UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
| Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For
the quarterly period ended
| Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the transition period from _________ to _________
COMMISSION
FILE NUMBER
(Exact name of registrant as specified in its charter)
| (State
or other jurisdiction Of incorporation or organization) |
(IRS
employer identification number) |
(Address of principal executive offices, including zip code)
(Registrant’s telephone number, including area code)
Securities Registered pursuant to Section 12(b) of the Act: None
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| OTCQB |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant
to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and
post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and “emerging growth company” in Rule- 12b-2 of the Exchange Act.:
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| ☒ | Smaller reporting company | |||
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
| Class | Outstanding at August 14, 2024 | |
| Common stock, $ par value |
TABLE OF CONTENTS
| i |
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
GLOBAL AI, INC.
Condensed Balance Sheets
(Unaudited)
| June 30, 2024 | December 31, 2023 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Total current assets | ||||||||
| Total Assets | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
| Current Liabilities | ||||||||
| Accounts Payable | $ | $ | ||||||
| Payroll Taxes Payable | ||||||||
| Total current liabilities | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies (Note 4) | ||||||||
| Stockholders’ Deficit | ||||||||
| Preferred stock, $ par value; authorized; issued or outstanding | ||||||||
| Common stock, $ par value; shares authorized; issued and outstanding at June 30, 2024 and December 31, 2023 | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ deficit | ( | ) | ( | ) | ||||
| Total Liabilities and Stockholders’ Deficit | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
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GLOBAL AI, INC.
Condensed Statements of Operations
(Unaudited)
| For the three months ended | For the six months ended | |||||||||||||||
| June 30, 2024 | June 30, 2023 | June 30, 2024 | June 30, 2023 | |||||||||||||
| Revenues: | ||||||||||||||||
| Contracted services-related party | $ | $ | $ | $ | ||||||||||||
| Total Revenues | ||||||||||||||||
| Operating Expenses: | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Professional fees | ||||||||||||||||
| Total Operating Expenses | ||||||||||||||||
| Income (Loss) From Operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other Expense | ||||||||||||||||
| Interest expense – related party | ( | ) | ) | ( | ) | |||||||||||
| Total Other Expense | ( | ) | ) | ( | ) | |||||||||||
| Net income (loss) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net income(loss) per share - basic and diluted | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
| Weighted average number of common shares - Basic and Diluted | ||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
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GLOBAL AI, INC.
Condensed Statement of Changes in Stockholders’ Deficit
For the three and six months ended June 30, 2023
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares Issued | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance at December 31, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net (loss) | - | ( | ) | ( | ) | |||||||||||||||
| Balance at March 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Net (loss) | - | ( | ) | ( | ) | |||||||||||||||
| Balance at June 30, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
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GLOBAL AI., INC.
Condensed Statement of Changes in Stockholders’ Deficit
For the three and six months ended June 30, 2024
| Common Stock | Additional Paid-in | Accumulated | Total Stockholders’ | |||||||||||||||||
| Shares Issued | Amount | Capital | Deficit | Deficit | ||||||||||||||||
| Balance at December 31, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Cash received from subscription Receivable | - | |||||||||||||||||||
| Net (loss) | - | ( | ) | ( | ) | |||||||||||||||
| Balance at March 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
| Cash received from subscription Receivable | - | |||||||||||||||||||
| Net (loss) | - | ( | ) | ( | ) | |||||||||||||||
| Balance at June 30, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | ||||||||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
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GLOBAL AI, INC.
Condensed Statements of Cash Flows
(Unaudited)
| For the Six | For the Six | |||||||
| Months Ended | Months Ended | |||||||
| June 30, 2024 | June 30, 2023 | |||||||
| Cash flows from Operating Activities: | ||||||||
| Net (loss) | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net income(loss) to net cash provided by (used in) operating activities: | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Increase in accounts receivable related party | ( | ) | ||||||
| Increase in prepaid expenses | ( | ) | ||||||
| (Decrease) in accounts payable | ( | ) | ( | ) | ||||
| Increase in payroll taxes payable | ||||||||
| Increase in accrued interest payable - related party | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows provided by investing activities | ||||||||
| Funds received from subscription receivable | ||||||||
| Net cash provided by investing activities | ||||||||
| Increase (decrease) in cash during the period | ( | ) | ( | ) | ||||
| Cash, beginning of the period | ||||||||
| Cash, end of the period | $ | $ | ||||||
| SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||||||||
| Interest paid in cash | $ | $ | ||||||
| Taxes paid in cash | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed financial statements.
