SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES ACT OF 1934
GlobaLock Corporation
(Name of Small Business Issuer in Its Charter)
Delaware 95-4702570
(State or other Jurisdiction of (IRS Employer Identification No.)
Incorporation or Organization)
860 Via de la Paz
Pacific Palisades, California 90272
(Address of Principal Executive Offices) (Zip Code)
(310) 230-6100
(Registrant's Telephone Number, Including Area Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange On Which
To Be So Registered Each Class Is To Be Registered
None Not Applicable
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock, $0.001 par value
<PAGE>
PART I
Item 1. Description of Business.
General
We formed GlobaLock Corporation ("Globalock") under the laws of
Delaware on August 5, 1998, for the purpose of engaging in a merger or other
business combination with a presently unidentified operating company. GlobaLock
has no predecessors and has never engaged in any business activity, other than
with respect to organizational matters. A business combination involving
GlobaLock, if any, will likely be effected through the acquisition of the equity
securities or assets of an existing business, or the merger of GlobaLock with
such a business in a transaction resulting in a change of control of GlobaLock.
GlobaLock is in the development stage and has no operating history. No
representation is made nor is any intended that our activities will be
profitable. The likelihood of our success must be evaluated in light of the
expenses, difficulties and delays frequently encountered in connection with the
formation of a new business. Furthermore, no assurance can be given that we will
have the ability to locate and acquire a business that we consider attractive.
We have not restricted our search for an attractive business to any specific
industry or area of business, and we cannot assure you that we will not attempt
a business combination with a business that has a history of operating or
financial difficulties that may increase the risks of an investment in
GlobaLock. Moreover, our management may not possess the experience and skills
necessary to make an informed judgment about the business or industry that may
be chosen. The selection of the business or industry, and the manner, in which a
business combination is conducted, is within management's sole and absolute
discretion.
Business Plan
GlobaLock's business plan is to seek, investigate, and, if such
investigation warrants, enter into a business combination with a presently
unidentified operating company that desires to realize the benefits of doing
business in the form of a publicly traded corporation. Benefits associated with
doing business as a publicly traded corporation may include greater availability
of additional equity financing, liquidity for stockholders and meaningful
benefits to key employees in the form of incentive and other stock options.
We recognize that the number of businesses that may be available to us
may be limited due to our severely limited financial, managerial and other
resources. We will not restrict our search to any particular industry; but
instead we may investigate businesses of any kind or nature, including, but not
limited to, finance, high technology, manufacturing, service, research and
development, communications, insurance brokerage, transportation and other
businesses. Please take particular note that our business objectives are
extremely general and are not intended to be restrictive upon the discretion of
our management. At the present, we have not identified or chosen an area of
business in which we propose to engage and have not conducted any market studies
with respect to any business or industry. Furthermore, it is impossible at this
time to determine the needs of the business in which we may seek to participate,
and whether such a business would require additional capital or management, have
other business or financial needs, or seek other advantages that we may not be
able to offer. Conversely, we may conduct a business combination with a company
which has no management or capital needs and which is interested in effecting a
business combination with us solely for the purpose of establishing a public
trading market for its securities.
Analysis of Business Prospects
The analysis of potential business combinations will be undertaken by
or under the supervision of management, no member of which is a professional
business analyst. Management may employ accountants, technical experts,
attorneys or other consultants or advisors in connection with its investigation
of a possible business opportunity and in order to supplement the business
experience of management. The selection of any such advisors will be made by
management without any control by stockholders. It is unlikely that management
will have any significant experience in any particular type of business.
It may be anticipated that any business opportunity in which the
Company participates through a business combination with another company will
present certain risks. Many of these risks cannot be adequately identified prior
to the selection of the specific opportunity, and stockholders must, therefore,
depend on the ability of management to identify and evaluate such risks or
obtain the assistance of others to do so (although the funds necessary to obtain
and pay for any such assistance are not presently available). In the case of
many opportunities available to us, it may be anticipated that the promoters
thereof have been unable to develop a going concern or that the business is in
its development stage and has not generated sufficient revenues from its
principal business activity prior to our participation to provide assurance of
its successful operation. In such a case, there is a risk that even after our
participation in the activity the combined enterprise will still be unable to
become a going concern or advance beyond the development stage. The
opportunities available to us may also include new and untested products,
processes or market strategies that may not succeed. If a business combination
were to be entered into by GlobaLock under such circumstances, such risks would
consequently be assumed by GlobaLock and, therefore, our stockholders.
Methods of Business Combination
A business combination entered into by GlobaLock may take the form of a
merger, consolidation or reorganization with another corporation or entity. It
is anticipated that the primary consideration used by GlobaLock to acquire or
combine with another business will be the issuance of additional shares of
Common Stock.
In the event that a business is acquired for our Common Stock, the
owners or the stockholders of the acquired business may receive a number of
shares sufficient to enable them to control GlobaLock, even if the number of
shares is less than a majority of our then issued and outstanding shares.
Accordingly, it is likely that upon consummation of a business combination, the
present management and stockholders of GlobaLock will not be in control of the
company. In addition, a majority of the directors may vote to change the
composition of the board of directors of GlobaLock so that persons associated
with the company with which a business combination is effected control
GlobaLock's board of directors, or a majority or all of our directors may, as a
part of the terms of the acquisition or combination, resign and be replaced by
new directors so that persons associated with the company with which a business
combination is effected control GlobaLock board of directors without a vote of
our stockholders.
It is anticipated that any securities issued in a business combination
transaction would be issued in reliance on exemptions from registration under
applicable federal and state securities laws. In some circumstances, however, as
a negotiated element of the combination, we may agree to register such
securities either at the time the transaction is consummated, under certain
specified conditions, or at specified times thereafter. The issuance of
substantial additional securities and sale of such securities into any trading
market that may develop may have a depressive effect on the prevailing price of
our Common Stock. In addition, the issuance of GlobaLock Common Stock for
purposes of an acquisition may dilute the value of the investment of our
stockholders.
Notwithstanding the fact that GlobaLock may technically be the
acquiring entity, generally accepted accounting principles might require that a
transaction be accounted for as if GlobaLock had been acquired by the other
entity owning or controlling the resulting the business. Therefore, a write-up
in the carrying value of the assets of either company may not be permitted.
The right of our stockholders to approve or disapprove any proposed
transaction will depend upon the form of the transaction chosen by management
and the provisions of applicable state law. Whether or not stockholder approval
is required, management must observe certain fiduciary obligations to GlobaLock
and its stockholders in approving and proceeding with any transaction.
Not An Investment Company or Investment Advisor
We do not intend to engage in the business of investing in securities
or to operate in any manner that would require it to register as an "investment
company" under the Investment Company Act of 1940 (the "Investment Company
Act"). Rule 3a-2 under the Investment Company Act provides that an issuer such
as GlobaLock will be deemed not to be engaged in the business of investing in
securities if, during a period of time not to exceed one year, the issuer has a
bona fide intention to be engaged primarily, as soon as is reasonably possible,
in a business other than investing in securities and such intent is evidenced by
an appropriate resolution of the issuer's board of directors. Our board of
directors has adopted such a resolution. While we would prefer to acquire an
active business within a year, no assurance can be given that it will be able to
do so. If it does not, the safe harbor of Rule 3a-2 will not be available to
GlobaLock, but we believes that we will continue to be exempt from registration
under the Investment Company Act so long as we do not engage primarily in the
business of investing, reinvesting and trading in securities and we maintain our
funds primarily in cash items.
We will not furnish or distribute advise, counsel, publications,
writings, analysis or reports to anyone related to the purchase or sale of any
securities (within the language, meaning and intent of the Investment Advisers
Act of 1940) and will not register as an investment adviser.
Employees
As of August 1, 1999, the Company had one part-time employee.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Background
GlobaLock was incorporated under the laws of the State of Delaware, for
the purpose of engaging in a merger or other business combination with a
presently unidentified operating company. We have no predecessors and have never
engaged in any business activity, other than with respect to organizational
matters. A business combination involving GlobaLock, if any, will likely be
effected through the acquisition of the equity securities or assets of an
existing business, or the merger of GlobaLock with such a business, in a
transaction resulting in a change in control of GlobaLock. It is likely that we
will seek to engage in a business combination with a private enterprise seeking
to develop a public trading market for its securities, although there can be no
assurance that this will be the case.
Plan of Operations
GlobaLock has never engaged in any business activity, except with
respect to its organization, and does not intend to do so until after the
consummation of a business combination. As of June 30, 1999, GlobaLock had
recorded no revenues and had incurred minimal expenses, all of which were
incurred in connection with its organization and this registration statement.
Liquidity and Capital Resources
Since its organization, GlobaLock has satisfied its cash requirements
through sales of Common Stock and cash advances from its current stockholders.
Our uses of cash have been professional fees, printing costs, postage expenses
and similar disbursements relating to the organization of the company and this
registration statement.
At June 30, 1999, we had no cash, assets or other capital resources.
Management expects that its costs of operation, and the costs and
expenses of identifying, investigating and consummating an appropriate business
combination, will be significant. The extent of these costs will depend upon the
amount of time that lapses prior to the completion of a business combination,
the number of business opportunities reviewed by management, the complexity of
the business combination(s) reviewed and the expenses incurred in structuring,
negotiating and consummating a business combination. Certain current
stockholders have agreed, in their discretion, to make advances, if need be, to
fund GlobaLock's immediate cash needs. No such advances have yet been made.
Item 3. Description of Property.
The Company does not own or lease any real or personal property.
Item 4. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth certain information with respect to the
beneficial ownership of GlobaLock's Common Stock as of June 30, 1999, with
respect to each person known by the Company to be the beneficial owner of more
than five percent of our outstanding Common Stock, by each director or person
selected to become a director, by each executive officer and by all directors
and officers as a group. Each person named has sole voting and investment power
with respect to the shares indicated, except as otherwise stated in the notes to
the table. At June 30, 1999, GlobaLock had 2 stockholders of record.
Number
Of Shares Percent
--------- -------
AppleTree Investment Company, Ltd. 1,900,000 95%
69 Athol Street
Douglas, Isle of Man 1M1 1JE
Page One Business Productions, Inc. 100,000 5.0%
All directors and officers as a group - *
(3 persons)
- ---------------
* Less than one percent
<PAGE>
Item 5. Directors, Executive Officers, Promoters and Control Persons.
The following table sets forth certain information concerning our sole
director, executive officers and significant employee:
Name Age Position
---- --- --------
George A. Todt 45 Director, President and Chief Executive Officer
James Walters 45 Vice-President and Treasurer
Betsy Rowbottom 28 Secretary
Daniel J. Zimmerman 42 Business Development Manager
Our director and executive officers devote such time and attention to
the affairs of GlobaLock as is reasonable and necessary. Set forth below is a
description of the background of our director, executive officers and
significant employee.
George A. Todt has been the sole director and our President since the
inception of GlobaLock. Since 1996, Mr. Todt has been a managing member of
PageOne Business Productions, LLC, a Delaware limited liability company. From
1990 to 1995, Mr. Todt was the chief executive officer of REPCO, Inc., a
worldwide designer and builder of environmental facilities.
James Walters has been the Vice-President and the Treasurer of
GlobaLock since its inception. For more than 20 years, Mr. Walters has been
engaged as a certified public accountant with the Los Angeles, California-based
firm of Kellogg & Andelson.
