TREES Corp (Colorado) - Annual Report: 2011 (Form 10-K)

U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

For the transition period from _________to _________

Commission File Number 333-163342

Promap Corporation

(Exact name of registrant as specified in its charter)

6855 South Havana Street, Suite 400, Centennial, CO		80112
(Address of principal executive offices)		(Zip Code)

Registrant's Telephone Number, including area code: (720) 889-0510

Securities Registered pursuant to Section 12(b) of the Act:  None

Securities Registered pursuant to Section 12(g) of the Act:  None

Indicate by check mark if 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 (i) 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 checkmark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). [  ] Yes [  ] No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [  ]

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

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

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

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter:  $318,550.

Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. As of March 15, 2012 the registrant had 9,724,200 shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None.

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PROMAP CORPORATION

FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2010

TABLE OF CONTENTS

PART I

 

PART II

PART III

PART IV

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PART I

Item 1.  Business.

The Company

General Information

Promap Corporation was incorporated in the State of Colorado on November 12, 1987. We are an independent GIS and custom draft energy mapping company for the oil and gas industry in the United States and Canada.  We provide hard copy and digital format oil and gas production maps which cover various geologic basins in numerous areas including:  Denver Basin, Powder River Basin, Michigan Basin, Williston Basin, Arkoma Basin, Illinois Basin, Cincinnati Arch, Uintah - Piceance Basins and The Nevada Basin.  We also provide maps of the North American Coal Basin and Coal Bed Methane Activity and North American Devonian - Mississippian Shale Map with detailed pipeline locations.

These maps provide a quick reference to determining what reservoir existing wells produce from, where present activity is and where the location of the existing fields are in relation to the activity in a particular state or geologic basin.  We acquire most of the data used in our maps from public sources such as BLM and various state oil and gas commissions, state geological surveys, the Department of Natural Resources and the U.S. Geological Survey (the “USGS”).

Our maps, which are color coded by pay zone, are unique in that unlike competing products, they are not limited to a particular state and instead are defined by a geologic basin.  The maps are priced to be competitive and to be of interest to a wide variety of industry and non-industry professionals.  We currently have maps covering eleven different oil and gas basins, but we intend to prepare maps for several new areas which are of interest to the oil and gas industry.  These maps are generally updated bi-annually to include any new activity or developments in each specific area.  

We also provide custom mapping services to a variety of oil and gas companies by providing custom maps to our client’s specifications, integrating data into either hardcopy or digital form.  Client specifications are compiled, analyzed, documented and assembled into digital form and then printed to the client’s requirements for size, quantity and quality.  We can also access resources in cartography, geography, surveying and GPS disciplines for a more comprehensive approach to achieve total client satisfaction.

Industry Overview

The oil and gas production mapping sector is a highly competitive niche business that is essential to energy producers and exploration companies. Accuracy of mapping data is of critical importance in oil and gas exploration and production efforts. The risk and costs involved in

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establishing where to explore in a particular basin, or where to acquire new assets, are simply too high to leave to inaccurate information. When so much economic risk is at stake, it is obviously important to have precise, up-to-date production data.  

Process of Making Maps

The first step in making a new map is creating the land grid and location of the existing oil and gas fields.  This is sometimes the largest cost component because either the land grid has to be purchased or it is digitized from the USGS topographical maps.  Then the oil and gas fields are digitized onto the maps.  A map can take a GIS technician anywhere from 60 to 90 days to create.  Next you add the stratigraphic column, cultural information, specific terrain features and pipelines to the map.  The final step is actually printing the maps as they are needed.  All of our basic maps have been prepared in digital form, and from there we sometimes add additional features requested by the client or we can just print out the map as it is.  We also expect to prepare new maps if and when they are requested by clients.

