What changed in this filing

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Item 1A. Risk Factors

2021-03-31 compared with 2020-05-27 · 92 added, 116 removed, 203 unchanged (51% of the section changed)

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THE RISK THAT WE WILL NOT BE SUCCESSFUL.

only recently started our operations in our current business in 2015.

We have a limited operating history in an evolving industry

that may not develop as expected.

Assessing our business and future prospects is challenging in light of the risks and difficulties

we may encounter.

have a limited operating history in an evolving industry that may not develop as expected.

Assessing our business and future prospects

is challenging in light of the risks and difficulties we may encounter.

These risks and difficulties include our ability to:

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COVID-19 pandemic

the demand for our products offered through our points of sales or our products under development are not finalized, our business

the demand for our services and/or platforms/products offered or our products under development are not finalized, our business

will be harmed.

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ESTIMATES OF OUR FUTURE PERFORMANCE.

shifted our focus to our real-time, heuristic- (self-learning/artificial intelligence) based mobile technology in 2015 and recently

acquired point of sale terminals.

We have a limited operating history and generated approximately $14.5 million in

revenue for the year ended December 31, 2018 and approximately $19.2 million for the year ended December 31, 2019.

a consequence, it is difficult, if not impossible, to forecast our future results based upon our historical data.

on the historical results may not be representative of the results we will achieve.

Because of the uncertainties related

to our limited historical operations, we may be hindered in our ability to anticipate and timely adapt to increases or decreases

in revenues or expenses.

If we make poor budgetary decisions as a result of unreliable historical data, we could be less

profitable or continue to incur losses.

COVID-19 outbreak has caused disruptions in our development operations, which have resulted in delays on exiting projects and

have a limited operating history and, as a consequence, it is difficult, if not impossible, to forecast our future results

based upon our historical data.

Reliance on the historical results may not be representative of the results we will achieve.

Because of the uncertainties related to our limited historical operations, we may be hindered in our ability to anticipate and

timely adapt to increases or decreases in revenues or expenses.

If we make poor budgetary decisions as a result of unreliable

historical data, we could be less profitable or continue to incur losses.

COVID-19 OUTBREAK HAS CAUSED DISRUPTIONS IN OUR DEVELOPMENT OPERATIONS, WHICH HAVE RESULTED IN DELAYS ON EXISTING PROJECTS AND

MAY HAVE ADDITIONAL NEGATIVE IMPACTS ON OUR OPERATIONS

Company operates in a high-tech marketplace and relies on professionals and partnerships all over the world, which is impacted

by the global pandemic, causing the Company’s resources to be affected.

by the global pandemic, causing the Companys resources to be affected.

Our business operations have been and may continue

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COVID-19 is considered to be highly contagious and poses a serious public health threat.

March 19, 2020, the California Governor announced the lockdown of California in an attempt to slow the spread of the virus.

then, other measures have been imposed in other countries and major cities in the USA, including Los Angeles, and throughout the

world in an effort to contain the COVID-19 outbreak.

The World Health Organization (the “WHO”) is closely monitoring

and evaluating the situation.

On March 11, 2020, the WHO declared the outbreak of COVID-19 a pandemic, expanding its assessment

of the threat beyond the global health emergency it had announced in January.

Any outbreak of such epidemic illness or other adverse

public health developments in the USA or elsewhere in the world may materially and adversely affect the global economy, our markets

and our business.

March 19, 2020, California Governor Gavin Newsom issued a stay at home order to protect the health and well-being of all Californians

and to establish consistency across the state in order to slow the spread of COVID-19.

California was therefore under strict quarantine

control and travel has been severely restricted, resulting in disruptions to work, communications, and access to files (due to

limited access to facilities).

Since then, other measures have been imposed in other countries and major cities in the USA, including

Los Angeles, and throughout the world in an effort to contain the COVID-19 outbreak.

The World Health Organization (the WHO)

is closely monitoring and evaluating the situation.

On March 11, 2020, the WHO declared the outbreak of COVID-19 a pandemic, expanding

its assessment of the threat beyond the global health emergency it had announced in January.

Any outbreak of such epidemic illness

or other adverse public health developments in the USA or elsewhere in the world may materially and adversely affect the global

economy, our markets and our business.

