First Quarter Report 10QSB
March 31, 2007
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UNITED STATES
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, 2007
[ ] 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
(Exact name of small business issuer in its charter)
DELAWARE 13-3025550
-------- ----------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
45 East Putnam Avenue, Greenwich, CT 06830
(Address of principal executive offices)
(203) 422-2300
(Issuer's telephone number)
Not applicable
(Former name, former address and former fiscal year, if changed
since last report)
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 a court. Yes [ ] No [ ]. Not applicable.
As of May 14, 2007 there were 33,451,885 shares of the issuer's Common Stock
outstanding.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X].
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements (Unaudited)
Consolidated Balance Sheet as of March 31, 2007......................3
Consolidated Statements of Operations for the three months
ended March 31, 2007 and March 31, 2006 and for the
development stage period from January 1, 1995
(inception) through March 31, 2007 ..................................4
Consolidated Statements of Cash Flows for the three months
ended March 31, 2007 and March 31, 2006 and for the
development stage period from January 1, 1995 (inception)
through March 31, 2007 ..............................................5
Notes to Consolidated Financial Statements (Unaudited) ...........6-11
Item 2. Management's Discussion and Analysis or Plan of Operation .......11-13
Item 3. Controls and Procedures ............................................13
PART II OTHER INFORMATION
Item 1. Legal Proceedings ..................................................13
Item 2. Unregistered Sale of Equity Securities and Use of Proceeds.......13-14
Item 3 Defaults Upon Senior Securities ....................................14
Item 4 Submission of Matters to a Vote of Security Holders ................14
Item 5 Other Information ..................................................14
Item 6. Exhibits............................................................15
SIGNATURES
CERTIFICATIONS
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
GLOBAL GOLD CORPORATION AND SUBSIDIARIES
(A Development Stage Company)
UNAUDITED CONSOLIDATED BALANCE SHEET
March 31, 2007
ASSETS
CURRENT ASSETS:
Cash $ 5,551,294
Inventories 686,747
Tax refunds receivable 105,534
Other current assets 69,861
-----------------
TOTAL CURRENT ASSETS 6,413,436
LICENSES, net of accumulated amortization of $641,568 2,568,368
INVESTMENT IN IBERIAN RESOURCES STOCK 3,079,516
DEPOSITS ON CONTRACTS AND EQUIPMENT 559,015
PROPERTY, PLANT AND EQUIPMENT, net of accumulated depreciation of $330,963 1,794,680
-----------------
$ 14,415,015
=================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 736,073
Common stock issues subject to put (500,000 shares issued) 800,000
-----------------
TOTAL CURRENT LIABILITIES 1,536,073
STOCKHOLDERS' EQUITY
Common stock $0.001 par, 100,000,000 shares authorized;
33,451,885 shares issued and outstanding 32,951
Additional paid-in-capital 27,315,769
Accumulated deficit prior to development stage (2,907,648)
Deficit accumulated during the development stage (12,616,177)
Accumulated other comprehensive income 1,054,047
-----------------
TOTAL STOCKHOLDERS' EQUITY 12,878,942
-----------------
$ 14,415,015
=================
The accompanying notes are an integral part of these financial statements
3
GLOBAL GOLD CORPORATION AND SUBSIDIARIES
(A Development Stage Company)
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
Cumulative amount
from
January 1, 2007 January 1, 2006 January 1, 1995
through through through
March 31, 2007 March 31, 2006 March 31, 2007
------------------ ----------------- -------------------
REVENUES $ - $ - $ 5,985
------------------ ----------------- -------------------
EXPENSES:
General and administrative 1,327,985 321,714 10,353,492
Mine exploration costs 358,446 325,250 3,942,171
Amortization and depreciation 177,849 104,738 966,730
Write-off on investment - - 135,723
Gain on sale of investment - - (319,641)
Loss/(Gain) from investment in joint ventures - 30,156 (3,138,965)
Interest expense - 32,365 274,000
Loss/(Gain) on foreign exchange - - 70,971
Interest income (58,356) (2,135) (286,540)
------------------ ----------------- -------------------
TOTAL EXPENSES 1,805,924 812,088 11,997,941
------------------ ----------------- -------------------
Loss from Continuing Operations (1,805,924) (812,088) (11,991,956)
Discontinued Operations:
Loss from discontinued operations - - 386,413
Loss on disposal of discontinued operations - - 237,808
------------------ ----------------- -------------------
Net Loss Applicable to Common Shareholders (1,805,924) (812,088) (12,616,177)
Foreign currency translation adjustment 85,278 (13,219) 536,023
Unrealized gain on investments 121,560 - 475,035
------------------ ----------------- -------------------
Comprehensive Net Loss $ (1,599,086) $ (825,307) $ (11,605,119)
================== ================= ===================
NET LOSS PER SHARE-BASIC
AND DILUTED $ (0.05) $ (0.04)
================== =================
WEIGHTED AVERAGE SHARES
OUTSTANDING - BASIC AND DILUTED 33,439,302 18,111,034
================== =================
The accompanying notes are an integral part of these financial statements
4
GLOBAL GOLD CORPORATION AND SUBSIDIARIES
(A Development Stage Company)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
January 1, 1995
January 1, 2007 January 1, 2006 Cumulative amount
through through through
March 31, 2007 March 31, 2006 March 31, 2007
-----------------------------------------------------
OPERATING ACTIVITIES:
Net loss $ (1,805,924) $ (812,088) $ (12,616,177)
Adjustments to reconcile net loss
to net cash used in operating activities:
Amortization of unearned compensation 255,702 154,395 2,048,996
Stock option expense 307,532 - 533,426
Amortization expense 95,033 95,221 861,626
Depreciation expense 82,816 9,517 331,012
Accrual of stock bonuses issued in 2007 - - (27,950)
Write-off of investment - - 135,723
Loss on disposal of discontinued operations - - 237,808
Equity in loss on joint venture - 30,156 12,000
Gain on extinguishment of debt - - (110,423)
Gain on sale of investments (non-cash portion) - - (2,470,606)
Other non-cash expenses - 24,386 199,637
Changes in assets and liabilities:
Other current and non current assets (114,364) (7,368) (1,063,383)
Accounts payable and accrued expenses (114,909) 32,366 1,076,691
-------------- -------------- ---------------
NET CASH FLOWS USED IN OPERATING ACTIVITIES (1,294,114) (473,415) (10,851,620)
-------------- -------------- ---------------
INVESTING ACTIVITIES:
Purchase of property, plan and equipment (140,758) (3,275) (1,752,591)
