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, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
THE EXCHANGE ACT
For the transition period from to
Commission file number 02-69494
GLOBAL GOLD CORPORATION
(Name of small business issuer in its charter)
Delaware 13-3025550
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
438 West 37th Street, Suite 5-G, New York, New York 10018
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (212) 563-5933
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, 1996, there were 20,980,742 shares of the registrant's
Common Stock outstanding.
Transitional Small Business Disclosure Format (check one): Yes No X .
1
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TABLE OF CONTENTS
PART I. Financial Information
Item 1. Financial Statement:
Report of Independent Certified Public Accountants (unaudited)......5
Balance Sheet - March 31, 1996 (unaudited) .........................6
Statement of Income and Loss (unaudited)
for the three months ended March 31, 1996 ..........................7
Statement of Changes in Stockholders Equity
(unaudited) for the three months ended March 31, 1996 ..............8
Statement of Cash Flow (unaudited) for the three months
ended March 31, 1996 ...............................................9
Notes to Financial Statement (unaudited) ..........................10
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation ..........................................25
2
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GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
March 31, 1996
3
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Table of Contents
March 31, 1996
<TABLE>
<CAPTION>
Page
-----------------------------
<S> <C> <C>
Accountants' Compilation Report 1
Exhibit
- - ----------------------
A Balance Sheets - March 31, 1996 and December
31, 1995 2
B Statements of Income and (Loss) - For the period
January 1, 1996 through March 31, 1996 and for the
development stage period January 1, 1995
through March 31, 1996 3
C Statements of Changes in Stockholders' Equity For the
period January 1, 1996 through March 31, 1996 and for
the year January 1, 1995
through December 31, 1995 4
D Statements of Cash Flows - For the period January 1,
1996 through March 31, 1996 and for the year January
1, 1995 through December 31,
1995 5
Notes to Financial Statements 6-20
</TABLE>
4
<PAGE>
Marks
Shron
& Company, LLP
CERTIFIED PUBLIC ACCOUNTANTS
111 Great Neck Road o Great Neck o New York 11021
(516) 466-6550 o FAX (516) 466-5649
ACCOUNTANTS' COMPILATION REPORT
To the Board of Directors and Stockholders
of Global Gold Corporation
We have compiled the accompanying balance sheet of Global Gold Corporation (a
development stage company) as of March 31, 1996, and the related statements of
operations, stockholders' equity, and cash flows for the quarter then ended, in
accordance with Statements on Standards for Accounting and Review Services
issued by the American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not express
an opinion or any other form of assurance on them.
The interim financial statements for the prior fiscal year were not prepared as
if the corporation was a development stage enterprise. Accordingly, such prior
year interim statements are not included herein. For comparative purposes, the
Company is including in these financial statements, its December 31, 1995
Balance Sheet and, its Statement of Changes in Stockholders' Equity and its
Statement of Cash Flows, for the full year then ended. A development stage
entity reports profit and loss information cumulatively, from the inception of
development stage activities, which is January 1, 1995 herein. We audited the
1995 statements and a going concern opinion was rendered (as below).
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 4 to the
financial statements, management must continue to raise significant amounts of
capital in accordance with its contemplated requirements as a joint venture
partner. Furthermore, as discussed in Note 8, the executive branch of the
Armenian Government has not yet issued its consent of the joint venture. These
matters raise substantial doubt about the Company's ability to continue as a
going concern. The financial statements do not include any adjustments that
might result from the outcome of these uncertainties.
/s/ Marks Shron and Company, LLP
May 10, 1996
5
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Exhibit A
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Balance Sheets
<TABLE>
<CAPTION>
ASSETS
March 31, 1996 December 31, 1995
(Unaudited) (Audited)
----------- -----------
<S> <C> <C>
CURRENT ASSETS
Cash $ 10,971 $ 63,299
----------- -----------
NONCURRENT ASSET
Notes receivable, net of allowance for bad
debts of $120,000 - Note 10 205,000 205,000
----------- -----------
OTHER ASSETS
Organization costs 9,601 3,200
Investment in certain mining interests - Notes 6, 8 and 9 1,150,000 1,150,000
Deferred costs - Note 13 363,287 260,701
----------- -----------
1,522,888 1,413,901
----------- -----------
TOTAL ASSETS $ 1,738,859 $ 1,682,200
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Officers' compensation payable - Note 11 $ 150,000 $ 100,000
Accounts payable and accrued expenses - Note 12 309,214 195,614
Notes payable - Note 14 146,506 146,506
----------- -----------
605,720 442,120
----------- -----------
STOCKHOLDERS' EQUITY - Exhibit C
Common stock $.001 par, 100,000,000 shares authorized
20,980,742 shares issued and outstanding 20,981 20,981
Paid-in capital - Dormant period 3,228,519 3,228,519
Paid-in capital - Development stage 1,259,573 1,259,573
Retained earnings - Dormant period (2,907,648) (2,907,648)
Retained earnings - Development stage (468,286) (361,345)
----------- -----------
1,133,139 1,240,080
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,738,859 $ 1,682,200
=========== ===========
</TABLE>
See the accompanying notes and Accountants' Compilation Report.
