UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2020

 

or

 

[  ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______ to ______.

 

Commission File Number: 333-208931

 

PostAds, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada		35-2539888
State or other Jurisdiction of Incorporation or Organization		(I.R.S. Employer Identification No.)
2332 NW 87th Drive, Coral Springs, Florida		33065
(Address of principal executive offices)		(Zip code)

 

Registrant’s telephone number: (954) 464-1642

 

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [  ] Yes [X] No

 

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 [X] No

 

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. [X] Yes [  ] No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X] Yes [  ] No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

	Large accelerated filer	[  ]	Accelerated filer	[  ]
	Non-accelerated filer	[  ]	Smaller reporting company	[X]
			Emerging growth company	[X]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [  ] No [X]

 

As of May 14, 2020, there were 40,036,400 outstanding shares of the Registrant’s Common Stock at $.001 par value and 2,000,000 outstanding shares of the Registrant’s Series A Preferred Stock at $.001 par value.

 

DOCUMENTS INCORPORATED BY REFERENCE None.

 

  

 

PostAds, Inc.

Form 10-Q

For the quarterly period ended March 31, 2020

 

TABLE OF CONTENTS

 

	Page
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements	3
Balance Sheets at March 31, 2020 (unaudited) and December 31, 2019	3
Statements of Operations for the Three Months Ended March 31, 2020 and 2019 (unaudited)	4
Statement of Changes in Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2020 and 2019 (unaudited)	5
Statements of Cash Flows for the Three Months Ended March 31, 2020 and 2019 (unaudited)	6
Notes to Financial Statements – March 31, 2020 (unaudited)	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3. Quantitative and Qualitative Disclosures about Market Risk	21
Item 4. Controls and Procedures	21
PART II – OTHER INFORMATION
Item 1. Legal Proceedings.	22
Item 1.A. Risk Factors	22
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3. Defaults Upon Senior Securities	22
Item 4. Mine Safety Disclosures	22
Item 5. Other Information.	22
Item 6. Exhibits	22
SIGNATURES	23

 

 

PART I – FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS.

 

PostAds, Inc.

Balance Sheets

 

		March 31, 2020				December 31, 2019
		(unaudited)
ASSETS
Current Assets
Cash		$	537			$	7
Total Current Assets			537				7
Computer equipment, net			-				-
Total Assets		$	537			$	7
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current Liabilities
Bank overdraft		$	-			$	9
Accrued liabilities			20,573				16,915
Advances payable - officer			134,305				119,845
Loan payable - related party			20,000				20,000
Accrued officers’ salaries payable			397,375				369,125
Total Current Liabilities			572,253				525,894
Total Liabilities			572,253				525,894
Commitments and contingencies (Note 10)
Stockholders’ Equity (Deficit)
Series A Preferred stock: 10,000,000 shares authorized; $0.001 par value, 2,000,000 shares issued and outstanding at March 31, 2020 and December 31, 2019			2,000				2,000
Common stock: 90,000,000 shares authorized; $0.001 par value, 40,036,400 shares issued and outstanding at March 31, 2020 and December 31, 2019			40,036				40,036
Additional paid in capital			1,938,684				1,938,684
Accumulated deficit			(2,552,436	)			(2,506,607	)
Total Stockholders’ Equity (Deficit)			(571,716	)			(525,887	)
Total Liabilities and Stockholders´ Equity (Deficit)		$	537			$	7

 

The accompanying unaudited notes are an integral part of these unaudited financial statements

 

 

PostAds, Inc.

Statements of Operations

(unaudited)

 

		For the Three Months Ended
		March 31,
		2020				2019
Revenues		$	27			$	2
Operating Expenses
Officer Compensation			28,250				31,750
General and Administrative			17,106				2,042
Total Operating Expenses			45,356				33,792
Operating Loss			(45,329	)			(33,790	)
Other Expense
Interest Expense			(500	)			(500	)
Total Other Expense			(500	)			(500	)
Net Loss		$	(45,829	)		$	(34,290	)
Basic and Diluted Loss per Share attributable to common stockholders:		$	(0.00	)		$	(0.00	)
Basic and Diluted Weighted Average Number of Shares Outstanding attributable to common stockholders:			40,036,400				40,036,400

 

The accompanying unaudited notes are an integral part of these unaudited financial statements

 

 

PostAds, Inc.

Statements of Changes in Stockholders’ Equity (Deficit)

For The Three Months Ended March 31, 2020 and 2019

(unaudited)

 

																										Total
		Series A Preferred																Additional								Stockholders’
		Stock								Common Stock								Paid-in				Accumulated				Equity
		Shares				Amount				Shares				Amount				Capital				Deficit				(Deficit)
Balance December 31, 2019			2,000,000			$	2,000				40,036,400			$	40,036			$	1,938,684			$	(2,506,607	)		$	(525,887	)
Net loss for the three months ended March 31, 2020			-				-				-				-				-				(45,829	)			(45,829	)
Balance March 31, 2020			2,000,000			$	2,000				40,036,400			$	40,036			$	1,938,684			$	(2,552,436	)		$	(571,716	)
Balance December 31, 2018			2,000,000			$	2,000				40,036,400			$	40,036			$	1,938,684			$	(2,354,444	)		$	(373,724	)
Net loss for the three months ended March 31, 2019			-				-				-				-				-				(34,290	)			(34,290	)
Balance March 31, 2019			2,000,000			$	2,000				40,036,400			$	40,036			$	1,938,684			$	(2,388,734	)		$	(408,014	)

 

The accompanying unaudited notes are an integral part of these unaudited financial statements

 

 

PostAds, Inc.

Statements of Cash Flows

(unaudited)

 

		For the Three Months Ended March 31,
		2020				2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(45,829	)		$	(34,290	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation			-				56
Amortization of stock based prepaid compensation			-				3,500
Changes in assets and liabilities:
Accrued liabilities			3,658				(7,194	)
Accrued officer salaries			28,250				28,250
Net Cash Used In Operating Activities			(13,921	)			(9,678	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Bank overdraft			(9	)			(4	)
Advances payable - officer, net			14,460				9,690
Net Cash Provided By Financing Activities			14,451				9,686
NET INCREASE IN CASH			530				8
CASH AT BEGINNING OF PERIOD			7				3
CASH AT END OF PERIOD		$	537			$	11
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Interest paid		$	-			$	-
Taxes paid		$	-			$	-

 

The accompanying unaudited notes are an integral part of these unaudited financial statements

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 1 - ORGANIZATION, BUSINESS AND OPERATIONS

 

PostAds, Inc. (the “Company”) was formed on August 17, 2015 in the State of Nevada as a reorganization of a sole proprietor business with an inception date of August 26, 2013. The business was formed to provide an online platform at www.PostAds.com that offers an alternative marketplace for buyers and sellers of both new and pre-owned goods and service items (including jobs) together in an online market place that offers both retailers and service providers a forum to advertise and promote their goods and services while providing consumers a cost-effective way of locating and purchasing goods and services.

