As filed with the Securities and Exchange Commission on May 1, 2000
Registration Statement No. 333-72385
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT TO FORM SB-2
AS FILED ON
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------------------
GLOBALNET FINANCIAL.COM, INC.
(Name of Small Business Issuer in Its Charter)
Delaware 7375 06-1489574
(State or Jurisdiction of (Primary Standard (IRS Employer
Incorporation or Industrial Classification Identification Number)
Organization) Code Number)
7284 W. Palmetto Park Road
Suite 210
Boca Raton, Florida 33433
(561) 417-8053
(Address and Telephone Number of Principal Executive Offices)
7284 W. Palmetto Park Road, Suite 210, Boca Raton, Florida 33433
(Address of principal place of business or intended principal place of business)
Michael S. Jacobs
GlobalNet Financial.com, Inc.
7284 W. Palmetto Park Road
Suite 210
Boca Raton, Florida 33433
(561) 417-8053
(Name, Address and Telephone Number of Agent for Service)
COPIES OF COMMUNICATIONS TO:
Leonard H. Bloom, P.A.
Broad and Cassel
201 South Biscayne Boulevard
Suite 3000
Miami, Florida 33131
Telephone No. (305) 373-9400
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, please check the following box. [X]
================================================================================
This Registration Statement serves as a post-effective amendment to the
Company's Registration Statement on Form SB-2, SEC Registration No. 333-72385.
---------------------------------------
<PAGE>
5,242,154 SHARES
[LOGO]
GLOBALNET FINANCIAL.COM, INC.
COMMON STOCK
-----------------
The selling stockholders are offering for sale up to 5,242,154 shares
of common stock which includes 375,834 shares underlying certain warrants. We
are registering the re-sale of the shares of common stock pursuant to
commitments to these stockholders. We will pay the expenses of registering the
re-sale of the shares.
The selling stockholders may sell their shares in public or private
transactions, at prevailing market prices or at privately negotiated prices. We
will not receive any proceeds from the sales of the shares, but will receive
approximately $6,191,260 from the exercise of the warrants, if all of the
warrants are exercised.
-----------------
The common stock is quoted on the Nasdaq National Market under the
symbol "GLBN." The last reported sale price of the common stock on the Nasdaq
National Market on April 27, 2000, was $23.50 per share.
- -----------------
INVESTING IN THE COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE
"RISKS OF INVESTING IN OUR SHARES" BEGINNING ON PAGE 3.
- -----------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- -----------------
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(c),
may determine.
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TABLE OF CONTENTS
PAGE
FORWARD-LOOKING STATEMENTS..................................................iii
PROSPECTUS SUMMARY............................................................1
RISKS OF INVESTING IN OUR SHARES..............................................3
PROCEEDS FROM SALE OF THESE SHARES............................................9
SELLING STOCKHOLDERS ........................................................11
HOW THE SHARES MAY BE DISTRIBUTED............................................13
LEGAL OPINION................................................................14
EXPERTS......................................................................14
WHERE YOU CAN FIND MORE INFORMATION..........................................14
INCORPORATION OF COMMON INFORMATION BY REFERENCE.............................15
INDEMNIFICATION OF DIRECTORS AND OFFICERS....................................16
-----------------------------------
As used in this prospectus, the terms "we," "us," "our," the "Company"
and "GlobalNet" mean GlobalNet Financial.com, Inc. and its subsidiaries (unless
the context indicates a different meaning), and the term "common stock" means
GlobalNet's common stock, $0.001 par value per share.
You should rely only on the information contained in this prospectus.
We have not authorized anyone to provide you with information different from
that which is contained in this prospectus. We are offering to sell shares of
common stock and seeking offers to buy shares of common stock only in
jurisdictions where offers and sales are permitted. The information contained in
this prospectus is accurate only as of the date of this prospectus, regardless
of the time of delivery of this prospectus or of any sale of the common stock.
FORWARD-LOOKING STATEMENTS
We caution readers that certain important factors may affect our actual
results and could cause such results to differ materially from any
forward-looking statements which may be deemed to have been made in this
prospectus or which are otherwise made by us or on our behalf. For this purpose,
any statements contained in this prospectus that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the generality of the foregoing, words such as "may", "will", "expect",
"believe", "anticipate", "intend", "could", "would", "estimate", or "continue"
or the negative other variations thereof or comparable terminology are intended
to identify forward-looking statements. Factors that may affect the Company's
results include, but are not limited to, the Company's limited operating history
and prior operating losses and accumulated deficit, the Company's dependence on
advertising revenue and
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<PAGE>
sponsorship, the uncertainty associated with the Internet both in the United
States and abroad, the Company's reliance on management, and the Company's
possible inability to compete in the advertising and domestic or international
Internet industries. We are also subject to other risks detailed herein or
detailed from time to time in our filings with the U.S. Securities and Exchange
Commission.
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<PAGE>
PROSPECTUS SUMMARY
THIS IS ONLY A SUMMARY AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT
MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE MORE DETAILED INFORMATION CONTAINED
IN THIS PROSPECTUS AND ALL OTHER INFORMATION, INCLUDING THE FINANCIAL
INFORMATION AND STATEMENTS WITH NOTES, REFERRED TO IN THIS PROSPECTUS AS
DISCUSSED IN THE "WHERE YOU CAN FIND MORE INFORMATION" SECTION OF THIS
PROSPECTUS.
