Securities and Exchange Commission
Washington, D.C. 20549
_______________
Form 10-SB/A
Amendment No. 2
______________
GENERAL FORM FOR REGISTRATION OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF
THE SECURITIES EXCHANGE ACT OF 1934
GLOBALWISE INVESTMENTS, INC.
(Name of registrant in its charter)
Nevada 870613716
(State of incorporation) (I.R.S. Employer Identification No.)
525 South 300 East, Suite 201
Salt Lake City, Utah 84111
(801) 323-2395
(Address and telephone number of principal executive offices
and principal place of business)
________________
Securities registered pursuant to Section 12(b) of the Act:
None
________________
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.001
Title of each class
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Table of Contents
PART I
Item 1: Description of Business...........................................3
Item 2: Management's Discussion and Analysis or Plan of Operation.........7
Item 3: Description of Property...........................................8
Item 4: Security Ownership of Certain Beneficial Owners and Management....8
Item 5: Directors, Executive Officers, Promoters and Control Persons......9
Item 6: Executive Compensation............................................9
Item 7: Certain Relationships and Related Transactions....................9
Item 8: Description of Securities.........................................10
PART II
Item 1: Market Price for Common Equity and Related Stockholder Matters....10
Item 2: Legal Proceedings.................................................10
Item 3: Changes in and Disagreements with Accountants.....................11
Item 4: Recent Sales of Unregistered Securities...........................11
Item 5: Indemnification of Directors and Officers.........................12
PART F/S
Index to Financial Statements.............................................12
PART III
Item 1: Index to and Description of Exhibits..............................13
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FORWARD LOOKING STATEMENTS
In this registration statement references to "Globalwise," "we," "us,"
and "our" refer to Globalwise Investments, Inc.
This Form 10-SB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. For this
purpose any statements contained in this Form 10-SB that are not statements of
historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements. These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
Globalwise's control. These factors include but are not limited to economic
conditions generally and in the industries in which Globalwise may
participate; competition within Globalwise's chosen industry, including
competition from much larger competitors; technological advances and failure
by Globalwise to successfully develop business relationships.
ITEM 1: DESCRIPTION OF BUSINESS
Business Development
Globalwise Investments, Inc. was incorporated in the state of Utah on
October 3, 1997 to engage in the confectionary vending machine business. In
March 2000 we agreed to sell all of our assets and liabilities for 150,000
shares of our outstanding stock. (See, "Certain Relationships and Related
Transactions," below for further details.) On July 12, 2000, Globalwise
Investments, Inc. was incorporated in the state of Nevada and on July 21, 2000
Globalwise Utah merged with Globalwise Nevada for the sole purpose of changing
our domicile from the state of Utah to the state of Nevada.
Our Plan
We are a "blank check" company and have had recurring operating losses
for the past two fiscal years. Our independent auditors have expressed doubt
that we can continue as a going concern unless we obtain financing to continue
operations.
Our business plan is to seek, investigate, and, if warranted, acquire an
interest in a business opportunity. Our acquisition of a business opportunity
may be made by merger, exchange of stock, or otherwise. We have very limited
sources of capital, and we probably will only be able to take advantage of one
business opportunity. At the present time we have not identified any business
opportunity that we plan to pursue, nor have we reached any preliminary or
definitive agreements or understandings with any person concerning an
acquisition or merger.
We have voluntarily filed this registration statement to become a
reporting company. Based on current economic and regulatory conditions,
management believes that it is possible, if not probable, for a company like
ours, without many assets or liabilities, to negotiate a merger or acquisition
with a viable private company. The opportunity arises principally because of
the high legal and accounting fees and the length of time associated with the
registration process of "going public". However, should any of these
conditions change, it is very possible that there would be little or no
economic value for anyone taking over control of Globalwise. In addition,
these reporting obligations involve considerable time, energy and professional
fees. (See, "Reports to Security Holders," below.) We will incur expenses
due to the legal and accounting services required to prepare such reports and
the costs of filing such reports with the Securities and Exchange Commission
("SEC"). Also, our management must expend time and effort to assist in the
preparation and review of such reports. In the event we acquire a business
opportunity we may incur additional expenses related to proxy or information
statements we must provide to our stockholders which disclose that company's
business operations, management and financial condition. In addition,
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the acquired or merged company will be subject to these same reporting
obligations.
Our search for a business opportunity will not be limited to any
particular geographical area or industry, including both U.S. and
international companies. Our management has unrestricted discretion in
seeking and participating in a business opportunity, subject to the
availability of such opportunities, economic conditions and other factors.
Our management believes that companies who desire a public market to enhance
liquidity for current stockholders, or plan to acquire additional assets
through issuance of securities rather than for cash will be potential merger
or acquisition candidates.
The selection of a business opportunity in which to participate is
complex and extremely risky and will be made by management in the exercise of
its business judgement. There is no assurance that we will be able to
identify and acquire any business opportunity which will ultimately prove to
be beneficial to us and our stockholders. Should a merger or acquisition
prove unsuccessful, it is possible management may decide not to pursue further
acquisition activities and management may abandon its activities and we may
become dormant or be dissolved.
