GLOBAL TECH INDUSTRIES GROUP, INC 10-Q for FY2021 Q2
GLOBAL TECH INDUSTRIES GROUP, INC. (GTII)
About this 10-Q
GLOBAL TECH INDUSTRIES GROUP, INC filed this 10-Q on August 16, 2021, covering the quarter ended June 30, 2021 (FY2021 Q2).
Headline figures
Quarter ended June 30, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Net loss
- $1.1M
- compared with a net loss of $352.64K a year earlier
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
For Quarterly Period Ended
or
For the Transition period from _______________ to ______________
Commission
File Number:
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act: None
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| None | N/A | N/A |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
| ☒ | No | ☐ |
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
| ☒ | No | ☐ |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
| Yes | ☐ | ☒ |
Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.
As of August 16, 2021 the number of shares outstanding of the registrant’s class of common stock was .
TABLE OF CONTENTS
| 2 |
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GLOBAL TECH INDUSTRIES GROUP, INC.
Condensed Consolidated Balance Sheets
(Unaudited)
| June 30, | December 31, | |||||||
| 2021 | 2020 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Prepaid expenses | - | |||||||
| Marketable securities | ||||||||
| Total Current Assets | ||||||||
| PROPERTY & EQUIPMENT (NET) | ||||||||
| OTHER ASSETS | ||||||||
| License | - | |||||||
| Fine art | - | |||||||
| Total Other Assets | - | |||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Accounts payable and accrued expenses-related parties | ||||||||
| Accrued interest payable | ||||||||
| Notes payable in default | ||||||||
| Due to related parties | ||||||||
| Convertible debenture | - | |||||||
| Stock deposits | - | |||||||
| Total Current Liabilities | ||||||||
| Total Liabilities | ||||||||
| STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||
| Preferred stock, par value $, authorized, issued and outstanding | ||||||||
| Common stock, par value $per share, shares authorized; (including shares held in escrow) and issued and and outstanding, respectively | ||||||||
| Additional paid-in-capital | ||||||||
| Accumulated (Deficit) | ( | ) | ( | ) | ||||
| Total Stockholders’ Equity (Deficit) | ( | ) | ( | ) | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 3 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Condensed Consolidated Statements of Operations
(Unaudited)
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| For The Three Months Ended | For The Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
| REVENUES | $ | $ | $ | $ | ||||||||||||
| OPERATING EXPENSES | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Depreciation | - | - | ||||||||||||||
| Compensation and professional fees | ||||||||||||||||
| Total Operating Expenses | ||||||||||||||||
| OPERATING LOSS | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| OTHER INCOME (EXPENSES) | ||||||||||||||||
| Gain (loss) on marketable securities | ( | ) | ||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total Other Income (Expenses) | ( | ) | ( | ) | ||||||||||||
| LOSS BEFORE INCOME TAXES | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| INCOME TAX EXPENSE | - | - | - | - | ||||||||||||
| NET LOSS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| BASIC AND DILUTED LOSS PER SHARE | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED | ||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 4 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(Unaudited)
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Preferred Stock | Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | ||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Deficit | Deficit | ||||||||||||||||||||||
| Balance, December 31, 2019 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Imputed interest – loan | - | |||||||||||||||||||||||||||
| Shares issued for services and prepaid shares earned (Note 9) | ||||||||||||||||||||||||||||
| Shares issued for services and prepaid shares earned (Note 9), shares | ||||||||||||||||||||||||||||
| Warrants issued to shareholders of record on April 1, 2021 as dividend | ||||||||||||||||||||||||||||
| Shares cancelled from ARUR acquisition recission | ||||||||||||||||||||||||||||
| Shares cancelled from ARUR acquisition recission,shares | ||||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Gold Transactions Intl, Inc. | ||||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Gold Transactions Intl, Inc,shares | ||||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Bronx Family Eye and My Retina | ||||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Bronx Family Eye and My Retina,shares | ||||||||||||||||||||||||||||
| Net loss for the three months ended March 31, 2020 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2020 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Imputed interest – loan | ||||||||||||||||||||||||||||
| Shares issued for services | - | |||||||||||||||||||||||||||
| Shares cancelled from ARUR acquisition recission | ( | ) | ( | ) | - | |||||||||||||||||||||||
| Net loss for the three months ended June 30, 2020 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, June 30, 2020 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Balance, December 31, 2020 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Shares issued for services | - | |||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Gold Transactions Intl, Inc. | ( | ) | ||||||||||||||||||||||||||
| Imputed interest – loan | ||||||||||||||||||||||||||||
| Net loss for the three months ended March 31, 2021 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, March 31, 2021 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
| Shares issued for services and prepaid shares earned (Note 9) | - | |||||||||||||||||||||||||||
| Warrants issued to shareholders of record on April 1, 2021 as dividend | ( | ) | ||||||||||||||||||||||||||
| Shares issued and held in escrow for the potential acquisition of Bronx Family Eye and My Retina | ( | ) | - | |||||||||||||||||||||||||
| Imputed interest – loan | ||||||||||||||||||||||||||||
| Net loss for the three months ended June 30, 2021 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance, June 30, 2021 | $ | $ | $ | $ | ( | ) | $ | ( | ) | |||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 5 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
| 2021 | 2020 | |||||||
| For The Six Months Ended | ||||||||
| June 30, | ||||||||
| 2021 | 2020 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss | $ | ( | ) | ( | ) | |||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation | - | |||||||
| Stock issued for services | ||||||||
| Imputed interest on loan | ||||||||
| (Gain) loss on marketable securities | ( | ) | ||||||
| Change in operating assets and liabilities | ||||||||
| Decrease is prepaid expenses | - | |||||||
| Increase in accounts payable and accrued expenses-related parties | 356,598 | 322,322 | ||||||
| Increase in accrued interest payable | ||||||||
| Increase in interest payable-related parties | - | |||||||
| Increase in accounts payable and accrued expenses | ||||||||
| Net Cash Used in Operating Activities | ( | ) | ( | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Cash paid for fine art | ( | ) | - | |||||
| Cash paid for license | ( | ) | - | |||||
| Net Cash Used in Investing Activities | ( | ) | - | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Cash from stock deposits | - | |||||||
| Cash paid on convertible debenture | ( | ) | - | |||||
| Cash paid on related party loans | ( | ) | - | |||||
| Cash received from related party loans | ||||||||
| Net Cash Provided by Financing Activities | ||||||||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | ( | ) | ||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | ||||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURES: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for income taxes | $ | $ | ||||||
| NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
| Stock issued and held in escrow for potential acquisitions | - | |||||||
| Reclassification of notes payable to stock deposits | - | |||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
| 6 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
A) CONSOLIDATION
The accompanying consolidated financial statements have been prepared by GLOBAL TECH INDUSTRIES GROUP, INC. (“the Company”) without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at June 30, 2021, and the results of operations and cash flows for the three and six months then ended, have been made.
