PINX:PTAM Potash America Inc Quarterly Report 10-Q Filing - 6/30/2012

Effective Date 6/30/2012

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

x

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

For the quarterly period ended

June 30, 2012

 

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

333-150775

POTASH AMERICA, INC.

(Exact name of registrant as specified in its charter)

Nevada

 

41-2247537

(State or other jurisdiction of incorporation or organization)

 

(IRS Employer Identification No.)

8th Floor – 200 South Virginia Street, Reno,  Nevada

89501

(Address of principal executive offices)

(Zip Code)

775.398.3019

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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 and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-K (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

x

YES

¨

NO

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

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

¨

(Do not check if a smaller reporting company)

Smaller reporting company

x

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

¨

YES

x

NO

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.     

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

¨

YES

¨

NO

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

148,665,000 common shares issued and outstanding as of August 10, 2012







PART 1 – FINANCIAL INFORMATION

Item 1.  Financial Statements

Our unaudited interim financial statements for the three month period ended June 30, 2012 form part of this quarterly report.  They are stated in United States Dollars (US$) and are prepared in accordance with United States generally accepted accounting principles.










2













POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)


(AN EXPLORATION STAGE COMPANY)


FINANCIAL STATEMENTS


JUNE 30, 2012




3










POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)


(AN EXPLORATION STAGE COMPANY)


TABLE OF CONTENTS


JUNE 30, 2012




Balance Sheets (Unaudited) as of

June 30, 2012 and March 31, 2012

F-1


Statements of Operations (Unaudited) for the three months ended

June 30, 2012 and 2011 and for the period from

July 31, 2007 (Date of Inception) to June 30, 2012

F-2


Statements of Cash Flows (Unaudited) for the three months ended

June 30, 2012 and 2011 and for the period from

July 31, 2007 (Date of Inception) to June 30, 2012

F-3


Notes to the Financial Statements

F-4 - F-12





4


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

BALANCE SHEETS (UNAUDITED)

AS OF JUNE 30, 2012 AND MARCH 31, 2012


 

June 30, 2012

March 31, 2012

ASSETS

 

 

Current Assets

 

 

Cash and cash equivalents

$      158,544

$         69,323

Prepaid expenses

140,594

132,058

Deposits

50,500

50,000

Total Current Assets

349,638

251,381

 

 

 

Fixed Assets

 

 

Mining claim

711,645

515,645

Total Fixed Assets

711,645

515,645

 

 

 

Other Assets

 

 

Prepaid expenses

-

107,639

Total Other Assets

-

107,639

 

 

 

Total Assets

$   1,061,283

$       874,665

 

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

Current Liabilities

 

 

Accrued expenses

$          6,141

$           5,761

Deferred compensation

95,500

65,500

Accrued interest

50,638

28,327

Notes payable – related parties

35,500

35,500

Line of credit

1,330,000

1,030,000

Total Liabilities

1,517,779

1,165,088

 

 

 

Stockholders’ Deficit

 

 

Common stock, par value $0.0001; 200,000,000 shares authorized, 148,665,000 and 147,665,000 shares issued and outstanding

14,867

14,767

Treasury stock

(10,000)

-

Additional paid in capital  

1,471,242

1,233,927

Deficit accumulated during the exploration stage

(1,932,605)

(1,539,117)

Total Stockholders’ Deficit

(456,496)

(290,423)

 

 

 

Total Liabilities and  Stockholders’ Deficit

$   1,061,283

$       874,665









The accompanying notes are an integral part of these financial statements




F-1


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED JUNE 30, 2012 AND 2011

FOR THE PERIOD FROM JULY 31, 2007 (INCEPTION) TO JUNE 30, 2012


 

Three months ended June 30, 2012

Three months ended June 30, 2011

Period from July 31, 2007 (Inception) to June 30, 2012

 

 

(Restated)

 

 

 

 

 

REVENUE

$                    -

$                    -

$                    -

 

 

 

 

OPERATING EXPENSES

 

 

 

Professional fees

55,409

14,759

225,212

Transfer agent and filing fees

1,372

1,948

40,381

Consulting

41,715

11,700

213,141

Web development

1,175

10,545

29,283

Stock compensation (note 11)

149,055

303,115

1,118,226

Exploration costs

106,183

                   -

144,443

General and administrative

16,269

14,125

111,142

TOTAL OPERATING EXPENSES

371,178

356,192

1,881,828

 

 

 

 

LOSS FROM OPERATIONS

(371,178)

(356,192)

(1,881,828)

 

 

 

 

OTHER INCOME (EXPENSES)

 

 

 

Interest expense

(22,310)

(1,133)

(50,777)

TOTAL OTHER INCOME (EXPENSES)

(22,310)

(1,133)

(50,777)

 

 

 

 

NET LOSS PRIOR TO INCOME TAXES

(393,488)

(357,325)

(1,932,605)

 

 

 

 

PROVISION FOR INCOME TAXES

-

-

-

 

 

 

 

NET LOSS

$      (393,488)

$      (357,325)

$   (1,932,605)

 

 

 

 

NET LOSS PER SHARE: BASIC AND DILUTED

$            (0.00)

$            (0.00)

 

 

 

 

 

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING

147,675,989

147,254,000

 












The accompanying notes are an integral part of these financial statements




F-2


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE THREE MONTHS ENDED JUNE 30, 2012 AND 2011

FOR THE PERIOD FROM JULY 31, 2007 (INCEPTION) TO JUNE 30, 2012


 

Three months ended June 30, 2012

Three months ended June 30, 2011

Period from July 31, 2007 (Inception) to June 30, 2012

 

 

(Restated)

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

Net loss for the period

$     (393,488)