Betsy Rowbottom joined GlobaLock as Secretary in June 1999 from PageOne
Business Productions, LLC where she began working in 1997 and became Vice
President in March 1999. From 1994 to 1997, Ms. Rowbottom served as a talent
agent at HSI Productions, a Chicago, Illinois-based video production company.
Daniel J. Zimmerman was hired as the Business Development Manager of
the Company in August, 1999. In 1998, Mr. Zimmerman began working for PageOne
Business Productions, LLC. For approximately five years prior thereto, he served
as the principal executive officer of a camp and organic farm for children
called River Oaks Ranch.
Our board of directors currently consists of one member, who serves in
such capacity for a one-year term or until his successor has been elected and
qualified, subject to earlier resignation, removal or death. The number of
directors constituting the board of directors may be increased or decreased (but
not below the minimum number required by applicable law) from time to time by
resolution of the board of directors. GlobaLock's officers serve at the
discretion of the board of directors, subject to any effective contractual
arrangements.
<PAGE>
Item 6. Executive Compensation.
Consistent with our present policy, no director or executive officer of
GlobaLock receives compensation for services rendered to the company. However,
such persons are entitled to be reimbursed for expenses incurred by them in
pursuit of GlobaLock's business objectives.
Item 7. Certain Relationships and Related Transactions.
In March 1999, Globalock issued 100,000 shares to PageOne Business
Productions, LLC, of which Mr. Todt is a managing member and Ms. Rowbottom is
the Vice President.
Item 8. Description of Securities.
Authorized and Outstanding Capital Stock
GlobaLock's Restated Certificate of Incorporation provides for an
authorized capital of 10,100,000 shares, $0.001 par value per share, of which
10,000,000 are classified as Common Stock and 100,000 are classified as
Preferred Stock. As of June 30, 1999, there were 2,000,000 shares of Common
Stock and no shares of Preferred Stock issued and outstanding. The following
summary description of the Common Stock of the Company is qualified in its
entirety by reference to the Certificates.
Common Stock
The holders of Common Stock are entitled to cast one vote for each
share of record on all matters to be voted on by shareholders, including the
election of directors. Stockholders are not entitled to vote cumulatively with
respect to the election of directors. The holders of Common Stock are entitled
to receive dividends when and if declared by the board of directors out of
legally available funds. In the event of liquidation, dissolution or winding up
of the affairs of GlobaLock, the holders of the Common Stock are entitled to
share ratably in all remaining assets which are available for distribution to
them after payment of liabilities and after provision has been made for each
class of stock, if any, having preference over the Common Stock. Holders of
shares of Common Stock, as such, have no conversion rights, and there are no
redemption provisions applicable to the Common Stock. However, the Certificate
grants the holders of Common Stock pre-emptive to purchase Common Stock.
All of the outstanding shares of Common Stock are validly issued, fully
paid and non-assessable.
Transfer Agent and Registrar
The Company has appointed American Securities Transfer and Trust as the
transfer agent and registrar of the Common Stock.
PART II
Item 1. Market Price of Dividends on the Registrant's Common Equity and Other
Shareholder Matters.
GlobaLock has not declared or paid any cash dividends on its Common
Stock since its inception, and the board of directors presently intends to
retain all of its earnings, if any, for the development of our business. The
declaration and payment of cash dividends in the future will be at the
discretion of our board of directors and will depend upon a number of factors,
including, among others, future earnings, operations, capital requirements, the
general financial condition of GlobaLock and such other factors as the board of
directors may deem relevant.
Item 2. Legal Proceedings.
GlobaLock is not a party to any litigation and, to our knowledge, no
such proceedings are threatened.
Item 3. Changes in Disagreements With Accountants.
Since its inception, GlobaLock has not dismissed its independent
accountant, nor has its independent accountant resigned (or declined to stand
for re-election).
Item 4. Recent Sales of Unregistered Securities.
In October, 1998, GlobaLock issued a total of 1,000,000 shares of
Common Stock for an aggregate purchase price of $10,000. The purchaser of such
shares was a sophisticated investor and had a pre-existing relationship with
GlobaLock. The offering was conducted in reliance on Section 4(2) of the
Securities Act of 1933, as amended.
On March 15, 1999, GlobaLock issued 900,000 and 100,000 shares of
Common Stock for an aggregate purchase price of $1,000. The Purchasers of such
shares were sophisticated investors, each of which had a pre-existing
relationship with GlobaLock. The offering was conducted in reliance on Section
4(2) of the Securities Act of 1933, as amended.
Item 5. Indemnification of Directors and Officers.
Section 145 of Delaware Corporation Law provides that a corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding by reason of
the fact that he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with such action, suit or proceeding if
the person acted in good faith and in a manner the person reasonably believed to
be in or not opposed to the best interests of the corporation and, with respect
to any criminal action or proceeding, had no reasonable cause to believe such
person's conduct was unlawful, except that, in the case of an action or suit by
or in the right of the corporation, the corporation may not indemnify such
persons against judgments and fines and no person shall be indemnified as to any
claim, issue or matter as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance of the person's duty to
the corporation, unless and only to the extent that the court in which the
action or suit was brought determines upon application that such person is
fairly and reasonably entitled to indemnity for proper expenses.
<PAGE>
PART F/S
- --------------------------------------------------------------------------------
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
CONTENTS
- --------------------------------------------------------------------------------
PAGE 1 - INDEPENDENT AUDITORS' REPORT
PAGE 2 - BALANCE SHEET AS OF OCTOBER 31, 1998
PAGE 3 - STATEMENT OF OPERATIONS FOR THE PERIOD
FROM AUGUST 5, 1998 (INCEPTION) TO
OCTOBER 31, 1998
PAGE 4 - STATEMENT OF CHANGES IN STOCKHOLDER'S
EQUITY FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO OCTOBER 31, 1998
PAGE 5 - STATEMENT OF CASH FLOW FOR THE PERIOD
FROM AUGUST 5, 1998 (INCEPTION) TO
OCTOBER 31, 1998
PAGE 6 - 7 - NOTES TO FINANCIAL STATEMENTS AS OF
OCTOBER 31, 1998
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of:
GlobaLock Corporation
We have audited the accompanying balance sheet of GlobaLock Corporation (a
development stage company) as of October 31, 1998 and the related statements of
operations, changes in stockholder's equity and cash flows for the period from
August 5, 1998 (inception) to October 31, 1998. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statements presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly in all
material respects, the financial position of GlobaLock Corporation (a
development stage company) as of October 31, 1998, and the results of its
operations and its cash flows for the period from August 5, 1998 (inception) to
October 31, 1998, in conformity with generally accepted accounting principles.
/s/ Weinberg & Company, P.A.
WEINBERG & COMPANY, P.A.
Boca Raton, Florida
March 15, 1999
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AS OF OCTOBER 31, 1998
ASSETS
Cash $ 1,807
---------
TOTAL ASSETS $ 1,807
- ------------ =========
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES
Accounts payable $ 215
---------
Total Liabilities 215
STOCKHOLDER'S EQUITY
Preferred Stock, $0.01 par value,
100,000 shares authorized, none
issued and outstanding --
Common Stock, $0.01 par value,
10,000,000 shares authorized,
1,000,000 shares issued and
outstanding 10,000
Deficit accumulated during development
stage (8,408)
Total Stockholder's Equity 1,592
TOTAL LIABILITIES AND STOCKHOLDER'S
EQUITY $ 1,807
=========
See accompanying notes to financial statements.
2
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO OCTOBER 31, 1998
REVENUE $ --
EXPENSES
Consulting expense 6,258
Transfer agent fee 150
Bad debt expense 2,000
----------
Total expense 8,408
----------
NET LOSS (8,408)
==========
Weighted average number of
shares outstanding during
the period 126,524
-----------
Net loss per common share
and equivalents $ ( 0.0665)
==========
See accompanying notes to financial statements.
3
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN
STOCKHOLDER'S EQUITY
FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO OCTOBER 31, 1998
Deficit
Accumulated
Common Stock During Deve-
Shares Amount lopment Stage Total
--------- ------- ------------- --------
Common stock issuance 1,000,000 $ 10,000 $ -- $ 10,000
Net loss for the period
from August 5, 1998
(Inception) to October
31, 1998 -- -- (8,408) (8,408)
--------- -------- ----------- --------
BALANCE AT OCTOBER 31,
1998 1,000,000 $ 10,000 $ (8,408) $ 1,592
========= ======== =========== =========
See accompanying notes to financial statements.
4
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO OCTOBER 31, 1998
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss $ (8,408)
Adjustments to reconcile net loss
to net cash (used in) provided by
operating activities:
Bad debt expense 2,000
Changes in assets and liabilities:
Increase (decrease) in:
Accounts payable 215
----------
Net cash used in operating activities (6,193)
----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Advances to unrelated party (2,000)
----------
Net cash used in investing activities (2,000)
----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock 10,000
----------
Net cash provided by financing activities 10,000
----------
INCREASE IN CASH AND CASH EQUIVALENTS 1,807
CASH AND CASH EQUIVALENTS - BEGINNING
OF PERIOD --
----------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 1,807
===========
See accompanying notes to financial statements.
5
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF OCTOBER 31, 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Organization and Business Operations
Globalock Corporation (a development stage company) was incorporated
under the laws of Delaware on August 5, 1998 for the purpose of
effecting a merger or other business combination with a domestic or
foreign business.
B. Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company considers all
highly liquid investments purchased with an original maturity of three
months or less to be cash equivalents.
C. Use of Estimates
The preparation of the financial statements in conformity with
generally accepted accounting principles 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 the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates.
D. Per Share Data
Net loss per common share for the period ended October 31, 1998 is
computed by dividing net loss by the weighted average common shares
outstanding during the period as defined by Financial Accounting
Standards, No. 128, "Earnings per Share".
E. Income Taxes
The Company accounts for income taxes under Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109).
SFAS 109 is an asset and liability approach that requires the
recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been recognized in the
Company's financial statements or tax returns. In estimating future tax
consequences, SFAS 109 generally considers all expected future events
other than enactments of changes in the law or rates.
At October 31, 1998, the Company had net operating loss carryforwards
of approximately $8,400 which expires in the year 2013. The deferred
tax asset created by this net operating loss has been fully offset by a
valuation allowance.
6
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF OCTOBER 31, 1998
NOTE 2 - ADVANCES TO UNRELATED PARTY
In anticipation of a potential acquisition which was subsequently
cancelled, the Company advanced funds to pay a retainer for auditing
services on behalf of the potential acquiree. As a result of the
cancellation of the acquisition, the $2,000 receivable was written off
and is included in the results of operations as bad debt expense for
the period ended October 31, 1998.
NOTE 3 - STOCKHOLDER'S EQUITY
A. Preferred Stock
The Company is authorized to issue 100,000 shares of preferred stock at
$.01 par value, with such designations, preferences, limitations and
relative rights as may be determined from time to time by the Board of
Directors.
B. Common Stock
The Company is authorized to issue 10,000,000 shares of common stock at
$.01 par value. The Company issued 1,000,000 shares to Appletree
Investment Company, Ltd.
NOTE 4 - SUBSEQUENT EVENTS
(A) On March 15, 1999 the Company issued 900,000 and 100,000
shares to Appletree Investment Company, Ltd. and Page One
Business Productions, Inc., respectively for cash.
(B) Management is in the process of filing a restated certificate
of incorporation with the state of Delaware which will change
the par value of the common and preferred shares from $.01 per
share to $.001 per share.