The stay at home order was lifted in California only on January 25, 2021, and as such we

were able to relocate our virtual offices space and resume normal operations.

the first quarter of 2020, the COVID-19 outbreak has caused disruptions in our development operations, which have resulted in

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RESULTS OF OPERATIONS HAVE NOT RESULTED IN PROFITABILITY AND WE MAY NOT BE ABLE TO ACHIEVE PROFITABILITY GOING FORWARD

Company does not accrue or capitalize development costs (or any costs to this effect) and expense it to its profit and loss statements

as required by US GAPP.

As such, the Company incurred a net loss amounting to $51,769,670 for the year ended December 31, 2018,

and $186,505,119 for the year ended December 31, 2019.

If we incur additional significant operating losses, our stock

price, may decline, perhaps significantly.

Our management is developing plans to alleviate the negative trends and conditions

described above.

The Company does not accrue or capitalize development

costs (or any costs to this effect) and expense it to its profit and loss statements as required by US GAAP.

As such, the Company incurred

a net loss amounting to $17,994,888 for the year ended December 31, 2020, and $186,505,119 for the year ended December 31, 2019.

we incur additional significant operating losses, our stock price, may decline, perhaps significantly.

Our management is developing plans

to alleviate the negative trends and conditions described above.

Our business plan is speculative and unproven.

There is no assurance that we will be successful in

executing our business plan or that even if we successfully implement our business plan, that we will be able to curtail our losses

now or in the future.

Further, as we are an emerging enterprise, we expect that net losses will continue, and our working

capital deficiency will increase.

HAVE GENERATED INSIGNIFICANT POSITIVE CASH FLOW, AND OUR ABILITY TO GENERATE POSITIVE CASH FLOW IS UNCERTAIN.

IF WE ARE UNABLE

TO GENERATE POSITIVE CASH FLOW OR OBTAIN SUFFICIENT CAPITAL WHEN NEEDED, OUR BUSINESS AND FUTURE PROSPECTS WILL BE ADVERSELY AFFECTED

AND WE COULD BE FORCED TO SUSPEND OR DISCONTINUE OPERATIONS.

operations have generated insignificant positive cash flow for any reporting period since our inception, and we have funded our

operations primarily through the issuance of common stock and short-term and long-term debt and convertible debt.

operating history makes an evaluation of our future prospects difficult.

The actual amount of funds that we will need to meet

our operating needs will be determined by a number of factors, many of which are beyond our control.

These factors include the

timing and volume of sales transactions, the success of our marketing strategy, market acceptance of our products, the success

of our manufacturing and research and development efforts (including any unanticipated delays), our manufacturing and labor costs,

the costs associated with obtaining and enforcing our intellectual property rights, regulatory changes, competition, technological

developments in the market, evolving industry standards and the amount of working capital investments we are required to make.

assurance that we will be successful in executing our business plan or that even if we successfully implement our business plan, that

we will be able to curtail our losses now or in the future.

Further, as we are an emerging enterprise, we expect that net losses

will continue, and our working capital deficiency will increase.

HAVE NOT GENERATED POSITIVE CASH FLOW FROM OPERATIONS, AND OUR ABILITY TO GENERATE POSITIVE CASH FLOW IS UNCERTAIN.

UNABLE TO GENERATE POSITIVE CASH FLOW OR OBTAIN SUFFICIENT CAPITAL WHEN NEEDED, OUR BUSINESS AND FUTURE PROSPECTS WILL BE ADVERSELY

AFFECTED AND WE COULD BE FORCED TO SUSPEND OR DISCONTINUE OPERATIONS.

operations have not generated positive cash flow for any reporting period since our inception, and we have funded our operations

primarily through the issuance of common stock and short-term and long-term debt and convertible debt.

Our limited operating history

makes an evaluation of our future prospects difficult.

The actual amount of funds that we will need to meet our operating needs

will be determined by a number of factors, many of which are beyond our control.

These factors include the timing and volume of

sales transactions, the success of our marketing strategy, market acceptance of our products, the success of our manufacturing

and research and development efforts (including any unanticipated delays), our manufacturing and labor costs, the costs associated

with obtaining and enforcing our intellectual property rights, regulatory changes, competition, technological developments in

the market, evolving industry standards and the amount of working capital investments we are required to make.

ability to continue to operate until we are able to generate sufficient our cash flow from operations will depend on our ability

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our business and future prospects will be adversely affected and we could be forced to suspend or discontinue operations.

