Global Arena Holding, Inc. - Annual Report: 2021 (Form 10-K)

Global Arena Holding, Inc.

Form 10-K

For the Fiscal Year Ended December 31, 2021

Table of Contents

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PART I

ITEM 1.   BUSINESS

Global Arena Holding Inc. (“the Company”), a Delaware corporation, is organized as a holding company. The Company became a public company on May 18, 2011, when it successfully completed a reverse merger with China Stationery and Office Supply, Inc., an OTC Bulletin Board company.

The Company currently has three subsidiary companies.

The Company, GAHI Acquisition, Tidewater Energy Group and GES do not trade crypto currency, nor do they participate in Initial Coin Offerings.

1) Global Election Services (GES)

GES, formed on February 25, 2015, provides comprehensive technology-enabled paper Absentee/Mail Ballot and Online election services to organizations such as craft and trade organizations, labor unions, political parties, co-operatives and housing organizations, associations and professional societies, universities, and political organizations. GES has developed proprietary election software for a data storage and retrieval registration system to determine voter eligibility and prevent duplicate votes with In-Person digital signature capture, as well as proprietary election software for scanning/tabulation utilizing advanced OMR/OCR/Barcode imaging software featuring de-skewing, de-speckling and image correction. The hardware includes high speed optical scanners that are hard lined to a computer with all Wi-Fi disabled so the entire tabulation process occurs offline, eliminating the opportunity for hacking. This system provides three types of audit capabilities.

GES is also working with multiple vendors and has made investments in companies that are developing Blockchain Technology for a data storage and retrieval registration system; tabulation of paper Absentee/Mail Ballots; and Internet voting.

The Company has also signed a Letter of Intent to acquire the assets of Election Services Solutions including all clients, contracts and employment contracts. This asset purchase is currently pending.

GES Acquisition of Election Services Solutions, LLC

On March 25, 2021, the Company entered into a second amended purchase agreement (APA) with Election Services Solutions. Under the second APA the Company entered into an amended asset purchase agreement with Election Services Solutions, LLC.  Under the amended APA, the Company will purchase 100% of the assets of Election Services Solutions, LLC and the Company will pay $650,000, of which $511,150 has already been paid, and issue 40,000,000 common shares to purchase these assets under this second amended APA. This APA replaces the first amended purchase agreement signed on May 10, 2019 wherein the Company was to purchase 100% of the assets of Election Services Solutions, LLC.  The Company was to pay $550,000, of which $511,150 has already been paid, and issue 20,000,000 common shares to purchase these assets under this first amended APA. GES derives over 80 % of its current business from Election Services Solutions. Management anticipates the closing of this transaction will occur in the fourth quarter of 2022.

The ESS asset acquisition will give GES the ability to expand into the following areas:

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GES Current Business

As one of the United States premier providers of comprehensive election services, GES focuses on efficiency, accuracy, integrity and security. GES prides itself on being able to provide flawless results regardless of the size or complexity of the project. GES helps organizations manage elections, strengthen corporate governance, increase member participation, and reduce costs.

Today’s election officials take on tremendous responsibility in managing all aspects of the voting process from selecting products to ensuring fair elections and every phase in between. In an industry that is constantly evolving, these tasks become more challenging every day. GES provides full-service technology enabled election solutions to clients while offering the experience, support, security, and capacity needed to meet ever-changing client needs now and in the future. GES believes it is unique in its ability to integrate multiple methods of voting; customers can hold elections via Paper Ballots by mail or in person, Internet Voting, or any combination of these methods, which GES refers to as Hybrid elections. Every project begins with a full review of the bylaws to ensure total compliance. GES then prepares a formal project plan and timeline. An experienced Election Administrator manages every facet of the project, while keeping the client fully informed every step of the way. GES provides telephone and/or email support for any procedural questions and help for management as well as voters. GES projects enhance the image of professionalism of the client organization, providing our clients with peace of mind every step of the way.

The GES’ senior management team has conducted approximately over 8,650 elections, involving more than 40,000,000 voters. Each organized labor election result requires an election certification submitted to the US Department of Labor, and for over 40 years, not one of our elections has been overturned.

Election security is an absolute priority for GES. We have seen emotions run high in many projects. Our focus on the security and confidentiality of election information diffuses most concerns and creates a broad consensus that the project is being conducted correctly and impartially. Election Committees regularly observe our processing and tabulation activities.

Paper Ballots; Absentee/Mail and In-Person Voting

GES management has been handling paper mail ballot and in-person elections for Labor Unions, Associations, and other private organizations for over 40 years. This process starts with a nominations meeting, creation and printing of the ballot and all materials. For an Absentee/Mail election, ballot packages are mailed to all eligible voting members. On the voting/tabulation day, GES collects the mail and uses the proprietary registration system that we developed to authenticate and register voters by scanning a barcode on the Business Reply Mail envelope with the ballot inside. For an in-person election, voters are authenticated in our system, and they sign a digital signature pad for registration. The authentication is based on a database provided by the client and any ineligible or challenged votes are removed. Once this list of valid voters has been compiled, we open the envelopes with identifiers and pull out the secret ballot envelope/sleeve containing the ballot. Once the ballots are pulled from the secret ballot envelopes/sleeves, we scan them using our proprietary software and hardware system to tabulate the votes. We uphold the essential requirements that the vote is secret, and each voter only gets one vote.

Organized Labor/Unions

Organized Labor Unions and their memberships in the United States are represented at the Local level, the regional level, and the international level. The smallest membership totals are at the Local level, groups of locals in a geographical area combine to make up a regional level, and all members belong to an International Level. Elections occur in all these groups and subsets of them, which means that there could be multiple votes for the same union throughout the year, with GES charging a per-member fee for each one. Most Nominations and Officer Elections for union leaders occur every two to three years. Additionally, GES is regularly involved in other types of elections, including : Strike Votes, Contract Ratifications, Delegate Nominations, Dues Increases, Assessments, By-Law Changes and Unexpired Term Votes, all of which can be done online. Each union has by-laws that dictate the process and how often these elections occur. Due to our experience, it is a natural progression for GES to expand into administering Regional and International elections, which GES has already begun to do.

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In the fourth quarter of 2016, the U.S. Department of Labor (DOL) released official guidelines for voting online. Since then, we have worked to develop our systems to offer our customers the most advanced software available today. The DOL announcement has encouraged many unions to look into this option for non-officer elections because it is not only a more efficient process, but there is also a significant cost savings for the client.