The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive financial statements and should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2020. The results of operations for the period ended June 30, 2021 are not necessarily indicative of the operating results for the full year ended December 31, 2021.
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries as disclosed in Note 2 below. All significant inter-company balances and transactions have been eliminated.
B) GOING CONCERN
The Company’s consolidated financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its operating expenses and seeking equity and/or debt financing. The Company expects with the acquisitions of GTI, Bronx Family Eye Care, and My Retina, that these operations will help support the cashflow needs of the Company. Management also expects with the commencement of revenue generating operations from these subsidiaries, that the warrants issued to shareholders will be exercised in the near future, thus providing capital for the Company and its growth plans. However, management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
On March 11, 2020, the World Health Organization declared the outbreak of a coronavirus (COVID-19) a pandemic. As a result, economic uncertainties have arisen which have the potential to negatively impact the Company’s ability to raise funding from the markets. Other financial impacts could occur though such potential impacts are unknown at this time.
| 7 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
A) PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Ludicrous, Inc., TTI Strategic Acquisitions and Equity Group, Inc, TTII Oil & Gas, Inc., and GT International, Inc. All subsidiaries of the Company, other than TTI Strategic Acquisitions and Equity Group, Inc., currently have no financial activity. All significant inter-company balances and transactions have been eliminated. Because the performance obligations associated with the acquisitions of GTI, Bronx and My Retina have not yet been met, these subsidiaries are still contingent and have not been consolidated with the Company.
B) USE OF MANAGEMENT’S ESTIMATES
The preparation of 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 as of the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates.
C) CASH EQUIVALENTS
The
Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash and cash
equivalents are maintained with major financial institutions in the U S. Deposits held with these banks at times exceed $
D) INCOME TAXES
The Company applies ASC 740 which requires the asset and liability method of accounting for income taxes. The asset and liability method require that the current or deferred tax consequences of all events recognized in the financial statements are measured by applying the provisions of enacted tax laws to determine the amount of taxes payable or refundable currently or in future years. Deferred tax assets are reviewed for recoverability and the Company records a valuation allowance to reduce its deferred tax assets when it is more likely than not that all or some portion of the deferred tax assets will not be recovered.
ASC 740 requires recognition and measurement of uncertain tax positions using a “more-likely-than-not” approach, requiring the recognition and measurement of uncertain tax positions. Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all the deferred tax assets will to be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
E) REVENUE RECOGNITION
The Company had no revenues during the six months ended June 30, 2021 and 2020, however when revenues commence, the Company will recognize revenues in accordance with ASC 606, “Revenue from Contracts with Customers.” Revenue is recognized per our contract with our customers at a point of time when control of our products or services are transferred to our customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products, and after all our performance obligations have been met. The Company currently has minimal consulting sales with performance obligations of hours expended on various projects with our customers pursuant to underlying contracts. If we subsequently determine that collection from any customer is not reasonably assured, we record an allowance for doubtful accounts and bad debt expense for all that customer’s unpaid invoices and cease recognizing revenue for continued services provided until cash is received.
| 8 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
The Company accounts for stock-based compensation in accordance with the provisions of ASC 718. ASC 718 requires all share-based payments to employees, including grants of employee stock options, to be recognized in the financial statements based on the grant-date fair value of the award. That cost will be recognized over the period during which an employee is required to provide service in exchange for the reward- known as the requisite service period. No compensation cost is recognized for equity instruments for which employees do not render the requisite service. The grant-date fair value of employee share options and similar instruments are estimated using the Black Scholes option-pricing model adjusted for the unique characteristics of those instruments.
Equity instruments issued to non-employees are recorded at their fair values as determined in accordance with ASC 718 as amended by ASU 2018-07. As such, the grant date is the measurement date of an award’s fair value.
G) FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company follows ASC 820, “Fair Value Measurements.” ASC 820 defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:
| Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. | ||
| Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. | ||
| Level 3 inputs to the valuation methodology are unobservable and significant to the fair measurement. |
The carrying amounts reported in the balance sheets for cash and cash equivalents, and current liabilities each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The carrying value of notes payable approximates fair value because negotiated terms and conditions are consistent with current market rates as of June 30, 2021 and December 31, 2020.
Marketable securities are reported at the quoted and listed market rates of the securities held at the period end.
| 9 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
The following table presents the Company’s marketable securities within the fair value hierarchy utilized to measure fair value on a recurring basis as of June 30, 2021 and December 31, 2020:
SCHEDULE OF FAIR VALUE ASSETS AND LIABILITIES MEASURED ON RECURRING BASIS
| Level 1 | Level 2 | Level 3 | |||||||||||
| Marketable Securities – June 30, 2021 | $ | $ | - | $ | - | ||||||||
| Marketable Securities – December 31, 2020 | $ | $ | - | $ | - | ||||||||
The Company calculates earnings per share in accordance with ASC 260, “Earnings Per Share.” Basic loss per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share gives effect to dilutive convertible securities, options, warrants and other potential common stock outstanding during the period; only in periods in which such effect is dilutive. For June 30, 2021, there were stock options outstanding, however their effects were anti-dilutive. For June 30, 2020, there were potentially dilutive securities to consider in the fully diluted earnings per share calculation.
| 2021 | 2020 | |||||||
| For the Three Months Ended | ||||||||
| June 30, | ||||||||
| 2021 | 2020 | |||||||
| Loss (numerator) | $ | ( | ) | $ | ( | ) | ||
| Shares (denominator) | ||||||||
| Basic and diluted loss per share | $ | ( | ) | $ | ( | ) | ||
| 2021 | 2020 | |||||||
| For the Six Months Ended | ||||||||
| June 30, | ||||||||
| 2021 | 2020 | |||||||
| Loss (numerator) | $ | ( | ) | $ | ( | ) | ||
| Shares (denominator) | ||||||||
| Basic and diluted loss per share | $ | ( | ) | $ | ( | ) | ||
I) RECENT ACCOUNTING PRONOUNCEMENTS
The Company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
J) Marketable Securities
The Company purchases marketable securities and engages in trading activities for its own account. Securities that are held principally for resale in the near term are recorded at fair value with changes in fair value included in earnings. Interest and dividends are included in net Interest Income.