$     (357,325)

$  (1,932,605)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

Stock-based compensation (note 11)

149,055

303,115

1,118,226

Changes in assets and liabilities:

 

 

 

(Increase) in prepaid expenses

(8,536)

(2,280)

(32,955)

(Increase) in deposit

(500)

4,036

(50,500)

Increase (decrease) in accrued expenses

-

(11,723)

-

Increase in accrued interest

22,310

1,133

50,638

Increase in accounts payable

380

-

6,141

Increase in deferred compensation

30,000

4,500

95,500

Net Cash Used in Operating Activities

(200,779)

(58,544)

(745,555)

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

Acquisitions of mineral properties

-

(50,000)

(515,645)

Net Cash Used in Investing Activities

                    -

(50,000)

(515,645)

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

Proceeds from notes payable – related parties

-

115,000

49,744

Proceeds from line of credit

300,000

                    -

1,330,000

Proceeds from sale of stock

-

-

50,000

Purchase of treasury stock

(10,000)

                    -

(10,000)

Net Cash Provided by Financing Activities

290,000

115,000

1,419,744

 

 

 

 

INCREASE IN CASH

89,221

6,456

158,544

Cash, beginning balance

69,323

7,184

-

Cash, ending balance

$       158,544

$         13,640

$       158,544

 

 

 

 

SUPPLEMENTAL CASH FLOW INFORMATION:

 

 

 

Cash paid for interest

$                   -

$                   -

$                   -

Cash paid for income taxes

$                   -

$                   -

$                   -

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING INFORMATION:

 

 

 

Forgiveness of debt from former shareholder converted to capital

$                   -

$                   -

$         14,244

Stock options issued as prepaid expense

$       107,639

$                   -

$       107,639

Issuance of common stock to acquire mineral properties

$       196,000

$                   -

$       196,000







The accompanying notes are an integral part of these financial statements




F-3


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 1 – NATURE OF OPERATIONS


Potash America, Inc. (formerly Adtomize Inc.) (“the Company” or “PTAM”), was incorporated in the state of Nevada on July 31, 2007. PTAM’s primary focus is the development of fertilizer and agri-business assets. Such assets may include Potash, Montmorillonite, Bentonite and Gypsum. The Company seeks to acquire known deposits whose economic value has recently changed with market pricing levels, and develop these assets into agri-products.


NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES


Exploration Stage Company

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to accounting and reporting by exploration stage companies.  An exploration stage company is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from.


Basis of Presentation

The accompanying interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, stockholders’ deficit or cash flows. It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.  The interim unaudited financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K, which contains the annual audited financial statements and notes thereto, together with the Management’s Discussion and Analysis, for the year ended March 31, 2012. The interim results for the period ended June 30, 2012 are not necessarily indicative of the results for the full fiscal year.  The interim unaudited financial statements are presented in USD.  


Accounting Basis

The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting).  The Company has adopted a March 31 fiscal year end.


Financial Instrument

The Company's financial instrument consists of cash, prepaid expenses, deposits, accrued expenses, deferred compensation, amounts due to stockholders and a line of credit.

 

The amounts due to stockholders are non-interest bearing.  It is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from its other financial instruments and that their fair values approximate their carrying values except where separately disclosed.


Cash and Cash Equivalents

PTAM considers all highly liquid investments with maturities of three months or less to be cash equivalents.  At June 30, 2012 and March 31, 2012, respectively, the Company had $158,544 and $69,323 of cash.




F-4


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


Mineral rights, property and acquisition costs

Since March 31, 2011, the Company is primarily engaged in the acquisition and exploration of mining properties. The Company has not yet realized any revenues from its planned operations.


The Company capitalizes acquisition and option costs of mineral rights as tangible assets. Upon commencement of commercial production, the mineral rights will be amortized using the unit-of-production method over the life of the mineral rights. If the Company does not continue with exploration after the completion of the feasibility study, the mineral rights will be expensed at that time.


The costs of acquiring mining properties are capitalized upon acquisition.  Mine development costs incurred to develop and expand the capacity of mines, or to develop mine areas in advance of production are also capitalized once proven and probable reserves exist and the property is a commercially mineable property. Costs incurred to maintain current exploration or to maintain assets on a standby basis are charged to operations.  Costs of abandoned projects are charged to operations upon abandonment.  The Company evaluates the carrying value of capitalized mining costs and related property and equipment costs, to determine if these costs are in excess of their recoverable amount whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.  Evaluation of the carrying value of capitalized costs and any related property and equipment costs are based upon expected future cash flows and/or estimated salvage value in accordance with Accounting Standards Codification (ASC) 360-10-35-15, Impairment or Disposal of Long-Lived Assets.


Impairment of long-lived assets

The Company reviews and evaluates long-lived assets for impairment when events or changes in circumstances indicate the related carrying amounts may not be recoverable. The assets are subject to impairment consideration under ASC 360-10-35-17, Measurement of an Impairment Loss, if events or circumstances indicate that their carrying amount might not be recoverable.  As of June 30, 2012, exploration progress is on target with the Company’s exploration and evaluation plan and no events or circumstances have happened to indicate that the related carrying values of the properties may not be recoverable. When the Company determines that an impairment analysis should be done, the analysis will be performed using the rules of FASB ASC 930-360-35, Asset Impairment, and 360-10-15-3 through 15-5, Impairment or Disposal of Long-Lived Assets.


Advertising

The Company expenses advertising costs as incurred.  The Company has had no advertising activity since inception.


Revenue Recognition

The Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.


Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles of the United States 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 year. The more significant areas requiring the use of estimates include asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.




F-5


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)


Basic Income (Loss) Per Share

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of June 30, 2012.