Deposits on contract and equipment (115,492) - (115,492)
Proceeds from sale of Armenia mining interest - - 1,891,155
Proceeds from sale of investment in common stock of Sterlite Gold - - 246,767
Investment in joint ventures - - (260,000)
Investment in mining licenses - - (4,092,936)
-------------- -------------- ---------------
NET CASH USED IN INVESTING ACTIVITIES (256,250) (3,275) (4,083,097)
-------------- -------------- ---------------
FINANCING ACTIVITIES:
Net proceeds from private placement offering - - 17,680,104
Repurchase of common stock - - (25,000)
Due to related parties - - (22,218)
Warrants exercised - - 2,305,750
-------------- -------------- ---------------
NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES - - 19,938,636
-------------- -------------- ---------------
EFFECT OF EXCHANGE RATE ON CASH 85,278 (13,219) 536,023
-------------- -------------- ---------------
NET INCREASE (DECREASE) IN CASH (1,465,086) (489,909) 5,539,942
CASH AND CASH EQUIVALENTS - beginning of period 7,016,380 546,912 11,352
-------------- -------------- ---------------
CASH AND CASH EQUIVALENTS - end of period $ 5,551,294 $ 57,003 $ 5,551,294
============== ============== ===============
SUPPLEMENTAL CASH FLOW INFORMATION
Income taxes paid $ - $ - $ 2,683
============== ============== ===============
Interest paid $ - $ - $ 15,422
============== ============== ===============
Noncash Transactions:
Stock issued for deferred compensation $ 71,667 $ 375,000 $ 3,665,167
============== ============== ===============
Stock forfeited for deferred compensation $ - $ - $ 742,500
============== ============== ===============
Stock issued for mine acquisition $ - $ 150,000 $ 1,115,000
============== ============== ===============
Stock issued for accounts payable $ - $ - $ 25,000
============== ============== ===============
Stock issued in exchange for services $ - $ 36,000 $ -
============== ============== ===============
The accompanying notes are an integral part of these financial statements
5
GLOBAL GOLD CORPORATION
(A Development Stage Company)
Notes to Consolidated Financial Statements (Unaudited) March 31, 2007
1. ORGANIZATION, DESCRIPTION OF BUSINESS AND BASIS FOR PRESENTATION
The accompanying consolidated financial statements present the development stage
activities of the Company and its wholly owned subsidiaries from January 1,
1995, the period commencing the Company's operations as Global Gold Corporation,
through March 31, 2007.
The accompanying consolidated 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
footnote disclosure normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been condensed or omitted. However, the Company believes that the
disclosures are adequate to make the information presented not misleading. These
consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the December 31,
2006 annual report on Form 10-KSB. The results of operations for the three-month
period ended March 31, 2007 are not necessarily indicative of the operating
results to be expected for the full year ended December 31, 2007. The Company
operates in a single segment of activity, namely the acquisition of certain
mineral property, mining rights, and their subsequent development.
The consolidated financial statements at March 31, 2007, and for the period then
ended were prepared assuming that the Company would continue as a going concern.
Since its inception, the Company, a developing stage company, has generated
revenues of $5,985 (other than interest income, the proceeds from the sales of
interests in mining ventures, and the sale of common stock of marketable
securities received as consideration, therewith) while incurring losses in
excess of $11,600,000. On December 19, 2006, Global Gold Mining restructured the
Aigedzor Mining Company Joint Venture in exchange for: one million dollars; a
2.5% Net Smelter Return royalty payable on all products produced from the
Lichkvaz and Terterasar mines as well as from any mining properties acquired in
a 20 kilometer radius of the town of Aigedzor in southern Armenia; and five
million shares of Iberian Resources Limited's common stock. Management held
discussions with additional investors and institutions interested in financing
the Company's projects. However, there is no assurance that the Company will
obtain the financing that it requires or will achieve profitable operations. The
Company expected to incur additional losses for the near term until such time as
it would derive substantial revenues from the Armenian mining interests acquired
by it or other future projects. These matters raised substantial doubt about the
Company's ability to continue as a going concern. The accompanying financial
statements were prepared on a going concern basis, which contemplated the
realization of assets and satisfaction of liabilities in the normal course of
business. The accompanying consolidated financial statements at March 31, 2007
and for the period then ended did not include any adjustments that might be
necessary should the Company be unable to continue as a going concern.
The subsidiaries through which the Company operates are as follows:
On January 24, 2003, the Company formed Global Oro LLC and Global Plata LLC, as
wholly owned subsidiaries, in the State of Delaware. These companies were formed
to be equal joint owners of a Chilean limited liability company, Minera Global
Chile Limitada ("Minera Global"), formed as of May 6, 2003, for the purpose of
conducting operations in Chile.
On August 18, 2003, the Company formed Global Gold Armenia LLC ("GGA"), as a
wholly owned subsidiary, which in turn formed Global Gold Mining LLC ("Global
Gold Mining"), as a wholly owned subsidiary, both in the State of Delaware.
Global Gold Mining was qualified to do business as a branch operation in Armenia
and owns assets and shares of operating companies in Armenia.
On December 21, 2003, Global Gold Mining acquired 100% of the Armenian limited
liability company SHA, LLC (renamed Global Gold Hankavan, LLC ("GGH") as of July
21, 2006), which held the license to the Hankavan and Marjan properties in
Armenia. On January 25, 2005, GGH submitted applications to the Armenian
government for exploration licenses for five additional mineral bearing
properties in North Central Armenia, all proximate to Hankavan.
On August 1, 2005, Global Gold Mining acquired the Armenian limited liability
company Mego-Gold, LLC, which is the licensee for the Tukhmanuk mining property
and seven surrounding exploration sites.
On January 31, 2006, Global Gold Mining closed a transaction to acquire 80% of
the Armenian company, Athelea Investments, CJSC (renamed "Getik Mining Company,
LLC") and its approximately 27 square kilometer Getik gold/uranium exploration
license area in the northeast Geghargunik province of Armenia.
