|SECURITIES AND EXCHANGE COMMISSION     
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|Washington, DC 20549                   
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|FORM 10-KSB                            
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|ANNUAL REPORT UNDER SECTION 13 OR 15(d)
|OF THE SECURITIES EXCHANGE ACT OF 1934 
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|For the Fiscal Year Ended December 31, 2005 | Commission File No. 000-24778
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|ADS MEDIA GROUP, INC.                               
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|(Exact name of Small Business Issuer in its charter)
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|UTAH                                                           |  | 87-0505222                       
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|(State or other jurisdiction of
incorporation or organization) |  | (IRS Employer Identification No.)
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|12758 Cimarron Path, Suite B-128, San Antonio, Texas 78249-3426
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|(Address of principal executive offices)                       
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|Issuer's telephone number: (210) 655-6613                      
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|Securities registered under Section 12(b) of the Exchange Act: 
|None                                                           
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|Securities registered under Section 12(g) of the Exchange Act: 
|Common Stock, par value $.001                                  
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|Check whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [   ] Yes [X] No             
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|Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [X]
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|Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [   ] Yes [X] No                                                                                                                                                                                                                       
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|The issuer's revenues for the fiscal year ended December 31, 2005, were $5,477,086.                                                                                                                                                                                                                                                                     
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|The aggregate market value of the voting common equity held by non-affiliates of the registrant on February 28, 2006, was $225,052, based on that day's closing price quotation on the National Quotation Bureau, Inc. "pink sheets".                                                                                                                   
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|Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13, or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.   [X]  Yes     [   ]  No                                                                                                                      
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|The number of shares of the registrant's common stock outstanding as of February 28, 2006, was 19,095,062.                                                                                                                                                                                                                                              
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|DOCUMENTS INCORPORATED BY REFERENCE: None                                                                                                                                                                                                                                                                                                               
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|TABLE OF CONTENTS                                                                                                                                                                                                                                                                                                                                       



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|PART I                            |                                                                                                                                                                                         |              
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|Item 1                            | Description of Business                                                                                                                                                                 | 1            
|                                  | Overview
          Plan of Operations
          Marketing and Distribution
          Technology Systems Development
          Market Overview
          Competition
          Employees | 1
1
3
3
4
4
5
|Item 2                            | Description of Property                                                                                                                                                                 | 5            
|Item 3                            | Legal Proceedings                                                                                                                                                                       | 5            
|Item 4                            | Submission of Matters to a Vote of Security Holders                                                                                                                                     | 5            
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|PART II                           |                                                                                                                                                                                         |              
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|Item 5                            | Market for Common Equity and Related Stockholder Matters                                                                                                                                | 5            
|                                  | Dividend Policy                                                                                                                                                                         | 6            
|                                  | Recent Sales of Unregistered Securities                                                                                                                                                 | 6            
|Item 6                            | Management's Discussion and Analysis or Plan of Operation                                                                                                                               | 6            
|                                  | Risk Factors and Cautionary Statements                                                                                                                                                  | 6            
|                                  | Overview                                                                                                                                                                                | 7            
|                                  | Critical Accounting Policies                                                                                                                                                            | 9            
|                                  | Results of Operations for the Year Ended December 31, 2005, as Compared to the 
            Year Ended December 31, 2004                                                                | 10           
|                                  | Liquidity and Capital Resources                                                                                                                                                         | 10           
|                                  | Changes in Financial Condition                                                                                                                                                          | 11           
|                                  | Commitments                                                                                                                                                                             | 11           
|                                  | Seasonality                                                                                                                                                                             | 12           
|Item 7                            | Financial Statements                                                                                                                                                                    | 12           
|Item 8                            | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure                                                                                                    | 12           
|Item 8A                           | Controls and Procedures                                                                                                                                                                 | 12           
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|PART III                          |                                                                                                                                                                                         |              
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|Item 9                            | Directors, Executive Officers, Promoters and Control Persons; Compliance With Section 16(a) of the Exchange Act                                                                         | 12           
|                                  | Director and Officer Profiles                                                                                                                                                           | 13           
|                                  | Section 16(a) Beneficial Ownership Reporting Compliance                                                                                                                                 | 13           
|Item 10                           | Executive Compensation                                                                                                                                                                  | 14           
|Item 11                           | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                                                                                          | 15           
|Item 12                           | Certain Relationships and Related Transactions                                                                                                                                          | 16           
|Item 13                           | Exhibits                                                                                                                                                                                | 17           
|Item 14                           | Principal Accountant Fees and Services                                                                                                                                                  | 17           
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|SIGNATURES                        | 18                                                                                                                                                                                     
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|CONSOLIDATED FINANCIAL STATEMENTS | F-1                                                                                                                                                                                    
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|PART I                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
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|Item 1. Description of Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
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|Overview                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
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|ADS Media Group, Inc. ("ADS Media"), through its wholly owned subsidiary, Alternative Delivery Solutions, Inc. ("ADS"), is a leading provider of turnkey direct marketing support services, with an emphasis on alternate (i.e., door to door) delivery.  Alternate delivery involves the creation, packaging and delivery (usually on the doors of homes) of solo marketing pieces and co-op marketing programs containing between 2 and 7 pieces of direct marketing material (e.g., brochures, coupons, advertisements and other offerings) to targeted audiences. In addition to alternate delivery, through outsourcing arrangements, ADS provides its clients access to full service direct marketing, printing, list procurement, database management, and fulfillment.  ADS' management is combining their expertise and relationships in direct marketing with sophisticated demographic mapping, tracking, and verification technology to deliver high quality direct marketing services.  ADS Media is based in San Antonio, Texas, and serves customers throughout the United States.                                                                                                                                                                                                                                                                                                                                         
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|ADS was incorporated in Texas on October 22, 2001, under the name Distributel Media Distribution, Inc. The name was changed to Alternative Delivery Solutions, Inc. in 2002. On January 31, 2003, ADS was acquired by National Health and Safety Corporation ("NHLT") in an exchange offer in which all of the ADS shareholders transferred all of their shares of ADS to NHLT in exchange for shares of NHLT's common stock. For accounting purposes this combination was treated as a "reverse acquisition" in accordance with APB 16, with ADS treated as the acquiring company. After the exchange, the former ADS shareholders owned 15,000,000 shares (75%) of the outstanding common stock of NHLT, including shares issuable upon exercise of an outstanding warrant. The acquisition closed January 31, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
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|Plan of Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
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|During 2005, ADS experienced our best financial performance since the inception of the Company, primarily driven by strong sales performance of door delivery programs. A large percentage of the clients throughout the year represented repeat business, with some having placed monthly orders since the fourth quarter of 2004. Other clients have been less frequent in their order rate; however, a few have been advertising with us for over three years. We have worked very hard over the past several years to provide our customers with the best client experience possible. This goes beyond providing high quality distribution to include client services on the front end of every campaign, starting with our comprehensive geo-demographic targeting and mapping capabilities, commercial printing services, and fulfillment. Our clients are provided with a "one-stop" buying experience that provides for greater convenience, better quality and end to end production control, at a very competitive price. Complimentary to our door delivery solutions is our ability to offer the full line of direct mail services. Our management staff is comprised of talented direct marketers, possessing a wealth of experience relative to media and marketing in general.                                                                                                                                             
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|ADS is a marketing solutions company that happens to provide door distribution services as our primary offering. It is this point of differentiation that separates us from the traditional door delivery marketing company, and allows us to acquire business from the most recognized names in the United States, as well as the top advertising agencies. Our business model was built on this premise. To that end, we have set out to develop national door direct delivery capabilities that can provide scale and a high degree of reliability, sophisticated geo-demographic targeting and mapping capabilities, the full suite of production and mailing services, and proprietary product solutions in addition to providing single client specific campaign support. This past year, we have touched on every one of these key components of our business model, and have successfully demonstrated that they are sound strategies capable of producing substantial revenue growth with healthy margins.                                                                                                                                                                                                                                                                                                                                                                                                                       
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|Specific to utilizing commercially available mapping software, ADS has developed proprietary programs that accelerate the time involved in this part of the planning process, thereby enabling our customers with time sensitive data to bring their campaign to market much sooner. Also, these programs have kept our overhead costs associated with mapping to a minimum, which improves margins. For example, a client with multiple locations across the country can receive information specific to each location in a matter of hours or even minutes, utilizing our front end mapping engines. This work used to take days, and even weeks, requiring extensive manual intervention. Speed to market is critical for our clients, and we are able to provide them with the quick turnaround they need as a result of our proprietary front end systems, combined with the latest in mapping software.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
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|Our clients also want turn-key services that include printing of their materials. We have assembled relationships with prominent print organizations, and when combined with competitive pricing, allows our clients one stop shopping for their door direct advertising needs. In dealing direct with client marketing organizations, or the agencies that represent them, this total solution approach has resulted in generating more revenue, while increasing client satisfaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
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|We also demonstrated flexibility in customizing our approach to door distribution. Typically, door delivery is done on what is called a "saturation" basis, meaning every home in a particular geography that is selected gets delivered. We worked with individual clients to address their need to provide more address specific style delivery, which we have done, including work performed this year. Additionally, in 2005 we started to deliver advertising materials to businesses. We have experience with both residential and business delivery as a result of our directory delivery programs. More and more, our clients are wishing to reach the business community utilizing direct to the door delivery. During 2005, we delivered such a campaign for a large national wireless retailer.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
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|Also included in our plan will be our continued focus on the Hispanic market segment. We developed and delivered several bi-lingual campaigns for our clients during the year. In the last half of 2004, and again in the second quarter of 2005, ADS performed a trial launch of our La Canasta de Valores, a door delivered advertising cooperative targeting the Hispanic consumer. La Canasta is a product of ADS, featuring a festive colored, branded poly-bag containing advertising inserts and samples, delivered to high-density Hispanic neighborhoods. La Canasta provides advertisers with a unique and effective print media option to reach the Hispanic consumer, not currently available nationally in a direct-to-door format. The program's translated name, "The Basket of Values", was initially developed in 2002, and relied on securing a "sponsor" advertising client in order to fund production costs for each program. The sponsor pays for the cost of the program and is given advertising placement both in and on the delivery bag. The sponsor also receives limited exclusivity rights, plus input on the areas delivered, quantity and frequency of deliveries.                                                                                                                                                                                                                                        
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|ADS was fortunate to be approached by an agency of a large wireless carrier to act as the "sponsor" on a trial basis. The delivery area consisted of high density Hispanic neighborhoods in select markets throughout California, Texas, Arizona, and Illinois. A total of 4 delivery drops of 1 million households each were delivered. Despite a very short production window, we were able to secure additional ride-a-long advertisers. Feedback from the sponsor and the participating advertisers was positive. The difficulty we experienced in securing the sponsor in a more permanent relationship was their reluctance to enter into a long term commitment, combined with the uncertainties brought about by a merger they were currently going through.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
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|Despite our success in at least securing sponsorship for a trial launch of La Canasta, ADS realized the program has enough merit to explore a marketing and financial scenario which does not rely on a sponsor, but may actually be funded internally by us. We received valuable trade press based on the trial launch, and received numerous inquiries about offering advertisers a regularly scheduled program in which they can participate, instead of one that may only last for a few delivery drops. The response and continued interest in La Canasta requires us to explore all options for continuing the program at some point, either sponsored by an advertiser or self-funded by ADS.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
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|Similar to La Canasta, we have the capability to provide clients with their own direct to door advertising cooperative targeting specific trade areas or demographic selects. In this situation, the client is the "sponsor" of their own program, and has the ability to define the entire program based on their individual needs.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
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|Event driven marketing promotions such as grand openings continued to be a part of the orders that we received throughout 2005. Our advertisers, especially those in retail and wireless communications, used direct-to-door advertising to announce their new locations and opening dates. During 2005, ADS continued to demonstrate the effectiveness of the door medium to generate traffic into new store locations. We continue to believe that, as large national retail chains and national communication companies expand into new areas, the need for grand opening support will be strong for years to come. ADS will continue to focus on these, and other, event driven, promotional opportunities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
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|Marketing and Distribution                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
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|We have worked hard over the past several years to provide our customers with the best client experience possible. This goes beyond providing high quality distribution to include client services on the front end of every campaign, starting with our comprehensive geo-demographic targeting and mapping capabilities, commercial printing services, and fulfillment. Our clients are provided with a "one-stop" buying experience that provides for greater convenience, better quality and end to end production control, at a very competitive price. Complimentary to our door delivery solutions is our ability to offer the full line of direct mail services. Our management staff is comprised of talented direct marketers, possessing a wealth of experience relative to media and marketing in general.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
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|In 2005, ADS continued to develop new channel partners, especially with general market and Hispanic advertising agencies. The trial launch of the La Canasta program necessitated that we reach out to Hispanic advertising agencies, as well as those within the general market segment, in an attempt to attract national advertisers. We were successful in making those contacts, which has proven beneficial for the Company in many ways beyond La Canasta.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
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|Advertising agencies are always looking for new print media alternatives. Though door direct has been an established media long before television and radio, it is considered a new media alternative. Declining response rates and higher costs associated with traditional media has forced advertisers and their agencies to look for ways to generate better returns on the media dollar invested.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
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|We still have sales being generated from commercial printers, another of our channel partners, though less of our focus is allocated to this area. Instead, we have found other opportunities to develop new channel partners that will provide us with better reach into the retail and consumer packaged goods sectors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
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|ADS did very little in the way of advertising its services through key trade publications, participation in trade shows, and by generating external public relations. Instead, our focus was on deriving revenues from our channel partners and directly with clients.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
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|The increase in sales and volume has necessitated that we continue to develop new delivery sources nationally and now internationally. We have clients that are indeed requesting international delivery service. The key is to expand capacity while maintaining the quality of delivery. To that end, we began a comprehensive search for new delivery sources at the end of 2005, along with exploring new means of performing delivery verification. This is a major priority of the Company as it continues to implement its core business strategies.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
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|Technology Systems Development                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
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|During 2005, we continued to invest in developing our geo-demographic mapping capabilities. We successfully developed and launched new proprietary software that automates much of the actions and labor required during the mapping process. This proprietary software was designed not only to reduce the man-hours associated with these activities, but just as importantly, to provide our customers with a tool that would allow them to be involved in determining their own delivery footprint. We recognized that our clients were requesting more involvement in determining the actual delivery areas for their campaigns. This has been especially important for large franchised operations, such as the retail fast food industry. In these instances, the corporate marketing groups and their advertising agencies want to allow franchisees control in determining both the delivery area and their costs, relative to budget, for these types of campaigns. We now have the capabilities to provide them with a tool where they can manage their own campaigns to determine delivery area, type of message/offer used, and scheduling of distribution. This benefits us as well, by offsetting the labor costs associated with the development of delivery maps for these types of campaigns, and allows faster turnaround in the client planning process. It also provides a user friendly environment for our clients.
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|This year, we continued to explore new global positioning technology to augment the delivery verification process. Still, the expense associated with implementing this technology makes these solutions cost prohibitive. However, we anticipate that cost will go down as the technology evolves, possibly providing an effective means for supplementing our delivery verification protocols, translating into greater delivery assurance for our clients.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
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|In 2003, ADS Media Group launched its website on the Internet, www.adsmediagroup.com. The site includes corporate information about ADS Media and its management and directors, as well as the ability to download filings with the SEC and press releases issued by the company. Additionally, descriptions and schedules of the services and products of ADS are provided for shareholders, media industry analysts and new customers, as well as a password protected extranet for existing customers to track their jobs. Work continues to update and refine the website.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
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|Market Overview                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
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|Ever increasing postage rates, combined with lower response from direct mail programs, have created an ideal market opportunity for door distribution programs. Similarly, newspapers are seeing declines in readership. The percentage of adults reading the Sunday newspaper has gone down each year since 2000 through 2005. The Hispanic population is the fastest growing segment of the population according the U.S. Census Bureau; however, the total number of Hispanics reading the Sunday newspaper has remained relatively constant and in 2005 represented only 36.9% of the identified adult Hispanic population. Meanwhile, rates for newspaper advertising continue to rise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
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|Advertisers are looking for better reach and return, and alternate delivery provides both. ADS has access to a national network of delivery resources, providing door-to-door delivery, and can extend this reach utilizing other delivery vendors capable of supplementing the existing delivery network on a city specific basis. Depending on customer requirements, delivery can be performed anywhere in the United States, Mexico, Canada, and Puerto Rico. As mentioned, we are now able to expand our delivery capabilities internationally to Europe, Asia, and Australia.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
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|The ability to offer both direct mail and alternate delivery programs is a distinct competitive advantage for ADS. The vast majority of alternate delivery companies only provide door distribution services, and the same is true with companies in the direct mail business. ADS has assembled a network of strategic partnerships and vendor relationships that allow it the flexibility to provide customized solutions to meet any direct marketing need a client may have. These capabilities make it possible to provide event marketing services and directory distribution as well.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
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|Competition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|The advertising market in general, and the alternative delivery market specifically, are highly competitive, with a proliferation of existing groups at local and regional levels, offering similar services as ADS. In addition to being highly competitive, both of these markets are subject to rapid innovation and technological change, shifting consumer preferences and frequent new product and service introductions. Additionally, competition exists from traditional products and services offered through other marketing mediums and channels, such as newspaper, other print media, television, radio, billboard and internet sites, which may have all or some of the same customers targeted by ADS.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|While ADS believes that it can develop a market niche and differentiate itself from its competition by providing customers with the ability to deliver their marketing and advertising in multiple geographic markets and benefit from dealing with one firm (ADS) instead of many individual firms in every geographic market where deliveries are desired, ADS may be susceptible to attempts by others to duplicate its efforts. It is possible that other parties with greater resources will be able to replicate, or improve upon, ADS' business concepts and become market leaders, potentially reducing ADS' future earnings and business opportunities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Employees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|1 Source - Scarborough Research Top 50 Market Reports 1998-2005, Sunday Newspaper Research Trends - Race/Ethnicity                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