Revenue Strategy

The petroleum business is continually expanding as the high dependence of most modern industrial transport, agricultural, and industrial infrastructures rely on the relatively low cost and high availability of oil and natural gas. The possibility of production declines and probable increases in the price of oil are expected to have negative implications for the global economy unless additional hydrocarbons are discovered and current field extraction is maximized.  As more exploration companies endeavor to extract maximum hydrocarbons they will need access to detailed, up-to-date mapping products in order to be competitive in terms of leasing in new areas, divesting, acquiring or just maintaining their existing assets.  There are numerous new areas being developed that will require the production of new maps as well as constant updating of existing ones.  Frequently, the first step an exploration or development company, drilling contractor, investor group, or independent consultant takes is to identify the regional area of interest. Our maps are an excellent tool for evaluating potential exploration sites covering large geographic areas. Field locations, general subsurface structure and geologic age of productive reservoirs are depicted on one type of our most popular multicolor map. Most of our maps are available in digital format and can be customized for individual needs. Our revenue growth strategy involves expanding the range of geographic information systems services offerings, and increasing our penetration into the oil and gas production mapping market.  The addition of new geographical information systems services is highly dependent on our ability to acquire additional hardware and software applications to become a state of the art mapping facility.

Management and Employees

At this time we have no full time employees and Mr. Tedesco is a part-time employee. We have traditionally contracted with employees of affiliated companies to perform the services necessary to produce the maps.

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We will continue to hire part-time help as needed from time-to-time for specific projects. We do not pay salaries to our officers. However, we reimburse them for any out-of-pocket expenses they incur on our behalf. In addition, in the future, we may approve the payment of salaries for our management, but currently, no such plans have been approved. We do not currently pay for vacation, holidays or provide major medical coverage. None of our officers or directors is a party to any employment agreement. However, we may adopt such plans in the future.

Customers

Our customers have traditionally been small to mid-size oil and gas companies in the US and Canada, to which we provide a low-cost, high quality graphic solution.  Thus far all of our customers have been companies that have some affiliation with us, but we intend to market our maps to other companies of the same size.  These companies typically do not have the resources to establish a GIS or graphics staff.  In the future we intend to market our maps to companies in other industries such as the financial sector, which would use our maps for due diligence and asset evaluation purposes.  In 2010 and 2011, our largest customer, Running Foxes Petroleum, accounted for approximately 98% of our sales.  Running Foxes Petroleum is an affiliated company which pays market prices for all of our products including custom mapping designs. Steve Tedesco, our President and his wife own 100% of Running Foxes Petroleum, and Steve serves as its President.  

Running Foxes Petroleum has been active over the last two years in oil and gas exploration and it often uses independent drilling partners when it drills wells. Running Foxes and its partners require mapping services on an ongoing basis as development of projects are advanced.  The Company provides critical services to Running Foxes and its partners on an as needed basis and by doing so reduces the overall administrative expenses of the parties.  Sales to these parties in 2009 and 2010 were the result of multiple small to medium size orders placed throughout the two year period.  All of the billing on the projects in which Running Foxes is involved is sent to Running Foxes, which may in turn bill its partners for some of the costs.

All services provided by us to related and affiliated parties are non-contractual and the prices are agreed to in advance by the parties.  Rates are periodically matched by the affiliates with third party rates and are determined to be comparable.  Orders placed with us may not be cancelled after commencement of mapping services unless the purchaser remits full payment for any partially completed documents.

We plan to continue with these transactions since no contractual obligations exist and each affiliate is free to use the services of any provider in the marketplace.  The decision of these affiliates to reduce or terminate the amount of business that they provide the Company would adversely affect the Company.

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Marketing

We have not engaged in any marketing activities over the last several years.  In prior years we had engaged in a direct mail marketing promotion to oil and gas industry participants.  During the current year, we plan to consider hiring a Sales Manager who will cover a designated sales region.  He will start marketing our maps to oil and gas professionals and others who might have a use for our maps.  He will report to the Company’s President and be responsible for developing and implementing a sales program which meets our specific targets. To assist him in developing his target region, we intend on developing an extensive database of potential customers, which includes oil and gas professionals, petroleum engineers, educational and financial institutions. We will engage in direct-sale marketing efforts, whereby we will require our Sales Manager to establish relationships with our target customers in order to demonstrate the capabilities and advantages of Promap products. We also anticipate a comprehensive email campaign and mass mailing program.  The directors and officers of the Company have extensive personal and business contacts within the industry, and we believe that this approach, combined with word of mouth advertising will significantly increase our business.