Company sustained net losses of $186,505,119 and our operating activities used cash flows of $6,623,463 for the year ended December

The Company had a working capital deficit of $11,830,572 stockholders’

deficit of $18,712,886 and an accumulated

deficit of $252,656,451 at December 31, 2019.

Over the same period in 2018, the Company sustained net losses of $51,769,670, and

our operating activities used cash flows of $4,651,829.

In 2018, the Company had a working capital deficit of $3,897,716 (after

excluding $4,223,011 classified as assets of discontinued operations), stockholders’

equity of $14,516,389, and an accumulated

deficit of $66,151,332.

The Company sustained net losses of $17,994,888 and

our operating activities used cash flows of $994,426 for the year ended December 31, 2020.

The Company sustained net losses of $186,505,119

and our operating activities used cash flows of $6,623,463 for the year ended December 31, 2019.

The Company had a working capital deficit

of $27,710,040, stockholders’

deficit of $27,858,303 and an accumulated deficit of $270,651,339 at December 31, 2020.

WILL REQUIRE ADDITIONAL CAPITAL TO SUPPORT BUSINESS GROWTH, AND THIS CAPITAL MIGHT NOT BE AVAILABLE ON ACCEPTABLE TERMS, IF AT

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We expect that we have sufficient capital to maintain

operations through the third quarter of 2020.

operations through the year of 2021.

In order to fully implement our business plan, we will need to raise $10,000,000.

If we raise additional funds through future issuances of equity or convertible debt securities, our existing stockholders could

suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to

those of holders of our common stock.

Any debt financing that we secure in the future could involve restrictive covenants relating

to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain

additional capital and to pursue business opportunities, including potential acquisitions.

We may not be able to obtain additional

financing on terms favorable to us, if at all.

If we are unable to obtain adequate financing or financing on terms satisfactory

to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be

impaired, and our business may be harmed.

additional funds through future issuances of equity or convertible debt securities, our existing stockholders could suffer significant

dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of

our common stock.

Any debt financing that we secure in the future could involve restrictive covenants relating to our capital

raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital

and to pursue business opportunities, including potential acquisitions.

We may not be able to obtain additional financing on terms

favorable to us, if at all.

If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require

it, our ability to continue to support our business growth and to respond to business challenges could be impaired, and our business

may be harmed.

DEPEND UPON KEY PERSONNEL AND NEED ADDITIONAL PERSONNEL

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could have a material and adverse effect on our business operations.

Additionally, the success of the Company’s

Additionally, the success of the Companys

operations will largely depend upon its ability to successfully attract and maintain competent and qualified key management personnel.

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operations, which could harm our revenues, profitability, financial condition and business prospects.

SINGLE STOCKHOLDER HOLDS A CONTROLLING INTEREST IN OUR COMPANY, WHICH COULD LIMIT YOUR ABILITY TO INFLUENCE THE OUTCOME OF ANY

STOCKHOLDER VOTE

Gonzalez, through GBT Tokenize Corp.

and the Gonzalez Trust, beneficially owns approximately 59.6% of the outstanding shares of

Common Stock.

Under our Certificate of Incorporation and Nevada law, the vote of a majority of the shares outstanding is generally

required to approve most stockholder action.

As a result, this stockholder will be able to significantly influence the outcome

of stockholder votes for the foreseeable future, including votes concerning the election of directors, amendments to our Certificate

of Incorporation or proposed mergers or other significant corporate transactions.

IS CURRENTLY A LIMITED PUBLIC MARKET FOR OUR COMMON STOCK.

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resources and the reliance on outside consultants.

We intend to increase management’s review of our financials.

We intend to increase managements review of our financials.

be certain that these measures will ensure that we implement and maintain adequate controls over our financial processes and reporting

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volatility in the market price of our stock and have difficulty selling their shares.

Common Stock is currently quoted on the OTC Market Group’s OTC PINK marketplace under the ticker symbol “GTCH”

((prior year under the symbol:

“GOPH”).

