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EX-31.1 - CERTIFICATIONS - Purthanol Resources Ltdgbiq311.htm
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EX-31.2 - CERTIFICATIONS - Purthanol Resources Ltdgbiq312.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

  

FORM 10-Q

(Mark One)

[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended May 31, 2013

 

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to _______________

Commission File Number 000-33271

 

GLOBAL BIOTECH CORP

(Exact name of registrant as specified in its charter)

DELAWARE

(State of Incorporation)

 

98-0229951

(I.R.S. Employer Identification No.)

     

2711 Centreville Rd suite 400 Wilmington, Delaware

(Address of principal executive offices)

 

19808

(Zip Code)

(302) 288-0658

(Registrant’s telephone number, including area code)

 

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 is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated filer [ ] Accelerated Filer  [ ] Non-Accelerated Filer [ ] Smaller Reporting Company [x]

 

Indicate by check mark whether the registrant is a shell company (as determined in Rule 12b-2 of the Exchange Act). No [x]

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes [ ] No [ ]

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

As of August 28, 2013, the aggregate market value of the issuer's common stock based on its reported price on the OTC Bulletin Board held by non-affiliates of the issuer was approximately $114,903. 

 

As of August 28, 2013, the Registrant had 82,073,890 shares of Common Stock outstanding.

   
 

INDEX
 
PART I: FINANCIAL INFORMATION
 
 
Item 1. Financial Statements
 
Balance Sheets at May 31, 2013 (Unaudited), November 30, 2012
 
Statements of Operations (Unaudited) for the Three months and Six months ended May 31, 2013 and May 31, 2012 and from Inception (November 2, 1998) to May 31, 2013.
 
Statement of Cash Flows (Unaudited) for the Six months ended May 31, 2013 and May 31, 2012 and from Inception (November 2, 1998) to May 31, 2013.
 
Notes to the Financial Statements (Unaudited).
 
Item 2. Plan of Operations
 
Item 4T. Controls and Procedures
 
PART II: OTHER INFORMATION
 
Item 6. Exhibits and Reports On Form
 
SIGNATURES

 -1- 
 

GLOBAL BIOTECH CORP.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
 
   May 31,2013  November 30, 2012
     (Unaudited)       
ASSETS          
Current Assets          
Cash  $7   $7 
Prepaid Expenses   70,642    95,581 
Short Term Investments   196,084    198,160 
Total current assets   266,733    293,748 
           
Property & Equipment (Net)   86,430    86,430 
           
Total Assets  $353,163   $380,178 
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
Current Liabilities          
Bank overdraft  $—     $—   
Accounts payables  and accrued liabilities   1,080,604    972,551 
Notes Payable related party   45,613    46,352 
Note Payable   1,261,453    1,248,156 
Total current liabilities   2,387,670    2,267,059 
           
           
Stockholders' Equity          
Preferred stock, $0.0001 par value   authorized 80,000,00 shares 0 shares issued and outstanding May 31, 2013 and November 30, 2012   —      —   
Common stock,  $0.0001 par value authorized 260,000,000 shares: issued and outstanding 82,073,890 May 31, 2013 and 82,073,890 November 30, 2012   8,207    8,207 
Paid in capital   1,667,790    1,667,790 
Deficit accumulated during the development stage   (3,710,504)   (3,562,878)
Total Stockholders' Equity   (2,034,507)   (1,886,881)
           
Total liabilities and Stockholders' Equity  $353,163   $380,178 
           
See the accompanying notes to financial statements.