On January 5, 2007, the Company formed Global Gold Uranium, LLC ("Global Gold
Uranium"), as a wholly owned subsidiary, in the State of Delaware, to operate
the Company's uranium exploration activities in Canada. Global Gold Uranium was
qualified to do business in the Canadian Province of Newfoundland and Labrador.
6
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents - Cash and cash equivalents consist of all cash
balances and highly liquid investments with a remaining maturity of three months
or less when purchased and are carried at fair value.
Fair Value of Financial Instruments - The Company's financial instruments
includes cash, accounts payable, and accured expenses. The Company believes that
the carrying amounts of these accounts are reasonable estimates of their fair
value because of the short-term nature of such instruments.
Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Inventory - Inventory consists of the following:
For the three
months ended
March 31,
2007
----
Ore .................................... $ 520,146
Concentrate ............................ 16,064
Materials, supplies and other .......... 150,537
-----------
Total Inventory......................... $ 686,747
===========
Ore inventory consists of unprocessed ore at the Tukhmanuk mining site in
Armenia. The unprocessed ore is stated at the lower of cost or market.
Investment in Iberian Resources Stock - The Company classifies its existing
restricted marketable equity securities as available for sale in accordance with
SFAS No. 115. These securities are carried at fair market value. Unrealized
gains or losses of marketable securities available for sale are recognized as an
element of comprehensive income on a quarterly basis based on changes in the
fair value of the security as quoted on national or inter dealer stock
exchanges.
Deposits on Contracts and Equipment - The Company has made several deposits for
purchases, the majority of which is for the potential acquisitions of new
properties, deposits on options to acquire properties, and the remainder for the
purchase of mining equipment.
Tax Refunds Receivable - The Company is subject to Value Added Tax ("VAT tax")
on all expenditures in Armenia at the rate of 20%. The Company is entitled to a
credit against this tax towards any sales on which it collects VAT tax. The
Company is carrying a tax refund receivable based on the value of its in-process
inventory which it intends on selling in the next twelve months, at which time
they will collect 20% VAT tax from the purchaser which the Company will be
entitled to keep and apply against its credit.
Net Loss Per Share - Basic net loss per share is based on the weighted average
number of common and common equivalent shares outstanding. Potential common
shares includable in the computation of fully diluted per share results are not
presented in the consolidated financial statements as their effect would be
anti-dilutive. As of March 31, 2007 and 2006, the Company's outstanding options
were 1,245,834 and 150,000, respectively, and warrants were 6,466,666 and
2,000,000, respectively.
Stock Based Compensation - On March 1, 2006, the Company adopted Statement of
Financial Accounting Standards (SFAS) 123R, Share-Based Payment, under the
modified prospective method. As the Company had previously accounted for
stock-based compensation plans under the fair value provisions of SFAS 123, the
adoption of SFAS 123 did not significantly impact the Company's financial
position or results of operations.
During the transition period of the Company's adoption of SFAS 123R, the
weighted-average fair value of options has been estimated on the date of grant
using the Black-Scholes options-pricing model with the following
weighted-average assumptions used:
Expected Life (Years) ................. 1-3
Interest Rate ......................... 5.0-5.7%
Annual Rate of Dividends .............. 0%
Volatility ............................ 100-306%
For the three months ended March 31, 2007, net loss and loss per share reflect
the actual deduction for stock-based compensation expense. The total stock-based
compensation expense for the three months ended March 31, 2007 was $563,233. The
expense for stock-based compensation is a non-cash expense item.
7
Under the requirements of FAS 123R, the Company is not required to restate prior
period earnings, however, the Company is required to supplement its financial
statements with additional pro forma disclosures. Had compensation cost for the
Company's stock option plan been determined based on the fair value at the date
of grant, the Company's net income and basic and diluted earnings per share
would have remained the same as the pro forma amounts for the periods as
indicated below.
For the three For the three
months ended months ended
March 31, March 31,
2007 2006
---- ----
Net loss as reported ................... $(1,805,924) $ (812,088)
Deduct: Total stock-based compensation
expense determined under fair
value-based method for all
awards, net of related tax effect ..... - -
----------- -----------
Pro forma net loss ..................... $(1,805,924) $ (812,088)
=========== ===========
Basic and diluted net loss per share
as reported ........................... $ (0.05) $ (0.04)
=========== ===========
Basic and diluted pro forma net loss
per share ............................. $ (0.05) $ (0.04)
=========== ===========
Weighted average shares outstanding 33,439,302 18,111,034
=========== ===========
Principles of Consolidation - Our consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America, and include our accounts, our wholly owned
subsidiaries' accounts and a proportionate share of the accounts of the joint
ventures in which we participate. All significant inter-company balances and
transactions have been eliminated in consolidation.
Income Taxes - The Company accounts for income taxes under Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes ("SFAS No.
109"). Pursuant to SFAS No.109, the Company accounts for income taxes under the
liability method. Under the liability method, a deferred tax asset or liability
is determined based upon the tax effect of the differences between the financial
statement and tax basis of assets and liabilities as measured by the enacted
rates that will be in effect when these differences reverse.
Acquisition, Exploration and Development Costs - Mineral property acquisition,
exploration and related costs are expensed as incurred unless proven and
probable reserves exist and the property may commercially be mined. When it has
been determined that a mineral property can be economically developed, the costs
incurred to develop such property, including costs to further delineate the ore
body and develop the property for production, may be capitalized. In addition,
the Company may capitalize previously expensed acquisition and exploration costs
if it is later determined that the property can economically be developed.
Interest costs, if any, allocable to the cost of developing mining properties
and to constructing new facilities are capitalized until operations commence.
Mine development costs incurred either to develop new ore deposits, expand the
capacity of operating mines, or to develop mine areas substantially in advance
of current production are also capitalized. All such capitalized costs, and
estimated future development costs, are then amortized using the
units-of-production method over the estimated life of the ore body. Costs
incurred to maintain current production or to maintain assets on a standby basis
are charged to operations. Costs of abandoned projects are charged to operations
upon abandonment. The Company evaluates, at least quarterly, the carrying value
of capitalized mining costs and related property, plant and equipment costs, if
any, to determine if these costs are in excess of their net realizable value and
if a permanent impairment needs to be recorded. The periodic evaluation of
carrying value of capitalized costs and any related property, plant and
equipment costs are based upon expected future cash flows and/or estimated
salvage value in accordance with Statement of Financial Accounting Standards
(SFAS) No. 144, "Accounting for Impairment or Disposal of Long-Lived Assets."