 

We are in the development stage since we have not commenced planned principal operations. Our activities since inception include devoting substantially all of our efforts to business planning and development. Additionally, we have allocated a substantial portion of our time and investment to the completion of our development activities to launch our marketing plan and generate revenues and to raising capital. We have generated minimal revenue from operations. The Company’s activities during the development stage are subject to significant risks and uncertainties.

 

NOTE 2 - BASIS OF PRESENTATION

 

Unaudited Interim Financial Information

 

The accompanying balance sheet as of March 31, 2020, the related statements of operations, cash flows and the statement of changes in stockholders’ equity (deficit) for the three months ended March 31, 2020 and 2019 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual financial statements and with the instructions to Regulation S-X for interim financial information, which, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments necessary to state fairly the Company’s financial position as of March 31, 2020 and results of operations and cash flows for the three months ended March 31, 2020 and 2019. The financial data and the other information disclosed in these notes to the financial statements related to this three-month period is unaudited. The unaudited financial statements should be read in conjunction with the audited financial statements for the year ended December 31, 2019. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results to be expected for the full year.

 

Reclassifications – for the three months ended March 31, 2019, $500 of interest expenses was reclassified from General and Administrative expenses to Other Income (Expense) to conform to the 2020 presentation in the statements of operations. This amount is immaterial to the Total Operating Expenses in the financial statements.

 

NOTE 3 - GOING CONCERN

 

In March 2020, the outbreak of COVID-19 (coronavirus) caused by a novel strain of the coronavirus was recognized as a pandemic by the World Health Organization, and the outbreak has become increasingly widespread in the United States, including in each of the areas in which the Company operates. The COVID-19 (coronavirus) outbreak has had a notable impact on general economic conditions, including but not limited to the temporary closures of many businesses, “shelter in place” and other governmental regulations, reduced business and consumer spending due to both job losses, reduced investing activity and M&A transactions, among many other effects attributable to the COVID-19 (coronavirus), and there continue to be many unknowns. While to date the Company has not been required to stop operating, management is evaluating the use of virtual meetings and the like. The Company continues to monitor the impact of the COVID-19 (coronavirus) outbreak closely. The extent to which the COVID-19 (coronavirus) outbreak will impact our operations, ability to obtain financing or future financial results is uncertain.

 

The accompanying unaudited financial statements have been prepared on a going concern basis, which assumes the Company will realize its assets and discharge its liabilities in the normal course of business. As reflected in the accompanying unaudited financial statements, the Company had an accumulated deficit, stockholders’ deficit and working capital deficit of $2,552,436, $571,716 and $571,716, respectively, at March 31, 2020 and for the three months ended March 31, 2020 the Company had a net loss and net cash used in operating activities of $45,829 and $13,921, respectively. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of twelve months from the issuance date of this report.

 

The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The accompanying unaudited financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

 

The Company plans to attempt to raise additional equity financing and procure loans to fund its operations though there is no assurance it will succeed. The Company has not generated meaningful revenues from its business operations and is dependent on its ability to raise capital. If it is unable to raise all the capital it is seeking it may have to reduce its planned expenditures to a level where it can continue to operate until it obtains necessary financing. If it cannot obtain such financing and does not generate sufficient revenue to fund its operations, it may have to curtail or cease operations.

 

If the Company is unable to raise all the capital it is seeking, they may have to reduce their planned expenditures to a level where they can continue to operate until they obtain the necessary financing.

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Management’s Use of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates in the accompanying financial statements include valuation of stock compensation and valuation of deferred tax assets.

 

Cash and Cash Equivalents - For purposes of the Statement of Cash Flows, the Company considers liquid investments with an original maturity of three months or less to be cash equivalents. As of March 31, 2020, there were no cash equivalents.

 

Earnings (Loss) Per Share -. Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares of common stock and potentially dilutive common stock equivalents during each period. Potentially dilutive securities are excluded from the computation if their effect is anti-dilutive. As of March 31, 2020, there were no potentially dilutive common stock equivalents.

 

Computer Equipment - Computer equipment is recorded at cost. Depreciation is recognized using the straight-line method in amounts sufficient to relate the cost of depreciable assets to operations over their estimated useful lives. Repairs and maintenance are charged to operations as incurred.

 

Impairment of Long-Lived Assets - The Company evaluates the recoverability of its fixed assets and other assets in accordance with section 360-10-15 of the FASB Accounting Standards Codification relating to Impairment or Disposal of Long-Lived Assets. This standard requires recognition of impairment of long-lived assets in the event the net book value of such assets exceeds its expected cash flows. If so, it is considered to be impaired and is written down to fair value, which is determined based on either discounted future cash flows or appraised values.

 

Revenue Recognition - The Company operates a platform for third-party sellers that purchase advertising on a monthly basis. Our business model allows us to make money when a seller either places an ad in a paid category, upgrades their ad with premium features and/or purchases an advertising spot on our platform to place a banner ad. We do not compete with PostAds sellers, hold inventory or sell goods. Our revenue is diversified, generated from a mix of upgraded services we provide our sellers. Our existing revenue stream consists of Seller Services revenue, which includes fees that PostAds sellers pay us for utilizing upgraded seller services such as featured listings, additional regions, better placement, highlighting, additional photos, video uploads and paid categories.

 

Revenue is recognized in accordance with ASC 606 by applying the following five steps: 1) identify the contracts with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations; and 5) recognize revenue when (or as) we satisfy a performance obligation. The revenue is recognized pro-rata over the time period the advertisement is displayed. The Company evaluates whether it is appropriate to recognize revenue on a gross or net basis based upon its evaluation of whether it is the primary obligor in a transaction and has latitude in establishing pricing and selecting suppliers. Based on its evaluation of these factors, advertising revenue which is the advertising fee paid by the seller is recorded on a gross basis, since the Company is the party responsible to the seller for providing the service that is the subject of the transaction and while most fees are currently a fixed dollar amount, the Company has the ability and reasonable latitude to establish prices for the services.