 -2- 
 

GLOBAL BIOTECH CORP.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(UNAUDITED)
 
   Three Months Ended May 31, 2013  Three Months Ended May 31, 2012  Six Months Ended May 31, 2013  Six Months Ended May 31, 2012  Inception to May 31, 2013
                          
                          
Revenues:  $—     $—     $—     $—     $944,811 
                          
Cost of Revenues:   —      —      —      —      603,063 
    —      —      —      —      341,748 
Operating Expenses:                         
Bad Debt Expense   —      —      —      —      120,844 
Licensing rights   —      —      —      —      700,000 
Depreciation Expense   —      —      —      —      73,274 
Marketing   —      —      —      —      236,266 
Professional Fees   2,000    2,000    4,000    4,000    229,295 
Selling, general and administrative   118,467    12,449    132,698    24,911    1,864,429 
Total Operating Expenses   120,467    14,449    136,698    28,911    3,224,108 
                          
(Loss) before other income (expense)   (120,467)   (14,449)   (136,698)   (28,911)   (2,882,360)
                          
Other income (expense):                         
Other  income   —      —                85,005 
Foreign exchange gain (loss)   —      14,137    19,262    (1,731)   (29,934)
Interest income   2,402    2,287    4,804    4,574    141,993 
Interest Expense   (17,590)   (16,864)   (34,994)   (33,762)   (543,732)
Gain on Sale of Investment   —      —      —      —      359,583 
Impairment Loss   —      —      —      —      (849,831)
Write down - leasehold improvements   —      —      —      —      (2,663)
Write down - Notes receivable   —      —      —      —      11,435 
                          
Total other income (Expense)   (15,188)   (440)   (10,928)   (30,919)   (828,144)
                          
Net (Loss)  $(135,655)  $(14,889)  $(147,626)  $(59,830)  $(3,710,504)
                          
Basic weighted average common shares outstanding   82,073,890    82,073,890    82,073,890    82,073,890      
                          
Basic (Loss) per common share  $(0.00)  $(0.00)  $(0.00)  $(0.00)     
                          
See the accompanying notes to financial statements.

 -3- 
 

GLOBAL BIOTECH CORP.
(A DEVELOPMENT STAGE COMPANY)
Statement of Cash Flows (Unaudited)
         From Inception
   Six months ended  (November 2, 1998)
   May 31, 2013  May 31,2012  to May 31, 2013
          
                
CASH FLOWS FROM OPERATING ACTIVITIES               
                
Net income (loss)   (147,626)   (59,830)  $(3,710,504)
                
Adjustments to reconcile net loss to net cash used in operating activities          
Depreciation expense   —      —      73,274 
Common stock issued for services             436,143 
Gain on sale of Investment             (359,583)
Impairment Loss   —      —      849,831 
Write down of leasehold improvements   —      —      2,663 
Write down of notes receivable   —      —      (11,435)
Accrued interest expense - note payable   34,994    33,762    434,244 
Accrued interest income - note receivable   (4,804)   (4,574)   (136,467)
Changes in operating assets and liabilities               
(Increase) Decrease  - acc. rec/Prepaids   24,939    24,934    (70,642)
(Increase) Decrease in notes receivable   6,880    —      (459,308)
Increase (decrease) - accounts payable   108,053    5,713    1,080,604 
Net Cash Provided by (used in) Operating Activities   22,436    5    (1,871,180)
                
Cash Flows from Investing Activities               
Net sale (purchase of fixed assets   —      —      (60,937)
Purchase of short term investments   —      —      (168,560)
Proceeds from sale of investment shares   —      —      489,061 
Net Cash Provided by (used in) Investing Activities   —      —      259,564 
                
Cash Flows from Financing Activities               
Bank Advances   —      —      —   
Issue of Common stock   —      —      156,262 
Payment of common stock subscription receivable   —      —      206,239 
Proceeds from notes payable & related party   (22,436)   —      1,249,122 
Net Cash provided by  (used in) Financing Activities   (22,436)   —      1,611,623 
Net Increase (Decrease) in Cash   —      5    7 
Cash at Beginning of Period   7    9    —   
Cash at End of Period  $7   $14   $7 
                
Supplemental Cash Flow Disclosures:               
Cash paid during period for interest               
Cash paid during period for taxes               
                
See accompanying notes to Financial Statements

 -4- 
 

GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

MAY 31, 2013

(UNAUDITED)

 

NOTE 1 – BASIS OF PRESENTATION

 

The accompanying unaudited financial statements of GLOBAL BIOTECH CORP. have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The financial statements reflect all adjustments consisting of normal recurring adjustments which, in the opinion of management, are necessary for a fair presentation of the results for the periods shown. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

 

These financial statements should be read in conjunction with the audited financial statements and footnotes thereto included for the year ended November 30, 2012 for GLOBAL BIOTECH CORP. on form 10 K as filed with the Securities and Exchange Commission.

