First Quarter Report 10Q
March 31, 2002
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U. S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended March 31, 2002
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from __________ to __________
Commission file 02-69494
GLOBAL GOLD CORPORATION
(Name of small business issuer in its charter)
DELAWARE 13-3025550
-------- ----------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
734 FRANKLIN AVENUE, SUITE 383, GARDEN CITY, NEW YORK 11530-4525
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (516) 627-2388
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes /X/ No / /.
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by court. Yes / / No / /. Not applicable.
As of March 31, 2002 there were 4,368,114 shares of the registrant's Common
Stock outstanding.
Transitional Small Business Disclosure Format (check one): Yes / / No /X/.
TABLE OF CONTENTS
PART I FINANACIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Balance Sheet - as of March 31, 2002 1
Statements of Operations for the three months ended
March 31, 2002 and March 31, 2001 2
Statements of Cash Flows- for the three month ended
March 31, 2002 and March 31, 2001 and for the development
stage period from January in 1995 through March 31, 2002 3
Notes to Financial Statements 4-5
Item 2. Management's Discussion and Analysis or plan of Operation 5-7
PART II OTHER INFORMATION
Item 1. Legal Proceedings 7
Item 2. Changes in Securities and Use of Proceeds 7
Item 3 Default Upon Senior Securities 7
Item 4 Submission of Matters to a Vote of Security Holders 7
Item 5 Other Information 7
Item 6. Exhibits and Reports on Form 8-K 7-8
SIGNATURE 9
GLOBAL GOLD CORPORATION
(A Development Stage Enterprise)
BALANCE SHEET
MARCH 31, 2002
(Unaudited)
ASSETS
CURRENT ASSETS
Cash $ 390
Receivable from sale of securities 9,685
----------------
10,075
OTHER ASSETS
Investment in First Dynasty Mines, Ltd. 175,000
----------------
$ 185,075
================
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 69,320
Due to related parties 35,718
----------------
105,038
----------------
STOCKHOLDERS' EQUITY:
Common stock $0.001 par, 100,000,000 shares authorized
4,368,114 shares issued and outstanding 4,368
Additional paid-in capital 4,834,955
Deficit accumulated during the development stage (4,764,450)
Unrealized gain on investment 5,164
----------------
TOTAL STOCKHOLDERS' DEFICIT 80,037
----------------
$ 185,075
================
See notes to financial statements.
1
GLOBAL GOLD CORPORATION
(A Development Stage Enterprise)
STATEMENTS OF OPERATIONS
(Unaudited)
Three months Ended January 1, 1995
March 31, through
------------------------------------ March 31,
2002 2001 2002
---------------- --------------- ---------------------
REVENUES $ - $ - $ -
---------------- --------------- ---------------------
EXPENSES:
Selling, general and administrative 3,125 5,075 775,314
Legal fees 4,564 3,655 635,859
Compensation - - 550,834
Write-off investment in Georgia
mining interests - - 135,723
Gain on sale of interest in
Global Gold Armenia - - (268,874)
Loss on sale of interest in
First Dynasty Mines, Ltd. 9,289 9,289
Miscellaneous other 100 - 18,657
---------------- --------------- ---------------------
TOTAL EXPENSES (17,078) (8,730) (1,856,802)
---------------- --------------- ---------------------
NET LOSS $ (17,078) $ (8,730) $ (1,856,802)
---------------- --------------- =====================
NET LOSS PER SHARE-BASIC AND DILUTED $ (0.00) $ (0.00)
================ ===============
WEIGHTED AVERAGE SHARES OUTSTANDING 4,368,114 4,368,114
================ ===============
See notes to financial statements
2
GLOBAL GOLD CORPORATION
(A Development Stage Enterprise)
STATEMENTS OF CASH FLOWS
(Unaudited)
Three months Ended January 1, 1995
March 31, through
-------------------------- March 31,
2,002 2,001 2002
----------- ------------ ---------------
CASH FLOWS FROM DEVELOPMENT STAGE
ACTIVITIES:
Net Loss $ (17,078) $ (8,730) $ (1,856,802)
----------- ------------ ---------------
Adjustments to reconcile net loss to net cash
used in operating activities:
Provision for bad debt - - 325,000
Gain on sale of Armenia mining interests - - (268,874)
Loss on sale of First Dynasty Mines interest 9,289 9,289
Write-off of mining investment in Georgia - - - 135,723
Changes in assets and liabilities: -
Organization costs - - (9,601)
Accounts receivable and deposits - - (154)
Accounts payable and accrued expenses (12,891) 4,750 352,641
----------- ------------ ---------------
NET CASH USED IN OPERATING ACTIVITIES (20,680) (3,980) (1,312,778)
----------- ------------ ---------------
CASH FLOW FROM INVESTING ACTIVITIES:
Proceeds from sale of Armenia mining interests - - 1,891,155
Proceeds from sale of First Dynasty Securites 7,190 - 7,190
Investment in certain mining
interests - net of financing - - (153,494)
Deferred costs - mining interests - - (878,858)
----------- ------------ ---------------
NET CASH PROVIDED BY INVESTING ACTIVITIES - - 865,993
----------- ------------ ---------------
CASH FLOW FROM FINANCING ACTIVITIES:
Net proceeds from private
placement offering - - 421,573
Advances from related party - - 13,500
Sale of warrants - - 650
Warrants exercised - - 100
----------- ------------ ---------------
NET CASH PROVIDED BY FINANCING ACTIVITIES - - 435,823
----------- ------------ ---------------
NET DECREASE IN CASH (13,490) (3,980) (10,962)
CASH - beginning of period 13,880 4,360 11,352
----------- ------------ ---------------
CASH - end of period $ 390 $ 380 $ 390
=========== ============ ===============
- -
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the year for:
Income taxes paid $ - $ - $ 2,683
=========== ============ ===============
Interest paid $ - $ - $ 15,422
=========== ============ ===============
Non-cash financing and investing activities:
Settlement of accrued salary $ - $ - $ 162,500
=========== ============ ===============
Issusance of stock in connection with
settlememt $ - $ - $ 2,000
=========== ============ ===============
Sales of investment for other receivable 9,685 - 9,685
=========== ============ ===============
See notes to financial statements.
