267 270 559
Administrative expenses 18,466 15,127 33,712
---------- ---------- ----------
TOTAL OPERATING COSTS 18,733 15,397 34,271
---------- ---------- ----------
OTHER INCOME & (EXPENSES)
Other income 100 -- 100
Interest expense (1,089) (257) (1,346)
---------- ---------- ----------
TOTAL OTHER INCOME & (EXPENSES) (989) (257) (1,246)
---------- ---------- ----------
NET INCOME (LOSS) $ (19,722) $ (15,654) $ (35,517)
========== ========== ==========
BASIC EARNINGS PER SHARE $ (0.00) $ (0.00)
========== ==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 9,530,000 9,292,295
========== ==========
See Notes to Financial Statements
15
ADS IN MOTION, INC.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity (Deficit)
From April 4, 2001 (inception) through May 31, 2009
- --------------------------------------------------------------------------------
Deficit
Accumulated
Common Additional During
Common Stock Paid-in Development
Stock Amount Capital Stage Total
----- ------ ------- ----- -----
<c>
BALANCE APRIL 4, 2001 -- $ -- $ -- $ -- $ --
Net Loss, May 31, 2001 -- --
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2001 -- -- -- -- --
---------- ------ ------- --------- ---------
Net Loss, May 31, 2002 -- --
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2002 -- -- -- -- --
---------- ------ ------- --------- ---------
Net Loss, May 31, 2003 -- --
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2003 -- -- -- -- --
---------- ------ ------- --------- ---------
Net Loss, May 31, 2004 -- --
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2004 -- -- -- -- --
---------- ------ ------- --------- ---------
Net Loss, May 31, 2005 -- --
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2005 -- -- -- -- --
---------- ------ ------- --------- ---------
Stock issued for cash and
services on December 7, 2005
@ $.002 per share 500,000 50 50 100
Net Loss, May 31, 2006 (100) (100)
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2006 500,000 50 50 (100) --
---------- ------ ------- --------- ---------
Stock issued for cash on May 9,
2007 @ $.000625 per share 8,000,000 800 4,200 5,000
Stock issued for services on May 9,
2007 @ $.000625 per share 30,000 3 16 19
Net Loss, May 31, 2007 (41) (41)
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2007 8,530,000 853 4,266 (141) 4,978
---------- ------ ------- --------- ---------
Stock Issued for cash on August 27,
2007 @ $.005 per share 1,000,000 100 4,900 5,000
Net Loss, May 31, 2008 (15,654) (15,654)
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2008 9,530,000 953 9,166 (15,795) (5,676)
---------- ------ ------- --------- ---------
Net Loss, May 31, 2009 (19,722) (19,722)
---------- ------ ------- --------- ---------
BALANCE, MAY 31, 2009 9,530,000 $ 953 $ 9,166 $ (35,517) $ (25,398)
========== ====== ======= ========= =========
See Notes to Financial Statements
16
ADS IN MOTION, INC.
(A Development Stage Company)
Statements of Cash Flow
- --------------------------------------------------------------------------------
April 4, 2001
(inception)
Year Ended Year Ended through
May 31, May 31, May 31,
2009 2008 2009
-------- -------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(19,722) $(15,654) $(35,517)
Adjustments to reconcile net loss to net cash -- -- (1)
provided by (used in) operating activities:
Depreciation 267 270 559
Common stock issued for services -- -- 69
Changes in operating assets and liabilities:
Increase (decrease) in accrued expenses 108 672 780
-------- -------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (19,347) (14,712) (34,110)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of equipment -- -- (1,335)
-------- -------- --------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- (1,335)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in loan payable - long term 17,906 9,000 26,906
Issuance of common stock -- 100 925
Additional paid-in capital -- 4,900 9,125
-------- -------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 17,906 14,000 36,956
-------- -------- --------
NET INCREASE (DECREASE) IN CASH (1,441) (712) 1,511
CASH AT BEGINNING OF YEAR 2,952 3,664 --
-------- -------- --------
CASH AT END OF YEAR $ 1,511 $ 2,952 $ 1,511
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ --
======== ========
Income Taxes $ -- $ --
======== ========
See Notes to Financial Statements
17
ADS IN MOTION, INC.