ABOUT GLOBALNET
We are a rapidly expanding international financial portal providing
online financial news, investment tools, and transaction services. We are
developing a global network of country-centric financial content websites in
local market language as well as a network of transaction execution platforms,
in order to position ourselves as an international financial services provider.
Our business model is to capture traffic for our financial content sites as a
result of partnering with leading Internet players and then to drive visitors
from our highly trafficked financial content websites to our network of
transaction execution platforms in which we maintain substantial ownership
interests. In this manner, we seek to dramatically reduce our user and account
acquisition costs.
We conduct our financial content operations predominantly as the
exclusive provider of financial content and in certain cases the exclusive
provider of financial services for leading Internet Service Providers and
portals. These services are provided by us as the "Money Channel" for the
Internet Service Providers or portals. As a result, when a user clicks on the
"Money Channel" button on a host Internet Service Provider's or portal's home
page, the user is linked to our website. We provide Money Channel services to
Freeserve plc, the United Kingdom's leading Internet Service Provider, World
Online, the largest pan-European Internet Service Provider and portal and
Scandinavia OnLine, the dominant consumer Internet portal across Scandinavia. We
currently operate, directly or through joint ventures, financial content
websites focusing on the financial market of the United Kingdom, the United
States, Italy, Canada, France, Denmark and Holland. We have also entered into an
agreement to provide financial news, content and e-finance commerce platforms,
including online trading, to British Telecommunication's network of Wireless
Application Protocol mobile phone users.
Our websites are designed to generate online trading of securities and
other investment products. We are creating an international network of online
transaction businesses in which we maintain substantial equity ownership
interests, including online trading for North American and European stocks,
foreign exchange and other financial services, such as insurance. We have
launched www.GlobalNeTrader.com, our platform for the online trading of United
States securities, www.Matchbookfx.com for global foreign exchange trading and
www.InsuranceWide.com, offering a full spectrum of insurance products in the
United Kingdom. We anticipate launching our online securities trading and
clearing platforms for the United Kingdom and Canada this spring. Management is
currently developing additional websites and online trading platforms.
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We seek to participate in the dramatic growth in the Internet and
Technology industries, and, to this end, we have made several investments in
Internet and technology companies as well as Internet and technology funds. In
most cases these investments are in conjunction with joint ventures and business
relationships. We recently formed a digital commerce and knowledge-based
industries investment and operating vehicle, GlobalEuroNet Group, Inc., in which
we invested $3.2 million for approximately 2.8 million shares or a 24% equity
interest. GlobalEuroNet Group, Inc. subsequently raised approximately $42
million from other sources.
Our business model consists of generating revenues from our online
trading platform as well as from advertising and e-commerce and participating in
the earnings of the other transaction execution platforms in which we maintain
ownership interests. In addition, we are seeking to create stockholder and
balance sheet value as a result of creating joint ventures with, and/or
investments in, companies which have the ability to become public or be sold
over the short term.
Management believes that the opportunities open to us are driven by the
following principal factors:
/bullet/ an anticipated continued rapid growth in usage of the Internet
nationally and internationally;
/bullet/ an increasing acceptance of the Internet as a secure medium
through which to conduct e-commerce;
/bullet/ an increasing world-wide demand for financial news,
information and investment tools; and
/bullet/ the positioning of the company to capitalize upon the
anticipated growth in the number of online financial
transactions in the United Kingdom and continental Europe.
THE OFFERING
The selling stockholders are offering for sale up to 5,242,154 shares
of common stock which includes 375,834 shares underlying certain warrants. We
are registering the re-sale of the shares of common stock pursuant to
commitments to these stockholders. We will pay the expenses of registering the
re-sale of the shares.
The selling stockholders may sell their shares in public or private
transactions, at prevailing market prices or at privately negotiated prices. We
will not receive any proceeds from the sales of the shares, but will receive
approximately $6,191,260 from the exercise of the warrants, if all of the
warrants are exercised.
-----------------------------------
The principal executive offices of the Company are located at 7284 W.
Palmetto Park Road, Suite 210, Boca Raton, Florida 33433, and its telephone
number is (561) 417-8053.
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RISKS OF INVESTING IN OUR SHARES
YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING RISKS BEFORE MAKING AN
INVESTMENT DECISION. THE TRADING PRICE OF OUR COMMON STOCK COULD DECLINE DUE TO
ANY OF THESE RISKS, AND YOU COULD LOSE ALL OR PART OF YOUR INVESTMENT. YOU ALSO
SHOULD REFER TO THE OTHER INFORMATION SET FORTH IN THIS PROSPECTUS, INCLUDING
OUR COMBINED FINANCIAL STATEMENTS AND THE RELATED NOTES THERETO. THESE ARE NOT
THE ONLY RISKS AND UNCERTAINTIES THAT WE FACE. ADDITIONAL RISKS AND
UNCERTAINTIES THAT WE DO NOT CURRENTLY KNOW ABOUT OR THAT WE CURRENTLY BELIEVE
ARE IMMATERIAL MAY ALSO HARM OUR BUSINESS OPERATIONS. IF ANY OF THESE RISKS OR
UNCERTAINTIES ACTUALLY OCCUR, OUR BUSINESS, RESULTS OF OPERATIONS, FINANCIAL
CONDITION, RESULTS OF OPERATIONS OR PROSPECTS COULD BE MATERIALLY ADVERSELY
AFFECTED. IN SUCH CASE, THE TRADING PRICE OF OUR COMMON STOCK COULD DECLINE, AND
YOU MAY LOSE ALL OR PART OF YOUR INVESTMENT.
