The accompanying notes are
an integral part of these unaudited condensed consolidated financial statements.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
NOTE
1 - CONDENSED FINANCIAL STATEMENTS
A)
BASIS OF PRESENTATION
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, 2022, 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, 2021. The results of operations for the period ended June 30, 2022, are not necessarily
indicative of the operating results for what will be the full year ended December 31, 2022.
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 U.S. GAAP 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
impacts could occur though such potential impacts are unknown at this time.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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, Classroom Salon Holdings, LLC, 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. The Bronx and My Retina
acquisitions were rescinded effective January 1, 2022. Both parties have mutually agreed to unwind this transaction thereby they
have no impact on these financial statements.
B)
USE OF MANAGEMENT’S ESTIMATES
The
preparation of financial statements in conformity with U.S. GAAP 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. On June 30, 2022, and December 31, 2021, $104,651 and $109,143 excess cash balances existed,
respectively.
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 three and six months ended June 30, 2022 and 2021, 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 no consulting revenues 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.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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., which is expensed over the requisite service period.
G)
FAIR VALUE OF FINANCIAL INSTRUMENTS
The
Company follows ASC 820, “Fair Value Measurements,” which 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, 2022, and December 31, 2021.
Marketable
securities are reported at the quoted and listed market rates of the securities held at the period end.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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, 2022, and December 31, 2021:
SCHEDULE OF FAIR VALUE ASSETS AND LIABILITIES MEASURED ON RECURRING BASIS
| | |
Level 1 | | |
Level 2 | | |
Level 3 | |
Marketable Securities – June 30, 2022 | | |
$ | 100,000 | | |
$ | -0- | | |
$ | -0- | |
Marketable Securities – December 31, 2021 | | |
$ | 163,000 | | |
$ | -0- | | |
$ | -0- | |
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 the three and six months ended June 30, 2021
and 2022, there were 4,500,664
stock options outstanding and 23,358,496 warrants outstanding, however their effects were anti-dilutive. and there were no
potentially dilutive securities to consider in the fully diluted earnings per share calculation.
SCHEDULE OF BASIC AND DILUTED PER SHARE
| |
2022 | | |
2021 | |
| |
For the Three Months Ended | |
| |
June 30, | |
| |
2022 | | |
2021 | |
Loss (numerator) | |
$ | (977,531 | ) | |
$ | (1,102,108 | ) |
Shares (denominator) | |
| 257,142,064 | | |
| 235,044,159 | |
Basic and diluted loss per share | |
$ | (0.00 | ) | |
$ | (0.00 | ) |
| |
2022 | | |
2021 | |
| |
For the Six Months Ended | |
| |
June 30, | |
| |
2022 | | |
2021 | |
Loss (numerator) | |
$ | (2,205,903 | ) | |
$ | (1,777,850 | ) |
Shares (denominator) | |
| 256,507,508 | | |
| 233,779,672 | |
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.
J)
MARKTABLE 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.
K)
LONG LIVED ASSETS
The
Company evaluates its long-lived assets in accordance with FASB ASC 350, “Intangibles-Goodwill and Other,” and FASB
ASC 360, “Property, Plant, and Equipment.” Long-lived assets held and used by the Company are reviewed for impairment
whenever events or changes in circumstances indicate that their net book value may not be recoverable. When such factors and circumstances
exist, the Company compares the projected undiscounted future cash flows associated with the related asset or group of assets over their
estimated useful lives against their respective carrying amounts. Impairment, if any, is based on the excess of the carrying amount over
the fair value of those assets and is recorded in the period in which the determination was made.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
NOTE
3 - MARKETABLE SECURITIES
The
Company has acquired various shares of Marketable Securities. During the six months ended June 30, 2022, the Company recorded a loss
of $(63,000) which consisted of unrealized gains (losses) by marking to market, the value of the shares held. For the six months ended
June 30, 2021, the Company recorded unrealized gains of $349,000. The Company does not hold any equity securities that do not have readily
available fair values, therefore no impairment analysis or other methods to determine value are used.
NOTE
4 - FIXED ASSETS
Depreciation
expense for the six months ended June 30, 2022, and 2021 was $1,161 and $535, respectively. December 31, 2021 assets of $110,990 were
removed with the unwinding of the Bronx Eye Care Acquisition.