Residential Organizations, Co-op/Condos

GES has been conducting elections for Homeowner and Co-Op Organizations for more than forty years. At GES, we understand the sensitivity of the project, and the need to present a flawless experience to the owners. GES is the independent and impartial third-party Organizations can trust to manage an election and provide an organization with the tools essential to strong leadership and good governance. GES provides complete management of an election project, from initial design of voting materials through tabulation. We support in-person, paper mail, and Internet voting using ballots or proxies. Signature verification, slates, and weighted, or share, voting are standard. No activity proceeds unless there is a quorum present. Interim results are available immediately and certified results normally follow within 24 hours. The GES Team has conducted elections at properties with fewer than 200 Membership Interests, and with more than 10,000. We have also conducted lotteries for public housing agencies including Section 8 Housing.

Now more than ever it is important to know what property owners are thinking. For many clients, we've included a limited set of survey questions on the proxy for the Board election. This technique has proven effective in capturing voter interest and stimulating turnout, in addition to providing valuable feedback on the important issues. GES can develop a regular program of surveys to help the client more effectively gauge members' views on needed improvements, regulatory matters, or other association-related issues. This interaction is made even easier utilizing GES’ online voting platform.

GES Developed Election Technology

Voter Authentication and Registration Software

GES has worked diligently to create a very specific proprietary registration election software that functions in authenticating and registering voting members in a data look-up system. In the event of an In-Person election, a voter ID can be scanned, or information typed in to pull that voter up. A digital signature is then captured and saved to complete the voter’s registration and is available in a final list of ‘Who Voted”. In the event of a Mail

Ballot, a barcode on the Business Reply Envelope is scanned and the status of that member is identified. If the member is not eligible to vote, that ballot is removed from the count. Additionally, if a member requests a replacement ballot and mails back that and the original, the system will flag the duplicate ballot, which is removed from the valid ballots ensuring only one ballot from each voter is counted. Because we must account for every single ballot, the system has multiple reporting options where we may deliver to the client the list of members who mailed in a ballot but were not able to vote, detailing the reason.

Scanning and Tabulation Software

The GES proprietary scanning election software is advanced OMR/OCR/Barcode scanning and tabulation software featuring de-skewing, de-speckling, and image correction. The computer hardware utilizes high-speed optical scanners and was designed to run hard wired without Internet or Wi-Fi access, ensuring complete security. The system allows for triple auditing capabilities, which are; electronically generated tabulation results, jpeg imaging and storage, and the original physical ballot. This advancement gives GES the ability to tabulate elections faster and more efficiently and brings the opportunity for GES to compete for larger elections. GES began successfully deploying this system in our elections during the third quarter of 2017.

Online Voting

GES has a current client base of hundreds of unions. GES is committed to providing a comprehensive, secure voting platform, using state of the art technology for election officials charged with running their elections. We also offer the option for a “hybrid” election, which allows members to choose a Mail Ballot, In Person and/or Online Voting options, while ensuring no one votes twice. GES strives to build a user experience that limits human error and makes the voting process as easy and seamless as possible while ensuring the highest level of secrecy, security, and One Voter = One Vote integrity that we have been committed to for nearly 4 decades.

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In 2020, GES developed, built, and implemented a propriety online election voting solution that is compliant with Title IV of the United States Department of Labor Office of Labor-Management Standards. GES built the platform on one of the most secure global infrastructures Amazon Web Services (AWS) which is a comprehensive, evolving platform provided by Amazon that includes a mixture of infrastructure as a service (IaaS) platform as a service and packaged software (PaaS), and software as a service offering (SaaS). The platform enables GES to protect individual client data, including the ability to encrypt it, move it, and manage retention (if required). All data flowing across the global network interconnects with the GES secured data center and is automatically encrypted at the physical layer before it leaves our secured facilities. Additional encryption layers exist as well. GES controls where our client data is stored, who can access it, and what resources your organization is utilizing at any given moment. Fine-grain identity and access controls combined with continuous monitoring for near real-time security information ensures that the right resources have the right access at all times, wherever your information is stored. GES encryption software uses AES 256 with a cryptographic key using an RSA elliptic curve of 4096, which is used to encrypt the communication of the client and the GES server, as well all client data hosted in the server. A six-digit security code, delivered to the voter’s email address provided by the client, must be validated by the prospective voter in order to authenticate the identity of the voter before the voter may access the ballot. After validating the voter, the voter then votes anomalously, so that the identity of the voter and the ballot cast can never be matched. The GES voting platform verifies that the users does not use the back and forward browser button, a safe mechanism against tampering. Distributed denial of service DDoS protection tools help secure websites and applications and prevent DDoS attacks, which bombard websites with traffic traditionally delivered via “botnets" that are created by networked endpoints connected via malware. The DDoS software protection provides always-on detection and automatic inline mitigations that minimize application downtime and latenc. The GES platform also provides voting features such as posting documents like candidate statements, pictures, contracts, or amendments to be voted on.

Current GES Technology Providers

GES is currently working with the following software individuals, companies with our efforts being dedicated to:

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Ensuring the highest level of security protocols that comply with all necessary standards

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Developing a Registration System supported by Blockchain Technology for security

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Building an interface that is instinctive and user-friendly

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Customizing for specific sectors’ rules and requirements

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Allowing for scalability while maintaining integrity

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Growing our client list by offering high quality technology solutions

By working with Magdiel Rodriguez, Imaging 101, True Vote Inc, Voatz Inc, and Blockchain Valley Ventures, GES is working to design and create information technology and information systems management including software development services, infrastructure, network, support, corporate security, and risk management.

Imaging 101 is a technology company, TrueVote Inc, Voatz Inc are Blockchain technology companies and Blockchain Valley Ventures is Blockchain Advisory company.

Working Relationship with Magdiel Rodriguez

On January 14, 2022, GES entered into an Independent Consulting Agreement (ICA) with Magdiel Rodriquez. Under the terms of the ICA Magdiel Rodriquez will receive 15,000,000 million common shares in return for his software expertise in the development of GES election software. This new ICA replaces an amended MSA signed

May 13, 2019 with HCAS and Magdiel Rodriquez wherein the Company was to issue a total of 30,000,000 warrants to purchase the Company’s common shares at a price of $0.005 as consideration for the services of HCAS and Mr. Magdiel Rodriquez. Mr. Rodriguez has over 25 years’ experience in the areas of Information Security, Enterprise Risk Management and Compliance, Information Technology and Operations including 21 years with Visa Inc. where he performed as Senior Business Leader of Information Security. Magdiel has extensive experience in a broad range of areas related to Information Security, Network Engineering, and Enterprise Governance, Risk and Compliance and Payment networks within the financial industry.  Management anticipates the closing of this transaction will occur in the second quarter of 2022.