WE HAVE A LIMITED OPERATING HISTORY IN THE AREA OF ONLINE FINANCIAL SERVICES.
We have been engaged in the current Internet business since October
1998. Many of our investments in international joint ventures are in an early
stage of development. We have little operating history in the Internet business
upon which our performance and prospects can be evaluated. We face the risks
frequently encountered by developing companies. These risks include the
potential inability to compete with more established firms and to retain and
maintain key personnel, as well as uncertainty as to which areas to target for
growth and expansion and as to the source of funding for operations and
expansion.
WE HAVE A LIMITED OPERATING HISTORY IN THE AREA OF ONLINE TRADING.
We anticipate deriving a significant portion of our revenues from
online transaction executions. We have only recently introduced online trading
in foreign exchanges and domestic securities and we plan to offer online trading
in non-US securities. In addition, we plan to offer other investment and
financial products. Lack of international online trading and transaction
execution operating history and the risks inherent in any new business area make
it impossible accurately to predict the extent of revenues to be generated from
these activities.
ADVERTISING REVENUES AND SPONSORSHIPS ARE UNCERTAIN.
We anticipate deriving revenues from the sale of domestic and
international Internet-based advertising. None of our senior management team has
any significant experience in selling advertising on the Internet or any other
medium. If we are unable to attract and retain paying advertising customers or
if we are forced to offer lower than anticipated advertising rates in order to
attract and/or retain advertising customers, our anticipated level of
advertising revenue will be adversely affected.
Use of the Internet by overseas consumers is at an early stage of
development and international market acceptance of the Internet as a medium for
information, commerce and advertising is subject to a high level of uncertainty.
In order for us to generate advertising revenues, European advertisers and
advertising agencies must direct a portion of their budgets to the Internet as a
whole, and specifically to our Internet sites. Our management believes that most
international and specifically, European advertisers and advertising agencies
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have limited experience with the Internet as an advertising medium and
international and specifically, European advertisers have not devoted a
significant portion of their advertising budgets to Internet-related advertising
to date. Our management cannot assure investors that international and
specifically, European advertisers or advertising agencies, will be persuaded,
or able, to allocate or continue to allocate portions of their budgets to
Internet-based advertising, that they will find Internet-based advertising to be
more effective than advertising in traditional media, or that they will decide
to advertise on our Internet sites.
WE ARE DEPENDENT ON CONTINUED GROWTH OF THE INTERNET.
Rapid growth in the use of and interest in the Internet is a recent
phenomenon. Our management cannot assure that acceptance and use of the Internet
will continue to develop or that a sufficient base of users will emerge to
support its business. Revenues from our Internet operations will depend largely
on the widespread acceptance and use of the Internet as a source of information
and as a vehicle for commerce in goods and services, especially online financial
and investment transactions. If use of the Internet does not continue to grow or
grows more slowly than expected, or if the Internet infrastructure does not
effectively support growth that may occur, our business will be adversely
affected.
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WE ARE DEPENDENT ON THIRD PARTIES FOR INTERNET OPERATIONS AND CONTENT
DEVELOPMENT.
Management believes that the ability to advertise our Internet sites
and online transaction capabilities on other Internet sites and the willingness
of the owners and operators of such sites to direct users to our Internet sites
through hypertext links are critical to the success of our Internet operations.
Other Internet sites, particularly search/index guides and other companies with
the strategic ability to direct user traffic, significantly affect traffic to
our domestic and international Internet sites. While the Company's management
believes that other sites will direct traffic to the Company's sites, we cannot
assure that the Company will establish or maintain such arrangements in the
future.
In particular, the Company is dependent on its ongoing relationships
with Freeserve plc, World Online, and Scandinavia Online, three international
prominent providers of Internet access to consumers.
Our ability to develop original and compelling Internet-based products
and services is also dependent on maintaining relationships with and using
content and products provided by third-party vendors. Developing and maintaining
satisfactory relationships with third parties could become more difficult and
more expensive as competition increases among Internet sites. If we are unable
to develop and maintain satisfactory relationships with such third parties on
terms acceptable to them, or if any competitors are better able to leverage such
relationships, our business will be harmed. Our business is dependent on third
parties for uninterrupted Internet access.
ACQUISITIONS AND JOINT VENTURES MAY DISRUPT OR OTHERWISE HAVE A NEGATIVE IMPACT
ON OUR BUSINESS.
We intend to enter into new business opportunities and ventures as part
of our Internet business. Typically, such opportunities require extended
negotiations, the investment of a substantial amount of capital and substantial
burdens on our management personnel and our financial and operational systems.
We cannot assure investors that such ventures will ever achieve profitability.
WE ARE SUBJECT TO TECHNOLOGICAL CHANGES.
The market for Internet-based products and services is characterized by
rapid technological developments and frequent Internet product introductions.
The emerging character of these products and services and their rapid evolution
will require that we continually improve the performance, features and
reliability of our Internet-based products and services. We cannot assure
investors that we will be successful in responding quickly, cost effectively and
sufficiently to these developments.