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GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
NOTE 3 - MARKETABLE SECURITIES
The
Company has acquired various shares of Marketable Securities over the past several years and engages in trading activities for its own
account. The Company’s marketable securities are listed on various exchanges with readily determinable fair value per the guidance
of ASC 321, “Investments – Equity Securities.” The fair value of these shares at June 30, 2021 and December 31, 2020
amounted to $
NOTE 4 - FIXED ASSETS
During
the year ended 2020, the Company wrote off all fixed assets purchased prior to 2019, that were fully depreciated. Depreciation expense
for the six months ended June 30, 2021 and 2020 was $
Fixed assets consist of the following:
SCHEDULE OF FIXED ASSETS
| June 30, 2021 | December 31, 2020 | |||||||
| Computer equipment | $ | $ | ||||||
| Total fixed assets | ||||||||
| Accumulated Depreciation | ( |
) | ( |
) | ||||
| Net fixed assets | $ | $ | ||||||
NOTE 5 LICENSES
GOLD TRANSACTIONS NETWORK LICENSE
On February 28, 2021, pursuant to a Stock Purchase Agreement (the “SPA”) between the Company and Gold Transactions International, Inc. (GTI), the Company assumed a License Agreement held by GTI. The Company has not accounted for the acquisition of the license due to a performance obligation that has not yet been met, but is disclosing the terms of the License due to the legal acquisition of the license. The license provides access to a joint venture of companies (the “Network”), that buys gold from artisan miners internationally, and provides transportation, assaying, refining and storage facilities in the DMCC, a free trade zone for commodities trading in Dubai, and then sells the refined gold to its customers. The License Agreement grants the Company the following:
| ● | Access to the Network’s gold operations, to participate in the profits generated by the margin between the buy and sell prices, based on the % of funds advanced into the Network, | |
| ● | an exclusive license to market and promote the gold buy/sell program in an attempt to increase the buying power of the Network. The term of the License is un-defined and perpetual. | |
| ● | Reporting from the Network partners of gold transactions shared in, and the revenue generated on a monthly basis. Payments, however are quarterly to the Network partners. |
Pursuant
to the SPA,
DIGITAL TRADING PLATFORM LICENSE
On
May 1, 2021, the Company entered an agreement with Alt 5 Sigma, Inc. (“Alt 5”), wherein Alt 5 licensed their Alt5Pro Digital
Asset Platform to the Company and created “Beyond Blockchain”, a digital asset trading platform to be used by the Company
and its shareholders and the public for trading digital assets. The Company paid $
| 11 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
NOTE 6 – FINE ART
On
April 7, 2021, the Company executed a Contractor Agreement with Ronald Cavalier, an artist with galleries in Greenwich, CT, New York
City, Nantucket Island and Palm Beach, FL. Pursuant to this agreement, Mr. Cavalier has assisted the Company in acquiring
On
June 4, 2021, the Company purchased another piece of fine art, an Andy Warhol gelatin silver print of Bianca Jagger on a white horse
taken by Warhol at the famed Studio 54 (the “Warhol Print”) for $
NOTE 7 - RELATED PARTY TRANSACTIONS
Due to Related Parties
Due
to related parties consists of cash advances and expenses paid by Mr. Reichman in order to satisfy the expense needs of the Company.
The payables and cash advances are unsecured, due on demand and do not bear interest. During the six months ended June 30, 2021 and 2020,
Mr. Reichman advanced $
Accrued Wages
The
Company does not have sufficient operations and funds to pay its officers their wages in cash, therefore all wages have been accrued
for the six months ended June 30, 2021 and 2020. The accrued wages for the six months ended June 30, 2021 and 2020 are $
NOTE 8 - NOTES PAYABLE
(a) NOTES PAYABLE IN DEFAULT:
Notes
payable in default consist of various notes bearing interest at rates from
| 12 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
During
2002, the Company settled a trade payable in litigation by executing a note payable to a company in the amount of $
Also
during 2002, in settlement of another trade payable, the Company executed a note payable to a company in the amount of $
During
2000, the Company executed a note payable to an individual in the amount of $
In
2002, the Company settled an obligation with a consultant by executing a note payable for $
On
December 27, 2009, the Company executed a note payable to an individual for various advances to the Company in the amount of $
In
January 27, 2010, the Company executed a note payable to a corporation in the amount of $
On
August 28, 2012, and September 17, 2012, the Company executed a note payable to a corporation in the amount of $
On
April 12, 2012, the Company executed a note payable to a corporation in the amount of $
On
December 31, 2012, the Company executed a note payable to a corporation in the amount of $
On
March 11, 2014, the Company executed a note agreement with an LLC in the amount of $
On
January 31, 2014, the Company executed a note agreement with a Corporation in the amount of $
| 13 |
GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
None of the above notes are convertible or have any covenants.
SCHEDULE OF NOTES PAYABLE
(b) Additional detail to all Notes Payable in Default is as follows:
| June 30, 2021 | December 31, 2020 | Interest | Interest Expense | |||||||||||||||||||
| Principal | Principal | Rate | 6/30/2021 | 6/30/2020 | Maturity | |||||||||||||||||
| $ | % | |||||||||||||||||||||
| % | ||||||||||||||||||||||
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At
June 30, 2021 and December 31, 2020, accrued interest on the outstanding notes payable were $
(c) CONVERTIBLE DEBENTURE:
On
November 27, 2020, the Company executed a convertible debenture with a corporation in the amount of $
The
convertible debenture also contained an OID or original issue discount of $
Accrued
interest and penalties at June 30, 2021 and December 31, 2020 were $
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GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
(d) STOCK DEPOSITS
On
February 26, 2021, the Company received cash from an accredited investor in the amount of $
On
March 26, 2021, the Company received an additional amount of $
During
the 2nd quarter 2021, the Company received
Stock deposits are advances only and do not bear interest and are unsecured, but have the intention of being satisfied through the issuance of common shares of the Company during the current fiscal period.