 

The preparation of financial statements in conformity with generally accepted accounting principles of United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and that effect the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Earnings (Loss) Per Share

 

The Company computes net income (loss) per share in accordance with ASC 260, Earnings per Share. ASC 260 specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. Basic earnings (loss) per Common share ("EPS") calculations are determined by dividing net income (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earning per common share calculations are determined by dividing net income (loss) by the weighted average number of common shares and dilutive common share equivalents outstanding. During the periods presented common stock equivalents were not considered, as their effect would be anti-dilutive.

 

Recent Accounting Pronouncements

 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and 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.

  

NOTE 3 – GOING CONCERN

 

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The company reported net losses of $135,655 and $147,626 for the three months and six months ended May 31, 2013 as well as reporting net losses of $3,710,504 from inception (November 2, 1998) to May 31, 2013. At May 31, 2013 the Company had negative working capital of $2,120,937 and stockholders’ deficit of $2,034,507. This condition raises substantial doubt about the Company's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

The officers and directors are committed to help in raising funds to fill any operating cash flow shortages during the next fiscal year until the organization can generate sufficient funds from operations to meet current operating expenses and overhead, although there are no guarantees that this commitment will be met.

 -5- 
 

GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

MAY 31, 2013

(UNAUDITED)

 

NOTE 4. SHORT TERM INVESTMENT

 

As of May 31, 2013, the Company had purchased a term deposit in the amount of CAD172,000 (USD 166,840), bearing interest rate of 5%, maturing on November 6, 2013. As of May 31, 2013, the Company accrued 29,244 USD of interest income. No withdrawals allowed for first 90 days and 90 days early withdrawal notice needed. Early withdrawal interest rate - 1 ½%.

  

NOTE 5. PROPERTY & EQUIPMENT

 

On August 15, 2007 the Company acquired Oxygenation Equipment with a cost of $605,000 in exchange for common shares.

 

   May 31,  November 30,
   2013  2012
           
Oxygenation equipment  $605,000   $605,000 
Less: Impairment Loss   518,570    518,570 
Net Property and Equipment  $86,430   $86,430 

  

NOTE 6. NOTE PAYABLE TO RELATED PARTY

 

Note payable to related party as of May 31, 2013 and November 30, 2012 consist of the following:

   May 31, 2013  November 30,
2012
           
Due to an officer, unsecured, non-interest bearing  $45,613   $46,352 

  

NOTE 7. NOTES PAYABLE

 

Note payable as of May 31, 2013 and November 30, 2012 consist of the following:

   May 31, 2013  November 30,
2012
           
Note payable to: Millenia Hope Inc. unsecured, with annual interest rate 7%.  $629,872   $608,392 
Third parties, unsecured with annual interest of 4%, commencing July 1, 2009   105,119    107,063 
Convertible note payable  to third parties with annual interest of 2%,commencing March 1, 2011 Loan is convertible to common shares of Global Biotech at par to the lowest daily trading price of the shares on the conversion request date   207,423    213,612 
Convertible note payable  to third parties with annual interest of 8%,commencing April 30,2009 Loan is convertible to common shares of Global Biotech at the lesser of $1.00 per share or the average closing price of the shares for the 5 business days prior to conversion   319,039    319,089 
   $1,261,453   $1,248,156 

  

There are no beneficial conversion features because the Company has conversion right.

 -6- 
 

GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

MAY 31, 2013

(UNAUDITED)

 

NOTE 8. STOCKHOLDERS' EQUITY

  

The stockholders' equity section of the Company contains the following classes of capital stock as of May 31, 2013 and November 30, 2012:

 

Common stock, $ 0.0001 par value; 260,000,000 shares and 260,000,000 shares authorized May 31, 2013 and November 30, 2012: 82,073,890 shares issued and outstanding as of May 31, 2013 and November 30, 2012.