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Working Relationship with Imaging 101

Imaging 101, a technology company based in Ft. Lauderdale, FL has developed for GES a specific registration software that functions in authenticating and registering voting members in a data look-up system. In the event of an In-Person election, a voter ID can be scanned, or any information typed in to pull that voter up. A digital signature can also be captured and saved for the final list of ‘Who Voted”. In the event of a Mail Ballot, a barcode on a Business Reply Envelope is scanned and the status of that member is identified. If the member is not eligible to vote, that ballot is removed from count. Because we must account for every single ballot, the system has multiple reporting options where we may deliver to the client the list of members who mailed in a ballot but were not able to vote, detailing the reason.

Imaging 101 also developed for GES an advanced OMR/OCR/Barcode scanning and tabulation software system featuring de-skewing, de-speckling, and image correction. The computer hardware was designed to run hard wired without Internet or Wi-Fi access, ensuring complete security. The system allows for triple auditing capabilities, which are; electronically generated tabulation results, jpeg imaging and storage, and the original physical ballot. This advancement gives GES the ability to tabulate elections faster and more efficiently and brings the opportunity for GES to compete for larger elections.

GES Investment in TrueVote Inc.

On June 15, 2019, GES entered into a Term Sheet, and Common Stock Purchase Agreement to create a joint venture with TrueVote, Inc. Under the terms of the agreement GES was to invest $50,000 into a 24 Month Debenture and issue a 3 year warrant exercisable at $0.01 for 4,500,000 common shares of the Company. The Company will receive 3 million common shares of TrueVote, representing  30% of TrueVote Inc. The Company on December 17, 2019 paid $ 40,000 to True Vote. Under the terms of the agreement GES is to invest an additional $10,000 and the Company issue a 3 year warrant exercisable at $0.01 for 4,500,000 common shares of the Company. On June 1^st, 2021,  Due to the new guidelines issued by the Election Assistance Commission and its Voluntary Voting Guidelines 2.0, the Company is currently renegotiating this transaction and expects to complete the renegotiation by the 3^rd quarter 2022.

GES on January 21, 2022 signed a Master Service Agreement with Voatz Inc, provide a secure voting platform requiring specific proprietary software that allows for secure online rank choice voting tabulator system , and retained Voatz Inc to create a readiness evaluation and related technical services to GES in the 2^nd and third quarter of 2022.

2) Tidewater Energy Group Inc.

On November 19, 2019, the Company incorporated a new wholly owned entity in the State of Delaware called Tidewater Energy Group Inc. The Board of Directors appointed John S. Matthews and Jason Old as Board members. The Company was formed to explore opportunities in the oil, gas, mineral, and energy business.  Tidewater Energy Group Inc. has 40,000,000 common shares authorized; par value $0.001. There are currently 10,000,000 common shares issued and outstanding of which the Company holds 5,100,000 common shares (51%). The Company invested $50,000 into Tidewater Energy Group Inc. for general capital and administrative expenses in January 2020.

3) GAHI Acquisition Corp.

On June 7, 2019, the Company’s second subsidiary, GAHI Acquisition Corp. (GAHI) was authorized by the Company’s Board of Directors to infuse an initial deposit of $50,000 into the subsidiary for general capital and administrative expenses. GAHI Acquisition was to be be repurposed in order to explore potential new business ventures in an effort to increase shareholder value. The Company cause GAHI Acquisition to explore opportunities in the energy and minerals business which may have provided investment opportunities, including the possibility of providing blockchain technology software to energy and mineral companies. The Company added Mr. Jason N. Old to the GAHI Acquisition Board as a Director. On November 28, 2019, the Company’s Board of Directors authorized the termination of the transaction previously authorized to infuse an initial deposit of $50,000 into GAHI Acquisition for general capital and administrative expenses and have GAHI Acquisition repurposed in order to explore opportunities in the energy and minerals business, which may provide investment opportunities, including the possibility of providing blockchain technology software to energy and mineral companies. GAHI Acquisition will remain a 100% subsidiary of the Company and will focus on Blockchain related companies for investments and acquisition.

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Growth Strategy for the Company

Management believes there are four significant opportunities to increase market share;

1)

The growth and expansion of GES current business and the expansion into paper absentee/mail for US Government and Foreign elections.

2)

The additional development of interactive communication, between elected individuals and their constituents;

3)

The development of Blockchain voting applications.

4)

The diversification of Tidewater Energy Group Inc.

1) Management believes there is an opportunity in conducting United States and Foreign Government Elections. GES’ senior Management teams’ primary business for over 40 years has been mail/absentee ballot elections. The market for GES conducting paper/mail ballot elections grew exponentially in January of 2017, when first President Barack Obama, and then President Donald Trump designated U.S. Elections “Critical Infrastructure”.

In the U.S. there are 3,007 counties, 64 parishes, 19 organized boroughs, 11 census areas, 41 independent cities, and the District of Columbia, all of whom purchase updated Election Machines and Software. Each municipal county individually purchases election voting machines under the guidance of their own State’s Secretary of State, recommendations from the National Association of Secretaries of State (NASS), and local election regulations

The United States Government, through the Elections Assistance Commission, certifies election software and hardware for use in U.S. Government Elections.

The size and scope of the opportunity in US Government elections can be measured in recent legislation providing funding to US municipalities.

 On March 27, 2020, President Donald J. Trump signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) into law. The Act includes $400 million in new Help America Vote Act (HAVA) emergency funds, made available to states to prevent, prepare for, and respond to the coronavirus for the 2020 federal election cycle. This supplemental appropriation funding, distributed by the U.S. Election Assistance Commission (EAC), will provide states with additional resources to protect the 2020 elections from the effects of the novel coronavirus.

On December 20, 2019, President Trump signed the Consolidated Appropriations Act of 2020 into law. The Act includes $425 million in new HAVA funds made available. On March 23, 2018, President Trump signed the Consolidated Appropriations Act of 2018 into law, which included $380 million in Help America Vote Act (HAVA) grants for states to make election security improvements.

Among the authorized uses of the grant funds is the replacement of voting equipment, specifically equipment that does not produce a paper record or that is determined to be at the end of its useful life. Recent published examples are:

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In 2019, Hawaii (SB 166) allocated $789,598 for the purpose of a vote counting system contract.

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In 2019, Georgia issued a $150 million bond package for the replacement of voting equipment statewide. The state also appropriated $12,840,000 from the General Fund for the purpose of financing projects and facilities for the Office of Secretary of State. 

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In 2019, Wyoming appropriated $7.5 million into an election readiness account (HB 21). The state's $3 million HAVA allocation will also be placed in this account, the majority of which will go toward replacing outdated voting equipment statewide. 