NOTE 9 - STOCKHOLDERS’ EQUITY (DEFICIT)
ISSUANCES OF COMMON STOCK
During
the six months ended June 30, 2021 and 2020, the Company issued and shares of common stock with a fair market value
of $
During
the second quarter 2021, the Company re-negotiated its contractor agreements with its contract professionals, wherein, due to the increase
stock price during 2021, the contractors agreed to accept the shares issued in the first quarter 2021 ( shares each), as a prepayment
(escrow) of shares, and agreed to record the earned shares each quarter, based on the 10 day moving average stock price at quarters end,
based on the individual contractor agreed compensation. This change in contract administration required a recording of expense at June
30, 2021 in the amount of $
On
February 28, 2021, the Company executed a Stock Purchase Agreement wherein the Company acquired all the issued and outstanding stock
of Gold Transactions International, Inc. (GTI) (a Utah Corporation), for the issuance of shares of common stock valued at $
Effective April 1, 2021, the Company, signed a binding agreement (the “Agreement”) with Bronx Family Eye Care, Inc. (BFE), engaged in the business of full scope optometry at its four primary locations, three of which are in the Bronx, one of which is in Manhattan, New York, as well as at a fabrication facility in the Bronx. The two companies agreed to engage in a business combination such that BFE will become a wholly owned subsidiary of GTII, and the shareholders of BFE will acquire two million six hundred fifty thousand () shares of the Company’s common stock, subject to the terms and conditions set forth in the Agreement. The shares have been issued, but are held in escrow until the closing conditions are met, therefore these share are reported as issued but not outstanding. The Agreement also includes a requirement to have a 2-year audit from a licensed CPA firm as a condition to the finalization of the Agreement, therefore, no operating activities, assets or liabilities will be consolidated with the Company until this final condition is met.
There
were no acquisition related costs incurred in acquiring BFE. The initial accounting of the BFE acquisition is incomplete as of the date
of the Company’s 10-Q filing. Therefore, disclosures related to the issuers recording of the acquisition, and related balance sheet
and income statement disclosures cannot be made at this time. Effective April 1, 2021, the operations of BFE will be consolidated with
the Company, upon the conditions described above being met. BFE is a currently operating company with revenues in excess of $
On
June 24, 2021, the Company executed a Stock Purchase Agreement (SPA) with MyRetinaDocs LLC (“My Retina”), a New York Limited
Liability Company, with principal business operations in New York City. My Retina is a SaaS software and practice management company
performing diagnostic medical care services. My Retina licenses, leases and operates its proprietary telemedicine software, as well as
medical equipment together to offer eye exam data to its clients. My Retina also has a diagnostic medical eye exam company that
provides on-demand services of at-home eye exams to patients, as well as bulk exams conducted at medical offices and virtual exams conducted
through telemedicine software. The Company issued shares of common stock in exchange for
There were no acquisition related costs incurred in acquiring My Retina. The initial accounting of the My Retina acquisition is incomplete as of the date of the Company’s 10-Q filing. Therefore, disclosures related to the issuers recording of the acquisition, and related balance sheet and income statement disclosures cannot be made at this time.
On June 28, 2021, the Company increased its authorized shares of common stock to .
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GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
ISSUANCES OF PREFERRED STOCK
Pursuant to the Articles of Incorporation of the Company, there was initially authorized shares of Series A Preferred Stock. On April 7, 2016, the Company’s Board of Directors created and issued out of the Series A Preferred Stock, Series A Preferred shares with the following features:
| a) | ||
| b) | No entitlement to dividends. | |
| c) | No liquidation preferences. | |
| d) | No conversion rights. | |
| e) | Automatic Redemption Rights upon certain triggers, to be redeemed at par value. |
STOCK OPTIONS
On December 19, 2020, in conjunction with the conversion of related party notes, accrued interest and compensation, the Company authorized the issuance of stock options with the following features:
| ● | One option allows for the purchase of one share of common stock | |
| ● | The strike price of the option is $ | |
| ● | The conversion term is from issuance date | |
| ● | All options are vested immediately |
The value of the options were determined using the Black-Scholes valuation method, and the Company uses the following methods to determine its underlying assumptions: expected volatilities are based on the historical monthly closing price of the Company’s common stock; the expected term is 2 year, the risk free interest rate used is based on the U.S Treasury implied yield zero-coupon issue with similar life terms to the expected life of the grant; and the expected divided yield is based on the current annual dividend. No compensation was recorded with the 4,500,664 option issuance as the $ valuation of the options granted did not exceed the recorded amount of debt it was converting.
| Assumptions: | 2021 | 2020 | ||||||
| Assumptions applicable to stock options issued | ||||||||
| Risk-free interest rate | % | % | ||||||
| Expected lives (in years) | ||||||||
| Expected stock volatility | % | % | ||||||
| Dividend yield | ||||||||
SCHEDULE OF STOCK OPTION
| Weighted | Weighted | |||||||||||||||
| Average | Average | Aggregate | ||||||||||||||
| Exercise | Remaining | Intrinsic | ||||||||||||||
| Shares | Price | Term | Value | |||||||||||||
| Outstanding at January 1, 2020 | $ | $ | ||||||||||||||
| Granted | yrs | |||||||||||||||
| Exercised | - | - | ||||||||||||||
| Forfeited | - | - | ||||||||||||||
| Outstanding at December 31,2020 | $ | yrs | $ | |||||||||||||
| Outstanding at January 1,2020 | $ | yrs | $ | |||||||||||||
| Granted | - | - | ||||||||||||||
| Exercised | - | - | ||||||||||||||
| Forfeited | - | - | ||||||||||||||
| Outstanding at June 30, 2021 | $ | yrs | $ | |||||||||||||
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GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
WARRANTS
On
March 22, 2021, GTII entered into a warrant agreement with Liberty Stock Transfer Agent (“Liberty”), whereby Liberty agreed
to act as GTII’s warrant agent in its offering of warrants to GTII’s shareholders (each, a “Warrant”). All shareholders
of record on April 1, 2021, were issued of a Warrant per share of Common Stock held of
record by such holder. This agreement created
SCHEDULE OF WARRANTS ISSUANCE OF FAIR VALUE ASSUMPTIONS
| Assumptions: | 2021 Warrants | |||
| Assumptions applicable to stock options issued | ||||
| Risk-free interest rate | ||||
| Expected lives (in years) | ||||
| Expected stock volatility | ||||
| Dividend yield |
Warrant transactions are as follows:
SCHEDULE OF WARRANTS
| Weighted | Weighted | |||||||||||||||
| Average | Average | Aggregate | ||||||||||||||
| Exercise | Remaining | Intrinsic | ||||||||||||||
| Shares | Price | Term | Value | |||||||||||||
| Outstanding at January 1, 2020 | $ | - | $ | |||||||||||||
| Granted | - | |||||||||||||||
| Exercised | - | |||||||||||||||
| Forfeited | - | |||||||||||||||
| Outstanding at December 31, 2020 | $ | - | $ | |||||||||||||
| Granted | yrs | $ | ||||||||||||||
| Exercised | - | |||||||||||||||
| Forfeited | - | |||||||||||||||
| Outstanding at June 30, 2021 | $ | yrs | $ | |||||||||||||
OTHER
During
the three months ended June 30, 2021 and 2020, the Company recorded imputed interest on a non-interest-bearing note in the amount of
$
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GLOBAL TECH INDUSTRIES GROUP, INC.