Common Stock is currently quoted on the OTC Market Groups OTC PINK marketplace under the ticker symbol GTCH

((prior years under the symbol:

The OTC is a regulated quotation service that displays real-time quotes and

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eligible for future sale may adversely affect the market for our Common Stock.

the 171,496,091 shares of our Common Stock outstanding as of the date of this Annual Report, approximately 61,389,407 shares are

held by “non-affiliates,”

and about 48,371,849 shares are freely tradable without restriction pursuant to Rule 144.

Any substantial sale of our Common Stock pursuant to Rule 144 or pursuant to any resale prospectus may have a material adverse

effect on the market price of our Common Stock.

the 493,110,305 shares of our Common Stock outstanding as of the date of this Annual Report, approximately 122,894,088 are restricted

and 370,216,217 shares are freely tradable without restriction pursuant to Rule 144.

Any substantial sale of our Common Stock

pursuant to Rule 144 or pursuant to any resale prospectus may have a material adverse effect on the market price of our Common

may experience future dilution as a result of future equity offerings.

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of our Common Stock, in future transactions may be higher or lower than the price per share paid by investors in this offering.

The Company filed Form S-1 registration statement with the SEC on or around February 8, 2019 for potentially 225,000 dilutive

common shares (post reverse split) issued potentially be issued from the exercise of certain warrants in connection with a transaction

with an unaffiliated third party institutional investor.

The S-1 will become effective either after the filing of this report,

or at the same time.

There can be no assurance that the investor that holds the warrants will exercise those warrants.

have varying exercise prices, the lowest of which is $50 (post reverse split).

charter documents and Nevada law may inhibit a takeover that stockholders consider favorable.

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permitted by Nevada law, our certificate of incorporation limits the liability of our directors for monetary damages for breach

of a director’s fiduciary duty except for liability in certain instances.

of a directors fiduciary duty except for liability in certain instances.

As a result of our charter provision and Nevada

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stock regulations may impose certain restrictions on marketability of our securities.

SEC has adopted regulations which generally define a “penny stock”

to be any equity security that has a market price

SEC has adopted regulations which generally define a penny stock to be any equity security that has a market price

of less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions.

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covered by such rules, the broker-dealer must make a special suitability determination for the purchase of such securities and

have received the purchaser’s written consent to the transaction prior to the purchase.

have received the purchasers written consent to the transaction prior to the purchase.

Additionally,

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payable to both the broker-dealer and the registered representative, current quotations for the securities and, if the broker-dealer

is the sole market maker, the broker dealer must disclose this fact and the broker-dealer’s presumed control over the market.

is the sole market maker, the broker dealer must disclose this fact and the broker-dealers presumed control over the market.

Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information

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regarding a security before effecting a transaction in such security.

Consequently, the “penny stock”

rules restrict

Consequently, the penny stock rules restrict

the ability of broker-dealers to sell our securities and affect the ability of investors to sell our securities in the secondary

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of prices through prearranged matching of purchases and sales and false and misleading press releases;

“boiler

practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons

room practices involving high pressure sales tactics and unrealistic price projections by inexperienced sales persons;

and undisclosed bid-ask differentials and markups by selling broker-dealers;

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along with the inevitable collapse of those prices with consequent investor losses.

sales practice requirements may limit a stockholder’s ability to buy and sell our stock.

sales practice requirements may limit a stockholders ability to buy and sell our stock.

Financial Industry Regulatory Authority (referred to as FINRA) has adopted rules requiring that, in recommending an investment

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to recommending speculative or low-priced securities to their non-institutional customers, broker-dealers must make reasonable

efforts to obtain information about the customer’s financial status, tax status, investment objectives and other information.

efforts to obtain information about the customers financial status, tax status, investment objectives and other information.

Under interpretations of these rules, FINRA has indicated its belief that there is a high probability that speculative or low-priced

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At this time, there are no unresolved staff comments.

Company leases its office space at 2450 Colorado Ave., Suite 100E, Santa Monica, CA 90404 on a month-to-month lease for $273 per

Due to the global COVID-19 pandemic, the Company has maintained its address but only as virtual office space with minimum

administrative services, while all employees and consultants work remotely.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors