U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
(MARK ONE)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR FISCAL YEAR ENDED: DECEMBER 31, 2004
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from To
Commission file number 0-27737
CANGLOBE INTERNATIONAL, INC.
(Name of small business issuer in its charter)
Nevada 77-0454856
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State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
#2440, 10303 Jasper Avenue, Edmonton, AB, Canada T5J 3N6
(Address of principal executive offices) (Zip code)
Issuer's telephone number (780) 428-6002
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Securities registered under Section 12(b) of the Act: NONE Securities registered
under Section 12(g) of the Act:
Common Stock, par value $.001
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes X No
Check if there is no disclosure of delinquent filers pursuant to Item
405 of Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this form 10-KSB. [ ]
State issuer's revenues for its most recent fiscal year. $ 0
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As of December 31, 2004, there were 18,303,462 shares of the
Registrant's common stock, par value $0.001, issued and outstanding. The amount
of shares has been adjusted to reflect the six to one stock split enacted on
February 24, 2005. The aggregate market value of the Registrant's voting stock
held by non-affiliates of the Registrant as of December 31, 2004 was $497,254.
DOCUMENTS INCORPORATED BY REFERENCE
If the following documents are incorporated by reference, briefly
describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II,
etc.) into which the document is incorporated: (1) any annual report to security
holders; (2) any proxy or information statement; and (3) any prospectus filed
pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"):
NONE
Transitional Small Business Disclosure Format (check one): Yes ; NO X
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TABLE OF CONTENTS
Item Number and
Caption Page
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PART I
Item 1. Description of Business.........................................................................4
Item 2. Description of Property.........................................................................7
Item 3. Legal Proceedings...............................................................................7
Item 4. Submission of Matters to a Vote of Security Holders.............................................7
PART II
Item 5. Market for Common Equity and Related Stockholder Matters........................................8
Item 6. Management's Discussion and Analysis or Plan of Operations......................................9
Item 7. Financial Statements...........................................................................12
Item 8. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure...........................................................................12
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act..............................................12
Item 10. Executive Compensation..................................................................................15
Item 11. Security Ownership of Certain Beneficial Owners and Management..........................................16
Item 12. Certain Relationships and Related Transactions..........................................................16
Item 13. Exhibits and Reports on Form 8-K........................................................................16
Item 14. Controls and Procedures........................................................................18
Item 15. Principal Accountant Fees and Services..................................................................18
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
GENERAL
Beginning in late 2001 and continuing through early 2002, we, the
Company, entered into a series of transactions culminating into the natural
resources business environment. As well on the same date the Company changed its
name to Red Butte Energy, Inc. The Company formerly was an Internet destination
providing community, content and commerce for the sportbike and motorcycle
enthusiast. The eSportbike.com website was a location where individuals, could
create their own websites, publish pictures of their bikes, share information,
communicate, shop and discover meaningful, relevant content targeted to their
specific interests. The Company discontinued this activity during the fourth
quarter of 2001.
On April 18, 2002, the Company entered into a letter of intent to
acquire an undivided 50% interest in the Coal Creek Basin and adjacent
properties in McBrien Twp., Ontario, Canada. The Company ultimately abandoned
that project when the claims did not contain the estimated resources.
On October 22, 2002, the Company, based upon licensed technology
available from its largest shareholder, Canglobe Development, Inc. (a patented
process of devulcanizing rubber and activating the crumb rubber from shredded
tires) reviewed the prospects of entering this industry but abandoned this on
December 17, 2004.
On March 19, 2002, the Company amended our Articles of Incorporation to
change our name from "eSportbike.com, Inc." to "Red Butte Energy, Inc." The
purpose of this amendment was to reflect the scope and type of our business
activities. At the same time, the Company effected a reduction in our
outstanding capitalization by effecting a "reverse split" pursuant to which the
Company issued one share of our common stock in exchange for every eight (8)
outstanding shares of our common stock. As a result of the reverse split, the
number of issued and outstanding shares of our common stock was reduced from
16,400,000 shares to 2,050,000 shares. The rights and preferences of our common
stock were not modified or amended in connection with the reverse split and the
Company's trading symbol was changed to "RDBT." On January 16, 2003, the Company
again changed its name from Red Butte to Canglobe International, Inc. and the
trading symbol changed to "CGLB" and on February 24, 2005 to "CGLO".
During the period covered by this report, the Company conducted only
minimal business operations, the Company engaged in no mineral research
activities or related development and did not expend any amounts on mineral
research or exploration. The Company currently has no employees. Certain
administrative services relating to our minimal maintenance operations were
provided by employees of our majority shareholders.
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HISTORY
The Company was organized as Morenci Corp., a Nevada Corporation, for
the purpose of creating a corporate vehicle to seek, investigate and, where
appropriate, acquire an interest in one or more business opportunities presented
to it by persons or firms who or which desire to seek perceived advantages of a
publicly held corporation.
Morenci was incorporated on April 7, 1997 and was formed specifically
to be a "clean public shell" for the purpose of either merging with or acquiring
an operating company. The Company ceased all activities from October 29, 1996 to
July 9, 1999 and was considered dormant. On July 9, 1999, the Company obtained a
certificate of renewal from the State of Nevada. On March 2, 2000, the Company
entered into an agreement whereby the Company, in a reverse merger, purchased
the assets of eSportbike.com, Inc. The Company also changed its name to
eSportbike.com, Inc. From March 2, 2000 to October 2001, the Company operated an
internet web site in the sport bike industry. On March 19, 2002, the Company
changed its name to Red Butte Energy, Inc. On January 16, 2003, the Company
again changed its name from Red Butte to Cangloble International, Inc.