 

Preferred Stock, $0.0001 par value; 80,000,000 shares authorized May 31, 2013 and November 30, 2012. Zero (0) shares issued and outstanding as of May 31, 2013 and November 30, 2012.

 

  

NOTE 9 - SUBSEQUENT EVENTS

 

In accordance with ASC 855, Subsequent Events, the Company has evaluated subsequent events through the date of issuance of the unaudited interim financial statements. During this period, the Company did not have any material recognizable subsequent events.

 

 -7- 
 

ITEM 6 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

Special Note Regarding Forward-Looking Statements

 

Some of the statements under "Plan of Operations," "Business" and elsewhere in this registration statement are forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements about our plans, objectives, expectations, intentions and assumptions and other statements contained herein that are not statements of historical fact. You can identify these statements by words such as "may," "will," "should," "estimates," "plans," "expects," "believes," "intends" and similar expressions. We cannot guarantee future results, levels of activity, performance or achievements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. You are cautioned not to place undue reliance on any forward-looking statements.

 

Plan of Operation.

 

The following discussion should be read in conjunction with the financial statements and related notes which are included elsewhere in this prospectus. Statements made below which are not historical facts are forward-looking statements. Forward-looking statements involve a number of risks and uncertainties including, but not limited to, general economic conditions and our ability to market our product.

 

The business objective of GLOBAL is to position AquaBoost™, our initial product being offered, as a top quality oxygenated water in the specialty waters market. Our oxygenation level (up to 100 ppm and greater), the ability of our bottled water to retain this level of oxygenation, even over lengthy periods of time and the purity of our product, we believe, should give us the ability to become a staple in this specialty waters niche.

 

We have set a conservative sales objective of 4-6% of the European and American markets, or $12.5 million U.S. to $20 million U.S., by the year 2017. The fact that AquaBoost™ was seen by hundreds of distributors at the SIAL in Montreal, Canada in 2001 and that there is already a market in Mexico for the product, gives us confidence in our product. However, no assurances can be given that the Company will meet these goals.

 

The Company has held discussions with several large beverage companies about oxygenating fruit juices. Should these discussions prove successful, the Company would have another major revenue generating area. Currently, it is too premature to hazard an estimate about the likelihood of finalizing any deals with said corporations.

 

The Company will also attempt to engage in partnering with other beverage distributors or leasing its technology for royalties in those regions and for those products where it will not negatively impact on potential AquaBoost™ sales.

 

GLOBAL BIOTECH CORP. ("GLOBAL"), formerly (SWORD COMP-SOFT CORP.) was organized on November 2, 1998. Its goal was to bring interactive healthcare information services utilizing the Internet to the consumer, the end user, to access what they, as individuals, need.

 

As of March 5, 2003 this business was sold along with the assumption of a note payable in the amount of $700,000 to Millenia Hope Inc., its former parent corporation. In exchange, GLOBAL received 30.7 million shares of its outstanding common shares held by Millenia Hope Inc. Subsequently, GLOBAL acquired the exclusive 10 year North American licensing rights to a vehicle tracking system in exchange for 30.7 million of its common shares.

 

GLOBAL’s vehicle tracking system was supposed to seamlessly tie together wireless communications and the Internet with global positioning technology to link vehicles to a world of unlimited wireless services. As of February 24, 2005,GLOBAL’s Board of Directors concluded that its attempt to enter the vehicle tracking business was unsuccessful and entered into a provisional agreement, with Advanced Fluid Technologies Inc. a Delaware corporation, to acquire assets from the latter corporation pursuant to entering the bottled water, more specifically the oxygenated bottled water, market. This Agreement was finalized on August 15, 2007.

  

 -8- 
 

GLOBAL’s goal is to position AquaBoost(TM), the bottled oxygenated water product it acquired, as an energizing alternative to soft drinks and as a beverage with more health benefits than ordinary water. To date, the aforementioned product has had minimal sales and the Company will endeavor, but can offer no guarantees, to raise its sales level significantly. Officers and director of the firm have committed to fund the operations of the Company until sufficient funds have been generated from ongoing business.