(A Development Stage Company)
Notes to Financial Statements
May 31, 2009
- --------------------------------------------------------------------------------
NOTE 1: ORGANIZATION AND DESCRIPTIONS OF BUSINESS
Ads In Motion, Inc, (the Company) was incorporated under the laws of the State
of Delaware on April 4, 2001. The Company has developed the concept of an
advertising service for businesses within a more-than-one story office building
to display promotional advertising on a TV monitor inside the building's
elevator. The Company is also developing advertising on a mobile van. The
Company changed its name from Paradise Yoga Retreats Inc. to Ads In Motion, Inc.
on May 7, 2007.
The Company is in the development stage. Its activities to date have been
limited to capital formation, organization, and development of its business plan
and a target customer market.
NOTE 2: SUMMARY OF SIGNIGICANT ACCOUNTING POLICIES
A. BASIS OF ACCOUNTING
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected a May 31, year-end.
B. CASH EQUIVALENTS
The Company considers all highly liquid investments purchased with an original
maturity of three months or less to be cash equivalents.
C. PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Equipment and fixtures are being
depreciated using the straight-line method over the estimated asset lives, 5
year.
D. REVENUE RECOGNITION
The Company recognizes revenue in accordance with SEC Staff Accounting Bulletin
No. 104, "Revenue Recognition" ("SAB 104"). The Company generates revenue from
the sale of candles. SAB 104 requires that four basic criteria must be met
before revenue can be recognized; (1) persuasive evidence of an arrangement
exists; (2) delivery has occurred or services rendered; (3) the seller's price
to the buyer is fixed and determinable; and (4) collect ability is reasonably
assured. Amounts billed or received from customers in advance of performance are
recorded as deferred revenue.
E. INCOME TAXES
Income taxes are provided in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS 109), Accounting for Income Taxes. A deferred tax asset
or liability is recorded for all temporary differences between financial and tax
reporting and net operating loss carry forwards. Deferred tax expense (benefit)
results from the net change during the year of deferred tax assets and
liabilities.
Deferred tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that some portion of all the deferred tax
assets will be realized. Deferred tax assets and liabilities are adjusted for
the effects of changes in tax laws and rates on the date of enactment.
18
ADS IN MOTION, INC.
(A Development Stage Company)
Notes to Financial Statements
May 31, 2009
- --------------------------------------------------------------------------------
NOTE 2: SUMMARY OF SIGNIGICANT ACCOUNTING POLICIES - CONTINUED
F. USE OF ESTIMATES AND ASSUMPTIONS
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. In accordance with FASB 16 all
adjustments are normal and recurring.
G. PER SHARE INFORMATION
The Company computes loss per share in accordance with SFAS No. 128, "Earnings
per Share" which requires presentation of both basic and diluted earnings per
share on the face of the statement of operations. Basic loss per share is
computed by dividing net loss available to common shareholders by the weighted
average number of outstanding common shares during the period. Diluted loss per
share gives effect to all dilutive potential common shares outstanding during
the period. Dilutive loss per share excludes all potential common shares if
their effect is anti-dilutive.
H. STOCK-BASED COMPENSATION
The Company records stock-based compensation in accordance with SFAS No. 123R
"Share Based Payments", using the fair value method. All transactions in which
goods or services are the consideration received for the issuance of equity
instruments are accounted for based on the fair value of the consideration
received or the fair value of the equity instrument issued, whichever is more
reliably measurable. Equity instruments issued to employees and the cost of the
services received as consideration are measured and recognized based on the fair
value of the equity instruments issued.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
Recently issued accounting pronouncements will have no significant impact on the
Company and its reporting methods.
NOTE 3: GOING CONCERN
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company generated net losses of
$35,517 during the period from April 4, 2001 (inception) through May 31, 2009.
This condition raises substantial doubt about the Company's ability to continue
as a going concern. The Company's continuation as a going concern is dependent
on its ability to meet its obligations, to obtain additional financing as may be
required and ultimately to attain profitability. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
NOTE 4: WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common stock.
19
ADS IN MOTION, INC.
(A Development Stage Company)
Notes to Financial Statements
May 31, 2009
- --------------------------------------------------------------------------------
NOTE 5: PROPERTY AND EQUIPEMENT
Property and equipment consists of the following:
As of
---------------------------
May 31, May 31,
2009 2008
-------- --------
Equipment $ 1,336 $ 1,336
-------- --------
Total Fixed Assets 1,336 1,336
Less: Accumulated Depreciation (559) (292)
-------- --------
Net Fixed Assets $ 777 $ 1,044
======== ========
Depreciation expenses for the years ended May 31, 2009 and 2008 were $267 and
$270
NOTE 6: RELATED PARTY TRANSACTION
The Company neither owns nor leases any real or personal property. The officers
and directors of the Company are involved in other business activities and may,
in the future, become involved in other business opportunities as they become
available, such persons may face a conflict in selecting between the Company and
their other business interests. The Company has not formulated a policy for the
resolution of such conflicts.