6
<PAGE>
Exhibit B
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Statements of Income and (Loss)
January 1, 1996 January 1, 1995
through (development stage)
March 31, 1996 through
(Unaudited) March 31, 1996
----------- --------------
REVENUE $ -- $ --
--------- ---------
EXPENSES
Officers compensation - Note 17 50,000 150,000
Administrative fees 2,400 13,343
Legal 14,204 55,217
Accounting and auditing 11,423 41,025
Transfer agent and securities fees 2,337 10,868
Proxy costs 111 26,666
Office expense 210 2,915
Travel 11,594 30,679
Rent - Note 1 9,000 9,000
--------- ---------
101,279 339,713
--------- ---------
OPERATING (LOSS) (101,279) (339,713)
--------- ---------
OTHER INCOME (EXPENSES)
Interest and royalty income 4 484
Organization costs (3,200) (4,800)
Interest expense (2,290) (3,053)
Provision for bad debts - Note 10 -- (120,000)
--------- ---------
(5,486) (127,369)
--------- ---------
(LOSS) BEFORE INCOME TAXES (106,765) (467,082)
Income taxes (176) (1,204)
--------- ---------
NET (LOSS) $(106,941) $(468,286)
========= =========
NET (LOSS) PER SHARE (Note 20) $ (.0051) $ (.0384)
========= =========
See the accompanying notes and Accountants' Compilation Report.
7
<PAGE>
Exhibit C
Exhibit C
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Statements of Changes in Stockholders' Equity
<TABLE>
<CAPTION>
Paid-in Capital Retained Earnings
Shares Common Stock (Dormant Period) (Dormant Period)
------- ------------ ------------------- -------------------
<S> <C> <C> <C> <C>
Stockholders' equity
December 31, 1994 8,980,742 $ 89,807 $ 3,147,693 $(2,907,648)
Net Loss Jan. 1 - Dec. 31 -- -- -- --
Adjustment re: restatement
of par value - Note 1 -- (80,826) 80,826 --
Eyre acquisition - Note 6 10,000,000 10,000 840,000 --
Proceeds through private
offering - Note 15 2,000,000 2,000 -- --
----------- ----------- ----------- -----------
Stockholders' equity
December 31, 1995 20,980,742 $ 20,981 $ 3,228,519 $(2,907,648)
=========== =========== =========== ===========
Net Loss - January - March 31
(Exhibit B) -- -- -- --
----------- ----------- ----------- -----------
Stockholders' Equity -
March 31, 1996 20,980,742 $ 20,981 $ 3,228,519 $(2,907,648)
=========== =========== =========== ===========
<CAPTION>
Retained Earnings Paid-in Capital
(Development Stage) (Development Stage) Total
--------------------- ------------------- -----
<S> <C> <C> <C>
Stockholders' equity
December 31, 1994 $ -- $ -- $ 329,852
Net Loss Jan. 1 - Dec. 31 (361,345) (361,345)
Adjustment re: restatement
of par value - Note 1 -- -- --
Eyre acquisition - Note 6 840,000 850,000
Proceeds through private
offering - Note 15 -- 419,573 421,573
----------- ----------- -----------
Stockholders' equity
December 31, 1995 $ (361,345) $ 1,259,573 $ 1,240,080
=========== =========== ===========
Net Loss - January - March 31
(Exhibit B) (106,941) -- (106,941)
----------- ----------- -----------
Stockholders' Equity -
March 31, 1996 $ (468,286) $ 1,259,573 $ 1,133,139
=========== =========== ===========
</TABLE>
See the accompanying notes and Accountants' Compilation Report.
8
<PAGE>
Exhibit D
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Statements of Cash Flows
<TABLE>
<CAPTION>
January 1, 1996 January 1, 1995
through through
March 31, 1996 December 31, 1995
(Unaudited) (Audited)
----------- ---------
<S> <C> <C>
CASH FLOWS FROM DEVELOPMENT STAGE ACTIVITIES:
Net loss $(106,941) $(361,345)
Adjustments to reconcile net loss to net
cash provided by operating activities:
(Increase) decrease in:
Provision for bad debt included in net loss -- 120,000
Organization costs (6,401) (3,200)
Increase (decrease) in:
Accounts payable and accrued expenses 163,600 289,114
--------- ---------
Net Cash Provided by Development Stage Activities 50,258 44,569
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in certain mining interests - net of financing -- (153,494)
Deferred costs - mining interests (102,586) (260,701)
--------- ---------
Net Cash (Used) by Investing Activities (102,586) (414,195)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from private placement offering -- 421,573
--------- ---------
Net Cash Provided by Financing Activities -- 421,573
--------- ---------
NET INCREASE (DECREASE) IN CASH (52,328) 51,947
CASH - beginning 63,299 11,352
--------- ---------
CASH - end $ 10,971 $ 63,299
========= =========
SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid $ 990 $ 324
========= =========
</TABLE>
See the accompanying notes and Accountants' Compilation Report.
9
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 1: ORGANIZATION (AS A DEVELOPMENT STAGE COMPANY) AND
ACCOUNTING POLICIES
The Company was incorporated in the State of Delaware and as further
described hereafter, had no operating or development stage history
since its inception until January 1, 1995. Accordingly, the Company has
been dormant until 1995. An Australian corporation, Eyre Resources N.L.
and an affiliate (hereafter Eyre) presented to management an
opportunity to develop certain gold and copper mining rights in the
former Soviet Republics of Armenia and Georgia. These Republics, which
recently won their independence, may be prone to political and economic
turmoil which may result in various adverse ramifications.
The Company changed its name during 1995 from Triad Energy Corp. to
Global Gold Corporation, and as part of the plan to acquire the mining
interests and raise venture capital, the Company increased the number
of shares authorized to be issued from ten million to one hundred
million.
The Company has offices in New York City in premises operated by the
Company's President, Mr. Drury Gallagher and is charging rent in the
amount of $3,000 per month to the corporation for use of the premises,
office equipment, facilities, etc. commencing January 1, 1996. The
Company has not paid any employees for services, except Mr. Gallagher
and Mr. Garrison (as hereafter discussed) have been earning salaries.
During 1995, the Company formed certain-wholly owned foreign
subsidiaries. Any reference in these statements to Global (the Company)
may also include one, some, or all of the subsidiaries. All
intercompany transactions were eliminated.
The books and records are maintained on the accrual basis of
accounting.