|On December 31, 2005, ADS Media and its subsidiary had 10 full-time employees, including 3 in sales and marketing, 4 in distribution and fulfillment services and 3 in general and administrative functions. In addition, we routinely engage outside contractors to perform fulfillment and distribution operations.                                                                                                                                                                 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Item 2. Description of Property                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|At the beginning of 2003, ADS leased office space at 15454 Tradesman, San Antonio, Texas 78249 in Northwest San Antonio.  The space contained a total of 28,000 square feet, of which approximately 8,000 square feet was finished office area and the balance was warehouse/assembly space.  The property was adequately covered by insurance.                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Effective January 1, 2004, an amendment to the original lease agreement was signed calling for a reduction of leased office space with a corresponding reduction in monthly rent paid by ADS. The amendment also provided for the early termination of the lease by either the landlord or ADS with a written notice to the other party of not less than 60 days. Effective March 31, 2005, this lease was terminated early.                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|On January 10, 2005, ADS signed an original lease agreement for approximately 6,600 square feet of office/warehouse space at 12758 Cimarron Path, Suite B-128, San Antonio, Texas 78249.  The lease was to commence February 1, 2005 for a period of three (3) years and three (3) months. Effective January 24, 2005, an amendment to the original lease was signed delaying the commencement date of the lease to April 1, 2005, with a term of three (3) years and five (5) months.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Item 3. Legal Proceedings                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|On July 2, 2004, RR Donnelley Receivables, Inc. sued ADS to collect a sworn account in the amount of $28,503.76, plus attorney fees and expenses. ADS responded with a general denial and a counterclaim for breach of contract regarding a partnership with the plaintiff in Mexico. In November 2005, the counterclaim was dismissed on jurisdictional grounds. The suit on the sworn account remains pending, but no activity has taken place since November 2005.                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Item 4. Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|No matters were submitted to a vote of security holders during the fourth quarter of 2005.                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|PART II                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Item 5. Market for Common Equity and Related Stockholder Matters                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Effective January 1, 2004, ADS Media's Common Stock began trading in the National Quotation Bureau, Inc. "pink sheets" under "ADS Media Group, Inc."                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|The following table sets forth the range of high and low bid prices of the Common Stock for the periods indicated as reported by the OTC Bulletin Board. Quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.                                                                                                                                                                                          

|     | 1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter
|---- | ----------- | ----------- | ----------- | -----------
|     | High        | Low         | High        | Low        
|     |             |             |             |            
|2004 | 0.23        | 0.12        | 0.13        | 0.05       
|2005 | 0.05        | 0.05        | 0.05        | 0.04       
|     |             |             |             |            

|As of February 28, 2006, there were approximately 500 shareholders of record for our common stock, which figure does not take into account those shareholders whose certificates are held in the name of broker-dealers.                                                                                                                                                                                                                  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Dividend Policy                                                                                                                                                                                                                                                                                                                                                                                                                           
|ADS Media has not declared or paid cash dividends or made distributions in the past, and does not anticipate that it will pay cash dividends or make distributions in the foreseeable future. ADS Media currently intends to retain and reinvest future earnings to finance its operations. Holders of the preferred shares are entitled to receive redemption payments before ADS Media may pay any dividends on its other capital stock.
|                                                                                                                                                                                                                                                                                                                                                                                                                                          
|Recent Sales of Unregistered Securities                                                                                                                                                                                                                                                                                                                                                                                                   
|From January 1, 2005 through December 31, 2005, ADS Media issued the following securities that were not registered under the Securities Act of 1933 (the "Securities Act"). All of these securities were issued in privately negotiated transactions effected in reliance on the exemption contained in Section 4(2) of the Securities Act.                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                          

|* | On eight separate occasions in 2005, ADS Media issued a total of 145,846 shares of common stock to a consultant's partnership, in which two 5% shareholders are partners, in exchange for professional services. The dates, amounts, and stock prices for these shares are as follows.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                       

| | Date       | Number of Shares | Price per Share
| | ---------- | ---------------- | ---------------
| | March 2005 | 16,377           | $0.13          
| | April 2005 | 15,485           | $0.13          
| | May 2005   | 14,723           | $0.13          
| | May 2005   | 3,938            | $0.13          
| | June 2005  | 19,415           | $0.13          
| | June 2005  | 34,146           | $0.13          
| | July 2005  | 31,175           | $0.13          
| | July 2005  | 10,587           | $0.13          



|* | In May 2005, ADS Media issued 57,143 shares of common stock, at a price of $0.14 per share, to a vendor in exchange for reduction of accounts payable.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                       

|Item 6. Management's Discussion and Analysis of Financial Condition and Results of Operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto included as Item 7 of this Report on Form 10-KSB. The consolidated financial statements and related footnotes included herein include the financial statements of ADS.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Risk Factors and Cautionary Statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|This report contains forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. When used in this document and in documents incorporated herein by reference, the words "anticipates," "believes," "estimates," "expects," "intends," "plans," "potential," or "continue," "may," "will," "should," and similar expressions are intended to identify forward-looking statements. ADS Media wishes to advise readers that actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements, including, but not limited to, the following: the ability of ADS Media to continue as a viable concern, the ability of ADS Media to obtain financing in order to implement its business plan and other risks detailed in ADS Media's periodic report filings with the Securities and Exchange Commission.                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Overview                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|ADS was incorporated in 2001. In early 2003, ADS was acquired by ADS Media, formerly known as National Health and Safety Corporation, whose common stock was publicly traded on the OTC Bulletin Board. At the time of the acquisition, ADS needed capital to implement its business plan to build a multi-city advertising door delivery organization, and it was thought that ADS Media would be better able to attract outside equity investments as a public company. In 2003 we raised $480,000 from sales of stock in transactions associated with the acquisition.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|However, after the acquisition in early 2003, we did not attract significant additional equity investments. Because we did not obtain new investments, we could not implement our business plan as scheduled, incurred substantial past due accounts receivable, curtailed compensation and were forced to forego needed staff expansion.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|In 2004 and 2005, we raised no significant amounts from sale of equity and funded all operations internally. As a result, our ability to develop and execute sales programs was severely curtailed. We have not had adequate staff or financial resources to take advantage of all marketing programs that were presented to us, to plan for growth, to conduct extensive external marketing efforts for our program or to adequately staff our financial reporting operations.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Despite these impediments, our management team and staff continued to solicit sales and develop new programs to sell our marketing services. In 2004, we made a trial launch of our La Canasta de Valores, a door delivered advertising cooperative targeting the Hispanic consumer. La Canasta is a product of ADS, featuring a festive colored, branded poly-bag containing advertising inserts and samples, delivered to high-density Hispanic neighborhoods. La Canasta provides advertisers with a unique and effective print media option to reach the Hispanic consumers, not currently available nationally in a direct-to-door format. The program's translated name, "The Basket of Values", was initially developed in 2002, and relied on securing a "sponsor" advertising client in order to fund production costs for each program, but until 2004 we did not have sponsorship or the resources to test it ourselves. In our trial launch, the sponsor paid for the cost of the program and received advertising placement both in and on the delivery bag. The sponsor also received limited exclusivity rights, plus input on the areas delivered, quantity and frequency of deliveries.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|During 2005, ADS experienced our best financial performance since the inception of the Company, primarily driven by strong sales performance of door delivery programs. A large percentage of the clients throughout the year represented repeat business, with some having placed monthly orders since the fourth quarter of 2004. We received orders directly from clients and in other instances advertising agencies representing their own customer accounts. The majority of the business in 2005 was placed by advertising agencies.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|A strong concentration of business came from the Telecommunications sector, representing a variety of programs ranging from grand openings, new product launches, business-to-business delivery, and sponsorship of our La Canasta program. Retail and Fast Food sectors followed close behind the Telecom sector in terms of total revenue, with sales to these types of customers representing the fastest growing portion of our revenue mix during the last half of 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|As mentioned, in the last half of 2004, and again in the second quarter of 2005, we were fortunate to be approached by an agency of a large wireless carrier to act as the "sponsor" on a trial basis. The delivery area consisted of high density Hispanic neighborhoods in select markets throughout California, Texas, Arizona, and Illinois. A total of 4 delivery drops of 1million households each were delivered. Despite a very short production window, we were able to secure additional ride-a-long advertisers. Feedback from the sponsor and the participating advertisers was very positive.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Despite the positive response, the sponsor was reluctant to commit to an annual agreement. We received valuable trade press based on the trial launch, and received numerous inquiries about offering advertisers a regularly scheduled program in which they can participate, instead of one that may only last for a few delivery drops.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|2 As an example, we fell two years behind in our obligations to file periodic reports with the SEC. In early 2006, our improving operating results allowed us to catch up on filing all SEC reports since 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Based on our experience, we will continue to explore new sponsors; however we have realized the program has enough merit to explore a marketing and financial scenario which does not rely on a sponsor, but may actually be funded internally depending on obtaining additional capital to do so.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|In addition to La Canasta, we've performed many campaigns in which the Hispanic consumer was either the primary or secondary target desired by our clients. The door delivery media provides one of the best vehicles for advertisers to reach this important consumer segment with a printed message and/or offer. Our ability to identify and deliver print media to the Hispanic consumer, and our La Canasta program, is a major reason why Hispanic door delivery programs are a major focus of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Our clients also want turn-key services that include printing of their materials. We have assembled relationships with prominent print organizations, and when combined with competitive pricing, allows our clients one stop shopping for their door direct advertising needs. Printing these materials had a positive impact on 2005 revenues.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|We have incurred total operating losses from inception through 2005, but we have steadily improved performance and posted our first truly positive fiscal results in 2005 after basically breaking even in 2004. Our improving results are the result of steadily increasing sales and continued efforts by management and our employees to minimize expenses. The following table summarizes our results for the three years since ADS was acquired by ADS Media in January 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|Selected Financial Data                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

|                                | As of December 31,
|------------------------------- | ------------------
|                                | 2005              
|Income Statement Data:          |                   
|Revenues                        | $ 5,477,086       
|Cost of goods sold              | 3,554,352         
|Net income (loss)               | 298,172           
|Basic earnings (loss) per share | $          0.02   
|                                |                   
|Balance Sheet Data:             |                   
|Current assets                  | 1,003,780         
|Total assets                    | 1,276,473         
|                                |                   
|Current liabilities             | 1,525,629         
|Total liabilities               | 1,529,681         
|Total stockholders' deficit     | $   (253,208)     
|                                |                   

|While we are encouraged by our improved results, lack of capital to pay past debts and to beef up our staff and equipment for larger scale projects continues to hamper growth. Management believes that outside investment capital of several million dollars is required in order to execute our business plan, continue revenue growth, and sustain profitability. Without such an investment, we will not be able to take advantage of many otherwise attractive sales opportunities because of our small size and limited financial capacity.                                                                                                                                                               
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Critical Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|The financial statements of ADS Media were prepared in accordance with generally accepted accounting principles in the United States, which require ADS Media to make estimates and judgments that affect the reported financial position and results of operations during the reporting period. Our estimates and judgments are continually evaluated based on available information and experience. Because the use of estimates is inherent in the financial reporting process, actual results could differ from estimates. If there is a significant unfavorable change to current conditions, it likely will result in a material adverse impact to our business, operating results and financial condition.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Our significant accounting policies and methods used in the preparation of the consolidated financial statements are discussed in Note A to the Notes to Financial Statements in Item 7 of this annual report on Form 10-KSB. We believe that, of its significant accounting policies, the following may involve a higher degree of judgment and complexity:                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

|- | Concentration of credit risk and accounts receivable;
|- | -----------------------------------------------------
|- | Asset impairment; and                                
|- | Goodwill.                                            
|  |                                                      

|Concentration of Credit Risk and Accounts Receivable: Generally our customers pay 50% - 70% of the total fee in advance and the remaining portion within 45 days of completion of services. Our business model generally requires a deposit by the customer; however, in some cases, we will give minimal credit terms to customers if they have an established and good payment history with us. We extend unsecured credit in the normal course of business to virtually all of our customers. In the event of non-performance of accounts receivable, its maximum exposure is the recorded amount shown on the balance sheets. Concentration of credit risk and failure to collect accounts receivable have not presented significant problems to ADS Media.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|ADS Media establishes an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Asset Impairment: We review long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the long-lived assets, the carrying value is reduced to the estimated fair value as measured by the discounted cash flows. We have not experienced any events or changes that would indicate that the carrying amounts of any of its long-lived assets might not be recoverable.                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Goodwill: We assess the carrying value of goodwill annually and when factors are present that indicate an impairment may have occurred. Goodwill is considered impaired and a loss is recognized when its carrying value exceeds its implied fair value. Factors that are considered important which could trigger an impairment review include the following:                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

|- | significant underperformance relative to expected historical or projected future operating results;      
|- | ---------------------------------------------------------------------------------------------------------
|- | significant changes in the manner or use of the acquired assets or the strategy for our overall business;
|- | significant negative industry or economic trends;                                                        
|- | significant decline in stock price for a sustained period; and                                           
|- | our market capitalization relative to net book value.                                                    
|  |                                                                                                          