During the year ended March 31, 2011, the Company enacted an 80 to 1 forward stock split. All share and per share data has been adjusted to reflect such stock split.


Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718.  On March 31, 2011, the Company instituted a Stock Option Plan which allows for the issuance of 3,000,000 shares of common stock to the Company’s management, employees and consultants. As of June 30, 2012, the Company issued 148,665,000 common stock shares and has issued 1,270,000 in stock options in lieu of compensation.


Income Taxes

Income taxes are computed using the asset and liability method.  Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws.  A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.


Recent Accounting Pronouncements

PTAM does not expect the adoption of recently issued accounting pronouncements to have a significant impact on the Company’s results of operations, financial position or cash flow.


NOTE 3 – MINING PROPERTY


On June 6, 2011, we entered into and closed a property acquisition agreement with Habitants Minerals Ltd. Pursuant to the terms of the agreement; we acquired an undivided 100% interest in certain unpatented mining claims located in Western Newfoundland, Canada which we refer to as the “Newfoundland Property”. Pursuant to the terms of the agreement, we agreed to provide the following payments to Habitants:


The aggregate consideration of $50,000 consisting of the following:


·

$30,000 which was previously provided to Habitants, and

·

the balance of $20,000 which was provided on the closing of the agreement.


If we identify any material defect in Habitant’s title to the Newfoundland Property, we shall give Habitants notice of such defect. If the defect has not been cured within 30 days of receipt of such notice, we shall be entitled to take such curative action as is reasonably necessary, and shall be entitled to deduct the costs and expenses incurred in taking such action from the payments then otherwise due or accruing due to Habitants. If there are no such payments, we shall be entitled to a refund in the amount of said costs and expenses.




F-6


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 3 – MINING PROPERTY (CONTINUED)


If any third party asserts any right or claim to the Newfoundland Property or to any amounts payable to Habitants, we may deposit any amounts otherwise due to Habitants in escrow with a suitable agent until the validity of such right or claim has been finally resolved. If we deposit said amounts in escrow, we shall be deemed not in default under this agreement for failure to pay such amounts to Habitants.


On August 31, 2011, we entered into a purchase and sale agreement with Ms. Kim Diaz and Sonseeahry related to the acquisition of the 100% interest in the Sodaville Claims. Under the terms of the purchase and sale agreement our company issued a pre-closing advance of $200,000 (paid on August 29, 2011).


As additional consideration our company will pay compensation as follows:


1.

$200,000 on November 31, 2011 (paid);

2.  $50,000 on July 1, 2012 (paid);

3.  $1,500,000, which will be paid in equal payments of $500,000 on or before January 1st of 2013, 2014 and 2015;

4.  2,500,000 shares of our company’s common stock based on the pro-rata interest in the claims and a total of 500,000 shares to those parties designated by the sellers on or before July 1st of 2012, 2013 and 2014;


We have also agreed to pay a royalty of $10 per short ton of product produced from the Sodaville Claims and sold by our company.


Our company has also located an additional 48 unpatented lode mining claims in the area in which the Sodaville Claims are located. As part of the consideration our company will also pay the sellers a royalty of $10 per short ton of product produced from the Additional Claims and sold by our company. In addition to granting the royalty in the Additional Claims our company will issue 50,000 shares of restricted stock to the sellers on or before January 1, 2015.


Our company shall also reserve a NSR Royalty on certain metallic products produced from the Sodaville Claims equal to 2% of the net smelter returns. The NSR Royalty shall not apply to and no NSR Royalty payments shall be due for any product produced from the Sodaville Claims sold by our company.


Additionally, our company will pay the sellers a guaranteed minimum annual royalty of $50,000 for a period of 5 years with the first payment due on December 31, 2015 and the last payment due on December 31, 2020.


There has been no mining of resources to date.


NOTE 4 – PREPAID EXPENSES


Prepaid expenses consisted of $32,955 of prepaid legal fees and insurance and $107,639 of stock compensation as of June 30, 2012.


NOTE 5 – DEPOSITS


The current deposits of $50,500 consist of $50,000 for drilling services at the BLM Claim and $500 in a rent deposit near site.




F-7


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE, INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012

NOTE 6 – ACCRUED EXPENSES


Accrued expenses and liabilities consisted of the following as of June 30, 2012 and March 31, 2012:


 

June 30,

2012

March 31, 2012

Accounting fees

$              861

$               -

Legal fees

3,836

5,588

Filing fees

247

173

Exploration

1,197

-

Total Accrued Expenses

$           6,141

$       5,761


NOTE 7 – NOTES PAYABLE – RELATED PARTIES


A shareholder and current director of the Company advanced funds at various times during the year ended March 31, 2011 in order to support operations. The loans are unsecured, non-interest bearing and due on demand. The amount due to the shareholder and director was $35,500 as of June 30, 2012.


NOTE 8 – LINE OF CREDIT


The Company entered into a Credit Facility Agreement during the year ended March 31, 2011 in the amount of $200,000. The line of credit is secured by the assets of the company, bears 5% interest and is due on demand.


On June 22, 2011, the Company’s credit line was increased from $200,000 to $1,000,000 under the same terms. The line of credit was drawn to $630,000 as of June 30, 2012.  Interest expense related to the line of credit was $28,277 as of June 30, 2012.  


On November 22, 2011, the Company entered into a second Credit Facility Agreement in which the lender agreed to provide the Company with a line of credit in the amount of up to $500,000. Pursuant to the terms of the Credit Facility Agreement, the Company shall pay any outstanding amounts to the lender on demand. The Company may also repay the loan and accrued interest at any time without penalty. Amounts outstanding shall bear interest at the rate of 10% per annum. The line of credit was drawn to $200,000 as of June 30, 2012.  Interest expense related to the line of credit was $17,681 as of June 30, 2012.  