Patents and Trademarks:

We do not currently have any patents or trademarks outstanding.

Competition

The oil and gas mapping business is very competitive.  The market for oil and gas maps is served by a number of companies such as Geomap Company, the largest supplier of geologic mapping services in the United States, and HIS Inc., a global company listed on the NYSE which provides extensive critical information to its customers in a number of industries including energy, and a number of smaller companies.  Most of the large oil and gas companies have their own in-house mapping departments.

As noted in “RISK FACTORS,” many or all of these competitors have greater financial and other resources than we have. Most of these companies are focused on the larger customers. We plan to focus our energy on the smaller accounts and believe this space will provide the necessary client base and revenues to make our business profitable.

We intend to compete by providing to the smaller oil and gas companies and other customers a low-cost, high quality graphic solution that meets their specific needs.

Government and Industry Regulation

We are not subject to any material government or industry regulation.

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Item 1A.   Risk Factors.

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

Item 1B.  Unresolved Staff Comments.

None.

Item 2.    Properties.

Our offices are located at 6855 South Havana Street, Suite 400, Centennial, Colorado 80112.  We rent our space from our President and major shareholder, Steven Tedesco, under a verbal month-to-month lease for which we pay no rent.

Item 3.    Legal Proceedings.

None.

Item 4.    Mine Safety Disclosures.

None.

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PART II

Item 5.

  Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Price Ranges of Common Stock

Our stock has not yet commenced trading.

Aggregate Number of Holders of Common Stock

The approximate number of record holders of our common stock on March 15, 2012 was approximately 42.  

Dividends

Holders of our common stock are entitled to receive dividends as may be declared from time to time by our Board of Directors. We have not paid any cash dividends on our common stock and do not anticipate paying any in the foreseeable future. Management's current policy is to retain earnings, if any, for use in our operations and for expansion of the business.

Use of Proceeds

We received a total of $56,050 in gross proceeds from the sale of 224,200 shares of common stock in our initial public offering which was closed on January 21, 2011.  The effective date of the registration statement for our initial public offering was June 25, 2010, and the SEC file number was 333-163342.  The offering terminated on January 21, 2011, which was the end of the offering period, and 575,800 shares which were registered for sale by the Company were not sold.

From the effective date of the registration statement (June 25, 2010) through March 15, 2011 we incurred and paid approximately $12,239 in expenses in connection with the offering.  There were no payments made to officers or directors of the Company or to affiliates of the Company.  The net offering proceeds after deducting the above expenses was $43,811.  From the period of the closing date through December 31, 2011, the $43,811 was used as follows:  

	Legal and accounting fees related to SEC reporting		$18,680
	Costs associated with getting stock listed on OTCBB		20,000
	Transfer Agent		1,300
	Miscellaneous administrative expenses		3,831

No payments were made to officers and directors of the Company.

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The registration statement also registered 1,500,000 shares of common stock to be offered by selling shareholders.  The selling shareholders have not offered any of their shares for sale and they will not do so until the Company has filed a post-effective amendment to the registration statement.

Securities Authorized for Issuance under Equity Compensation Plans

None.

Equity Compensation Plan Information

We do not have any compensation plans or stock option plans.

Recent Sales of Unregistered Securities

We did not have any sales of unregistered securities during the last three months of year ended December 31, 2011.

Item 6.    Selected Financial Data.

This item is not required for Smaller Reporting Companies.

Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the Financial Statements and Notes to Financial Statements filed herein.

