SEC Company Response from ADM ENDEAVORS, (ADMQ) — Jul 8, 2019
ADM ENDEAVORS, INC.
Date: July 8, 2019 · CIK: 0001588014 · Accession: 0001493152-19-010350
AI Filing Summary & Sentiment
File numbers found in text: 000-56047
Letter
Via Edgar Only Division of Corporation Finance RE: ADM Endeavors, Inc. Form 10-12G/A - Amendment No. 1 Filed June 21, 2019 File No. 000-56047
Dear Ms. McHale:
ADM Endeavors, Inc. (the “Company”) provides the following response (the “Response Letter”) to the comments contained in the letter (the “Comment Letter”) of the staff of the Division of Corporation Finance (the “Staff”) of the U.S. Securities and Exchange Commission (the “Commission”) dated July 2, 2019, relating to the above-referenced filing.
In response to the following enumerated comments in the Comment Letter, we respectfully submit the following responses:
Form 10-12G/A Filed June 21, 2019
Critical Accounting Policies and Estimates
Derivative Instruments, page 9
1.
We have read your response to prior comment 6. Please further expand your disclosure to include the maturity date of the liability and the interest rate on the loan. Financial Statements, page F-1
Response: We have modified in the Financial Statements for the period ended December 31, 2019 for Derivative Instruments as follows:
Derivative Instruments
The conversion features embedded in the convertible notes were evaluated to determine if such conversion feature should be bifurcated from its host instrument and accounted for as a freestanding derivative. In the convertible notes with variable conversion terms, the conversion feature was accounted for as a derivative liability. The derivatives associated with the term convertible notes wert recognized as a discount to the debt instrument and the discount is amortized over the expected life of the notes with any excess of the derivative value over the note payable value recognized as additional interest expense at the issuance date.
The derivative liability was calculated using the Black-Scholes method over the expected terms of the convertible debt, with a risk-free rate of 2.45% and volatility of 100% as of December 31, 2018.
The note is convertible into common stock at a price of 35% of the lowest three trading prices during the ten days prior to conversion.
The convertible note originally matured in March 2019 and was extended to March 2020. The note had fees of approximately $53,000 which were amortized through March 2019 resulting in an effective interest rate of approximately 50%.
ADM Endeavors, Inc.
N. 3rd Street Bismarck, N.D. 58501 * (701) 224-9338
2.
Please update your financial statements for the interim period ended March 31, 2019 in accordance with Rule 8-08 of Regulation S-X.
Response: We have included the interim period ended March 31, 2019, as requested.
Thank you for your assistance and review.
Sincerely,
/s/
Ardell Mees
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ADM
Endeavors, Inc.
2021
N. 3rd Street Bismarck, N.D. 58501 * (701) 224-9338
July
8, 2019
Via
Edgar Only
Kate
McHale
Staff
Attorney
Division
of Corporation Finance
U.S.
Securities & Exchange Commission
Washington,
D.C. 20549
RE:
ADM
Endeavors, Inc.
Form
10-12G/A - Amendment No. 1
Filed
June 21, 2019
File
No. 000-56047
Dear
Ms. McHale:
ADM
Endeavors, Inc. (the “Company”) provides the following response (the “Response Letter”) to the comments
contained in the letter (the “Comment Letter”) of the staff of the Division of Corporation Finance (the “Staff”)
of the U.S. Securities and Exchange Commission (the “Commission”) dated July 2, 2019, relating to the above-referenced
filing.
In
response to the following enumerated comments in the Comment Letter, we respectfully submit the following responses:
Form
10-12G/A Filed June 21, 2019
Critical
Accounting Policies and Estimates
Derivative
Instruments, page 9
1.
We
have read your response to prior comment 6. Please further expand your disclosure to include the maturity date of the liability
and the interest rate on the loan. Financial Statements, page F-1
Response:
We have modified in the Financial Statements for the period ended December 31, 2019 for Derivative Instruments as follows:
Derivative
Instruments
The
conversion features embedded in the convertible notes were evaluated to determine if such conversion feature should be bifurcated
from its host instrument and accounted for as a freestanding derivative. In the convertible notes with variable conversion terms,
the conversion feature was accounted for as a derivative liability. The derivatives associated with the term convertible notes
wert recognized as a discount to the debt instrument and the discount is amortized over the expected life of the notes with any
excess of the derivative value over the note payable value recognized as additional interest expense at the issuance date.
The
derivative liability was calculated using the Black-Scholes method over the expected terms of the convertible debt, with a risk-free
rate of 2.45% and volatility of 100% as of December 31, 2018.
The
note is convertible into common stock at a price of 35% of the lowest three trading prices during the ten days prior to conversion.
The convertible note originally
matured in March 2019 and was extended to March 2020. The note had fees of approximately $53,000 which were amortized
through March 2019 resulting in an effective interest rate of approximately 50%.
ADM
Endeavors, Inc.
2021
N. 3rd Street Bismarck, N.D. 58501 * (701) 224-9338
2.
Please
update your financial statements for the interim period ended March 31, 2019 in accordance with Rule 8-08 of Regulation S-X.
Response:
We have included the interim period ended March 31, 2019, as requested.
Thank
you for your assistance and review.
Sincerely,
/s/
Ardell Mees
Ardell
Mees
Chief
Executive Officer