UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For Quarterly Period Ended

June 30, 2020

 

or

 

[  ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Transition period from _______________ to ______________

 

Commission File Number:000-10210

 

GLOBAL TECH INDUSTRIES GROUP, INC.

 

(Exact name of registrant as specified in its charter)

 

NEVADA   83-0250943

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

511 Sixth Avenue, suite 800

New York, NY 10011

 

(Address of principal executive offices) (Zip Code)

 

(212) 204 7926

 

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.

 

Yes [X] 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).

 

Yes [X] 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 [  ]
Non-accelerated filer [X] Smaller reporting company [X]
    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 [  ] No [X]

 

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 12, 2020 the number of shares outstanding of the registrant’s class of common stock was 205,149,460.

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Pages
PART I. FINANCIAL INFORMATION 3
     
Item 1. Financial Statements 3
     
  Unaudited Condensed Consolidated Balance Sheets at June 30, 2020 and December 31, 2019 3
     
  Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months ended June 30, 2020 and 2019. 4
     
  Unaudited Condensed Consolidated Statements of Stockholders’ Deficit for the Three and Six Months ended June 30, 2020 and 2019. 5
     
  Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2020 and 2019. 6
     
  Notes to Unaudited Condensed Consolidated Financial Statements 7
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 20
     
Item 3. Quantitative and Qualitative Disclosures About Market Risk 23
     
Item 4. Controls and Procedures 23
     
PART II. OTHER INFORMATION 25
     
Item 1. Legal Proceedings 25
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 26
     
Item 3. Defaults Upon Senior Securities 26
     
Item 5. Other Information 27
     
Item 6. Exhibits 27
     
SIGNATURES 29

 

2

 

 

PART I. FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Condensed Consolidated Balance Sheets

(Unaudited)

 

    June 30,     December 31,  
    2020     2019  
ASSETS            
CURRENT ASSETS                
Cash and cash equivalents   $ 1,363     $ 1,435  
Marketable securities     28,177       44,044  
                 
Total Current Assets     29,540       45,479  
                 
TOTAL ASSETS   $ 29,540     $ 45,479  
                 
LIABILITIES AND STOCKHOLDERS’ DEFICIT                
                 
CURRENT LIABILITIES                
Accounts payable and accrued expenses   $ 717,706     $ 731,327  
Accrued wages-related party    

340,000

      -  
Accrued interest payable     327,984       310,307  
Accrued interest payable-related party     387,321       298,796  
Notes payable in default     871,082       871,082  
Due to officers and directors     89,943       -  
                 
Total Current Liabilities     2,734,036       2,211,512  
                 
LONG-TERM LIABILITIES                
                 
Notes payable related party     3,540,405       3,540,405  
                 
Total Long-Term Liabilities     3,540,405       3,540,405  
                 
Total Liabilities     6,274,441       5,751,917  
                 
STOCKHOLDERS’ DEFICIT                
Preferred stock, par value $.001, 50,000 authorized, 1,000 issued and outstanding     1       1  
Common stock, par value $0.001 per share, 350,000,000 shares authorized; 205,149,460 and 205,277,990 issued and outstanding, respectively     205,150       205,278  
Additional paid-in capital     161,812,135       161,712,986  
Accumulated deficit     (168,262,187 )     (167,624,703 )
                 
Total Stockholders’ Deficit     (6,244,901 )     (5,706,438 )
                 
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT   $ 29,540     $ 45,479  

 

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)

 

    For The Three Months Ended     For The Six Months Ended  
    June 30,     June 30,  
    2020     2019     2020     2019  
          (as restated)           (as restated)  
                         
OPERATING EXPENSES                                
                                 
General and administrative     53,548       300,497       81,668       377,815  
Compensation and professional fees     252,495       198,193       425,240       398,102  
                                 
Total Operating Expenses     306,043       498,690       506,908       775,917  
                                 
OPERATING LOSS     (306,043 )     (498,690 )     (506,908 )     (775,917 )
                                 
OTHER INCOME (EXPENSES)                                
                                 
Gain (loss) on marketable securities     11,109       26,306       (15,867 )     61,921  
Interest expense     (57,704 )     (26,900 )     (114,709 )     (53,099 )
                                 
Total Other Income (Expenses)     (46,595 )     (594 )     (130,576 )     8,822  
                                 
LOSS BEFORE INCOME TAXES     (352,638 )     (499,284 )     (637,484 )     (767,095 )
                                 
INCOME TAX EXPENSE     -       -       -       -  
                                 
NET LOSS   $ (352,638 )   $ (499,284 )   $ (637,484 )   $ (767,095 )
                                 
BASIC AND DILUTED LOSS PER SHARE   $ (0.00 )   $ (0.00 )   $ (0.00 )   $ (0.00 )
                                 
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED     206,544,709       170,777,990       205,911,350       170,777,990  

 