In addition, the widespread adoption of new Internet technologies or
standards could require us to make substantial expenditures and to modify or
adapt our Internet site and services that could harm our business. In addition,
new Internet-based products, services or enhancements offered by us may contain
design flaws or other defects that could require costly modifications or result
in a loss of consumer confidence, either of which could harm our business.
The satisfactory performance, reliability, and availability of our
Internet sites and our computer network infrastructure are critical to
attracting Internet users. System interruptions
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which result in the unavailability of our Internet sites or slower response
times for users reduce the attractiveness of our Internet sites to users and
could harm our business.
OUR INTELLECTUAL PROPERTY RIGHTS MAY BE CHALLENGED.
We are developing proprietary Internet software and have filed
applications for certain trademarks, trade names, service marks, domain names
and other proprietary rights which we either currently have or may have in the
future and which we believe to be important to our Internet business. Even
though we have registered some domain names, given the uncertain application of
existing copyright and trademark laws to the Internet, we cannot assure
investors that existing laws will provide adequate protection for our
technologies, sites or registered domain names. Policing unauthorized use of our
technologies, content and other intellectual property rights entails significant
expenses and could otherwise be difficult or impossible to do, given, among
other things, the global nature of the Internet. From time to time, we may be
subject to legal proceedings and claims in the ordinary course of business,
including claims of alleged infringement of the trademarks and other
intellectual property of third parties by us or our licensees. Such claims, even
if not meritorious, could result in the expenditure of significant financial and
managerial resources.
THERE ARE SUBSTANTIAL RISKS IN FOREIGN MARKETS.
We have entered into agreements with joint venture partners and
strategic alliances to conduct our Internet business outside of the United
States. Our inability to find additional joint venture partners could slow down
our anticipated overseas growth. If we do not find a suitable joint venture
partner in a given foreign market, we may not enter that market. Conducting
business outside the United States will require us to become familiar with and
to comply with foreign laws, rules, regulations and customs. We cannot be
certain that our failure to comply with foreign laws, rules and regulations of
which we are not aware will not harm our business.
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Further risks are inherent in international operations, including the
following:
/bullet/ differing levels of Internet use in other countries;
/bullet/ customers agreements may be difficult to enforce and
receivables difficult to collect through a foreign country's
legal system;
/bullet/ foreign countries may impose additional withholding taxes or
otherwise tax the Company's foreign income, impose tariffs or
adopt other restrictions on foreign trade or investment;
/bullet/ intellectual property rights may be more difficult to enforce
in foreign countries;
/bullet/ fluctuations in exchange rates may affect product demand and
may adversely affect the profitability in US dollars of
products and services made in the local currency;
/bullet/ general economic conditions in the countries in which we
operate could have an adverse effect on our earnings from
operations in those countries;
/bullet/ unexpected changes in foreign laws or regulatory requirements
may occur; and
/bullet/ compliance with a variety of foreign laws and regulations and
the overlap of different tax structures may be costly and time
consuming.
Tax rates in certain foreign countries may exceed those of the United
States and foreign earnings may be subject to withholding requirements or the
imposition of tariffs, exchange controls or other restrictions. There can be no
assurance that any of these factors will not have a material adverse effect on
our business and results of operations.
WE ARE SUBJECT TO EVOLVING INTERNET REGULATIONS.
New laws, guidelines and regulations may be adopted covering areas such
as access, content, taxation, encryption, communications and pricing and quality
of Internet products, services and online trading. As a provider of Internet
products and services, we may be subject to the provisions of existing and
future laws, guidelines and regulations that could be applied to our operations.
Such laws, guidelines and regulations could limit the growth of the Internet and
harm our business.
WE ARE SUBJECT TO ONGOING SECURITIES REGULATION IN THE UNITED STATES AND
OVERSEAS.
The securities industry in the United States and other countries is
subject to extensive regulation under both federal and state laws. In the United
States, the Securities and Exchange Commission, state securities commissions,
National Association of Securities Dealers, Inc. and other self-regulatory
organizations such as the various stock exchanges, require strict compliance
with their rules and regulations. Broker-dealers are subject to regulations
covering all aspects of the securities business, including sales methods, trade
practices among broker-dealers, use and safekeeping of clients' funds and
securities, capital structure, recordkeeping and the conduct of directors,
officers and employees and the maintenance of certain levels of capital. We will
also be subject to regulation by foreign governments of any foreign
broker-dealers associated with us and will be subject to the foreign rules and
regulations pertaining to the trading of foreign equity in overseas markets.
Failure to comply with any of these laws, rules or regulations could result in
censure, fine, the issuance of cease-and-desist orders or the suspension or
expulsion of a broker-dealer or any of its officers or employees, any of which
could harm our business.
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WE ARE SUBJECT TO CONTINUING CURRENCY EXCHANGE RISKS.
A proportion of our revenues are received in non-US currencies. We
anticipate that in the future an increasing proportion of our revenues will be
received in Euro dollars. This may give rise to an exchange risk against US
dollars.
The introduction of the Euro dollar may have a wide range of
macro-economic effects, resulting, among other things, in interest rates, levels
of economic activity and asset values being different from what they would
otherwise have been. We are unable to predict these macro-economic effects or
their impact on the demand for our services or on our revenues or costs.
We may engage from time to time in foreign exchange hedging in respect
of the principal foreign currencies in which our receivables are denominated.
There can be no assurance that such hedging activities will continue or will be
effective to limit the impact of any movements in exchange rates on our results
or operations.