Foreign Currency Translation - The assets and liabilities of non-U.S.
subsidiaries are translated into U.S. Dollars at year-end exchange rates. Income
and expense items are translated at average exchange rates during the year.
Cumulative translation adjustments are shown as a separate component of
stockholders' equity.
Depreciation, Depletion and Amortization - Capitalized costs are depreciated or
depleted using the straight-line method or units-of-production method at rates
sufficient to depreciate such costs over the shorter of estimated productive
lives of such facilities or the useful life of the individual assets. Productive
lives range from 1 to 10 years, but do not exceed the useful life of the
individual asset. Determination of expected useful lives for amortization
calculations are made on a property-by-property or asset-by-asset basis at least
annually.
8
Undeveloped mineral interests are amortized on a straight-line basis over their
estimated useful lives taking into account residual values. At such time as an
undeveloped mineral interest is converted to proven and probable reserves, the
remaining unamortized basis is amortized on a unit-of-production basis as
described above.
Impairment of Long-Lived Assets - Management reviews and evaluates the net
carrying value of all facilities, including idle facilities, for impairment at
least annually, or upon the occurrence of other events or changes in
circumstances that indicate that the related carrying amounts may not be
recoverable. We estimate the net realizable value of each property based on the
estimated undiscounted future cash flows that will be generated from operations
at each property, the estimated salvage value of the surface plant and equipment
and the value associated with property interests. All assets at an operating
segment are evaluated together for purposes of estimating future cash flows.
Concentration Risk - Financial instruments which potentially subject the Company
to concentrations of credit risk consist principally of cash. The Company places
its cash with high credit quality financial institutions in the United States,
Armenia, and Chile. As of March 31, 2007, bank deposits in the United States
exceeded federally insured limits by approximately $4,726,000. At March 31,
2007, the Company had approximately $465,000 in Armenian bank deposits and
$160,000 in Chilean bank deposits, which may not be insured. The Company has not
experienced any losses in such accounts through March 31, 2007.
The majority of the Company's present activities are in Armenia. As with all
types of international business operations, currency fluctuations, exchange
controls, restrictions on foreign investment, changes to tax regimes, political
action and political instability could impair the value of the Company's
investments.
Licenses - Licenses are capitalized at cost and are amortized on a straight-line
basis on a range from 1 to 10 years, but do not exceed the useful life of the
individual license.
Reclamation and Remediation Costs (Asset Retirement Obligations) - In January
2005, we adopted SFAS No. 143 "Accounting for Asset Retirement Obligations,"
which requires that the fair value of a liability for an asset retirement
obligation be recognized in the period in which it is incurred. SFAS No. 143
requires us to record a liability for the present value of our estimated
environmental remediation costs and the related asset created with it. The
liability will be accreted and the assets will be depreciated over the life of
the related assets. Adjustments for changes resulting from the passage of time
and changes to either the timing or amount of the original present value
estimate underlying the obligation will be made.
Costs of future expenditures for environmental remediation are not discounted to
their present value unless subject to a contractually obligated fixed payment
schedule. Such costs are based on management's current estimate of amounts to be
incurred when the remediation work is performed, within current laws and
regulations. Accordingly, no such costs were accrued at December 31, 2006.
It is possible that, due to uncertainties associated with defining the nature
and extent of environmental contamination and the application of laws and
regulations by regulatory authorities and changes in reclamation or remediation
technology, the ultimate cost of reclamation and remediation could change in the
future.
New Accounting Standards - In June 2006, the FASB issued FASB Interpretation No.
48, "Accounting for Uncertainty in Income Taxes, an Interpretation of FASB
Statement No. 109" (FIN 48). FIN 48 clarifies the accounting for uncertainty in
income taxes recognized in an enterprise's financial statements in accordance
with FAS No. 109, "Accounting for Income Taxes." FIN 48 prescribes a two-step
process to determine the amount of tax benefit to be recognized. First, the tax
position must be evaluated to determine the likelihood that it will be sustained
upon external examination. If the tax position is deemed "more-likely-than-not"
to be sustained, the tax position is then assessed to determine the amount of
benefit to recognize in the financial statements. The amount of the benefit that
may be recognized is the largest amount that has a greater than 50% likelihood
of being realized upon ultimate settlement. We were required to adopt FIN 48
effective as of January 1, 2007. We are currently evaluating the effect FIN 48
will have on our financial statements. We do not expect the impact will be
material.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements"
(Statement 157), which addresses how companies should measure fair value when
they are required to use a fair value measure for recognition or disclosure
purposes under generally accepted accounting principles. Statement 157 defines
fair value, establishes a framework for measuring fair value in generally
accepted accounting principles and expands disclosures about fair value
measurements. Statement 157 is effective for financial statements issued for
fiscal years beginning after November 15, 2007 and should be applied
prospectively, except in the case of a limited number of financial instruments
that require retrospective application. We are currently evaluating the
potential impact of Statement 157 on our financial statements. We do not expect
the impact will be material.
9
In December 2006, the FASB approved FASB Staff Position (FSP) No. EITF 00-19-2,
"Accounting for Registration Payment Arrangements" ("FSP EITF 00-19-2"), which
specifies that the contingent obligation to make future payments or otherwise
transfer consideration under a registration payment arrangement, whether issued
as a separate agreement or included as a provision of a financial instrument or
other agreement, should be separately recognized and measured in accordance with
SFAS No. 5, "Accounting for Contingencies". FSP EITF 00-19-2 also requires
additional disclosure regarding the nature of any registration payment
arrangements, alternative settlement methods, the maximum potential amount of
consideration and the current carrying amount of the liability, if any. The
guidance in FSP EITF 00-19-2 amends FASB Statements No. 133, "Accounting for
Derivative Instruments and Hedging Activities", and No. 150, "Accounting for
Certain Financial Instruments with Characteristics of both Liabilities and
Equity", and FASB Interpretation No. 45, "Guarantor's Accounting and Disclosure
requirement for Guarantees, Including Indirect Guarantees of Indebtedness of
Others", to include scope exceptions for registration payment
arrangements. FSP EITF 00-19-2 is effective immediately for registration payment
arrangements and the financial instruments subject to those arrangements that
are entered into or modified subsequent to the issuance date of this FSP, or for
financial statements issued for fiscal years beginning after December 15, 2006,
and interim periods within those fiscal years, for registration payment
arrangements entered into prior to the issuance date of this FSP. We are
currently evaluating the potential impact of FSP EITF 00-19-2 on our financial
statements. We do not expect the impact will be material.