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
CONTENTS
- --------------------------------------------------------------------------------
PAGE 1 - ACCOUNTANTS' REVIEW REPORT
PAGE 2 - BALANCE SHEET AS OF APRIL 30, 1999
PAGE 3 - STATEMENTS OF OPERATIONS FOR FOUR MONTHS
ENDED APRIL 30, 1999 AND FOR THE PERIOD
FROM AUGUST 5, 1998 (INCEPTION) TO
APRIL 30, 1999
PAGE 4 - STATEMENT OF CHANGES IN STOCKHOLDERS'
DEFICIENCY FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO APRIL 30, 1999
PAGE 5 - STATEMENTS OF CASH FLOW FOR FOUR MONTHS ENDED
APRIL 30, 1999 AND FOR THE PERIOD
FROM AUGUST 5, 1998 (INCEPTION) TO
APRIL 30, 1999
PAGE 6 - 7 - NOTES TO FINANCIAL STATEMENTS AS OF
APRIL 30, 1999
<PAGE>
ACCOUNTANTS' REVIEW REPORT
To the Board of Directors of:
GlobaLock Corporation
We have reviewed the accompanying balance sheet of GlobaLock Corporation as of
April 30, 1999 and the related statements of operations, changes in
stockholders' deficiency and cash flows for the four months then ended and for
the period from August 5, 1998 (inception) to April 30, 1999, in accordance with
Statements on Standards for Accounting and Review Services issued by the
American Institute of Certified Public Accountants. All information included in
these financial statements is the representation of the management of GlobaLock
Corporation.
A review consists principally of inquiries of company personnel and analytical
procedures applied to financial data. It is substantially less in scope than an
audit in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements in order for them to be in
conformity with generally accepted accounting principles.
/s/ Weingberg & Company, P.A.
WEINBERG & COMPANY, P.A.
Boca Raton, Florida
July 15, 1999
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AS OF APRIL 30, 1999
ASSETS
Cash $ 770
---------
TOTAL ASSETS $ 770
- ------------ =========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
LIABILITIES
Accounts payable $ 4,515
---------
Total liabilities 4,515
---------
STOCKHOLDERS' DEFICIENCY
Preferred Stock, $.001
par value, 100,000
shares authorized, none
issued and outstanding --
Common Stock, $.001 par
value, 10 million shares
authorized, 2,000,000 issued
and outstanding 2,000
Capital in excess of par 9,000
Accumulated deficit during
development stage (14,745)
--------
Total Stockholders' Deficiency (3,745)
--------
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIENCY $ 770
=========
See accompanying notes to financial statements.
2
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
FOR THE FOUR MONTHS ENDED APRIL 30, 1999
AND FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO APRIL 30, 1999
CUMULATIVE FROM
AUGUST 5, 1998 FOUR MONTHS
(INCEPTION) TO ENDED
APRIL 30, 1999 APRIL 30, 1999
-------------- --------------
Income $ -- $ --
-------------- ------------
Expenses
Accounting fees 4,800 4,300
Bad debt expense 2,000 --
Bank service fees 74 44
Consulting expense 6,258 --
Insurance 230 230
Transfer agent fees 1,383 --
------------- ------------
Total expenses 14,745 4,574
------------- ------------
NET LOSS $ (14,745) $ (4,574)
============= =============
Weighted average number
of shares outstanding
during the period 716,446 1,000,000
============ =============
Net loss per common share
and equivalents $ (.0206) $ (.0046)
============ =============
See accompanying notes to financial statements.
3
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIENCY
FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO APRIL 30, 1999
<TABLE>
<CAPTION>
DEFICIT
ACCUMULATED
ADDITIONAL DURING
COMMON STOCK PAID-IN DEVELOPMENT
SHARES AMOUNT CAPITAL STAGE TOTAL
------ ------ ---------- ----------- -----
<S> <C> <C> <C> <C> <C>
Common stock issuance 1,000,000 $ 1,000 $ 9,000 $ - $ 10,000
Net loss for the year ended
December 31, 1998 -- -- -- (10,171) (10,171)
--------- -------- ------- --------- ----------
Balance at December 31, 1998 1,000,000 1,000 9,000 (10,171) (171)
Common stock issuance 1,000,000 1,000 -- -- 1,000
Net loss for the four months
ended April 30, 1999 -- -- -- (4,574) (4,574)
---------- -------- ------- ---------- ----------
BALANCE, APRIL 30, 1999 2,000,000 $ 2,000 $ 9,000 $ (14,745) $ (3,745)
========== ======== ======= ========== ==========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
FOR THE FOUR MONTHS ENDED APRIL 30, 1999
AND FOR THE PERIOD FROM AUGUST 5, 1998
(INCEPTION) TO APRIL 30, 1999
CUMULATIVE FROM
AUGUST 5, 1998 FOUR MONTHS
(INCEPTION) TO ENDED
APRIL 30, 1999 APRIL 30, 1999
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net loss $ (14,745) $ (4,574)
Adjustments to
reconcile net loss
to net cash used
by operating activities:
Increase in accounts payable 4,515 4,300
------------- -------------
Net cash used by
operating activities (10,230) (274)
------------- -------------
CASH FLOWS FROM INVESTING
ACTIVITIES -- --
------------- -------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from issuance
of common stock 11,000 1,000
------------- -------------
Net cash provided by
financing activities 11,000 1,000
------------- -------------
INCREASE IN CASH
AND CASH EQUIVALENTS 770 726
CASH AND CASH
EQUIVALENTS - BEGINNING
OF PERIOD -- 44
------------- -------------
CASH AND CASH EQUIVALENTS
- END OF PERIOD $ 770 $ 770
============= =============
See accompanying notes to financial statements.
5
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF APRIL 30, 1999
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ----------------------------------------------------
A. Organization and Business Operations
Globalock Corporation (a development stage company) was incorporated in
Delaware on August 5, 1998 for the purpose of effecting a merger or
other business combination with a domestic or foreign business.
B. Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company considers all
highly liquid investments purchased with an original maturity of three
months or less to be cash equivalents.
C. Use of Estimates
The preparation of the financial statements in conformity with
generally accepted accounting principles 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 the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates.
(D) Per Share Data
Net loss per common share for the four months ended April 30, 1999 and
for the period from August 5, 1998 (inception) to April 30, 1999, is
computed by dividing net loss by the weighted average common shares
outstanding during the period as defined by Financial Accounting
Standards, No. 128, "Earnings per Share".
E. Income Taxes
The Company accounts for income taxes under Statement of Financial
Accounting Standards No 109, "Accounting for Income Taxes" (SFAS109).
SFAS 109 is an asset and liability approach that requires the
recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been recognized in the
6
<PAGE>
GLOBALOCK CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS OF APRIL 30, 1999
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONT'D)
- --------------------------------------------------------------
E. Income Taxes - (CONT'D)
Company's financial statements or tax returns. In estimating future tax
consequences, SFAS 109 generally considers all expected future events
other than enactments of changes in the law or rates.
At April 30, 1999, the company had net operating loss carryforwards of
approximately $10,400 which expires in the year 2013. The deferred tax
asset created by this net operating loss has been fully offset by a
valuation allowance.
NOTE 2 - ADVANCES TO UNRELATED PARTY
- ------------------------------------
In anticipation of a potential acquisition which was subsequently
canceled, the Company advanced funds to pay a retainer for auditing
services on behalf of the potential acquiree. As a result of the
cancellation of the acquisition, the $2,000 receivable was written off
in 1998 and is included in the cumulative results of operations as bad
debt expense.
NOTE 3 - STOCKHOLDERS' EQUITY
- -----------------------------
A. Preferred Stock
The Company is authorized to issue 100,000 shares of preferred stock at
$.001 par value, with such designations, preferences, limitations and
relative rights as may be determined from time to time by the Board of
Directors.
B. Common Stock
The Company is authorized to issue 10,000,000 shares of common stock at
$.001 par value. The Company issued 1,900,000 and 100,000 shares to
Appletree Investment Company, Ltd. and Page One Business Productions,
respectively.
7
<PAGE>
PART III
Item 1. Index to Exhibits.
Description Page
- ----------- ----
3.1 Restated Certificate of Incorporation
3.2 Bylaws
4.1 Specimen of common stock certificate
10.1 Employment Agreement Between GlobaLock Corporation
and Daniel Zimmerman
23.1 Consent of Weinberg & Company, P.A.
27.1 Financial Data Schedule
99.1 Statement Regarding Risks and Uncertainties
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
Date: August 4, 1999
GlobaLock Corporation
By: /s/ George A. Todt
----------------------------------------
George A. Todt, President
(principal executive officer)
EXHIBIT 3.1
RESTATED CERTIFICATE OF INCORPORATION
OF
GLOBALOCK CORPORATION
UNDER SECTIONS 242 & 245
OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
We, George Todt, President, and Mary Elizabeth Rowbottom, Secretary, of
GLOBALOCK CORPORATION, do hereby certify under the seal of said corporation as
follows:
1. That the name of the corporation is GLOBALOCK CORPORATION.
2. That the Certificate of Incorporation of the corporation was filed
by the Secretary of State of the State of Delaware in Dover, Delaware, on the
5th day of August, 1998.
3. That the amendment to the Certificate of Incorporation effected by
this Certificate, among others, is as follows:
To amend Article FOURTH thereof by decreasing the par value per share.
4. That the amendment and the restatement of the Certificate of
Incorporation have been duly adopted in accordance with the requirements of
Sections 242 and 245 of the General Corporation Law of the State of Delaware.
5. That the text of the Certificate of Incorporation of said GLOBALOCK
CORPORATION, is hereby amended and restated by this Certificate, to read in
full, as follows:
<PAGE>
CERTIFICATE OF INCORPORATION
OF
GLOBALOCK CORPORATION
FIRST: The name of the corporation is GLOBALOCK CORPORATION
(hereinafter referred to as the "Corporation")-
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 686 North Dupont Boulevard, #302, City of Milford, County
of Kent. The name of the registered agent of the Corporation at that address is
Corporate Creations Enterprises, Inc.
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware (the "Delaware General Corporation Law").
FOURTH: (a) The Corporation shall have the authority to issue
10,000,000 shares of common stock, par value $0.00 1 per share. In addition, the
Corporation shall have the authority to issue 100,000 share of preferred stock,
par value $0.001 per share, which may be divided into series and with the
preferences, limitations and relative rights determined by the Board of
Directors. The Corporation elects to have preemptive rights.
(i) The designation of such series;
(ii) The dividend rate of such series, the conditions and dates upon
which such dividends shall be payable, the relation which such dividends shall
bear to the dividends payable on any other class or classes or series of the
Corporation's capital stock and whether such dividends shall be cumulative or
non-cumulative;
(iii) Whether the shares of such series shall be subject to redemption
for cash, property or rights, including securities of any other corporation, by
the Corporation or upon the happening of a specified event and, if made subject
to any such redemption, the times or events, prices, rates, adjustments and
other terms and conditions of such redemptions;
(iv) The terms and amount of any sinking fund provided for the purchase
or redemption of the shares of such series;
(v) Whether or not the shares of such series shall be convertible into,
or exchangeable for, at the option of either the holder or the Corporation or
upon the happening of a specified event, shares of any other class or classes or
of any other series of the same class of the Corporation's capital stock and, if
provision be made for conversion or exchange, the times or events, prices,
rates, adjustments and other terms and conditions of such conversions or
exchanges;
(vi) The restrictions, if any, on the issue or reissue of any
additional Preferred Stock;
(vii) The rights of the holders of the shares of such series upon the
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation; and
(viii) The provisions as to voting, optional and/or other special
rights and preferences, if any, including, without limitation, the right to
elect one or more Directors.
(c) Common Stock. Except as otherwise provided by the Delaware General
Corporation Law or this Certificate of Incorporation (the "Certificate"), the
holders of Common Stock (i) subject to the rights of holders of any series of
Preferred Stock, shall share ratably in all dividends payable in cash, stock or
otherwise and other distributions, whether in respect of liquidation or
dissolution (voluntary or involuntary) or otherwise and (5) are subject to all
the powers, rights, privileges, preferences and priorities of any series of
Preferred Stock as provided herein or in any resolution or resolutions adopted
by the Board of Directors pursuant to authority expressly vested in it by the
provisions of Section (b) of this ARTICLE FOURTH.
(i) The Common Stock shall not be convertible into, or exchangeable
for, shares of any other class or classes or of any other series of the same
class of the Corporation's capital stock.
(ii) No holder of Common Stock shall have any preemptive, subscription,
redemption, conversion or sinking fund rights with respect to the Common Stock,
or to any obligations convertible (directly or indirectly) into stock of the
Corporation whether now or hereafter authorized.
(iii) Except as otherwise provided by the Delaware General Corporation
Law or this Certificate, and subject to the rights of holders of any series of
Preferred Stock, all of the voting power of the stockholders of the Corporation
shall be vested in the holders of the Common Stock, and each holder of Common
Stock shall have one vote for each share held by such holder on all matters
voted upon by the stockholders of the Corporation.
FIFTH: The Corporation is to have perpetual existence.
SIXTH: In furtherance and not in limitation of the powers conferred by
the Delaware General Corporation Law, the Board of Directors of the Corporation
is expressly authorized to make, alter, amend, change, add to or repeal the
By-laws of the Corporation by the affirmative vote of a majority of the total
number of Directors then in office. Any alteration or repeal of the By-laws of
the Corporation by the stockholders of the Corporation shall require the
affirmative vote of at least a majority of the voting power of the then
outstanding shares of capital stock of the Corporation entitled to vote on such
alteration or repeal, subject to ARTICLE NINTH hereof and applicable provisions
of the Corporation's By-laws.
SEVENTH: (a) Stockholder Action. Election of Directors need not be by
written ballot unless the By-laws of the Corporation so provide. Subject to any
rights of holders of any series of Preferred Stock, from and after the date on
which the Common Stock of the Corporation is registered pursuant to the Exchange
Act, (i) any action required or permitted to be taken by the stockholders of the
Corporation must be effected at an annual or special meeting of stockholders of
the Corporation and may not be effected in lieu thereof by any consent in
writing by such stockholders, (ii) special meetings of stockholders of the
Corporation may be called only by either the Board of Directors pursuant to a
resolution adopted by the affirmative vote of the majority of the total number
of Directors then in office or by the chief executive officer of the
Corporation, and (iii) advance notice of stockholder nominations of persons for
election to the Board of Directors of the Corporation and of business to be
brought before any annual meeting of the stockholders by the stockholders of the
Corporation shall be given in the manner provided in the By-laws of the
Corporation.
(b) Number of Directors and Term of Office. Subject to any rights of
holders of any series of Preferred Stock to elect additional Directors under
specified circumstances, the number of Directors which shall constitute the
Board of Directors of the Corporation shall be fixed from time to time in the
manner set forth in the By-laws of the Corporation.
(c) Removal and Resignation. No Director may be removed from office
without cause and without the affirmative vote of the holders of a majority of
the voting power of the then outstanding shares of capital stock of the
Corporation entitled to vote generally in the election of Directors voting
together as a single class; provided, however, that if the holders of any class
or series of capital stock are entitled by the provisions of this Certificate
(it being understood that any references to this Certificate shall include any
duly authorized certificate of designation) to elect one or more Directors, such
Director or Directors so elected may be removed without cause only by the vote
of the holders of a majority of the outstanding shares of that class or series
entitled to vote. Any Director may resign at any time upon written notice to the
Corporation.
(d) Vacancies and Newly Created Directorships. Subject to any rights of
holders of any series of Preferred Stock to fill such newly created
Directorships or vacancies, any newly created Directorships resulting from any
increase in the authorized number of Directors and any vacancies in the Board of
Directors resulting from death, resignation, disqualification or removal from
office for cause shall, unless otherwise provided by law or by resolution
approved by the affirmative vote of a majority of the total number of Directors
then in office, be filled only by resolution approved by the affirmative vote of
a majority of the total number of Directors then in office. Any Director so
chosen shall hold office until the next election of the class for which such
Director shall have been chosen, and until his successor shall have been duly
elected and qualified, unless he shall resign, die, become disqualified or be
removed for cause.
EIGHTH: (a) Dividends. The Board of Directors shall have authority from
time to time to set apart out of any assets of the Corporation otherwise
available for dividends a reserve or reserves as working capital or for any
other purpose or purposes, and to abolish or add to any such reserve or reserves
from time to time as said Board may deem to be in the interest of the
Corporation; and said Board shall likewise have power to determine in its
discretion, except as herein otherwise provided, what part of the assets of the
Corporation available for dividends in excess of such reserve or reserves shall
be declared in dividends and paid to the stockholders of the Corporation.
(b) Issuance of Stock. The shares of all classes of stock of the
Corporation may be issued by the Corporation from time to time for such
consideration as from time to time may be fixed by the Board of Directors of the
Corporation, provided that shares of stock having a par value shall not be
issued for a consideration less than such par value, as determined by the Board.
At any time, or from time to time, the Corporation may grant rights or options
to purchase from the Corporation any shares of its stock of any class or classes
to run for such period of time, for such consideration, upon such terms and
conditions, and in such form as the Board of Directors may determine. The Board
of Directors shall have authority, as provided by law, to determine that only a
part of the consideration which shall be received by the Corporation for the
shares of its stock which it shall issue from time to time, shall be capital,
provided, however, that, if all the shares issued shall be shares having a par
value, the amount of the pan of such consideration so determined to be capital
shall be equal to the aggregate par value of such shares. The excess, if any, at
any time, of the total net assets of the Corporation over the amount so
determined to be capital, as aforesaid, shall be surplus, All classes of stock
of the Corporation shall be and remain at all times nonassessable.
The Board of Directors is hereby expressly authorized, in its
discretion, in connection with the issuance of any obligations or stock of the
Corporation (but without intending hereby to limit its general power so to do in
other cases), to grant rights or options to purchase stock of the Corporation of
any class upon such terms and during such period as the Board of Directors shall
determine, and to cause such rights to be evidenced by such warrants or other
instruments as it may deem advisable.
(c) Inspection of Books and Records. The Board of Directors shall have
power from time to time to determine to what extent and at what times and places
and under what conditions and regulations the accounts and books of the
Corporation, or any of them, shall be open to the inspection of the
stockholders; and no stockholder shall have any right to inspect any account or
book or document of the Corporation, except as conferred by the laws of the
State of Delaware, unless and until authorized so to do by resolution of the
Board of Directors or of the stockholders of the Corporation.
(d) Location of Meetings, Books and Records. Except as otherwise
provided in the By-laws, the stockholders of the Corporation and the Board of
Directors may hold their meetings and have an office or offices outside of the
State of Delaware and, subject to the provisions of the laws of said State, may
keep the books of the Corporation outside of said State at such places as may,
from time to time, be designated by the Board of Directors.
NINTH: The Corporation reserves the right to amend, alter, change or
repeat any provision contained in this Certificate in the manner now or
hereinafter prescribed herein and by the laws of the State of Delaware, and all
rights conferred upon stockholders herein are granted subject to this
reservation. Notwithstanding anything contained in this Certificate to the
contrary, Sections (a), (b) and (c) of ARTICLE FOURTH, ARTICLE TENTH, ARTICLE
SEVENTH, and this ARTICLE NINTH of this Certificate shall not be altered,
amended or repeated and no provision inconsistent therewith shall be adopted
without the affirmative vote of the holders of at least a majority of the voting
power of the then outstanding shares of capital stock of the Corporation
entitled to vote on such alteration, amendment or repeal, voting together as a
single class.
TENTH: (a) Limitation of Liability.
(i) To the fullest extent permitted by the Delaware General Corporation
Law as it now exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Corporation to
provide broader indemnification rights than permitted prior thereto), and except
as otherwise provided in the Corporation's By-laws, no Director of the
Corporation shall be liable to the Corporation or its stockholders for monetary
damages arising from a breach of fiduciary duty owed to the Corporation or its
stockholders.
(ii) Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any right or
protection of a Director of the Corporation existing at the time of such repeal
or modification.
(b) Right to Indemnification. Each person who was or is made a party or
is threatened to be made a party to or is otherwise involved (including
involvement as a witness) in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (a "proceeding"), by reason of the
fact that he or she is or was a Director or officer of the Corporation or, while
a Director or officer of the Corporation, is or was serving at the request of
the Corporation as a Director, officer, employee or agent of another corporation
or of a partnership, joint venture, trust or other enterprise, including service
with respect to an employee benefit plan (an "indemnitee"), whether the basis of
such proceeding is alleged action in an official capacity as a Director or
officer or in any other capacity while serving as a Director or officer, shall
be indemnified and held harmless by the Corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than permitted prior thereto), against all expense, liability and loss
(including attorneys' fees, judgments, fines, excise taxes or penalties and
amounts paid in settlement) reasonably incurred or suffered by such indemnitee
in connection therewith and such indemnification shall continue as to an
indemnitee who has ceased to be a Director, officer, employee or agent and shall
inure to the benefit of the indemnitee's heirs, executors and administrators;
provided, however, that, except as provided in Section (c) of this ARTICLE TENTH
with respect to proceedings to enforce rights to indemnification, the
Corporation shall indemnify any such indemnitee in connection with a proceeding
(or part thereof) initiated by such indemnitee only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Corporation. The right
to indemnification conferred in this Section (b) of this ARTICLE TENTH shall be
a contract right and shall include the obligation of the Corporation to pay the
expenses incurred in defending any such proceeding in advance of its final
disposition (an "advance of expenses"); provided, however, that, if and to the
extent that the Delaware General Corporation Law requires, an advance of
expenses incurred by an indemnitee in his or her capacity as a Director or
officer (and not in any other capacity in which service was or is rendered by
such indemnitee, including, without limitation, service to an employee benefit
plan) shall be made only upon delivery to the Corporation of an undertaking (an
"undertaking"), by or on behalf of such indemnitee, to repay all amounts so
advanced if it shall ultimately be determined by final judicial decision from
which there is no further right to appeal (a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section (b) or otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees and agents of the Corporation
with the same or lesser scope and effect as the foregoing indemnification of
Directors and officers.
(c) Procedure for Indemnification. Any indemnification of a Director or
officer of the Corporation or advance of expenses under Section (b) of this
ARTICLE TENTH shall be made promptly, and in any event within forty-five (45)
days (or, in the case of an advance of expenses, twenty (20) days), upon the
written request of the Director or officer. If a determination by the
Corporation that the Director or officer is entitled to indemnification pursuant
to this ARTICLE TENTH is required, and the Corporation fails to respond within
sixty (60) days to a written request for indemnity, the Corporation shall be
deemed to have approved the request. If the Corporation denies a written request
for indemnification or advance of expenses, in whole or in part, or if payment
in full pursuant to such request is not made within forty-five (45) days (or, in
the case of an advance of expenses, twenty (20) days), the right to
indemnification or advances as granted by this ARTICLE TENTH shall be
enforceable by the Director or officer in any court of competent jurisdiction.