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’ Deficit

(Unaudited)

 

    Preferred Stock     Common Stock    

Additional

Paid-in

    Accumulated    

Total

Stockholders’

 
    Shares     Amount     Shares     Amount     Capital     Deficit     Deficit  
                                           
Balance, December 31, 2018     1,000     $        1       170,777,990     $ 170,778     $ 160,739,496     $ (166,195,868 )   $      (5,285,593 )
                                                         
Imputed interest – loan                                     3,360               3,360  
                                                         
Net loss for the three months ended March 31, 2019 (as restated)                                             (267,811 )     (267,811 )
                                                         
Balance, March 31, 2019 (as restated)     1,000     $ 1       170,777,990     $ 170,778     $ 160,742,856     $ (166,463,679 )   $ (5,550,044 )
                                                         
Imputed interest – loan                                     3,360               3,360  
                                                         
Shares issued for services                     5,000,000       5,000       257,500               262,500  
                                                         
Net loss for the three months ended June 30, 2019 (as restated)                                             (499,284 )     (499,284 )
                                                         
Balance, June 30, 2019 (as restated)     1,000     $ 1       175,777,990     $ 175,778     $ 161,003,716     $ (166,962,963 )   $ (5,783,468 )
                                                         
Balance, December 31, 2019     1,000     $ 1       205,277,990     $ 205,278     $ 161,712,986     $ (167,624,703 )   $ (5,706,438 )
                                                         
Imputed interest – loan                                     3,360               3,360  
                                                         
Net loss for the three months ended March 31, 2020                                             (284,846 )     (284,846 )
                                                         
Balance, March 31, 2020     1,000     $ 1       205,277,990     $ 205,278     $ 161,716,346     $ (167,909,549 )   $ (5,987,924 )
                                                         
Imputed interest – loan                                     3,360               3,360  
                                                         
Shares issued for services                     4,540,000       4,540       87,761               92,301  
                                                         
Shares cancelled from ARUR acquisition rescission                     (4,668,530 )     (4,668 )     4,668               -  
                                                         
Net loss for the three months ended June 30, 2020                                             (352,638 )     (352,638 )
                                                         
Balance, June 30, 2020     1,000     $ 1       205,149,460     $ 205,150     $ 161,812,135     $ (168,262,187 )   $ (6,244,901 )

 

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)

 

    For The Six Months Ended  
    June 30,  
    2020     2019  
          (as restated)  
CASH FLOWS FROM OPERATING ACTIVITIES                
                 
Net loss   $ (637,484 )     (767,095 )
Adjustments to reconcile net loss to net cash used in operating activities:                
Stock issued for services     92,301       262,500  
Imputed interest on loan     6,720       6,720  
(Gain) loss on marketable securities     15,867       (61,921 )
Change in operating assets and liabilities                
Increase in accrued interest payable-related party     88,525       43,110  
Increase in accrued wages-related party    

340,000

     

340,000

 
Increase in accounts payable and accrued expenses     4,056       153,045  
                 
Net Cash Used in Operating Activities     (90,015 )     (23,641 )
                 
CASH FLOWS FROM INVESTING ACTIVITIES                
                 
Net Cash Provided by (Used in) Investing Activities     -       -  
                 
CASH FLOWS FROM FINANCING ACTIVITIES                
Cash paid to related party loans     -       (49,396 )
Cash received from related party loans     89,943       69,038  
                 
Net Cash Provided by Financing Activities     89,943       19,642  
                 
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS     (72 )     (3,999 )
                 
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD     1,435       7,819  
                 
CASH AND CASH EQUIVALENTS, END OF PERIOD   $ 1,363     $ 3,820  
                 
SUPPLEMENTAL DISCLOSURES:                
                 
Cash paid for interest   $ -     $ -  
Cash paid for income taxes   $ -     $ -  

 

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, 2020

 

NOTE 1 - CONDENSED FINANCIAL STATEMENTS

 

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, results of operations, and cash flows at June 30, 2020, and for all periods presented herein, 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, 2019. The results of operations for the period ended June 30, 2020 are not necessarily indicative of the operating results for the full year.

 

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. 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 impact could occur though such potential impact is unknown at this time.

 

7

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

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 G T 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.

 

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 $250,000 of insurance provided on such deposits. The Company has not experienced any losses in such accounts and believes that it is not exposed to any significant credit risk on cash and cash equivalents. At June 30, 2020 and December 31, 2019, no excess cash balances existed. There were no cash equivalents at June 30, 2020 and December 31, 2019.

 

8

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

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.

 

The Company adopted ASC 740 at the beginning of fiscal year 2008. This interpretation requires recognition and measurement of uncertain tax positions using a “more-likely-than-not” approach, requiring the recognition and measurement of uncertain tax positions. The adoption of ASC 740 had no material impact on the Company’s financial statements. 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 currently has no source of revenue, however, if and when such revenues can be generated again, we will recognize revenues in accordance with ASC 606, “Revenue from Contracts with Customers.” Revenue is recognized when control of our products are transferred to our customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products. The Company currently has no sales and no performance obligations. If we subsequently determine that collection from that 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.