Notes to the Unaudited Condensed Consolidated Financial Statements
June 30, 2021
NOTE 10 - LEGAL ACTIONS
On February 3, 2017, the Company filed suit in Eastern District Federal Court New York against American Resource Technologies, Inc., (ARUR) and several directors and officers relating to the Chautauqua County Court Kansas decision nullifying the acquisition Agreement of ARUR. The Company has made several attempts to recover the shares of GTII stock paid to ARUR for the asset acquisition and the various costs and expenses expended by GTII in fulfillment of its obligations under the contract with ARUR. The failure of non-litigation attempts to resolve the matter resulted in filing an action for declaratory judgment in the US District Court for the Eastern District of New York, Docket No. 17-CV-0698. The case was subsequently withdrawn due to the close of ARUR operations. During 2020, the Company was successful in recalling the shares and cancelling them from the shareholder list.
On December 30, 2016, the Company executed a stock purchase agreement (the “Agreement”), which was signed and closed in Hong Kong, with GoFun Group, Ltd. through its wholly owned subsidiary Go F & B Holdings, Ltd. GoFun Group, Ltd. is a privately held company running a casual dining restaurant business, based in Hong Kong. Subsequent to the agreement being signed, GoFun Group failed to substantially perform under the agreement, including, but not limited to providing audited financials of its assets, making the ongoing payments called for in the agreement, along with other matters that led Global Tech to initiate litigation in the United States. Currently, Global Tech and GoFun are litigating the matter in the U.S District Court for the southern district of New York. The original acquisition agreement and rescission was recorded on the Company’s books in 2016, however the physical share certificates were not returned to the Company. During the last quarter 2019, the Company was able to secure, via preliminary settlement, the return of shares of the Company’s stock, that was issued in good faith to GoFun in anticipation of a final stock exchange. The stock has since been returned to the Company’s treasury and cancelled. The Company also reclassified a deposit received from GoFun shareholders in the amount of $ for future share issuances pursuant to the Acquisition Agreement, to a Gain on Settlements and Debt Relief as part of the legal settlement of this case. As of this writing, motions are pending that may require remaining negotiations to continue in arbitration.
On December 30, 2019, a dispute between the Company and its counsel regarding the GoFun matter, above, resulted in a filing, and subsequent settlement, of an action in the Supreme Court of the State of New York for the County of New York (Index No. 656396/2019). Pursuant to the settlement, prior counsel for the Company accepted previously-issued shares in 2016, as full payment for all legal work, expenses, costs, and other fees.
NOTE 11 – SUBSEQUENT EVENTS
The Company has evaluated events subsequent to the balance sheet through the date the financial statements were issued and noted the following events requiring disclosure:
On July
30, 2021 the Company executed a binding Letter of Intent with We SuperGreen Energy Corp (“WSGE”) a renewable clean energy
company with offices in Costa Mesa CA. Under the terms of the LOI, GTII and WSGE will work toward
a definitive agreement whereby GTII would acquire
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Cautionary Statements
This Form 10-Q may contain “forward-looking statements,” as that term is used in federal securities laws, about Global Tech’s consolidated financial condition, results of operations and business. These statements include, among others:
| ● | statements concerning the potential benefits that may be experienced from business activities and certain transactions contemplated or completed; and |
| ● | statements of our expectations, beliefs, future plans and strategies, anticipated developments and other matters that are not historical facts. These statements may be made expressly in this Form 10-Q. You can find many of these statements by looking for words such as “believes,” “expects,” “anticipates,” “estimates,” “opines,” or similar expressions used in this Form 10-Q. These forward-looking statements are subject to numerous assumptions, risks and uncertainties that may cause our actual results to be materially different from any future results expressed or implied in those statements. The most important facts that could prevent us from achieving our stated goals include, but are not limited to, the following: |
| a) | volatility or decline of Global Tech’s stock price; potential fluctuation of quarterly results; |
| b) | Potential fluctuation of quarterly results; |
| c) | failure to earn revenues or profits; |
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| d) | inadequate capital to continue or expand our business, and inability to raise additional capital or financing to implement our business plans; |
| e) | failure to commercialize our technology or to make sales; |
| f) | decline in demand for our products and services; |
| g) | Rapid adverse changes in markets; |
| h) | litigation with or legal claims and allegations by outside parties against GTII, including but not limited to challenges to intellectual property rights;and |
| i) | insufficient revenues to cover operating costs. |
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Overview of Business
Global Tech Industries Group, Inc. (“Global Tech,” “GTII,” “we,” “our,” “us,” “the Company,” “management”) is a Nevada corporation which has been operating under several different names since 1980.
Western Exploration, Inc., a Nevada corporation, was formed on July 24, 1980. In 1990, Western Exploration, Inc. changed its name to Nugget Exploration, Inc. On November 10, 1999, a wholly-owned subsidiary of Nugget Exploration, Inc., Nugget Holdings Corporation, merged with and into GoHealthMD, Inc., a Delaware corporation. Shortly thereafter, Nugget Exploration, Inc. changed its name to GoHealthMD, Inc., a Nevada corporation.
On August 18, 2004, GoHealthMD, Inc., the Nevada Corporation, changed its name to Tree Top Industries, Inc. On July 7, 2017, Tree Top Industries, Inc. changed its name to Global Tech Industries Group, Inc. GoHealthMD, Inc. continues to exist as a Delaware corporation and wholly owned subsidiary of Global Tech Industries Group, Inc., TTI Strategic Acquisitions and Equity Group, Inc., and TTII Oil & Gas, Inc., a Delaware corporation, all were formed by Global Tech in the anticipation of technologies, products, or services being acquired. G T International, Inc., a Nevada corporation, is also a wholly-owned subsidiary of Global Tech Industries Group, Inc. Not all subsidiaries have current operations.