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In 2019, North Dakota enacted SB 2002, which included a one-time appropriation for voting equipment and electronic poll books statewide. The total amount of $11.2 million included $8.2 million in state funds and $3 million in HAVA funds. 

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The opportunity for mail/absentee ballots became a page one story in 2020 due to the Coronavirus Pandemic. Subsequent accusations of voter fraud, compounded by President Trump declaring the 2020 U.S. election voting as rigged and fraudulent, has led to almost 40% of the U.S. Electorate believing the 2020 election was fraudulent.

On October 23, 2019, the Brennan Center has estimated that the national cost for some of the most critical election security measures to be approximately $ 2.2 Billion dollars over the next five years. The opportunity is even greater in the midst of the coronavirus pandemic. Due to social distancing requirements, voters should not be congregating at polling locations for In-Person voting. Mail and Absentee Ballot voting has emerged as a safe alternative to In-Person voting and which is a complicated process that requires a company like GES that has significant experience in conducting Mail Ballot voting to avoid problems.

The Elections Assistance Commission (EAC) updated their Voluntary Voting System Guidelines to 2.0 in February 2021. This certification process can take approximately 6 to 9 months and companies applying for certification can spend up to $2,000,000 or more. With the current compliance directives also in place in many individual States, the Company and GES anticipate annual software maintenance of approximately $ 250,000.

The Company and GES have previously engaged software and hardware developers and GES is currently preparing request for proposals to assist in the development of additional and hardware development to comply with the EAC 2.0 Voluntary Voting System Guidelines. This will require the hiring of additional technical software employees, and additional outside vendors who in initial discussions will require fees of approximately 2 million dollars and stock-based compensation

In an effort further prove GES ability to administer municipal and government elections, GES in the 1st quarter of 2020 administered the private government election space when GES successfully completed the Statewide Presidential Primary for North Dakota Democratic-NPL. GES administered the statewide polling for all North Dakota residents who wished to vote in Democratic Presidential Primary by; managing a call center and processed over 3,000 mail ballot requests, set up equipment and trained Staff on our proprietary Registration Software for In-Person voting at 14 locations across the state, and processed over 14,000 ballots with our proprietary Scanning and Tabulation software system.

GES’ IT staff customized our proprietary Voter Registration software to ensure voters cast only one ballot, whether by mail or in person and set up secure servers that processed voter sign-in and digital signature capture in real time from a database of over 600,000 potential voters. GES trained over 100 volunteers, many with limited or no technology experience on how to use the system. After a short tutorial, those volunteers handled the increased registration volume with ease. After the polls closed and all the votes were cast, GES’ tabulation systems processed the ballots using our proprietary Scanning and Tabulation software system. The 2020 North Dakota Democratic-NPL Presidential Primary caucus had the largest voter turnout in over a decade.

Management believes there is an opportunity in conducting United States and Foreign Government Elections. GES’ senior Management teams’ primary business for 40 years has been mail/absentee ballot elections. The market for GES conducting paper/mail ballot elections grew exponentially in January of 2017, when first President Barack Obama, and then President Donald Trump designated U.S. Elections “Critical Infrastructure”.  The effect of these Executive Orders was to refocus the Department of Homeland Security, and the Elections Assistance Commission to reenergize compliance on U.S. Government elections, and assist by making available resources such as intelligence, funding, training and best practices in election software and hardware, for all 50 States.

GES has begun undertaking the following six step benchmarks to qualify for the updated U.S. certification and is also considering individual State certifications.

Step 1 - Voting System Testing, Testing current developed systems to U.S. Federal 2.0 Standards

Step 2 - Technical Data Package Review; Reviews submitted documents against documentation

 requirements of outside agencies, published standards, or U.S. specifications

Step 3 - Physical Configuration Audit; Examines the documentation of the system against the actual

 submitted system

Step 4 - System Integration Testing; Executes tests on all components of a system configured as if the

 system was deployed

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Step 5 - Functional Configuration Audit; Examines submitted test data and conducts additional testing to

 verify submitted system hardware and software described in the documents submitted to the

 Elections Assistance Commission and the Department of Homeland Security

Step 6 – Security Testing; Performs vulnerability assessments and penetration analysis to assess system

 vulnerabilities

Most states have a vote by mail process right now. Voters may request an Absentee Mail Ballot from their County Board of Elections, or a Vote by Mail ballot is sent. In either case, our proprietary registration and tabulation software has an immediate need. In the 2020 election, 69% of voters nationwide cast their ballot nontraditionally by mail and/or before Election Day. This is the highest rate of nontraditional voting for a presidential election since questions regarding voting method have been included in the survey. By comparison, about 40% of voters cast their ballots by mail and/or prior to Election Day in 2016. Much of the surge in nontraditional voting was due to an increase in mail-in voting.

In 2020, 43% of voters cast ballots by mail and another 26% voted in person before Election Day. In 2016, 21% mailed in their ballots and 19% voted in person prior to Election Day. (US Census Bureau 4/29/21)

Most individuals think only of the Presidential election every four years as the Election. In reality, municipal Board of Elections throughout the U.S. are conducting elections annually for such elected positions as; Governor, Mayor, City Council, State Assembly, State Senate, Members of U.S. Congress (House every 2 years, Senate every 6) Civil and Criminal Justices, Sheriffs, School Boards, Village Trustees, etc. In short, most State and local municipal Board of Elections are in the market purchasing software and hardware every year.

2) Management also sees an opportunity in developing and creating Blockchain Voting Technology, and is working with Blockchain Valley Ventures and TrueVote Inc, which Management believes could positively impact Global in many aspects of its business, including;

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Securely storing and creating accurate Voter Registration Information on the blockchain.

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Creating an international capability to administer or joint venture in conducting foreign government elections.

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Creating a secure Internet voting record on the blockchain for online elections.

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Administer Financial Services Elections, such as Proxy’s and shareholder votes.

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Documenting current voting applications.

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Reducing cost and time of delivery, enabling scalability.

Blockchain Valley Ventures

On June 27, 2019, Blockchain Valley Ventures and GES signed an amended agreement calling for a $25,000 CHF payment for the development and facilitation of an extended workshop with relevant and best in class third party blockchain technology companies, wherein BVV was to  serve as an advisor in connection with a Voter Registration, Voter Authentication, and Voter Eligibility using a Blockchain Platform and GES would pay BVV $ 25,000 CHF payment upon completion of the engagement. This agreement replaced a June 19, 2019, engagement letter with Blockchain Valley Ventures (“BVV”) of Zug Switzerland. Under the terms of the original agreement, GES was to pay BVV 50,000 Swiss Francs (CHF).