Business Overview

Promap Corporation was incorporated in the State of Colorado on November 12, 1987. We are an independent GIS and custom draft energy mapping company for the oil and gas industry in the United States and Canada.  We provide hard copy and digital format oil and gas production maps which cover various geologic basins in numerous areas including:  Denver Basin, Powder River Basin, Michigan Basin, Williston Basin, Arkoma Basin, Illinois Basin, Cincinnati Arch, Uintah - Piceance Basins and The Nevada Basin.  We also provide maps of the North American Coal Basin and Coal Bed Methane Activity and North American Devonian - Mississippian Shale Map with detailed pipeline locations.

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Results of Operations for the year ended December 31, 2011 as compared to the year ended December 31, 2010

Revenues for the year ended December 31, 2011 were $61,562 as compared to the revenues of $100,642 for the year ended December 31, 2010.  The revenues decreased 39% primarily due to the reduction in oil and gas drilling activity of the Company’s primary customers.

The Company had a bad debt expense of $38,958 for the year ended December 31, 2011 as compared to $53,537 for the year ended December 31, 2010.  Most of the Company’s receivables were from related parties and management expects most of them to be paid during 2012.  In late March 2012, the Company received a payment from Running Foxes Petroleum for over $37,000 of receivables.

The general and administrative expenses were $51,467 for the year ended December 31, 2011 as compared to $18,344 for the prior year.  The 180% increase was primarily due to an increase in legal and accounting expenses related to preparing and filing periodic reports with the SEC and for getting the Company’s stock listed on the OTC Bulletin Board.

The net loss for the year ended December 31, 2011 was $58,683 as compared to a new loss of $726 for the prior year.  The reason for the larger loss was the reduction in the amount of sales and the increase in general and administrative expenses.

Results of Operations for the year ended December 31, 2010 as compared to the year ended December 31, 2009.

 

Revenues for the year ended December 31, 2010 were $100,642 as compared to the revenues of $38,003 for the year ended December 31, 2009.  This $62,639 increase in revenues in the year ended December 31, 2010 was due to an increase in new oil and gas drilling activity during the latest one year period.

The cost of goods sold for the year ended December 31, 2010 was $28,191 as compared to $7,436 for the year ended December 31, 2009.  This increase in cost of goods sold was due to the increase in sales in the year ended December 31, 2010.

The Company had a bad debt expense for the year ended December 31, 2010 in the amount of $53,537 and no such expense in the previous year.  All of the Company's sales were to related parties and this amount represents receivables that had not been paid by the time of the audit.  Management believes that most if not all of these receivables will be paid by the second quarter of 2011.

The general and administrative expenses were $18,344 in the year ended December 31, 2010 as compared to $63,311 for the year ended December 31, 2009.  The amount for 2010 was approximately in line with historical expenses whereas the amount for 2009 was unusually high because of the timing of when certain charges were booked in 2009.

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The net loss for the year ended December 31, 2010 was $726 as compared to a net loss of $32,405 for the year ended December 31, 2009.  The reason for the improvement from a loss of $32,405 to a loss of $726 was the improvement in sales during the most recent year and a drop in general and administrative expenses.

We plan to make every effort to keep operating expenses relatively constant except for the addition of one full or part-time salesmen.  If and when he is able to increase sales, we will increase the amount of time he works.  If his efforts are unsuccessful or if the oil and gas drilling activity slows down significantly, we will cut expenses as much as possible and wait out the downturn.  If we are able to increase sales significantly we may decide to raise additional financing to help finance the growth. We cannot assure that additional financing will be available when needed on favorable terms, or at all.

We cannot guarantee that we will be successful in generating sufficient revenues or other funds in the future to cover our operating costs. Failure to generate sufficient revenues or additional financing when needed could cause us to go out of business.

Liquidity and Capital Resources

As of December 31, 2011, we had $34,822 of working capital compared to $37,455 of working capital as of December 31, 2010.

Net cash used for operating activities was $42,460 during the year ended December 31, 2011 as compared to net cash used for operating activities of $12,770 during the year ended December 31, 2010.