Our activities are subject to several significant risks which arise
primarily as a result of the fact that we have no specific business and may
acquire or participate in a business opportunity based on the decision of
management which will, in all probability, act without consent, vote, or
approval of our stockholders.
It is possible that the range of business opportunities that might be
available for consideration by us could be limited by impact of the SEC
regulations regarding purchase and sale of "penny stock." Our common stock is
not publicly traded at this time and we cannot assure that a market will
develop or that a stockholder ever will be able to liquidate his investments
without considerable delay, if at all. If a market develops, our shares will
likely be subject to the rules of the Penny Stock Suitability Reform Act of
1990. The liquidity of penny stock is affected by specific disclosure
procedures required by this Act to be followed by all broker-dealers,
including but not limited to, determining the suitability of the stock for a
particular customer, and obtaining a written agreement from the customer to
purchase the stock. This rule may affect the ability of broker-dealers to
sell our securities and may affect the ability of purchasers to sell our
securities in any market.
Investigation and Selection of Business Opportunities
We anticipate that business opportunities will come to our attention
from various sources, including our officers and directors, our stockholders,
professional advisors such as attorneys and accountants, securities
broker-dealers, investment banking firms, venture capitalists, members of the
financial community and others who may present unsolicited proposals.
Management expects that prior personal and business relationships, and
specifically, our relationship with Mutual Ventures Corporation, an investment
banking firm, may lead to contacts with these various sources.
Our management will analyze the business opportunities, however, none of
our management are professional business analysts. (See, Item 5: "Directors
and Executive Officers.") Our management has had limited experience with
mergers and acquisitions of business opportunities and has not been involved
with an initial public offering. Don Mayer, our President, has been involved
with one prior merger as president of Millennium Plastics Corporation, a blank
check company. The merger was structured as a stock-for-stock exchange
between Millennium Plastics and Graduated Plastics Corporation, a plastics
company, and was completed in December of 1999. Pursuant to the terms of the
merger agreement, Mr. Mayer resigned as president of Millennium Plastics upon
consummation of the merger.
Management may rely on promoters or their affiliates, principal
stockholders or associates to assist in the investigation and selection of
business opportunities. It is likely we will issue shares to these
individuals in consideration for their services in the investigation of
business opportunities. Our management may also hire an outside consultant.
It is likely we will hire consultants or advisors with whom our management has
established prior
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relationships. Since our management has no current plans to use any outside
consultants or advisors to assist in the investigation and selection of
business opportunities, no policies have been adopted regarding use of such
consultants or advisors. We have not established the criteria to be used in
selecting such consultants or advisors, the service to be provided, the term
of service, or the total amount of fees that may be paid. However, because of
our limited resources, it is likely that any such fee we agree to pay would be
paid in stock and not in cash. In addition, there is a possibility that the
amount of consultant fees may become a factor in negotiations related to a
business opportunity.
Certain conflicts of interest exist or may develop between Globalwise
and our officers and directors. Our management has other business interests
to which they currently devote attention, which include their primary
employment and management of other blank check reporting companies. They may
be expected to continue to devote their attention to these other business
interests although management time should be devoted to our business. As a
result, conflicts of interest may arise that can be resolved only through
their exercise of judgement in a manner which is consistent with their
fiduciary duties to us. In particular, our officers and directors are
directors of other blank check companies with a structure and a business plan
which is identical to ours and, they may, in the future, be involved with
other blank check companies. In the process of negotiations for an
acquisition or merger or determination of consulting fees related to
investigation of a business opportunity, our principal stockholders and
management may consider their own personal pecuniary benefit or the interests
of other blank check companies they are affiliated with rather than the best
interests of Globalwise's other stockholders.
We presently do not foresee entering into a merger or acquisition
transaction with any business with which our officers or directors are
currently affiliated. We may acquire or merge with companies of which our
management's affiliates or associates have a direct or indirect ownership
interest. If we determine in the future that a transaction with an affiliate
would be in our best interest we are permitted by Nevada law to enter into
such a transaction if:
(1) The material facts regarding the relationship or interest of
the affiliate in the contract or transaction are disclosed or are known to the
Board of Directors. The board authorizes the contract or transaction by the
affirmative vote of a majority of the disinterested directors, even though the
disinterested directors constitute less than a quorum; or
(2) The material facts regarding the relationship or interest of
the affiliate in the contract transaction are disclosed or are known to the
stockholders entitled to vote on the transaction, and the contract or
transaction is specifically approved by vote of the stockholders; or
(3) The contract or transaction is fair to us at the time it is
authorized, approved or ratified by the Board of Directors or the
stockholders.