|Each year ADS Media assesses the realizability of the recorded goodwill and other intangibles in accordance with Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets". At December 31, 2005 and 2004, the analysis indicated that goodwill of $250,000, attributed to the value of a publicly traded "shell" company which we acquired, was not impaired. The Company will continue to test on a consistent measurement date unless events occur or circumstances change between annual impairment tests that would more likely than not reduce fair value below its carrying value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Results of Operations for the Year Ended December 31, 2005, as Compared to the Year Ended December 31, 2004                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|From inception to December 31, 2005, ADS Media incurred significant net losses from operations. We have not had funds available from either new investments or cash flow to grow our business as we expected in our marketing plan. Nevertheless, increases in revenue from operations have helped to offset the increased operating costs of building our infrastructure, with 2005 being our second consecutive year in which we realized a net operating profit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Revenues. Revenues increased $1,808,215, or 49%, to $5,477,086 from $3,668,871. The increase was due to continuing to develop a diverse base of customers, combined with building solid repeat business involving door delivery.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Cost of Goods Sold. Cost of goods sold increased $960,008, or 37%, to $3,554,352 from $2,594,344. The increase was primarily attributed to a corresponding increase in revenues and sales activity as discussed above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Gross Profit. Gross profit increased $848,207, or 79%, to $1,922,734 from $1,074,527. The increase was primarily attributed to the increase in revenues combined with margins improving as a result of the focus on selling products that offer higher gross profit. The gross profit margin percentage increased to 35% in 2005 from 29% in 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Selling, administrative and other operating expenses. Selling, administrative and other operating expenses increased $588,539, or 59%, to $1,587,877 from $999,338. The increase was primarily due to expenses associated with building our business and operational infrastructure, including salaries and wages and professional fees associated with the Company's financial statement audits and related regulatory filings, and marketing services.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Income from operations. Income from operations increased $259,668, or 345%, to $334,857 from $75,189. The increase was primarily due to the increase in revenues and gross profit, partially offset by increased operating expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Other income (expense). Net other expense decreased $37,409, or 50%, to $36,685 from $74,094. The primary component, interest expense, decreased $40,443, or 52%, to $36,685 from $77,128. This decrease was primarily due to the absence in 2005 of expenses related to warrants issued in connection with obtaining debt financing in 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Net income. Net income increased $297,077, or 27130%, to $298,172 from $1,095. The increase was primarily due to the increase in revenues and gross profit, along with the reduction in interest expense, partially offset by the increase in selling, administrative and other operating expenses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Liquidity and Capital Resources                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|ADS Media's working capital needs have historically been satisfied primarily through financing activities including private loans and raising capital through equity investments from individual investors. Long-term liquidity requirements will depend on the rate of expansion of our business.  We believe future operations can be financed at least in part from cash flow, but additional investment from outside investors may be required to fund expansion into new geographic areas and to launch new product initiatives.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|ADS Media had cash and cash equivalents of $446,142 as of December 31, 2005, compared to $208,860 as of December 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Working capital (measured by current assets less current liabilities) at December 31, 2005, was a deficit of $521,849 compared to a deficit of $852,053 at December 31, 2004. This increase in working capital was primarily due to increases in cash and net accounts receivable and decreases in accounts payable, customer advance payments and notes payable, partially offset by increases in accrued salaries and wages and accrued liabilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Changes in Financial Condition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|For the year ended December 31, 2005, cash provided by operating activities totaled $298,110. The provision of funds was primarily due to our net income, with an increase in accounts receivable and a decrease in customer advance payments offset by an increase in accounts payable and accrued expenses, bad debt expense and the issuance of common stock for professional services. For the year ended December 31, 2004, cash provided by operating activities totaled $152,733. The provision of funds was primarily due a significant increase in accounts payable and accrued expenses, a decrease in prepaid expenses and other assets, and the issuance of warrants in connection with obtaining debt financing, partially offset by a significant increase in accounts receivable and a decrease in customer advance payments.                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|For both years ended December 31, 2005 and 2004, cash used in investing activities was minimal, at $3,944 and $905, respectively, in each case for small capital expenditures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|For the year ended December 31, 2005, cash used in financing activities totaled $56,884 primarily due to payments on notes payable. For the year ended December 31, 2004, cash provided by financing activities totaled $37,368 due mainly to proceeds from the issuance of notes payable, partially offset by payments on notes payable. In 2004 we netted proceeds from the sale of notes payable, after deducting payments on outstanding notes, of approximately $40,000. We issued no new notes payable in 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Commitments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|ADS leased office space at 15454 Tradesman, San Antonio, Texas 78249. The space contained a total of 28,000 square feet, of which approximately 8,000 square feet was finished office area and the balance was warehouse/assembly space.  The lease, dated October 14, 2002, was for three (3) years, with the total rent being approximately $10,000 per month in year one, increasing to $11,000 per month in years two and three. The property was adequately covered by insurance.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|After the closing of the reverse acquisition on January 31, 2003, ADS Media began sharing the space located at 15454 Tradesman, San Antonio, Texas 78249 with ADS.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Effective January 1, 2004, an amendment was signed to the original lease agreement (dated October 14, 2002) between Cadena Enterprises, Inc. ("Cadena") and ADS calling for a reduction of leased office space with a corresponding reduction in monthly rent paid by ADS from $10,000 per month to $4,000 per month. The amendment also provided for the early termination of the lease by either Cadena or ADS with a written notice to the other party of not less than 60 days. Additionally, all past due amounts owed by ADS to Cadena for unpaid rents, property taxes and insurance charges were combined and set forth in a Promissory Note dated January 1, 2004 in the amount of $65,403. The Promissory Note carries an annual interest rate of 5.5%, was due and payable in quarterly installments of $1,500 or more beginning on April 1, 2004, and continued quarterly thereafter until paid in full, provided that all remaining amounts due were payable in full on February 1, 2005. Effective February 1, 2005, the Promissory Note was renewed, payable in monthly installments of $1,500 beginning September 1, 2005. Effective March 31, 2005, this lease was terminated early.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|On January 10, 2005, ADS signed an original lease agreement for approximately 6,600 square feet of office/warehouse space at 12758 Cimarron Path, Suite B-128, San Antonio, Texas 78249.  The lease was to commence February 1, 2005 for a period of three (3) years and three (3) months. Effective January 24, 2005, an amendment to the original lease was signed delaying the commencement date of the lease to April 1, 2005, with a term of three (3) years and five (5) months. Base monthly rent shall be $0 per month for the first three months, $3,967 per month for the next nine months, $4,588 per month in year two, $4,993 per month in year three, and $5,128 per month for the final five months. Monthly operating expenses (including amounts for taxes, insurance, and common area maintenance) are in addition to the base monthly rent. The property is adequately covered by insurance.                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Seasonality                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|ADS's business historically has not been seasonal.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Item7. Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|The information required by this item is set forth in ADS Media's Consolidated Financial Statements and Notes thereto beginning at page F-1 of this report.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Item 8. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Item 8A. Controls and Procedures.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of December 31, 2005. Based on that evaluation, our management, including the CEO, concluded that our disclosure controls and procedures were effective as of December 31, 2005. During the time period covered by this report, there were no changes in our internal control over financial reporting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|From the third quarter of 2003 through the present, we have been unable to pay for the costs to employ a chief financial officer who was familiar with accounting procedures and auditing standards for publicly held companies. We did not file our quarterly and annual reports with the SEC on time for fiscal 2003, 2004 or the first three quarters of 2005. We filed all past due reports with the SEC in the first quarter of 2006. We have devoted resources to assuring that future reports will be filed on a timely basis. Inability to file a timely report indicates a material weakness in our internal control over financial reporting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|PART III                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Item9. Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|The following table sets forth the names, ages and positions held with ADS Media by its directors and executive officers.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|Name                  | Age* | Positions Held                                                                                                   
|--------------------- | ---- | -----------------------------------------------------------------------------------------------------------------
|                      |      |                                                                                                                  
|Clark R. "Dub" Doyal  | 57   | Chairman, Chief Executive Officer, President and Director, Chairman and Chief Executive Officer of subsidiary ADS
|                      |      |                                                                                                                  
|James D. (Jim) Schell | 46   | Vice President, Secretary, Treasurer and Director, President of subsidiary ADS                                   
|                      |      |                                                                                                                  
|Gary J. Davis         | 52   | Director                                                                                                         
|                      |      |                                                                                                                  
|Bryan Forman          | 43   | Director                                                                                                         
|                      |      |                                                                                                                  

|* Age of directors and executive officers is determined as of January 1, 2006.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|All directors hold office until the next annual meeting of shareholders and serve until their successors have been duly elected and qualified. There are no agreements with respect to the election of directors. The Board of Directors appoints officers annually and each executive officer serves at the discretion of the Board of Directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Pursuant to the provisions of the stock exchange agreement between NHLT and ADS, one of those directors, Jimmy E. Nix, II, resigned as a director of ADS Media on February 3, 2003.  One seat on the five member board of ADS Media has been vacant since the resignation of Mr. Nix.  The bylaws provide that vacant seats on the board may be filled by the remaining directors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Director and Officer Profiles                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Clark R. "Dub" Doyal is the Chairman, Chief Executive Officer, President and a director of ADS Media Group.  Mr. Doyal is also the Chairman and Chief Executive Officer of Alternative Delivery Solutions, Inc.  Mr. Doyal has over 30 years experience in printing and direct marketing, having owned and built a number of successful companies during his career that provided marketing services. In 1981, Mr. Doyal started a business called Clear Visions Printing and Mailing, to compete with almost 140 other printers in San Antonio.  In 1995, Mr. Doyal sold Clear Visions to Consolidated Graphics, after taking the company to the number one spot in San Antonio. Since then, Mr. Doyal has built and sold his interest in a couple of companies in the alternate delivery industry, including one in Mexico City called Quicklink, SA, which provided door distribution to over 600,000 households on a weekly basis.  In late 1998, Mr. Doyal formed Delivery and Communications, Inc., a local and regional supplier of door delivery services, and sold his interest in that company prior to forming ADS in 2001 to specifically serve the growing demand for national door direct delivery.  Mr. Doyal is a graduate of Louisiana State University.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|James D. (Jim) Schellis Vice President, Secretary, Treasurer and a director of ADS Media.  He is also President of its operating subsidiary, ADS, and was recruited to lead the effort to build national client relationships, along with providing marketing support specific to ADS's product development and marketing strategy. He joined ADS in November 2001. For the 20 years before his move to ADS, Mr. Schell worked for SBC Communications, Inc., focusing on development and implementation of numerous regional and national product initiatives. He also spent 8 years managing regional sales operations for Southwestern Bell Yellow Pages. Mr. Schell received his B.B.A. in Marketing from Texas Tech University.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Gary J. Davisis a director of ADS Media.  Mr. Davis is the President of First Advisors, Inc., of Austin, Texas, which is involved in business consulting and private capital investment in start-up and early stage companies.  Mr. Davis founded First Advisors, Inc. in 1996.  Mr. Davis has spent a major portion of his career over the past 33 years in a wide range of capital raising endeavors, including debt and equity for real estate ventures and private equity capital for business ventures. Additionally, Mr. Davis continues to be an active real estate investor in projects throughout Texas. Mr. Davis previously was the chairman, president and CEO of NHLT from February 9, 2001, to January 30, 2003, and has served on the board of directors of NHLT and ADS Media from 2001 to the present.                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Bryan Formanis a director of ADS Media and has provided legal services to NHLT as outside counsel prior to reorganization into ADS Media.  Since 1991, Mr. Forman focused his career in the ownership and executive management of three NASD registered broker-dealers, most recently serving as chairman and chief executive officer of First Avantus Securities, Inc. from January 1996 until April of 2002. Currently, Mr. Forman is in the private practice of law in Tyler, Texas, and also serves as a mediator, arbitrator, and expert witness in the securities industry.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|**Section 16(a) Beneficial Ownership Reporting Compliance**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Section 16(a) of the Securities Exchange Act of 1934 requires our executive officers, directors and persons who beneficially own more than 10% of our common stock to file reports of ownership and changes in ownership with the Securities and Exchange Commission. These persons are required by the Securities and Exchange Commission regulations to provide us with copies of all Section 16(a) forms that they file.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Based solely upon a review of the copies of the forms furnished to the Company, or representations from certain reporting persons that no reports were required, the Company believes that no persons failed to file required reports on a timely basis during or in respect of 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|Item10. Executive Compensation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|The following table summarizes the compensation of the Chief Executive Officer and the other most highly compensated executive officers of ADS Media and its subsidiaries during the past year (the "Named Executive Officers").                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

|Summary Compensation Table
|--------------------------
|Name                      
|Clark R. "Dub" Doyal,     
|Chief Executive Officer   
|                          
|                          
|James D. (Jim) Schell,    
|Vice President, Secretary,
|Treasurer                 
|                          

|(1) | Includes $130,669, $67,995, and $110,831 in salary voluntarily deferred in 2005, 2004, and 2003, respectively, by Mr. Doyal. Also includes $62,769, $77,847, and $80,710 in salary voluntarily deferred in 2005, 2004, and 2003, respectively, by Mr. Schell. These salaries will remain deferred until such time as cash flow permits payment.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                

|Option/SAR Grants in Last Fiscal Year.There were no stock appreciation rights ("SAR") grants made to any Named Executive Officers during the year ended December 31, 2005.                                                                                        
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                  
|Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End Option/SAR Values. The following table shows the number of options exercised during 2005 and options held at December 31, 2005 by the Named Executive Officers. No SARs have been granted.

|Aggregated Option/SAR Exercises in Last Fiscal Year and FY-End Option/SAR Values
|--------------------------------------------------------------------------------
|Name                                                                            
|James D. (Jim) Schell                                                           
|                                                                                

|Compensation of Directors. No compensation was paid to any Director in 2005 in connection with their board service. ADS Media does reimburse its directors for reasonable expenses associated with attending board or committee meetings.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Employment Agreements. ADS Media's subsidiary, ADS, had employment agreements with Mr. Doyal, who serves as Chairman, Chief Executive Officer and President of ADS Media and Chairman and Chief Executive Officer of ADS, and with Mr. Schell, who is Vice President, Secretary, and Treasurer of ADS Media, and President of ADS. Mr. Doyal's agreement provided for a base salary of $299,520 in 2005. Mr. Schell's agreement provided for a base salary of $249,600 in 2005. Because of a lack of revenues, both Mr. Doyal and Mr. Schell have foregone a substantial amount of their agreed compensation in 2003 and 2004. Both Mr. Doyal's and Mr. Schell's employment agreements were for three year terms that ended in December 2005. The agreements provided for incentive bonus based on whether the company achieved a target income before taxes, determined by the board of directors. We make available to the executives the same employee benefits generally made available to other managers and employees. The agreements contain non-competition clauses for 24 months after termination of the agreement and provisions regarding confidentiality of company information.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Item11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|The following table shows, as of December 31, 2005, the beneficial ownership of our common stock held by (i) each person who is known by us to beneficially own more than 5% of the outstanding shares of any class of our voting securities; (ii) each of our directors; (iii) each of our Named Executive Officers; and (iv) all of our directors and Named Executive Officers as a group. Unless indicated otherwise, the address of each person listed below is c/o ADS Media Group, Inc., 12758 Cimarron Path, Suite B-128, San Antonio, Texas, 78249.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