Such person's costs and expenses incurred in connection with successfully
establishing his or her right to indemnification, in whole or in part, in any
such action shall also be indemnified by the Corporation. It shall be a defense
to any such action (other than an action brought to enforce a claim for the
advance of expenses where the undertaking required pursuant to Section (b) of
this ARTICLE TENTH, if any, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law for the Corporation to indemnify the
claimant for the amount claimed, but the burden of such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General Corporation
Law, nor an actual determination by the Corporation (including its Board of
Directors, independent legal counsel or its stockholders) that the claimant has
not met such applicable standard of conduct, shall be a defense to the action or
create a presumption that the claimant has not met the applicable standard of
conduct. The procedure for indemnification of other employees and agents for
whom indemnification is provided pursuant to Section (b) of this ARTICLE TENTH
shall be the same procedure set forth in this Section (c) for Directors or
officers, unless otherwise set forth in the action of the Board of Directors
providing indemnification for such employee or agent.
(d) Insurance. The Corporation may purchase and maintain insurance on
its own behalf and on behalf of any person who is or was a Director, officer,
employee or agent of the Corporation or was serving at the request of the
Corporation as a Director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any expense,
liability or loss asserted against him or her and incurred by him or her in any
such capacity, whether or not the Corporation would have the power to indemnify
such person against such expense, liability or loss under the Delaware General
Corporation Law.
(e) Service for Subsidiaries. Any person serving as a Director,
officer, employee or agent of another corporation, partnership, limited
liability company, joint venture or other enterprise, at least 50% of whose
equity interests are owned by the Corporation (a "subsidiary" for this ARTICLE
TENTH) shall be conclusively presumed to be serving in such capacity at the
request of the Corporation.
(f) Reliance. Persons who after the date of the adoption of this
provision become or remain Directors or officers of the Corporation or who,
while a Director or officer of the Corporation, become or remain a Director,
officer, employee or agent of a subsidiary, shall be conclusively presumed to
have relied on the rights to indemnity, advance of expenses and other rights
contained in this ARTICLE TENTH in entering into or continuing such service. The
rights to indemnification and to the advance of expenses conferred in this
ARTICLE TENTH shall apply to claims made against an indemnitee arising out of
acts or omissions which occurred or occur both prior and subsequent to the
adoption hereof
(g) Non-Exclusivity of Rights. The rights to indemnification and to the
advance of expenses conferred in this ARTICLE TENTH shall not be exclusive of
any other right which any person may have or hereafter acquire under this
Certificate or under any statute, bylaw, agreement, vote of stockholders or
disinterested Directors or otherwise.
(h) Merger or Consolidation. For purposes of this ARTICLE TENTH,
references to the "Corporation" shall include, in addition to the resulting
Corporation, any constituent Corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
Directors, officers and employees or agents, so that any person who is or was a
Director, officer, employee or agent of such constituent Corporation, or is or
was serving at the request of such constituent Corporation as a Director,
officer, employee or agent of another Corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under this ARTICLE
TENTH with respect to the resulting or surviving Corporation as he or she would
have with respect to such constituent Corporation if its separate existence had
continued.
ELEVENTH: The Corporation expressly elects not to be governed by
Section 203 of the Delaware General Corporation Law with respect to business
combinations with interested stockholders.
IN WITNESS WHEREOF, the undersigned hereby executed this instrument and
affirms, under penalty of perjury, that this instrument is the act and deed of
the undersigned and that the facts stated herein are true, and accordingly have
hereunto set our hands this 1st day of July, 1999.
/s/ George Todt
-----------------------------------
George Todt, President
/s/ Mary Elizabeth Rowbottom
-----------------------------------
Mary Elizabeth Rowbottom, Secretary
EXHIBIT 3.2
BYLAWS
OF
GLOBAL LOCK CORPORATION
ARTICLE I. DIRECTORS
Section 1. Function. All corporate powers shall be exercised by or under the
authority of the Board of Directors. The business and affairs of the Corporation
shall be managed under the direction of the Board of Directors. Directors must
be natural persons who are at least 18 years of age but need not be shareholders
of the Corporation. Residents of any state may be directors.
Section 2. Compensation. The shareholders shall have authority to fix the
compensation of directors. Unless specifically authorized by a resolution of the
shareholders, the directors shall serve in such capacity without compensation.
Section 3. Presumption of Assent. A director who is present at a meeting of the
Board of Directors or a committee of the Board of Directors at which action on
any corporate matter is taken shall be presumed to have assented to the action
taken unless he objects at the beginning of the meeting (or promptly upon
arriving) to the holding of the meeting or transacting the specified business at
the meeting, or if the director votes against the action taken or abstains from
voting because of an asserted conflict of interest.
Section 4. Number. The Corporation shall have at least the minimum number of
directors required by law. The number of directors may be increased or decreased
from time to time by the Board of Directors.
Section 5. Election and Term. At each annual meeting of shareholders, the
shareholders shall elect directors to hold office until the next annual meeting
or until their earlier resignation, removal from office or death. Directors
shall be elected by a plurality of the votes cast by the shares entitled to vote
in the election at a meeting at which a quorum is present.
Section 6. Vacancies. Any vacancy occurring in the Board of Directors, including
a vacancy created by an increase in the number of directors, may be filled by
the shareholders or by the affirmative vote of a majority of the remaining
directors though less than a quorum of the Board of Directors. A director
elected to fill a vacancy shall hold office only until the next election of
directors by the shareholders. If there are no remaining directors, the vacancy
shall be filled by the shareholders.
Section 7. Removal of Directors. At a meeting of shareholders, any director or
the entire Board of Directors may be removed, with or without cause, provided
the notice of the meeting states that one of the purposes of the meeting is the
removal of the director. A director may be removed only if the number of votes
cast to remove him exceeds the number of votes cast against removal.
Section 8. Quorum and Voting. A majority of the number of directors fixed by
these Bylaws shall constitute a quorum for the transaction of business. The act
of a majority of directors present at a meeting at which a quorum is present
shall be the act of the Board of Directors.
Section 9. Executive and Other Committees. The Board of Directors, by resolution
adopted by a majority of the full Board of Directors, may designate from among
its members one or more committees each of which must have at least two members.
Each committee shall have the authority set forth in the resolution designating
the committee.
Section 10. Place of Meeting. Regular and special meetings of the Board of
Directors shall be held at the principal place of business of the Corporation or
at another place designated by the person or persons giving notice or otherwise
calling the meeting.
Section 11. Time, Notice and Call of Meetings. Regular meetings of the Board of
Directors shall be held without notice at the time and on the date designated by
resolution of the Board of Directors. Written notice of the time, date and place
of special meetings of the Board of Directors shall be given to each director by
mail delivery at least two days before the meeting.
Notice of a meeting of the Board of Directors need not be given to a
director who signs a waiver of notice either before or after the meeting.
Attendance of a director at a meeting constitutes a waiver of notice of that
meeting and waiver of all objections to the place of the meeting, the time of
the meeting, and the manner in which it has been called or convened, unless a
director objects to the transaction of business (promptly upon arrival at the
meeting) because the meeting is not lawfully called or convened. Neither the
business to be transacted at, nor the purpose of, any regular or special meeting
of the Board of Directors must be specified in the notice or waiver of notice of
the meeting.
A majority of the directors present, whether or not a quorum exists,
may adjourn any meeting of the Board of Directors to another time and place.
Notice of an adjourned meeting shall be given to the directors who were not
present at the time of the adjournment and, unless the time and place of the
adjourned meeting are announced at the time of the adjournment, to the other
directors. Meetings of the Board of Directors may be called by the President or
the Chairman of the Board of Directors. Members of the Board of Directors and
any committee of the Board may participate in a meeting by telephone conference
or similar communications equipment if all persons participating in the meeting
can hear each other at the same time. Participation by these means constitutes
presence in person at a meeting.
Section 12. Action By Written Consent. Any action required or permitted to be
taken at a meeting of directors may be taken without a meeting if a consent in
writing setting forth the action to be taken and signed by all of the directors
is filed in the minutes of the proceedings of the Board. The action taken shall
be deemed effective when the last director signs the consent, unless the consent
specifies otherwise.
ARTICLE II. MEETINGS OF SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of the shareholders of the
corporation for the election of officers and for such other business as may
properly come before the meeting shall be held at such time and place as
designated by the Board of Directors.
Section 2. Special Meeting. Special meetings of the shareholders shall be held
when directed by the President or when requested in writing by shareholders
holding at least 10% of the Corporation's stock having the right and entitled to
vote at such meeting. A meeting requested by shareholders shall be called by the
President for a date not less than 10 nor more than 60 days after the request is
made. Only business within the purposes described in the meeting notice may be
conducted at a special shareholders' meeting.
Section 3. Place. Meetings of the shareholders will be held at the principal
place of business of the Corporation or at such other place as is designated by
the Board of Directors.
Section 4. Notice. A written notice of each meeting of shareholders shall be
mailed to each shareholder having the right and entitled to vote at the meeting
at the address as it appears on the records of the Corporation. The meeting
notice shall be mailed riot less than 10 nor more than 60 days before the date
set for the meeting. The record date for determining shareholders entitled to
vote at the meeting will be the close of business on the day before the notice
is sent. The notice shall state the time and place the meeting is to be held. A
notice of a special meeting shall also state the purposes of the meeting. A
notice of meeting shall be sufficient for that meeting and any adjournment of
it. If a shareholder transfers any shares after the notice is sent, it shall not
be necessary to notify the transferee. All shareholders may waive notice of a
meeting at any time.
Section 5. Shareholder Quorum. A majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at a meeting of
shareholders. Any number of shareholders, even if less than a quorum, may
adjourn the meeting without further notice until a quorum is obtained.
Section 6. Shareholder Voting. If a quorum is present, the affirmative vote of a
majority of the shares represented at the meeting and entitled to vote on the
subject matter shall be the act of the shareholders. Each outstanding share
shall be entitled to one vote on each matter submitted to a vote at a meeting of
shareholders. An alphabetical list of all shareholders who are entitled to
notice of a shareholders' meeting along with their addresses and the number of
shares held by each shall be produced at a shareholders' meeting upon the
request of any shareholder.
Section 7. Proxies. A shareholder entitled to vote at any meeting of
shareholders or any adjournment thereof may vote in person or by proxy executed
in writing and signed by the shareholder or his attorney-in-fact. The
appointment of proxy will be effective when received by the Corporation's
officer or agent authorized to tabulate votes. No proxy shall be valid more than
11 months after the date of its execution unless a longer term is expressly
stated in the proxy.
Section 8. Validation. If shareholders who hold a majority of the voting stock
entitled to vote at a meeting are present at the meeting, and sign a written
consent to the meeting on the record, the acts of the meeting shall be valid,
even if the meeting was not legally called and noticed.
Section 9. Conduct of Business By Written Consent. Any action of the
shareholders may be taken without a meeting if written consents, setting forth
the action taken, are signed by at least a majority of shares entitled to vote
and are delivered to the officer or agent of the Corporation having custody of
the Corporation's records within 60 days after the date that the earliest
written consent was delivered. Within 10 days after obtaining an authorization
of an action by written consent, notice shall be given to those shareholders who
have not consented in writing or who are not entitled to vote on the action. The
notice shall fairly summarize the material features of the authorized action. If
the action creates dissenters, rights, the notice shall contain a clear
statement of the right of dissenting shareholders to be paid the fair value of
their shares upon compliance with and as provided for by the state law governing
corporations.