A decision to participate in a specific business opportunity may be made
upon our management's analysis of the quality of the other company's
management and personnel, the anticipated acceptability of the business
opportunity's new products or marketing concept, the merit of its
technological changes, the perceived benefit that it will derive from becoming
a publicly held entity, and numerous other factors which are difficult, if not
impossible, to analyze through the application of any objective criteria. In
many instances, we anticipate that the historical operations of a specific
business opportunity may not necessarily be indicative of the potential for
the future because of the possible need to shift marketing approaches
substantially, expand significantly, change product emphasis, change or
substantially augment management, or make other changes. We will be dependent
upon the owners of a business opportunity to identify any such problems which
may exist and to implement, or be primarily responsible for the implementation
of, required changes.
In our analysis of a business opportunity we anticipate that we will
consider, among other things, the following factors:
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(1) Potential for growth and profitability, indicated by new
technology, anticipated market expansion, or new products;
(2) Our perception of how any particular business opportunity will be
received by the investment community and by our stockholders;
(3) Whether, following the business combination, the financial
condition of the business opportunity would be, or would have a significant
prospect in the foreseeable future of becoming sufficient to enable our
securities to qualify for listing on a exchange or on a national automated
securities quotation system, such as NASDAQ.
(4) Capital requirements and anticipated availability of required
funds, to be provided by us or from operations, through the sale of additional
securities, through joint ventures or similar arrangements, or from other
sources;
(5) The extent to which the business opportunity can be advanced;
(6) Competitive position as compared to other companies of similar
size and experience within the industry segment as well as within the industry
as a whole;
(7) Strength and diversity of existing management, or management
prospect that are scheduled for recruitment;
(8) The cost of our participation as compared to the perceived
tangible and intangible values and potential; and
(9) The accessibility of required management expertise, personnel, raw
materials, services, professional assistance, and other required items.
No one of the factors described above will be controlling in the
selection of a business opportunity. Management will attempt to analyze all
factors appropriate to each opportunity and make a determination based upon
reasonable investigative measures and available data. Potentially available
business opportunities may occur in many different industries and at various
stages of development. Thus, the task of comparative investigation and
analysis of such business opportunities will be extremely difficult and
complex. Potential investors must recognize that, because of our limited
capital available for investigation and management's limited experience in
business analysis, we may not discover or adequately evaluate adverse facts
about the opportunity to be acquired.
Form of Acquisition
We cannot predict the manner in which we may participate in a business
opportunity. Specific business opportunities will be reviewed as well as our
needs and desires and those of the promoters of the opportunity. The legal
structure or method deemed by management to be suitable will be selected based
upon our review and our relative negotiating strength. Such method may
include, but is not limited to, leases, purchase and sale agreements,
licenses, joint ventures and other contractual arrangements. We may act
directly or indirectly through an interest in a partnership, corporation or
other forms of organization. We may be required to merge, consolidate or
reorganize with other corporations or forms of business organization. In
addition, our present management and stockholders most likely will not have
control of a majority of our voting shares following a merger or
reorganization transaction. As part of such a transaction, our existing
directors may resign and new directors may be appointed without any vote by
our stockholders.
We likely will acquire our participation in a business opportunity
through the issuance of common stock or other securities. Although the terms
of
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any such transaction cannot be predicted, it should be noted that issuance of
additional shares might also may be done simultaneously with a sale or
transfer of shares representing a controlling interest by current principal
stockholders.
Competition
We expect to encounter substantial competition in our effort to locate
attractive opportunities. Business development companies, venture capital
partnerships and corporations, venture capital affiliates of large industrial
and financial companies, small investment companies, and wealthy individuals
will be our primary competition. Many of these entities will have
significantly greater experience, resources and managerial capabilities than
we do and will be in a better position than we are to obtain access to
attractive business opportunities. We also will experience competition from
other public "blank check" companies, many of which may have more funds
available.
Employees
We currently have no employees. Our management expects to confer with
consultants, attorneys and accountants as necessary. We do not anticipate a
need to engage any full-time employees so long as we are seeking and
evaluating business opportunities. We will determine the need for employees
based upon the specific business opportunity.
Reports to Security Holders
Globalwise has voluntarily elected to file this Form 10-SB registration
statement in order to become a reporting company under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). We are required to comply with
the reporting requirements of the Exchange Act. We are required to file
annual, quarterly and other reports with the SEC. We are also subject to the
proxy solicitation requirements of the Exchange Act and, accordingly, will
furnish an annual report with audited financial statements to our
stockholders.
Available Information
Copies of this registration statement may be inspected, without charge,
at the SEC's Public Reference Room at 450 Fifth Street N.W., Washington, D.C.
20549. The public may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0300. Copies of this material
also should be available through the Internet by using the SEC's EDGAR
Archive, which is located at http://www.sec.gov.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operation
We have no assets and have experienced losses from inception. For the
nine month period ended September 30, 2000, we had no cash on hand and total
current liabilities of $1,345. In June 2000 our management exchanged all of
the assets and liabilities of our vending machine business for 150,000 shares
of our outstanding stock.
Since inception, we have primarily financed our operations through the
sale of our common stock. In November 1997 we issued 300,000 post-split
common shares to purchase vending machines and equipment valued at
approximately $19,100. From January through March 1999 we raised $65,000
through a private placement of 652,000 post-split common stock to commence our
vending machine operations. In July 2000 we issued 28,000 common shares for
investment banking services and costs advanced on our behalf valued at
$15,000. Management anticipates future private placements of our common
shares, however, we presently are not conducting any offering.