| | Name of Beneficial Owners                                               | Number of Shares
Beneficially Owned (1) | Percentage of
Ownership (2)
| | ----------------------------------------------------------------------- | --------------------------------------- | ---------------------------
| |                                                                         |                                         |                            
| | Gavin M. Gray (6)
701 Brazos Street, Suite 960
Austin, Texas 78701      | 1,856,814                               | 9.7%                       
| |                                                                         |                                         |                            
| | Clyde J. Berg
600 Congress Ave.
Austin, Texas 78701                     | 1,565,846                               | 8.2%                       
| |                                                                         |                                         |                            
| | George T. Pjura
3703 Stonebridge Drive
Cape Girardeau, Missouri 63703   | 1,272,058                               | 6.5%                       
| |                                                                         |                                         |                            
| | Kurt Wilkin (7)
5080 Spectrum Drive, Suite 310W
Addison, Texas 75001    | 1,047,719                               | 5.3%                       
| |                                                                         |                                         |                            
| | Brett Lawson (7)
5080 Spectrum Drive, Suite 310W
Addison, Texas 75001   | 1,047,719                               | 5.3%                       
| |                                                                         |                                         |                            
| | Executive Officers and Directors:                                       |                                         |                            
| | Clark R. "Dub" Doyal                                                    | 4,915,025                               | 25.7%                      
| | James D. (Jim) Schell (8)                                               | 1,854,083                               | 9.6%                       
| |                                                                         |                                         |                            
| | Gary J. Davis (3) (4)
3811 Bee Cave Rd, Suite 210
Austin, Texas 78746   | 2,931,387                               | 15.3%                      
| |                                                                         |                                         |                            
| | Bryan T. Forman (3) (5)
6836 Bee Cave Rd, Suite 242
Austin, Texas 78746 | 3,182,907                               | 16.1%                      
| |                                                                         |                                         |                            
| | All Executive Officers and Directors as a Group (4 persons) (3)         | 10,980,864                              | 55.0%                      
| |                                                                         |                                         |                            



|
|



|(1) | Pursuant to the rules of the Securities and Exchange Commission, a person or group is deemed to have "beneficial ownership" of any shares with regard to which such person or group has or shares voting or investment power or has or shares the right to acquire such power within 60 days of December 31, 2005, such as pursuant to the conversion or exchange of securities or the exercise of stock options or warrants.  For purposes of computing the percentage of outstanding shares held by any person or group of persons, shares that such person or group has the right to acquire within 60 days of December 31, 2005 are deemed to be outstanding for the purpose of computing the percentage ownership of such person or group but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person or group.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(2) | Based on 19,095,062 shares of common stock outstanding as of December 31, 2005. Percentage ownership is calculated separately for each person on the basis of the actual number of outstanding shares as of December 31, 2005 plus the number of shares issuable to that owner on exercise of options and warrants and the number of common shares into which the owner's preferred shares are convertible, and dividing by the total number of outstanding shares plus that owner's option, warrant and preferred conversion shares. Each Series A and Series B Preferred Share is convertible into five (5) shares of Common Stock. Each Warrant is convertible into one (1) share of Common Stock.                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(3) | Mr. Davis and Mr. Forman are the President and Managing Member, respectively, of two co-general partners of ADS Equity Partners, L.P. ("ADS Equity"), which owns 1,902,538 shares of ADS Media common stock. Because they have joint power to vote the shares owned by ADS Equity, each of them may be deemed to be beneficial owner of all the common stock owned by ADS Equity pursuant to Rule 13d-3 promulgated under the Securities and Exchange Act of 1934, as amended. Accordingly, the 1,902,538 shares of ADS Media that ADS Equity owns are included in the number of shares both Mr. Davis and Mr. Forman own and in the number of shares owned by all officers and directors as a group.                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(4) | Includes 90,000 shares issuable on the exercise of options, 590,571 shares held by partnerships in which Mr. Davis is a partner, and 264,278 shares held by a corporation of which Mr. Davis is the sole shareholder.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(5) | Includes 25,000 shares to be issued to Mr. Forman for services rendered and 617,332 shares issuable on the exercise of warrants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(6) | Includes 1,674,405 shares and warrants to purchase up to 35,076 shares held by partnerships in which Mr. Gray is a partner.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(7) | Mr. Wilkin and Mr. Lawson are partners in partnerships which own 460,416 shares and warrants to purchase up to 431,747 shares of ADS Media common stock. Because they have joint power to vote the shares owned by the partnerships, each of them may be deemed to be beneficial owner of all the common stock and warrants owned by the partnerships pursuant to Rule 13d-3 promulgated under the Securities and Exchange Act of 1934, as amended. Accordingly, the 460,416 shares and warrants to purchase up to 431,747 shares of ADS Media that the partnerships own are included in the number of shares both Mr. Wilkin and Mr. Lawson own.                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(8) | Includes 155,556 shares which Mr. Schell has the right to acquire on the exercise of warrants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

|Item 12. Certain Relationships and Related Transactions.                                                                                                                                                                                                                                                                                                                           
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                   
|From time to time in 2005, ADS Media issued securities to partnerships, in which 5% shareholders are partners, as detailed in Item 5 - Market for Common Equity and Related Stockholder Matters - Recent Sales of Unregistered Securities.                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                   
|During the years ended December 31, 2005 and 2004, ADS Media purchased $0 and $2,740, respectively, in goods and services from Laser Dimensions, Inc., a company in which two of the officers of ADS Media own a non-controlling interest. As of both December 31, 2005 and 2004, ADS Media owed Laser Dimensions $0.                                                              
|In 2004, ADS Media issued a short-term note payable for $18,667 to an officer of the company. In connection with obtaining this short-term debt financing, ADS Media also issued the officer warrants to purchase up to 155,556 shares of common stock at an exercise price of $0.12 per share. ADS Media repaid the principal and interest in full on this note in 2004.          
|                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, ADS Media issued a short-term note payable for $60,000 to a 5% shareholder of the company. In connection with obtaining this short-term debt financing, ADS Media also issued the shareholder warrants to purchase up to 500,000 shares of common stock at an exercise price of $0.12 per share. ADS Media repaid the principal and interest in full on this note in 2004.
|                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, the Company issued a note payable for $20,000 to an officer of the company. Principal and interest are payable monthly beginning June 15, 2005, until paid in full.                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                   
|In 2005, ADS Media issued 145,846 shares of common stock, at a price of $0.13 per share, to a consultant's partnership, in which two 5% shareholders are partners, in exchange for professional services totaling $18,960.                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                   
|Item 13. Exhibits                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                   



|31.1+ | Certification of the Chief Executive Officer and Chief Financial Officer of ADS Media required by Section 302 of the Sarbanes-Oxley Act of 2002                              
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                              
|32.1+ | Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|      |                                                                                                                                                                              
|+     | Filed with this Form 10-KSB                                                                                                                                                  
|      |                                                                                                                                                                              

|Item 14. Principal Accountant Fees and Services.                                     
|-------------------------------------------------------------------------------------
|                                                                                     
|Audit Fees                                                                           
|                                                                                     
|Our independent auditors for fiscal 2004 and 2005 were Sprouse & Anderson, LLP.      
|                                                                                     
|The fees billed to ADS Media by Sprouse & Anderson, LLP are shown in the table below.
|                                                                                     

|                   | Year EndedDecember 31, |        
|------------------ | ---------------------- | -------
|                   | 2005                   | 2004   
|                   |                        |        
|Audit fees         | $25,500                | $20,550
|Audit-related fees | -                      | -      
|Tax fees           | 2,000                  | 2,000  
|All other fees     | -                      | -      
|                   | $27,500                | $22,550
|                   |                        |        



|Audit fees consist of fees billed for professional services for the audit of ADS Media's annual financial statements, reviews of the financial statements included in ADS Media's quarterly reports and services that are normally provided in connection with statutory and regulatory filings.                                                                                      
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                      
|Audit-related fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of ADS Media's consolidated financial statements and are not reported under "Audit Fees."                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                      
|Tax fees consist of fees billed for professional services for tax compliance, tax advice and tax planning.                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                      
|All other fees consist of fees for products and services other than for services reported above.                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                      
|Pre-Approval Policy and Procedures                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                      
|It is the Board of Director's policy to pre-approve all services provided by Sprouse & Anderson, LLP. All services provided by Sprouse & Anderson, LLP during the years ended December 31, 2005 and 2004 were pre-approved by the Board of Directors.                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                      
|As of the date of this filing, ADS Media's current policy is to not engage Sprouse & Anderson, LLP to provide, among other things, bookkeeping services, appraisal or valuation services, or internal audit services. The policy provides that ADS Media engage Sprouse & Anderson, LLP to provide audit, tax, and other assurance services, such as review of SEC reports or filings.
|                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                      
|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.                                                                                                                                                                      



|Date: | April 12, 2006 | ADS Media Group, Inc.  
|----- | -------------- | -----------------------
|      |                |                        
|      |                | By: /s/ Clark R. Doyal 
|      |                | Clark R. Doyal         
|      |                | Chief Executive Officer
|      |                |                        



|Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                       



|Name                | Title                                        | Date          
|------------------- | -------------------------------------------- | --------------
|                    |                                              |               
|/s/ Clark R. Doyal  | Chairman, Chief Executive Officer,           | April 12, 2006
|Clark R. Doya       | President and Director (Principal Executive, |               
|                    | Financial and Accounting Officer)            |               
|                    |                                              |               
|/s/ James D. Schell | Vice President, Secretary, Treasurer and     | April 12, 2006
|James D. Schell     | Director                                     |               
|                    |                                              |               
|/s/ Gary J. Davis   | Director                                     | April 12, 2006
|Gary J. Davis       |                                              |               
|                    |                                              |               
|/s/ Bryan T. Forman | Director                                     | April 12, 2006
|Bryan T. Forman     |                                              |               
|                    |                                              |               
|                    |                                              |               





|INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
|------------------------------------------
|                                          



|INDEPENDENT AUDITORS' REPORT OF SPROUSE & ANDERSON LLP    | F-2
|--------------------------------------------------------- | ---
|                                                          |    
|CONSOLIDATED BALANCE SHEETS                               | F-3
|                                                          |    
|CONSOLIDATED STATEMENTS OF OPERATIONS                     | F-5
|                                                          |    
|CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT) | F-6
|                                                          |    
|CONSOLIDATED STATEMENTS OF CASH FLOWS                     | F-7
|                                                          |    
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                | F-9
|                                                          |    
|                                                          |    























































|   
|---
|   
|   
|   
|   
|F-1
|   



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|INDEPENDENT AUDITORS' REPORT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|To the Board of Directors and Shareholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|ADS Media Group, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|San Antonio, Texas                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|We have audited the accompanying consolidated balance sheets of ADS Media Group, Inc. (the "Company") as of December 31, 2005 and 2004, and the related consolidated statements of operations, shareholders' equity (deficit) and cash flows for the years then ended.  These consolidated financial statements are the responsibility of the Company's management.  Our responsibility is to express an opinion on these financial statements based on our audits.                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of ADS Media Group, Inc. as of December 31, 2005 and 2004, 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.                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Sprouse & Anderson, LLP                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Austin, Texas                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|March 8, 2006                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|F-2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       