ARTICLE III. OFFICERS
Section 1. Officers; Election; Resignation; Vacancies. The Corporation shall
have the officers and assistant officers that the Board of Directors appoint
from time to time. Except as otherwise provided in an employment agreement which
the Corporation has with an officer, each officer shall serve until a successor
is chosen by the directors at a regular or special meeting of the directors or
until removed. Officers and agents shall be chosen, serve for the terms, and
have the duties determined by the directors. A person may hold two or more
offices.
Any officer may resign at any time upon written notice to the
Corporation. The resignation shall be effective upon receipt, unless the notice
specifies a later date. If the resignation is effective at a later date and the
Corporation accepts the future effective date, the Board of Directors may fill
the pending vacancy before the effective date provided the successor officer
does not take office until the future effective date. Any vacancy occurring in
any office of the Corporation by death, resignation, removal or otherwise may be
filled for the unexpired portion of the term by the Board of Directors at any
regular or special meeting.
Section 2. Powers and Duties of Officers. The officers of the Corporation shall
have such powers and duties in the management of the Corporation as may be
prescribed by the Board of Directors and, to the extent not so provided, as
generally pertain to their respective offices, subject to the control of the
Board of Directors.
Section 3. Removal of Officers. An officer or agent or member of a committee
elected or appointed by the Board of Directors may be removed by the Board with
or without cause whenever in its judgment the best interests of the Corporation
will be served thereby, but such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Election or appointment of an
officer, agent or member of a committee shall not of itself create contract
rights. Any officer, if appointed by another officer, may be removed by that
officer.
Section 4. Salaries. The Board of Directors may cause the Corporation to enter
into employment agreements with any officer of the corporation. Unless provided
for in an employment agreement between the Corporation and an officer, all
officers of the Corporation serve in their capacities without compensation.
Section 5. Bank Accounts. The Corporation shall have accounts with financial
institutions as determined by the Board of Directors.
ARTICLE IV. DISTRIBUTIONS
The Board of Directors may, from time to time, declare distributions to
its shareholders in cash, property, or its own shares, unless the distribution
would cause (i) the Corporation to be unable to pay its debts as they become due
in the usual course of business, or (ii) the Corporation's assets to be less
than its liabilities plus the amount necessary, if the Corporation were
dissolved at the time of the distribution, to satisfy the preferential rights of
shareholders whose rights are superior to those receiving the distribution. The
shareholders and the Corporation may enter into an agreement requiring the
distribution of corporate profits, subject to the provisions of law.
ARTICLE V. CORPORATE RECORDS
Section 1. Corporate Records. The corporation shall maintain its records in
written form or in another form capable of conversion into written form within a
reasonable time. The Corporation shall keep as permanent records minutes of all
meetings of its shareholders and Board of Directors, a record of all actions
taken by the shareholders or Board of Directors without a meeting, and a record
of all actions taken by a committee of the Board of Directors on behalf of the
Corporation. The Corporation shall maintain accurate accounting records and a
record of its shareholders in a form that permits preparation of a list of the
names and addresses of all shareholders in alphabetical order by class of shares
showing the number and series of shares held by each.
The Corporation shall keep a copy of its articles, or restated articles
of incorporation and all amendments to them currently in effect; these Bylaws or
restated Bylaws and all amendments currently in effect; resolutions adopted by
the Board of Directors creating one or more classes or series of shares and
fixing their relative rights, preferences, and limitations, if shares issued
pursuant to those resolutions are outstanding; the minutes of all shareholders'
meetings and records of all actions taken by shareholders without a meeting for
the past three years; written communications to all shareholders generally or
all shareholders of a class of series within the past three years, including the
financial statements furnished for the last three years; a list of names and
business street addresses of its current directors and officers; and its most
recent annual report delivered to the Department of State.
Section 2. Shareholders' Inspection Rights. A shareholder is entitled to inspect
and copy, during regular business hours at a reasonable location specified by
the Corporation, any books and records of the Corporation. The shareholder must
give the Corporation written notice of this demand at least five business days
before the date on which he wishes to inspect and copy the record(s). The demand
must be made in good faith and for a proper purpose. The shareholder must
describe with reasonable particularity the purpose and the records he desires to
inspect, and the records must be directly connected with this purpose. This
Section does not affect the right of a shareholder to inspect and copy the
shareholders' list described in this Article if the shareholder is in litigation
with the Corporation. In such a case, the shareholder shall have the same rights
as any other litigant to compel the production of corporate records for
examination.
The Corporation may deny any demand for inspection if the demand was
made for an improper purpose, or if the demanding shareholder has within the two
years preceding his demand, sold or offered for sale any list of shareholders of
the Corporation or of any other corporation, has aided or abetted any person in
procuring any list of shareholders for that purpose, or has improperly used any
information secured through any prior examination of the records of this
Corporation or any other corporation.
Section 3. Financial Statements for Shareholders. Unless modified by resolution
of the shareholders within 120 days after the close of each fiscal year, the
Corporation shall furnish its shareholders with annual financial statements
which may be consolidated or combined statements of the Corporation and one or
more of its subsidiaries, as appropriate, that include a balance sheet as of the
end of the fiscal year, an income statement for that year and a statement of
cash flows for that year. If financial statements are prepared for the
Corporation on the basis of generally accepted accounting principles, the annual
financial statements must also be prepared on that basis.
If the annual financial statements are reported upon by a public
accountant, his report must accompany them. If not, the statements must be
accompanied by a statement of the President or the person responsible for the
Corporation's accounting records stating his reasonable belief whether the
statements were prepared on the basis of generally accepted accounting
principles and, if not, describing the basis of preparation and describing any
respects in which the statements were not prepared on a basis of accounting
consistent with the statements prepared for the preceding year. The Corporation
shall mail the annual financial statements to each shareholder within 120 days
after the close of each fiscal year or within such additional time thereafter as
is reasonably necessary to enable the Corporation to prepare its financial
statements. Thereafter, on written request from a shareholder who was not mailed
the statements, the Corporation shall mail him the latest annual financial
statements.
Section 4. Other Reports to Shareholders. If the Corporation indemnifies or
advances expenses to any director, officer, employee or agent otherwise than by
court order or action by the shareholders or by an insurance carrier pursuant to
insurance maintained by the Corporation, the Corporation shall report the
indemnification or advance in writing to the shareholders with or before the
notice of the next annual shareholders' meeting, or prior to the meeting if the
indemnification or advance occurs after the giving of the notice but prior to
the time the annual meeting is held. This report shall include a statement
specifying the persons paid, the amounts paid, and the nature and status at the
time of such payment of the litigation or threatened litigation.
If the Corporation issues or authorizes the issuance of shares for
promises to render services in the future, the Corporation shall report in
writing to the shareholders the number of shares authorized or issued, and the
consideration received by the corporation, with or before the notice of the next
shareholders' meeting.
ARTICLE VI. STOCK CERTIFICATES
Section 1. Issuance. The Board of Directors may authorize the issuance of some
or all of the shares of any or all of its classes or series without
certificates. Each certificate issued shall be signed by the President and the
Secretary (or the Treasurer). The rights and obligations of shareholders are
identical whether or not their shares are represented by certificates.
Section 2. Registered Shareholders. No certificate shall be issued for any share
until the share is fully paid. The Corporation shall be entitled to treat the
holder of record of shares as the holder in fact and, except as otherwise
provided by law, shall not be bound to recognize any equitable or other claim to
or interest in the shares.
Section 3. Transfer of Shares. Shares of the Corporation shall be transferred on
its books only after the surrender to the Corporation of the share certificates
duly endorsed by the holder of record or attorney-in-fact. If the surrendered
certificates are canceled, new certificates shall be issued to the person
entitled to them, and the transaction recorded on the books of the Corporation.
Section 4. Lost, Stolen or Destroyed Certificates. If a shareholder claims to
have lost or destroyed a certificate of shares issued by the Corporation, a new
certificate shall be issued upon the delivery to the Corporation of an affidavit
of that fact by the person claiming the certificate of stock to be lost, stolen
or destroyed, and, at the discretion of the Board of Directors, upon the deposit
of a bond or other indemnity as the Board reasonably requires.
ARTICLE VII. INDEMNIFICATION
Section 1. Right to Indemnification. The Corporation hereby indemnifies each
person (including the heirs, executors, administrators, or estate of such
person) who is or was a director or officer of the Corporation to the fullest
extent permitted or authorized by current or future legislation or judicial or
administrative decision against all fines, liabilities, costs and expenses,
including attorneys, fees, arising out of his or her status as a director,
officer, agent, employee or representative. The foregoing right of
indemnification shall not be exclusive of other rights to which those seeking an
indemnification may be entitled. The Corporation may maintain insurance, at its
expense, to protect itself and all officers and directors against fines,
liabilities, costs and expenses, whether or not the Corporation would have the
legal power to indemnify them directly against such liability.
Section 2. Advances. Costs, charges and expenses (including attorneys' fees)
incurred by a person referred to in Section 1 of this Article in defending a
civil or criminal proceeding shall be paid by the Corporation in advance of the
final disposition thereof upon receipt of an undertaking to repay all amounts
advanced if it is ultimately determined that the person is not entitled to be
indemnified by the Corporation as authorized by this Article, and upon
satisfaction of other conditions required by current or future legislation.
Section 3. Savings Clause. If this Article or any portion of it is invalidated
on any ground by a court of competent jurisdiction, the Corporation nevertheless
indemnifies each person described in Section 1 of this Article to the fullest
extent permitted by all portions of this Article that have not been invalidated
and to the fullest extent permitted by law.
ARTICLE VIII. AMENDMENT
These Bylaws may be altered, amended or repealed, and new Bylaws
adopted, by a majority vote of the directors or by a vote of the shareholders
holding a majority of the shares.
I certify that these are the Bylaws adopted by the Board of Directors
of the Corporation.
EXHIBIT 4.1
Number Shares
GLOBALOCK CORPORATION
Incorporated under the laws of the state of Delaware
Common Stock
CUSIP 37937M 10 1
This Certifies that:
is owner of
Fully Paid and Non-Assessable Shares of Common Stock of $.001 Par Value Each of
GLOBALOCK CORPORATION
Transferable on the books of the Corporation in person or by attorney upon
surrender of this certificate duly endorsed or assigned. This certificate and
the shares represented hereby are subject to the laws of the State of Delaware,
and to the Certificate of Incorporation and Bylaws of the Corporation, as now or
hereafter amended.
This certificate is not valid until countersigned by the Transfer Agent.
WITNESS the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.
Dated: Countersigned and Registered:
Transecurities International, Inc.
Spokane, WA
Transfer Agent and Registrar
By:
----------------------------------
Authorized Signature
Corporate Seal
- ------------------------ ----------------------------------
Secretary President
<PAGE>
Back Page:
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT ______Custodian_______
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with rights under Uniform Gifts to Minors
Of survivorship and not as Act _____________________
Tenants in common (State)
Additional abbreviations may also be used though not in the above list.
For Value Received, _______________ hereby sell, assign and transfer
unto
Please insert social security or other
Identifying number of Assignee
- --------------------------------------
- --------------------------------------------------------------------------------
(please print or typewrite name and address, including zip code, of assignee)
- --------------------------------------------------------------------------------
Shares
- ------------------------------------------------------------------------
Of the stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint
Attorney
- ------------------------------------------------------------------------
To transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.
Dated
---------------------------
------------------------------------
Notice: The signature to this
assignment must correspond with the
name as written upon the face of the
certificate in every particular,
without alteration or enlargement or
any change whatsoever.