THE WEB SITES, STATISTICS AND RATINGS FROM EUROPE MAY NOT BE COMPREHENSIVE OR
RELIABLE.
The measurement of Internet traffic and statistics in Europe is not as
sophisticated or developed as it is in the United States. To our knowledge,
European ratings come from a "representative sample" of a small sampling of
European households. To illustrate, Media Matrix, a company used by Merrill
Lynch to track European usage of the Internet, tracks only 1,230 households in
the United Kingdom to determine usage statistics in the United Kingdom. This
information is tracked on software installed in individual households of
Internet users. As a result, the sampling data used to derive Internet use is
compiled from a limited number of actual users. In addition, only those Internet
users who access the Internet from their home computers are tracked while
Internet usage at a business site is not tracked. We believe that if business
usage in addition to household usage were tracked, the estimated number of
monthly users, frequency of use per user and average minutes per visit per user
would increase in sampling data. Finally, the statistics used by tracking meters
in Europe use slightly different definitions in interpreting their measurements.
For example, the United States measurements include the estimated number of
people who access a site once a month (defined as "users") in contrast with the
European measurement of a percentage of all online users who access a site or
network of sites at least once during a month (referred to as "reach").
Accordingly, the measurements of Internet use is not as accurate or as
comprehensive in Europe. Management believes that the statistics quoted
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herein from Europe, while not fully comprehensive or reliable as the tracking
statistics used in the United States, are still useful for valuation and trend
analysis. Our management believes that the statistical estimates of the number
and frequency of Internet users in Europe that are used by advertising agencies,
investors and the online companies themselves will increase as the tracking
capacity in Europe becomes more reliable, tracks larger samplings and tracks
business as well as households.
WE ARE DEPENDENT ON KEY PERSONNEL.
Our business depends upon the services of its executives and certain
key personnel, including Stanley Hollander, President, Chief Executive Officer
and Chairman of the Board of Directors; Alan L. Jacobs, Executive Vice
President; William Hodgson, Chief Operating Officer; Michael S. Jacobs, Chief
Financial Officer; Jay J. Matulich, Senior Vice President and Richard Hefter,
Editor-in-Chief. We cannot be certain that we will be able successfully to
attract and retain key personnel. The loss of the services of any one or more of
such key personnel or the inability to attract such key personnel could harm our
business. Currently we do not maintain key man life insurance on any of our
executives or key personnel. We cannot be certain that such officers and
directors will remain our employees in any particular capacity.
THERE ARE RISKS ASSOCIATED WITH THE SECURITIES INDUSTRY.
The securities business is volatile and is directly affected by the
following factors, among others, many of which are beyond our control.
/bullet/ national and international political and economical
conditions;
/bullet/ broad trends in business and finance;
/bullet/ fluctuations in volume and price levels of securities
transactions;
/bullet/ client default on commitments (such as margin obligations);
/bullet/ litigation;
/bullet/ employee's misconduct, errors and omissions;
/bullet/ regulation at federal and state levels;
/bullet/ the emergence of numerous discount brokers;
/bullet/ increased use of technology; and
/bullet/ a steady decrease in the commissions charged to clients of
discount brokerage services.
Losses associated with these risks could harm our business.
PROCEEDS FROM SALE OF THE SHARES
We will not receive any proceeds from the sale of the shares offered by
the selling stockholders. We will receive proceeds only upon the exercise of the
warrants for which we are registering the underlying shares of common stock, if
these warrants are exercised. We would receive approximately $6,191,260 from the
exercise of the warrants assuming all of the warrants were exercised. We cannot
assure you as to when, if ever, any or all of such warrants will be
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exercised. Proceeds, if any, received from the exercise of the warrants will be
used for working capital requirements and other general corporate purposes.
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SELLING STOCKHOLDERS
We have been advised by the selling stockholders that none of the
selling stockholders has or had a position, office or other material
relationship with us or any of our affiliates within the past three years.