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 4 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

There have been no chargebacks to date. If we encounter chargebacks in the future, they will be recorded as a reduction to revenue in the same period that the revenue is recognized and we may consider establishing a reserve liability.

 

Stock-Based Compensation - For employee stock-based awards, the Company calculates the fair value of the award on the date of grant using the Black-Scholes option-pricing model or based on the value of the services provided, whichever is more reliable. The expense is recognized over the service period for awards expected to vest.

 

In June 2018, the FASB issued Accounting Standards Update 2018-07, Compensation - Stock Compensation, which aligns the accounting for share based payments to non-employees with the accounting for share based payments to employees. The adoption of this update on January 1, 2019 did not cause a material change to our financial statements.

 

Fair Value for Financial Assets and Financial Liabilities - We measure our financial assets and liabilities in accordance with United States generally accepted accounting principles. For certain of our financial instruments, including cash and cash equivalents, accounts payable and accrued and other liabilities, the carrying amounts approximate fair value due to their short maturities.

 

The Company follows 825-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments and paragraph 820-10-35-37 of the FASB Accounting Standards Codification (“Paragraph 820-10-35-37”) to measure the fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below:

 

Level 1:	Quoted market prices available in active markets for identical assets or liabilities as of the reporting date.
Level 2:	Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date.
Level 3:	Pricing inputs that are generally observable inputs and not corroborated by market data.

 

The Company does not have any assets or liabilities measured at fair value on a recurring or a non-recurring basis, consequently, the Company did not have any fair value adjustments for assets and liabilities measured at fair value at December 31, 2019, nor gains or losses that were reported in the statement of operations that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at March 31, 2020 and December 31, 2019.

 

Recently Issued Accounting Standards

 

From time to time, the FASB or other standards setting bodies will issue new accounting pronouncements. Updates to the FASB ASC are communicated through issuance of an Accounting Standards Update (“ASU”).

 

In August 2018, the FASB issued ASU 2018-13, “Changes to Disclosure Requirements for Fair Value Measurements”, which will improve the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. The standard removes, modifies, and adds certain disclosure requirements, and was effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The Company implemented ASU 2018-13 on January 1, 2020 and it did not have a material effect on the Company’s financial statements.

 

Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying unaudited financial statements.

 

NOTE 5 – COMPUTER EQUIPMENT

 

Computer equipment consisted of the following at:

 

		Estimated useful lives		March 31, 2020				December 31, 2019
Computer equipment		3 years		$	1,923			$	1,923
Less: Accumulated depreciation					(1,923	)			(1,923	)
Net				$	-			$	-

 

Depreciation expense on computer equipment was $0 and $56 for the three months ended March 31, 2020 and 2019, respectfully.

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 6 – LIABILITIES

 

Accrued liabilities - consisted of the following at:

 

		March 31, 2020				December 31, 2019
Accrued website consulting fees		$	5,000			$	5,000
Accrued professional accounting fees			4,383				3,036
Accrued professional legal fees			1,500				-
Accrued administrative fees			2,454				2,454
Accrued interest			6,750				6,250
Accrued filing fees			486				175
Total accrued liabilities		$	20,573			$	16,915

 

Accrued officers’ salaries payable - consisted of the following at:

 

		March 31, 2020				December 31, 2019
Accrued officers’ salaries		$	397,375			$	369,125

 

As of March 31, 2020, the Company had not yet paid $229,375 of our Chief Executive Officer’s salary and $168,000 or our Chief Financial Officer’s salary. (See Note 10)

 

NOTE 7 – ADVANCES

 

Advances payable – officer - consisted of the following at:

 

		March 31, 2020				December 31, 2019
Advances payable - officer		$	134,305			$	119,845

 

Advances payable – officer represents non-interest-bearing advances to the Company by the Company’s Chief Executive Officer, utilized to pay general and administrative expenses.

 

NOTE 8 – LOAN PAYABLE

 

Loan payable – related party - consisted of the following at:

 

		March 31, 2020				December 31, 2019
Loan payable - related party		$	20,000			$	20,000

 

On November 16, 2016, we borrowed the sum of $20,000 from our stockholder Florence Weiss who is the mother of Steve Weiss, a principal shareholder and a related party of the Company. The note bears interest at the rate of 10% per annum, was originally due on or before November 16, 2018, was extended for two additional years and is now due on November 16, 2020. Accrued interest of $6,750 and $6,250 for this loan has been recorded as part of accrued liabilities (see Note 6) at March 31, 2020 and December 31, 2019, respectively.

 

NOTE 9 – STOCKHOLDERS’ EQUITY (DEFICIT)

 

Common Stock and Series A Preferred Stock

 

The Company’s Articles of Incorporation authorize the issuance of 90,000,000 common shares at $0.001 par value per share. The company’s Articles of Incorporation authorize the issuance of 10,000,000 shares of Series A Preferred Stock at $0.001 par value per share. The Board of Directors has the power to designate the rights and preferences of the Series A Preferred stock and issue in one or more series. Each share of Series A Preferred Stock has 50 votes on all matters submitted to a vote of the Company’s shareholders and there are no other rights designated.

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 9 - STOCKHOLDERS EQUITY (DEFICIT) (continued)

 

On November 15, 2018, the Company resolved to issue 5,000,000 shares of common stock to Kenneth T. Moore, our President, Chief Executive Officer and Sole Director, as additional consideration for services in the amount of $10,000 to be rendered to us during the period from October 1, 2018 to September 30, 2019. The 5,000,000 shares, valued at $0.002 per share resulting in a total value of $10,000 for financial accounting purposes with the total amount to be expensed over the term of the services provided through September 30, 2019. $2,500 of the total stock value of $10,000 was expensed in 2018 with the remaining $7,500 value expensed during 2019. The 5,000,000 shares had not been issued as of December 31, 2018 and had been recorded as Common stock to be issued on the Company’s balance sheet as of December 31, 2018. The 5,000,000 shares were issued during the three month period ended March 31, 2019.