 

9

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

F) STOCK-BASED COMPENSATION

 

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.

 

10

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

G) FAIR VALUE OF FINANCIAL INSTRUMENTS

 

On January 1, 2008, the Company adopted 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, 2020 and December 31, 2019.

 

Marketable securities are reported at the quoted and listed market rates of the securities held at the year end.

 

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, 2020 and December 31, 2019:

 

    Level 1     Level 2     Level 3  
Marketable Securities – 2020   $ 28,177     $ -0-     $ -0-  
Marketable Securities – 2019   $ 44,044     $ -0-     $ -0-  

 

11

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

H) BASIC AND DILUTED LOSS PER SHARE

 

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 2020 and 2019, there were no potentially dilutive securities to consider in the fully diluted earnings per share calculation.

 

    For the Three Months Ended  
    June 30,  
    2020     2019  
Loss (numerator)   $ (352,638 )   $ (499,284 )
Shares (denominator)     206,544,709       170,777,990  
Basic and diluted loss per share   $ (0.00 )   $ (0.00 )

 

    For the Six Months Ended  
    June 30,  
    2020     2019  
Loss (numerator)   $ (637,484 )   $ (767,095 )
Shares (denominator)     205,911,350       170,777,990  
Basic and diluted loss per share   $ (0.00 )   $ (0.00 )

 

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.

 

12

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

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.

 

NOTE 3 - RELATED PARTY TRANSACTIONS

 

Notes Payable-Related Party

 

The Company is indebted to the officers of the Company for unpaid wages, expenses and cash advances from current and previous years that were converted into Notes. Various Directors and Shareholders have also advanced funds to the Company to support operations. The balances at June 30, 2020 and December 31, 2019 for Related Party Notes Payable are $3,540,405 and $3,540,405, respectively. Accrued interest on the related party notes at June 30, 2020 and December 31, 2019 total $387,321 and $298,796, respectively

 

Mr. Reichman, our CEO, has rendered services to the Company and his wages have been accrued in accrued expenses during 2017, 2018 and 2019. At December 30, 2019, Mr. Reichman agreed to consolidate accrued wages, auto allowance and cash advances into a long-term Note Payable with a term date of July 15, 2021. At December 30, 2019 the Company executed a Note for $2,016,672 which consisted of cash advances of $400,223, accrued wages of $1,500,000 and auto allowances of $116,449. The total Notes due to Mr. Reichman at June 30, 2020 and December 31, 2019 is $2,437,717 and $2,437,717, respectively. All Mr. Reichman’s Notes bear interest at 5%, are unsecured, and have been extended through July 15, 2021. Accrued interest on Mr. Reichman’s Notes are $224,196 and $163,254 at June 30, 2020 and December 31, 2019, respectively.

 

Mrs. Griffin, our President, has rendered services to the Company and her wages have been accrued in accrued expenses during 2017, 2018 and 2019. At December 30, 2019, Mrs. Griffin agreed to consolidate accrued wages and expenses into a long-term Note Payable with a term date of July 15, 2021. At December 30, 2019, the Company executed a Note for $563,000 which consisted of expenses of $16,000 and accrued wages of $547,000. The total Notes due to Mrs. Griffin at June 30, 2020 and December 31, 2019 is $769,670 and $769,670, respectively. All Mrs. Griffin’s Notes bear interest at 5%, are unsecured, and have been extended through July 15, 2021. Accrued interest on Mrs. Griffin’s Notes are $86,410 and $56,834 at June 30, 2020 and December 31, 2019, respectively.

 

On December 13, 2012, the Company executed a note payable to an individual and board member in the amount of $19,000, interest accrues at 8% per annum, unsecured, due after 8 months of execution, but extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $11,079 and $10,319, respectively.

 

On March 6, April 22, April 30, May 24, June 14, June 21, July 3, July 30, November 20, December 2, December 13, 2013, the Company executed notes payable to an individual and board member in the total amount of $31,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, but extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $13,067 and $12,137, respectively.

 

On January 2, January 21, April 24, May 19, July 28, August 26, and December 23, 2014, the Company executed notes payable to an individual and board member in the total amount of $31,500, interest accrues at 6% per annum, unsecured, due after 8 months of execution, but extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $11,563 and $10,617, respectively.

 

13

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

On February 11, April 21, May 6, June 8, June 15, July 17, August 19, October 20, 2015, and January 22, 2016 the Company executed notes payable to an individual and board member in the total amount of $34,800, interest accrues at 6% per annum, unsecured, due after 8 months of execution, but extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $10,517 and $9,471, respectively.