There was no cash flow provided by or used for investing activities during the year ended December 31, 2011, or the year ended December 31, 2010.

There was $56,050 cash flow provided by financing activities during the year ended December 31, 2011, compared to no cash provided by financing activities in the year ended December 31, 2010.  The $56,050 represents the proceeds from the Company’s initial public offering.

We believe that the proceeds from our recent initial public offering will provide sufficient capital in the short term for our current level of operations. This is because we believe that we can generate sufficient sales and services within our present organizational structure and resources to become profitable in our operations. Additional resources will be needed to increase our sales staff and to otherwise increase advertising and marketing.

Otherwise, we do not anticipate needing to raise additional capital resources in the next twelve months.

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Our principle source of liquidity will be our operations. We expect variation in revenues to account for the difference between a profit and a loss. Our business activity is closely tied to the oil and gas business. A slow down in the oil and gas business would have a negative impact to our business. In any case, we try to operate with minimal overhead. Our primary activity will be to seek to find new customers.  If we succeed in expanding our client base and generating sufficient sales, we will become profitable. We cannot guarantee that this will ever occur. Our plan is to build our Company in any manner which will be successful.

Off-Balance Sheet Arrangements

We do not have any 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 is material to investors.

Critical Accounting Policies and 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 disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

Revenue is recognized on an accrual basis as earned under contract terms. Specifically, revenue from product sales is recognized subsequent to a customer ordering a product at an agreed upon price, delivery has occurred, and collectability is reasonably assured.

Item 7A.   Quantitative and Qualitative Disclosures about Market Risk.

Not applicable for smaller reporting companies.

Item 8.    Financial Statements and Supplementary Data.

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PROMAP CORPORATION

Financial Statements

TABLE OF CONTENTS

14

RONALD R. CHADWICK, P.C.

Certified Public Accountant

2851 South Parker Road, Suite 720

Aurora, Colorado  80014

Telephone (303)306-1967

Fax (303)306-1944

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors

Promap Corporation

Centennial, Colorado

I have audited the accompanying balance sheets of Promap Corporation as of December 31, 2010 and 2011, and the related statements of operations, stockholders' equity and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all material  respects, the financial position of Promap Corporation as of December 31, 2010 and 2011, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the financial statements the Company has suffered losses from operations and has limited working capital that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Aurora, Colorado

Ronald R. Chadwick, P.C.

March 9, 2012

    

RONALD R. CHADWICK, P.C.

F-1

The accompanying notes are an integral part of the financial statements.

F-2

The accompanying notes are an integral part of the financial statements.

F-3

The accompanying notes are an integral part of the financial statements.

F-4

The accompanying notes are an integral part of the financial statements.

F-5

PROMAP CORPORATION

NOTES TO FINANCIAL STATEMENTS

December 31, 2010 and 2011

NOTE 1.  ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Promap Corporation (the “Company”), was incorporated in the State of Colorado on November 12, 1987. The Company sells oil and gas maps to oil and gas industry businesses.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less as cash equivalents.

Accounts receivable

The Company reviews accounts receivable periodically for collectability and establishes an allowance for doubtful accounts and records bad debt expense when deemed necessary. At December 31, 2010 the Company had $53,537 in its allowance for doubtful accounts from unpaid related party receivables, with a corresponding 2010 bad debt expense of $53,537. At December 31, 2011 the Company had $92,495 in its allowance for doubtful accounts from unpaid related party receivables, with a corresponding 2011 bad debt expense of $38,958.

Property and equipment

Property and equipment are recorded at cost and depreciated under accelerated or straight line methods over each item's estimated useful life.

Revenue recognition

Revenue is recognized on an accrual basis as earned under contract terms. Specifically, revenue from product sales is recognized subsequent to a customer ordering a product at an agreed upon price, delivery has occurred, and collectability is reasonably assured.

F-6

Advertising costs

Advertising costs are expensed as incurred. The Company had advertising costs in 2010 and 2011 of $1,200 each year.