Fixed
assets consist of the following:
SCHEDULE OF FIXED ASSETS
| |
June 30,
2022 | | |
December 31,
2021 | |
Equipment | |
$ | 3,214 | | |
$ | 100,167 | |
Furniture and fixtures | |
| - | | |
| 14,037 | |
Total fixed assets | |
| 3,214 | | |
| 114,204 | |
Accumulated Depreciation | |
| (1,875 | ) | |
| (1,601 | ) |
Net fixed assets | |
$ | 1,339 | | |
$ | 112,603 | |
NOTE
5 - LICENSES (RESTATED)
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 DMCC1, 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, 100% of the GTI shares are to be exchanged for 6,000,000 shares of the Company’s common stock (acquisition date fair value was $10,018,085). GTI has met
its performance obligations and this transaction closed in the second quarter of 2022. The License asset was valued at $14,990,277 net
of additional liabilities recorded on the closing date of the transaction May 25,2022.
The acquisition of GTI is being treated as an
asset purchase and not business combination per ASC 805 as substantially all of the assets acquired are concentrated in a single identifiable asset. The following table summarizes the consideration transferred to acquire
GTI and the amount of identified assets, and liabilities assumed at the acquisition date.
Recognized amounts of identifiable assets acquired and liabilities assumed:
SCHEDULE OF RECOGNIZED IDENTIFIED ASSETS ACQUIRED AND LIABILITIES ASSUMED
Cash and cash equivalents | |
$ | 2,373 | |
License (including intangibles) | |
| 14,990,277 | |
Trade payables | |
| (6,388 | ) |
Note payable | |
| (4,968,177 | ) |
| |
| | |
Total identifiable net assets | |
$ | 10,018,085 | |
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 $5,000 for the license and also pays a monthly hosting
fee to Alt 5, which is expensed as incurred. The term of the license is for 12 months with an automatic renewal for an additional 12
months. This asset was sold in the second quarter of 2022. Amortization expensed through the date of sale was $2,708, respectively.
The Table below summarizes the
Company’s licenses as of June 30, 2022 and December 31, 2021:
SCHEDULE
OF LICENSE
| |
June 30, | | |
December 31, | |
License | |
2022 | | |
2021 | |
| |
| | |
| |
Access and exclusivity license | |
$ | 14,990,277 | | |
$ | - | |
Digital platform | |
| - | | |
| 5,000 | |
Total licensed assets | |
| 14,990,277 | | |
| 5,000 | |
Amortization | |
| - | | |
| (1,667 | ) |
Net licensed assets | |
$ | 14,990,277 | | |
$ | 3,333 | |
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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 2 pieces of
art for eventual digitization as a Non Fungible Token (NFT). On April 23, 2021, the Company purchased an original Picasso: “Quatre
Femmes Nues Et Tete Sculptee”, which was executed in 1934 on Montval laid paper and published by A. Vollard, Paris in 1939. The
Company paid $35,940 for this piece of fine art.
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 $31,905. The Company intends to digitalize both pieces of
fine art and issue an NFT to shareholders as a dividend, therefore, the fine art has been characterized as an other asset-not purchased
for re-sale, but rather to be held for the long term.
NOTE
7 - RELATED PARTY TRANSACTIONS
Due
to Related Parties
Due
to related parties consists of cash advances and expenses paid by Mr. Reichman 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, 2022, and 2021, Mr. Reichman
advanced $263,510 and $105,252, respectively, and was repaid $309,390 and $109,325, respectively. Additionally, there is an expense account
due Mr. Reichman of $24,000 on June 30, 2022. On June 30, 2022, and December 31, 2021, the amounts owed to Mr. Reichman are $296,180
and $105,440, 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 six months ended June 30, 2022 and 2021. The accrued wages for the six months ended June 30, 2022, and 2021 are $250,000 and
$147,500, respectively. The balance of accrued wages due to the officers on June 30, 2022, and December 31, 2021, are $885,000 and $340,000,
respectively.
NOTE
8 - 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, 2022 and December 31, 2021, notes payable in default amounted to $871,082 and $871,082, respectively. Accrued interest on the
notes in default on June 30, 2022 and December 31, 2021 are $398,697 and $387,982, 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.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
None
of the above notes are convertible or have any covenants.