As a result of ownership changes, the Company will not be able to
benefit from all of its net operating loss carryforwards. (Other income
tax matters - Note 18).
Management has made any necessary interim period accounting adjustments
in order for the statements not to be misleading.
10
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 2: USE OF 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 at the
balance sheet date, and also the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
NOTE 3: COMPANY HISTORY AND REPORTS WITH THE SECURITIES AND
EXCHANGE COMMISSION
The Company was incorporated on February 21, 1980, and closed a public
offering of the common stock in January 1981. Several months after the
closing of such offering, the Company withdrew the listing of the
Common Stock for trading on Nasdaq because of the theft of
substantially all of the cash funds of the Company derived from the
proceeds of a public offering by its then president, Samuel McNell in
July, 1981. The case has long since gone through the judicial system
and the McNells are no longer, officers, directors, employees or in any
other fashion doing business with the company. After the consummation
of the public offering, the Company failed to file any further annual
or periodic reports required under the Exchange Act. The company filed
its Form 10-KSB for the calendar year 1994 and its Form 10-Q for the
quarters ended March 31, 1995, June 30, 1995 and September 30, 1995,
and also filed audited financial statements covering the calendar years
1987, 1988, 1989, 1990, 1992, 1993 and 1994. There can be no assurance
that the SEC might not assert claims against the Company and its
present and former directors and officers, which actions might
adversely affect the future conduct of the Company's business or be
detrimental to future trading of the Company's stock in the public
markets.
11
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 4: DEVELOPMENT STAGE COMPANY
The Company never engaged in the active conduct of a trade or business,
and it has not generated any revenues to date, with the exception of a
negligible amount of royalty income from oil leases and interest income
derived from the funds recovered and subsequently invested by the
Company. The Company may encounter; problems, delays, expenses and
difficulties typically encountered in the development stage, many of
which may be outside of the company's control. These include, without
limitation, unanticipated problems and additional costs relating to
development, production, marketing, and competition. Management must
also be successful is securing, significant additional investor and/or
lender financing, political risk insurance, fully executed joint
venture agreements with the Republic(s), and obtaining the services of
an actual mining operator (which the Company is not). The Company
expects to incur operating losses for the near term future and, in any
event, until such time as it derives substantial revenues from the sale
of concentrates containing gold and copper, if any. Pursuant to the
documents as hereafter summarized, different mining, processing,
purifying, reprocessing and exploration endeavors are contemplated.
Where appropriate, an endeavor will commence only after successful
results of a feasibility study are rendered.
NOTE 5: ORIGINAL CONTEMPLATED TRANSACTION WITH EYRE AND AFFILIATE
The Company originally entered into a definitive asset purchase
agreement with Eyre concerning Armenian, Georgian and Australian mining
projects dated as of June 30, 1995. Under the contemplated Agreement,
the Company agreed to cause the delivery to Eyre of (i) 20,000,000
shares of its Common Stock, (ii) warrants (the "Acquisition Warrants")
to purchase 10,000,000 shares of Common Stock up to three years after
the closing and (iii) $300,000, payable in cash and notes, and (iv)
assume and discharge all liabilities of Eyre (other than certain
items). The Company agreed to issue options to Autosport (Asia) Pte,
LTD (an affiliate of Eyre) to acquire 2,000,000 shares of common stock.
In exchange, Eyre agreed to sell to the Company (or its designated
subsidiary or subsidiaries) (i) an undivided 20% interest in Eyre's
interest in two Australian exploration licenses in a lead/zinc mining
prospect known as Ediacara; (ii) all of Eyre's potential interest in
the Armenian gold mining project described herein and (iii) all of
Eyre's potential interest in the Georgian gold and copper mining
project, described herein.
12
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 6: RESTRUCTURING AGREEMENT WITH EYRE (DATED DECEMBER 1, 1995)
The contemplated Agreement (Note 5) closed effective as of December 1,
1995, and for reasons more fully described hereafter, a Restructuring
Agreement also effective as of December 1, 1995, eliminated the
acquisition of an undivided 20% interest in Eyre's interest in two
Australian exploration licenses concerning an Australian lead/zinc
mining prospect known as Ediacara.
Pursuant to the December 1, 1995 Restructuring Agreement, the Company
paid Eyre for the Armenian and Georgian interests as follows:
Cash $ 153,494
Note payable (Note 14) 100,000
Note payable (Note 14) 46,506
-----------
$ 300,000
===========
The Agreement also provided for the Company to cause the delivery to
Eyre of ten million shares of stock, with an estimated value of
$850,000, and warrants to acquire an additional four million shares
(Note 16). The Autosport options were canceled. Management believes the
restructuring leaves Global with an excess of 50% of its ownership to
be with United States entities. The Agreement also leaves Eyre with two
out of five seats on the Board of Directors.
The Company expects the restructured ownership will qualify it to
acquire political risk insurance (covering currency inconvertibility,
expropriation and political violence) as well as obtain potential
financing from the Overseas Private Investment Corporation (OPIC). OPIC
is a U.S. government agency whose purpose is to encourage American
private business investment in developing countries, newly emerging
democracies, and fledgling free market economics. At the same time,
OPIC's mission is to contribute substantially to the strength and
growth of the U.S. economy by improving American competitiveness in the
international marketplace.
13
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 6: RESTRUCTURING AGREEMENT WITH EYRE (DATED DECEMBER 1, 1995)
(continued)
A trust for the benefit of Kevin Parry and members of his family
purportedly own approximately 35% of Eyre, which has not applied for a
listing on the Australian Stock Exchange. In 1994, Mr. Parry was
criminally convicted of breaching his fiduciary duties under Australian
securities law while serving as a director of two corporations. In
1995, Mr. Parry was tried in a criminal action in the Australian courts
for allegedly misappropriating property from an entity, and found
innocent. However, management first learned of this latter action in
February, 1996, and had previously, failed to disclose the action in
the Company's proxy materials seeking approval of the Eyre Purchase
Agreement.