NOTE 7: LOAN PAYABLE
May 31, May 31,
2009 2008
-------- --------
Long-term $ 26,906 $ 9,000
-------- --------
Total $ 26,906 $ 9,000
======== ========
On June 5, 2007, the Company received $4,000 loan from Travers International,
Inc. This loan is at 6% interest with principle and interest all due on June 4,
2009 (Note 1).
On May 7, 2008, the Company received $5,000 loan from Travers International,
Inc. This loans is at 6% interest with principle and interest all due on May 7,
2010 (Note 2).
On July 22, 2008, the Company received $4,000 loan from Travers International,
Inc. This loans is at 6% interest with principle and interest all due on July
22, 2010 (Note 3).
On August 25, 2008, the Company received $4,000 loan from Travers International,
Inc. This loans is at 6% interest with principle and interest all due on August
22, 2010(Note 4)
On November 25, 2008, the Company executed an unsecured promissory note for
$21,871 due December 31, 2011 plus accrued interest at 6% per annual with
Travers International, Inc. (the "Travers New Note") In exchange for the unpaid
Travers Note 1 to Note 4 and interest plus an additional loan $3,000.
On May 30, 2009, the Company received $5,035 loan from Travers International,
Inc. This loans is at 6% interest with principle and interest all due on May 30,
2012 (Note 5)
20
ADS IN MOTION, INC.
(A Development Stage Company)
Notes to Financial Statements
May 31, 2009
- --------------------------------------------------------------------------------
NOTE 7: LOAN PAYABLE-(CONTINUED)
Interest expense for the years ended May 31, 2009 and 2008 was $1,089.and $257.
Accrued interest expense in total on the loan was $675 and $257 as of May 31,
2009 and 2008.
NOTE 8: NET OPERATING LOSSES
As of May 31, 2009, the Company had a net operating loss carryforward of
approximately $35,517. Net operating loss carryforward, expires twenty years
from the date the loss was incurred.
NOTE 9: STOCK TRANSACTIONS
Transactions, other than employees' stock issuance, are in accordance with
paragraph 8 of SFAS 123. Thus issuances shall be accounted for based on the fair
value of the consideration received. Transactions with employees' stock issuance
are in accordance with paragraphs (16-44) of SFAS 123. These issuances shall be
accounted for based on the fair value of the consideration received or the fair
value of the equity instruments issued, or whichever is more readily
determinable.
On December 7, 2005, the Company issued 500,000 shares of common stock for cash
of $50 and consulting services of $50.
On May 9, 2007, the Company issued 8,000,000 shares of common stock for cash of
$5,000.
On May 9, 2007, the Company issued 30,000 shares of common stock for services.
On August 27, 2007, the Company issued 1,000,000 shares of common stock for cash
of $5,000.
As of May 31, 2009, the Company had 9,530,000 shares of common stock issued and
outstanding.
NOTE 10: STOCKHOLDERS' EQUITY
The stockholders' equity section of the Company contains the following classes
of capital stock:
Common stock, $0.0001 par value: 80,000,000 shares authorized; 9,530,000 issued
and outstanding as of May 31, 2009.
Preferred stock, $0.0001 par value: 20,000,000 shares authorized; no shares
issued and outstanding as of May 31, 2009.
NOTE 11: SUBSEQUENT EVENTS
On June 3, 2009, the Company received $1,745 loan from Travers International,
Inc. This loans is at 6% interest with principle and interest all due on June 3,
2011 (Note 6)
21
ITEM 9A. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
Under the supervision and with the participation of our management, including
our principal executive officer and the principal financial officer (our
president), we have conducted an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures, as defined in Rules
13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as of the
end of the period covered by this report. Based on this evaluation, our
principal executive officer and principal financial officer concluded as of the
evaluation date that our disclosure controls and procedures were effective such
that the material information required to be included in our Securities and
Exchange Commission reports is accumulated and communicated to our management,
including our principal executive and financial officer, recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms relating to our company, particularly during
the period when this report was being prepared.
MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act, for the company.
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 our 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 our receipts and expenditures are being made
only in accordance with authorizations of its management and directors; and (3)
provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of our assets that could have a
material effect on the financial statements.