In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities-including an amendment of FAS 115"
(Statement 159). Statement 159 allows entities to choose, at specified election
dates, to measure eligible financial assets and liabilities at fair value that
are not otherwise required to be measured at fair value. If a company elects the
fair value option for an eligible item, changes in that item's fair value in
subsequent reporting periods must be recognized in current earnings. Statement
159 is effective for fiscal years beginning after November 15, 2007. We are
currently evaluating the potential impact of Statement 159 on our financial
statements. We do not expect the impact will be material.
3. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Transactions with Officers and Directors:
On January 1, 2007, the Company entered an employment agreement with Hrayr
Agnerian, designating him as the Company's Senior Vice President for Exploration
and Development. Mr. Agnerian formerly worked at Scott Wilson Roscoe Postle
Associates Inc. (Scott Wilson RPA), and is no longer an employee of Scott Wilson
RPA. The employment agreement provides that Mr. Agnerian will receive an annual
base salary of $62,500, and is entitled to receive any bonus as determined in
accordance with any plan approved by the Board of Directors. Mr. Agnerian
resigned from the Board of Directors effective December 31, 2006. The employment
agreement is for an initial term of two years, terminating on December 31, 2008.
Pursuant to employment agreement, Mr. Agnerian was also granted (i) Eighty Three
Thousand Three Hundred Thirty Four (83,334) shares of the common stock of Global
Gold Corporation pursuant to the terms of the Restricted Stock Award to vest in
four equal installments of 20,834 shares every six months, commencing on June 1,
2007 and (ii) options to acquire Eighty Three Thousand Three Hundred Thirty Four
(83,334) shares of common stock of Company at the rate of 41,667 per year from
January 1, 2007 through January 1, 2008 (totaling 83,334) at $0.88 per share
(the arithmetic mean of the high and low prices of the Company's stock on
December 29, 2006), to vest in two equal installments of 41,667 shares each on
January 1, 2007 and January 1, 2008. The restricted stock and options are
subject to a substantial risk of forfeiture upon termination of his employment
with the Company during the term of the Agreement and the option grant was made
pursuant to the Global Gold Corporation 2006 Stock Incentive Plan.
On January 11, 2007, the Company declared a stock bonus to Dr. Urquhart of
10,000 shares of common stock at $0.86 per share for a total value of $8,600.
The Company also declared stock bonuses to 64 employees in Armenia for a total
of 20,750 shares of common stock at $0.86 per share for a total value of
$17,845. The $26,445 was included in officers' compensation and in accounts
payable and accrued expenses as of December 31, 2006.
On January 11, 2007, the Company also declared stock bonuses to 8 key employees
in Armenia for a total of 32,500 shares of common stock at $0.86 per share for a
total value of $27,950 which vest over 2 years. As of December 31, 2006, the
$27,950 was included in unearned compensation and in accounts payable and
accrued expenses.
On January 11, 2007, the Company issued as directors fees to each of the five
directors (Nicholas J. Aynilian, Drury J. Gallagher, Harry Gilmore, Ian Hague,
and Van Z. Krikorian) stock options to purchase 100,000 shares of Common Stock
of the Company each at $.86 per share. The option grants were made pursuant to
the Global Gold Corporation 2006 Stock Incentive Plan. In addition, the Company
granted 50,000 shares of restricted Common Stock to Harry Gilmore as an initial
director's fee at the fair market value of $.86 per share.
10
Cash compensation expense for the three months ended March 31, 2007 and March
31, 2006 was $277,763 and $176,500, respectively.
The amount of unearned compensation amortized for the three months ended March
31, 2007 and March 31, 2006 was $255,702 and $154,395, respectively.
4. EQUITY TRANSACTIONS - COMMON STOCK ISSUED SUBJECT TO PUT
On August 2, 2006, Global Gold Mining exercised its option to acquire the
remaining forty-nine percent (49%) of the Armenian limited liability company
Mego-Gold, LLC, which is the licensee for the Tukhmanuk mining property and
surrounding exploration sites as well as the owner of the related processing
plant and other assets in exchange for one million dollars ($1,000,000) and five
hundred thousand (500,000) restricted shares of the Company's common stock with
a contingency allowing the sellers to sell back the 500,000 shares on or before
September 15, 2007 for a payment of $1 million if the Company's stock is not
traded at or above two dollars and fifty cents ($2.50) at any time between July
1, 2007 and August 31, 2007. On September 12, 2006, Global Gold Mining loaned
two hundred thousand dollars ($200,000) to Karapet Khachatryan ("Maker"), one of
the sellers of Mego-Gold LLC, a citizen of the Republic of Armenia, as evidenced
by a convertible promissory note payable to Global Gold Mining, in lawful money
of the United States of America, with interest in arrears on the unpaid
principal balance at an annual rate equal to ten percent (10%). At any time
following September 18, 2006, the Company, at its sole option, shall have the
right to convert all of Maker's debt from the date of the Note to the date of
conversion into shares of common stock of the Company at the conversion price of
$1.50 per share with all of such shares as security for all obligations. Maker
pledged two hundred fifty five thousand (255,000) shares of the Company's common
stock as security for his obligations thereunder.