The Restructuring Agreement provides as additional consideration to
Eyre a 2% overriding production royalty subject to adjustment to be
applicable to the venture's revenues from the projects. The initial
Armenian tailings project (Note 8) is excluded from the royalty
arrangement. In the event Global undertakes any additional mineral
extraction projects in the Republics of Armenia or Georgia, Eyre will
receive a 1% overriding production royalty from the Company's revenues,
also subject to adjustment. Pursuant to Article V of the Restructuring
Agreement, Global shall pay to Eyre $8,333 per month to be applied
against the royalty arrangement. The Agreement shall commence with the
closing of the funding of the tailings project of the Armenian
Agreement. If Eyre is required to cancel any of it warrants (Notes 5
and 16), the royalty percentages will increase pursuant to the
documents.
The Agreement provides that Eyre may submit to the Company additional
projects, and that the Company shall in good faith consider acquiring
such projects by issuing additional shares of common stock; provided in
no event shall Eyre own or control 50% or more of the outstanding
common stock of the Company.
14
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 7: PATTERSON, BELKNAP, WEBB & TYLER
Global has retained the New York City law firm of Patterson, Belknap,
Webb & Tyler (PBWT) to represent the Company in its dealings with the
Armenian and Georgian Republics. PBWT has an international law practice
involving commercial, non-profit and humanitarian issues and has
offices in Moscow. Mr. Van Z. Krickorian (VZK), of counsel to PBWT, has
been designated to conduct the negotiations with the Republics. VZK was
formerly Armenia's Deputy Permanent Representative to the United
Nations. PBWT has advised that a formal joint venture agreement
initialed in February, 1996 requires Government approval in Armenia and
is being actively considered by the Government. A decision is expected
shortly.
In connection with preparation and negotiation of the Armenian Joint
Venture Agreement and associated documents, as well as corporate, tax,
strategic, regulatory, financing, political risk insurance and other
miscellaneous matters, PBWT shall be compensated $930,000 plus expenses
ratably over the period May 1, 1995 through May 1, 1999, with minimum
quarterly payments of $25,000. The retainer arrangement is predicated
on the total value of the deal reaching $100,000,000 (1%), and is
subject to adjustment if it falls short or exceeds that goal. In the
event the contemplated financing is not consummated, PBWT will reduce
its hourly charges by 50%. Management is accruing the base quarterly
fee of $25,000 for financial reporting purposes herein, which is
included in deferred costs.
PBWT will represent the Company in preparation and negotiation with the
Georgian Government of a revised Joint Venture Agreement and associated
documents, and other related matters similar to the aforementioned
Armenian retainer agreement. The contemplated Georgian fee is $600,000
for the period July 1, 1995 to July 1, 1999, and the minimum quarterly
payment is $10,000. Through the balance sheet date, PBWT has only
billed the Company $30,000, which is included in deferred costs. The
overall fee is subject to adjustment pursuant to the retainer
agreement. PBWT has advised that it has received information that the
subject Georgian property is actively being offered for investment
purposes to other investors. PBWT has requested from the Republic of
Georgia copies of all agreements filed with regard to the entire
"Madneuli" complex. Thereafter, the Company will pursue a more formal
legal arrangement (Note 9).
15
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 8: THE ARMENIAN JOINT VENTURE AGREEMENT
On February 2, 1996, the Company and Armgold, a division of the
Ministry of Industry of the Government of the Republic of Armenia,
initialed a Joint Venture Agreement entitled the Armenian Gold Recovery
Company. The Agreement was modified May 1, 1996. It is expected that
the executive branch of the Armenian Government will provide a decree
of consent (in the near future) to the Joint Venture. However, at the
date of this report, no such decree has been issued. VZK has advised
that the decree is not legally required for the joint venture to be
registered, but is highly desirable. The Armenian Government will
determine whether the legislative branch needs to be a party to the
decree in order for it to be issued.
Management has obtained "unofficial" estimates through Eyre and
engineers, of tonnage, ore grade, and ore recovery rates. Management
believes that a significant amount of gold has not been mined by the
Armenian Government because of inadequate capital and technologies at
their disposal. After engineering assessments are officially completed,
and if they prove successful, the Company as a joint venture partner,
will be required to provide the capital and technologies in accordance
with the Agreement.
The Venture may at times be required to obtain various approvals,
licenses, permits, etc., on a timely basis. Failure to obtain such from
the Government could materially and adversely affect the Company.
Pursuant to the May 1, 1996 Agreement, Armenia, in general, has agreed
to have the cost of the approval process be borne against their share
of the joint venture's profits.
The Venture is divided into three stages (projects). The Agreement
contemplates that successive stages of the project will be commenced in
earnest after prior stages are running successfully. At each site, the
Agreement calls for the Armenian Government to transfer to the Venture
free and clear title in the mining rights. The Company will be required
to provide administration, training, management, feasibility studies,
technology and business plans, as appropriate.
The initial stage calls for processing of tailings at Ararat. After
completion of feasibility studies and Government approval, the Company
will within one year be required to provide at least 9.5 million
dollars for the purpose of purchasing tailings processing equipment and
providing working capital to the project.
16
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 8: THE ARMENIAN JOINT VENTURE AGREEMENT (continued)
Thereafter, feasibility studies for a gold mining and tailing
operations at the Zod site will commence. Management believes
capacities at Zod will be significant. Mining at a third site,
Meghradzor, will commence once Zod is operational. Pursuant to the
joint venture agreement, preliminary feasibility studies and planning
are scheduled to commence at the Zod and Megharadzar sites, one month
and six months respectively, after the Armenian Government issues its
decree of approval of the Joint Venture.