 

On November 15, 2018, the Company resolved to renew the agreement with Colm J. King to act as the Company’s Chief Financial Officer for an additional year commencing on October 1, 2018. Pursuant to the terms of the one (1) year renewal, the Company will issue 2,000,000 shares of common stock valued at $0.002 per share resulting in a total value of $4,000 for financial accounting purposes with the total amount to be expensed over the term of the renewal period through September 30, 2019. $1,000 of the total stock value of $4,000 was expensed in 2018 with the remaining $3,000 value expensed during 2019. The 2,000,000 shares had not been issued as of December 31, 2018 and had been recorded as Common stock to be issued on the Company’s balance sheet as of December 31, 2018. The 2,000,000 shares were issued during the three month period ended March 31, 2019.

 

NOTE 10 – COMMITMENTS AND CONTINGENCIES

 

Lease Agreement

 

On July 15, 2018, the Company terminated its office lease agreement in order to locate more suitable office space and is temporarily conducting business from the home office of the Company’s Chief Executive Officer.

 

Employment Agreements

 

On December 28, 2015, the Company entered into an agreement with Kenneth T. Moore to act as the Company’s Chief Executive Officer for a term of two (2) years at an annual salary of $65,000. On October 1, 2017, the Company renewed its agreement with Kenneth T. Moore to act as the Company’s Chief Executive Officer for an additional two (2) year term commencing December 28, 2017 at the same annual salary of $65,000 and on December 16, 2019, Mr. Moore’s agreement was renewed through December 31, 2020 at the same annual salary. As of March 31, 2020 and December 31, 2019, the Company had not yet paid $229,375 and $213,125, respectively, of Mr. Moore’s salary and these amounts are included in accrued officers’ salaries payable at March 31, 2020 and December 31, 2019 (see Note 6).

 

On November 15, 2018, the Company agreed to issue 5,000,000 shares of common stock to Kenneth T. Moore, our President, Chief Executive Officer and Sole Director, as additional consideration for services in the amount of $10,000 to be rendered to us during the period from October 1, 2018 to September 30, 2019. The 5,000,000 shares, valued at $0.002 per share resulting in a total value of $10,000 for financial accounting purposes with the total amount to be expensed over the term of the services provided through September 30, 2019. $2,500 of the total stock value of $10,000 was expensed in 2018 with the remaining $7,500 value expensed during 2019.

 

On October 1, 2016, the Company entered into an agreement with Colm J. King to act as the Company’s Chief Financial Officer. Pursuant to the terms of the one (1) year agreement, the Company will pay aggregate consideration of $48,000 in cash and issued 1,000,000 shares of common stock on October 1, 2016, valued at the contemporaneous private placement offering price of $0.10 per share resulting in a total value of $100,000 for financial accounting purposes with the total amount to be expensed over the terms of the agreement through September 30, 2017. On October 1, 2017, the Company renewed its agreement with Colm J. King to act as the Company’s Chief Financial Officer for an additional one (1) year term commencing October 1, 2017 at the same annual salary of $48,000. On November 15, 2018, the Company resolved to renew the agreement with Colm J. King to act as the Company’s Chief Financial Officer for an additional year commencing on October 1, 2018. Pursuant to the terms of the one (1) year renewal, the Company will pay aggregate consideration of $52,000, consisting of $48,000 in cash and issue 2,000,000 shares of common stock valued at the nominal price of $0.002 per share resulting in a total value of $4,000 for financial accounting purposes with the total amount to be expensed over the term of the renewal period through September 30, 2019. On December 16, 2019, Mr. King’s agreement was renewed through September 30, 2020 at the annual salary of $48,000. As of March 31, 2020 and December 31, 2019, the Company had not yet paid $168,000 and $156,000, respectively, of Mr. King’s salary and these amounts are included in accrued officers’ salaries payable at March 31, 2020 and December 31, 2019 (see Note 6). $1,000 of the total stock value of $4,000 was expensed in 2018 with the remaining $3,000 value expensed during 2019.

 

 

PostAds, Inc.

Notes to the Financial Statements

March 31, 2020

(unaudited)

 

NOTE 10 – COMMITMENTS AND CONTINGENCIES (continued)

 

Legal Proceedings

 

As of March 31, 2020, there were no pending or threatened lawsuits that could reasonably be expected to have a material effect on the results of our operations.

 

NOTE 11 – RELATED PARTY TRANSACTIONS

 

Accrued officers’ salaries payable in the amounts of $397,375 and $369,125 are recorded on the Company’s books at March 31, 2020 and December 31, 2019, respectively. (See Note 6 – LIABILITIES)

 

Advances payable – officer in the amounts of $134,305 and $119,845 are recorded on the Company’s books at March 31, 2020 and December 31, 2019, respectively. (See Note 7 – ADVANCES)

 

Loan payable – related party in the amount of $20,000 is recorded on the Company’s books at March 31, 2020 and December 31, 2019. (See Note 8 – LOAN PAYABLE)

 

On October 1, 2017, the Company renewed its agreement with Kenneth T. Moore to act as the Company’s Chief Executive Officer for an additional two (2) year term commencing December 28, 2017 at the same annual salary of $65,000 and on December 16, 2019, Mr. Moore’s agreement was renewed through December 31, 2020 at the same annual salary. (See Note 10 – COMMITMENTS AND CONTINGENCIES - Employment Agreements)

 

On November 15, 2018, the Company renewed its agreement with Colm J. King to act as the Company’s Chief Financial Officer for an additional year commencing on October 1, 2018. Pursuant to the terms of the one (1) year renewal, the Company will pay aggregate consideration of $52,000, consisting of $48,000 in cash and issue 2,000,000 shares of common stock. On December 16, 2019, Mr. King’s agreement was renewed through September 30, 2020 at the annual salary of $48,000. (See Note 10 – COMMITMENTS AND CONTINGENCIES - Employment Agreements)

 

NOTE 12 - SUBSEQUENT EVENTS

 

During the period from April 1, 2020 through May 13, 2020, the Company’s Chief Executive Officer advanced $9,834 to the Company to pay general and administrative expenses.

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

Cautionary Forward - Looking Statement

 

The following discussion and analysis of the results of operations and financial condition of PostAds, Inc. should be read in conjunction with the unaudited financial statements, and the related notes. References to “we,” “our,” or “us” in this section refers to the Company and its subsidiaries. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements.

 

Certain matters discussed herein may contain forward-looking statements that are subject to risks and uncertainties.

 

Such risks and uncertainties include, but are not limited to, the following:

 

	●	the volatile and competitive nature of our industry,
	●	the uncertainties surrounding the rapidly evolving markets in which we compete,
	●	the uncertainties surrounding technological change of the industry,
	●	our dependence on its intellectual property rights,
	●	the success of marketing efforts by third parties,
	●	the changing demands of customers and
	●	the arrangements with present and future customers and third parties.