On April 12, 2012, the Company entered into a US$1,000,000 Letter of Credit Agreement dated March 27, 2012. Pursuant to the terms outlined in the Letter of Credit, at any time the Company may require any and all funds outstanding under the Letter of Credit, except for accrued interest which is to be paid in cash, to be converted into units of the Company at a price of $0.80 per unit (the “Unit”). Each Unit consists of one (1) share of common stock and one (1) warrant to purchase one (1) share of common stock at $1.50 US for a period of five (5) years. The Company will pay annual interest of 5% until the loan is repaid or converted into Units. The Company will issue 1,250,000 Units when the exercise provision is enacted. The line of credit was drawn to $500,000 as of June 30, 2012. Interest expense related to the line of credit was $ 4,680 as of June 30, 2012.  





F-8


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE, INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 9 – RELATED PARTY TRANSACTIONS


Beginning July 1, 2010, the Company entered into a consulting agreement with a director for $1,500 per month as compensation.


On November 7, 2011, the Company entered into an employment agreement with Barry Wattenberg, our president, chief executive officer, chief financial officer, secretary, treasurer and a member of our board of directors.  The employment agreement will become effective on December 1, 2011.


Pursuant to the terms of the employment agreement Mr. Wattenberg will receive a base salary of $10,000 per month, payments of which will accrue, and a key man life insurance policy of $1,000,000 payable half to the Company and half to Mr. Wattenberg’s estate. The Company shall also reimburse all reasonable and necessary business expenses incurred by Mr. Wattenberg in performance of his duties. When established, the company will compensate Mr. Wattenberg with group health insurance benefits and will allow for standard executive benefits such as vacation, holidays, sick leave and the granting of stock options when deemed appropriate by the Company.


The total amounts of $95,500 and $65,500 as of June 30 and March 31, 2012 have been recorded as deferred compensation.


NOTE 10 – CAPITAL STOCK


The company has 200,000,000 common shares authorized at a par value of $0.0001 per share.


During the period ended March 31, 2008, the Company issued 80,000,000 common shares at to founders for total proceeds of $8,000.  Additionally, the Company issued 67,200,000 shares during the period ended March 31, 2008 for total proceeds of $42,000.


On July 9, 2010, a former shareholder and director of the Company agreed to forgive debt in the amount of $14,244. This amount has been recorded as contributed capital.


Effective September 8, 2010 the Company increased the authorized shares of common stock from 100,000,000 to 200,000,000 and enacted a forward stock split of 80 to 1. All share and per share data has been adjusted to reflect such stock split.


In May 2011 the Company issued 150,000 common shares in lieu of compensation along with stock options.


On November 10, 2011, the Company issued 25,000 shares of common stock at a value of $0.0001 per share as compensation for a finder’s fee related to the Sodaville, Nevada property.


On December 31, 2011, the Company issued an aggregate of 190,000 restricted shares of our common stock at a value of $0.0001 per share to our directors, advisors and consultants to the Company.


On June 30, 2012, the Company issued 1,000,000 restricted shares of our common stock at a value of approximately $0.20 per share to Kim Diaz of BLM Claims located in Mineral County Nevada in connection with the acquisition of mineral properties. (See note 3 for further details)


The amount of stock compensation expense for the period ending June 30, 2012 was $149,055.


There were 148,665,000 shares of common stock issued and outstanding as of June 30, 2012. As June 30, 2012, the Company has no warrants outstanding. There are 1,270,000 stock options outstanding




F-9


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE, INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 10 – CAPITAL STOCK (CONTINUED)


Stock options


In April 2011, the Company issued 600,000 stock options to directors of the Company per the Stock Option Plan with an exercise price of $0.60 per share for a 5 year term. In May 2011, the Company entered into two consulting agreements which granted a total of 75,000 stock options per the Company’s Stock Option Plan. All these stock options are exercisable at $1.00 per share for a 5 year term. In December 2011, the Company granted a total of 115,000 stock options to advisors and consultants. All these stock options are exercisable at $1.00 per share for a 3 year term.


In April 2012, the Company issued 35,000 stock options to advisors and consultants of the Company per the Stock Option Plan with an exercise price of $1.00 per share for a 5 year term.


In May 2012, the Company issued 25,000 stock options to consultants of the Company per the Stock Option Plan with an exercise price of $1.00 per share for a 5 year term.


In June 2012, the Company issued 25,000 stock options to consultants of the Company per the Stock Option Plan with an exercise price of $1.00 per share for a 5 year term.


Stock option compensation expense for the period ending June 30, 2012 was $149,055. The expense was calculated using the Black-Scholes pricing model. The following table summarizes information about options as of June 30, 2012:


 

 

Number of Shares

 

Weighted Average Exercise Price

Outstanding, March  31, 2012

 

1,185,000

$

.84

          Options granted

 

85,000

 

1.00

          Options expired

 

-

 

-

          Options cancelled

 

-

 

-

      Outstanding, June 30, 2012

 

1,270,000

$

.85

      Exercisable, June 30, 2012

 

1,270,000

$

.85


The following table summarizes information about stock warrants granted to employees, advisors, investors and board members at June 30, 2012:


Stock Options Outstanding

 

Stock Options Exercisable

 

Range of Exercise Prices

 

Number Outstanding

 

Weighted Average Exercise Price

 

Weighted Average Remaining Contractual Life    (in years)

 

Number of Options

 

Weighted Average Exercise Price

 

 

 

 

 

 

 

 

 

 

 

 

$

.60 to 1.00

 

1,270,000

$

.85

 

3.77

 

1,270,000

$

0.85


As of June 30, 2012, the aggregate intrinsic value of the stock options outstanding and exercisable was $0.  The weighted-average grant-date fair value of stock options granted for the period ending June 30, 2012 was $0.85.  The total fair value of shares vested as of June 30, 2012 was 1,270,000 of stock options at fair market value on June 30, 2012.