 

On February 28, 2013, the Company executed a note payable to a Trust and shareholder, whose Trustee is our CEO, in the amount of $5,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, and extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $2,200 and $2,050, respectively.

 

On July 23, July 24, August 5, August 26, and September 13, 2013, the Company executed a note payable to a Trust and shareholder, whose Trustee is our CEO, in the total amount of $80,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution. $7,924 was paid on December 31, 2019, leaving a balance of $72,076. Unpaid accrued interest at June 30, 2020 and December 31, 2019 is $2,162 and $0, respectively.

 

On March 6, March 16, March 25, June 30, August 12, September 10, September 14, October 8, October 14, November 30, December 3, December 7, 2015, the Company executed a note payable to a Trust and shareholder, whose Trustee is our CEO, in the total amount of $49,200, which was paid down to $0 at December 31, 2019 interest accrues at 6% per annum, unsecured, due after 12 months of execution (2016). Accrued interest at June 30, 2020 and December 31, 2019 is $0 and $0, respectively.

 

On September 23, and November 10, 2014, the Company executed a note payable to a Trust and shareholder whose Trustee is our CEO, in the total amount of $2,500, which was paid down to $0 at December 31, 2019 interest accrues at 6% per annum, unsecured, due after 8 months of execution (2015). Accrued interest at June 30, 2020 and December 31, 2019 is $0 and $0, respectively,

 

On May 15, July 12, July 17, and November 22, 2013, the Company executed notes payable to an Trust and shareholder, whose Trustee is our CEO, in the total amount of $83,877, interest accrues at 6% per annum, unsecured, due after 8 months of execution, and extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $9,450 and $8,778, respectively.

 

On January 22, 2014, the Company executed a note agreement with a Trust and shareholder, whose Trustee is our CEO, in the amount of $14,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, and has been extended to July 15, 2021. Accrued interest at December 31, 2019 and 2018 is $5,409 and $4,989, respectively.

 

On April 7, 2014, April 17, 2014, June 6, 2014, July 18, 2014 and October 10, 2014, the Company executed note agreements with a Trust and shareholder whose Trustee is our CEO, in various amounts totaling $24,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, and has been extended to July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $9,169 and $8,448, respectively.

 

On October 10, 2014, the Company executed a note payable to a Trust and shareholder, whose Trustee is our CEO, in the amount of $5,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, but extended to July 15, 2021. Accrued interest at June 30,2020 and December 31, 2019 is $1,717 and $1,567, respectively.

 

14

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

On December 30, 2019, the Company executed a note payable to a Trust and shareholder, whose Trustee is our CEO, in the amount of $12,765, interest accrues at 6%, per annum, unsecured, due on July 15, 2021. Accrued interest at June 30, 2020 and December 31, 2019 is $382 and $0, respectively.

 

(b) Additional detail to all Notes Payable-Related Party is as follows:

 

2020     2019     Interest    

Year-to-Date

Interest Expense

       
Principal     Principal     Rate     6/30/2020     6/30/2019     Maturity  
$ 2,016,672     $ 2,016,672       5.00 %   $ 50,416     $ -       7/15/21  
  563,000       563,000       5.00 %     14,076       -       7/15/21  
  409,920       409,920       5.00 %     10,248       10,248       7/15/21  
  11,125       11,125       5.00 %     278       278       7/15/21  
  200,000       200,000       5.00 %     5,000       5,000       7/15/21  
  6,670       6,670       5.00 %     166       166       7/15/21  
  19,000       19,000       8.00 %     760       760       7/15/21  
  31,000       31,000       6.00 %     780       780       7/15/21  
  31,500       31,500       6.00 %     946       946       7/15/21  
  34,800       34,800       6.00 %     1,044       1,044       7/15/21  
  5,000       5,000       6.00 %     150       150       7/15/21  
  72,076       80,000       6.00 %     2,400       2,400       7/15/21  
  -       -       6.00 %     -       1,476       N/A  
  -       -       6.00 %     -       74       N/A  
  83,877       83,877       6.00 %     670       670       7/15/21  
  14,000       14,000       6.00 %     420       420       7/15/21  
  24,000       24,000       6.00 %     720       720       7/15/21  
  5,000       5,000       6.00 %     150       150       7/15/21  
  12,765       12,765       6.00 %     382       -       7/15/21  
                                             
$ 3,540,405     $ 3,540,405             $ 88,606     $ 25,282          

 

Accrued interest on these notes in the aggregate totaled $387,321 and $298,796 at June 30, 2020 and December 31, 2019, respectively.

 

Due to Officers and Directors

 

Due to officers consists of cash advances and expenses paid by Mr. Reichman in order to satisfy the expense needs of the Company. The balance of advances made by Mr. Reichman at December 30, 2019 in the amount of $400,223, were consolidated with other amounts due Mr. Reichman, and a Note Payable was issued in its stead. The payables and cash advances are unsecured, due on demand and do not bear interest. During the six months ended June 30, 2020 and 2019, Mr. Reichman advanced $89,943 and $69,038, respectively, to the Company and was repaid $0 and $49,396, respectively. At June 30, 2020 and December 31, 2019, the amounts Due to Officers and Directors for cash advances and expenses are $89,943 and $0, respectively.

 

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 three and six months ended June 30, 2020 and 2019. The accrued wages for the three months ended June 30, 2020 and 2019 are $170,000, respectively, and the accrued wages for the six months ended June 30, 2020 and 2019 are $340,000, respectively. The balance of accrued wages due to the officers at June 30, 2020 and December 31, 2019, are $340,000 and $0, respectively.

 

15

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

NOTE 4 - NOTES PAYABLE

 

(a) NOTES PAYABLE IN DEFAULT:

 

Notes payable in default consist of various notes bearing interest at rates from 5% to 9%, which are unsecured with original due dates between August 2000 and December 2016. All the notes are unpaid to date and are in default and are thus classified as current liabilities. At June 30, 2020 and December 31, 2019, notes payable in default amounted to $871,082 and $871,082, respectively. Accrued interest on the notes in default at June 30, 2020 and December 31, 2019 are $327,984 and $310,307, respectively. Below is a discussion of the details to the notes payable in default and a table summarizing the notes in default with additional information.

 

During 2002, the Company settled a trade payable in litigation by executing a note payable to a Company in the amount of $18,000, interest accrues at 6% per annum, unsecured, due September 1, 2002, and in default. Accrued interest at June 30, 2020 and December 31, 2019 is $20,340 and $19,800, respectively.

 

Also during 2002, in settlement of another trade payable, the Company executed a note payable to a Company in the amount of $30,000, interest accrues at 6% per annum, unsecured, due September 12, 2002, in default. Accrued interest at June 30, 2020 and December 31, 2019 is $31,399 and $30,499, respectively.

 

During 2000, the Company executed a note payable to an individual in the amount of $25,000, interest accrues at 5% per annum, unsecured, due August 31, 2000, in default. Accrued interest at June 30, 2020 and December 31, 2019 is $26,465 and $25,839, respectively.

 

In 2002, the Company settled an obligation with a consultant by executing a note payable for $40,000, interest accrues at 7% per annum, unsecured, due July 10, 2002, in default. Accrued interest at June 30, 2020 and December 31, 2019 is $50,887 and $49,487, respectively.

 

On December 27, 2009, the Company executed a note payable to an individual for various advances to the Company in the amount of $292,860. On June 26, 2013, this note was renegotiated to include the accrued interest. The new note balance is $388,376 and interest accrues at 5% per annum, unsecured, and is extended to October 5, 2018, with monthly installments beginning in 2014 of $5,553, which did not occur. This note is in default. Accrued interest at June 30, 2020 and December 31, 2019 is $136,198 and $126,489, respectively.

 

In January 27, 2010, the Company executed a note payable to a corporation in the amount of $192,000, bears no interest and is due on demand after 6 months of execution and is unsecured. No demand has been made at the date of these financial statements, but the note is in default. Interest expense in the amount of $3,360 has been imputed for this note for the three months ended June 30, 2020 and 2019, respectively, with an offsetting entry to Paid in Capital.

 

On August 28, 2012, and September 17, 2012, the Company executed a note payable to a corporation in the amount of $12,000 and $20,000, respectively. On June 26, 2013, this note was renegotiated to include the accrued interest. The new note balance is $32,960 and interest accrues at 5% per annum, unsecured, and is extended to October 5, 2018, with monthly installments beginning in 2014 of $473, which did not occur, and is unsecured and in default. Accrued interest at June 30, 2020 and December 31, 2019 is $11,559 and $10,735, respectively.

 

On April 12, 2012, the Company executed a note payable to a corporation in the amount of $100,000, however on June 26, 2013, this note was renegotiated to bear interest at 5% per annum, unsecured, extended to October 5, 2018, with monthly installments beginning in 2014 of $1,430, which did not occur and this note is in default. Accrued interest at June 30, 2020 and December 31, 2019 is $35,068 and $32,568, respectively.

 

On December 31, 2012, the Company executed a note payable to a corporation in the amount of $32,000, however on June 26, 2013, this note was renegotiated to include accrued interest. The new note balance is $32,746, bears interest at 5% per annum, unsecured, extended to October 5, 2018, with monthly installments beginning in 2014 of $468, which did not occur and this note is in default. Accrued interest at June 30, 2020 and December 31, 2019 is $11,482 and $10,664, respectively.

 

16

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

On March 11, 2014, the Company executed a note agreement with an LLC in the amount of $5,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, extended to October 5, 2018 and is in default. Accrued interest at June 30, 2020 and December 31, 2019 is $1,892 and $1,742, respectively.