 GES made payments of $25,000 CHF and received the working paper primarily covering the following matters:

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Development and facilitation of an extended workshop with relevant and best in class third party blockchain technology companies such as Phoenix Systems AG, Securosys AG and others as well as any subject matter expert to be invited by Global Election Services Inc.

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Development of a high-level technology solution architecture and its requirements for the blockchain based voting registration platform with inputs from third party blockchain technology.

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Documentation of the results of a) and b) in order to provide the basis of the technical development of the platform.

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Development of an implementation recommendation with respect to Voting on the Blockchain Platform.

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Legal facilitation with respect to outside tax and legal advisors in connection with compliance with local and international regulation.

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Project Management during the engagement.

The Working Paper discusses a high-level envisaged Blockchain platform, including a foundational flowchart, and implementation recommendation; BVV is a Crypto Valley, Switzerland based venture capital firm who consists of highly successful entrepreneurs, finance experts, blockchain technology experts and ICO experienced analysts and consultants. The documents created will be used by GES, to begin to create a Minimal Viable Product. This Product, along with GES licensing rights on GES existing Registration and Tabulation Software will be owned by GES. The anticipated development start is in the 1^st quarter 2023.

GES is developing with TrueVote, Inc. a comprensive end-to-end, decentralized, completely digital voting system. GAHC, GES parent owns 30% of True Vote.The TrueVote Voting System will be based on traditional, proven database methodologies and layered with a “checksum” that is posted on the blockchain, proving all data is immutable and unalterable.

On June 1, 2021, TrueVote issued its White Paper “A transparent Electronic Voting System validated by the Bitcoin Blockchain” TrueVote, Inc. is building a comprehensive end-to-end, de-centralized, completely digital voting system. This will be based on traditional, proven database methodologies, and layered with a "checksum" that's posted on the Blockchain, proving all data is immutable and unalterable. This design will ensure that every vote is transparently counted and verifiable.

True Vote is directed by Brett Morrison recently the Director of Enterprise Information Systems at SpaceX. Brett was as an e-commerce pioneer, getting brands online and creating a new channel for sales at the beginning of the e-commerce boom. Brett co-founded Onestop Internet in 2003 out of his garage and built the original e-commerce and warehouse management software that started the company. Throughout his time as Chief Technology Officer and Chief Innovation Officer at Onestop, he oversaw and managed its growth and architected and helped build the

new Onestop 2.0 platform. Prior to Onestop, Brett co-founded one of the first photo sharing companies on the Internet, ememories.com, which was sold to PhotoWorks, one of the largest photo processing companies in the U.S. True Vote is also directed by Ped Hasid who graduated UCLA with Magna Cum Laude Honors in 2007. Ped later went on to cofound Block26, a venture vehicle for the DLT space established in 2014, leading the technology and investment strategy for the firm. Block26 to date has financed and incubated innovative projects that aim to enhance consumer adoption of DLT technology.  

3) Interactive Communication Software

GES is working to provide our current and future clients with the ability to understand in real time instant communication and feedback with their members, using many social media platforms available today.

GES is working with third party vendors to:

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Communicate a Message – An organization can get their message out clearly in the form required, without any

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unwanted media spin, bias, filtering, or comment.

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Fine Tune Policies – Test-drive policies and projects with immediate response, allowing for responsive adjustments

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to be made to make a message more acceptable to the community.

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Build a Positive Image – Enhancing the concept of ‘open communication’ and ‘democratic politics’, which leads to

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an increasingly positive perception of leaders by their constituents.

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Learn More About a Group – Learning more about a group’s preferences and opinions on an infinite number of

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topics can help the Organization, Institution or League and leaders can better serve its community and

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meet their needs in a variety of ways.

Management believes this type of interactive software capabilities will give GES an opportunity to offer clients the ability to communicate in real time with their members; raising issues of concern, polling the attitude of their constituencies, interacting in question-and-answer seminars in addition to conducting elections that GES certifies.

In short, this software can be used in multiple formats for people to communicate instantly on issues of importance.

4) Tidewater Energy Group was formed for the purpose of creating diversification for the Company. Directed by Jason Old, Tidewater Energy Group brings a number of seasoned, well-respected members of the Energy Industry to the Company.

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ITEM 1A. RISK FACTORS

Not applicable to a smaller reporting company.

ITEM 1B. UNRESOLVED STAFF COMMENTS

Not applicable.

ITEM 2. PROPERTIES

The Company maintains a holding address at 208 East 51st Street, Suite 112, New York, NY 10022. During the years ended December 31, 2021, and 2020, the Company paid $12,651 and $14,664 for all office, storage, and other expenses, respectively.

ITEM 3. LEGAL PROCEEDINGS.

The Company may be involved in legal proceedings in the ordinary course of business. Such matters are subject to many uncertainties, and outcomes are not predictable with assurance.

On December 26, 2017, the Company entered into a settlement agreement with a prior attorney with regards to outstanding legal fees owed. Pursuant to this settlement agreement, the Company paid $25,000 on January 5, 2018, and $25,000 on February 5, 2018, and was required to pay an additional $200,000 during 2018. The $200,000 settlement was in default, and was carried in the accounts payable, however the Company is in the process of settling the outstanding balance. The Company made payments of $10,000 on the owed legal fees in 2020. On December 14, 2020, parties amended the settlement agreement to state that the Company shall pay the prior attorney Two Hundred Nineteen Thousand, Five Hundred and Seventy-Six Dollars and thirty-nine cents ($219,576.39).  The amount due shall be paid to the prior attorney in payments of Five Thousand Dollars per month for a period of thirty-four (34) months.

On October 16, 2020, the Company’s subsidiary, Tidewater Energy Group Corp. was named as a defendant in a lawsuit filed in District Court in and For Tulsa County, State of Oklahoma, CJ-2020-3172. The plaintiffs are seeking damages, disgorgement and specific performance relief relating to a Purchase and Sale Agreement to purchase all of the membership interests in Foster Energy.  On January 13, 2021, the plaintiffs added the Company to the lawsuit. The Company has obtained counsel to dispute the charges.  On March 18, 2021, the Company filed a motion to dismiss and brief in support which was denied by the Court pending further disclosures.  The Company asserted that the plaintiffs’ claims are entirely without merit as the Company was not a party to the Purchase and Sale Agreement or the related non-disclosure agreement.