F-10


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE, INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012

NOTE 11 – RESTATEMENT


The Company has recorded the cost of stock options granted in the 10K ending March 31, 2012. The Company is allocating the cost to the correct quarterly periods in the fiscal year ended March 31, 2012. The additional stock compensation expense in period ending June 30, 2011 was $142,065.


The following are the previous and corrected balances for the period ending June 30, 2011:


June 30, 2011 Financial Statement

Line Item

Corrected

Previously Stated

Balance Sheet

Prepaid expenses

         107,639

-

Balance Sheet

Additional paid in capital

        567,902

         210,559

Income Statement

Stock compensation

       303,115

         161,050

Income Statement

Net Loss

 (357,325)

 (215,260)


NOTE 12 – INCOME TAXES


The provision for Federal income tax consists of the following for the three months ended June 30, 2012 and 2011:


 

2012

2011

Federal income tax benefit attributable to:

 

 

Current operations

$   133,786

$  121,491

Less: valuation allowance

(133,786)

(121,491)

Net provision for Federal income taxes

$              -

$              -


The cumulative tax effect at the expected rate of 34% of significant items comprising our net deferred tax amount is as follows as of June 30, 2012 and March 31, 2012:


 

June 30, 2012

March 31, 2012

Deferred tax asset attributable to:

 

 

Net operating loss carryover

$   657,086

$   523,300

Less: valuation allowance

(657,086)

(523,300)

Net deferred tax asset

$                -

$                -


Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards of $1,932,605 for federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.


NOTE 13 – GOING CONCERN


Due to the uncertainty of our ability to meet our current operating and capital expenses, in their report on the annual financial statements for the year ended March 31, 2012, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern.


We anticipate that additional funding will be required in the form of debt or equity capital financing from the sale of our common stock.  At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through debt to meet our obligations over the next twelve months. We do not have any arrangements in place for any future debt or equity financing.  




F-11


POTASH AMERICA, INC.

(FORMERLY ADTOMIZE, INC.)

(AN EXPLORATION STAGE COMPANY)

NOTES TO THE FINANCIAL STATEMENTS

JUNE 30, 2012


NOTE 14 – SUBSEQUENT EVENTS


In accordance with ASC Topic 855-10, the Company has analyzed its operations subsequent to June 30, 2012 to the date these financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these financial statements.





F-12


Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations


FORWARD-LOOKING STATEMENTS


This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "could", "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.


Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable laws, including the securities laws of the United States, we do not intend to update any of the forward-looking statements so as to conform these statements to actual results.


Our unaudited financial statements are stated in U.S. dollars and are prepared in accordance with generally accepted accounting principles in the United States. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report.


In this quarterly report, unless otherwise specified, all dollar amounts are expressed in United States dollars. All references to "common shares" refer to the common shares in our capital stock.


As used in this quarterly report and unless otherwise indicated, the terms "we", "us", "our" and "our company" mean Potash America, Inc., a Nevada corporation, unless otherwise indicated.


General Overview


We were incorporated in the state of Nevada on July 31, 2007 as Adtomize Inc.  On June 29, 2010, we underwent a change of control. On September 8, 2010, we affected a split of our authorized capital and our issued and outstanding common shares on an 80 for 1 basis. On March 3, 2011 we changed our name to Potash America, Inc., and began looking for opportunities to acquire exploration stage mineral properties. We maintain our business offices at 200 South Virginia Street, 8th Floor, Reno, Nevada, 89501 and our telephone number is (775) 398-3019.


Before we went through a change of control and business focus, we engaged in the business of developing an online advertising brokerage service to bring together high traffic web site publishers with companies wishing to place ads on them in order to drive traffic to their own internet sites. Since our inception, we had been attempting to raise money to operate our business, but have not been able to secure the funds necessary to do so. The lack of funds and the present economy have prevented that from happening. As we have been unable to raise the capital necessary to develop and market our service, we began a search for other business opportunities which may benefit our shareholders and allow us to raise capital and operate.


Current Business


Shortly after changing our business focus to exploration stage properties, we identified an opportunity to acquire the Newfoundland Property from Habitants Minerals Ltd. We entered into a letter of intent on March 15, 2011 and subsequently a mining property acquisition agreement on June 6, 2011. We now plan to undertake further evaluation of the Newfoundland Property.




5


On March 15, 2011 we entered into a credit facility agreement. The lender agreed to provide us with a line of credit in the amount of up to $200,000 wherein, within three business days after receipt of notice from us, the lender will advance amounts requested to our company. On June 22, 2011, the credit facility agreement was amended to increase the size of the line of credit to a total of $1,000,000.  We shall use the advances to fund working capital and general corporate activities.  Pursuant to the terms of the credit facility agreement, our company shall pay any outstanding amounts to the lender on demand. We may also repay the loan and accrued interest at any time without penalty. Amounts outstanding shall bear interest at the rate of 5% per annum.


We entered into a letter of intent on March 15, 2011 with Habitants Minerals Ltd with respect to an acquisition of a property in Newfoundland, Canada.


On June 6, 2011 we entered into and closed a property acquisition agreement with Habitants.  Pursuant to the terms of the agreement, we acquired an undivided 100% interest in certain unpatented mining claims located in Western Newfoundland, Canada which we refer to as the “Newfoundland Property”. Pursuant to the terms of the agreement, we agreed to provide the following payments to Habitants:


The aggregate consideration of $50,000 consisting of the following:


-

$30,000 which was previously provided to Habitants, and

-

the balance of $20,000 which was provided on the closing of the agreement.