3
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Notes to Financial Statements
March 31, 2002
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INTERIM FINANCIAL STATEMENTS:
The accompanying financial statements are unaudited. In the opinion of
management, all necessary adjustments (which include only normal
recurring adjustments) have been made to present fairly the financial
position, results of operations and cash flows for the periods
presented. Certain information and note disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these financial statements be read in conjunction with the
financial statements and notes thereto included in the December 31,
2001 annual report on Form 10-KSB. The results of operations for the
three month period ended March 31, 2002 are not necessarily indicative
of the operating results to be expected for the full year.
INVESTMENTS:
At March 31, 2002 investment in securities consisted of common stock
of First Dynasty Mines, Ltd. classified as available for sale and
stated at a quoted fair value of $175,000. The cost of the securities
was $169,836. The unrealized gain as of March 31, 2002 was $5,164
which is shown as a separate component of stockholders' deficit.
COMPREHENSIVE INCOME:
Following table show the comprehensive transactions for the three
months ending March 31, 2002 and March 31, 2001:
March 31,
----------------------------------
2002 2001
-------------- ---------------
NET LOSS $ (17,078) $ (8,730)
OTHER COMPREHENSIVE INCOME:
UNREALIZED GAIN ON AVAILABLE-
FOR-SALE SECURITIES 111,164 45,000
-------------- ---------------
COMPREHENSIVE INCOME $ 94,086 $ 36,270
============== ===============
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
When used in this discussion, the words "expect(s)", "feel(s)",
"believe(s)", "will", "may", "anticipate(s)" and similar expressions
are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties, which could cause
actual results to differ materially from those projected. Readers are
cautioned not to place undue reliance on these forward-looking
statements, and are urged to carefully review and consider the various
disclosures elsewhere in this Form 10-QSB.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2002 AND
THREE MONTHS ENDED MARCH 31, 2001
The Company had a net loss of $17,078 for the three-month period ended
March 31, 2002 representing a increase from the Loss of $8,730 for the
three-month period ended March 31, 2001.
During the three-month period January 1, 2002 through March 31, 2002,
the Company's expenses were $17,078, which represented an increase
from the expenses of $8,730 in the same period last year. The expenses
increase was primarily attributable to loss realized of $9,289 on sale
of securities for First Dynasity Mines, Ltd.
LIQUIDITY AND CAPITAL RESOURCES
As of March 31,2002, the Company's total assets were $185,075, of
which $390 consisted of cash or cash equivalents.
The Company's plan of operation for calendar year 2002 is:
(a) to investigate opportunities, and possibly implement
operations, in the mineral development and
production area; and
(b) to investigate other investment opportunities in
the mineral development and production areas.
The Company retains the right until December 31, 2009 to elect to
participate at a level of up to twenty percent with First Dynasty or
any of its affiliates in any exploration project undertaken in
Armenia.
The Company needs financing to meet its anticipated monthly
administrative expenses of $3,000 (exclusive of accrued officers'
compensation), plus additional amounts for legal and accounting costs.
The Company anticipates that it might obtain additional financing in
2002 from the holders of its Warrants to purchase 330,000 shares of
Common Stock of the Company at an exercise price of $0.25 per share,
which expire on October 31, 2003. If the Warrants were exercised in
full, the Company would receive $82,500 in gross proceeds. However,
the Company does not believe that the Warrants will be exercised under
existing circumstances, and thus it does not anticipate that any
amount thereof will be exercised, although there can be no assurance
of such result. In the event that no contemplated financing is
obtained through the exercise of the warrants (which the Company
considers highly remote), the Company does not have sufficient
financial resources to meet its obligations
The Company does not intend to engage in any research and development
during 2002 and does not expect to purchase or sell any plant or
significant equipment.
The Company does not expect to hire any additional full-time employees
in 2002.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities and Use of Proceeds
None
Item 3 Default Upon Senior Securities
None
Item 4 Submission of Matters to a Vote of Security Holders
None
Item 5 Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a)The following documents are filed as part of this report:
Financial Statements of the Company (unaudited), including
Balance Sheet, Statements of Income and Loss, Statements of
Cash Flow and Notes to Financial Statements as at and for
the three months ended March 31, 2002 and March 31, 2001 and
exhibits which are listed on the Exhibit Index attached
hereto: None
(b) The following reports on Form 8-K were filed by the
Registrant during the quarter ended March 31, 2002: None
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
GLOBAL GOLD CORPORATION
By:_________________________ May 20, 2002
------------
Drury J. Gallagher, Chairman,
Chief Executive Officer and Treasurer