 

Should one or more of these risks or uncertainties materialize or should any of the underlying assumptions prove incorrect, actual results of current and future operations may vary materially from those anticipated.

 

OVERVIEW

 

PostAds, Inc. (the “Company”) was formed on August 17, 2015 in the State of Nevada as a reorganization of a sole proprietor business with an inception date of August 26, 2013. The business was formed to provide an online platform at www.PostAds.com that offers an alternative marketplace for buyers and sellers of both new and pre-owned goods and service items (including jobs) together in an online market place that offers both retailers and service providers a forum to advertise and promote their goods and services while providing consumers a cost-effective way of locating and purchasing goods and services.

 

We are in the development stage since we have not commenced planned principal operations. Our activities since inception include devoting substantially all of our efforts to business planning and development. Additionally, we have allocated a substantial portion of our time and investment to the completion of our development activities to launch our marketing plan and generate revenues and to raising capital. We have generated minimal revenue from operations. The Company’s activities during the development stage are subject to significant risks and uncertainties.

 

Our principal executive office is located at 2332 NW 87^th Drive, Coral Springs, Florida 33065 and our telephone number is 954-464-1642. Our website is located at www.PostAds.com.

 

Unless the context otherwise requires, we use the terms “PostAds,” “PostAds MarketPlace,” the “Company,” “we,” “us” and “our” on Form 10-Q to refer to PostAds, Inc.

 

Operations

 

We operate an online marketplace at www.PostAds.com which provides a platform for buyers and sellers to purchase new and used goods and services. Because we offer an internet site where buyers are charged no fees and sellers of products and services can list their products and services without charge in all categories other than employment and personal ads, we expect to generate a large number of registered users who place product and service ads. After the inventories of product and service ads are generated, we expect to generate revenue from premium placement, ad enhancements and advertisements on our website directed at visitors to our site. We also plan to generate revenue from two paid ad categories, employment and personals. There is no assurance that we will be successful in these efforts.

 

We completed our initial website in August of 2015 and completed enhanced features of our site in April of 2016. Since our inception, we have placed over 25,430 free ads and obtained 7,101 registered users of the Post Ads marketplace.

 

We plan to convert our registered users into paying users by offering enhanced listings to increase the visibility of the ad. Because we offer free ads in all categories other than employment and personal, we expect our registered user base and product and service offerings to continually increase over time.

 

Our key activities to date include: (i) development of the business plan and plan of operations for the Post Ads Marketplace; (ii) development of the retail and fee-for-service features of the Post Ads Marketplace (iii) development of the auction platform of the Post Ads Marketplace; (iv) creation of our classified ad categories and features for the Post Ads Marketplace; (v) entering into an agreement with our website developer; (vi) creating features allowing visitors to become registered users of our online marketplace (vii) setting up our initial website to generate registered users, (viii) obtaining 7,101 registered users, (ix) placing more than 25,430 ads without charge and screening the ads prior to placement to ensure compliance with our terms of service, and (x) completing our website and enhancing its features including functionality and security features.

 

We plan to attempt to raise additional equity financing and procure loans to fund our future operations though there is no assurance we will succeed. We have not generated meaningful revenues from our business operations and are dependent on our ability to raise capital. If we are unable to raise all the capital we are seeking we may have to reduce our planned expenditures to a level where we can continue to operate until we obtain necessary financing. If we cannot obtain such financing and do not generate sufficient revenue to fund our operations, we may have to curtail or cease operations.

 

 

The PostAds Marketplace

 

Our marketplace is structured so that we offer sellers free listings in all categories other than employment and personal ads so that we can continuously increase our registered users. As the number of visitors for free product and service listings grows, the PostAds marketplace will become an attractive platform for sellers and other businesses seeking to purchase listing enhancements and advertising for their products and services. For sellers of goods and services, our goal is to provide the most effective and economical posting of ads on the internet. Sellers can post classified ads for free for products and services. All users of the site can view all posted ads without charge. Because we are an internet based business, our success depends upon attracting visitors to our site. To date, we have placed over 25,430 ads without charge on the PostAds Marketplace. This resulted in 7,101 registered non-paying users.

 

Because the product and service ads are free, we expect to generate a large inventory of ads. After the inventories of ads are generated, we expect to be able to sell premium placement, ad enhancements and advertisements on our site to non-paying and paying sellers of goods and services.

 

PostAds is striving to differentiate itself from its competitors by its simplicity, while offering customers value, selection and convenience in order to gain their trust and continued business. The PostAds Marketplace facilitates buying and selling used goods while reducing the time our customers need to devote to a transaction.

 

To buy and sell on our marketplace, visitors must open an online account by completing a one (1) page fill in the blank form that includes the user’s name, street address, email and whether the account is for personal or business use.

 

Marketing Strategy and Plan

 

We began executing our initial marketing strategy and plan during the period from April 2016 through July of 2016. It involved email marketing and print materials targeting retail store front owners in April of 2016, initial email marketing and print materials targeting service providers for our fee-for-service store fronts in May of 2016, converting our registered members to paying users by sending monthly newsletters with updates and company information in July of 2016 and social media postings using Facebook in July of 2016.

 

In November of 2016, we planned to establish Google AdWords and search engine optimization campaigns to drive traffic to our website and to develop email marketing and print materials to attract potential advertisers to our website. We now plan to establish Google AdWords and develop email marketing and print materials in the second half of 2020.

 

Executing our initial marketing strategy and plan was dependent upon raising sufficient capital through the placement of our common stock or issuance of debt securities. On September 22, 2015, the Company prepared an offering to raise capital in the amount of $200,000 by offering up to 4,000,000 shares of its common stock at $.05 per share, from which we sold 2,978,400 shares of common stock to nineteen (19) persons at the price of $.05 per share for aggregate proceeds of approximately $148,920. With the limited capital raised in the above offering we were able to execute our initial marketing strategy and plan, but management decided to postpone the continuation and initiation of the above programs until additional capital can be raised from the sale of our securities or financing can be secured. We anticipate having the ability to continue executing our marketing strategy and plan during the second half of 2020. The dates and details of our planned marketing activity and our milestones and enhancements completed to date are presented in detail in the Marketing section below.