The Company itself is not a mining operator. Accordingly, it will seek
to employ the services of a professional mining operator. The Company
may issue stock to the mining Company. In addition, Global will seek
out adequate financing and political risk insurance.
The Agreement does not specify exactly how profits are to be
calculated. Presently, it is not contemplated that the Armenian
Government will be assigned a value for their contribution of the mine
properties and rights to the venture. VZK has advised that profit
computations are still to be resolved. International or other
accounting standards have not been adapted in the joint venture
agreement. For the Ararat tailings project, once profits are
determined, they shall be split 50/50 so long as the Percentage of
Recovery of Metals Per Gram Per Ton is 70% or more. Based upon a
sliding scale, Global's profit share will increase to 66.67% if the
recovery rate declines to 50% or less. Pursuant to the work carried out
on a number of tailings samples by a research laboratory, on April 23,
1996 a consulting engineer has preliminarily suggested a separation
process that he believes will economically yield a 50% recovery rate.
The Company has reviewed the Armenian's production records, and
believes that 12 million tons are a fair approximation of the tailings
piles. Management intends to have the piles surveyed shortly. The
preliminary recommendations are being reviewed by the Joint Venture.
Armenia has permitted a tax holiday for the contemplated venture as
follows: for the first two years there shall be a complete exemption
from profits tax. For the third through the tenth year, only 50% of the
taxable income shall be taxable.
17
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 9: THE GEORGIAN AGREEMENT (Not filed)
The Company also acquired from Eyre, rights under a Foundation
Agreement dated April 22, 1995 (including a Charter for a Joint Venture
Company) with R.C.P.A. "Madneuli", a Georgian state enterprise, in
connection with carrying out certain mining of the Madneuli deposit.
The Company has been advised that the application for the license
required to be filed with the Georgian government has not been filed,
and it has no definitive agreement granting it fixed rights to mining
production or processing in Georgia. The Company intends to commence
discussions with the Government concerning the above, but has not yet
done so.
The current Agreement calls for each partner to advance capital in a
50/50 ratio (Georgia apparently is not contemplating transferring title
of mining rights to the venture). Neither international nor any other
body of accounting standards have been adapted in the joint venture
agreement. Cash flow initially is to be distributed as follows:
RCPA Madneuli 9.75%
Eyre (now the Company) 9.75%
Panquest .25%* (Georgian resource broker)
Sinking Fund .25%* (Georgia)
Capital Repayments 80.00%
*After recovery of capital costs, these percentages are to increase to
2.5%.
The Agreement calls for the Board of the Joint Venture to annually
decide upon the amount of profit distributions.
The Joint Venture shall not be required to pay Georgian income tax on
the profits obtained within the first two years after all capital and
capital costs have been repaid. In the following two years, taxation
shall be at 50% of the normal rate. Thereafter, the Venture may apply
to the Ministry of Finance for additional taxation privileges.
Reinvested capital will be exempt from taxation.
The Venture may at times be required to obtain various approvals,
licenses, permits, etc., on a timely basis. Failure to obtain such from
the Government could materially and adversely affect the Company.
18
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 10: NOTES RECEIVABLE
The Company holds notes receivable (purchased in prior years), as
follows:
<TABLE>
<CAPTION>
Amount Interest Rate Debtor
------ ------------- ------------------------------------------------
<S> <C> <C>
300,000 Prime + 2% Jet-Line Environmental Services, Inc. (Jet-Line)
25,000 (1) Envirotherm, Heating and Cooling Systems, Inc.
(Envirotherm)
(120,000)*
$205,000
</TABLE>
The Jet-Line note as more fully described in the documents, is
convertible into 15% of Jet Line's common stock, or 20% of Jet-Line's
common stock if the Company agrees to waive all accrued interest owing
it on the note. The note is due April 21, 1996, and Jet-Line has
informed the Company that it will be unable to make payment. The note
is secured by U.C.C.'s on certain equipment. Jet-Line has recently
suffered recurring operating losses and management has accordingly not
accrued interest on the Note. Jet-Line does own certain valuable
assets.
Envirotherm is engaged in manufacturing and selling geothermal heating
and cooling units, and other products. The Company began shipment of
the products in July, 1995, and is currently experiencing operating
losses. Mr. Gallagher, President of the Company, owns 4% of the common
stock of Envirotherm. The note is in default and the parties are
attempting to renegotiate the terms.
(1) No interest rate is stated. The Note increases incrementally if it
is not paid timely.
*Allowance for Doubtful Accounts (general reserve)
NOTE 11: OFFICERS' COMPENSATION PAYABLE
Officers' compensation payable consists of the following:
Drury Gallagher, President $ 75,000
Robert Garrison, Vice President 75,000
----------
$ 150,000
==========
19
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 12: ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses include the following:
Legal - General Counsel $ 50,217
Legal - Patterson, Belknap, Webb & Tyler 170,940
Audit and accounting 27,500
Other Miscellaneous 60,557
--------
$309,214
========
NOTE 13: DEFERRED COSTS
Deferred costs include the following:
Legal - Patterson, Belknap, Webb & Tyler (Note 7) $240,050
Legal - General Counsel 71,737
Engineering 24,249
Research and Analysis 17,251
Overseas travel 10,000
--------
$363,287
========
NOTE 14: NOTES PAYABLE
On December 1, 1995, the Company closed the Eyre agreement to purchase
certain mining rights (Note 6). Pursuant to the agreement, the Company
issued two $100,000 promissory notes.
The first note bears interest at 6.36% per annum, and is payable
contingent upon the Company obtaining financing of at least $2,000,000,
whether from equity, debt or a combination of both. After this
condition is met, the note is due within 10 business days.