Management recognizes that there are inherent limitations in the effectiveness
of any system of internal control, and accordingly, even effective internal
control can provide only reasonable assurance with respect to financial
statement preparation and may not prevent or detect material misstatements. In
addition, effective internal control at a point in time may become ineffective
in future periods because of changes in conditions or due to deterioration in
the degree of compliance with our established policies and procedures.
A material weakness is a significant deficiency, or combination of significant
deficiencies, that results in there being a more than remote likelihood that a
material misstatement of the annual or interim financial statements will not be
prevented or detected.
Under the supervision and with the participation of our president, management
conducted an evaluation of the effectiveness of our internal control over
financial reporting, as of May 31, 2009, based on the framework set forth in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on our evaluation under
this framework, management concluded that our internal control over financial
reporting was not effective as of the evaluation date due to the factors stated
below.
22
Management assessed the effectiveness of the Company's internal control over
financial reporting as of evaluation date and identified the following material
weaknesses:
INSUFFICIENT RESOURCES: We have an inadequate number of personnel with requisite
expertise in the key functional areas of finance and accounting.
INADEQUATE SEGREGATION OF DUTIES: We have an inadequate number of personnel to
properly implement control procedures.
LACK OF AUDIT COMMITTEE & OUTSIDE DIRECTORS ON THE COMPANY'S BOARD OF DIRECTORS:
We do not have a functioning audit committee or outside directors on our board
of directors, resulting in ineffective oversight in the establishment and
monitoring of required internal controls and procedures.
Management is committed to improving its internal controls and will (1) continue
to use third party specialists to address shortfalls in staffing and to assist
the Company with accounting and finance responsibilities, (2) increase the
frequency of independent reconciliations of significant accounts which will
mitigate the lack of segregation of duties until there are sufficient personnel
and (3) may consider appointing outside directors and audit committee members in
the future.
Management, including our president, has discussed the material weakness noted
above with our independent registered public accounting firm. Due to the nature
of this material weakness, there is a more than remote likelihood that
misstatements which could be material to the annual or interim financial
statements could occur that would not be prevented or detected.
This annual report does not include an attestation report of our registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the our registered public
accounting firm pursuant to temporary rules of the SEC that permit us to provide
only management's report in this annual report.
CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING
There have been no changes in our internal control over financial reporting that
occurred during the last fiscal quarter for our fiscal year ended May 31, 2009
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.
23
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS
The Executive Officers and Directors of the Company and their ages are as
follows:
Name Age Position Date Elected
---- --- -------- ------------
Edward F. Myers III 41 President August 15, 2007
CFO, Director
"S" Douglas Henderson 67 Director August 15, 2007
Secretary May 9, 2007
EDWARD F. MYERS III has been president and a director of Ads in Motion, Inc.
since August 15, 2007. Mr. Myers has owned and operated "Myers Painting" a sole
proprietorship for the last five years. Mr. Myers is a licensed painting
contractor in the state of California. Since June of 2007 Mr. Myers has been the
general manager of Ads in Motion, Inc. and has been involved in the setting up
of the Company's beta test sights.
"S" DOUGLAS HENDERSON has been a director of Ads in Motion since August 2007 and
secretary since May 2007. Since 1998 until the present, he is Admissions
Director, Senior Flight Instructor of San Diego Flight Training International,
San Diego, CA. Since July 2004, he has worked part time as an income tax
preparer for H & R Block. Mr. Henderson is also part owner of J. Bright
Henderson, Inc., a dealer in fine art.
The Directors are elected to serve until the next annual meeting of shareholders
and until their successors have been elected. Executive officers serve at the
discretion of the Board of Directors.
Each of the foregoing persons may be deemed a "promoter" and "parent" of the
Company as that term is defined in the rules and regulations promulgated under
the Securities and Exchange Act of 1933.
No executive officer or director of the corporation has been the subject of any
order, judgment, or decree of any court of competent jurisdiction, or any
regulatory agency permanently or temporarily enjoining, barring, suspending or
otherwise limiting him from acting as an investment advisor, underwriter, broker
or dealer in the securities industry, or as an affiliated person, director or
employee of an investment company, bank, savings and loan association, or
insurance company or from engaging in or continuing any conduct or practice in
connection with any such activity or in connection with the purchase or sale of
any securities.
No executive officer or director of the corporation has been convicted in any
criminal proceeding (excluding traffic violations) or is the subject of a
criminal proceeding which is currently pending.