 

 

Online Classified Industry

 

There is an estimated market of $381 billion worth of used but untouched goods in U.S. homes. Classified advertising has evolved to a whole new domain. They are few newspaper specific advertisements. The operating model of today’s classifieds platforms allow advertisements to be listed and can be accessed by everyone in just a few clicks.

 

Craigslist is the most profitable classified website in the world. With around 55 million monthly visitors Craigslist is the leader of the digital classifieds market. Craigslist and eBay are the two dominant players. Other online classified companies include Whatsapp, Facebook Marketplace, OfferUp and Quora with LetGo being one of the recent startups. Craigslist doesn’t market itself, doesn’t believe in changing the business model according to the business environment and is still leading the industry just because of its simple and selectively free interface and a huge network which it built in 2 decades.

 

Competitors like OfferUp and LetGo have plans and strategies to leave Craigslist behind. In 2016, OfferUp raised $130 million dollars in funding, bringing the company’s total funding to more than $221 million with a valuation of 1.2 billion. LetGo raised $175 million around 15 months after New York-based LetGo merged with Spanish rival Wallapop in a bid for more scale, amid yet another $100 million round. LetGo’s large rounds of funding made in quick succession are collectively a sign of how competitive its area is at the moment.

 

A mature online classified business can easily generate somewhere close to $500M in profits per year, which leaves huge revenue potential for remaining online classified businesses.

 

PostAds Core Team and Focus to Date

 

As PostAds builds a profitable business, management’s top priority will always be ensuring our customers convenience and security. In order to become successful, we are focusing on simplicity and empowering users of our products and services.

 

With limited funds available, our Chief Executive Officer, Kenneth T. Moore, our Chief Financial Officer, Colm J. King, and our website and software developer decided to adopt a ‘network first, profit later’ strategy. As an online-only business operating a classifieds business, talent and technology are required. Our core team is made up of individuals that bring the following talents and experience to PostAds, technology research and development, software design and modification, managerial, finance and SEC reporting and compliance.

 

Survival in the technology industry requires constant innovation and the majority of listings are facilitated by software, showing the value of automating posting. The foundation of our product and services development is based on continuous innovation in creating and improving the products and services we offer.

 

From January 1, 2019, through March, 31, 2020, our core team has devoted their time and effort to accomplishing the following overview of the developments, security, enhancements and compliance matters by quarter that have postured PostAds to raise the necessary capital for the successful execution of its marketing strategy and plan and become a competitive online classified Company:

 

2019

 

Developments / Enhancements

Enhance email inputs

Expand Browsing Filters to handle additional matters

Storefront: enhance Custom Pages

Additional Profile Pictures

 

Security

Maintenance upgrades

 

Compliance

Financial and compliance preparation

Company SEC filings

 

 

1st Quarter 2020

 

Developments / Enhancements

Continued enhancements as required

 

Security

Monthly maintenance upgrades

 

Compliance

Continued financial and compliance preparation to ensure current SEC filings

 

Listing Categories

 

Our platform offers the following four listing categories:

 

●	Retail Store Fronts	●Fee-For-Service Store Fronts
●	Auction Listings	●Classified Ads

 

Retail & Fee-For-Service Store Fronts

 

Our marketplace offers sellers of new and used goods and service providers the ability to create a unique user friendly internet storefront without the hassle and time required to manage their own website.

 

For services providers, our dashboard allows them to use a storefront to offer their service by category and by postal code. Service providers can personalize their listing by their type of service, service areas, availability, and Service provider rates.

 

Our Retail and Fee-For-Service Store fronts offering the following features:

 

●	A unique URL path that allows the seller to advertise in emails, on websites, etc. and drive traffic to their own store front.
●	An “off” StoreFront option to use during set up and maintenance.
●	A “StoreFront” column that is displayed on our category pages to drive traffic from our category pages to the seller’s store front page.
●	Display of Seller’s logos and slogans.
●	User friendly StoreFront templates.
●	Ability to create and populate store front ‘extra pages’ to provide more information to visitors.
●	Ability to create newsletters where visitors are able to subscribe directly from the store front.
●	Analytics that provide information to sellers about the traffic to their particular store front.

 

Auctions

 

We believe key advantages of our auction services over other services are that we offer auction ads without charge and we do not impose a final fee for auctioned items. We offer sellers using our auction feature, the ability to purchase premium placement, ad enhancements and advertisements of their items. Our marketplace provides sellers with three types of auctions:

 

●	Standard Auction. In standard actions, users bid against each other for individual or group items. Whatever is described within the details of the auction is what’s up for bid. At the end of the auction the highest bidder wins the item being auctioned.
●	Buy Now Action. In a Buy Now Action, a listing is placed. Within that listing there is be a Buy Now link that allows the Buyer to purchase the item for a set price established by the Seller.
●	Dutch Auction. In a Dutch Auction, Sellers list multiple items for sale and each bidder can win one or more of the total items listed with conditions designated by the Seller

 

The auction feature is designed to generate revenue by charging users for enhancements to their listing such as featured item, top of listing, and banner ads etc.

 

 

Revenues

 

We plan to generate revenues from:

 

●	Monthly Seller fees of $6.95 per month for each retail store front listing,
●	Monthly Seller fees $6.95 per month for each service store front listing,
●	Charging for ads in the Jobs category which currently has a fee of $5.00 per listing for a 30-day ad and personals category which has fees ranging from $1.00 to $15.00 depending on the category and ad duration, and Charging Sellers for ad enhancements to sellers.

 

Ad Enhancements

 

We plan to offer ad enhancements to sellers (including retail store front listings, service store front listings, action listings and classified ad listings) as follows:

 

● Banner Advertisements. Banner Advertisements are small rectangular advertisements that appear on pages of the PostAds Market Place. When a user clicks on a banner advertisement, it will take the user to a particular advertiser’s storefront or listing. Banner advertising fees range from $2.99 to $99.00 depending upon ad size, location and number of categories,

● Bulk Advertisements. The PostAds Bulk Uploader allows users to create multiple ads from a single transaction of data stored in a spreadsheet file and upload that file to multiple pages of the PostAds Market Place. Bulk advertising is free.

● Ad-Ons. Ad-On are enhancements to listings such as colored text, graphics and icons. Fees for Ad-On range from $0.25 to $3.00 per item, and

● Premium Placement Fees. Premium placement fees allow a user to select optimum locations for their ad or listing such as top of the page or first listing of the category. Premium placement fees range between $1.00 and $3.00 depending upon location.