We have no commitments for capital expenditures for the next twelve
months. During the next twelve
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months we believe that our current cash needs can be met by loans from our
directors, officers and stockholders based on understandings we have with
these individuals. We anticipate that Mutual Ventures will continue to
provide investment banking services and advance costs on our behalf. We may
repay these loans, costs of services and advancements with cash, if
available, or we may convert them into common stock.
Our management intends to actively seek business opportunities during
the next twelve months and if we obtain a business opportunity, it may be
necessary to raise additional capital. This may be accomplished by selling
our common stock.
ITEM 3: DESCRIPTION OF PROPERTIES
We do not currently own or lease any property. We utilize office space
in the office of a stockholder at no cost. Until we pursue a viable business
opportunity and recognize income, we will not seek independent office space.
ITEM 4: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership of our
outstanding common stock by our management and each person or group known by
us to own beneficially more than 5% of our outstanding common stock.
Beneficial ownership is determined in accordance with the rules of the SEC and
generally includes voting or investment power with respect to securities.
Except as indicated by footnote, the persons named in the table below have
sole voting power and investment power with respect to all shares of common
stock shown as beneficially owned by them. The percentage of beneficial
ownership is based on 850,000 shares of common stock outstanding as of
November 28, 2000.
CERTAIN BENEFICIAL OWNERS
Common Stock Beneficially Owned
----------------------------------------
Name and Address of Number of Shares of
Beneficial Owners Common Stock Percentage of Class
--------------------------- ------------------ -------------------
Aaron Nelson 50,000 (1) 5.9%
5710 E. Tropicana #2023
Las Vegas, Nevada 89122
Brent Nelson 150,000 17.6%
1238 Thames Ct.
Salt Lake City, Utah 84123
(1) Includes 25,000 shares held by spouse.
MANAGEMENT
Common Stock Beneficially Owned
-------------------------------
Name and Address of Number of Shares of
Beneficial Owners Common Stock Percentage of Class
-------------------------- ------------------- -------------------
Don Mayer 17,500 2.0%
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6360 South 3000 East #205
Salt Lake City, Utah 84121
Anita Patterson 10,000 1.2%
525 South 300 East, Suite 201
Salt Lake City, Utah 84111
Directors and officers as a group 27,500 3.2%
ITEM 5: DIRECTORS AND EXECUTIVE OFFICERS
Our executive officers and directors and their respective ages,
positions and term of office are set forth below. Biographical information
for each of those persons is also presented below. Our bylaws require two
directors who serve for terms of one year and our executive officers are
chosen by our Board of Directors and serve at its discretion. There are no
existing family relationships between or among any of our executive officers
or directors.
Director or
Name Age Position Held Officer Since
----------------- -- -------------- -------------
Don Mayer 60 President, Director July 11, 2000
Anita Patterson 33 Secretary/Treasurer, Director June 27, 2000
Donald R. Mayer. Mr. Mayer has been the President and a director of
Universal Business Insurance for the past ten years. He has worked in the
insurance industry for over 17 years, specializing in the motel/hotel
industry. He is a director of WorldNet, Inc. of Nevada, a blank check
reporting company. He graduated from the University of Utah, located in Salt
Lake City, Utah, with a B.A in accounting in 1971.
Anita Patterson. From 1996 to the present Ms. Patterson has worked as a
paralegal specializing in corporate law for Mutual Ventures Corporation. In
1994 she received an Associate of Arts degree in the paralegal program from
Phillips Junior College. She attended Weber State University during 1986 and
1987. She is a director of Earth Products Technologies, Inc., Skinovation
Pharmaceutical, Inc. and Wings & Things, Inc., which are blank check reporting
companies.
ITEM 6: EXECUTIVE COMPENSATION
None of our named executive officers received any cash compensation,
bonuses, stock appreciation rights, long term compensation, stock awards or
long-term incentive rights in excess of $100,000 from us during the past three
fiscal years. Neither our chief executive officer or any person acting in
that capacity, nor any officer or director received compensation during our
most recent fiscal year. We have not entered into employment contracts with
our executive officers and their compensation, if any, will be determined at
the discretion of our Board of Directors.
Compensation of Directors
We do not have any standard arrangement for compensation of our
directors for any services provided as director, including services for
committee participation or for special assignments.
ITEM 7: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On March 3, 2000, our management determined that it was in the best
interests of Globalwise to sell the
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assets and liabilities of our vending machine business and we formalized an
agreement to sell the assets and liabilities to Brent Nelson, our then
President and Director. In June 2000 Mr. Nelson exchanged 150,000 shares of
Globalwise common stock held by him to purchase these assets and liabilities.
The shares were valued at $62,306 based upon the value of our total current
assets, which included equipment and inventory, less our total current
liabilities as of March 2000 date. This transaction was negotiated between
related parties without "arms length" bargaining and as a result the terms of
this transaction may be different than transactions between unrelated parties.