(b)
Additional detail to all Notes Payable in Default is as follows:
SCHEDULE OF NOTES PAYABLE
June 39, 2022 | | |
December 31, 2021 | | |
Interest | | |
Interest Expense | | |
| |
Principal | | |
Principal | | |
Rate | | |
6/30/2022 | | |
6/30/2021 | | |
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 | | |
| | |
On
June 30, 2022, and December 31, 2021, accrued interest on the outstanding notes payable (default and current) were $398,697 and $387,982,
respectively and related party notes was $0 and $0, respectively. Interest expense on the outstanding notes amounted to $24,398 and $24,398
for the six months ended June 30, 2022, and 2021 including the imputed interest discussed below.
(c)
CONVERTIBLE DEBENTURE:
On
November 27, 2020, the Company executed a convertible debenture with a corporation in the amount of $74,800, 10% interest per annum,
unsecured, due on November 27, 2021. The debenture included a conversion right to be exercised at any time 180 days after execution of
the note and was convertible into common stock of the Company at 75% of the market price, being calculated as the lowest three trading
prices during the fifteen-trading day period prior to conversion. The Debenture also required the Company to reserve 5 times the expected
conversion share amount at the transfer agent, to ensure there were sufficient shares available upon conversion.
The
convertible debenture also contained an OID or original issue discount of $6,800, which was deducted from the proceeds, thus resulting
in $68,000 net proceeds to the Company. The Company prepaid the debenture in February 2021, it incurred a 20% pre-payment penalty, and
expensed the OID in full during 2020.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
(d)
NOTES PAYABLE
On
July 20, 2021, the Company received cash from an individual in the amount of $100,000 as a loan bearing interest at 5%, with a term of
12 months of the date received. On April 1, 2022, accrued interest on this note totaled $4,184 respectively. This loan and accrued interest
were paid off in Company stock on April 1, 2022.
On
August 6, 2021, the Company received cash from an individual in the amount of $100,000 as a loan bearing interest at 5%, with a term
of 12 months of the date received. On April 1, 2022, accrued interest on this note totaled $3,904, respectively. This loan and accrued
interest were paid off in Company stock on April 1, 2022.
On
December 31, 2021, the Company executed a note with an individual who had advanced funds throughout the year to assist management in
their cashflow needs. The total amount received at December 31, 2021 was $722,000 and an additional $50,000 in the first quarter of 2022.
The note bears interest at 6%,
with a term of 12
months from December 31, 2021. Interest will begin to accrue on January 1, 2022, therefore, there was no accrued
interest on this note at December 31, 2021. This loan and accrued interest recorded for 2022 of
$43,320
was paid off in Company stock on April 1, 2022.
In
connection with the acquisition of the License Agreement, the Company executed a Promissory Note in the amount of $5,044,610, bears interest
at 2%, is payable quarterly in graduating amounts over a 5-year period and is unsecured. On December 31, 2020, the Note Holder agreed
to delay the interest accrual until 2021 and delayed the quarterly installments six months, making the first payments due September 30, 2021. As of June 30, 2022, the balance on this loan was $4,968,177.
The
Company has debt obligations on the note as follows:
SCHEDULE
OF MATURITIES OF DEBT OBLIGATIONS
| |
1 | |
Year Due | |
Amount | |
| |
| |
2022 | |
$ | 126,477 | |
2023 | |
| 815,496 | |
2024 | |
| 1,194,638 | |
2025 | |
| 1,581,419 | |
Thereafter | |
| 1,250,147 | |
| |
| | |
Total | |
$ | 4,968,177 | |
(e)
IMPUTED INTEREST
During
the six months ended June 30, 2022, and 2021, 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 additional paid in capital.
NOTE
9 - STOCKHOLDERS’ EQUITY (DEFICIT) (RESTATED)
ISSUANCES
OF COMMON STOCK
During
the six months ended June 30, 2022, and 2021, the Company issued 1,400,247
and 14,816,995
shares of common stock with a fair market value of $1,590,918
and $1,337,724,
respectively, for services rendered. The services performed during the period were, legal, IR services, IT and consulting services
for art procurement, medical advisory and service related to a 501c charitable organization. All services performed were from
outside, unrelated third parties. The Company also issued 672,457
shares of common stock to pay off loans itemized in Note 8, accrued interest of $51,408
and payables of $80,000.
During
the first six months of 2021, 3,916,995 shares
were issued were for professional services to continue operating efforts fair market value of $1,263,474 and 750,000 shares
were issued for donations fair market value of $74,250.
In 2021, 6,000,000 shares
of common stock with a were issued and held in escrow for a stock purchase agreement of Gold Transactions international, Inc. (see
Note 5). 4,150,000 shares
were issued for the Bronx Family Eye Care acquisition and held in escrow.
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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 4,500,664 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 $.01 |
|
● |
The
conversion term is 2 years from issuance date |
|
● |
All
options are vested immediately |
Stock
option activity for the six months ended June 30, 2022, are as follows:
SCHEDULE OF STOCK OPTION
| |
| | |
Weighted | | |
Weighted | | |
| |
| |
| | |
Average | | |
Average | | |
Aggregate | |
| |
| | |
Exercise | | |
Remaining | | |
Intrinsic | |
| |
Shares | | |
Price | | |
Term | | |
Value | |
Outstanding at December 31, 2021 | |
| 4,500,664 | | |
$ | .01 | | |
| 1 yr | | |
$ | 427,563 | |
| |
| | | |
| | | |
| | | |
| | |
Granted | |
| - | | |
| - | | |
| - | | |
| - | |
Exercised | |
| - | | |
| - | | |
| - | | |
| - | |
Forfeited | |
| - | | |
| - | | |
| | | |
| - | |
Outstanding at June 30, 2022 | |
| 4,500,664 | | |
$ | .01 | | |
| .75 yrs | | |
$ | 427,563 | |
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
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 0.10 of a Warrant per share of Common Stock held of record by such holder. This agreement created
23,364,803 warrants to the shareholders of the Company as a dividend valued at $57,689,800, and recorded as a decrease in retained earnings
with the offsetting entry to paid in capital. The Warrants were issued on 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. On July 27, 2021, the Company filed an Amended Registration Statement to register the
warrants to be free trading when exercised.
SCHEDULE OF WARRANTS ISSUANCE OF FAIR VALUE ASSUMPTIONS
| |
| 2021
Warrants | |
Assumptions: | |
| | |
Assumptions applicable to stock options issued | |
| | |
Risk-free interest rate | |
| .25- | % |
Expected lives (in years) | |
| 2- | |
Expected stock volatility | |
| 266- | % |
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, 2021 | |
| 23,364,803 | | |
$ | 2.75 | | |
| 2.0 yrs | | |
$ | 57,689,800 | |
Granted | |
| - | | |
| - | | |
| - | | |
| (8,471 | ) |
Exercised | |
| (3,080 | ) | |
| 2.75 | | |
| - | | |
| - | |
Forfeited | |
| - | | |
| - | | |
| - | | |
| - | |
Outstanding at December 31, 2021 | |
| 23,361,723 | | |
$ | 2.75- | | |
| .1.25 yrs- | | |
$ | 57,681,330- | |
| |
| | | |
| | | |
| | | |
| | |
Granted | |
| - | | |
| - | | |
| - | | |
| - | |
Exercised | |
| (3,227 | ) | |
| - | | |
| - | | |
| (8,875 | ) |
Forfeited | |
| - | | |
| - | | |
| - | | |
| - | |
Outstanding at June 30, 2022 | |
| 23,358,496 | | |
$ | 2.75 | | |
| ..75 yrs | | |
$ | 57,672,455 | |
GLOBAL
TECH INDUSTRIES GROUP, INC.
Notes
to the Unaudited Condensed Consolidated Financial Statements
June
30, 2022
NOTE
10 - LEGAL ACTIONS
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 out
of the original 50,649,491 that were issued in good faith to GoFun in anticipation of a final stock exchange. That stock has been returned
to the Company’s treasury and cancelled. On May 14, 2021, the Superior Court of New Jersey, Chancery Division: Monmouth County
(docket no. PAS-MON-C-60-21) issued an order restraining the removal of restrictive legends on the remaining 7,000,000 shares of stock,
pending further order of the New Jersey Court. The underlying matter currently in the U.S. district Court for the Southern District of
New York, remains pending.