5. AGREEMENTS
On January 18, 2007, Global Gold Uranium entered into a "Labrador Uranium Claims
Agreement" with Messrs. Alexander Turpin and James Weick to acquire an option
with the right to a one hundred percent interest ownership of mineral license
rights at or near Grand Lake (approximately 1,850 acres) and Shallow Lake
(approximately 5,750 acres), both in the Canadian Province of Newfoundland and
Labrador. Global Gold Uranium will be solely responsible for exploration and
management during the option periods and can exercise the option to acquire one
hundred percent of the license rights at either property by granting the sellers
a 1.5% NSR royalty which can be bought out for $2,000,000 cash or at the
seller's option in common stock of the Company valued at the six month weighted
average of the stock a the time of exercise. All dollar references are to
Canadian dollars. Global Gold Uranium will earn a One Hundred Percent (100%)
option in the Licenses by paying cash and common stock, all as described in the
exhibit below. In addition, Global Gold Uranium has completed staking 300 claims
(approximately 18,531 acres) in the immediate vicinity of the Grand Lake and
Shallow Lake properties.
6. SUBSEQUENT EVENTS
On April 12, 2007, Global Gold Uranium entered an agreement to acquire an option
for the Cochrane Pond license area in southeastern Newfoundland, Canada (the
Agreement") with Commander Resources Ltd. ("Commander") and Bayswater Uranium
Corp. ("Bayswater"). The Cochrane Pond property consists of 2,600 claims within
61,000 hectares (approximately 150,708 acres), and a map showing the location is
available on the Global Gold website. The Agreement is subject to board approval
and the conclusion of an option agreement. The relevant boards subsequently
approved. Major terms include the following. Global Gold Uranium may earn a 51%
equity interest over a period of four years in Cochrane Pond Property by
completing:
1. Cash payments of US $700,000 over four year period.
2. Share issuance of 350,000 shares of Global Gold Corporation; 50 % each to
Commander and Bayswater over a four year period.
3. Property expenditures over four year period of C$3.5 million.
Upon Global Gold Uranium vesting 51% in the Property, Global Gold Uranium may
elect to increase its equity position to 60% by either:
a. Additional property expenditures of C$2.0 million over the following
consecutive two years, or
b. Delivering a feasibility study on the Property over the following consecutive
three years.
11
Once Global Gold Uranium has vested the Second Stage, a joint venture will be
formed, 60% as to Global Gold Uranium and 40% as to Commander and Bayswater. The
project will be funded pro-rata by parties according to their retained interest.
If either Global Gold Uranium's or the Commander/Bayswater interest is diluted
below 10%, that party's interest will convert to a royalty.
Either party may, at any time up to the commencement of commercial production,
elect to convert its respective interest to a 2% gross uranium sales royalty in
the case of a uranium deposit or a 2% NSR in the case of a non-uranium deposit.
In either case, 50% of the royalty obligation may be purchased at any time prior
to commercial production for a $1,000,000 cash payment, all as described in the
contract which was filed as an exhibit to Form 8K filed on April 12, 2007.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
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. The provision of Section 27A
of the Securities Act of 1933 and Section 21 of the Securities and Exchange Act
of 1934 shall apply to any forward looking information in this Form 10-QSB.
RESULTS OF OPERATIONS
THREE-MONTHS ENDED MARCH 31, 2007 AND THREE-MONTHS ENDED MARCH 31, 2006
During the three-month period ended March 31, 2007, the Company's administrative
and other expenses were $1,327,985 which represented an increase of $1,006,271
from $321,714 in the same period last year. The expense increase was primarily
attributable to higher cash compensation expense of $101,263, stock compensation
expense of $101,307, option expense of $307,532, accounting expenses of $15,680,
travel expense of $26,769 and legal expenses of $271,280.
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 2007, the Company's total assets were $14,415,015, of which
$5,551,294 consisted of cash or cash equivalents.
The Company's plan of operation for at least the twelve months ending March 31,
2007:
(a) To develop the Tukhmanuk, Getik, Hankavan, and Marjan mining properties in
Armenia and to engage in further exploration in Armenia, Chile and Canada to
generate cash flow and establish gold, uranium, copper, and molybdenum reserves
to Western standards;
(b) To review and acquire additional mineral bearing properties in the Former
Soviet Union, Chile, and North America; and
(c) Pursue additional financing through private placements and joint ventures.
The Company retains the right until December 31, 2009 to elect to participate at
a level of up to twenty percent with Sterlite Gold Ltd. or any of its affiliates
in any exploration project undertaken in Armenia. On October 2, 2006, Vendanta
Resourcs Plc announced that its tender to take control of Sterlite Gold Ltd. was
successful which makes it a successor to the twenty percent obligation of
Sterlite Gold Ltd.
The Company retains the right to participate up to 20% in any new projects
undertaken by Iberian Resources Limited or its affiliates in Armenia until
August 15, 2015. In addition, the Company has a 2.5% NSR royalty on production
from the Lichkvaz-Tei and Terterasar mines as well as from any mining properties
in a 20 kilometer radius of the town of Aigedzor in southern Armenia. On
February 28, 2007, Iberian Resources Limited announced it is merging with Tamaya
Resources Limited.
At Tukhmanuk, approval for a new tailings dam has been granted, with
construction commencing in the 2nd Quarter of 2007, and the processing plant is
being upgraded. A new assay lab has been equipped and is operational.
Approximately 13,000 meters of drilling have been completed. The purpose of this
drill program was to confirm the Armenian state committee on reserves records.
Analysis of the drill program is not expected to be complete until the 3rd
Quarter of 2007. Based on preliminary analysis, it is anticipated that Tukhmanuk
may include a wider zone of mineralization to be bulk mined, rather than a
higher grade narrow vein underground operation as the initial reports indicated.
12
GGH, which is the license holder for the Hankavan and Marjan properties, has
continued to be the subject of corrupt and improper demands and threats from the
Minister of the Ministry of Environment and Natural Resources, Vartan Ayvazyan.
