Purthanol Resources Ltd - Quarter Report: 2013 February (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One) 

For the quarterly period ended February 28, 2013

For the transition period from ______________ to _______________

Commission File Number 000-33271

GLOBAL BIOTECH CORP

(Exact name of registrant as specified in its charter)

302-288-0658

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes [x] No [ ]

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

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

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

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

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

APPLICABLE ONLY TO CORPORATE ISSUERS:

As of August 26, 2013, the aggregate market value of the issuer's common stock based on its reported price on the OTC Bulletin Board held by non-affiliates of the issuer was approximately $114,903.

As of August 26, 2013, the Registrant had 82,073,890 shares of Common Stock outstanding. 

INDEX

 GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

FEBRUARY 28, 2013

(UNAUDITED)

NOTE 1 – BASIS OF PRESENTATION

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

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

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

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Earnings (Loss) Per Share

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

Recent Accounting Pronouncements

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

NOTE 3 – GOING CONCERN

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. The company reported net loss of $11,971 for the three months ended Feb 28, 2013 as well as reporting net losses of $3,574,849 from inception (November 2, 1998) to February 28, 2013. At February 28, 2013 the Company had negative working capital of $1,985,282 and stockholders’ deficit of $1,898,852. This condition raises substantial doubt about the Company's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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

GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

FEBRUARY 28, 2013

(UNAUDITED)

NOTE 4. SHORT TERM INVESTMENT

As of February 28, 2013, the Company had purchased a term deposit in the amount of CAD172,000 (USD 166,840), bearing interest rate of 5%, maturing on November 6, 2013. As of February 28, 2013, the Company accrued 26,842 USD of interest income. No withdrawals allowed for first 90 days and 90 days early withdrawal notice needed. Early withdrawal interest rate - 1 ½%.

NOTE 5. PROPERTY & EQUIPMENT

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

NOTE 6. NOTE PAYABLE TO RELATED PARTY

Note payable to related party as of February 28, 2013 and November 30, 2012 consist of the following:

NOTE 7. NOTES PAYABLE

Note payable as of February 28, 2013 and November 30, 2012 consist of the following:

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

GLOBAL BIOTECH CORP.

(A DEVELOPMENT STAGE COMPANY)

NOTES TO THE INTERIM FINANCIAL STATEMENTS

FEBRUARY 28, 2013

(UNAUDITED)

NOTE 8. STOCKHOLDERS' EQUITY

The stockholders' equity section of the Company contains the following classes of capital stock as of February 28, 2013 and November 30, 2012:

Common stock, $ 0.0001 par value; 260,000,000 shares and 260,000,000 shares authorized February 28, 2013 and November 30, 2012 : 82,073,890 shares issued and outstanding as of February 28, 2013 and November 30, 2012.

Preferred Stock, $0.0001 par value; 80,000,000 shares authorized as February 28, 2013 and November 30, 2012. Zero (0) shares issued and outstanding as of February 28, 2013 and November 30, 2012.

NOTE 9 - SUBSEQUENT EVENTS

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

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

Special Note Regarding Forward-Looking Statements

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

Plan of Operation.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Three months ended February 28, 2013 compared to February 29, 2012.

Professional, selling, general and administrative in 2013 was $16,231 and $14,462 in 2012, a difference of $1,769. This was due to higher other SG&A fees in 2013.

We had net interest expense, on our loans, of $15,002 in 2013 and $14,611 in 2012 and $15,868 of foreign exchange losses in 2012 vs $19,262 of gains in 2013.

As a result of the above, we had a net loss of $11,971 in 2013 and$49,941 in 2012.

Liquidity and cash flow needs of the company

From December 1st, 2012 to February 28, 2013 the company realized $22,436 from operating activities while recording no revenues. From March 1, 2013 to November 30, 2013, the fiscal year- end, the company’s net cash flow needs will be $200,000.

Item 4T. CONTROLS AND PROCEDURES QUARTERLY EVALUATION OF THE COMPANY’S DISCLOSURE CONTROLS AND INTERNAL CONTROLS.

As of August 26, 2013, the date of the report, our Principal Executive Officer, (CEO) and Chief Financial Officer (CFO) evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rule 13a -15(e) under the Securities Exchange act of 1934, as amended. Based upon that evaluation, the Principal Executive and Financial Officer concluded that, as of February 28, 2013, the Company’s disclosure controls and procedures are effective.

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

Part II other information

Item 2: Sales of Unregistered securities

None

Item (6) Reports on Form 8-K

Changes in Principal Officers and Directors

SIGNATURES

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