UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-QSB

[x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF
1934

For the Quarter Ended March 31, 2002

Commission File Number 000-31233

Green Dolphin Systems Corporation

(Name of Small Business in its Charter)

Delaware                                                                                                                    88-0432539

(State or other jurisdiction of   incorporation or organization)      IRS Employer Identification No.

2338 W Beaver Creek Rd., Powell, TN 37849

(Address of principal executive offices) (Zip code)

Issuer's Telephone number: (888) 379-8693

Transitional Small business Disclosure Format (Check one):  Yes []  No [X]

**PART I**

**ITEM 1. FINANCIAL STATEMENTS**

Green Dolphin Systems Corporation

INDEX TO FINANCIAL STATEMENTS

CONTENTS

|Balance Sheets at March 31, 2002 (unaudited) and December 31, 2001                                 | 3    
|-------------------------------------------------------------------------------------------------- | -----
|Statements of operations three months ended March 31, 2002 (unaudited) and
2001 (unaudited)        | 4    
|Statements of Changes in Stockholders' Equity                                                      | 5    
|Statement of Cash Flows for the three months ended March 31, 2002
(unaudited) and 2001 (unaudited) | 6    
|Notes to Financial Statements                                                                      | 7 - 8

Green Dolphin Systems Corporation

Balance Sheets

|                                                                                     | unaudited
March 31, 2002 | December 31,
2001
|------------------------------------------------------------------------------------ | ------------------------ | -----------------
|ASSETS                                                                               |                          |                  
|Current                                                                              |                          |                  
|Cash                                                                                 | $ 28,306                 | $ 15,243         
|Accounts receivable                                                                  | 24,151                   | 7,252            
|Inventory                                                                            | 32,594                   | 28,493           
|Prepaid expenses                                                                     | 1,650                    | 1,650            
|                                                                                     | 86,701                   | 52,638           
|Capital                                                                              |                          |                  
|Shop equipment                                                                       | 9,391                    | 9,391            
|Office furniture and equipment                                                       | 2,658                    | 1,558            
|                                                                                     | 12,049                   | 10,949           
|Less:  Accumulated depreciation                                                      | 4,690                    | 4,149            
|                                                                                     | 7,359                    | 6,800            
|Other Assets                                                                         |                          |                  
|Trademarks and copyrights (net of amortization
of $56,669, $51,669 at December 2001) | 243,331                  | 248,331          
|                                                                                     | $ 337,391                | $ 307,769        
|LIABILITIES AND SHAREHOLDERS'
EQUITY                                                 |                          |                  
|Current                                                                              |                          |                  
|Accounts payable and accrued liabilities                                             | $ 29,671                 | $ 27,843         
|Due to related companies (Note 2)                                                    | 227,759                  | 173,405          
|                                                                                     | 257,430                  | 201,248          
|Shareholders' equity                                                                 |                          |                  
|Common stock                                                                         | 19,899                   | 19,899           
|Additional paid in capital                                                           | 336,407                  | 336,407          
|(Deficit) Retained earnings                                                          | (276,345)                | (249,785)        
|                                                                                     | 79,961                   | 106,521          
|                                                                                     | $ 337,391                | $ 307,769        

Green Dolphin Systems Corporation

Statements of Operations

|                                                                    | (unaudited)
three
months
ended
March 31 |           
|------------------------------------------------------------------- | --------------------------------------- | ----------
|                                                                    | 2002                                    | 2001      
|Sales                                                               |                                         |           
|Related party                                                       | $32,023                                 | $148,724  
|Other                                                               | 112,763                                 | 32,575    
|                                                                    | 144,786                                 | 181,299   
|Cost of sales                                                       | 54,564                                  | 55,145    
|Gross margin                                                        | 90,222                                  | 126,154   
|                                                                    |                                         |           
|General and administrative expenses                                 | 116,782                                 | 143,757   
|Net Income (Loss)                                                   | $(26,560)                               | $(17,603) 
|Earnings per share:

Basic and diluted                              | $-                                      | $-        
|Net income (loss) and comprehensive  income (loss) per
common share | $-                                      | $-        
|Basic and diluted weighted average shares outstanding               | 19,898,700                              | 19,898,700

Green Dolphin Systems Corporation

Statements of Changes in Stockholders' Equity

Three Months Ended March 31, 2002, and Year Ended December 31, 2001

|                                   | Common Stock | Additional
Paid In
Capital | Retained
Earnings | Total      
|---------------------------------- | ------------ | -------------------------- | ----------------- | -----------
|                                   | Shares       | Amount                    
|Balance
January 1,
2001            | 19,898,700   | $ 19,899                   | $ 336,407         | $ (156,280)
|Net income
(loss) for
year         | -            | -                          | -                 | (93,505)   
|Balance,
December
31, 2001         | 19,898,700   | $ 19,899                   | $ 336,407         | $ (249,785)
|Net income
(loss) for
three
months | -            | -                          | -                 | (26,560)   
|Balance,
March 31,
2002            | 19,898,700   | $ 19,899                   | $ 336,407         | $ (276,345)

Green Dolphin Systems Corporation

Statements of Cash Flows

For the three months ended March 31, 2002 and 2001

|                                                               | unaudited
2002 | unaudited
2001
|-------------------------------------------------------------- | -------------- | --------------
|Net cash used in operations                                    | $ (40,192)     | $ (4,071)     
|Investment activities:

Acquisition of furniture and equipment | (1,100)        | -             
|                                                               | (1,100)        | -             
|Financing activities:

Advances from (to) related company      | 54,355         | -             
|                                                               | 54,355         | -             
|Increase (Decrease) in cash                                    | 13,063         | (4,071)       
|Cash, beginning of period                                      | 15,243         | 13,054        
|Cash, end of period                                            | $ 28,306       | $ 8,983       

Green Dolphin Systems Corporation

Notes to Financial Statements

For the three Months ended March 31, 2002

(Unaudited)

1.  Significant accounting policies

Basis of Presentation

The accompanying unaudited financial statements of Green Dolphin Systems Corporation have
been prepared in accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-OSB and Article 10 of regulation S-X.
Accordingly, they do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.  In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered necessary for fair
presentation have been included.  Operating results for the three month and nine month periods
ended March 31, 2002 are not necessarily indicative of the results that may be expected for the
fiscal year ending December 31, 2002.

The data underlying the Balance Sheet as at December 31, 2001 and the Statement of
Stockholders' Equity for the year then ended was derived from audited financial statements but
does not include all disclosures required by generally accepted accounting principles.

For further information , refer to the audited financial statements and the footnotes thereto for the
fiscal year ended December 31, 2001 included in the Company's Annual Report on Form
10-KSB

The financial statements include the accounts of the Company and its wholly owned subsidiary,
Green Dolphin Systems Corporation (a Nevada corporation).

Inventories

Inventories are stated at the lower of cost (first-in, first-out method) or market.

Fixed assets and amortization

Fixed assets are recorded at cost. Amortization of the equipment is recorded using the straight
line method over the estimated lives of the related assets.

Upon disposal of an asset the gain or loss (if significant) is included in the computation of net
income for the year and the respective cost and accumulated amortization are removed from the
accounts.

Trademarks and copyrights

Trademarks and copyrights are recorded at cost and being amortised on a straight-line basis over
their estimated useful lives.

2. Transactions With Related Companies

To help accelerate the creation of a customer base and related sales the Company has entered into
a sales agency relationship with a Canadian company (Canada), which shares substantially
common ownership aand management with Green Dolphin Systems Corporation.  The essence of
the agreement calls for Canada to finance and carry its own inventory, and Canada is to be paid a
commission equal to 12% of the gross sales it generates.  Sales from Canada are computed
quarterly at which time the company reports the sales and is charged for the cost of the inventory
sold and the commission earned by Canada.

Management fees paid or accrued  to Canada

for the three months ended March 31, 2002 $ 45,000

**ITEM 2.  MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN OF OPERATION**

The operating loss from inception in January, 1999 through December 31, 2001 was $249,785.
During the first three months of 2002 operations, the company realized a loss of $26,560.  During
that period, sales decreased from $181,299 in 2001 to $144,786, a decrease of approximately
20%.  We believe this decrease in sales is attributable to (1) reduction of our staff by two
employees to effect operating efficiency; and (2) the fact that we concentrated our efforts in 2001
and early 2002 to the development and manufacturing of water-based waterproof Shield Kote
products used in construction and for home improvement.  Sale of these products is typically
slow during the first quarter of each year, but picks up substantially in the second and third
quarters.  The company is continuing to pursue master dealership agreements in the first quarter.
These contracts appoint Master Dealers to represent Green Dolphin products in larger geographic
areas than the local distributor agreements which are presently in force.  Our purpose in
appointing Master Dealers is to generate more widespread distribution, advertising, brand
recognition, consumer awareness and promotion of Green Dolphin products.  These agreement
require our Master Dealers to purchase products directly from the Company which we hope will
increase gross sales.  We believe  these dealership agreements will serve to increase sales
volume, though no assurance can be given that such will be the case.  We are also continuing to
pursue signing up additional international agents to market Green Dolphin products offshore .
Our international sales agency agreements require agents to purchase prescribed quantities of
Green Dolphin products directly from the Company.  We believe that these minimum purchase
requirements and increased international exposure to our products will increase sales.

Since December 2000, the Company has formalized a sales agency agreement with "Canada" to
compensate Canada a commission at the rate of 12% of all sales generated to the benefit of the
company.

Green Dolphin Systems Corporation is in the business of distributing water based, environmental
and user friendly products in three primary areas:

(1) products for the cleaning and remediation of ceiling and wall tiles,

(2) fire retardants suitable for use on fabrics, wood and other building materials, and

(3) non-slip products suitable for use on tile, concrete, linoleum, and most other flooring
surfaces.

The Company also distributes a line of water based clear and tinted wood stain products.  In
terms of gross revenues,

35% are derived from the sale of ceiling tile and wall restorer,

25% are from non-slip treatment, and

25% are produced from the sale of fire retardant products.

15% from other products

As revenues increase, the Company intends to increase expenditures for tradeshow presentations,
trade journal advertising and direct marketing by hiring additional in-house sales personnel.
Such increases will be effected only if warranted by increased revenues.

Green Dolphin believes there are significant market trends which are contributing to its increased
sales.

The first is market recognition that the ceiling tile remediation products distributed by Green
Dolphin can restore the appearance of these tiles and extend their presentable and useful life,
forestalling the  expenditure of millions of dollars for replacement.

The second is the increase in fire and building codes which are increasingly requiring wood,
fabric and other construction and decorating materials to be fire-retardant treated.  An example is
NFPA Section 701 which now requires that all fabric materials, including drapes, fabric wall
coverings, curtains and some furniture coverings must be treated with a fire retardant.  In 1996,
the NFPA Compendium for Revision of Fire Codes published an article explaining the tightened
regulations adopted in Section 701.  Green Dolphin's fire-retardant products have been tested to
meet applicable fire code standards.

The third factor to have a very substantial effect on Green Dolphin's sales is the enactment of
amendments to the American Disabilities Act to require non-slip treatment of floors in all public
buildings.  The non-slip products distributed by Green Dolphin are sprayed onto floors and
worked into them by use of rotary buffers.  After a few minutes, treated floors show significant
resistance to slipping.

Finally, use of water-bourne, environmentally and user friendly wood stain products in lieu of the
solvent based products previously preferred by contractors and painters is widening according to
the Rauch Guide utilized by trade professionals.

Green Dolphin is aggressively working to increase its markets by use of two primary devices.

First, it is increasing the size of its market for ceiling and wall cleaners, fire retardant and
non-slip floor treatment products by aggressively working to increase the number of product
distributors from the present level of twenty-five to thirty distributors by the end of the year.
This is being done through increased participation in trade shows, trade journal advertising and
face-to-face presentations.

Second, the Company is working to set up businesses and individuals in numerous market areas
who will be in the business of applying Green Dolphin cleaning, fire-retardant and non-slip
products directly on the job.  Presently, the Company's program of selectively advertising these
business opportunities in trade journals and making presentations of Green Dolphin products at
trade shows throughout the U.S. and Canada has resulted in the establishment of twenty-five
restoration companies who are selling and applying a group of Green Dolphin products on site.
This has been a significant factor in contributing to what is expected to be an increase in
projected gross revenue in 2002 over 2001.  The Company initiated a program of referring
customers who have expressed an interest in Green Dolphin products to local "applicators" rather
than doing the work itself.  This policy will increase the attractiveness of dealerships by
increasing dealer sales, and serve the interest of the Company by reducing expenses.

At the present time Green Dolphin does not have any substantial commitments for capital
expenditures.  It intends to operate on its current business plan, without substantial change or
additional expenditures, for the foreseeable future.

Green Dolphin expects revenue growth experienced to continue in fiscal 2002 as a result of:

(1) increased tradeshow and trade journal advertising,

(2) increased sales by current dealers and distributors who have been appointed during the last
few months,

(3)  appointment of additional dealers and distributors,

(4) increased revenue from retail sales through hardware and lumber stores, department stores
and home centers who have recently begun carrying Green Dolphin products.

The Company also expects to sign up at least two international agents during fiscal 2002.  There
is no known fact which would cause the expenses of operation to increase without more than
corresponding increases in revenues. Though the volume of sales fluctuates somewhat from
quarter to quarter, those fluctuations are not seasonal.  They result from natural variations in
selling success, which are typical of companies involved in product distribution.

Green Dolphin believes it will continue as a going concern on the basis of present revenues from
operations despite the continuing operating losses because (1) about $20,000 of its $93,505 2001
operating loss is non-cash attributable to depreciation expense, and (2) significant portions of the
losses are attributable to debts owed to the related companies Penta Deltex and Green Dolphin
Canada of $153,684 and $19,721, respectively at December 31, 2001.  Repayment will be
dictated by the availability of cash.  Exclusive of this indebtedness to related parties, Green
Dolphin's ratio of current assets to current liabilities at December 31, 2001 was 1.89 to 1.  At
March 31, 2002, this ration is 2.9 to 1.  The debts to related companies are unsecured, bear no
interest, and have no specific terms of repayment.

(1) The uncertainty of additional financing;

(2) The start-up posture of the Company;

(3) The limited scope of the present market for the Company's products, and

(4) The early stage of execution of its business plan.

Furthermore, there is no present trading market for Green Dolphin shares, and development of
such a trading market will likely be restricted by the application of the "Penny Stock Rules"
which prohibit securities brokers from soliciting transactions in shares of small issuers whose
shares are traded at prices below $5 per share.

**PART II**

**ITEM 1. LEGAL PROCEEDINGS.**

To the best of the Company's knowledge, the Company is not a party to any pending legal
proceedings.

**ITEM 2. CHANGES IN SECURITIES**.

There have been no changes in the Company's securities.

**ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.**

There have been no defaults upon senior securities.

**ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.**

There have been no Submission of matters to a vote of security holders

**ITEM 5. OTHER INFORMATION.**

There is no other information to report

**ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K**.

No report on Form 8-K was filed by the Company during the three month period ending March
31, 2002.

**SIGNATURES**

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

GREEN DOLPHIN SYSTEMS CORPORATION

By:/s/ Nicholas Plessas

Nicholas Plessas, President

Date: May 22, 2002****