Unless otherwise indicated, the following table sets forth certain information
with respect to the ownership of our common stock by each selling stockholder as
of the date of this prospectus.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED BEFORE/AFTER THE
OFFERING(1)
--------------------------------------------
NAME OF SELLING STOCKHOLDER Number of
- --------------------------- Shares of common Percentage of shares Number of shares of
stock beneficially of common stock common stock
owned beneficially owned(2) registered
<S> <C> <C> <C>
Freeserve Ltd. 1,397,112 9.49% 1,397,112
National Bank of Canada 325,000(3) 2.20% 325,000(3)
Giant Trading Inc. 302,500 2.05% 302,500
Robert S. London 271,900 1.85% 271,900
Rush & Co. 225,720 1.53% 225,720
Rosebud Capital Growth Fund Limited 209,168 1.42% 209,168
Kingston Comercio Internacional LDA 208,334 1.42% 208,334
De Agostini Holding Lugano Branch 208,334 1.42% 208,334
Alan Gaines 205,167 1.39% 205,167
Archdream Limited 203,400 1.38% 203,400
Cass & Co. Magnum US Equity Fund 200,000 1.36% 200,000
Cass & Co. Magnum Capital Growth Fund 186,667 1.27% 186,667
Interactive Marketing, Inc. 140,000(4) * 140,000(4)
Cass & Co. Magnum Turbo Growth Fund 133,334 * 133,334
Cass & Co. Magnum Edge Fund 133,334 * 133,334
Katrinia Tarizzo 83,334 * 83,334
Del Mar Group 75,000 * 75,000
Napier Brown Holdings 68,750 * 68,750
Robert B. Prag 66,667 * 66,667
Cass & Co. Magnum Global Equity Fund 66,667 * 66,667
Salahi Ozturk 60,000 * 60,000
Cass & Co. Magnum Opportunity Fund 58,667 * 58,667
Cass & Co. Magnum Tech Fund 47,667 * 47,667
Cogefin (Bermuda) Limited 41,667 * 41,667
CyberJunction 37,500 * 37,500
Richard A. Kunin MD Profit Sharing Plan 33,334 * 33,334
Wellness and Prevention Marketing LLC 26,667 * 26,667
David E. Wise 24,583 * 24,583
</TABLE>
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<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED BEFORE/AFTER THE
OFFERING(1)
--------------------------------------------
NAME OF SELLING STOCKHOLDER Number of
- --------------------------- Shares of common Percentage of shares Number of shares of
stock beneficially of common stock common stock
owned beneficially owned(2) registered
<S> <C> <C> <C>
Top Meadow Investment 20,834(5) * 20,834(5)
S. Greenberg Sep. Prop. Trust 20,000 * 20,000
Bradley Properties SA 20,000 * 20,000
Devrim AKA 16,667 * 16,667
Magnum Growth Fund LP 16,000 * 16,000
Matthew Stasior 12,467 * 12,467
Mark Bailey 10,834 * 10,834
David Boyer and Susan Boyer 10,500 * 10,500
Magnum Low Volatility Fund LP 8,667 * 8,667
Mark L. Friedman 8,334 * 8,334
Richard Golob 6,667 * 6,667
Marvin Shiller 5,000 * 5,000
Richard Carpenter 5,263 * 5,263
Leonard Block 4,167 * 4,167
Harvey R. Brice 4,001 * 4,001
Evert A. Bruckner Family Trust UA *
dtd Dec. 10, 1993 4,000 4,000
Chad L. Kiefer 4,000 * 4,000
Joseph A.Bauer 3,833 * 3,833
Kimberly A. Goguen 3,000 * 3,000
Ronald Posner 2,741 * 2,741
Edgeport Nominees Limited 2,500 * 2,500
Jeffery Lambertson 2,500 * 2,500
Alan Mandel 2,000 * 2,000
Lynn-Rose Saltzman 1,667 * 1,667
Michael Crowl 1,600 * 1,600
Jay S. Kunin 1,250 * 1,250
Larry W. Gellman 834 * 834
Scott W. Springer 834 * 834
Robert Zelinka 687 * 687
Robert L. Gordon and Andrea S. Gordon 417 * 417
Fred and Josephine Lionetti 417 * 417
</TABLE>
* Less than 1%
- --------------------------------------------------
(1) Represents shares beneficially owned by the named individual, including
shares of common stock that the person has the right to acquire within
60 days of the date of this prospectus. Unless otherwise noted, all
persons listed have sole voting and sole investment power.
(2) Based on 14,722,844 shares of common stock issued and outstanding as of
the date of this prospectus.
(3) These share amounts include up to an aggregate of 275,000 shares which
may be issued upon the exercise of Warrants.
12
<PAGE>
(4) These share amounts include up to an aggregate of 80,000 shares which
may be issued upon the exercise of Warrants.
(5) These share amounts include up to an aggregate of 20,834 shares which
may be issued upon the exercise of Warrants.
HOW THE SHARES MAY BE DISTRIBUTED
The selling stockholders may sell their shares of common stock in
various ways and at various prices. Some of the methods by which the selling
stockholders may sell their shares of common stock include:
/bullet/ ordinary brokerage transactions and transactions in which the
broker solicits purchasers;
/bullet/ privately negotiated transactions;
/bullet/ block trades in which the broker or dealer will attempt to
sell the shares of common stock as agent but may position and
resell a portion of the block as principal to facilitate the
transaction;
/bullet/ purchases by a broker or dealer as principal and resale by
that broker or dealer for the selling stockholder's account
under this prospectus;
/bullet/ sales under Rule 144 rather than by using this prospectus;
/bullet/ a combination of any of these methods of sale; and
/bullet/ any other legally permitted method.
The applicable sales price may be affected by the type of transaction.
The selling stockholders may also pledge their shares of common stock
as collateral for a margin loan under their customer agreements with their
brokers. If there is a default by the selling stockholders, the brokers may
offer and sell the pledged shares of common stock.
Brokers or dealers may receive commissions or discounts from the
selling stockholders (or, if the broker-dealer acts as agent for the purchaser
of the shares of common stock, from that purchaser) in amounts to be negotiated.
These commissions are not expected to exceed those customary in the types of
transactions involved.
We cannot estimate at the present time the amount of commissions or
discounts, if any, that will be paid by the selling stockholders in connection
with sales of the shares of common stock.
The selling stockholders and any broker-dealers or agents that
participate with the selling stockholders in sales of the shares of common stock
may be deemed to be "underwriters" within the meaning of the Securities Act of
1933, as amended, in connection with such sales. In that event, any commissions
received by broker-dealers or agents and any profit on the resale of the
13
<PAGE>
shares of common stock purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act of 1933, as amended.
Under the securities laws of certain states, the shares of common stock
may be sold in those states only through registered or licensed broker-dealers.