 

Income tax

The Company accounts for income taxes pursuant to ASC 740. Under ASC 740 deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

At December 2011 the Company had net operating loss carryforwards of approximately $52,000 which begin to expire in 2030. The deferred tax asset of approximately $10,400 created by the net operating loss has been offset by a 100% valuation allowance. The change in the valuation allowance in 2011 was $11,700.

Net income (loss) per share

The net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of shares of common outstanding. Warrants, stock options, and common stock issuable upon the conversion of the Company's preferred stock (if any), are not included in the computation if the effect would be anti-dilutive and would increase the earnings or decrease loss per share.

Financial Instruments

The carrying value of the Company’s financial instruments, as reported in the accompanying balance sheets, approximates fair value.

Long-Lived Assets

In accordance with ASC 350, the Company regularly reviews the carrying value of intangible and other long-lived assets for the existence of facts or circumstances, both internally and externally, that suggest impairment. If impairment testing indicates a lack of recoverability, an impairment loss is recognized by the Company if the carrying amount of a long-lived asset exceeds its fair value.

F-7

Products and services, geographic areas and major customers

The Company earns revenue from the sale of oil and gas maps, but does not separate sales of different maps into operating segments. All sales each year were to domestic companies under common control of the Company’s officers.

NOTE 2. RELATED PARTY TRANSACTIONS

All Company sales of $100,642 and $61,562 for 2010 and 2011 were to companies related by common control of the Company’s officers. Creation and sales of maps to the related companies are made on “as needed” basis, with prices dependent on the map work and complexity involved.

The Company recorded donated services expense of $6,000 for office space donated by an officer in 2010. The Company in 2011 paid a company related by common control $5,100 for office rent under a verbal, as requested arrangement.

NOTE 3.  GOING CONCERN

The Company has suffered losses from operations, has limited working capital and in all likelihood will be required to make significant future expenditures in connection with marketing efforts along with general administrative expenses. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The Company may raise additional capital through the sale of its equity securities, through an offering of debt securities, or through borrowings from financial institutions or related parties. By doing so, the Company hopes through marketing efforts to generate increased revenues from sales of its oil and gas maps. Management believes that actions presently being taken to obtain additional funding provide the opportunity for the Company to continue as a going concern.

F-8

Item 9.    Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.

None.

Item 9A.  Controls and Procedures.

(a)  Evaluation of Disclosure Controls and Procedures.

Our Chief Executive Officer and Principal Financial Officer have evaluated the effectiveness of the design and operations of our disclosure controls and procedures as of the end of the period covered by this quarterly report, and have concluded that our disclosure controls and procedures are adequate.

(b)  Changes in Internal Control over Financial Reporting.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.  Other Information.

None.

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PART III

Item 10.   Directors, Executive Officers and Corporate Governance.

Each of our directors is elected by the stockholders to a term of one year and serves until his successor is elected and qualified. Each of our officers is elected by the board of directors to a term of one year and serves until his or her successor is duly elected and qualified, or until he or she is removed from office. The board of directors has no committees.

The name, address, age and position of our officers and directors is set forth below:

Name and Address		Age		Position(s)
Steven A. Tedesco 6855 South Havana Street, Suite 400 Centennial, Colorado 80112		56		President Chief Executive Officer and Director
Robert W. Carington, Jr. 108 Gatewood Court San Antonio, Texas  78209		50		Chief Financial Officer, Secretary, Treasurer and Director

The persons named above are expected to hold said offices/positions until the next annual meeting of our stockholders. These officers and directors are our only officers, directors, promoters and control persons.