If any third party asserts any right or claim to the Newfoundland Property or to any amounts payable to Habitants, we may deposit any amounts otherwise due to Habitants in escrow with a suitable agent until the validity of such right or claim has been finally resolved.  If we deposit said amounts in escrow, we shall be deemed not in default under this agreement for failure to pay such amounts to Habitants.


On May 11, 2011 we entered into a letter of intent to acquire a 100% interest in 39 Bureau of Land Management claims in Mineral County, Nevada (the “BLM Claims”). Pursuant to the terms of the letter of intent our company advanced the following payments to the administrator of the claims, Ms. Kim Diaz:


(a)

$20,000.00, of which $5,000.00 was disbursed to Ms. Diaz, contemporaneously with the execution of the letter of intent; and

(b)

$5,000.00, upon the execution of the letter of intent, to enable Ms. Diaz and Elwayne E. Everett to commence the bentonite project on the adjacent property;


Under the terms of the letter of intent our company and Ms. Diaz would be required to enter into an option agreement on or before August 31, 2011.  Pursuant to the option agreement our company would be required advance $10,000 to Ms. Diaz to cover reimbursement on the 39 BLM Claims which would be deducted from the required payment of $210,000 to Ms. Diaz upon execution of the option agreement.


On August 31, 2011 we entered into a purchase and sale agreement related to the acquisition of the 100% interest in the BLM Claims. Under the terms of the purchase and sale agreement our company issued a pre-closing advance of $200,000 to Ms. Kim Diaz and Sonseeahray Diaz (the “Sellers”).


As additional consideration our company will pay compensation to the Sellers as follows:


(a)

$200,000 on November 31, 2011 (paid);

(b)

$50,000 on July 1, 2012; (paid on June 30, 2012)

(c)

$1,500,000, which will be paid in equal payments of $500,000 on or before January 1st of 2013, 2014 and 2015;

(d)

2,500,000 shares of our company’s common stock based on the Sellers’ pro-rata interest in the claims and a total of 500,000 shares to those parties designated by the Sellers on or before July 1st of 2012, 2013 and 2014 (1,000,000 shares were issued to the Sellers effective June 30, 2012);


We have also agreed to pay a royalty of $10 per short ton of product produced from the BLM Claims and sold by our company.  



6


Our company has also located 48 unpatented lode mining claims (the “Additional Claims”) in the area in which the BLM Claims are located. As part of the consideration our company will also pay the Sellers a royalty of $10 per short ton of product produced from the Additional Claims and sold by our company. In addition to granting the royalty in the Additional Claims our company will issue 50,000 shares of restricted stock to the Sellers on or before January 1, 2015.


Our company shall also reserve a net smelter returns royalty (the “NSR Royalty”) on certain metallic products produced from the BLM Claims equal to 2% of the net smelter returns. The NSR Royalty shall not apply to and no NSR Royalty payments shall be due for any product produced from the BLM Claims sold by our company.


Additionally, our company will pay the Sellers a guaranteed minimum annual royalty of $50,000 for a period of 5 years with the first payment due on December 31, 2015 and the last payment due on December 31, 2020.


On November 22, 2011, we entered a second credit facility agreement in which the lender agreed to provide our company with a line of credit in the amount of up to $500,000. Pursuant to the terms of the credit facility agreement, our company shall pay any outstanding amounts to the lender on demand. Our company may also repay the loan and accrued interest at any time without penalty. Amounts outstanding shall bear interest at the rate of 10% per annum.


Effective December 1, 2011 we entered into an employment agreement with our president, Barry Wattenberg, under which Mr. Wattenberg will receive a base salary of $10,000 per month, payments of which will accrue, and a key man life insurance policy of $1,000,000 payable half to our company and half to Mr. Wattenberg’s estate.


Purchase of Significant Equipment


We do not intend to purchase any significant equipment over the next twelve months.


Off-Balance Sheet Arrangements


We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.


Employees


We do not expect any material changes in the number of employees over the next 12 month period (although we may enter into employment or consulting agreements with our officers or directors). We do and will continue to outsource contract employment as needed.  


Results of Operations


The following unaudited summary of our results of operations should be read in conjunction with our financial statements for the three month periods ended June 30, 2012 and 2011.


We have not generated any revenue since inception and are dependent upon obtaining financing to pursue our business activities. For these reasons, our auditors believe that there is substantial doubt that we will be able to continue as a going concern.


Results of Operations for the Three Months Ended June 30, 2012 and 2011


Our operating results for the three month periods ended June 30, 2012 and 2011 and the changes between those periods for the respective items are summarized as follows:




7





  

  

Three Month 
Period Ended 
June 30,
2012

  

  

Three Month 
Period Ended 
June 30,
2011

  

  

Change Between
Three Month 
Periods Ended
June 30, 2012 and June 30, 2011

  

Revenue

$

Nil

  

$

Nil

  

$

Nil

  

Professional fees

$

55,409

  

$

14,759

  

$

40,650

  

Transfer agent and filing fees

$

1,372

  

$

1,948

  

$

(576

Consulting fees

$

41,715

  

$

11,700

  

$

30,015

  

Web development

$

1,175

  

$

10,545

  

$

(9,370

Stock compensation

$

149,055

  

$

303,115

  

$

(154,060

Exploration costs

$

106,183

  

$

Nil

  

$

106,183

  

General and administrative

$

16,269

  

$

14,125

  

$

2,144

  

Interest Expense

$

22,301

  

$

1,133

  

$

21,168

  

Net loss

$

(393,488

)

$

(357,325

)

$

36,163

  


Our expenses increased during the three month period ended June 30, 2012 compared to the same period in 2011 primarily as a result of increases in professional fees, consulting fees, exploration costs, general and administrative expenses and interest expenses.