ITEM 4.  MINE SAFETY DISCLOSURE

None

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PART II

ITEM 5.  MARKET FOR COMPANY’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

    Item 5(a)

a)  Market Information.  The Company began trading publicly on the NASD Over the Counter Bulletin Board on July 19, 2006.  We began trading under the symbol GAHC on May 27, 2011, and now trade under the symbol “GAHC” on the OTC Markets Pink Sheets.  The quotations represent inter-dealer prices without retail markup, markdown or commission, and may not necessarily represent actual transactions.

b)  Holders.  On March 31, 2022, there were 163 shareholders of record of our common stock.

c)  Dividends.  Holders of our common stock are entitled to receive such dividends as may be declared by our board of directors.  No dividends on our common stock have ever been paid, and we do not anticipate that dividends will be paid on our common stock in the foreseeable future.

d)  Securities authorized for issuance under equity compensation plans.  

Stock Awards plan

In June 2011, the Board of Directors adopted a Stock Awards Plan (“Plan”).  The purpose of the Plan is to attract, retain and motivate employees, directors and persons affiliated with the Company and to provide such participants with additional incentive and reward opportunities.  The awards may be in the form of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock awards, phantom stock awards, or any combination of the foregoing. The total number of shares of stock reserved for issuance under the Plan is 3,000,000.  

On December 8, 2017, the Company granted stock options to purchase 45,000,000 shares of the Company common stock.  The options were fully vested when issued with a fair value of approximately $972,000 at the grant date. Weighted average assumptions used to estimate the fair value of stock options on the date of grant are as follows:

The stock-based compensation related to stock options, included in stock compensation expense in the consolidated statements of operations, was $0 and $0 for the years ended December 31, 2021 and 2020, respectively.

The exercise price for options outstanding at December 31, 2021:

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A summary of the option activity is presented below:

e)  Performance graph.  Not applicable.

f)  Sale of unregistered securities.  

Common Shares

On April 28, 2016, the stockholders approved an amendment to the Company’s articles of incorporation to increase the number of authorized common shares from 100,000,000 to 1,000,000,000. In addition, the stockholders also approved an amendment to the Company’s Stock Awards Plan, originally filed June 27, 2011, which will increase the number of shares authorized to be issued under the Plan from 3,000,000 shares to 7,460,000 shares.

On September 7, 2021, the stockholders of the Company re-elect the three (3) directors to serve as members of the Board of Directors of the Company to serve for the ensuing three years and or until their successors are duly elected and qualified.  The directors named to our Board are John Matthews, Martin Doane, and Facundo Bacardi;

On September 7, 2021, the stockholders of the Company voted to authorize an increase in the Company’s authorized capital stock to 4,000,000,000 (four billion);

On September 7, 2021, the stockholders of the Company voted to authorize the Company to effectuate a 1 for 12 reverse split of the outstanding common shares;

 On September 7, 2021, the stockholders of the Company voted to ratify the appointment of Raul Carrega, CPA as the Company’s independent registered public accounting firm for the year ending December 31, 2021;

During the year ended December 31, 2021 the Company issued:

•

240,365,865 shares of common stock for the conversion of $270,149 of convertible notes and $102,179 of accrued interest;

•

1,072,893 shares of common stock for services rendered valued at fair value of $5,472.  The shares were valued at 0.0051.

•

75,000,000 shares of common stock in connection with a note settlement agreement valued at fair value of $487,500.

•

15,104,894 shares of common stock issued for cashless exercise of 24,545,454 warrants.

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During the year ended December 31, 2020, the Company issued:

•

522,533,554 shares of common stock for conversion of $598,973 of convertible notes and $90,597 of accrued interest;

•

36,519,609 shares of common stock for the conversion of 10,798 shares of series B Preferred stock; and

•

168,365,384 shares of common stock for services rendered valued at $290,221. The shares were valued based on the market price at the date of grant.

Warrants

A summary of warrant activity is presented below:

During the year ended December 31, 2021, the Company issued a total of 99,188,311 warrants in connection with new convertible promissory notes payable. The fair values of the warrants were determined using the Black-Scholes option pricing model with the following assumptions:

•

Expected life of 2-5 years

•

Volatility of 157% - 219%;

•

Dividend yield of 0%;

•

Risk free interest rate of 0.04% - 0.89%

During the year ended December 31, 2020, the Company issued a total of 167,675,780 warrants in connection with a new convertible promissory note payable. The fair values of the warrants were determined using the Black-Scholes option pricing model with the following assumptions:

•

Expected life of 2.00-3.00 years

•

Volatility of 135% - 190%;

•

Dividend yield of 0%;

•

Risk free interest rate of 0.15% - 1.59%

The fair values of the warrants were determined using the Black-Scholes option pricing model with the following assumptions:

    Item 5(b) Use of Proceeds.  Not applicable.

    Item 5(c) Purchases of Equity Securities by the issuer and affiliated purchasers.  Not applicable.

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ITEM 6.  SELECTED FINANCIAL DATA

Not applicable to a smaller reporting company.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-looking Statements

Statements in this Management’s Discussion and Analysis of Financial Condition and Results of Operation, as well as in certain other parts of this Annual report on Form 10-K (as well as information included in oral statements or other written statements made or to be made by the Company) that look forward in time, are forward-looking statements made pursuant to the safe harbor provisions of the Private Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, expectations, predictions, and assumptions and other statements that are other than statements of historical facts. Although the Company believes such forward-looking statements are reasonable, it can give no assurance that any forward-looking statements will prove to be correct.  Such forward-looking statements are subject to, and are qualified by, known and unknown risks, uncertainties and other factors that could cause actual results, performance, or achievements to differ materially from those expressed or implied by those statements. These risks, uncertainties and other factors include, but are not limited to the Company’s ability to estimate the impact of competition and of industry consolidation and risks, uncertainties and other factors set forth in the Company’s filings with the Securities and Exchange Commission, including without limitation to this Annual Report on Form 10-K.

The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this Form 10-K.

Current GES Corporate Operations

GES has developed and deployed proprietary Registration software, which was designed specifically to authenticate and register voters. This proprietary software functions as a data storage and retrieval registration system by cross-referencing eligibility status within a control voter database. In a mail ballot election, the voter’s ID barcode, QR code, or signature on the Business Reply Envelope, can be scanned and the status of that voter is identified. If the voter is not eligible to vote or another ballot for that individual has already been registered in the system, that ballot is marked VOID and removed from the count. In an in-person election, the voter provides their name for look-up in the system. If they have not voted, a signature box pops up on the screen, the voter signs an electronic signature pad and the digital signature is captured next to their name. If a voter tries to vote more than once, an alert will pop up indicating that the voter has already registered, and the voter will not receive an additional ballot. Because we account for every single ballot, the system has multiple reporting options, which include the list of valid envelopes and list of voters whose ballot was void, detailing the reason. Once the voter is authenticated, the identifiers are removed to ensure a secret vote and the ballot is scanned for tabulation.