On December 31, 2012, Global Tech and its new subsidiary, TTII Oil & Gas, Inc., a Delaware corporation, signed a binding asset purchase agreement with American Resource Technologies, Inc. (“ARUR”), a Kansas corporation, to acquire all the assets of ARUR for a purchase price of $513,538, which was paid in the form of 4,668,530 shares of Global Tech’s common stock as described in the asset purchase agreement. The shares were valued at $0.11 per share, based on the closing trading price of the common stock on the Closing Date. The assets purchased from ARUR include a 75% working interest in oil and gas leases in Kansas, as well as other oil field assets, a natural gas pipeline, currently shut down that is also located in Kansas, 25% interest in three other business entities operating in Kansas, and accounts receivables from two companies operating in Brazil in the amounts of $3,600,000 and $3,600,000 respectively. TTII Oil & Gas, Inc. also purchased three promissory notes in the amounts of $100,000, $100,000 and $350,000, as well an overdue contract for revenue in the amount of $1,000,000. Finally, a gun sight patent was also acquired from Century Technologies, Inc. All accounts and notes receivable were deemed uncollectable due to the age and circumstances, and therefore were assessed no value in the asset purchase. The equity ownerships were also deemed to be impaired due to the inactive nature of the entities, and were not allocated any value. The gun sight patent was also not readily assessable as to value and no purchase price was allocated to this asset. Also, due to the mechanic’s lien and lawsuit on the oil leases, as well as the absence of an official reserve report, the oil lease was also impaired and no value was recorded for this asset. On September 2015, the Chautauqua County Court decided that American Resource Technologies Inc management and Board of Directors improperly acted and rendered the original Agreement a nullity. During 2019, the Company removed additional obligations related to the ARUR acquisition and settled legal fees due. The Company cancelled the 4,668,530 shares issued to the shareholder of ARUR effective May 18, 2020, and returned the shares to Treasury.
The Company currently has investing operations through TTII Strategic Acquisitions and Equity Group, Inc., wherein the Company holds various Marketable Securities, however the amounts of investments are minimal as of June 30, 2021. The Company is also involved in various merger and acquisition activities, and is currently negotiating opportunities that are expected to bring operating revenues to the Company. The Company continues to seek opportunities to utilize its intellectual properties and relationships with our valued business associates.
On February 28, 2021, the Company executed a Stock Purchase Agreement wherein the Company acquired all the issued and outstanding stock of Gold Transactions International, Inc. (GTI) (a Utah Corporation), for the issuance of 6,000,000 shares of common stock valued at $6,000,000 on the grant date of February 24, 2021. Pursuant to the SPA, a performance obligation exists wherein GTI must achieve a certain profit margin once revenues commence to receive the shares issued. Therefore, the shares have been placed in escrow until the performance obligation is met and the acquisition has not been included in these financial statements. The acquisition of GTI will be accounted for as an asset purchased due to the fact that GTI had been newly formed, had only one asset or asset group and had no operations at the time of the acquisition. Revenue generation for GTI commenced in Q2 of 2021, and the performance obligation is expected to be satisfied at the end of Q3. GTI is in the business of participating, through a License Agreement, with a private joint venture network of companies, in transporting, assaying, buying, storing and selling gold from international artisan gold miners. After the mined dore gold has been shipped to a network third party refinery in the DMCC, a free trade zone in Dubai, the artisan miner’s gold is purchased and refined and sold to the network’s customers. GTI makes revenue on the margin spread of the buy and sell prices.
March 17, 2021, the Company’s Board of Directors approved the declaration by management of a Warrant to holders of its common stock to purchase additional shares of stock. On March 22, 2021, Global Tech Industries Group, Inc., (“GTII”) a Nevada corporation, entered into a warrant agreement with Liberty Stock Transfer Agent (“Liberty”), whereby Liberty agreed to act as GTII’s warrant agent in its offering of warrants to GTII’s shareholders (each, a “Warrant”). All shareholder of record on April 1, 2021, were issued 0.10 of a Warrant per share of Common Stock held of record by such holder. However, no fractional Warrants were issued. The Warrants were issued on or about April 8, 2021. Each full Warrant shall be exercisable into one share of GTII’s common stock at an exercise price of $2.75. The Warrants shall expire on April 8, 2023. Manhattan Transfer Registrar Co. shall act as co-agent with Liberty. The Warrants do not have a cashless exercise provision.
During the first and second quarters of 2021, the Company entered into binding agreements with three companies in the field of eye care, retail eye wear, full scope optometry, telemedicine software, and at-home and bulk eye exams. The Bronx Family Eye Care, Inc. is a company that provides retail eyewear and medically oriented full scope optometry at four brick and mortar locations. Bronx Family’s licensed optometrists use cutting-edge equipment to provide diagnosis and treatment for diseases of the eye, as well as corrective eyewear. Bronx Family also performs edging of lenses for its customers at their in-house facility, as well as providing services to outside practices. My Retina is a SaaS (Software as a Service) software and practice management company that fills an important need for their client-companies to satisfy diagnostic medical care measures in an in- home/house-call setting. My Retina licenses, leases, and operates its proprietary telemedicine software, as well as medical equipment, which together expedite diagnostic medical eye exam data to its corporate clients. Eyecare and Eyewear, Inc. is a diagnostic medical eye exam company that provides on-demand services of at-home eye exams to patients, as well as bulk exams conducted at medical offices, and virtual exams conducted through telemedicine software.
During the second quarter of 2021, the Company signed an agreement with Alt5 Sigma to host a trading platform. The Company then launched Beyond Blockchain (a GTII company) on June 18, 2021, an online cryptocurrency trading platform that provides access to Digital Currency and is changing the way customers transact with Digital Assets. Beyond Blockchain is a registered Money Services Business under FINTRAC guidelines and incorporate world class AML and KYC technology. It uses two-factor authentication to secure customers’ assets as well as AI liveness testing to secure the user experience. Beyond Blockchain allows multi-currency clearing and direct settlements in Bitcoin (BTC), Ethereum (ETH), Tether (USDT), Bitcoin Cash (BCH), Litecoin (LTC), Bitcoin SV (BSV), Aave (AAVE), Compound (COMP), Uniswap (UNI), Chainlink (LINK) and Yearn Finance (YFI).
On June 28, 2021, the Company increased its authorized shares of common stock to 550,000,000.
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Employees
As of August 2, 2021 we have 1 full-time employee and 1 part time employee. We have not experienced any work stoppages and we consider relations with our employees to be good.
RESULTS OF OPERATIONS
Results of Operations for the Three Months Ended June 30, 2021 Compared to Three Months Ended June 30, 2020:
There were no revenues generated during the three months ended June 30, 2021 or 2020. Our general operating expenses increased from $306,043 in 2020 to $1,370,204 in 2021. The increase was primarily the result of an increase in professional services including investor relations, IT, legal, accounting and consulting for our digital asset platform and fine art. The Company issued $866,724 in stock to our professionals during the second quarter 2021 as compared to $92,301 for the second quarter 2020. Our interest expense decreased to $12,904 for the three months ended June 30, 2021 from $57,704 for the three months ended June 30, 2020, due to the conversion of related party debt at December 31, 2020. We also had unrealized gains from our marketable securities of $281,000 for the three months ended June 30, 2021, compared to a gain of $11,109 for the three months ended June 30, 2020.