Liquidity and Financial Condition


Working Capital


  

 

At
June 30, 2012
$

 

 

At
March 31, 2012
$

 

 

Change Between
March 31, 2012 and June 30, 2012
$

 

Current Assets

 

$

349,638

 

 

$

251,381

 

 

$

98,257

 

Current Liabilities

 

$

1,517,779

 

 

$

1,165,088

 

 

$

352,691

 

Working Capital / (Deficit)

 

$

(1,168,141

)

 

$

(913,707

)

 

$

(254,434

)


Cash Flows


  

 

Three Months Ended 
June 30, 2012
$

 

 

Three Months Ended
June 30, 2011
$

 

 

Period from Inception
(July 31, 2007) to
June 30, 2012
$

 

Cash Flows from Operating Activities

 

$

(200,779

)

 

$

(58,544

)

 

$

(745,555

)

Cash Flows provided by/(used in) Investing Activities

 

$

Nil

 

 

$

50,000

 

 

$

(515,645

)

Cash Flows from Financing Activities

 

$

290,000

 

 

$

115,000

 

 

$

1,419,744

 

Net Increase (Decrease) in Cash During Period

 

$

89,221

 

 

$

6,456

 

 

$

158,544

 


As of June 30, 2012, our total current assets were $349,638 and our total liabilities were $1,517,779 and we had a working capital deficit of $1,168,141. Our unaudited financial statements report a net loss of $393,488 for the three months ended June 30, 2012 compared to a net loss of $357,325 for the same period in 2011 and a net loss of $1,932,605 for the period from July 31, 2007 (inception) to June 30, 2012.




8


Going Concern


Due to the uncertainty of our ability to meet our current operating and capital expenses, in their report on the annual financial statements for the year ended March 31, 2012, our independent auditors included an explanatory paragraph regarding concerns about our ability to continue as a going concern.


We anticipate that additional funding will be required in the form of debt or equity capital financing from the sale of our common stock.  At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through debt to meet our obligations over the next twelve months. We do not have any arrangements in place for any future debt or equity financing.  


Critical Accounting Policies


The discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with the accounting principles generally accepted in the United States of America.  Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses.  These estimates and assumptions are affected by management’s application of accounting policies.  We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financial statements.


We regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. In general, management's estimates are based on historical experience, on information from third party professionals, and on various other assumptions that are believed to be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.


Exploration Stage Company


The accompanying financial statements have been prepared in accordance with generally accepted accounting principles related to accounting and reporting by exploration stage companies.  An exploration stage company is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from.


Basis of Presentation


The accompanying interim unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information. Accordingly, they do not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations, stockholders’ deficit or cash flows. It is management's opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.  The interim unaudited financial statements should be read in conjunction with our company’s Annual Report on Form 10-K, which contains the annual audited financial statements and notes thereto, together with the Management’s Discussion and Analysis, for the year ended March 31, 2012. The interim results for the period ended June 30, 2012 are not necessarily indicative of the results for the full fiscal year.  The interim unaudited financial statements are presented in USD.  


Accounting Basis


Our company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“GAAP” accounting).  Our company has adopted a March 31 fiscal year end.


Financial Instruments


Our company's financial instrument consists of cash, prepaid expenses, deposits, accrued expenses, deferred compensation, amounts due to stockholders and a line of credit.



9


The amounts due to stockholders are non-interest bearing.  It is management's opinion that our company is not exposed to significant interest, currency or credit risks arising from its other financial instruments and that their fair values approximate their carrying values except where separately disclosed.


Cash and Cash Equivalents


Our company considers all highly liquid investments with maturities of three months or less to be cash equivalents.  At June 30, 2012 and March 31, 2012, respectively, our company had $158,544 and $69,323 of cash.


Mineral Rights, Property and Acquisition Costs


Since March 31, 2011, our company is primarily engaged in the acquisition and exploration of mining properties. Our company has not yet realized any revenues from its planned operations.


Our company capitalizes acquisition and option costs of mineral rights as tangible assets. Upon commencement of commercial production, the mineral rights will be amortized using the unit-of-production method over the life of the mineral rights. If our company does not continue with exploration after the completion of the feasibility study, the mineral rights will be expensed at that time.


The costs of acquiring mining properties are capitalized upon acquisition.  Mine development costs incurred to develop and expand the capacity of mines, or to develop mine areas in advance of production are also capitalized once proven and probable reserves exist and the property is a commercially mineable property. Costs incurred to maintain current exploration or to maintain assets on a standby basis are charged to operations.  Costs of abandoned projects are charged to operations upon abandonment.  Our company evaluates the carrying value of capitalized mining costs and related property and equipment costs, to determine if these costs are in excess of their recoverable amount whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable.  Evaluation of the carrying value of capitalized costs and any related property and equipment costs are based upon expected future cash flows and/or estimated salvage value in accordance with Accounting Standards Codification (ASC) 360-10-35-15, Impairment or Disposal of Long-Lived Assets.


Impairment of Long-Lived Assets


Our company reviews and evaluates long-lived assets for impairment when events or changes in circumstances indicate the related carrying amounts may not be recoverable. The assets are subject to impairment consideration under ASC 360-10-35-17, Measurement of an Impairment Loss, if events or circumstances indicate that their carrying amount might not be recoverable.  As of June 30, 2012, exploration progress is on target with our company’s exploration and evaluation plan and no events or circumstances have happened to indicate that the related carrying values of the properties may not be recoverable. When our company determines that an impairment analysis should be done, the analysis will be performed using the rules of FASB ASC 930-360-35, Asset Impairment, and 360-10-15-3 through 15-5, Impairment or Disposal of Long-Lived Assets.