20
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 14: NOTES PAYABLE (continued)
The second, with interest at 5.65% per annum, is payable in full no
later than September 30, 1996. An extension on this note had been
granted with the proviso that the Company will promptly prepay the note
if funds become available. As of the balance sheet date, the Company
reduced the outstanding principal to $46,506.
The stated value of the notes is their fair value.
NOTE 15: CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM
Pursuant to a Private Placement Offering dated May 17, 1995, as
amended, the Company issued $500,000 of 10% convertible senior notes
due September 30, 1996. Expenses in connection with the offering were
$78,427.
Each $1,000 convertible note entitled the holder to 4000 shares of
common stock, and warrants to purchase 8000 shares of common stock at
an exercise price of $.50 per share at any time before September 30,
1996. The expiration date was subsequently extended to December 31,
1996.
In accordance with the Offering, interest was not payable on the notes
so long as they were converted to equity within a specified time frame.
After the December 1, 1995 Eyre closing, the entire $500,000 of
convertible notes were exchanged for 2,000,000 shares of common stock.
21
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 16: WARRANTS OUTSTANDING
The Company had warrants outstanding as follows:
<TABLE>
<CAPTION>
# Shares Right Price/Share Expiration
Warrant Holder(s) to Purchase Exercisable at Date
----------------- ----------- -------------- ----
<S> <C> <C> <C>
Eyre and affiliate (1) 4,000,000 .50 11/30/98
Stockholders through
Note Conversion 4,000,000 .50 09/30/97
Other 40,000 .50 11/30/98
---------
8,040,000
=========
</TABLE>
(1) Eyre and affiliate are restricted from exercising warrants
to the extent that they will gain voting control of the
Company.
NOTE 17: OFFICERS' COMPENSATION, INCENTIVE STOCK OPTIONS AND STOCK
APPRECIATION RIGHTS
Management presently consists of Mr. Drury Gallagher and Mr. Robert
Garrison. Mr. Gallagher has been President of the Company and a
stockholder since 1981. Mr. Garrison was hired to oversee mining and
related financing activities.
Mr. Gallagher and Mr. Garrison entered into employment agreements with
the Company effective July 1, 1995. Each is entitled to receive a base
salary of $100,000 per year for 50% of their time for a three year
term. In the case of Mr. Garrison, such amount was increased to
$100,000 from $85,000 under an amendment to such an agreement dated
April 12, 1996. The Agreements call for automatic annual increases as
defined. The Board may award bonuses up to 50% of base compensation.
The compensation package also provides for the following in accordance
with the Company's 1995 Option Plan;
22
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
INCENTIVE STOCK OPTIONS
<TABLE>
<CAPTION>
Option Exercise Exercisable Expiration
# Shares Price Per Share On or After Date
------ ------ --------------- ----------- ----
<S> <C> <C> <C> <C> <C>
Drury Gallagher 1 450,000 .22 7/21/95 7/20/00
1 550,000 .22 1/21/96 7/20/00
2 81,250 .22 1/21/96 7/20/00
2 81,250 .22 7/21/96 7/20/00
2 81,250 .22 1/21/97 7/20/00
2 81,250 .22 7/21/97 7/20/00
2 81,250 .22 1/21/98 7/20/00
2 81,250 .22 7/21/98 7/20/00
3 12,500 .22 * 7/20/00
---------
1,500,000
=========
*Exercisable ratably for six six-month periods, on the same dates
corresponding to option 2. This option shall be canceled if any stock
appreciation rights are exercised.
Robert Garrison 1 195,000 .20 7/21/95 7/20/05
1 48,750 .20 1/21/96 7/20/05
1 48,750 .20 7/21/96 7/20/05
1 48,750 .20 1/21/97 7/20/05
1 48,750 .20 7/21/97 7/20/05
1 48,750 .20 1/21/98 7/20/05
1 48,750 .20 7/21/98 7/20/05
2 12,500 .20 ** 7/20/01
---------
500,000
=========
</TABLE>
**Exercisable ratably for six six-month periods, on the same dates
corresponding to option 1. This option shall be canceled if any stock
appreciation rights are exercised.
STOCK APPRECIATION RIGHTS
Mr. Gallagher and Mr. Garrison each hold rights for 500,000 units of
Common Stock which were granted at .20 per share and are each entitled
to shares based upon increased appreciation of such units at the
formula price under certain circumstances:
Percentage of units
If the company's market which are utilizable to
capitalization is between acquire shares
------------------------- --------------
$100,000,000 to 199,999,999 50.00%
$200,000,000 to 299,999,999 66.67%
$300,000,000 or more 75.00%
Mr. Gallagher and Mr. Garrison may each potentially acquire up to
375,000 shares of the Company's common stock if they have not already
exercised their rights while the market capitalization was below
$300,000,000.
23
<PAGE>
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Consolidated Financial Statements
Notes to Financial Statements
March 31, 1996
NOTE 18: NON-UNITED STATES WHOLLY OWNED SUBSIDIARIES/INCOME TAX MATTERS
On November 29, 1995, the Company formed Global Gold Armenia Limited
and Global Gold Georgia Limited, which were respectively assigned the
Armenian and Georgian mining rights from Eyre at the closing on
December 1, 1995 (Note 6). The two subsidiaries are Cayman Island
entities which were granted a twenty year tax exemption from any law of
that jurisdiction which hereafter imposes any tax to be levied on
profits, income, gains or appreciation, commencing December 19, 1995.
The off shore companies were formed in part, as a result of the
concerns of Eyre, the previous Australian owner of the mining rights,
and presently a substantial non-controlling stockholder group of the
Company, that they not be exposed to two layers of corporate taxation,
United States and Australia. The Restructuring Agreement (Note 6) which
is effective as of December 1, 1995, was not fully executed by Eyre
until April 15, 1996. The Company will obtain a tax opinion on the
transaction, which will also seek to give greater comfort to current
and future U.S. and non-U.S. shareholders, that the structure will in
fact satisfy realistic income tax goals of all concerned parties.