The corporation will furnish to any stockholder, upon request and without
charge, a full statement of the designations, relative rights, preferences and
limitations of the shares of each class and series authorized to be issued, so
far as the same have been determined, and of the authority, if any, of the Board
to divide the shares into classes or series and to determined and change the
relative rights, preferences and limitations of any class or series. Such
request may be made to the secretary of the corporation or to the transfer agent
named on this certificate.
- --------------------------------------------------------------------------------
The signature to the assignment must correspond to the name as written upon the
face of this certificate in every particular, without alteration or enlargement
or any change whatsoever, and must be guaranteed by a commercial bank or trust
company or a member firm of a national or regional or other recognized stock
exchange in conformance with a signature guarantee medallion program.
- --------------------------------------------------------------------------------
EMPLOYMENT AGREEMENT BETWEEN
GLOBALOCK CORPORATION AND
DANIEL ZIMMERMAN
This Employment Agreement is made and entered into as of the 1st day of
August, 1999, by and between Globalock Corporation, a Delaware corporation (the
"Company") and Daniel Zimmerman ("Zimmerman")
Whereas, the Company and Zimmerman desire that Zimmerman become an
employee of the Company under the terms and conditions set forth in this
Employment Agreement;
Therefore, in consideration of the premises and the mutual covenants
herein contained, the parties agree as follows:
1. Employment. The Company hereby employs Zimmerman, and Zimmerman
hereby accepts such employment from the Company, upon the terms and conditions
hereinafter set forth. Zimmerman represents that his employment by the Company
under the terms of this Agreement will not violate or result in a breach of any
agreement or obligation to which Zimmerman is a party or by which he may be
bound.
2. Position and Duties of Zimmerman. During Zimmerman's employment by
the Company, Zimmerman shall serve as Director of Business Development of the
Company. Zimmerman shall serve the Company to the best of Zimmerman's ability
and shall perform such duties as are required by, appropriate to and consistent
with Zimmerman's position and such other duties and in such other capacities as
are assigned to Zimmerman from time to time by the Board of Directors and
officers of the Company senior to Zimmerman. Zimmerman agrees to devote such
working time and efforts to the business of the Company (except for usual
vacations) as may be reasonably requested by the Board of Director, and to be
loyal and faithful to the Company at all times, endeavoring to improve
Zimmerman's ability and knowledge of the business of the Company in an effort to
increase the productivity and value of Zimmerman's services for the mutual
benefit of Zimmerman and the Company.
3. Term of Employment. The term of Zimmerman's employment under this
Agreement shall be for a one year period commencing as of the date hereof, and
thereafter shall continue from year to year unless terminated by either party as
of the expiration of the initial term or at any time during any such further
term, upon: (a) the giving of ninety (90) days' notice of termination or (b) in
the case of the Company, the payment of termination pay equal to the level of
base salary then payable to Zimmerman for a ninety (90) day period or any
combination of an aggregate of ninety (90) days notice and termination pay by
the Company, unless this Employment Agreement is terminated at any time during
the initial term or any subsequent term upon the earlier occurrence of any of
the following events:
(i) Upon the mutual agreement in writing of the Company and
Zimmerman to terminate Zimmerman's employment by the Company.
(ii) Upon the death of Zimmerman.
(iii) At the Company's option, by action of the Company's
Board of Directors, on thirty (30) days written notice, in the event of
Zimmerman's disability, defined as: (A) if a policy of disability
insurance is carried by the Company covering Zimmerman, as disability
is determined under such policy, or (B) if the Company does not carry a
disability insurance policy covering Zimmerman, the failure of
Zimmerman substantially to discharge Zimmerman's duties under this
Agreement for sixty (60) consecutive days at any time, or for ninety
(90) days during any eighteen (18) month period, as a result of an
injury, disease, sickness or other physical or mental incapacity.
(iv) By the Company for "cause," which shall mean that: (A)
Zimmerman has been guilty of dishonesty, stealing, embezzlement,
misappropriation of funds, violation of the provision of paragraph 6,
or excessive unexcused absenteeism from work (other than for injury,
disease, sickness or other physical or mental incapacity which is
covered under subparagraph (iii) above); or (B) Zimmerman has been
convicted of a felony.
4. Compensation.
(a) Base Salary. During the term of Zimmerman's employment
under this Agreement, the Company agrees to pay Zimmerman for
Zimmerman's services hereunder compensation at the rate of $60,000 per
annum (the "Base Salary"); provided, however, that all of the Base
Salary shall be deferred and shall become payable to Zimmerman upon the
earliest to occur of: (i) the receipt by the Company of gross proceeds
from the sale of common stock of not less than $1,000,000, (ii) the
consolidated net earnings of the Company from operations (excluding
extraordinary income and charges) for any calendar quarter being equal
to or greater than $10,000, or (iii) the common stock of the Company
having begun trading for a consecutive 30 trading day period on an
exchange, or, the NASDAQ. Such compensation shall be subject to any
required withholdings and shall be paid semi-monthly or on such other
basis as is consistent with the Company's normal practices.
5. Fringe Benefits; Expenses. During the term of Zimmerman's employment
under this Agreement:
(a) The Company will provide Zimmerman with medical (including
dependant coverage) and life insurance and other fringe benefits
normally accorded the Company's comparable officers (which may require
Zimmerman contributions); provided, however, that the foregoing shall
not obligate the Company to continue any such benefits in force or to
maintain such benefits at specific standards or levels at any time as
to any class of employees.
(b) The Company will pay directly, or reimburse Zimmerman, for
such items of reasonable and necessary expense as are authorized by the
Company and incurred by Zimmerman in the interest of the business of
the Company. All such expenses paid by Zimmerman will be reimbursed by
the Company upon the presentation by Zimmerman of an itemized account
of such expenditures, sufficient to support their deductibility to the
Company for income tax purposes, within 30 days after the date such
expenses are incurred.
6. Covenants of Zimmerman. Zimmerman covenants to and agrees with the
Company as follows:
(a) Zimmerman shall not, without the express prior consent of
the Board of Directors or President of the Company, be engaged in any
other business activity, whether or not such business activity is
pursued for gain, profit or other pecuniary advantage; but nothing
contained herein shall be construed as preventing Zimmerman from
investing Zimmerman's assets in not more than 1% of the capital stock
or other securities of any corporation whose stock or other securities
are regularly traded on a national securities exchange or in the
over-the-counter securities market and with which Zimmerman has no
employment, representative or agency relationship.
(b) During the term of Zimmerman's employment with the Company
and thereafter for a period of two (2) years, Zimmerman will not, in
any manner, directly or indirectly with or through any other person or
entity:
(i) Except as required in Zimmerman's duties to the
Company, disclose or divulge to any person or entity, or use
for Zimmerman's benefit or the benefit of any other person or
entity, directly or indirectly, as the same may exist during
the term of Zimmerman's employment by the Company or at the
date of termination of such employment, any knowledge,
information, business methods, techniques, devices, customer
lists, supplier lists, business plans, software, programs or
other data of the Company, without regard to whether all of
the foregoing matters will be otherwise deemed confidential,
material or important, the parties stipulating that as between
them, the same are important, material and confidential and
greatly affect the effective and successful conduct of the
business and the goodwill of the Company;
(ii) Divert, take away, solicit or interfere with any
of the customers, trade, suppliers, business, patronage,
employees or agents of the Company, or employ any person who
was an employee of the Company at any time during the two year
period prior to the date of such employment; or
(iii) Engage, either personally or as an employee,
partner, officer, manager, agent, advisor, associate,
consultant or otherwise, or by means of any corporate or other
entity or device, in any business which is competitive (as
hereinafter defined) with the business of the Company.
(c) For the purposes hereof, a business will be deemed
competitive with the business of the Company if it involves the
development, installation or operation of telecommunications products
or services (other than by an entity for its own use in its own
business) or other products or services which are competitive with any
business in which the Company is engaged during the term of Zimmerman's
employment by the Company or as of the date of Zimmerman's cessation of
employment, or as to which the Company has formulated definitive plans,
of which Zimmerman has knowledge, to enter into during the term of
Zimmerman's employment by the Company or as of the date of the
cessation of Zimmerman's employment with the Company.
(d) It is the intention of the parties to restrict the
activities of Zimmerman under paragraph 6(b) only to the extent
necessary for the protection of the business interests of the Company,
and the parties specifically covenant and agree that should any of the
provisions thereof, under any set of circumstances, be determined by a
court or other tribunal or authority having appropriate jurisdiction to
make such a determination to be too broad for that purpose or invalid
or unenforceable for any reason, it is the intention and agreement of
the parties that such provisions shall be so interpreted and applied by
such court, tribunal or authority in such a narrower sense as shall be
necessary to make the same valid and enforceable to the maximum extent
possible, consistent with the intent of the parties expressed in this
Agreement.
(e) The covenants and agreements of Zimmerman contained in
paragraph 6(b) shall be construed as independent of any other provision
of this Agreement and given for valuable independent consideration, and
the existence of any defense, claim or cause of action against the
Company, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of such
covenants and agreements.
(f) Except for the application of the confidentiality
provisions contained in Section 7(a), nothing in this Agreement is
intended to prevent or limit Zimmerman from publishing articles (and
assigning the copyright rights thereto to the publisher thereof) or
speaking at industry conferences.
7. Company Proprietary Rights and Materials.
(a) Zimmerman agrees to perform his duties in connection with
this Agreement in good faith and in a manner which Zimmerman reasonably
believes to be in the best interest of the Company, and with such care,
including reasonable inquiry, as an ordinary prudent person in a like
position would use under similar circumstances. Zimmerman will keep
confidential and will not directly or indirectly divulge any
confidential information of the Company to anyone (except as required
by applicable law or in connection with the performance of Zimmerman's
duties and responsibilities as an employee of the Company) nor use or
otherwise appropriate any of the Company's confidential information for
his own benefit, or for or on behalf of any other person or entity.
(b) All proprietary rights which: (i) are made, conceived or
developed with the equipment, supplies, facilities, trade secret
information, time or other assets of the Company; (ii) relate to the
business of the Company; or (iii) result from work performed for the
Company, as between Zimmerman and the Company, are and shall remain the
sole property of the Company, and upon the request of the Company,
Zimmerman shall assign any and all rights he may have therein to the
Company, subject to such restrictions as are imposed by applicable law.
The foregoing assignment obligation shall not apply to an invention
that Zimmerman develops entirely on his own time without using the
Company's equipment, supplies, facilities or trade secret information,
except for inventions (which shall be so assigned to the Company) that
either: (a) relate at the time of conception or reduction to practice
of the invention to the Company's business, or actual or demonstrably
anticipated research or development of the Company; or (b) result from
any work performed by Zimmerman for the Company.
(c) All documents, records, statements, correspondence,
invoices, statements, software, programs, models, designs, drawings,
specifications, financial statements and projections, plans, notebooks,
including copies thereof, affecting or relating to the business of the
Company, which Zimmerman shall prepare, use, construct, observe,
possess or control ("Company Materials"), shall be and remain the sole
property of the Company. Upon the termination of the employment of
Zimmerman with the Company, Zimmerman shall promptly deliver all
Company Materials to the Company.
8. Remedies.
(a) If Zimmerman terminates Zimmerman's employment with the
Company, or if such employment is terminated under paragraph 3,
Zimmerman shall be entitled only to receive accrued basic salary and
vacation pay, to the extent that such compensation has accrued and is
payable as of the date of such termination, but no other amounts
accruing or payable under this Agreement shall be payable to or for the
benefit of Zimmerman, except as otherwise specifically provided in
paragraph 3.