 

On January 31, 2014, the Company executed a note agreement with a Corporation in the amount of $7,000, interest accrues at 6% per annum, unsecured, due after 8 months of execution, but extended to October 5, 2018 and is in default. Accrued interest at June 30, 2020 and December 31, 2019 is $2,694 and $2,484, respectively.

 

None of the above notes are convertible or have any covenants.

 

(b) Additional detail to all Notes Payable in Default is as follows:

 

2020     2019     Interest    

Year-to-Date

Interest Expense
       
Principal     Principal     Rate     6/30/2020     6/30/2019     Maturity  
$ 32,960       32,960       5.00 %     824       824       10/5/18  
  32,746       32,746       5.00 %     818       818       10/5/18  
  5,000       5,000       6.00 %     150       150       10/5/18  
  100,000       100,000       5.00 %     2,500       2,500       10/5/18  
  7,000       7,000       6.00 %     210       210       10/5/18  
  388,376       388,376       5.00 %     9,710       9,710       10/5/18  
  192,000       192,000       0 %     6,720       6,720       10/5/18  
  18,000       18,000       6.00 %     540       540       9/1/2002  
  30,000       30,000       6.00 %     900       900       9/12/2002  
  25,000       25,000       5.00 %     626       626       8/31/2000  
  40,000       40,000       7.00 %     1,400       1,400       7/10/2002  
                                             
$ 871,082     $ 871,082             $ 24,398     $ 24,398          

 

At June 30, 2020 and December 31, 2019, accrued interest on the outstanding notes payable were $327,984 and $310,307, respectively and related party notes was $387,321 and $298,796, respectively. Interest expense on the outstanding notes amounted to $113,004 and $49,680 for the six months ended June 30, 2020 and 2019, including the imputed interest discussed above.

 

NOTE 5 - STOCKHOLDERS’ DEFICIT

 

ISSUANCES OF COMMON STOCK

 

During the six months ended June 30, 2020 and 2019, the Company issue 4,540,000 with a fair market value of $92,301 and 5,000,000 shares with a fair market value of $262,500, respectively, for services rendered.

 

On May 18, 2020, the Company cancelled the 4,668,530 shares issued to the shareholders of ARUR, pursuant to the Chautauqua County Court Kansas decision nullifying the acquisition Agreement of ARUR (see legal actions). These shares were cancelled and returned to Treasury.

 

ISSUANCES OF PREFERRED STOCK

 

Pursuant to the Articles of Incorporation of the Company, there was initially authorized 50,000 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, 1,000 Series A Preferred shares with the following features:

 

  a) Super voting power, wherein the 1,000 shares have the right to vote in the amount equal to fifty-one percent (51%) of the total vote with respect to any proposal relating to (i) increasing the authorized share capital of the Company, and (ii) effecting any forward stock split of the Company’s authorized, issued or outstanding shares of capital stock, and (iii) any other matter subject to a shareholder vote.
     
  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.

 

OTHER

 

During the six months ended June 30, 2020 and 2019, the Company recorded imputed interest on a non-interest-bearing note in the amount of $6,720 and $6,720, respectively, as an increase in paid in capital.

 

17

 

 

GLOBAL TECH INDUSTRIES GROUP, INC.

Notes to the Unaudited Condensed Consolidated Financial Statements

June 30, 2020

 

NOTE 6 - 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. On May 18, 2020, the Company’s transfer agent cancelled the shares issued to the shareholders of ARUR, and returned them to Treasury.

 

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 fourth quarter of 2019, the Company was able to secure, via preliminary settlement, the return of 43,649,491 shares of the Company’s stock, which was issued in good faith to GoFun in anticipation of a final stock exchange. The stock was returned to the Company’s treasury and cancelled.

 

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 7 – SUBSEQUENT EVENTS

 

The Company has evaluated events subsequent to the balance sheet through the date the financial statements were issued and noted no events requiring disclosure.

 

18

 

 

NOTE 8 – RESTATEMENT OF PRIOR ISSUED FINANCIAL STATEMENTS

 

The financial statements for the three and six months ended June 30, 2019 have been restated due to an error in reporting the adoption of ASC 321, effective January 1, 2018, which requires unrealized gains and losses from marketable securities to be recorded in earnings, however, the Company erroneously recorded unrealized losses on marketable securities in the June 30, 2019 10-Q in other accumulated comprehensive income, an equity account. For comparability purposes, some reclassifications have also been made. The impact of the Restatement is as follows at June 30, 2019:

 

    Three Months Ended June 30, 2019  
    As Previously              
    Reported     Adjustment     As Restated  
Statement of Operations Data:                        
General and administrative     470,497       (170,000 )     300,497  
Compensation and professional fees     28,193       170,000       198,193  
Gain on marketable securities     -       26,306       26,307  
Interest expense     (26,356 )     (544 )     (26,900 )
Total Other Income (Expense)     (26,356 )     25,762       (594 )
Loss Before Income Taxes     (525,046 )     25,762       (499,284 )
Net Loss     (525,046 )     25,762       (499,284 )
Other Comprehensive Income (Loss)     26,308       (26,308 )     -  