Inasmuch as management valued the shares of stock distributed to Eyre
in exchange for acquiring the aforementioned mining interests at $.085
per share (such interests, described herein, were not substantially
perfected at the time of the transaction), it is management's position
that even if the Internal Revenue Service deemed the transaction to be
a taxable event, there would nevertheless be insignificant income tax
consequences. However, there can be no such assurance. Furthermore, the
Company will determine that the structure will not in any way be a
deterrent from obtaining future financing or political risk insurance.
Management will consider future structural changes to the extent they
would serve as a remedy, if necessary.
NOTE 19: NET LOSS PER SHARE
Net loss per share is computed using the weighted average number of
shares outstanding during the period. Common stock equivalents have not
been included since the effect would be antidilutive.
24
<PAGE>
GLOBAL GOLD CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
GENERAL
The Company is presently engaged in the development of a gold mining
project in Armenia, and a gold and copper mining project in Georgia (both of
which countries are members of Commonwealth of Independent States). The Company
is currently in the pre-development stage and has not received any revenues from
mining activities.
During the quarter ended March 31, 1996, the Company restructured the Asset
Purchase Agreement between it and Eyre Resources N.L. dated as of June 30, 1995
(the "Asset Purchase Agreement"), effective as of December 1, 1995, which was
the closing date of the transaction contemplated thereunder, for the purchase of
assets relating to the various mining projects described above.
During the quarter ended March 31, 1996, the Company initialled the
Armenian Joint Venture Agreement (the "Armenian Agreement"), with the Ministry
of Industry of the Republic of Armenia setting forth the parties' intent to
conclude a joint venture to invest in and develop Armenia's gold mining and
processing industries and the proposed timetable for providing definitive
documentation with respect to the implementation thereof.
On May 1, 1996, the Company, the Ministry of Industry of Armenia and
Armgold, the Armenian state gold enterprise, executed and delivered the Armenian
Joint Venture Agreement. The Armenian Agreement provides for the formation of
the Armenian Gold Recovery Company which will construct, operate and market the
gold production and provide capital and financing in a multistage development of
the Armenian gold industry. The development will begin with Stage 1 which will
involve the processing of an estimated 12 million tonnes of tailings from the
Ararat processing plant averaging 1 gram of gold per tonne (based on the
Company's preliminary analysis of such tailings, although no independent
feasibility study has yet been completed) (the "Tailings Project") and the
completion of a comprehensive feasibility study and business plans for the
development of the Zod mine. Based on business plans to be approved by all
parties, Stage 2 will consist of engineering and building a gold processing
plant at the Zod mine. Stage 3 will consist of engineering and building a gold
processing plant at the Meghradzor mine.
Since the Government of Armenia is not a party to the Armenian Joint
Venture Agreement, the Company requested that the Government issue an executive
decree confirming the right of the joint venture to export gold and the power of
the Ministry of Industry of Armenia and Armgold to make the undertakings set
forth in the Armenian Joint Venture Agreement, including, without limitation,
that such Armenian parties have good title and unencumbered ownership of all
property to be transferred to such joint venture and the power to enter into the
Armenian Agreement. The Armenian Government will determine whether legislative
approval is needed in order to give its proposed decree the force of law. After
such decree is issued, the Company will have three weeks within which to post a
$250,000 bond insuring that it orders at least $5,000,000 of equipment related
to Stage 1 of the project. Pursuant to such Agreement, the Ministry of Industry
and Armgold are responsible for obtaining all further permits or decrees
25
<PAGE>
needed in connection with the project.
While the Company expects to be able to post such bond, there can be no
assurance of such result. Moreover, while the parties anticipate that the
Government of Armenia will issue the decree in question, there can be no
assurance of such result.
As of March 31, 1996, the Company was attempting to negotiate a short-term
extension of the convertible promissory note in the principal amount of $300,000
issued by Jet-Line Environmental Services, Inc. to the Company ( the "Jet-Line
Note"). On May 13, 1996, the Company and Jet-Line executed and delivered an
agreement with respect to the Jet-Line Note under which
(a) the parties extended the maturity of the Jet-Line Note until
December 31, 1996, including all unpaid accrued interest, except for the interim
interest payments described in (b) below;
(b) Jet-Line agreed to pay $2,000 a month in interest commencing with
June, 1996 through December, 1996 and, in addition, make an additional interest
payment equal to 5% of its earnings before income taxes and without regard to
depreciation and amortization, up to a ceiling amount of $7,500 per month, each
month during the above seven-month period;
(c) the parties recognized that the Jet-Line Note is convertible in
whole or in part at any time, unconditionally into 20% of common stock of
Jet-Line issued and outstanding after such conversion;
(d) Global would have the right to convert the Jet-Line Note into an
additional five percent of the issued and outstanding common stock of Jet-Line
outstanding after its conversion (thereby bringing its interest to 25% of such
stock) upon the payment of $37,500 (instead of $75,000) at the time of such
exercise; and
(e) Global also obtained the right to convert the Jet-Line Note into
an additional five percent of the Jet-Line common stock issued and outstanding
after such conversion (thereby potentially bringing its interest to 30% of such
stock) upon the payment of an additional $100,000 in cash at the time of such
exercise.
THREE MONTHS ENDED MARCH 31, 1996 COMPARED TO THREE MONTHS ENDED MARCH 31, 1995
Revenues: During the three months ended March 31, 1996 the Company's
interest and royalty income was $4, which represented a decrease from the
interest and royalty interest of $56 for the same period last year, since more
of the Company's assets were invested on a non-currently interest-paying basis.