On
March 17, 2021, the Company filed an action against Pacific Technologies Group, Inc., Rollings Hills Oil and Gas Inc., Demand Brands,
Inc., Innovativ Media Group, Inc., Tom Coleman, and Bruce Hannan, in the Supreme Court of the State of New York, County of New York (Index
No. 651771/2021), alleging fraud, rescission and cancellation of a written instrument, unconscionability, breach of contract, breach
of good faith and fair dealing, unjust enrichment, and civil conspiracy. The action stems from a stock purchase agreement entered into
by the Company and Pacific Technologies Group, Inc. (then known as Demand Brands, Inc.) on October 16, 2018. On May 22, defendants filed
a motion seeking additional time to answer. As of June 30, 2022, no ruling on that motion has been entered. Need to update
On
August 16, 2021, the Company filed an action against David Wells, in the United States District Court for the Southern District of New
York (Case 1:21-cv-06891) seeking injunctive relief and relinquishment of 150,000 shares held in the name of David Wells. As of December
31, 2021, David Wells has not yet filed an answer to the Company’s complaint. On November 11, 2021, David Wells filed an action
against GTII in the United States District Court for the District of Nevada,(Case 2:21-cv-02040) claiming a violation of the duty to
register transfer of shares. As of June 30, 2022, the parties are engaged in briefing jurisdictional motions. As of current, the matter
in the state court in the southern district of New York has been dismissed; the matter in the state of Nevada court remains active.
On
August 24, 2021, the Company filed an application for a temporary restraining order (“TRO”) in the Superior Court
of New Jersey, Chancery Division: Monmouth County (Docket No.: Mon-C-132-21) seeking to restrain Liberty Stock Transfer, Inc. from
removing restrictive legends from 6,000,000
shares of Company stock held in the name of International Monetary, as well as from transferring said shares. The Court granted the
TRO effective until September 28, 2021. On September 28, 2021, the Court declined to issue any further restraints.
On September 16, 2021, International Monetary filed an action against the Company in Clark County, Nevada (Case No: A-21-841175-B)
alleging breach of contract and breach good faith and fair dealing, as well as a request for declaratory relief, and temporary restraining
order and preliminary injunction. On September 30, 2021, the Company filed a notice of removal of the action to the United States District
Court for the District of Nevada (Case 2:21-cv-01820), as well as a request for a temporary restraining order enjoining International
Monetary from taking any action to remove the restrictive legend shares from Company shares held in its name. On October 14, 2021, International
Monetary filed a motion to strike the petition for removal. As of June 30, 2022, no ruling on that motion has been entered. As of current,
the motion to remand to the federal court has been declined; the matter remains active in the Nevada state court.
NOTE
11 – RESTATEMENT OF PRIOR ISSUED FINANCIAL STATEMENTS
The
financial statements for the period ended June 30, 2022 have been restated due to an error in reporting the market value of our acquisition.
The original valuation was based on the Fair Market Value of shares issued for the acquisition on the signing of a definitive agreement
and has been changed to the Fair Market Value on the closing date of the transaction. The increase in share value resulted in an increase
in the License value acquired and a corresponding increase in Additional paid-in-capital. The impact of the Restatement is shown as
follows at June 30, 2022:
SCHEDULE OF RESTATEMENT OF PRIOR ISSUED FINANCIAL STATEMENTS
| |
Quarter Ended June 30, 2022 | | |
| |
| |
As Previously | | |
| | |
| |
| |
Reported | | |
Adjustment | | |
As Restated | |
Balance Sheet Data: | |
| | | |
| | | |
| | |
License | |
| 12,892,192 | | |
| 2,098,085 | | |
| 14,990,277 | |
Additional paid-in-capital | |
| (241,405,397 | ) | |
| (2,098,085 | ) | |
| (243,503,392 | ) |
NOTE
12 – 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 28, 2022, FINRA sent a ‘deficiency notice’ pursuant to FINRA rule 6490, whereby its Department of Market Operations
determined that the Company’s request to pay a dividend to its shareholders was deficient. It based this finding on the fact that
the Depository Trust & Clearing Corporation (DTCC) has declined to facilitate or process the distribution of the Shibu Inu Tokens
to GTII shareholders holding shares in CEDE & Co, which is a substantial portion of GTII’s outstanding common shares. The Company,
in preparation for the distribution of this digital dividend, purchased one billion Shibu Inu Tokens and set them aside to be distributed.
It also sold its interest in www.beyondblockchain.us to Alt5 Sigma in anticipation of that company processing the distribution
of the digital dividend to all shareholders who opened a digital wallet on beyondblockchain, or other digital platforms, including Bitcoin.
The Company is of the opinion that DTCC should be able to develop a process to distribute this dividend, and it is therefore in the process
of evaluating whether or not to appeal FINRA’s decision. In the meantime, the distribution of tokens will not be undertaken at
this time.