|ADS MEDIA GROUP, INC.      
|---------------------------
|CONSOLIDATED BALANCE SHEETS
|                           

|                                                                                                       | December 31, 
|------------------------------------------------------------------------------------------------------ | -------------
|                                                                                                       | 2005         
|                                                                                                       |              
|CURRENT Assets                                                                                         |              
|Cash and cash equivalents                                                                              | $     446,142
|Accounts receivable (net of allowance for doubtful accounts of $51,281 in 
  2005 and $42,449 in 2004) | 500,122      
|Prepaid expenses                                                                                       | 57,172       
|Other current assets                                                                                   | 344          
|                                                                                                       |              
|Total current assets                                                                                   | 1,003,780    
|                                                                                                       |              
|PROPERTY AND EQUIPMENT                                                                                 |              
|Furniture and fixtures                                                                                 | 24,931       
|Computer equipment                                                                                     | 51,975       
|Less: accumulated depreciation                                                                         | (61,135)     
|                                                                                                       |              
|Total property and equipment, net                                                                      | 15,771       
|                                                                                                       |              
|GOODWILL                                                                                               | 250,000      
|                                                                                                       |              
|OTHER ASSETS                                                                                           | 6,922        
|                                                                                                       |              
|TOTAL ASSETS                                                                                           | $1,276,473   
|                                                                                                       |              
|                                                                                                       |              
|                                                                                                       |              































|                                                                                       
|---------------------------------------------------------------------------------------
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|F-3                                                                                    
|                                                                                       
|                                                                                       



|ADS MEDIA GROUP, INC.                  
|---------------------------------------
|CONSOLIDATED BALANCE SHEETS (continued)
|                                       



|                                                                                                                                     | December 31,   
|------------------------------------------------------------------------------------------------------------------------------------ | ---------------
|                                                                                                                                     | 2005           
|                                                                                                                                     |                
|CURRENT LIABILITIES                                                                                                                  |                
|Accounts payable                                                                                                                     | $       271,751
|Customer advance payments                                                                                                            | 11,050         
|Accrued salaries and wages                                                                                                           | 907,785        
|Accrued liabilities                                                                                                                  | 80,855         
|Accrued liabilities - related party                                                                                                  | 24,514         
|Due to officer - related party                                                                                                       | 2,942          
|Notes payable                                                                                                                        | 135,653        
|Notes payable - related parties, net of discount                                                                                     | 84,499         
|Other current liabilities                                                                                                            | 1,739          
|Obligations under capital leases                                                                                                     | 4,841          
|                                                                                                                                     |                
|Total current liabilities                                                                                                            | 1,525,629      
|                                                                                                                                     |                
|Obligations under capital leases, long-term                                                                                          | 4,052          
|                                                                                                                                     |                
|Total liabilities                                                                                                                    | 1,529,681      
|                                                                                                                                     |                
|Commitments and contingencies                                                                                                        |                
|                                                                                                                                     |                
|SHAREholders' equity (DEFICIT)                                                                                                       |                
|Preferred stock series A, $0.001 par value, 40,000 shares authorized; 13,616 and 13,616 shares issued and outstanding, respectively  | 14             
|Preferred stock series B, $0.001 par value, 6,000 shares authorized; 166 and 166 shares issued and outstanding, respectively         | -              
|Common stock, $0.001 par value, 100,000,000 shares authorized; 19,095,062 and 18,892,073 shares issued and outstanding, respectively | 19,095         
|Additional paid-in capital                                                                                                           | 2,126,685      
|Accumulated deficit                                                                                                                  | (2,399,002)    
|                                                                                                                                     |                
|Total shareholders' equity (deficit)                                                                                                 | (253,208)      
|                                                                                                                                     |                
|TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)                                                                                 | $1,276,473     
|                                                                                                                                     |                
|                                                                                                                                     |                











|                                                                                       
|---------------------------------------------------------------------------------------
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|F-4                                                                                    
|                                                                                       
|                                                                                       



|ADS MEDIA GROUP, INC.                
|-------------------------------------
|CONSOLIDATED STATEMENTS OF OPERATIONS
|                                     



|                                                          | For the year endedDecember 31,
|--------------------------------------------------------- | ------------------------------
|                                                          | 2005                          
|                                                          |                               
|REVENUES                                                  | $    5,477,086                
|                                                          |                               
|COST OF GOODS SOLD                                        | 3,554,352                     
|                                                          |                               
|Gross profit                                              | 1,922,734                     
|                                                          |                               
|SELLING, ADMINISTRATIVE AND OTHER
   OPERATING EXPENSES   | 1,587,877                     
|                                                          |                               
|Income from operations                                    | 334,857                       
|                                                          |                               
|OTHER INCOME (EXPENSE)                                    |                               
|Interest expense                                          | (36,685)                      
|Interest and other income                                 | -                             
|                                                          |                               
|Total other income (expense)                              | (36,685)                      
|                                                          |                               
|Income before income taxes                                | 298,172                       
|                                                          |                               
|INCOME TAXES                                              | -                             
|                                                          |                               
|NET INCOME                                                | $298,172                      
|                                                          |                               
|                                                          |                               
|NET INCOME PER SHARE, basic                               | $0.02                         
|                                                          |                               
|WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING,
    basic  | 19,008,175                    
|                                                          |                               
|                                                          |                               
|NET INCOME PER SHARE, diluted                             | $0.02                         
|                                                          |                               
|WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING,
   diluted | 19,077,085                    
|                                                          |                               
|                                                          |                               
|                                                          |                               









|                                                                                       
|---------------------------------------------------------------------------------------
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|F-5                                                                                    
|                                                                                       
|                                                                                       

|ADS MEDIA GROUP, INC.                                    
|---------------------------------------------------------
|CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)
|                                                         





|                                                                  | Preferred Stock | Common Stock | Additional |            |             
|----------------------------------------------------------------- | --------------- | ------------ | ---------- | ---------- | ------------
|                                                                  |                 |              |            |            | Paid-In     
|                                                                  | Shares          | Par Value    | Shares     | Par Value  | Capital     
|Balance at December 31, 2003                                      | 13,782          | $         14 | 18,858,900 | $   18,859 | $  2,033,534
|                                                                  |                 |              |            |            |             
|Common stock issued for services                                  | -               | -            | 33,173     | 33         | 4,279       
|Warrants issued for services                                      | -               | -            | -          | -          | 9,031       
|Conversion of accounts payable into 
     warrants                | -               | -            | -          | -          | 17,662      
|Warrants issued in connection with 
     obtaining debt financing | -               | -            | -          | -          | 35,422      
|Net income for the year                                           | -               | -            | -          | -          | -           
|                                                                  |                 |              |            |            |             
|Balance at December 31, 2004                                      | 13,782          | $         14 | 18,892,073 | $   18,892 | $  2,099,928
|                                                                  |                 |              |            |            |             
|Common stock issued for services                                  | -               | -            | 145,846    | 146        | 18,814      
|Conversion of accounts payable into 
     common stock            | -               | -            | 57,143     | 57         | 7,943       
|Net income for the year                                           | -               | -            | -          | -          | -           
|                                                                  |                 |              |            |            |             
|Balance at December 31, 2005                                      | 13,782          | $         14 | 19,095,062 | $   19,095 | $  2,126,685
|                                                                  |                 |              |            |            |             
|                                                                  |                 |              |            |            |             

|                                                                                       
|---------------------------------------------------------------------------------------
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|F-6                                                                                    





|ADS MEDIA GROUP, INC.                
|-------------------------------------
|CONSOLIDATED STATEMENTS OF CASH FLOWS
|                                     



|                                                                                       | For the year endedDecember 31,
|-------------------------------------------------------------------------------------- | ------------------------------
|                                                                                       | 2005                          
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                  |                               
|Net income                                                                             | $       298,172               
|Adjustments to reconcile net income to net cash provided by operating
     activities: |                               
|Bad debt expense                                                                       | 26,218                        
|Depreciation expense                                                                   | 10,956                        
|Issuance of common stock and warrants for services                                     | 18,960                        
|Issuance of warrants in connection with obtaining debt financing                       | 3,000                         
|(Increase) decrease in assets:                                                         |                               
|Accounts receivable                                                                    | (84,978)                      
|Prepaid expenses and other assets                                                      | (8,994)                       
|Increase (decrease) in liabilities:                                                    |                               
|Accounts payable and accrued expenses                                                  | 104,510                       
|Customer advance payments                                                              | (69,734)                      
|                                                                                       |                               
|Total adjustments                                                                      | (62)                          
|                                                                                       |                               
|Net cash provided by operating activities                                              | 298,110                       
|                                                                                       |                               
|CASH FLOW FROM INVESTING ACTIVITIES:                                                   |                               
|Capital expenditures                                                                   | (3,944)                       
|                                                                                       |                               
|Net cash used in investing activities                                                  | (3,944)                       
|                                                                                       |                               
|CASH FLOW FROM FINANCING ACTIVITIES:                                                   |                               
|Proceeds from notes payable                                                            | -                             
|Payments on notes payable                                                              | (7,347)                       
|Proceeds from notes payable - related parties                                          | -                             
|Payments on notes payable - related parties                                            | (45,518)                      
|Payments on capital lease obligations                                                  | (4,019)                       
|                                                                                       |                               
|Net cash provided by (used in) financing activities                                    | (56,884)                      
|                                                                                       |                               
|NET INCREASE IN CASH AND CASH EQUIVALENTS                                              | 237,282                       
|                                                                                       |                               
|CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                         | 208,860                       
|                                                                                       |                               
|CASH AND CASH EQUIVALENTS, END OF PERIOD                                               | $446,142                      
|                                                                                       |                               
|                                                                                       |                               







|                                                                                       
|---------------------------------------------------------------------------------------
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|F-7                                                                                    
|                                                                                       





|ADS MEDIA GROUP, INC.                            
|-------------------------------------------------
|CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
|                                                 



|                                                                 | For the year endedDecember 31,
|---------------------------------------------------------------- | ------------------------------
|                                                                 | 2005                          
|SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:               |                               
|                                                                 |                               
|Cash paid for interest                                           | $         16,243              
|                                                                 |                               
|Cash paid for income taxes                                       | $                -            
|                                                                 |                               
|NON-CASH INVESTING AND FINANCING ACTIVITY:                       |                               
|                                                                 |                               
|Issuance of common stock and warrants in exchange for services   | $         18,960              
|                                                                 |                               
|Issuance of warrants in connection with obtaining debt financing | $           3,000             
|                                                                 |                               
|Conversion of accrued liabilities to notes payable               | $                -            
|                                                                 |                               
|Conversion of accounts payable into common stock and warrants    | $           8,000             
|                                                                 |                               
|Application of security deposit to notes payable                 | $           6,955             
|                                                                 |                               
|Property acquired under capital lease obligations                | $           8,359             
|                                                                 |                               
|                                                                 |                               







































|                                                                                       
|---------------------------------------------------------------------------------------
|                                                                                       
|                                                                                       
|The accompanying notes are an integral part of these consolidated financial statements.
|                                                                                       
|                                                                                       
|F-8                                                                                    
|                                                                                       