GES developed proprietary Scanning and Tabulation election software. This software features advanced OMR/OCR/Barcode scanning and tabulation system featuring de-skewing, de-speckling and image correction. The computer hardware was designed to run hard wired without Internet or Wi-Fi access, ensuring complete security. The system allows for triple-auditing capabilities, which are; electronically generated tabulation results, .jpeg imaging and storage, and the original physical ballot. This advancement gives GES the ability to tabulate elections faster and more efficiently. As experts in paper/mail ballot elections, GES began deploying this system in our elections in the third quarter of 2017 and it has been operating flawlessly.

In 2020 GES developed, built and implemented a propriety online election voting solution that is compliant with Title IV of the United States Department of Labor Office of Labor-Management Standards.

GES built the platform on one of the most secure global infrastructures Amazon Web Services (AWS) which is a comprehensive, evolving platform provided by Amazon that includes a mixture of infrastructure as a service (IaaS) platform as a service and packaged software (PaaS), and software as a service offerings (SaaS).

The platform enables GES to protect individual client data, including the ability to encrypt it, move it, and manage retention (if required). All data flowing across the global network interconnects with the GES secured data center and is automatically encrypted at the physical layer before it leaves our secured facilities. Additional encryption layers exist as well.

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GES controls where our client data is stored, who can access it, and what resources your organization is utilizing at any given moment. Fine-grain identity and access controls combined with continuous monitoring for near real-time security information ensures that the right resources have the right access at all times, wherever your information is stored.

GES encryption software uses AES 256 with a cryptographic key using an RSA elliptic curve of 4096, which is used to encrypt the communication of the client and the GES server, as well all client data hosted in the server. A six-digit security code, delivered to the voter’s email address provided by the client, must be validated by the prospective voter in order to authenticate the identity of the voter before the voter may access the ballot. After validating the voter, the voter then votes anonymously, so that the identity of the voter and the ballot cast can never be matched.

The GES voting platform verifies that the users does not use the back and forward browser button, a safe mechanism against tampering. Distributed denial of service DDoS protection tools help secure websites and applications and prevent DDoS attacks, which bombard websites with traffic traditionally delivered via “botnets" that are created by networked endpoints connected via malware. The DDoS software protection provides always-on detection and automatic inline mitigations that minimize application downtime and latencya unique

Every state has Election Software Developers and Manufactures may also qualify by meeting individual requirements for individual States in the United States.

GES has begun undertaking the following six step benchmarks to qualify for the updated U.S. certification and is also considering individual State certifications;

Step 1 - Voting System Testing, Testing current developed systems to U.S. Federal 2.0 Standards

Step 2 - Technical Data Package Review; Reviews submitted documents against documentation requirements of outside agencies, published standards, or U.S. specifications

Step 3 - Physical Configuration Audit; Examines the documentation of the system against the actual submitted system

Step 4 - System Integration Testing; Executes tests on all components of a system configured as if the system was deployed

Step 5 - Functional Configuration Audit; Examines submitted test data and conducts additional testing to verify submitted system hardware and software described in the documents submitted to the Elections Assistance Commission and the Department of Homeland Security

Step 6 - Security Testing; Performs vulnerability assessments and penetration analysis to assess system vulnerabilities

Trends and Uncertainties

The Company currently has minimal revenues and operations and is investigating potential businesses and companies for acquisition to create and/or acquire a sustainable business. Our ability to acquire or create a sustainable business may be adversely affected by our current financial conditions, availability of capital and/ or loans, general economic conditions which can be cyclical in nature along with prolonged recessionary periods, and other economic and political situations.  

The Company has generated recurring losses and cash flow deficits from its operations since inception and has had to continually borrow to continue operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The continued operations of the Company are dependent upon its ability to raise additional capital, obtain additional financing and/or generate positive cash flows from operations.   Management believes that it will be successful in obtaining additional financing, from which the proceeds will be primarily used to execute its new operating plans. The Company plans to use its available cash and new financing to develop and execute its new business plan and hopefully create and maintain a self-sustaining business.  However, the Company can give no assurances that it will be successful in achieving its plans or if financing will be available or, if available, on terms acceptable to the Company, or at all.  Should the Company not be successful in obtaining the necessary financing to fund its operations, and ultimately achieve adequate profitability and cash flows from operations, the Company would need to curtail certain or all of its operating activities.  

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There are no trends, events or uncertainties that have had or are reasonably expected to have a material impact on the net sales or revenues or income from continuing operations. There are no significant elements of income or loss that do not arise from our continuing operations except for the fair value change on derivative financial instruments and settlement on arbitration.  

The rapid advances in computing and telecommunications technology over the past several decades have brought with them increasingly sophisticated methods of delivering administrating elections. Along with these advances, though, have come risks regarding the integrity and privacy of data, and these risks apply to election companies, falling into the general classification of cybersecurity. While it is not possible for anyone to give an absolute guarantee that data will not be compromised, when applicable, the Company shall utilize third-party service providers to secure the Company’s financial and personal data; the Company believes that third-party service providers provide reasonable assurance that the financial and personal data that they hold are secure.

Liquidity and Capital Resources

As of December 31, 2021, the Company has an accumulated deficit of $29,594,851 and a working capital deficit of $8,172,977. Our ability to continue as a going concern depends upon whether we can ultimately attain profitable operations, generate sufficient cash flow to meet our obligations, and obtain additional financing as needed.

For the year ended December 31, 2021, the Company recorded net loss of $910,162. We recorded an amortization of debt discount of $338,443, a change in fair value of derivative liability of $81,180 and a gain on settlement of debt of $509,080. We had an increase in accounts payable of $98,034 and a decrease in deferred revenue of $286,723. We also had an increase in accrued expenses of $828,071.  As a result, we had net cash used in operating activities of $(517,125) for the year ended December 31, 2021.

For the year ended December 31, 2021, we received $502,500 as proceeds from the issuance of convertible promissory notes payable and repaid $29,500 of convertible promissory notes resulting in net cash provided by financing activities of $473,000.

For the year ended December 31, 2020, the Company recorded a net loss of $1,723,083. We recorded an amortization of debt discount of $397,965, common stock issued for services of $290.221 and a change in fair value of derivative liability of $343,076. We had a decrease in accounts payable of $12,986, an increase in accrued expenses of $779,221 and an increase in deferred revenue of $267,723. As a result, we had net cash used in operating activities of $327,580 for the year ended December 31, 2020.

For the year ended December 31, 2020, we paid an acquisition deposit of $5,000.  

For the December 31, 2020, we received $445,000 as proceeds from the issuance of convertible promissory notes payable and repaid $72,500 of such convertible notes.  