In July 2000, Mr. Nelson resigned as President and Director to pursue other
interests. We subsequently canceled and returned the 150,000 shares to our
treasury.
On July 13, 2000, an aggregate of 20,000 shares were issued to our
directors and officers in consideration for their services performed and to be
performed in those positions. 10,000 shares valued at approximately $2,500
were issued to Don Mayer and 10,000 shares valued at approximately $2,500 were
issued to Anita Patterson. This transaction was negotiated between related
parties without "arms length" bargaining and as a result the terms of this
transaction may be different than transactions between unrelated parties.
Currently, these officers and directors do not actively oversee any business
operations. However, they have expended time and effort for corporate
matters, such as, completion of the change of domicile merger, the gathering
of information and oversight of preparation of our financial statements and
this registration statement, as well as continued informal efforts to locate a
business opportunity.
ITEM 8: DESCRIPTION OF SECURITIES
Common Stock
We are authorized to issue 50,000,000 shares of common stock, par value
$.001, of which 850,000 were issued and outstanding as of November 28, 2000.
All shares of common stock have equal rights and privileges with respect to
voting, liquidation and dividend rights. Each share of common stock entitles
the holder thereof (i) to one non-cumulative vote for each share held of
record on all matters submitted to a vote of the stockholders, (ii) to
participate equally and to receive any and all such dividends as may be
declared by the Board of Directors out of funds legally available; and (iii)
to participate pro rata in any distribution of assets available for
distribution upon liquidation of the Company. Our stockholders have no
preemptive rights to acquire additional shares of common stock or any other
securities. On June 3, 1999 we authorized a 50-to-1 forward stock split. The
discussions in this document reflect post-split shares.
PART II
ITEM 1: MARKET PRICE FOR COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
We have had no market activity in our stock as of this filing. As of
November 28, 2000 we have approximately 42 stockholders of record holding
850,000 common shares. 652,000 shares are free trading and 198,000 shares are
restricted stock as that term is defined in Rule 144. We have not declared
dividends on our common stock and do not anticipate paying dividends on our
common stock in the foreseeable future.
ITEM 2: LEGAL PROCEEDINGS
We are not a party to any proceedings or threatened proceedings as of
the date of this filing.
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ITEM 3: CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
On June 30, 2000, Chisholm & Associates replaced our former independent
auditor, Andersen Andersen & Strong LC. Our Board of Directors participated
in and approved the decision to change independent accountants. Andersen
Andersen & Strong audited our financial statements for the years ended
December 31, 1999 and 1998 and their report on such financials, dated February
10, 2000, did not contain an adverse opinion, disclaimer of opinion nor was it
modified as to uncertainty, audit scope or accounting principles. There were
no disagreements with Andersen Andersen & Strong on any matter regarding
accounting principles or practices, financial statement disclosure, or
auditing scope or procedure during the two fiscal years or any subsequent
interim period preceding the date of their dismissal.
Neither we, nor someone on our behalf, consulted with Chisholm &
Associates prior to its engagement regarding the application of accounting
principles to a specific completed or contemplated transaction or the type of
audit opinion that might be rendered on our financial statements. Nor was a
written report or oral advice provided to us that Chisholm & Associates
considered was an important factor we relied on in reaching decisions about
accounting, auditing or financial reporting issues.
In January of 2000 Andersen Andersen & Strong replaced our former
independent auditor Crouch, Bierwolf and Chisholm. Our Board of Directors
participated in and approved the decision to change independent accountants.
Crouch, Bierwolf and Chisholm had audited our financials statements for the
nine months ended September 30, 1998 and December 31, 1997. Crouch, Bierwolf
and Chisholm's report on such financials, dated October 20, 1998, did not
contain an adverse opinion, disclaimer of opinion nor was it modified as to
uncertainty, audit scope or accounting principles. There were no
disagreements with Crouch, Bierwolf and Chisholm on any matter regarding
accounting principles or practices, financial statement disclosure, or
auditing scope or procedure during the two fiscal years or any subsequent
interim period preceding the date of their dismissal.
Neither we, nor someone on our behalf, consulted with Andersen Andersen
& Strong prior to its engagement regarding the application of accounting
principles to a specific completed or contemplated transaction or the type of
audit opinion that might be rendered on our financial statements. Nor was a
written report or oral advice provided to us that Andersen Andersen & Strong
considered was an important factor we relied on in reaching decisions about
accounting, auditing or financial reporting issues.
ITEM 4: RECENT SALES OF UNREGISTERED SECURITIES
The following discussion describes all securities sold by Globalwise
within the past three years without registration:
On November 13, 1997 at the organizational meeting, we issued 300,000
(6,000 pre-split) shares, valued at approximately $19,100 to Brent Nelson, our
then President and Director for equipment. We relied on an exemption from
registration under the Securities Act of 1933 by reason of Section 4(2) as a
private transaction not involving a public distribution. Mr. Nelson had
access to the same kind of information as would be available in a registration
statement regarding Globalwise and Globalwise reasonably believed he possessed
sufficient sophistication to evaluate the information provided.