Our net loss increased by $749,470 from $(352,638) in the 2nd quarter 2020 to a loss of $(1,102,108) in the 2nd quarter 2021. The primary reason for this increase was the increase in professional services, as the Company entered a growth stage of acquisitions and funding requirements. We expect that our losses will continue until we are able to establish a consistent revenue source and finalize our projected acquisitions. With the three acquisitions generating revenues beginning in the 2nd quarter, we expect a changing business environment. Management and the Board are considering additional acquisitions forth coming.
Results of Operations for the Six Months Ended June 30, 2021 Compared to Six Months Ended June 30, 2020:
We realized revenues of $0 during the six months ended June 30, 2021 and 2020. Our general operating expenses increased from $506,908 in 2020 to $2,094,501 in 2021. The increase was primarily the result of increases in professional fees related to our acquisitions, investor relations and consulting on our fine art and NFT trading platform.
Our net loss increased by $1,140,366 from $(637,484) in 2020 to a loss of $(1,777,850) in 2021. The primary reason for this increase was the significant increase in professional fees of $1,567,340, less the gain we received from our unrealized gain on marketable securities of $349,000 compared to a loss of $(15,867) during the six months ended June 30, 2020. We expect that our losses will continue until we are able to establish a consistent revenue source and finalize our projected acquisition. Management and the Board are considering multiple options currently available.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 2021 we had cash on hand of $34,757 compared to $2,479 at December 31, 2020. Cash used by our operations of $(156,004) during the six months ended June 30, 2021 compared to cash used of $(90,015) during the six months ended June 30, 2020. Our operations are supported by our CEO who uses individual credit to pay for expenses of the Company. In the first six months of 2021 our CEO advanced $105,252 as compared to cash advance of $89,943 during 2020. During the six months ended June 30, 2021, the Company reimbursed our CEO $109,325 compared to $0 for the six months ended June 30, 2020. We received $150,000 during the first quarter of 2021, from an accredited investor as a stock deposit, which was used to satisfy the convertible debenture of $74,800 plus accrued interest and penalties. We received an additional $190,000 from an accredited investor as a stock deposit during the 2nd quarter 2021.We anticipate that we will continue to have a negative cash flow from operations for 2021. We do not have sufficient cash on hand at June 30, 2021 to cover our negative cash flow. We will attempt to raise capital through the sale of our common stock or through debt financing, and expand the operations of our acquired businesses to assist in our cashflow needs.
Some of Global Tech’s past due obligations, including $338,000 of accounts payable, and $113,000 of notes payable and judgments, were incurred or obtained prior to 2005. No actions have been taken by any of the applicable creditors, and the statute of limitations has been exceeded for the creditors to seek legal action. Global Tech believes that these obligations will not be satisfied in the future because the statute of limitations has been exceeded, and is currently seeking a judicial resolution to these obligations.
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Any remedy to our current lack of liquidity must take into account all the foregoing liabilities. Global Tech intends to expand and develop its new acquisition operating activities to generate significant cashflow to allow it to pay its current obligations and settle its remaining obligations. Capital raise plans are under consideration but it cannot be assured that they will materialize in the current economic environment. Currently, Global Tech is without adequate financing or liquid assets. Because no actions have been taken on the aforementioned past due obligations and demand has not been made by the applicable current note holders, we are unable to accurately quantify the effect the overdue accounts have on Global Tech’s financial condition, liquidity and capital resources. However, in the event that all of these obligations and notes payable were required to be paid in an amount equal to the full balance of each, Global Tech would not be able to meet the obligations based upon its current financial status. The liquidity shortfall of $(2,282,841) would cause Global Tech to default and, further, would put our continued viability in jeopardy.
CONTRACTUAL OBLIGATIONS
As of June 30, 2021, one new contractual obligation has been executed by the Company. This obligation is due to the hosting and service of our digital asset trading platform with Alt5 and consists of $3,500 per month.
Going Concern Qualification
The Company has incurred significant losses from operations, and such losses are expected to continue. The Company’s auditors have included a “Going Concern Qualification” in their report for the year ended December 31, 2020. In addition, the Company has limited working capital. The foregoing raises substantial doubt about the Company’s ability to continue as a going concern. Management’s plans include seeking additional capital and/or debt financing. There is no guarantee that additional capital and/or debt financing will be available when and to the extent required, or that if available, it will be on terms acceptable to the Company. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The “Going Concern Qualification” may make it substantially more difficult to raise capital.
Potential Impact of COVID-19
The Company is concerned that the COVID-19 virus may impact the Company’s ability to raise additional equity capital due to the uncertainty of the virus’ effects on the economy and capital markets, which may make potential investors less likely to invest during the pandemic. This may affect the Company’s ability to raise equity capital to meet its financial obligations, implement its business plan and continue as a going concern.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information we are required to disclose is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Commission. David Reichman, our Chief Executive Officer and our Principal Accounting Officer, is responsible for establishing and maintaining our disclosure controls and procedures.
Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of the end of the period covered by this report. The disclosure controls and procedures ensure that all information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rule and forms; and (ii) accumulated and communicated to our management as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, management concluded that our controls were not effective as of June 30, 2021.
Changes in Internal Controls over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the fiscal quarter ended June 30, 2021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
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PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On February 3, 2017, the Company filed suit in Eastern District Federal Court New York against American Resource Technologies, Inc., (ARUR) and several directors and officers relating to the Chautauqua County Court Kansas decision nullifying the acquisition Agreement of ARUR. The Company has made several attempts to recover the shares of GTII stock paid to ARUR for the asset acquisition and the various costs and expenses expended by GTII in fulfillment of its obligations under the contract with ARUR. The failure of non-litigation attempts to resolve the matter resulted in filing an action for declaratory judgment in the US District Court for the Eastern District of New York, Docket No. 17-CV-0698. The case was subsequently withdrawn due to the close of ARUR operations. During 2020, the Company was successful in recalling the 4,668,530 shares and cancelling them from the shareholder list
On December 30, 2016, the Company executed a stock purchase agreement (the “Agreement”), which was signed and closed in Hong Kong, with GoFun Group, Ltd. through its wholly owned subsidiary Go F & B Holdings, Ltd. GoFun Group, Ltd. is a privately held company running a casual dining restaurant business, based in Hong Kong. Subsequent to the agreement being signed, GoFun Group failed to substantially perform under the agreement, including, but not limited to providing audited financials of its assets, making the ongoing payments called for in the agreement, along with other matters that led Global Tech to initiate litigation in the United States. Currently, Global Tech and GoFun are litigating the matter in the U.S District Court for the southern district of New York. The original acquisition agreement and rescission was recorded on the Company’s books in 2016, however the physical share certificates were not returned to the Company. During the last quarter 2019, the Company was able to secure, via preliminary settlement, the return of 43,649,491 shares of the Company’s stock, that was issued in good faith to GoFun in anticipation of a final stock exchange. The stock has since been returned to the Company’s treasury and cancelled. The Company also reclassified a deposit received from GoFun shareholders in the amount of $128,634 for future share issuances pursuant to the Acquisition Agreement, to a Gain on Settlements and Debt Relief as part of the legal settlement of this case. As of this writing, motions are pending that may require remaining negotiations to continue in arbitration.