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Global AI, Inc.
Notes to Condensed Unaudited Financial Statements
June 30, 2024
Note 1 - Nature of Operations and Summary of Significant Accounting Policies
Nature of Operations
Global AI was organized as Mycatalogsonline.com, Inc. in the state of Nevada on January 6, 2009. In April 2009, the Company changed its name to My Catalogs Online, Inc. In November 2012, the Company changed its name to Bright Mountain Holdings, Inc. In August 2013, the Company changed its name to Wall Street Media Co, Inc. and in October 2023 the Company changed its name to Global AI, Inc.
The Company expects to acquire, integrate and develop artificial intelligence (“AI”)-based technology companies and assets (the “Acquisitions”). The Company intends to focus its Acquisitions on machine and deep learning, generative AI, computer vision, natural language processing, and other AI technologies. The Company focuses on Acquisitions that are scalable and have revenue models that provide for tangible growth. Once acquired, the Company plans to integrate and further develop the companies and assets acquired in the Acquisitions to increase their existing customer base and further develop their existing products and services. The Company also plans to “cross-pollinate” knowledge and strategies derived from each of its Acquisitions with other Acquisitions for the benefit of the Company’s network as a whole. In addition, the Company plans to centralize back office administrative functions and take advantage of cost and revenue synergies across the Acquisitions’ platforms.
On
September 12, 2023, Ingenious Investment AG purchased, from their own funds, from existing shareholders of the Company, in a series of
private transactions, a total of shares of common stock, $ per share of Global AI, Inc., representing
Basis of Presentation
The interim unaudited condensed financial statements included herein have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). In the opinion of the Company’s management, all adjustments (consisting of normal recurring adjustments and reclassifications and non-recurring adjustments) necessary to present fairly the results of operations and cash flows for the three and six months ended June 30, 2024, and the financial position as of June 30, 2024, have been made. The results of operations for such interim periods are not necessarily indicative of the operating results to be expected for the full year. Certain information and disclosures normally included in the notes to the annual financial statements have been condensed or omitted from these interim condensed financial statements. Accordingly, these unaudited interim condensed financial statements should be read in conjunction with the Audited Financial Statements and Notes thereto as of and for the year ended December 31, 2023 included in our Report on Form 10-K as filed with the SEC on March 29, 2024. The December 31, 2023 balance sheet is derived from those financial statements.
Use of Estimates
The financial statements are prepared in accordance with Accounting Principles Generally Accepted in the United States (“GAAP”). These accounting principles require the Company to make certain estimates, judgments and assumptions. The Company believes that the estimates, judgments and assumptions upon which it relies are reasonable based upon information available at the time that these estimates, judgments and assumptions are made. These estimates, judgments and assumptions can affect the reported amounts of assets and liabilities as of the date of the financial statements as well as the reported amounts of revenues and expenses during the periods presented. The financial statements would be affected to the extent there are material differences between these estimates and actual results. In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require management’s judgment in its application. There are also areas in which management’s judgment in selecting any available alternative would not produce a materially different result. Significant estimates include the valuation allowance on deferred tax assets.
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Cash and Cash Equivalents
The
Company considers financial instruments with original maturities of three months or less to be cash equivalents. The Company had
Revenue Recognition
The Company recognizes revenue using the five-step revenue recognition model as prescribed by ASC 606, “Revenue from Contracts with Customers”. The underlying principle of ASC 606 is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services.
Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of common shares outstanding for the period and, if dilutive, potential common shares outstanding during the period. Potentially dilutive securities consist of the incremental common shares issuable upon exercise of common stock equivalents such as stock options and convertible debt instruments. Potentially dilutive securities are excluded from the computation if their effect is anti-dilutive. There were potentially dilutive securities outstanding at June 30, 2024 or December 31, 2023.
Note 2 - Going Concern
As
reflected in the accompanying condensed financial statements, the Company generated a net loss of $
Note 3 – Related Party Transactions
The Company had no related party transactions for the six month period ended June 30, 2024.
Note 4 – Stockholders’ Deficit
The Company has common stock authorized and has shares issued and outstanding at June 30, 2024.