Beginning in January 1999 and ending in late March 1999, we offered a
minimum of 12,400 shares up to a maximum of 15,000 shares for cash at $5 per
share in a private offering pursuant to Regulation D Rule 504. We sold
652,000 (13,040 pre-split) shares to 40 purchasers for $65,000. We relied on
an exemption from the registration requirements of the Securities Act of 1933
by reasons of Section 3(b) and Regulation D as a Rule 504 limited offering.
Such offering did not exceed the $1 million aggregate limitation for sales of
securities pursuant to Rule 504(b)(2) for the twelve months prior to and
during the offering. Each purchaser was provided the same kind of information
as would be available in a registration statement regarding Globalwise and
Globalwise reasonably
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believed each purchaser possessed sufficient sophistication to evaluate the
information provided.
On July 13, 2000 an aggregate of 20,000 shares valued at approximately
$5,000 were issued. 10,000 shares were issued to Don Mayer and 10,000 shares
were issued to Anita Patterson in consideration for services as our directors
and officers. We relied on an exemption from registration under the
Securities Act of 1933 by reason of Section 4(2) as a private transaction not
involving a public distribution. Mr. Mayer and Ms. Patterson had access to
the same kind of information as would be available in a registration statement
regarding Globalwise and Globalwise reasonably believed they possessed
sufficient sophistication to evaluate the information provided.
On July 18, 2000, we issued 28,000 shares valued at $15,000 to Mutual
Ventures Corporation for investment banking services and costs advanced on our
behalf. The issuance of such shares was exempt from registration under the
Securities Act by reason of Section 4(2) as a private transaction not
involving a public distribution. We relied on an exemption from registration
under the Securities Act of 1933 by reason of Section 4(2) as a private
transaction not involving a public distribution. Mutual Ventures Corporation
was provided the same kind of information as would be available in a
registration statement regarding Globalwise and Globalwise reasonably believed
it possessed sufficient sophistication to evaluate the information provided.
ITEM 5: INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to Nevada Revised Statutes Section 78.7502 and 78.751 we may
indemnify any person who is our director, officer, employee or agent and may
establish criteria for authorization of discretionary indemnification. Our
Articles of Incorporation and bylaws provide for the indemnification of
present and former directors, officers and employees. Such individual must
have conducted himself in good faith and reasonably believed that his conduct
was in, or not opposed to, our best interests. In a criminal action he must
not have had a reasonable cause to believe his conduct was unlawful. We will
reimburse such individual against all legal and other expenses incurred in an
action or proceeding brought because such individual is our director, officer
or employee. We will not indemnify an individual adjudged liable to us due to
negligence or wilful misconduct.
PART F/S
INDEX TO FINANCIAL STATEMENTS
Globalwise Investments, Inc.
Financial Statements
September 30, 2000 (unaudited),
June 30, 2000 and December 31, 1999
C O N T E N T S
Independent Auditors' Report............................................ 3
Balance Sheets.......................................................... 4
Statements of Operations................................................ 5
Statements of Stockholders' Equity....................................... 6
Statements of Cash Flows................................................ 8
Notes to the Financial Statements....................................... 9
<PAGE> 12
CHISHOLM & ASSOCIATES
Certified Public Accountants
P.O. Box 540216
North Salt Lake, Utah 84054-0216
Office (801) 292-8756
Fax (801) 292-8809
______________________________________________________________________________
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
of Globalwise Investments, Inc.
We have audited the accompanying balance sheet of Globalwise Investments, Inc.
(a development stage company) as of June 30, 2000 and the related statements
of operations, stockholders' equity and cash flows for the period then ended.
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 audits. The financial statements of Globalwise Investments, Inc.
for the years ended December 31, 1999 and 1998 and from inception on October
3, 1997 through December 31, 1999 were audited by other auditors whose report
dated February 10, 2000 expressed an unqualified opinion
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
statement 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 Globalwise Investments, Inc.
(a development stage company) as of June 30, 2000 and December 31, 1999 and
the results of its operations and cash flows for the six months ended June 30,
2000, for the years ended December 31, 1999, 1998 and from inception on
October 3, 1997 through June 30, 2000 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. The Company has suffered recurring
losses from operations which raises substantial doubt about its ability to
continue as a going concern. Management's plans in regard to these matters
are described in Note 2. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/ Chisholm & Associates
Salt Lake City, Utah
June 30, 2000
<PAGE> 13
Globalwise Investments, Inc.