The Company has reported this situation to the appropriate authorities in
Armenia and in the United States. Although the Minister has taken the position
that the licenses at Hankavan and Marjan have been terminated, other Armenian
governmental officials have assured the Company to the contrary and Armenian
public records confirm the continuing validity of the licenses. The Company has
received independent legal opinions that all of its licenses are valid and
remain in full force and effect, continues to work at those properties, and has
engaged international and local counsel to pursue prosecution of the illegal and
corrupt practices directed against the subsidiary, including international
arbitration. On November 7, 2006, the Company initiated the thirty-day good
faith negotiating period (which is a prerequisite to filing for international
arbitration under the 2003 SHA, LLC Share Purchase Agreement) with the three
named shareholders and one previously undisclosed principal. The Company filed
for arbitration under the rules under the International Chamber of Commerce,
headquartered in Paris, France, ("ICC") on December 29, 2006. The forum for this
arbitration is New York City. Damages will be determined during the arbitration
proceedings. In addition and based on the US Armenia Bilateral Investment
Treaty, Global Gold Mining filed a request for arbitration against the Republic
of Armenia for the actions of the Minister of Environment and Natural Resources
with the International Centre for Settlement of Investment Disputes, which is a
component agency of the World Bank in Washington, D.C., ("ICSID") on January 29,
2007. Damages will be determined during the arbitration proceedings. The
Ministry of Environment has also sent a notice to terminate Global Gold Mining's
license at Getik. Global Gold Mining continues to work at this property and will
oppose any attempt to terminate this license.
The Company has previously reported that it is aware that another company has
been using a similar name in the CIS and counsel has received assurances the
other company would cease using the similar name and that company was in the
process of changing its name. That company has now provided official
documentation that it has changed its name to one that is not similar to Global
Gold.
The Company also anticipates spending additional funds in Armenia, Canada and
Chile for further exploration and development of its other properties as well as
acquisition of new properties. The Company is also reviewing new technologies in
exploration and processing. The Company anticipates that it will issue
additional equity or debt to finance its planned activities. The Company
anticipates that it might obtain
additional financing from the holders of its Warrants to purchase 2,000,000
million shares of Common Stock of the Company at an exercise price of $1.42 per
share, which expire on July 31, 2007. If these Warrants were exercised in full,
the Company would receive $2,840,000 in gross proceeds. In addition, the Company
anticipates that it might obtain additional financing from the holders of its
Warrants to purchase 4,466,666 million shares of Common Stock of the Company at
an exercise price of $2.00 per share, which expire on April 1, 2008. If these
Warrants were exercised in full, the Company would receive $8,933,332 in gross
proceeds.
The Company may engage in research and development related to exploration and
processing during 2007, does not expect to sell any plant or significant
equipment but it does anticipate purchasing processing plant and equipment
assets.
The Company has been able to continue based upon its receipt of funds from the
issuance of equity securities and shareholder loans, and by acquiring assets or
paying expenses by issuing stock. The Company's continued existence is dependent
upon its continued ability to raise funds through the issuance of securities.
Management's plans in this regard are to obtain other financing until profitable
operation and positive cash flow are achieved and maintained. Although
management believes that it will be able to secure suitable additional financing
for the Company's operations, there can be no assurances that such financing
will continue to be available on reasonable terms, or at all.
Item 3. Controls and Procedures.
As of the end of the period covered by this report, an evaluation was carried
out under the supervision and with the participation of the Company's Chief
Executive Officer and Chief Financial Officer of the effectiveness of our
disclosure controls and procedures (as defined in Rules 13a-14 and 15d-14 under
the Securities Exchange Act of 1934). Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer have concluded that the Company's
disclosure controls and procedures are effective to ensure that information
required to be disclosed by the Company in reports that it files or submits
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange Commission
rules and forms. Subsequent to the date of their evaluation, there were no
significant changes in the Company internal controls or in other factors that
could significantly affect the disclosure controls, including any corrective
actions with regard to significant deficiencies and material weaknesses.
13
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
GGH, which is the license holder for the Hankavan and Marjan properties, has
continued to be the subject of corrupt and improper demands and threats from the
Minister of the Ministry of Environment and Natural Resources, Vartan Ayvazyan.
The Company has reported this situation to the appropriate authorities in
Armenia and in the United States. Although the Minister has taken the position
that the licenses at Hankavan and Marjan have been terminated, other Armenian
governmental officials have assured the Company to the contrary and Armenian
public records confirm the continuing validity of the licenses. The Company has
received independent legal opinions that all of its licenses are valid and
remain in full force and effect, continues to work at those properties, and has
engaged international and local counsel to pursue prosecution of the illegal and
corrupt practices directed against the subsidiary, including international
arbitration. On November 7, 2006, the Company initiated the thirty-day good
faith negotiating period (which is a prerequisite to filing for international
arbitration under the 2003 SHA, LLC Share Purchase Agreement) with the three
named shareholders and one previously undisclosed principal. The Company filed
for arbitration under the rules under the International Chamber of Commerce,
headquartered in Paris, France, ("ICC") on December 29, 2006. The forum for this
arbitration is New York City. Damages will be determined during the arbitration
proceedings. In addition and based on the US Armenia Bilateral Investment
Treaty, Global Gold Mining filed a request for arbitration against the Republic
of Armenia for the actions of the Minister of Environment and Natural Resources
with the International Centre for Settlement of Investment Disputes, which is a
component agency of the World Bank in Washington, D.C., ("ICSID") on January 29,
2007. Damages will be determined during the arbitration proceedings. The
Ministry of Environment has also sent a notice to terminate Global Gold Mining's
license at Getik. Global Gold Mining continues to work at this property and will
oppose any attempt to terminate this license.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On January 1, 2007, the Company entered an employment agreement with Hrayr
Agnerian, designating him as the Company's Senior Vice President for Exploration
and Development. Mr. Agnerian formerly worked at Scott Wilson Roscoe Postle
Associates Inc. (Scott Wilson RPA), and is no longer an employee of Scott Wilson
RPA. The employment agreement provides that Mr. Agnerian will receive an annual
base salary of $62,500, and is entitled to receive any bonus as determined in
accordance with any plan approved by the Board of Directors. Mr. Agnerian
resigned from the Board of Directors effective December 31, 2006. The employment
agreement is for an initial term of two years, terminating on December 31, 2008.
Pursuant to employment agreement, Mr. Agnerian was also granted (i) Eighty Three
Thousand Three Hundred Thirty Four (83,334) shares of the common stock of Global
Gold Corporation pursuant to the terms of the Restricted Stock Award to vest in
four equal installments of 20,834 shares every six months, commencing on June 1,
2007 and (ii) options to acquire Eighty Three Thousand Three Hundred Thirty Four
(83,334) shares of common stock of Company at the rate of 41,667 per year from
January 1, 2007 through January 1, 2008 (totaling 83,334) at $0.88 per share
(the arithmetic mean of the high and low prices of the Company's stock on
December 29, 2006), to vest in two equal installments of 41,667 shares each on
January 1, 2007 and January 1, 2008. The restricted stock and options are
subject to a substantial risk of forfeiture upon termination of his employment
with the Company during the term of the Agreement and the option grant was made
pursuant to the Global Gold Corporation 2006 Stock Incentive Plan. The Company
issued such securities in reliance upon Section 4(2) of the Act.