 

The Chart below summarizes the ad enhancements we offer:

 

Type of Ad		Feature			Monthly Listing Fees
Retail Store Front		Allows users to create their own webpages/store front within our website to sell their own goods			$	6.95
Service Store Front		Allows users to create their own webpages/store front within our website to sell their own services			$	6.95
Auction Listing		Auction listings allow Sellers to offer goods in a bidding auction and include a buy now option.			$	0
Classified Listings Other than Jobs & Personal Ads		Classified listings allow sellers to place goods and/or services under various categories.			$	0
Paid Classified Categories Jobs & Personal Ads		Jobs & Personal Ads			$	5.00 Per month per listing

 

All transactions are processed through PayPal. We do not charge fees to purchasers on the PostAds marketplace.

 

PostAds Marketplace Features

 

A key feature of the PostAds Marketplace is the search feature that allows buyers of goods and services to locate particular items of interest within the various areas of our website using a keyword search. The search feature allows the user to search within specific listing categories and by geographic region. Our bulk uploader allows sellers to post multiple advertisements and listings in multiple categories at the same time. As summarized below, our site offers user friendly features to enhance the PostAds experience. The enhanced version of the site was launched in April 2016.

 

Website Feature		Feature		Revenue
Bulk Uploader Auction and Classified Ad		Allows Auction and Classified Ad Sellers to upload ads for multiple products and/or services at the same time		There is no charge to users of this feature.
Feature for Buyers		Allows buyers to search for items or services they wish to purchase throughout different categories (retail store front, service store front classified ads and auction) at the same time		There is no charge to users of this feature.
Bulk Uploader for Store Fronts		Allows store front sellers to upload ads for multiple products and/or services at the same time to their store front.		There is no charge to users of this feature.

 

 

Benefits of the PostAds Marketplace

 

We believe the PostAds Marketplace offers benefits not found with other on line shopping platforms particularly for smaller buyers and sellers of inexpensive items because we plan to offer the primary features found on other auction sites like Ebay without the fees that they charge. We provide different platforms to buyers and sellers including auctions, storefronts and classified ads. We do not charge fees to buyers and we offer basic listings without charge to the Seller in all categories other than classified ads for employment and personals. Ebay in most instances charges an item insertion fee as well as a final value fee (percentage of sale price) making it costly for smaller sellers to list their items for sale. This fee in turn increases the price paid by small buyers. By not charging these fees and offering ad enhancements that are optional, we may be able to attract smaller sellers and buyers that are unwilling to pay the fees charged by Ebay. Craigslist provides classified ads but it does not offer an auction platform nor on their classifieds do they offer a user storefronts or listing enhancements. Similarly, Ebay does not offer classifieds. We are not aware of any marketplaces offering the combination of platforms that we offer. We also believe that by offering store fronts, classifieds and auctions, we are able to migrate other online marketplace users to our website.

 

Marketing

 

To date, our Company has grown organically by word of mouth supported by internal efforts to stimulate awareness and interest. During the second half of 2016, we invested minimally in marketing our products and services to build our brand and grow our user base. In addition, we also plan to attract visitors by developing our “PostAds Marketplace” brand name and “No Fees for Buyers” slogan to attract visitors to our PostAds Marketplace.

 

Our initial marketing strategy involves converting our registered members to paying users. We plan to accomplish this by sending monthly newsletters with updates and company information. We started this for a brief period in July of 2016 and plan to begin sending newsletters with updates during September of 2020.

 

We plan to also conduct the following marketing activity:

 

●	We completed our initial email marketing and print materials targeting retail store front owners in April of 2016, and plan to deliver these materials in September of 2020 and use this as an ongoing method of marketing.
●	We started social media postings using Facebook in July of 2016. We plan to launch social media campaigns on Twitter, Facebook, Linked-in and other websites to create recognition of our market place and drive traffic to our website beginning September of 2020, and use this as an ongoing form of marketing.
●	We completed our initial email marketing and print materials targeting service providers for our fee-for-service store fronts in May of 2016, and plan to deliver these materials in September of 2020 and use this as an ongoing form of marketing.
●	In September of 2020 we plan to establish Google AdWords and search engine optimization campaigns to drive traffic to our website.
●	In September of 2020, we plan to develop email marketing and print materials to attract potential advertisers to our website.
	We believe that a marketing mix of email and social media campaigns and internet advertising is an optimal strategy to increase revenues.

 

RESULTS OF OPERATIONS

 

We are in the development stage since we have not commenced planned principal operations. Our activities since inception include devoting substantially all of our efforts to business planning and development. Additionally, we have allocated a substantial portion of our time and investment to the completion of our development activities to launch our marketing plan and generate revenues and to raising capital. We have generated minimal revenue from operations. The Company’s activities during the development stage are subject to significant risks and uncertainties.

 

 

The accompanying unaudited financial statements have been prepared on a going concern basis, which assumes the Company will realize its assets and discharge its liabilities in the normal course of business. As reflected in the accompanying unaudited financial statements, the Company had an accumulated deficit, stockholders’ deficit and working capital deficit of $2,552,436, $571,716 and $571,716, respectively, at March 31, 2020 and for the three months ended March 31, 2020 the Company had a net loss and net cash used in operating activities of $45,829 and $13,921, respectively. These factors raise substantial doubt about the Company’s ability to continue as a going concern.

 

The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

 

Results and comparison of the three month periods ended March 31, 2020 and 2019

 

The Company had minimal revenues of $27 and $2 for the three month periods ended March 31, 2020 and 2019, respectively, since we had not yet initiated our sales and marketing programs and we had allocated a substantial portion of our time and investment to the completion of our development activities required in order to launch our marketing plan. With the anticipated commencement of our advertising and marketing programs during the second half of 2020, we expect the number of visitors for free product and service listings to increase and we expect to be able to sell premium placement, ad enhancements and advertisements on our site to non-paying and paying sellers of goods and services.

 

Operating expenses were $45,356 and $33,792 for the three month periods ended March 31, 2020 and 2019, respectively.

 

Operating expenses consisted of $28,250 of officer compensation and $17,106 of general and administration for the three month period ended March 31, 2020. Operating expenses consisted of $31,750 of officer compensation and $2,042 of general and administration for the three month period ended March 31, 2019.

 

Interest expense was $500 for each of the three month periods ended March 31, 2020 and 2019.