|NOTE A - GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Description of Business and Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|ADS Media Group, Inc. (the "Company" or "ADS Media"), through its wholly owned subsidiary Alternative Delivery Solutions, Inc. ("ADS"), is a leading provider of turnkey direct marketing support services, with an emphasis on alternate (i.e., door to door) delivery.  Services provided include the creation, packaging and delivery of direct marketing materials (e.g., brochures, coupons, advertisements, etc.) to targeted audiences. In addition to alternate delivery, ADS provides its clients direct marketing, printing, list procurement, database management and fulfillment services, primarily through outsourcing arrangements with third party vendors.  The Company is based in San Antonio, Texas and serves customers and markets throughout the United States.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|ADS Media, formerly known as National Health and Safety Corporation ("NHLT"), is a Utah corporation incorporated on March 23, 1989. ADS was incorporated in Texas on October 22, 2001 under the name Distributel Media Distribution, Inc. The name was changed to Alternative Delivery Solutions, Inc. in 2002. On January 31, 2003, ADS was acquired by NHLT in an exchange offer in which all of the ADS shareholders transferred all of their shares of ADS to NHLT in exchange for shares of NHLT's common stock. For accounting purposes this combination was treated as a "reverse acquisition" in accordance with APB 16, with ADS treated as the acquiring company. After the exchange, the former ADS shareholders owned 15,000,000 shares (75%) of the outstanding common stock of NHLT, including shares issuable upon exercise of outstanding warrants.  The remaining 4,900,002 shares (25%) were owned by the pre-stock exchange NHLT shareholders, including shares issuable upon the conversion of outstanding preferred stock and the exercise of outstanding options. The Company acquired the 4,900,002 shares of NHLT for a total value of $700,000, which represented the excess purchase price over fair value of assets acquired in the acquisition of ADS by NHLT and was recorded as goodwill.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Principles of Consolidation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The accompanying consolidated financial statements include the financial statements of the Company and its wholly owned subsidiary, ADS. All intercompany balances and transactions have been eliminated in consolidation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Cash and Cash Equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Cash and cash equivalents include cash on hand and on deposit and highly liquid debt instruments with original maturities of three months or less. At December 31, 2005 and 2004, cash and cash equivalents exceed FDIC limits by $297,012 and $204,069, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Concentration of Credit Risk and Accounts Receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company extends unsecured credit in the normal course of business to virtually all of its customers. Management has provided an allowance for doubtful accounts which reflects its opinion of amounts which may ultimately become uncollectible. In the event of non-performance of accounts receivable, the maximum exposure to the Company is the recorded amount shown on the balance sheets. Concentration of credit risk and failure to collect accounts receivable have not presented significant problems to the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Property and Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Property and equipment are recorded at cost. Depreciation is computed on property and equipment using the straight-line method over the expected useful lives of the assets, which are generally three years for computer equipment and five years for furniture and fixtures. Repairs and maintenance costs are expensed as incurred and improvements are capitalized. Depreciation expense for the years ended December 31, 2005 and 2004 was $10,956 and $17,185, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Goodwill represents the excess purchase price over fair value of assets acquired in the acquisition of ADS by NHLT on January 31, 2003 in the amount of $700,000. Goodwill is being accounted for in accordance with Statement of Financial Accounting Standards ("SFAS") No. 142 "Goodwill and Other Intangible Assets." This pronouncement decrees that goodwill be reviewed for impairment rather than amortized, on an annual basis, beginning on January 1, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company assesses the carrying value of goodwill annually and when factors are present that indicate an impairment may have occurred. Goodwill is considered impaired and a loss is recognized when its carrying value exceeds its implied fair value. Factors that are considered important which could trigger an impairment review include the following:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|-	significant underperformance relative to expected historical or projected future operating results;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|-	significant changes in the manner or use of the acquired assets or the strategy for our overall business;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|-	significant negative industry or economic trends;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|-	significant decline in stock price for a sustained period; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-	our market capitalization relative to net book value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Each year the Company assesses the realizability of the recorded goodwill and other intangibles in accordance with SFAS No. 142. At December 31, 2003, the analysis indicated that goodwill of $450,000 was impaired. As a result, for the year ended December 31, 2003, the Company impaired its stated goodwill value by $450,000 from $700,000 to $250,000. At December 31, 2005 and 2004, the analysis indicated that there was no further impairment of goodwill. The Company will continue to test on a consistent measurement date unless events occur or circumstances change between annual impairment tests that would more likely than not reduce fair value below its carrying value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Revenue Recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company recognizes revenue upon completion of a project for fulfillment revenues, upon mailing of product for direct mail revenues and upon delivery of product to consumer for alternative delivery revenue. Services are generally not subject to "rights of return" unless the Company did not perform services in accordance with the contract.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Advertising                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Advertising costs are expensed as incurred. At December 31, 2005 and 2004, advertising expenses were $9,642 and $900, respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company records income taxes in accordance with SFAS No. 109 "Accounting for Income Taxes." Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amount of existing assets and liabilities and their respective tax bases, including operating loss carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Stock-Based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company accounts for stock-based employee compensation arrangements in accordance with the provisions of Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees," and complies with the disclosure provisions of SFAS No. 123, "Accounting for Stock Based Compensation." Under APB Opinion No. 25, compensation expense would be recorded on the date of grant only if the current market price of the underlying stock exceeded the exercise price. SFAS No. 123, as amended by SFAS No. 148, "Accounting for Stock-Based Compensation-Transition and Disclosure-an amendment of FASB Statement No. 123," established accounting and disclosure requirements using a fair value-based method of accounting for stock-based employee compensation plans. As allowed by SFAS No. 123 (as amended), the Company has elected to continue to apply the intrinsic value-based method of accounting described above, and has adopted the disclosure requirements of SFAS No. 123 (as amended).                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Company uses the intrinsic value method to account for stock-based employee compensation. During 2005 and 2004, the Company did not incur any compensation cost under APB No. 25 for options granted under the Plan. For purposes of pro forma disclosure, the estimated fair value of the option is amortized to expense over the option's vesting period.  Had the Company determined compensation cost consistent with SFAS No. 123 and SFAS No. 148 using the fair value method, the Company's net income and net income per common share for the years ended December 31, 2005 and 2004 would approximate the pro forma amounts as shown below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

|                                                                                                          | For the Year Ended 
December 31,
|--------------------------------------------------------------------------------------------------------- | --------------------------------
|                                                                                                          | 2005                            
|                                                                                                          |                                 
|Net income, as reported                                                                                   | $     298,172                   
|Deduct:  Total stock-based employee
    compensation expense determined under 
   fair value based method | -                               
|Pro forma net income                                                                                      | $     298,172                   
|                                                                                                          |                                 
|Net income per share:                                                                                     |                                 
|Basic and diluted -                                                                                       |                                 
|As reported                                                                                               | $           0.02                
|                                                                                                          |                                 
|Pro forma                                                                                                 | $           0.02                
|                                                                                                          |                                 
|                                                                                                          |                                 

|The effects of applying SFAS No. 123 in this pro forma disclosure are not indicative of future amounts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option pricing-model. There were no stock option grants in 2004 or 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The Company accounts for equity instruments issued to non-employees in accordance with the provisions of SFAS No. 123 and Emerging Issues Task Force ("EITF") Issue No. 96-18, "Accounting for Equity Instruments That Are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services." All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty's performance is complete or the date on which it is probable that performance will occur.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Fair Value of Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The carrying value of cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short-term nature. The recorded balance of notes payable is estimated to be the fair value since the rates specified in the notes approximate rates the Company could currently obtain on debt with similar terms.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Use of Estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|The preparation of the Company's consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Reclassification                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Certain amounts have been reclassified from the prior year for comparative purposes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Recently Issued Accounting Pronouncements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|In December 2004, the FASB issued SFAS No. 123R, "Share-Based Payment". SFAS No. 123R is a revision of SFAS No. 123, "Accounting for Stock Based Compensation," and supersedes APB Opinion No. 25. Among other items, SFAS No. 123R eliminates the use of APB 25 and the intrinsic value method of accounting, and requires that the compensation cost relating to share-based payment transactions be recognized in financial statements based on the provisions of SFAS 123 issued in 1995. The Company currently accounts for stock-based compensation using APB 25 and discloses pro forma compensation expense, if applicable, by calculating the stock option grants' fair value using the Black-Scholes model and disclosing the impact on net income (loss) and net income (loss) per share in a Note to the Consolidated Financial Statements. Upon adoption, pro forma disclosure will no longer be an alternative. The effective date of SFAS No. 123R for the Company is the first quarter of 2006. The adoption of this statement will have the effect of decreasing net income and net income per share and increasing net loss and net loss per share as compared to what would be reported under the current requirements. These future amounts cannot be precisely estimated because they depend on, among other things, the number of options issued in the future, and accordingly, the Company has not determined the impact of adoption of this statement on its results of operations.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|NOTE B - NOTES PAYABLE                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Notes payable consist of the following at December 31, 2005 and 2004:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

|                                                                                                                                                                                                                                                                                                                                                 |  | December 31,
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------
|                                                                                                                                                                                                                                                                                                                                                 |  | 2005        
|Uncollateralized note payable bearing interest at 10%, principal and interest payable in full upon maturity, matured April 1, 2004. Renewed May 1, 2004, principal and interest payable in full upon maturity, matured May 1, 2005. Renewed effective May 1, 2005, principal and interest payable in full upon maturity, matures on May 1, 2006. |  | 15,000      
|                                                                                                                                                                                                                                                                                                                                                 |  |             
|Uncollateralized note payable bearing interest at 10%, principal and interest payable in full upon maturity, matured April 1, 2004. Renewed May 1, 2004, principal and interest payable in full upon maturity, matured May 1, 2005. Renewed effective May 1, 2005, principal and interest payable in full upon maturity, matures on May 1, 2006. |  | 50,000      
|                                                                                                                                                                                                                                                                                                                                                 |  |             
|Uncollateralized note payable bearing interest at 10%, principal and interest payable in full upon maturity, matured April 1, 2004. Renewed May 1, 2004, principal and interest payable in full upon maturity, matured May 1, 2005. Renewed effective May 1, 2005, principal and interest payable in full upon maturity, matures on May 1, 2006. |  | 30,000      
|                                                                                                                                                                                                                                                                                                                                                 |  |             
|Uncollateralized note payable bearing interest at 5.5%, principal and interest payable quarterly beginning April 1, 2004 and in full upon maturity, matured February 1, 2005. Renewed effective February 1, 2005, principal and interest payable in monthly installments of $1,500 beginning September 1, 2005 until paid in full.               |  | 40,653      
|Notes payable                                                                                                                                                                                                                                                                                                                                    |  | $135,653    
|                                                                                                                                                                                                                                                                                                                                                 |  |             

|Notes payable - related parties, net of debt discount, consist of the following at December 31, 2005 and 2004:
|--------------------------------------------------------------------------------------------------------------
|                                                                                                              

|                                                                                                                                                                                                                                                                                                                                                                                                  |  | December 31,
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------
|                                                                                                                                                                                                                                                                                                                                                                                                  |  | 2005        
|Uncollateralized note payable to a 5% shareholder bearing interest at 6%, principal and interest payable in full upon maturity, matured September 23, 2002. Renewed May 1, 2004, bearing interest at 10%, principal and interest payable in full upon maturity, matured May 1, 2005. Renewed effective May 1, 2005, principal and interest payable in full upon maturity, matures on May 1, 2006. |  | $   40,000  
|                                                                                                                                                                                                                                                                                                                                                                                                  |  |             
|Uncollateralized note payable to a 5% shareholder bearing interest at 10%, principal and interest payable in full upon maturity, matured April 1, 2004. Renewed May 1, 2004, principal and interest payable in full upon maturity, matured May 1, 2005. Renewed effective May 1, 2005, principal and interest payable in full upon maturity, matures on May 1, 2006.                              |  | 40,000      
|                                                                                                                                                                                                                                                                                                                                                                                                  |  |             
|Uncollateralized note payable to a partnership, in which 5% shareholders are partners, bearing interest at 10%, principal and interest payable monthly beginning December 15, 2004, until paid in full, net of debt discount of $3,000 at December 31, 2004.                                                                                                                                      |  | -           
|                                                                                                                                                                                                                                                                                                                                                                                                  |  |             
|Uncollateralized note payable to officer bearing interest at 10%, principal and interest payable monthly beginning June 15, 2005, until paid in full approximately February 15, 2006.                                                                                                                                                                                                             |  | 4,499       
|Notes payable - related parties, net of debt discount                                                                                                                                                                                                                                                                                                                                             |  | $84,499     
|                                                                                                                                                                                                                                                                                                                                                                                                  |  |             