14
On January 11, 2007, the Company declared a stock bonus to Dr. Urquhart of
10,000 shares of common stock at $0.86 per share for a total value of $8,600.
The Company also declared stock bonuses to 64 employees in Armenia for a total
of 20,750 shares of common stock at $0.86 per share for a total value of
$17,845. The $26,445 was included in officers' compensation and in accounts
payable and accrued expenses as of December 31, 2006. The Company also declared
stock bonuses to 8 key employees in Armenia for a total of 32,500 shares of
common stock at $0.86 per share for a total value of $27,950 which vest over 2
years. As of December 31, 2006, the $27,950 was included in unearned
compensation and in accounts payable and accrued expenses. The Company issued
such securities in reliance upon Section 4(2) of the Act.
On January 11, 2007, the Company issued as directors fees to each of the five
directors (Nicholas J. Aynilian, Drury J. Gallagher, Harry Gilmore, Ian Hague,
and Van Z. Krikorian) stock options to purchase 100,000 Common Stock of the
Company each at $.86 per share. The option grants were made pursuant to the
Global Gold Corporation 2006 Stock Incentive Plan. In addition, the Company
granted 50,000 shares of restricted Common Stock to Harry Gilmore as an initial
director's fee at the fair market value of $.86 per share. The Company issued
such securities in reliance upon Section 4(2) of the Act.
Item 3. Defaults Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders.
None
Item 5. Other Information.
None
15
Item 6. Exhibits.
The following documents are filed as part of this report:
Unaudited Consolidated Financial Statements of the Company, including Balance
Sheet as of March 31, 2007; Statements of Operations and Comprehensive Loss for
the three-months ended March 31, 2007 and March 31, 2006, and for the
development stage period from January 1, 1995 through March 31, 2007, and
Statements of Cash Flows for the three months ended March 31, 2007 and March 31,
2006, and for the development stage period from January 1, 1995 through March
31, 2007 and the Exhibits which are listed on the Exhibit Index
EXHIBIT NO. DESCRIPTION OF EXHIBIT
--------------------------------------------------------------------------------
Exhibit 10.1 Employment Agreement, dated as of January 1, 2007, by and
between Global Gold Corporation and Hrayr Agnerian. (1)
Exhibit 10.2 Labrador Uranium Claims Agreement, dated January 18, 2007. (2)
Exhibit 10.3 Cochrane Pond Option Agreement, dated April 12, 2007. (3)
Exhibit 31.1 Certification of Chief Executive Officer pursuant to Rule
13a-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
Exhibit 31.2 Certification of Chief Executive Officer pursuant to Rule
13a-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
Exhibit 32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
Exhibit 32.2 Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002
(1) Incorporated herein by reference to Exhibit 10.7 to the Company's
annual report on 10-KSB for the year ended December 31, 2006, filed
with the SEC on April 2, 2007.
(2) Incorporated herein by reference to Exhibit 10.3 to the Company's
current report on Form 8-K filed with the SEC on January 24, 2007.
(3) Incorporated herein by reference to Exhibit 10.3 to the Company's
current report on Form 8-K filed with the SEC on April 16, 2007.
16
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
GLOBAL GOLD CORPORATION
Date: May 15, 2007 /s/ Van Z. Krikorian
--------------------------
Van Z. Krikorian
Chairman and Chief Executive Officer
EX-31
2
ex311.txt
CEO CERT.
Exhibit 31.1
CERTIFICATIONS
I, Van Z. Krikorian, certify that:
1) I have reviewed this Quarterly Report on Form 10-QSB of Global Gold
Corporation for the period ended March 31, 2007;
2) Based on my knowledge, this Quarterly Report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this Quarterly
Report;
3) Based on my knowledge, the financial statements, and other financial
information included in this Quarterly Report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this Quarterly Report;
4) The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this Quarterly Report is being prepared;
b) [Reserved]
c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this Quarterly Report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this Quarterly Report based on such evaluation; and
d) Disclosed in this Quarterly Report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
5) The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
Date: May 15, 2007 /s/ Van Z. Krikorian
--------------------------
Van Z. Krikorian
Chairman and Chief Executive Officer
EX-31
3
ex312.txt
CFO CERT.
Exhibit 31.2
CERTIFICATIONS
I, Lester S. Caesar, certify that:
1) I have reviewed this Quarterly Report on Form 10-QSB of Global Gold
Corporation for the quarter ended March 31, 2007;
2) Based on my knowledge, this Quarterly Report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this Quarterly
Report;
3) Based on my knowledge, the financial statements, and other financial
information included in this Quarterly Report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this Quarterly Report;
4) The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this Quarterly Report is being prepared;
b) [Reserved]
c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this Quarterly Report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this Quarterly Report based on such evaluation; and
d) Disclosed in this Quarterly Report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
5) The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
Date: May 15, 2007 /s/ Lester S. Caesar
--------------------------
Lester S. Caesar
Chief Financial Officer
EX-32
4
ex321.txt
CEO CERT.
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Global Gold Corporation (the
"Company") on Form 10-QSB for the period ending March 31, 2007 as filed with the
Securities and Exchange Commission (the "Report"), I, Van Z. Krikorian, the
Chairman and Chief Executive Officer of the Company, certify pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 as amended; and
(2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
Date: May 15, 2007 /s/ Van Z. Krikorian
--------------------------
Van Z. Krikorian
Chairman and Chief Executive Officer
EX-32
5
ex322.txt
CFO CERT.
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Global Gold Corporation (the
"Company") on Form 10-QSB for the period ending March 31, 2007 as filed with the
Securities and Exchange Commission (the "Report"), I, Lester S. Caesar, the
Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that:
(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 as amended; and
(2)The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
Dated: May 15, 2007 /s/ Lester S. Caesar
---------------------------
Lester S. Caesar
Chief Financial Officer
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