(b) It is expressly agreed that the breach of the terms of
this Agreement by Zimmerman will result in immediate and irreparable
injury to the Company, for which the payment of money damages would be
an inadequate remedy, and will authorize recourse to the equitable
remedies of injunction and specific performance, as well as to all
other legal or equitable remedies to which the Company may be entitled,
without a requirement that the Company post a bond or other security
therefor. No remedy conferred by any of the specific provisions of this
Agreement is intended to be exclusive of any other remedy, and each and
every remedy shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law or in
equity, by statute or otherwise. The election of any one or more
remedies by the Company shall not constitute a waiver of the right to
pursue other available remedies.
(c) Zimmerman represents and admits that in the event of the
cessation of Zimmerman's employment for any reason, Zimmerman's
experience and capabilities are such that Zimmerman can obtain
employment in another business engaged in other lines or of a different
nature, and that the issuance and enforcement of equitable remedies
which require the performance of any provision of this Agreement by
Zimmerman, including the provisions of paragraph 6(b), will not prevent
Zimmerman from earning a livelihood.
(d) In the event the Company or Zimmerman engages counsel or
institutes a suit at law or in equity for the purpose of enforcing the
provisions of this Agreement, the prevailing party in any such action
shall be entitled to recover reasonable attorneys' fees and expenses
and related costs and expenses, in addition to any other judgment,
award or remedy to which the prevailing party may be entitled. In the
event of a settlement or judgment or order of a court, the prevailing
party shall be considered to be that party whose last written
settlement offer most nearly matches the final agreement or result.
Where there is an allocation of remedies, such attorneys' fees and
expenses and related costs and expenses shall be allocated among the
parties equitably according to the results determined relative to any
written offer of settlement made by the parties. (For example, if a
party demands $10,000 and the other party offers to pay or settle the
matter for $6,000 and the outcome is $7,000, the party offering $6,000
shall be considered to be the prevailing party.)
9. Severability. All agreements and covenants herein contained are
severable, and in the event any of them shall be held to be invalid by any
competent court or other tribunal or authority having appropriate jurisdiction,
this Agreement shall continue in full force and effect and, subject to
subparagraph 6(d), shall be interpreted as if such invalid agreements or
covenants were not contained herein.
10. Waiver or Modification. No waiver, amendment or modification of
this Agreement or any portion hereof shall be valid unless in writing and duly
executed by the party to be charged therewith. No evidence of any waiver,
amendment or modification shall be offered or received in evidence in any
proceeding, arbitration or litigation between the parties arising out of or
affecting this Agreement, or the rights or obligations of the parties hereunder,
unless such waiver, amendment or modification is in writing and duly executed as
aforesaid. The failure of either party to exercise or otherwise act with respect
to any of its rights hereunder in the event of a breach of any of the terms or
conditions hereof by the other party shall not be construed as a waiver of such
breach, nor prevent the party from thereafter enforcing strict compliance with
any and all of the terms and conditions hereof.
11. Notices. All notices, requests, demands, consents or other
communications hereunder shall be in writing and shall be deemed to have been
given if delivered personally or mailed by certified, registered or Express
mail, return receipt requested, or next business day courier service (such as
Federal Express), if to the Company, to:
Globalock Corporation
Attention: President
860 Via de la Paz
Pacific Palisades, California 90272, U.S.A.
and, if to Zimmerman, to:
Daniel Zimmerman
860 Via de la Paz
Pacific Palisades, California 90272
or to such other address to which a party gives notice to the other in
accordance with this paragraph 11.
12. Construction.
(a) This Employment Agreement shall be governed by and
construed under the laws of the State of Washington, notwithstanding
the place of execution hereof or the performance of any acts under this
Agreement in any other jurisdiction.
(b) For purposes of paragraphs 6 and 7, references to the
Company shall include all companies or other entities controlled by,
controlling, or under common control with the Company, whether such
control is exercised through ownership or other direction of the
management or policies of any such company or entity, and all licensees
of the Company.
13. Successors. This Agreement shall be binding upon and shall inure to
the benefit of the Company and Zimmerman and their respective successors,
assigns, heirs, executors, administrators and legal representatives.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
GLOBALOCK CORPORATION
By:
------------------------------
-----------------------------------
Daniel Zimmerman
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
We hereby consent to the use of the Form 10-SB Registration Statement, of
GlobaLock Corporation our report for the period from August 5, 1998 (inception)
to October 31, 1998 dated March 15, 1999 and for the period from August 5, 1998
(inception) to April 30, 1999 dated June 15, 1999, relating to the financial
statements of GlobaLock Corporation which appear in such Form 10-SB.
/s/ Weinberg & Company, P.A.
WEINBERG & COMPANY, P.A.
Certified Public Accountants
Boca Raton, Florida
July 29, 1999
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of GlobaLock Corporation for the year ended October 31,
1998 and the 4 month period ended April 30, 1999, and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> OTHER 4-MOS
<FISCAL-YEAR-END> 0CT-31-1998 OCT-31-1999
<PERIOD-START> AUG-05-1998 JAN-01-1999
<PERIOD-END> OCT-31-1998 APR-30-1999
<CASH> 1,807 770
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 1,807 770
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 1,807 770
<CURRENT-LIABILITIES> 215 4,515
<BONDS> 0 0
0 0
0 0
<COMMON> 10,000 2,000
<OTHER-SE> (8,408) (5,745)
<TOTAL-LIABILITY-AND-EQUITY> 1,807 770
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> (8,408) (4,574)
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (8,408) (4,574)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (8,408) (4,574)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (8,408) (4,574)
<EPS-BASIC> (.067) (.005)
<EPS-DILUTED> (.067) (.005)
</TABLE>
EXHIBIT 99.1
STATEMENT REGARDING RISKS AND UNCERTAINTIES
AN INVESTMENT IN GLOBALOCK INVOLVE A HIGH DEGREE OF RISK AND SHOULD BE
PURCHASED ONLY BY PERSONS WHO CAN AFFORD TO SUSTAIN A TOTAL LOSS OF THEIR
INVESTMENT. THE RISK FACTORS SET FORTH BELOW ARE NOT INTENDED TO BE AN
EXHAUSTIVE LIST OF THE GENERAL OR SPECIFIC RISKS INVOLVED, BUT MERELY TO
IDENTIFY CERTAIN RISKS THAT ARE NOW FORESEEN BY THE COMPANY. IT MUST BE
RECOGNIZED THAT OTHER RISKS, NOT NOW FORESEEN, MIGHT BECOME SIGNIFICANT IN THE
FUTURE AND THAT THE RISKS WHICH ARE NOW FORESEEN MIGHT AFFECT GLOBALOCK TO A
GREATER EXTENT THAN IS NOW FORESEEN OR IN A MANNER NOT NOW CONTEMPLATED.
Broad Discretion of Management
GlobaLock is a "blank check" company organized for the purpose of
engaging in a merger or other business combination with a presently unidentified
operating company. Management has broad discretion to engage in virtually any
business combination in virtually any manner it deems appropriate. Stockholders
are unlikely to have the opportunity to review, or evaluate the merits and risks
of, any proposed business opportunity presented to GlobaLock and must rely upon
management to properly expend GlobaLock's funds. Furthermore, there can be no
assurance that GlobaLock will not attempt a business combination with a business
which has a history of operating or financial difficulties that may increase the
risks borne by GlobaLock's stockholders. In addition, GlobaLock `s management
may not possess the experience and skills necessary to make an informed judgment
about the business or industry that may be chosen. Accordingly, an investment in
the Common Stock involves an extremely high degree of risk and speculation for
purchasers.
Issuance of Additional Shares in Business Combination; Probable Change of
Control
GlobaLock's capital resources are insufficient to acquire any business
venture in a manner that would permit the stockholders of the company to retain
control of the venture. Although GlobaLock has no commitments or contracts to
acquire any business, it is likely that any business combination conducted by
GlobaLock will involve the issuance of a substantial number of additional shares
of GlobaLock `s Common Stock, resulting in the transfer of control over its
affairs to others and a substantial dilution of the relative voting and economic
interest held by GlobaLock `s stockholders in the results of GlobaLock `s
operations. No assurance can be given as to the experience or qualifications of
any persons who may acquire control of the company, either in connection with
the activities of GlobaLock or the operation of the business acquired by it.
Possible Illiquidity Due to Lack of Active Trading Market
Prior to this registration statement there has been no public market
for the Common Stock. Although after the consummation of a business combination
we intend to apply for trading privileges on the Nasdaq Bulletin Board, there
can be no assurance that such an application will be approved or, if approved,
that an active or liquid trading market will develop. If a trading market does
develop, it may not be sustained. If the Common Stock is not approved for
listing or the trading price is less than $5.00 per share, the Common Stock
could be subject to Rule 15g-9 of the Exchange Act, which, among other things,
requires that broker-dealers satisfy special sales practice requirements,
including making individualized written suitability determinations and receiving
a purchaser's written consent prior to any transaction. Moreover, the Common
Stock could be considered a "penny stock, " which would require additional
disclosure in connection with trades in GlobaLock's securities, including the
delivery of a disclosure schedule explaining the nature and risks of the penny
stock market. Such requirements could limited the release of market prices of
the Common Stock and reduce news coverage of the company. Such events may reduce
investors' interest in the Common Stock and materially and adversely affect the
trading prices for the Common Stock and the ability of stockholders to sell
Common Stock in the secondary market.
No Operating History
GlobaLock was organized less than one year prior to the filing of this
registration statement and has not conducted any business activities, other than
with respect to organizational matters. GlobaLock has no business history that
investors can analyze to aid them in making an informed judgment as to the
merits of an investment in GlobaLock. As a new business, GlobaLock is subject to
all of the risks inherent in the commencement of a new business enterprise with
new management, including unforeseen costs, expenses, problems and risks. There
can be no assurance that GlobaLock will be able to achieve its business
objectives.
Dependence on Part-time, Inexperienced Management
GlobaLock `s success will be largely dependent on the decisions made by
George A. Todt, GlobaLock's sole director, who will not devote his full time to
the affairs of the company. Although Mr. Todt has general business experience,
it is unlikely that he will have any significant experience in acquiring any
particular type of business.
Inability to Exhaustively Evaluate Potential Opportunities
GlobaLock's limited funds and lack of full-time management will make it
impractical to conduct a complete and exhaustive investigation and analysis of a
business opportunity before GlobaLock commits its capital or other resources. It
is likely, therefore, that management decisions may be made without detailed
feasibility studies, independent analyses, market surveys and the like, which
would be desirable and which might be obtained if GlobaLock had more funds
available to it. GlobaLock will be particularly dependent in making decisions on
information provided by promoters, owners, sponsors or other persons associated
with the business under consideration as a candidate for a business combination
with GlobaLock. It is likely that such persons will have a direct economic
interest in completing a transaction with GlobaLock.
Conflicts of Interest
The executive officers and the director of GlobaLock intend to engage
in other business activities similar and dissimilar to those engaged in by
GlobaLock. To the extent that such officers and director engages in such other
activities, they may have conflicts of interest in diverting opportunities to
other companies, entities or persons with which they are or may be associated or
have an interest, rather than directing such opportunities to GlobaLock. In
addition, the other business activities of such persons will reduce the time and
energy devoted by them to GlobaLock. No policy has been established for the
resolution of such conflicts and GlobaLock may be adversely affected if its
officers and director choose to place their other business interests before
those of GlobaLock.