No executive officer or director of the corporation is the subject of any
pending legal proceedings.
CODE OF ETHICS
We do not currently have a code of ethics, because we have only limited business
operations and only two officers and directors, we believe a code of ethics
would have limited utility. We intend to adopt such a code of ethics as our
business operations expand and we have more directors, officers and employees.
24
ITEM 11. EXECUTIVE COMPENSATION
Change in
Pension
Value and
Non-Equity Nonqualified
Incentive Deferred All
Name and Plan Compen- Other
Principal Stock Option Compen- sation Compen-
Position Year Salary Bonus Awards Awards sation Earnings sation Totals
- ------------ ---- ------ ----- ------ ------ ------ -------- ------ ------
E Myers III 2009 0 0 0 0 0 0 0 0
CEO, President, 2008 0 0 0 0 0 0 0 0
Director 2007 0 0 0 0 0 0 0 0
S. Henderson 2009 0 0 0 0 0 0 0 0
CFO, Director 2008 0 0 0 0 0 0 0 0
2007 0 0 0 0 0 0 0 0
At present, Ads in Motion is operated by its Executive Officers and Directors at
no compensation and no compensation has been paid to date. No Executive Officer
or Director is expected to earn in excess of $50,000 in the foreseeable future.
Ads in Motion has no pension or profit-sharing plan. Ads in Motion may change or
increase salaries as Ads in Motion's profits and cash flow allow; however, there
are no present plans to do so.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of May 31, 2009, the name, address, and
number of shares owned directly or beneficially by persons who own 5% or more of
the company's common stock and by each executive officer and director and owner
after the Distribution.
Shares/Percent as
Beneficial Owner of May 31, 2009
---------------- ---------------
"S" Douglas Henderson 8,000,000 - 83%
4221 South Allison St.
Lakewood CO 80235
Travers International, Inc. 500,000 - 5%
4190 Bonita Road
Bonita Ca, 91902
Edward F. Myers III 1,000,000 - 10%
4139 Corral Canyon
Bonita, CA 91902
All Executive Officers 9,000,000 - 98%
and Directors as a Group (2 persons)
25
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The principal executive office and telephone number are provided by Mr. Edward
F. Myers III, the president of the corporation. The costs associated with the
use of the telephone and mailing address were deemed to be immaterial as the
telephone and mailing address were almost exclusively used by him for other
business purposes.
On December 7, 2005, Ads in Motion (them named Paradise Yoga Retreats, Inc.)
sold 500,000 shares of its common stock to Travers International, Inc. for $100.
On May 9, 2007, Ads in Motion sold 8,000,000 shares of common stock to S.
Douglas Henderson for a total of $5,000.
On May 9 2007, the Company issued 30,000 shares of common stock to Eugene Hill
for a business plan. The 30,000 shares were valued at $18.75.
On August 31, 2007 the Company sold 1,000,000 shares of its common stock to
Edward F. Myers III, the Company's sales manager, for the total amount to
$5,000.
The above sales were exempt from registration under the Securities Act of 1933,
as amended, in reliance on Section 4(2) for sales not involving a public
offering.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
The total fees charged to the company for audit services, including quarterly
reviews, were $9,500 for audit-related services were $Nil, for tax services were
$Nil and for other services were $Nil during the year ended May 31, 2009.
The total fees charged to the company for audit services, including quarterly
reviews, were $9,500 for audit-related services were $Nil, for tax services were
$Nil and for other services were $Nil during the year ended May 31, 2008.
26
PART IV
ITEM 15. EXHIBITS
The following exhibits are included with this filing:
Exhibit
Number Description
------ -----------
3(i) Articles of Incorporation*
3(ii) Bylaws*
31.1 Sec. 302 Certification of CEO
31.2 Sec. 302 Certification of CFO
32.1 Sec. 906 Certification of CEO
32.2 Sec. 906 Certification of CFO
- ----------
* Included in our SB-2 filing under Commission File Number 333-143935.
SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
August 6, 2009
Ads in Motion, Inc., Registrant
By: Edward F. Myers III
/s/ Edward F. Myers III
- --------------------------------
EDWARD F. MYERS III
President and Director
Chief Executive Officer
Principal Financial Officer
Principal Accounting Officer
By: "S" DOUGLAS HENDERSON
/s/ "S" Douglas Henderson
- --------------------------------
"S" DOUGLAS HENDERSON
Director and Secretary
27