Administrative Expenses: The Company's administrative expenses for the
three months
26
<PAGE>
ended March 31, 1996 were $106,941, which represented an increase from the
amount of $8,149 paid in same period last year. Such increase was attributable
to the Company's payment of legal and accounting fees and expenses in connection
with its retention of counsel to regularize the Company's corporate affairs, to
implement the Company's transaction with Eyre Resources N.L. pursuant to the
Asset Purchase Agreement and to file the Company's 10-KSB for the period ended
December 31, 1995.
Liquidity And Capital Resources
As at March 31, 1996, the Company's had total assets of $1,738,859, of
which $10,791 consisted of cash or cash equivalents.
The Company's plan of operation for calendar year 1996 is
(a) To obtain the execution and delivery by the Ministry of Industry of the
Government of Armenia of the Armenian Joint Venture Agreement initialled by the
Company with respect to the Tailings Project;
(b) To raise up to $12,000,000 to implement the financing of the Tailings
Project in a combination of equity and debt;
(c) To earn the right to mine production and process gold at the Zod mine
in Armenia in accordance with the terms of the Armenian Joint Venture Agreement
and, in preparation therefor, to complete the financing of the Tailings Project
and to commence an engineering feasibility study on the Zod mine;
(d) To collect payments of accrued interest and principal on and/or
restructure the $300,000 convertible note issued by Jet-Line to the Company; and
(e) To commence the public trading of the Company's Common Stock.
As of March 31, 1996, the Company had liquid assets consisting of cash of
approximately $10,000. The Company's cash requirement in 1996 in order to meet
its contractual obligations under the Tailings Project is $9,500,000 and its
cash requirement in 1996 to meet its obligations with respect to the Zod mining
project is between $500,000 and $1,000,000. Thus, without additional financing
as described herein, the Company would be unable to meet its obligations under
the Armenian Joint Venture Agreement or meet its monthly administrative expenses
which average approximately $10,000 per month (exclusive of accrued officers'
compensation), plus additional amounts for legal and accounting costs. However,
the Company expects to receive additional financing in 1996 from several sources
and on terms acceptable to it. The Company is listing below its contemplated
financing sources:
(i) Pursuant to the Offering of $500,000 principal amount of the
Convertible
27
<PAGE>
Notes of the Company pursuant to the private placement transaction which the
Company closed in 1995, the Company issued Warrants to purchase 4,000,000 shares
of its Common Stock at an exercise price of $0.50 per share. If the Warrants
were exercised in full, the Company would receive $2,000,000 in gross proceeds.
While the Company does not know with certainty whether the Warrants will be
exercised, it does anticipate that a substantial amount thereof will be
exercised, although there can be no assurance of such result.
(ii) The Company has had discussions with several parties interested
in investing directly or indirectly in the Tailings Project to be undertaken by
the Company. The Company intends to conduct additional discussions with such
parties and others, but there can be no assurance of the outcome thereof.
(iii) In addition to the above sources, the Company has had
discussions with various other financial and institutional sources with respect
to the financing of the Tailings Project and the Zod mining project. These
discussions have only been preliminary in nature.
Nevertheless, there can be no assurance that any one or more of the
financings listed above will be consummated, or, if so, on terms acceptable to
the Company. In the event that no contemplated financing is consummated, the
Company does not have sufficient financial resources, in management's opinion,
to meet its obligations as of June 30, 1996. Accordingly, Mr. Gallagher, the
President of the Company, has agreed to loan the Company such additional funds
as are needed for the Company's continued administrative needs, on an unsecured
basis, at 10% simple interest per annum payable on or before December 31, 1996
or earlier out of the proceeds of any financing by the Company of $2,000,000 or
more. Pursuant to such agreement, Mr. Gallagher loaned the Company an aggregate
of $30,000 between April 1, 1996 and the date hereof, which is evidenced by a
note.
The Company does not intend to engage in any project research and
development during 1996 and does not expect to purchase or sell any plant or
significant equipment, except as contemplated in connection with the Tailings
Project and as additionally provided in the Armenian Joint Venture Agreement.
The Company does not expect to hire any additional full-time employee in
1996.
28
<PAGE>
PART II
ITEM 1. LEGAL PROCEEDINGS
There are no material pending legal proceedings to which the Company is a
party or to which any of its property is subject.
ITEM 2. CHANGES IN SECURITIES
Not applicable.
ITEM 3. DEFAULT UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
1. (a) The following documents are filed as part of this report: Financial
Statement of the Company (unaudited), including report of independent certified
public accountants, Balance Sheet, Statement of Income, Statement of
Stockholders Equity, Statement of Cash Flow and Notes to Financial Statement as
at and for the period ended March 31, 1996.
(b) The Exhibits which are listed on the Exhibit Index attached hereto:
Not applicable.
2. No reports on Form 8-K were filed by the registrant during the period
covered by this report.
29
<PAGE>
SIGNATURES
Pursuant to the requirements 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
Dated: May 14, 1996 By:/s/ Drury J. Gallagher
Drury J. Gallagher, President
and Treasurer (Principal Executive
and Financial Officer)
30
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Global Gold Corporation Dated 3/31/96
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 10,971
<SECURITIES> 0
<RECEIVABLES> 325,000
<ALLOWANCES> 120,000
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,738,859
<CURRENT-LIABILITIES> 605,720
<BONDS> 0
0
0
<COMMON> 20,981
<OTHER-SE> 4,488,092
<TOTAL-LIABILITY-AND-EQUITY> 1,738,859
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 101,279
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,290
<INCOME-PRETAX> 0
<INCOME-TAX> 176
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (106,941)
<EPS-PRIMARY> (.005)
<EPS-DILUTED> 0
</TABLE>