 

In an effort to expand its product line, the Company is working on developing a new product that we currently refer to as “Aquaboost-VitA: Orange Antioxidant”.  This experimental product contains water oxygenated using the Aquaboost technology, vitamin C, vitamin E and apple skin extract.  The Company is in the research and testing phase of the product’s development, and is conducting research into the product’s antioxidant effects and palatability.

 

The Company’s short-term and medium-term objectives are as follows:

 

To attach our oxygenation unit in Quebec to the bottling line of a recognized North American bottler via a joint venture, said objective having been done.

To create a revenue stream through sales from strategic merchandising relationships and highly targeted markets - to this end, the Company is working on forming business relationships with pharmacy chains to place its nutraceutical beverage products in the next 6 to 12 months;

 

To strengthen its investor relations program, to increase shareholder value and increase public investors’ interest in the Company; and

To complete development of additional oxygenated and non-oxygenated drinks with nutraceutical values, which can be added to the Company’s product offering, distributed by others, or licensed to others.

  

The Company entered, on October 31, 2010, into an agreement to purchase the rights to a nutraceutical product, specifically a topical cream for women, for a period of 4 years. The total cost of said agreement was $199,467. The Company is working on marketing this product towards the end of 2013.

  

GLOBAL’s registration statement, with the Security and Exchange Commission, was accepted on July 16, 2001 and it was cleared by FINRA on June 16, 2009 to trade its shares on the OTC: BB.

  

On July 3, 2013 Mr. Leonard Stella joined the Company as its CEO and a Director.

 

On July 3, 2013 Mr. Yehuda Kops joined the Company as its CFO and a Director.

 

Three months ended May 31, 2012 compared to May 31, 2013.

 

Professional, selling, general and administrative in 2013 was $120,467 and $14,449 in 2012, a difference of $106,018. This was due to $100,000 of administrative- fees and $6,000 of car allowances in 2013.

 

We had net interest expense, on our loans, of $15,188 in 2013 and $14,577 in 2012 and $14,137 of foreign exchange gain in 2012 vs. no gain in 2013.

 

As a result of the above, we had a net loss of $135,655 in 2013 and$14,.889 in 2012.

  

Six months ended May 31, 2012 compared to May 31, 2013.

 

Professional, selling, general and administrative in 2013 was $136,698 and $28,911 in 2012, a difference of $107,787 This was due to $100,000 of administrative - fees and $6,000 of car allowances in 2013 and higher other SG&A expenses.

 

We had net interest expense, on our loans, of $30,190 in 2013 and $29,188 in 2012 and a foreign exchange loss of 1,731 in 2012 vs. $19,262 in 2013.

 

 -9- 
 

As a result of the above, we had a net loss of $147,626 in 2013 and $59,830 in 2012.

  

Liquidity and cash flow needs of the company

 

From March 1, 2013 to May 31, 2013 the company realized $22,436 from operating activities while recording no revenues. From June 1, 2013 to November 30, 2013, the fiscal year- end, the company’s net cash flow needs will be $200,000.

 

Item 4T. CONTROLS AND PROCEDURES

QUARTERLY EVALUATION OF THE COMPANY’S DISCLOSURE CONTROLS AND INTERNAL CONTROLS.

 

As of August 28, 2013, the date of the report, our Principal Executive Officer, (CEO) and Chief Financial Officer (CFO) evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rule 13a -15(e) under the Securities Exchange act of 1934, as amended. Based upon that evaluation, the Principal Executive and Financial Officer concluded that, as of May 31, 2013, the Company’s disclosure controls and procedures are effective.

 

Further, there was no change during the last quarter in the Company’s internal control over financial reporting that has materially affected or is likely to materially affect, the Company’s internal control over financial reporting. 

 -10- 
 

Part II other information

 

Item 2: Sales of Unregistered securities

 

None

 

Item (6) Reports on Form 8-K

 

Changes in Principal Officers and Directors

 

SIGNATURES

  

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

    GLOBAL BIOTECH CORP.
     
     
Date: August 29, 2013   /s/ Leonard Stella
    Leonard Stella, CEO, Director

 -11-