(A Development Stage Company)
Balance Sheets
ASSETS
September 30, June 30, December 31,
2000 2000 1999
------------- ------------ ------------
(Unaudited)
Cash(Note 1) $ - $ - $ 1,531
Inventory (Note 1) - - 21,744
------------- ------------ ------------
Total Current Assets - - 23,275
------------- ------------ ------------
Equipment, net (Note 1) $ - $ - $ 39,630
------------- ------------ ------------
TOTAL ASSETS $ - $ - $ 62,905
============= ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable 1,345 1,345 -
Accounts payable - related party - - 599
------------- ------------ ------------
Total Liabilities 1,345 1,345 599
------------- ------------ ------------
STOCKHOLDERS' EQUITY
Common stock, $.001 par value;
50,000,000 shares authorized;
850,000, 802,000 and 952,000
shares issued and outstanding,
respectively 850 802 952
Additional Paid in Capital 47,494 27,542 89,698
Deficit Accumulated during the
development stage (49,689) (29,689) (28,344)
------------- ------------ ------------
Total Stockholders' Equity (1,345) (1,345) 62,306
------------- ------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ - $ - $ 62,905
============= ============ ============
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE> 14
Globalwise Investments, Inc.
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
From
For the For the Inception on
Nine Months Six Months For the Years Ended October 3,
Ended Ended December 31, 1997 to
September 30, June 30, ------------------------- September 30,
2000 2000 1999 1998 2000
------------ ------------ ------------ ------------ ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
------------ ------------ ------------ ------------ ------------
EXPENSES
General & Administrative 21,345 1,345 27,794 550 49,689
------------ ------------ ------------ ------------ ------------
TOTAL EXPENSES 21,345 1,345 27,794 550 49,689
------------ ------------ ------------ ------------ ------------
NET INCOME (LOSS) $ (21,345) $ (1,345) $ (27,794) $ (550) $ (49,689)
============ ============ ============ ============ ============
LOSS PER SHARE $ (.03) $ - $ (0.04) $ - $ (0.09)
============ ============ ============ ============ ============
WEIGHTED AVERAGE SHARES OUTSTANDING 849,500 852,000 625,000 300,000 524,587
============ ============ ============ ============ ============
The accompanying notes are an integral part of these financial statements.
-5-
</TABLE>
<PAGE> 15
<TABLE>
<CAPTION>
Globalwise Investments, Inc.
(A Development Stage Company)
Statements of Stockholders' Equity
From Inception on October 3, 1997 through September 30, 2000
Deficit
Accumulated
Additional During the
Common Stock Paid-in Development
Shares Amount Capital Stage
------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Balance, October 3, 1997 - $ - $ - $ -
Issuance of shares for equipment
at $0.064 per share 300,000 300 18,800 -
Net (loss) for the year
ended December 31, 1997 - - - -
------------- ------------ ------------- -------------
Balance - December 31, 1997 300,000 300 18,800 -
Capital Contributions - - 550 -
Net (loss) for the year
ended December 31, 1998 - - - (550)
------------- ------------ ------------- -------------
Balance - December 31, 1998 300,000 300 19,350 (550)
Issuance of shares for cash at
$0.0996 per share 652,000 652 64,348 -
Capital Contributions - - 6,000 -
Net (loss) for the year
ended December 31, 1999 - - - (27,794)
------------- ------------ ------------- -------------
Balance - December 31, 1999 952,000 952 89,698 (28,344)
Cancellation of shares in
connection with spin-off of
Assets and Liabilities of
the Company (150,000) (150) (62,156) -
Issuance for services at $.25
per share 20,000 20 4,980 -
Issuance for services at $.536
per share 28,000 28 14,972 -
Net (loss) for the nine months
ended September 30, 2000 - - - (21,345)
------------- ------------ ------------- -------------
Balance - September 30, 2000 850,000 $ 802 $ 47,494 $ (49,689)
============= ============ ============= =============
The accompanying notes are an integral part of these financial statements.
-6-
</TABLE>
<PAGE> 16
<TABLE>
<CAPTION>
Globalwise Investments, Inc.
(A Development Stage Company)
Statements of Cash Flows
From
For the For the Inception on
nine months six months For the years ended October 3,
ended ended December 31, 1997 Through
September 30, June 30, ------------------------- September 30,
2000 2000 1999 1998 2000
------------ ------------ ------------ ------------ ------------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C> <C>
Cash Flows From Operating Activities
Net loss $ (21,345) $ (1,345) $ (27,794) $ (550) $ (49,689)
Less non-cash items:
Stock issued for services 20,000 - - - 20,000
Capital contributions-expenses - - 6,000 550 6,550
(Increase) decrease in inventory - - (21,744) - (21,744)
Increase (decrease) in
accounts payable 1,345 1,345 599 - 1,944
------------ ------------ ------------ ------------ ------------
Net Cash Provided (Used) by
Operating Activities - - (42,939) - (42,939)
------------ ------------ ------------ ------------ ------------
Cash Flows from Investing Activities
Purchase of equipment - - (20,530) - (20,530)
Loss of cash in spin-off (1,531) (1,531) - - (1,531)
------------ ------------ ------------ ------------ ------------
Net Cash Provided (Used) by
Investing Activities (1,531) (1,531) (20,530) - (22,061)
------------ ------------ ------------ ------------ ------------
Cash Flows from Financing Activities
Proceeds from stock issuance - - 65,000 - 65,000
------------ ------------ ------------ ------------ ------------
Net Cash Provided (Used) by
Financing Activities - - 65,000 - 65,000
------------ ------------ ------------ ------------ ------------
Increase (Decrease) in Cash (1,531) (1,531) 1,531 - -
------------ ------------ ------------ ------------ ------------
Cash and Cash Equivalents at
Beginning of Period 1,531 1,531 - - -
------------ ------------ ------------ ------------ ------------
Cash and Cash Equivalents at
End of Period $ - $ - $ 1,531 $ - $ -
============ ============ ============ ============ ============
Supplemental Non-Cash
Financing Transactions:
Stock issued for services $ 20,000 $ - $ - $ - $ 20,000
Cash paid for:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
The accompanying notes are an integral part of these financial statements.