In addition, the shares of common stock may not be sold unless the shares of
common stock have been registered or qualified for sale in the relevant state or
unless the shares of common stock qualify for an exemption from registration or
qualification.
We have agreed to pay all fees and expenses incident to the
registration of the shares of common stock.
The selling stockholders and other persons participating in the
distribution of the shares of common stock offered under this prospectus are
subject to the applicable requirements of Regulation M promulgated under the
Securities Exchange Act of 1934, in connection with sales of the shares of
common stock.
LEGAL OPINION
Broad and Cassel, a partnership including professional associations,
201 South Biscayne Boulevard, Suite 3000, Miami, Florida 33131, is giving an
opinion regarding the validity of the offered shares of common stock.
EXPERTS
The financial statements incorporated by reference in this prospectus
have been audited by Richard A. Eisner & Company, LLP, independent auditors, to
the extent and for the periods set forth in their report incorporated herein by
reference, and are incorporated herein in reliance upon such report given upon
the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any report or document we file at the public reference facilities
maintained by the Securities and Exchange Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549 and at the Securities and Exchange
Commission's regional offices located at Seven World Trade Center, Suite 1300,
New York, New York 10048, and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Please call the SEC at 1-800-SEC-0880 for more information about
the public reference rooms. Our Securities and Exchange Commission filings are
also available from the Securities and Exchange Commission's website located at
HTTP://WWW.SEC.GOV.
Quotations for the prices of our common stock appear on the Nasdaq
National Market, and reports, proxy statements and other information about us
can also be inspected at the offices of the National Association of Securities
Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
14
<PAGE>
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with it, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and later information that we file with the Securities and Exchange
Commission will automatically update and supersede this information.
We incorporate by reference the following filings and any future
filings made with the Securities and Exchange Commission under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934:
/bullet/ The description of the common stock contained in our
registration statement on Form S-B2 (File Number 333-72385),
filed on July 14, 1999;
/bullet/ Our Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1999.
We have filed with the Commission a post-effective amendment to Form
SB-2 on Form S-3 with respect to the securities being offered hereby. This
prospectus does not contain all of the information set forth in such
registration statement, as permitted by the Rules and Regulations of the
Securities and Exchange Commission. For further information with respect to us
and such securities, reference is made to the registration statement and to the
exhibits and schedules filed therewith. Each statement made in this prospectus
referring to a document filed as an exhibit to the registration statement is
qualified by reference to the exhibit for a complete statement of its terms and
conditions. The registration statement, including exhibits thereto, may be
inspected without charge at the Securities and Exchange Commission's principal
office at 450 Fifth Street, N.W., Washington, D.C. 20549; at its Northeast
Regional Office at 7 World Trade Center, Suite 1300, New York, New York 10048;
and at its Midwest Regional Office at 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511; and copies of all or any part thereof may be
obtained from such offices upon payment of the prescribed fees.
You may request, at no cost, a copy of any or all of the information
incorporated by reference by writing or telephoning us at:
GlobalNet Financial.com, Inc.
7284 W. Palmetto Park Road
Suite 210
Boca Raton, Florida 33433
(561) 417-8053
Attention: Corporate Secretary
You should only rely on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. Our common stock is not being
offered in any state where the offer is not permitted. You should not assume
that the information in this prospectus or any supplement is accurate as of any
date other than the date on the front of those documents.
15
<PAGE>
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Certificate of Incorporation provides for indemnification rights
of officers, directors, and others and limits the personal liability of
directors for monetary damages to the extent permitted by Delaware Law. Insofar
as indemnification for liabilities arising under the Securities Act of 1933, as
amended, may be permitted to our directors, officers, and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable.
We maintain a directors and officers' liability policy insuring any
person who is or was our director or officer against any liability incurred by
such person in any such capacity or arising out of such person's status as such.
The insurer's limit of liability under the policy is a $25.0 million coverage
limit per occurrence and $25.0 million in the aggregate per two-year policy
period. The policy contains various reporting requirements and is subject to
certain exclusions and limitations.
16
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE REGISTRATION STATEMENT
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
We estimate that our expenses in connection with this post-effective
amendment will be as follows:
Legal fees and expenses $15,000
Accounting fees and expenses $ 5,000
Miscellaneous $ 5,000
-------
Total $25,000
=======
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Certificate of Incorporation provides for indemnification rights of
officers, directors, and others and limits the personal liability of directors
for monetary damages to the extent permitted by Delaware Law. Insofar as
indemnification for liabilities arising under the Securities Act of 1933, as
amended, may be permitted to our directors, officers, and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable.
We maintain a directors and officers' liability policy insuring any
person who is or was our director or officer against any liability incurred by
such person in any such capacity or arising out of such person's status as such.
The insurer's limit of liability under the policy is a $25.0 million coverage
limit per occurrence and $25.0 million in the aggregate per two-year policy
period. The policy contains various reporting requirements and is subject to
certain exclusions and limitations.
EXHIBITS
5.1 Opinion of Broad and Cassel
23.1 Consent of Broad and Cassel (contained in its opinion filed as Exhibit
5.1 to this Registration Statement)
23.2 Consent of Richard A. Eisner & Company, LLP
24.1 Power of Attorney (included in the signature page of this Registration
Statement)
- ---------------------------
UNDERTAKINGS
The undersigned Registrant hereby undertakes:
17
<PAGE>
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(a) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(b) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement; and
(c) To include any additional or changed material information
on the plan of distribution;
PROVIDED, HOWEVER, that paragraphs (1)(a) and (1)(b) shall not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933, as amended, and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful
18
<PAGE>
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933, as amended, and will be governed by the
final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this
post-effective amendment to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boca Raton, State of Florida on this
1st day of May 2000.