 

    Six Months Ended June 30, 2019  
    As Previously              
    Reported     Adjustment     As Restated  
Statement of Operations Data:                        
General and administrative     717,815       (340,000 )     377,815  
Compensation and professional fees     58,102       340,000       398,102  
Gain on marketable securities     -       61,921       61,921  
Total Other Income (Expense)     (53,099 )     61,921       8,822  
Loss Before Income Taxes     (829,016 )     61,921       (767,095 )
Net Loss     (829,016 )     61,921       (767,095 )
Other Comprehensive Income (Loss)     61,923       (61,923 )     -  

 

    Period Ended June 30, 2019  
    As Previously              
    Reported     Adjustment     As Restated  
Balance Sheet Data:                        
Marketable securities     193,043       51,832       244,875  
Total Current Assets     196,862       51,832       248,694  
Investments     51,832       (51,832 )     -  
Unearned ESOP shares     (3,413,600 )     3,413,600       -  
Accumulated other comprehensive income     165,907       (165,907 )     -  
Accumulated (Deficit)     (163,715,270 )     (3,247,693 )     (166,962,963 )

 

    Six Months Ended June 30, 2019  
    As Previously              
    Reported     Adjustment     As Restated  
Cash Flows Data:                        
Net loss     (829,016 )     61,921       (767,095 )
Gain loss on marketable securities     -       (61,921 )     (61,921 )

 

19

 

 

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;
   
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;
   
i) insufficient revenues to cover operating costs; and

 

20

 

 

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, 2020. 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.

 

21

 

 

Employees

 

As of August 12, 2020 we have 1 full-time employee and one part time employee. We have not experienced any work stoppages and we consider relations with its employees to be good.

 

RESULTS OF OPERATIONS

 

Results of Operations for the Three Months Ended June 30, 2020 Compared to Three Months Ended June 30, 2019:

 

We realized revenues of $0 during the three months ended June 30, 2020 and 2019. Our general operating expenses decreased from $498,690 in 2019 to $306,043 in 2020. The decrease was primarily the result of decreases in travel expenses. Due to the Coronavirus, the Company executives travelled less during the second quarter 2020, due to certain restrictions.

 

Our net loss decreased by $146,646 from $(499,284) in 2019 to a loss of $(352,638) in 2020. The primary reason for this decrease was the decreased travel expenses. There was also an increase in interest expense due to the new notes to the officers and a decrease in gains on securities values. 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.

 

Results of Operations for the Six Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019:

 

We realized revenues of $0 during the six months ended June 30, 2020 and 2019. Our general operating expenses decreased from $775,917 in 2019 to $506,908 in 2020. The decrease was primarily the result of decreases in travel expenses. Due to the Coronavirus, the Company executives travelled less during the first half of 2020, due to certain restrictions.

 

Our net loss decreased by $129,611 from $(767,095) in 2019 to a loss of $(637,484) in 2020. The primary reason for this decrease was the significant decrease in travel and general and administrative expenses due to the Coronavirus pandemic. There was also an increase in interest expense due to the new notes to the officers, and less gains from securities values. 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, 2020 we had cash on hand of $1,363 compared to $1,435 at December 31, 2019. Cash used by our operations of $(90,015) in 2020 compared to cash used of $(23,641) in 2019. Our operations are supported by our CEO who uses individual credit to pay for expenses of the Company. In the first six months of 2020 our CEO advance $89,943 as compared to a net cash advance of $19,642 during 2019. We anticipate that we will continue to have a negative cash flow from operations for 2020. We do not have sufficient cash on hand at June 30, 2020 to cover our negative cash flow. We will attempt to raise capital through the sale of our common stock or through debt financing, or engaging in other operations.

 

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.

 

22

 

 

During the six months ended June 30, 2020, the Company’s working capital deficit decreased from $(2,166,033) to $(2,704,496), a decrease of 25%, due to the increase in accrued wages and accrued interest.

 

Any remedy to our current lack of liquidity must take into account all the foregoing liabilities. Global Tech intends to continue its pursuit to find other operating activities, and as necessary, raise capital in order to monetize its business and pay all its liabilities. 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 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 $(2,704,496) would cause Global Tech to default and, further, would put our continued viability in jeopardy.

 

CONTRACTUAL OBLIGATIONS

 

There are no new contractual obligations for the quarter ended June 30, 2020.

 

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, 2019. 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.

 

  23  

 

 

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, 2020.