In
November 2023, the Company entered into subscription agreements with investors to issue shares of common stock at $ per
share. The Company issued the shares but only received $
On
January 29, 2024, the Company executed a
Note 5 – Commitments and Contingencies
From
time to time, the company may be involved in asserted claims arising out of our operations in the normal course of business. As of June
30, 2024, there were
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
FORWARD-LOOKING STATEMENTS
There are statements in this annual report on Form 10-Q that are not historical facts. These “forward-looking statements” can be identified by use of terminology such as “believe”, “hope”, “may”, “anticipate”, “should”, “intend”, “plan”, “will”, “expect”, “estimate”, “project”, “positioned”, “strategy”, and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that are beyond our control. For a discussion of these risks, you should read this entire annual report on Form 10-Q document carefully. Although management believes that the assumptions underlying the forward-looking statements are reasonable, they do not guarantee our future performance, and actual results could differ from those contemplated by these forward-looking statements. The assumptions used for the purposes for the forward-looking statements specified in the following information represent estimates of future events and are subject to uncertainty as to possible changes in the economy, legislative changes, changes in the industry, technological developments and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the achievability of those forward-looking statements. In the light of these risks and uncertainties, there can be no assurance that the results and events contemplated by the forward-looking statements contained in this annual report on Form 10-K will in fact transpire. You are cautioned not to place reliance on these forward-looking statements, which speak only as of their dates. We do not undertake any obligation to update or revise any forward-looking statements.
OVERVIEW
Global AI was organized as Mycatalogsonline.com, Inc. in the state of Nevada on January 6, 2009. In April 2009, the Company changed its name to My Catalogs Online, Inc. In November 2012, the Company changed its name to Bright Mountain Holdings, Inc. In August 2013, the Company changed its name to Wall Street Media Co, Inc. and in October 2023 the Company changed its name to Global AI, Inc.
The Company expects to acquire, integrate and develop artificial intelligence (“AI”)-based technology companies and assets (the “Acquisitions”). The Company intends to focus its Acquisitions on machine and deep learning, generative AI, computer vision, natural language processing, and other AI technologies. The Company focuses on Acquisitions that are scalable and have revenue models that provide for tangible growth. Once acquired, the Company plans to integrate and further develop the companies and assets acquired in the Acquisitions to increase their existing customer base and further develop their existing products and services. The Company also plans to “cross-pollinate” knowledge and strategies derived from each of its Acquisitions with other Acquisitions for the benefit of the Company’s network as a whole. In addition, the Company plans to centralize back office administrative functions and take advantage of cost and revenue synergies across the Acquisitions’ platforms.
On September 12, 2023, Ingenious Investment AG purchased, from their own funds, from existing shareholders of the Company, in a series of private transactions, a total of 24,944,466 shares of common stock, $0.001 per share of Global AI, Inc., representing 92.7% of the outstanding shares of the Company’s common stock at such time.
The Company has one full-time employee and also engages consultants and advisors from time to time.
Recent Events
On May 7, 2024, Abhinav Somani resigned as President and Chief Executive Officer of the Company. Nevenka Cresnar Pergar, the current Chairperson of the board of directors of the Company (the “Board”) is acting as President and Chief Executive Officer until a replacement is found.
On May 7, 2024, Sebastian Holl notified the Board of his resignation as a member of the Board. Neither Mr Somani nor Mr. Holl’s resignation was the result of any dispute or disagreement with the Company or the Board on any matter relating to the operations, policies or practices of the Company.
CRITICAL ACCOUNTING POLICIES
In response to the Securities and Exchange Commission’s (the “SEC”) financial reporting release, FR-60, Cautionary Advice Regarding Disclosure About Critical Accounting Policies, the Company has selected its more subjective accounting estimation processes for purposes of explaining the methodology used in calculating the estimate, in addition to the inherent uncertainties pertaining to the estimate and the possible effects on the Company’s financial condition. These accounting estimates are discussed below. These estimates involve certain assumptions that if incorrect could create a material adverse impact on the Company’s results of operations and financial condition
Revenue Recognition
The Company recognized revenue using the five-step revenue recognition model as prescribed by ASC 606, “Revenue from Contracts with Customers”. The underlying principle of new standard is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services. The Company adopted the standard using the modified retrospective method and the adoption did not have a material impact on its financial statements.
RESULTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 2024 COMPARED TO THE THREE MONTHS ENDED JUNE 30, 2023
Revenue: The Company’s revenues decreased by approximately 100% to $0 during the three months ended June 30, 2024 as compared to $14,500 for the three months ended June 30, 2023 due to a decrease in consulting services provided.
Operating Expenses: The Company’s operating expenses increased by approximately 1438% to $256,431 during the three months ended June 30, 2024 as compared to $16,674 for the three months ended June 30, 2023 primarily due to an increase in professional fees.
Loss from operations: The Company’s loss from operations increased approximately 11695% to $256,431 during the three months ended June 30, 2024 from a loss from operations of $2,174 for the three months ended June 30, 2023. The primary reason for this was due to an increase in professional fees.
FOR THE SIX MONTHS ENDED JUNE 30, 2024 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2023
Revenue: The Company had no revenue for the six months ended June 30, 2024 and $31,500 for the six months ended June 30,2023.
Operating Expenses: The Company’s operating expenses increased by approximately 1655% to $610,059 during the six months ended June 30, 2024 as compared to $34,745 for the six months ended June 30, 2023 primarily due to an increase in professional fees.
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Net loss from operations: The Company’s net loss from operations increased approximately 322% to $610,059 during the six months ended June 30, 2024 from a net loss from operations of $3,245 for the six months ended June 30, 2023. The primary reason for this was due to an increase in professional fees expense.
LIQUIDITY AND CAPITAL RESOURCES
Net cash used in operating activities was $734,883 for the six months ended June 30, 2024 as compared to $8,150 for the six months ended June 30, 2023. The increase was primarily due to the increases in professional fees expense.
As of June 30, 2024, the Company had $22,417 in cash. The Company has sustained losses from operations, and such losses are expected to continue. The Company’s auditors have included a “Going Concern Qualification” in their report for the year ended December 31, 2023. In addition, the Company has a working capital deficit at June 30, 2024 of $88,853 with minimal revenues. The foregoing raises substantial doubt about the Company’s ability to continue as a going concern. The Company is actively seeking to combine or merge with another operating company. There can be no assurance that the level of funding needed will be acquired or that the Company will generate sufficient revenues to sustain operations for the next twelve months. The unaudited condensed financial statements do not include any adjustments that might result from the outcome of this uncertainty.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources, that is material to investors.
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Item 3. Quantitative and Qualitative Disclosure About Market Risk.
Not applicable to smaller reporting companies.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We carried out an evaluation required by Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), under the supervision and with the participation of our management, including our Chief Executive Officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a–15(e). Disclosure controls and procedures are designed with the objective of ensuring that (i) information required to be disclosed in an issuer’s reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms and (ii) information is accumulated and communicated to management, including our Chief Executive Officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.
The evaluation of our disclosure controls and procedures included a review of our objectives and processes and effect on the information generated for use in this report. This type of evaluation is done quarterly so that the conclusions concerning the effectiveness of these controls can be reported in our periodic reports filed with the SEC. We intend to maintain these controls as processes that may be appropriately modified as circumstances warrant.
Based on their evaluation, our Chief Executive Officer and principal financial officer has concluded that our disclosure controls and procedures are not effective in timely alerting our Chief Executive Officer and principal financial officer to material information which is required to be included in our periodic reports filed with the SEC as of the end of the period covering this annual report on Form 10-K.
PART II- OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 1A. Risk Factors.
Not applicable to smaller reporting companies.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None
Item 3. Defaults upon Senior Securities.
None
Item 4. Mine Safety Disclosures
Not Applicable
Item 5. Other Information.
None.
Item 6. Exhibits
(a) Exhibits
| EXHIBIT NO. | DESCRIPTION | |
| 31.1 | Section 302 Certification of Principal Executive Officer and Principal Financial Officer | |
| 32.1 | Section 906 Certification | |
| 101. INS* | Inline XBRL Instance Document | |
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |
| 101.LAB* | Inline XBRL Taxonomy Extension Labels Linkbase Document | |
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
| 104* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
| 10 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Global AI, Inc. | ||
| Date: August 14, 2024 | By: | /s/ Nevenka Cresnar Pergar |
| Nevenka Cresnar Pergar | ||
Acting President and Chief Executive Officer (principal executive officer and principal financial officer) | ||
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