Background Information about Our Officers and Directors

Steve Tedesco has been the President, Chief Executive Officer and a Director of our Company since its inception in November 1987. Our Company has been somewhat of a sideline business for him while he worked with several other businesses in the oil and gas and coal industry.  In the last 25 years of Mr. Tedesco’s involvement in the Oil and Gas and Coal Bed Methane industries, he has come to rely on various mapping sources as an essential production tool.  He has determined that in lieu of outsourcing these custom maps it is easier and more productive to create them himself and have complete control of the data and configuration of his desired final product.  Since inception of Promap in 1987, he has diligently researched and accumulated the comprehensive understanding of mapping techniques and necessary requirements that industry professionals desire when purchasing custom maps.  He focuses most of his time as President and Chief Executive Officer of Admiral Bay Resources, a Canadian junior resource company with coal bed methane assets in Kansas and Pennsylvania, as President of Running Foxes Petroleum, Inc. with producing assets in Utah, Colorado and Kansas and as President of Atoka Coalbed Methane Laboratories Corp. providing unconventional laboratory and surface geochemical services to the industry.  He has over 25 years’ experience working with coals and coal mining and over 22 years’ experience in oil and gas exploration and production.  

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More specifically, since 1988 he has been working in the coal bed methane industry in North American and Europe with a specific focus on Mid-Continent and Eastern US coals.  He has handled such projects from cradle to grave and is well versed in all aspects of oil, gas and coal bed methane operations.  In 1981, he received an MS in Geology from Southern Illinois University specializing in coal and he is presently in the Ph.D program at the Colorado School of Mines.  Mr. Tedesco is the founder of Atoka Coal Labs, a company specializing in coal analysis for the coalbed methane industry.  He has also served as President, CEO and a Director of Admiral Bay Resources Inc., a public company traded on the Toronto Exchange, since November 2005.  During the last 5 years Mr. Tedesco has devoted approximately 20 hours per month to the business of our Company and he expects to continue to devote approximately 20 hours per month to our business.

Robert W. Carington Jr. has served as Chief Financial Officer, Secretary and Treasurer of our Company since July 1, 2009, and as a Director since March 2011.  He has served as Chief Financial Officer of Admiral Bay Resources Inc. from November 2005 until September 2010.  He served as Executive Vice President of Abaxas Petroleum Corporation from July 1998 until October, 2005, and as a director of Abaxas from July 1998 until December 1999.  Prior to joining Abaxas, Mr. Carington was a Managing Director with Jefferies & Company, Inc.  Prior to joining Jefferies & Company, Inc. in 1993, Mr. Carington was a Vice President at Howard, Weil, Labouisse, Friedrichs, Inc.  Mr. Carington was a petroleum engineer with Unocal Corporation from 1983 to 1990.  He received a Bachelor of Science in Mechanical Engineering from Rice University in 1983 and a Masters of Business Administration from the University of Houston in 1990.

Executive Compensation

None of our officers and directors are compensated for the work they perform on our behalf. However, our officers and directors are reimbursed for any out-of-pocket expenses they incur on our behalf. In addition, in the future, we may approve payment of salaries for our management, but currently, no such plans have been approved. In addition, none of our officers, directors or employees is a party to any employment agreements.  

Section 16(a) Beneficial Ownership Reporting Compliance

Our officers, directors and 10% beneficial owners are not subject to Section 16(a).  

Code of Ethics

To date, the Company has not adopted a code of ethics that applies to its executive officers because it only has two executive officers who are also board members.

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Audit Committee

The Company is not listed for trading yet and does not yet have an audit committee.

Item 11.   Executive Compensation.

The following table provides an overview of compensation that we paid to the Named Executive Officers for the fiscal years ended December 31, 2011 and 2010:

Compensation of Directors

Our directors did not receive any compensation from serving as directors during 2010 and 2011.

Outstanding Equity Awards at Fiscal Year-End

We did not have any outstanding equity awards on December 31, 2011.