 

The Company had net losses of $45,829 and $34,290 for the three month periods ended March 31, 2020 and 2019, respectively.

 

Based on 40,036,400 weighted average shares outstanding for the three months ended March 31, 2020, the loss per share was ($0.001).

 

LIQUIDITY AND CAPITAL RESERVES

 

Sources of Liquidity

 

For the three month period ending March 31, 2020, we generated revenues of $27 from our business operations. We funded our working capital requirements through non-interest bearing advances of $14,460 to the Company by the Company’s Chief Executive Officer, utilized to pay general and administrative expenses.

 

We are attempting to raise additional equity financing and procure loans to fund our future operations though there is no assurance we will succeed. We have not generated meaningful revenues from our business operations and are dependent on our ability to raise capital. If we are unable to raise all the capital we require we may have to reduce our planned expenditures to a level where we can continue to operate until we obtain necessary financing. If we cannot obtain such financing and do not generate sufficient revenue to fund our operations, we may have to curtail or cease operations.

 

We are dependent on the sale of our securities to fund our operations, and will remain so until we generate sufficient revenues to pay for our operating costs. Our officers and directors have made no written commitments with respect to providing a source of liquidity in the form of cash advances, loans and/or financial guarantees. We currently have no external sources of liquidity such as arrangements with credit institutions or off-balance sheet arrangements that will have or are reasonably likely to have a current or future effect on our financial condition or immediate access to capital.

 

If we are unable to raise the funds we will seek alternative financing through means such as borrowings from institutions or private individuals. There can be no assurance that we will be able to raise the capital we need for our operations from the sale of our securities. We have not located any sources for these funds and may not be able to do so in the future. We expect that we will seek additional financing in the future. However, we may not be able to obtain additional capital or generate sufficient revenues to fund our operations. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to cease operations. If we fail to raise funds we expect that we will be required to seek protection from creditors under applicable bankruptcy laws.

 

 

Net Cash Used in Operating Activities

 

Net cash used in operating activities was $13,921 in the three months ended March 31, 2020, primarily as a result of the net loss of $45,829 offset with an increase in accrued officers’ salaries of $28,250 and accrued liabilities of $3,658.

 

Net cash used in operating activities was $9,678 in the three months ended March 31, 2019, primarily as a result of the net loss of $34,290 offset an increase in accrued officers’ salaries of $28,250.

 

Net Cash Used in Investing Activities

 

Net cash used in investing activities was $0 in the three month periods ended March 31, 2020 and 2019.

 

Net Cash Provided by Financing Activities

 

Net cash provided by financing activities was $14,451 in the three months ended March 31, 2020 and was primarily attributable to proceeds from related party advances of $14,460.

 

Net cash provided by financing activities was $9,686 in the three months ended March 31, 2019 and was primarily attributable to proceeds from related party advances of $9,690.

 

Contractual Obligations

 

On December 28, 2015, the Company entered into an agreement with Kenneth T. Moore to act as the Company’s Chief Executive Officer for a term of two (2) years at an annual salary of $65,000. On October 1, 2017, the Company renewed its agreement with Kenneth T. Moore to act as the Company’s Chief Executive Officer for an additional two (2) year term commencing December 28, 2017 at the same annual salary of $65,000 and on December 16, 2019, Mr. Moore’s agreement was renewed through December 31, 2020 at the same annual salary.

 

On October 1, 2016, the Company entered into an agreement with Colm J. King to act as the Company’s Chief Financial Officer. Pursuant to the terms of the one year agreement, the Company will pay aggregate consideration of $48,000 in cash and issued 1,000,000 shares of common stock on October 1, 2016. On October 1, 2017 and November 15, 2018, the Company renewed the agreement for additional one year terms commencing October 1, 2017 and 2018 at the same annual cash salary of $48,000. On December 16, 2019, Mr. King’s agreement was renewed through September 30, 2020 at the annual salary of $48,000.

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

 

Not applicable.

 

ITEM 4. CONTROLS AND PROCEDURES.

 

(a) Evaluation of Disclosure Controls and Procedures

 

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of March 31, 2020. “Disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) accumulated and communicated to the company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Based on the evaluation of our disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were ineffective as of March 31, 2020.

 

(b) Changes in Internal Control Over Financial Reporting

 

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) or 15d-15(d) of the Exchange Act during the first quarter of 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

(c) Limitations on Controls

 

Our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving the desired control objectives. Our management recognizes that any control system, no matter how well designed and operated, is based upon certain judgments and assumptions and cannot provide absolute assurance that its objectives will be met. Similarly, an evaluation of controls cannot provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.

 

 

PART II – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS.

 

See “Note 10 – Commitments and Contingencies—Legal Proceedings” in the Notes to the Financial Statements.

 

ITEM 1A. RISK FACTORS.

 

Investing in our common stock involves a high degree of risk. You should consider carefully the risks and uncertainties described in our Annual Report on Form 10-K, our financial statements and related notes, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the other information in this Quarterly Report on Form 10-Q. If any of these risks actually occur, our business, financial condition, results of operations and prospects could be adversely affected. As a result, the price of our common stock could decline and you could lose part or all of your investment.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

 

Not applicable.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

 

Not applicable.

 

ITEM 4. MINE SAFETY DISCLOSURES.

 

Not applicable.

 

ITEM 5. OTHER INFORMATION.

 

Not applicable.

 

ITEM 6. EXHIBITS.

 

See Exhibit Index below for exhibits required by Item 601 of regulation S-K.

 

EXHIBIT INDEX

 

Exhibit No. Description

 

List of Exhibits attached or incorporated by reference pursuant to Item 601 of Regulation S-K:

 

Exhibit		Description
31.1*		Certification under Section 302 of Sarbanes-Oxley Act of 2002
31.2*		Certification under Section 302 of Sarbanes-Oxley Act of 2002
32.1*		Certification under Section 906 of Sarbanes-Oxley Act of 2002
32.2*		Certification under Section 906 of Sarbanes-Oxley Act of 2002
101*		Interactive Data Files pursuant to Rule 405 of Regulation S-T

 

* Filed herewith.

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	POSTADS, INC.
Date: May 14, 2020	By:	/s/ Kenneth T. Moore
		Kenneth T. Moore
		President, Chief Executive Officer and Director
		(Principal Executive Officer)
Date: May 14, 2020	By:	/s/ Colm J. King
		Colm J. King
		Chief Financial Officer
		(Principal Accounting Officer)