-7-
</TABLE>
<PAGE> 17
Globalwise Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 1 - Summary Of Significant Accounting Policies
a. Organization
Globalwise Investments, Inc. (the Company) was organized under the laws of
the state of Utah on October 3, 1997. The Company was organized for the
purpose of engaging in the confectionary vending machine business.
b. Recognition of Revenue
The Company recognizes income and expense on the accrual basis of
accounting.
c. Earnings (Loss) Per Share
The computation of earnings per share of common stock is based on the
weighted average number of shares outstanding at the date of the financial
statements.
d. Cash and Cash Equivalents
The company considers all highly liquid investments with maturities of
three months or less to be cash equivalents.
e. Provision for Income Taxes
No provision for income taxes have been recorded due to net operating loss
carryforwards totaling approximately $29,700 that will be offset against
future taxable income. These NOL carryforwards will begin to expire in the
year 2019. No tax benefit has been reported in the financial statements
because the Company believes there is a 50% or greater chance the carryforward
will expire unused.
-8-
<PAGE> 18
Globalwise Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 1 - Summary Of Significant Accounting Policies (continued)
Deferred tax asset and the valuation account is as follows at June 30,
2000 and, December 31, 1999:
June 30, December 31,
2000 1999
------------ -------------
Deferred tax asset:
NOL carryforward $ 10,000 $ 9,600
Valuation allowance (10,000) (9,600)
------------ -------------
$ - $ -
============ =============
f. Inventory
The inventory presented at December 31, 1999 consists of confectionary
items for sale, contained in the vending machines outlined below.
g. Equipment
The equipment consists of confectionary vending machines located in
several locations within Salt Lake County, Utah. The machines were put into
service during January 2000 and were to be depreciated over seven years using
the straight line method. However, the Company exchanged the equipment for
common stock (see Note 3) and has no equipment at June 30, 2000.
h. Use of estimates
The preparation of 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
statement and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 2 - Going Concern
The accompanying financial statements have been prepared assuming that the
company will continue as a going concern. The company has had recurring
operating losses for the past several years and is dependent upon financing to
continue operations. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty. It is management's
plan to find an operating company to merge with, thus creating necessary
operating revenue.
-9-
<PAGE> 19
Globalwise Investments, Inc.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 3 - Spin-off
In March 2000, the Company exchanged all of its assets and liabilities
for 150,000 shares of its previously issued common stock. The shares were
subsequently canceled.
NOTE 4 - Development Stage Company
The Company is a development stage company as defined in Financial
Accounting Standards Board Statement No. 7. It is concentrating substantially
all of its efforts in raising capital and searching for a business operation
with which to merge, or assets to acquire, in order to generate significant
operations.
NOTE 5 - Stock Split
In June 1999, the Company completed a forward stock split of 50 shares
for each outstanding share. This report has been prepared showing after stock
split shares from inception.
NOTE 6 - Stockholders' Equity
In July 2000, the Company issued 20,000 shares of common stock for
services valued at $5,000.
In July 2000, the Company issued 28,000 shares of common stock for
services valued at $15,000.
NOTE 7 - Unaudited Information
Globalwise Investments, Inc. (the Company) has elected to omit
substantially all footnotes to the financial statements for the nine months
ended September 30, 2000. The information furnished herein was taken from the
books and records of the Company without audit. However, such information
reflects all adjustments which are, in the opinion of management, necessary to
properly reflect the results of the nine months ended September 30, 2000, and
are of a normal, recurring nature. The information presented is not
necessarily indicative of the results from operations expected for the full
fiscal year.
-10-
<PAGE> 20
PART III
ITEM 1: INDEX TO AND DESCRIPTION OF EXHIBITS
Exhibit
Number Description
------- -----------
3.1 Articles of Incorporation, dated July 12, 2000 (filed October 2,2000)
3.2 Articles of Merger, dated July 21, 2000 (filed October 2, 2000)
3.3 Bylaws of Globalwise (filed October 2, 2000)
16.1 Letter of agreement from Andersen, Andersen & Strong LC, dated
December 13, 2000
16.2 Letter of agreement from Crouch, Bierwolf & Chisholm, dated December
11, 2000
27 Financial Data Schedule
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, who is duly authorized.
12/14/00
Date_________________________ Globalwise Investments, Inc.
/s/ Don Mayer
By: _______________________________
Don Mayer, President