Advertising


Our company expenses advertising costs as incurred.  Our company has had no advertising activity since inception.


Revenue Recognition


Our company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.


Use of Estimates


The preparation of financial statements in conformity with generally accepted accounting principles of the United States 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 year. The more significant areas requiring the use of estimates include



10


asset impairment, stock-based compensation, and future income tax amounts. Management bases its estimates on historical experience and on other assumptions considered to be reasonable under the circumstances. However, actual results may differ from the estimates.


Basic Income (Loss) Per Share


Basic income (loss) per share is calculated by dividing our company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing our company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There are no such common stock equivalents outstanding as of June 30, 2012.


During the year ended March 31, 2011, our company enacted an 80 to 1 forward stock split. All share and per share data has been adjusted to reflect such stock split.


Stock-Based Compensation


Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718.  On March 31, 2011, our company instituted a Stock Option Plan which allows for the issuance of 3,000,000 shares of common stock to our company’s management, employees and consultants. As of June 30, 2012, our company issued 148,665,000 common stock shares and has issued 1,270,000 in stock options in lieu of compensation.


Income Taxes


Income taxes are computed using the asset and liability method.  Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws.  A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.


Recent Accounting Pronouncements


Our company does not expect the adoption of recently issued accounting pronouncements to have a significant impact on our company’s results of operations, financial position or cash flow.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk


As a “smaller reporting company”, we are not required to provide tabular disclosure obligations.


Item 4.  Controls and Procedures


Management’s Report on Disclosure Controls and Procedures


We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer and our principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.


As of the end of our quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer and our principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer and our principal financial officer and principle



11


accounting officer) concluded that our disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.


Changes in Internal Control over Financial Reporting


During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


PART II – OTHER INFORMATION


Item 1.  Legal Proceedings


We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.


Item 1A.  Risk Factors


As a “smaller reporting company”, we are not required to provide the information required by this Item.


Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds


On June 30, 2012, we issued an aggregate of 1,000,000 restricted shares of our common stock at a value of approximately $0.20 per share in connection with the acquisition of the BLM Claims located in Mineral County Nevada. These shares were issued pursuant to an exemption from registration relying on Section 4(2) of the Securities Act of 1933.


Item 3.  Defaults Upon Senior Securities


None.


Item 4.  Mining Safety Disclosure


Not Applicable.


Item 5.  Other Information


None.


Item 6.  Exhibits


Exhibit No.

Description

(3)

Articles of Incorporation and Bylaws

3.1

Articles of Incorporation (incorporated by reference to our Registration Statement on Form S-1 filed on May 9, 2008)

3.2

Certificate of Amendment (incorporated by reference to our Current Report on Form 8-K filed on September 10, 2010).




12





Exhibit No.

Description

3.3.

Certificate of Amendment (incorporated by reference to our Current Report on Form 8-K filed on March 7, 2011)

(10)

Material Contracts

10.1

Credit Facility Agreement dated March 2011 (incorporated by reference to our Current Report on Form 8-K filed on March 17, 2011)

10.2

2011 Stock Option Plan (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.3

Form of Stock Option Agreement (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.4

Director’s Association Agreement between our company and Alan B. Brass (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.5

Director’s Association Agreement between our company and Norman Marcus (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.6

Stock Option Agreement between our company and Alan B. Brass (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.7

Stock Option Agreement between our company and Norman Marcus (incorporated by reference to our Current Report on Form 8-K filed on April 26, 2011)

10.8

Property Acquisition Agreement dated June 6, 2011 between our company and Habitants Minerals Ltd. (incorporated by reference to our Current Report on Form 8-K filed on June 17, 2011)

10.9

Purchase and Sale Agreement dated August 31, 2011 between our company and Kim Diaz and Sonseeahray Diaz (incorporated by reference to our Current Report on Form 8-K filed on September 12, 2011)

(14)

Code of Ethics

14.1

Code of Business Conduct and Ethics (incorporated by reference to our Current Report on Form 8-K filed on June 17, 2011)

(31)

Rule 13a-14(a)/15d-14(a) Certifications

31.1*

Section 302 Certification under the Sarbanes-Oxley Act of 2002 of Barry Wattenberg (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

(32)

Section 1350 Certifications

32.1*

Section 302 Certification under the Sarbanes-Oxley Act of 2002 of Barry Wattenberg (Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

101**

Interactive Data File

101.INS

101.SCH

101.CAL

101.DEF

101.LAB

101.PRE

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

XBRL Taxonomy Extension Label Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document


*

Filed herewith.


**

Furnished herewith. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files in Exhibit 101hereto are deemed not filed or part of any registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed not filed for purposes of Section 18 of Securities and Exchange Act of 1934, and otherwise are not subject to liability under those sections.

 

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.

  

POTASH AMERICA, INC.

  

(Registrant)

  

 

  

 

 Dated:  August 20, 2012

/s/ Barry Wattenberg

 

Barry Wattenberg

  

President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer and Director

  

(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

 




14


PINX:PTAM Potash America Inc Quarterly Report 10-Q Filling

Potash America Inc PINX:PTAM Stock - Get Quarterly Report SEC Filing of Potash America Inc PINX:PTAM stocks, including company profile, shares outstanding, strategy, business segments, operations, officers, consolidated financial statements, financial notes and ownership information.

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PINX:PTAM Potash America Inc Quarterly Report 10-Q Filing - 6/30/2012
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