On December 30, 2019, a dispute between the Company and its counsel regarding the GoFun matter, above, resulted in a filing, and subsequent settlement, of an action in the Supreme Court of the State of New York for the County of New York (Index No. 656396/2019). Pursuant to the settlement, prior counsel for the Company accepted previously-issued shares in 2016, as full payment for all legal work, expenses, costs, and other fees.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
There were no unregistered shares of common stock sold for cash during the three months ended June 30, 2021.
There were shares of common stock issued for legal, marketing, and other professional services rendered to the Company by five consultants in the aggregate amount of 166,995 shares during the three months ended June 30, 2021.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
| The Company has the following note payable obligations in default: | ||||
| Note payable to Facts and Comparisons due September 1, 2002, with interest accrued at 6% per annum, unsecured, in settlement of a trade payable; unpaid to date and in default | 18,000 | |||
| Note payable to Luckysurf.com due September 12, 2002 with interest accrued at 6% per annum, unsecured, in settlement of a trade payable; unpaid to date and in default | 30,000 | |||
| Note payable to Michael Marks (a shareholder) due August 31, 2000 with interest accrued at 5% per annum, unsecured; unpaid to date and in default | 25,000 | |||
| Note payable to Steven Goldberg (a former consultant) due July 10, 2002, unsecured with interest of 7% accrued if unpaid at due date, in settlement of liability; unpaid to date and in default | 40,000 | |||
| Note payable to a corporation, unsecured with interest of 6% per annum, unpaid to date and in default | 7,000 | |||
| Note payable to a corporation, unsecured with interest accruing at 6% per annum, unpaid to date and in default | 100,000 | |||
| Note payable to a corporation, unsecured with interest accruing at 6% per annum, unpaid to date and in default | 32,746 | |||
| Note payable to a corporation, unsecured with interest accruing at 6% per annum, unpaid to date and in default | 32,960 | |||
| Note payable to a corporation, unsecured, non interest bearing, unpaid to date and in default | 192,000 | |||
| Note payable to an LLC, unsecured with interest accruing at 6% per annum, unpaid to date and in default | 5,000 | |||
| Various Notes payable to an individual, unsecured with interest accruing at 6% per annum, unpaid to date and in default | 388,376 | |||
| Totals | $ | 871,082 |
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None of these notes have been paid, and management has indicated that no demand for payment for any of these notes has been received by the Company. However, the Company received a notice of motion from Luckysurf.com dated October 22, 2002, seeking entry of a judgment for $30,000. No further information or action has been received by the Company relating to this note.
ITEM 5. OTHER INFORMATION
Not Applicable
ITEM 6. EXHIBITS
3. Exhibits
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| (1) | Filed November 13, 2009, as an exhibit to a Form 10-Q and incorporated herein by reference. |
| Filed January 3, 2012, as an exhibit to an 8 – K and incorporated herein by reference. | |
| Filed April 12, 2013, as an exhibit to an 8 – K and incorporated herein by reference. | |
| (2) | Filed July 19, 2010, as an exhibit to a Form 10-K/A and incorporated herein by reference. |
| (3) | Filed November 7, 2007, as an exhibit to a Form 8-K and incorporated herein by reference. |
| (4) | Filed March 25, 2010, as an exhibit to a Form 8-K and incorporated herein by reference. |
| (5) | Filed January 19, 2010, as an exhibit to a Form 8-K and incorporated herein by reference. |
| (6) | Filed July 19, 2010, as an exhibit to a Form 10-Q/A and incorporated herein by reference. |
| (7) | Filed February 9, 2011, as an exhibit to a Form 8-K and incorporated herein by reference. |
| (8) | Filed April 19, 2011, as an exhibit to a Form 8 - K and incorporated herein by reference. |
| (9) | Filed October 18, 2011 as an exhibit to a Form 8 - K and incorporated herein by reference. |
| (10) | Filed March 6, 2012 as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (11) | Filed March 23, 2012 as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (12) | Filed August 21, 2012 as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (13) | Filed January 8, 2013 as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (14) | Filed January 8, 2013 as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (15) | Filed January 5, 2017 as an exhibit to a Form 8 – K and incorporated herein by reference.
|
| (16) | Filed April 12, 2019, as an exhibit to a Form 8 – K and incorporated herein by reference. |
| (17) | Filed December 26, 2019, as an exhibit to a Form 8 -K and incorporated herein by reference |
| (18) | Filed November 27, 2020, as an exhibit to a Form 8 -K and incorporated herein by reference |
| (19) | Filed March 1, 2021, as an exhibit to a Form 8 – K and incorporated herein by reference |
| (20) | Filed March 23, 2021, as an exhibit to a Form 8 -K and incorporated herein by reference |
| (21) | Filed March 24, 2021, as an exhibit to a Form 8 – K and incorporated herein by reference |
| (22) | Filed April 6, 2021, as an exhibit to a Form 8 – K and incorporated herein by reference |
| (23) | Filed April 7, 2021, as an exhibit to a Form 8 0 K and incorporated herein by reference |
| (24) | Filed April 30, 2021, as an exhibit to a Form 8 – k and incorporated herein by reference |
| (25) | Filed May 13, 2021, as an exhibit to a Form 8 – K and incorporated herein by reference |
| (26) | Filed June 6, 2021, as an exhibit to a Form 8 – K and incorporated herein by reference |
| (a) | Exhibits |
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Dated: August 16, 2021 | GLOBAL TECH INDUSTRIES GROUP, INC. | |
| By: | /s/ David Reichman | |
| David Reichman, Chairman of the Board, Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer | ||
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By: | /s/ David Reichman | Dated: August 16, 2021 | |
| David Reichman, Chairman of the Board, Chief | |||
| Executive Officer, Chief Financial Officer | |||
| and Principal Accounting Officer | |||
| By: | /s/ Kathy M. Griffin | Dated: August 16, 2021 | |
| Kathy M. Griffin, Director, President | |||
| By: | /s/ Frank Benintendo | Dated: August 16, 2021 | |
| Frank Benintendo, Director & Secretary | |||
| By: | /s/ Donald Gilbert | Dated: August 16, 2021 | |
| Donald Gilbert, Director |
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