GLOBALNET FINANCIAL.COM, INC.
By: /s/ Stanley Hollander
------------------------------------
Stanley Hollander
Chairman of the Board, President
and Chief Executive Officer
19
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints
Michael S. Jacobs and Stanley Hollander as his or her true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution
for him or her and in his or her name, place and stead in any and all capacities
to execute in the name of each such person who is then an officer or director of
the Registrant any and all amendments to this registration statement, and any
registration statement relating to the offering hereunder pursuant to Rule 462
under the Securities Act of 1933, as amended, and to file the same with all
exhibits thereto and other documents in connection therewith with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents and
each of them full power and authority to do and perform each and every act and
thing required or necessary to be done in and about the premises as fully as he
or she might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents, or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
post-effective amendment has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Stanley Hollander Chairman of the Board, President, May 1, 2000
- --------------------------------------------- Chief Executive Officer
Stanley Hollander (Principal Executive Officer)
/s/ W. Thomas Hodgson Chief Operating Officer May 1, 2000
- ---------------------------------------------
W. Thomas Hodgson
/s/ Alan L. Jacobs Executive Vice President and Director May 1, 2000
- ---------------------------------------------
Alan L. Jacobs
/s/ Michael S. Jacobs Chief Financial Officer, Secretary and May 1, 2000
- --------------------------------------------- Treasurer (Principal Financial and
Michael S. Jacobs Accounting Officer)
/s/ Jay J. Matulich Senior Managing Director May 1, 2000
- ---------------------------------------------
Jay J. Matulich
/s/ Ronald B. Koenig Director May 1, 2000
- ---------------------------------------------
Ronald B. Koenig
/s/ Kym Anthony Director May 1, 2000
- ---------------------------------------------
Kym Anthony
/s/ Christopher Jennings Director May 1, 2000
- ---------------------------------------------
Christopher Jennings
/s/ N. Bulent Gultekin Director May 1, 2000
- ---------------------------------------------
N. Bulent Gultekin
/s/ Michael Whitaker Director May 1, 2000
- ---------------------------------------------
Michael Whitaker
/s/ Nicholas Backhouse Director May 1, 2000
- ---------------------------------------------
Nicholas Backhouse
</TABLE>
20
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
- ------- -----------
5.1 Opinion of Broad and Cassel
23.2 Consent of Richard A. Eisner & Company, LLP
EXHIBIT 5.1
OPINION AND CONSENT OF BROAD AND CASSEL
BROAD AND CASSEL
201 South Biscayne Boulevard
Suite 3000
Miami, Florida 33131
May 1, 2000
GlobalNet Financial.com, Inc.
7284 W. Palmetto Park Road
Suite 210
Boca Raton, Florida 33433
Re: GLOBALNET FINANCIAL.COM, INC.
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
You have requested our opinion with respect to the shares of the
Company's common stock, par value $.001 per share (the "Common Stock"), included
in the Registration Statement on Form S-3 (the "Form S-3") filed with the U.S.
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended (the "Securities Act").
As counsel to the Company, we have examined the original or certified
copies of such records of the Company, and such agreements, certificates of
public officials, certificates of officers or representatives of the Company and
others, and such other documents as we deem relevant and necessary for the
opinions expressed in this letter. In such examination, we have assumed the
genuineness of all signatures on original documents, and the conformity to
original documents of all copies submitted to us as conformed or photostatic
copies. As to various questions of fact material to such opinions, we have
relied upon statements or certificates of officials and representatives of the
Company and others.
Based on, and subject to, the foregoing, we are of the opinion that the
shares of Common Stock being registered in the Form S-3, once issued as
contemplated under the Form S-3, will have been duly and validly issued, and
shall be fully paid and non-assessable.
In rendering this opinion, we advise you that members of this Firm are
members of the Bar of the State of Florida, and we express no opinion herein
concerning the applicability or effect of any laws of any other jurisdiction,
except the securities laws of the United States of America referred to herein.
This opinion has been prepared and is to be construed in accordance
with the Report on Standards for Florida Opinions, dated April 8, 1991, as
amended and supplemented, issued by the Business Law Section of The Florida Bar
(the "Report"). The Report is incorporated by reference into this opinion.
<PAGE>
We hereby consent to the filing of this opinion as an exhibit to the
Form S-3. In giving such consent, we do not thereby admit that we are included
within the category of persons whose consent is required under Section 7 of the
Securities Act, or the rules and regulations promulgated thereunder.
Very truly yours,
/s/ Broad and Cassel
--------------------------
BROAD AND CASSEL
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-3 Post-Effective Amendment to Form SB-2 (No. 333-72385) of
GlobalNet Financial.com, Inc. (the "Company") of our report dated March 17, 2000
on our audit of the consolidated financial statements of GlobalNet
Financial.com, Inc. and subsidiaries as of December 31, 1999 and for the years
ended December 31, 1999 and 1998. We also consent to the reference to our firm
under the caption "Experts" in the Prospectus.
Richard A. Eisner & Company, LLP
New York, New York
April 26, 2000