|Since its inception the Company has issued notes payable primarily for working capital purposes.                                               
|-----------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                               
|NOTE C - CAPITAL LEASE OBLIGATIONS                                                                                                             
|                                                                                                                                               
|The Company is leasing certain equipment under capital leases. Capital leases payable at December 31, 2005 and 2004 consisted of the following:
|                                                                                                                                               

|                                                                      | 2005           | 2004         
|--------------------------------------------------------------------- | -------------- | -------------
|Capital leases for equipment due in monthly installments through 2008 | $       10,550 | $       5,009
|                                                                      |                |              
|Less interest                                                         | 1,657          | 456          
|Less current portion                                                  | 4,841          | 2,342        
|                                                                      |                |              
|Obligations under capital leases, long-term                           | $4,052         | $2,211       
|                                                                      |                |              



|Scheduled maturities for capital lease obligations for the years ended December 31, are as follows:
|---------------------------------------------------------------------------------------------------
|                                                                                                   





| | 2006  | $        4,841
| | ----- | --------------
| | 2007  | 3,165         
| | 2008  | 887           
| |       |               
| | Total | $8,893        
| |       |               



|The cost and accumulated depreciation of assets acquired under capital leases at December 31, 2005 and 2004, are as follows:
|----------------------------------------------------------------------------------------------------------------------------
|                                                                                                                            

|                                         | 2005           | 2004         
|---------------------------------------- | -------------- | -------------
|Cost                                     | $       18,986 | $      10,627
|Accumulated depreciation                 | 11,045         | 6,513        
|                                         |                |              
|Net leased property under capital leases | $7,941         | $4,114       
|                                         |                |              



|NOTE D - PREFERRED STOCK                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Series A                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|The Company is authorized to issue up to 40,000 shares of Series A Preferred Stock, par value $.001 per share, of which 13,616 shares were issued and outstanding as of December 31, 2005. Each Series A share has a $1.00 liquidation preference and preference over Series B Preferred Stock, Common Stock and all other series of stock ranking junior to Series A. Each share of Series A is convertible, at the option of the holder, into five (5) shares of Common Stock at such times and in such amounts as stated in the Certificate of Designation. The holders of Series A stock are entitled to vote together with the holders of Series B and Common Stock and are entitled to one (1) vote for each share of Common Stock which would be held by them if all of their shares of Series A were converted into shares of Common Stock.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Series B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|The Company is authorized to issue up to 6,000 shares of Series B Preferred Stock, par value $.001 per share, of which 166 shares were issued and outstanding as of December 31, 2005. Each Series B share has a $1.00 liquidation preference that is inferior to Series A but in preference to Common Stock and all other series of stock ranking junior to Series B. Each Series B share is convertible at the option of the holder into five (5) shares of Common Stock at such times and in such amounts as stated in the Certificate of Designation. The holders of Series B stock are entitled to vote together with the holders of Series A and Common Stock and are entitled to one (1) vote for each share of Common Stock which would be held by them if all of their shares of Series B were converted into shares of Common Stock.     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|NOTE E - Common stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|All of these securities were issued in privately negotiated transactions effected in reliance on the exemption contained in Section 4(2) of the Securities Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, the Company issued 33,173 shares of common stock, at a price of $0.13 per share, in exchange for professional services totaling $4,312. In 2005, the Company issued 145,846 shares of common stock, at a price of $0.13 per share, in exchange for professional services totaling $18,960.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2005, the Company issued 57,143 shares of common stock, at a price of $0.14 per share, in exchange for reduction of accounts payable totaling $8,000.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|NOTE F - STOCK WARRANTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, the Company issued warrants to purchase up to 312,500 shares of common stock in exchange for professional services. These warrants enable the holder to purchase shares of the Company's common stock at an exercise price of $0.12 per share through 2009. The company recorded $9,031 in expenses related to the issuance of these warrants.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, the Company issued warrants to purchase up to 1,570,833 shares of common stock in connection with short-term loans to the company. These warrants enable the holder to purchase shares of the Company's common stock at an exercise price of $0.12 per share through 2009. The company recorded $35,422 in additional paid in capital related to the issuance of these warrants.                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2004, the Company issued warrants to purchase up to 98,120 shares of common stock in exchange for reductions of accounts payable totaling $17,662. These warrants enable the holder to purchase shares of the Company's common stock at an exercise price of $0.18 per share through 2009.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|In 2005, the Company issued no warrants to purchase shares of common stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|The following is a summary of outstanding warrants:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                



|                                          | **Number ofShares** | **Exercise Price**
|----------------------------------------- | ------------------- | ------------------
|Warrants outstanding at January 1, 2004   | 1,075,904           | $      0.12 - 0.16
|                                          |                     |                   
|Granted                                   | 1,981,453           | $      0.12 - 0.18
|Exercised                                 | -                   |                   
|Canceled                                  | -                   |                   
|                                          |                     |                   
|Warrants outstanding at December 31, 2004 | 3,057,357           | $      0.12 - 0.18
|                                          |                     |                   
|Granted                                   | -                   |                   
|Exercised                                 | -                   |                   
|Canceled                                  | -                   |                   
|                                          |                     |                   
|Warrants outstanding at December 31, 2005 | 3,057,357           | $      0.12 - 0.18
|                                          |                     |                   
|                                          |                     |                   



|NOTE G - STOCK OPTIONS                                                                                                                                                                                                                                                                                                                                                                                                    
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Prior to completion of the exchange offer, on January 30, 2003, NHLT's shareholders approved the 2002 Employees and Consultants Stock Option Plan, granting 250,000 options (25,000,000 pre-reverse stock split options) to acquire shares of the Company's common stock at an exercise price of $0.10 per share ($0.001 per share pre-reverse stock split). The options vested immediately and expire on October 6, 2007.
|                                                                                                                                                                                                                                                                                                                                                                                                                          
|The following is a summary of outstanding stock options:                                                                                                                                                                                                                                                                                                                                                                  

|                                         | **Number ofShares** | **Weighted 
Average Exercise Price**
|---------------------------------------- | ------------------- | ------------------------------------
|Options outstanding at January 1, 2004   | 250,000             | $               0.10                
|                                         |                     |                                     
|Granted                                  | -                   |                                     
|Exercised                                | -                   |                                     
|Canceled                                 | -                   |                                     
|                                         |                     |                                     
|Options outstanding at December 31, 2004 | 250,000             | $               0.10                
|                                         |                     |                                     
|Granted                                  | -                   |                                     
|Exercised                                | -                   |                                     
|Canceled                                 | -                   |                                     
|                                         |                     |                                     
|Options outstanding at December 31, 2005 | 250,000             | $               0.10                
|                                         |                     |                                     
|                                         |                     |                                     



|At December 31, 2005, the weighted average remaining contractual life of stock options outstanding was 1.8 years, with 250,000 options exercisable at a weighted average exercise price of $0.10 per share.                                                       
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                  
|NOTE H - OPERATING LEASE OBLIGATIONS                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                  
|The Company leases office and warehouse space and certain equipment under operating lease agreements having terms expiring at various dates through August 2008. The future minimum annual payments required under the leases at December 31, 2005 are as follows:
|                                                                                                                                                                                                                                                                  

| | 2006  | $         77,799
| | ----- | ----------------
| | 2007  | 76,574          
| | 2008  | 52,534          
| |       |                 
| | Total | $206,907        
| |       |                 

|                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Rental and other related expenses for the above leases for the years ended December 31, 2005 and 2004 were approximately $65,000 and $63,000, respectively.                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|NOTE I - INCOME TAXES                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|As of December 31, 2005, the Company had a net deferred tax asset of approximately $4.2 million principally arising from net operating loss carryforwards for income tax purposes. The Company has established a valuation allowance equal to the net deferred tax asset as of December 31, 2005. At December 31, 2005 the Company had net operating loss carryforwards of approximately $10.5 million that will begin to expire in 2014 through 2022.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|The Company's reverse acquisition in 2003 and subsequent issuances of stock have effected ownership changes under Internal Revenue Code Section 382. The ownership changes resulting from this reorganization will likely limit the Company's ability to utilize a significant portion of the net operating loss carryforwards generated before the changes in ownership.                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                      

|                                           | 2005                | 2004              
|------------------------------------------ | ------------------- | ------------------
|Deferred tax asset (liabilities):          |                     |                   
|Net operating loss carryforward            | $         3,881,067 | $        4,848,580
|Depreciation                               | (875)               | (2,094)           
|Allowance for doubtful accounts            | 18,974              | 15,706            
|Accrued expenses not deductible until paid | 348,165             | 239,279           
|                                           |                     |                   
|Net total deferred tax asset               | $         4,247,331 | $        5,101,471
|                                           |                     |                   
|Valuation allowance                        | $(4,247,331)        | $ (5,101,471)     
|                                           |                     |                   
|Net deferred tax asset                     | $-                  | $-                
|                                           |                     |                   







|    
|----
|    
|F-16



|NOTE J - COMMITMENTS AND CONTINGENCIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|The Company may become involved from time to time in litigation on various matters, which are routine to the conduct of its business. The Company believes that none of these actions, individually or in the aggregate, will have a material adverse effect on its financial position or results of operations, though any adverse decision in these cases or the costs of defending or settling such claims could have a material effect on its business.                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|On July 2, 2004, RR Donnelley Receivables, Inc. sued ADS to collect a sworn account in the amount of $28,503.76, plus attorney fees and expenses. ADS responded with a general denial and a counterclaim for breach of contract regarding a partnership with the plaintiff in Mexico. In November 2005, the counterclaim was dismissed on jurisdictional grounds. The suit on the sworn account remains pending, but no activity has taken place since November 2005. These amounts have been accrued for in these financial statements.                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NOTE K - RELATED PARTY TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|During the years ended December 31, 2005 and 2004, the Company purchased $0 and $2,740, respectively, in goods and services from Laser Dimensions, Inc., a company in which two of the officers of the Company own a non-controlling interest. As of both December 31, 2005 and 2004, the Company owed Laser Dimensions $0.                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|During the years ended December 31, 2005 and 2004, two officers of the Company voluntarily deferred $193,438 and $145,842, respectively, in salary. These salaries will remain deferred until such time as cash flow permits payment.                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|In 2004, theCompany issued a short-term note payable for $18,667 to an officer of the company. In connection with obtaining this short-term debt financing, the Company also issued the officer warrants to purchase up to 155,556 shares of common stock at an exercise price of $0.12 per share. The Company repaid the principal and interest in full on this note in 2004.                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|In 2004, the Company issued a short-term note payable for $60,000 to a 5% shareholder of the company. In connection with obtaining this short-term debt financing, the Company also issued the shareholder warrants to purchase up to 500,000 shares of common stock at an exercise price of $0.12 per share. The Company repaid the principal and interest in full on this note in 2004.                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|In 2004, the Company issued a note payable for $20,000 to an officer of the company. Principal and interest are payable monthly beginning June 15, 2005, until paid in full. Payments made to an officer during fiscal years 2005 and 2004 were $17,500 and $0, approximately.                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|In 2005, the Company issued 145,846 shares of common stock, at a price of $0.13 per share, to a consultant's partnership, in which two 5% shareholders are partners, in exchange for professional services totaling $18,960.                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NOTE L - CONCENTRATION OF RISKS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|One customer totaled approximately 55% of the Company's revenues for the year ended December 31, 2005. Four customers each totaled approximately 36%, 18%, 16% and 11% of the Company's revenues for the year ended December 31, 2004. Concentration of credit risk and failure to collect accounts receivable have not presented significant problems to ADS Media. With a significant amount of the Company's revenues generated by a few major customers, the loss of one of these customers could have a material adverse effect on our business, operating results and financial condition.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|F-17