Management believes that it will be able to continue its operations and further advance its acquisition plans. However, management cannot give assurances that such plans will materialize and be successful in the near term or on terms advantageous to the Company, or at all. Should the Company not be successful in its new business plans or obtain additional financing, the Company would need to curtail certain or all of its operating activities.

The Company’s continuation as a going concern is dependent upon its ability to ultimately attain profitable operations, generate sufficient cash flow to meet its obligations, and obtain additional financing as may be required. Our auditors for the years ended December 31, 2021 and 2020 have included a “going concern” modification in their auditors’ reports. A “going concern” modification may make it more difficult for us to raise funds when needed. The outcome of this uncertainty cannot presently be determined.

The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. There can be no assurance that management will be successful in implementing its business plan or that the successful implementation of such business plan will actually improve our operating results.

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     Results of Operations for the year Ended December31, 2021 compared to the year ended December 31, 2020

Revenues for the year ended December 31, 2021 were $1,223,116 compared to $641,629 for the year ended December 31, 2020 increase of $581,487. The majority of our clients hold elections on a three year cycle. This increase in revenues is due primarily to more elections held during the year of 2021 and the result of revenue from new customer.

Salaries and benefits totaled $591,595 for the year ended December 31, 2021, compared to $748,571 for the year ended December 31, 2020. This decrease was due to stock-based compensation in 2020.  There was no stock-based compensation in 2021.

Professional fees for the year ended December 31, 2021 totaled $412,798 compared to $351,367 for the year ended December 31, 2020, an increase of $61,431.

For the year ended December 31, 2021, we incurred marketing and advertising expenses of $200,554 compared to the $3.703 in the year ended December 31, 2020. We incurred software development expenses of $70,672 in 2021 compared to $120,554 in 2020, we incurred printing costs of $370,434 in 2021 compared to $220,043 in 2020, and we incurred general and administrative expenses of $249,065 in 2021 compared to $303,336 in 2020.  The decrease in general and administrative expenses was mainly due to a decrease in legal fee.

Total operating expenses for the year ended December 31, 2021 were $1,895,118 compared to $1,747,574 for the year ended December 31, 2020, an increase of $147,542 principally due to reasons discussed above.

Critical Accounting Policies

The Company’s financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management's applications of accounting policies. Critical accounting policies for the Company include revenue recognition, valuation of convertible promissory notes and related warrants, stock and stock option compensation, estimates, and derivative financial instruments.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of GAHI and its wholly owned and majority owned subsidiaries, GES and GAHI Acquisition Corp.  All significant intercompany accounts and transactions have been eliminated in consolidation.  

Revenue Recognition

The Company recognizes revenue in accordance with FASB ASC 606, Revenue From Contracts with Customers. The Company earns revenues through various services it provides to its clients. GES’s income is recognized at the presentation date of the certification of the election results. The payments received in advance are recorded as deferred revenue on the balance sheet. Should an election not proceed, all non-refundable deferred revenue will be recognized as revenue.

The Company’s revenue recognition policies comply with SEC revenue recognition rules and the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606-10-S65-1. The Company earns revenues through various services it provides to its clients. GES’s income is recognized at the presentation date of the certification of the election results. The payments received in advance are recorded as deferred revenue on the balance sheet. Should an election not proceed, all non-refundable deferred revenue will be recognized as revenue.

Convertible Debt

Convertible debt is accounted for under FASB ASC 470, Debt – Debt with Conversion and Other Options. The Company records a beneficial conversion feature (“BCF”) related to the issuance of convertible debt that has conversion features at fixed or adjustable rates that are in-the-money when issued and records the relative fair value of any warrants issued with those instruments. The BCF for the convertible instruments is recognized and measured by allocating a portion of the proceeds to the warrants and as a reduction to the carrying amount of the convertible instrument equal to the intrinsic value of the conversion features, both of which are credited to additional paid-in capital.  The Company calculates the fair value of warrants issued with the convertible instruments using the Black-Scholes valuation method, using the same assumptions used for valuing stock options, except that the contractual life of the warrant is used.  

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Under these guidelines, the Company allocates the value of the proceeds received from a convertible debt transaction between the conversion feature and any other detachable instruments (such as warrants) on a relative fair value basis.  The allocated fair value of the BCF and warrants are recorded as a debt discount and is accreted over the expected term of the convertible debt as interest expense.  

The Company accounts for modifications of its embedded conversion features in accordance with the ASC which requires the modification of a convertible debt instrument that changes the fair value of an embedded conversion feature and the subsequent recognition of interest expense or the associated debt instrument when the modification does not result in a debt extinguishment.

Derivative Financial Instruments

The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations. The Company uses the Black-Scholes-Merton model to value the derivative instruments. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.  

Share-Based Compensation

The Company records stock-based compensation in accordance with FASB ASC Topic 718, Compensation – Stock Compensation. FASB ASC Topic 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees.

Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity's Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity's Own Equity.  ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract.  ASU 2020-06 also removes certain conditions that should be considered in the derivatives scope exception evaluation under Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and clarify the scope and certain requirements under Subtopic 815-40.  In addition, ASU 2020-06 improves the guidance related to the disclosures and earnings-per-share (EPS) for convertible instruments and contract in entity’s own equity.  ASU 2020-06 is effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year.  The Company is currently evaluation the impact this ASU will have on its consolidated financial statements.

Management does not believe that any recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances.

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Off-Balance Sheet Arrangements

We do not maintain any off-balance sheet arrangements, transactions, obligations or other relationships with unconsolidated entities that would be expected to have a material current or future effect upon our financial condition or results of operations.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable

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ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Global Arena Holding, Inc. and Subsidiaries

Index to the Financial Statements

RAUL CARREGA

Certified Public Accountants

215 62^nd Street

Newport Beach, California 92663

818-248-6325

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders of

Global Arena Holding Inc. and Subsidiaries

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Global Arena Holding Inc. and Subsidiaries (the “Company”) as of December 31, 2021 and 2020 and the related consolidated statements of operations, stockholders’ deficit, and cash flows for each of the years in the two-year period ended December 31, 2021, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2021 and 2020, and the consolidated results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Going concern uncertainty

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1 to the consolidated financial statements, the Company has suffered recurring losses since inception, experiences a deficiency of cash flow from operations, sold its principal operating business, is currently in default of certain outstanding notes, and has a stockholders’ deficit. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties. Our opinion is not modified with respect to this matter.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Raul Carrega

Raul Carrega, CPA

We have served as the Company’s auditor since 2016.

Newport Beach, California

April 1, 2022

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GLOBAL ARENA HOLDING, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

GLOBAL ARENA HOLDING, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020