 

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, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

Inherent Limitations over Internal Controls

 

The Company’s management does not expect that its disclosure controls or its internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of controls effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

 

Our disclosure controls and procedures are designed to provide reasonable assurance of that our reports will be accurate. Our Chief Executive Officer and Principal Accounting Officer concludes that our disclosure controls and procedures were ineffective at that reasonable assurance level, as of the end of the period covered by this Form 10-Q. Our future reports shall also indicate that our disclosure controls and procedures are designed for this reason and shall indicate the related conclusion by the Chief Executive Officer and Principal Accounting Officer as to their effectiveness.

 

Notwithstanding this finding of ineffective disclosure controls and procedures, we concluded that the consolidated financial statements included in this Form 10-Q present fairly, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with accounting principles generally accepted in the United States.

 

  24  

 

 

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. On May 18, 2020, the Company cancelled the 4,668,530 shares issued to the shareholders of ARUR and returned the shares to Treasury.

 

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, Docket No.17-CV-03727. On October 2, 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, counsel for the Company accepted previously-issued shares as full payment for all legal work, expenses, costs, and other fees.

 

  25  

 

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

There were no unregistered shares of common stock sold for cash during the six months ended June 30, 2020.

 

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  

 

  26  

 

 

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

 

EXHIBIT NO.   DESCRIPTION
     
3.1   Articles of incorporation of Tree Top Industries, as amended (1)
     
3.2   By-Laws (2)
     
10.1   Employment Agreement, dated October 1, 2007, by and between GLOBAL TECH INDUSTRIES GROUP, INC. and David Reichman (3)
     
10.2   Employment Agreement, dated April 1, 2009, by and between Tree Top Industries Inc. and Kathy Griffin (4)
     
10.3   Bridge Loan Term Sheet, dated January 11, 2010, by and between TTII and GeoGreen Biofuels, Inc. (5)
     
10.4   Business and Financial Consulting Agreement, dated February 22, 2010 by and between GLOBAL TECH INDUSTRIES GROUP, INC. and Asia Pacific Capital Corporation (6)
     
10.5   Distribution Agreement, by and between GLOBAL TECH INDUSTRIES GROUP, INC. and NetThruster, Inc., dated February 9, 2011(7)
     
10.6   Term Agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC. and Sky Corporation, doo, dated April 18, 2011 (8)

 

  27  

 

 

10.7   Term Agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC. and Adesso Biosciences, Ltd, dated October 12, 2011(9)
     
10.8   Term Agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC. and Stemcom, LLC d/b/a Pipeline Nutrition, dated March 1, 2012(10)
     
10.9   Mutual disengagement agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC. and Stemcom, LLC d/b/a Pipeline Nutrition, dated March 23, 2012(11)
     
10.10   Reserve Equity financing agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC. and AGS Capital Group, dated August 15, 2012. (12)
     
10.11   Asset purchase Agreement by and between TTII Oil & Gas, Inc. a subsidiary of GLOBAL TECH INDUSTRIES GROUP, INC. and American Resource Technologies, Inc. (13)
     
10.12   Resignation of Mr. Robert Hantman, Esq. as a member of the board of directors (14)
     
10.13   Stock Purchase Agreement by and between GLOBAL TECH INDUSTRIES GROUP, INC., G T International, Inc. and Go F & B Holdings, Ltd., dated December 30, 2016 (15)
     
10.14   Letter of Intent Agreement, dated April 12, 2019, by and between Global Tech Industries Group, Inc., First Capital Master Advisor, LLC and GCA Equity Partners, executed on or before April 12, 2019 (16)
     
21.1   Subsidiaries of the registrant
     
31.1   Section 302 Certification of Chief Executive Officer
     
31.2   Section 302 Certification of Chief Financial Officer
     
32.1   Section 906 Certification of Chief Executive Officer
     
32.2   Section 906 Certification of Chief Financial Officer

 

(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.

 

(a) Exhibits

 

  28  

 

 

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 14, 2020 GLOBAL TECH INDUSTRIES GROUP, INC.
     
  By: /s/ Frank Benintendo
   

Frank Benintendo, Acting 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/ Frank Benintendo   Dated: August 14, 2020
  Frank Benintendo, Acting Chairman of the Board, Chief    
  Executive Officer, Chief Financial Officer    
  and Principal Accounting Officer    
       
By: /s/ Kathy M. Griffin   Dated: August 14, 2020
  Kathy M. Griffin, Director, President    
       
By: /s/ Frank Benintendo   Dated: August 14, 2020
  Frank Benintendo, Director & Secretary    
       
By: /s/ Donald Gilbert   Dated: August 14, 2020
  Donald Gilbert, Director    

 

  29  

 

Global Tech Industries (QB) (USOTC:GTII)
Historical Stock Chart
From Jun 2021 to Jul 2021 Click Here for more Global Tech Industries (QB) Charts.
Global Tech Industries (QB) (USOTC:GTII)
Historical Stock Chart
From Jul 2020 to Jul 2021 Click Here for more Global Tech Industries (QB) Charts.