Item 12.   Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

The following table sets forth the beneficial ownership of our common stock as of December 31, 2011, by (i) each person or entity who is known by us to own beneficially more than 5% of the outstanding shares of common stock, (ii) each of our Directors, (iii) each of the Executive Officers named in the Summary Compensation Table, and (iv) all of our Officers and Directors as a Group:

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Name and Address of Beneficial Owner (1)	Beneficial Ownership(2)(3)		Approximate Percent Owned
Steven A. Tedesco 70608 S. Tuscon Way Centennial, CO  80112	8,425,000(1)		86.6%
Robert W. Carington, Jr. 108 Gatewood Court San Antonio, TX  78209	25,000		*
All Officers and Directors as a Group*	8,450,000		86.9%

* Less than one percent

(1)  Includes 200,000 shares owned by Christine Tedesco, the wife of Steven Tedesco.

Item 13.   Certain Relationships and Related Transactions and Director Independence.

We rent office space from our President and major shareholder, Mr. Steven Tedesco, under a verbal month-to-month lease for which we pay no rent per month.

In the years ended December 31, 2010 and December 31, 2011, approximately 98% of our sales were to Running Foxes Petroleum.  Running Foxes Petroleum pays market prices for all of our products including mapping designs.  All of the mapping services provided to this affiliate are non-contractual and the prices are agreed to in advance by the parties.  Rates are periodically matched by the affiliates with third party rates and are determined to be comparable.  We plan to continue with these transactions but each affiliate is free to use the services of any provider in the marketplace if the conflict of interest becomes an issue with either party.  If the Company needs to deal with a conflict of interest issue, the matter will be addressed by the Board of Directors and any interested directors will abstain from voting on the matter.

Item 14.   Principal Accounting Fees and Services.

Approval of Services

Pending establishment of an audit committee, the Board of Directors pre-approves all engagements for audit and non-audit services provided by the Company's principal accounting firm, Ronald R. Chadwick, P.C.

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Audit Fees

The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for professional services rendered by our principal accounting firm, Ronald R. Chadwick, P.C., for the audit of the financial statements included in Form 10-K, and for the review of the interim condensed financial statements included in Form 10-Q, were approximately $8,750 and $19,000, respectively.

Audit Related Fees

The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for assurance and related services rendered by our current principal accounting firm, Ronald R. Chadwick, P.C., were approximately $0 and $0, respectively.

Tax Compliance/Preparation Fees

The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for professional services rendered by our principal accounting firm, Ronald R. Chadwick, P.C. for tax compliance, tax advice, and tax planning were approximately $0 and $0, respectively. Tax compliance services include the preparation of income tax returns filed with the Internal Revenue Service. Tax advice and planning services included assistance with implementation of tax planning strategies and consultation on other tax matters.

All Other Fees

The aggregate fees billed during the fiscal years ended December 31, 2011 and 2010 for all other professional services rendered by our principal accounting firm Ronald R. Chadwick, P.C. were approximately $0 and $0, respectively. Other services consisted of assistance with the interpretation of new accounting standards and other related services.

Board of Directors Pre-Approval Process, Policies and Procedures

Our principal auditors have performed their audit procedures in accordance with pre-approved policies and procedures established by our Board of Directors. Our principal auditors have informed our Board of Directors of the scope and nature of each service provided. With respect to the provisions of services other than audit, review, or attest services, our principal accountants brought such services to the attention of our Board of Directors prior to commencing such services.

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PART IV

Item 15.   Exhibits and Financial Statement Schedules.

The following documents are filed as part of this Annual Report on Form 10-K:

1.

Consolidated Financial Statements.  See the Consolidated Financial Statements starting on page 14.

2.

Exhibits.  The exhibits listed in the Exhibit Index, which appears immediately following the signature page and is incorporated herein by reference, and filed as part of this Annual Report on Form 10-K.

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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.

Pursuant to the requirements of the Securities Act of 1934 this Annual Report on Form 10-K was signed by the following persons on behalf of the Registrant and in the capacities and on the dates stated:

Name	Title	Date
/s/ Steven A. Tedesco	Director	March 29, 2012
Steven A. Tedesco
/s/ Robert W. Carington, Jr.	Director	March 29, 2012
Robert W. Carington, Jr.

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EXHIBITS INDEX

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