The Company's authorized capital is 100,000,000 shares of common stock,
par value $0.001 per share. It is quoted and traded from time to time on the
National Association of Security Dealers, Inc. (the "NASD's") OTC Bulletin Board
Under the symbol "CGLO."
The executive offices of the Company are located at #2440, 10303 Jasper
Avenue, Edmonton, AB, Canada T5J 3N6. Its telephone number is (780) 428-6002.
OPERATING LOSSES
The Company has incurred net losses of approximately $239,000 and
$49,000 for the fiscal years ended December 31, 2004 and 2003, respectively.
Such operating losses reflect developmental and other start-up activities. The
Company expects to incur losses in the near future. The Company's operations are
subject to numerous risks associated with establishing any new business,
including unforeseen expenses, delays and complications. There can be no
assurance that the Company will achieve or sustain profitable operations or that
it will be able to remain in business.
FUTURE CAPITAL NEEDS AND UNCERTAINTY OF ADDITIONAL FUNDING
The Company was not in full operations during 2004 and 2003, and thus,
the revenues generated are not representative of those that will be generated
once the Company becomes fully operational. Revenues are not yet sufficient to
support the Company's operating expenses and are not expected to reach such
levels during 2005. Since the Company's formation, it has funded its operations
and capital expenditures primarily through private placements of debt and equity
securities. See "Recent Sales of Unregistered Securities." The Company expects
that it will be required to seek additional financing in the future. There can
be no assurance that such financing will be available at all or available on
terms acceptable to the Company.
5
GOVERNMENT REGULATION
The Company is subject to all pertinent Federal, State, and Local laws
governing its business. The Company is subject to licensing and regulation by a
number of authorities in its Province (State) or municipality. These may include
health, safety, and fire regulations. The Company's operations are also subject
to Federal and State minimum wage laws governing such matters as working
conditions and overtime.
RISK OF LOW PRICED STOCKS
Rules 15g-1 through 15g-9 promulgated under the Securities Exchange Act
of 1934 (the "Exchange Act") impose sales practice and disclosure requirements
on certain brokers and dealers who engage in certain transactions involving "a
penny stock."
Currently, the Company's common stock is considered a penny stock for
purposes of the Exchange Act. The additional sales practice and disclosure
requirements imposed on certain brokers and dealers could impede the sale of the
Company's common stock in the secondary market. In addition, the market
liquidity for the Company's securities may be severely adversely affected, with
concomitant adverse effects on the price of the Company's securities.
Under the penny stock regulations, a broker or dealer selling penny
stock to anyone other than an established customer or "accredited investor"
(generally, an individual with net worth in excess of $1,000,000 or annual
incomes exceeding $200,000, or $300,000 together with his or her spouse) must
make a special suitability determination for the purchaser and must receive the
purchaser's written consent to the transaction prior to sale, unless the broker
or dealer or the transaction is otherwise exempt. In addition, the penny stock
regulations require the broker or dealer to deliver, prior to any transaction
involving a penny stock, a disclosure schedule prepared by the Securities and
Exchange Commission (the "SEC") relating to the penny stock market, unless the
broker or dealer or the transaction is otherwise exempt. A broker or dealer is
also required to disclose commissions payable to the broker or dealer and the
registered representative and current quotations for the Securities. In
addition, a broker or dealer is required to send monthly statements disclosing
recent price information with respect to the penny stock held in a customer's
account and information with respect to the limited market in penny stocks.
THE VOLATILITY OF OUR STOCK PRICE
Our quarterly operating results may fluctuate significantly as a result
of a variety of factors, many of which are outside of our control. These factors
include:
o The amount and timing of orders for our services or products;
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o Disruptions in the supply of delivering services or products;
o Seasonal variations in the sale of our services or products; and o
General economic conditions.
LACK OF TRADEMARK AND PATENT PROTECTION
The Company relies on a combination of trade secret, copyright and
trademark law, nondisclosure agreements and technical security measures to
protect its products. Notwithstanding these safeguards, it is possible for
competitors of the company to obtain its trade secrets and to imitate its
products. Furthermore, others may independently develop products similar or
superior to those developed or planned by the Company.
COMPETITION
The Company faces competition from a wide variety of companies, many of
which may have substantially greater financial, marketing and technological
resources.
EMPLOYEES
As of December 31, 2004, the Company had no employees.
ITEM 2. DESCRIPTION OF PROPERTY
Since 1997 through 2004, all administrative activities of the Company
have been conducted by corporate officers from either their home or business
offices. Currently, there are no outstanding debts owed by the Company for the
use of these facilities and there are no commitments for future use of the
facilities.
Since December 2004, the Company has been using office space
provided by a major shareholder, on a gratis basis.
ITEM 3. LEGAL PROCEEDINGS
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A
VOTE OF SECURITY HOLDERS
No matters were subject to a vote of security holders during the year
2004.
7
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
The Company's Common Stock is traded from time to time on the NASD's
OTC Bulletin Board under the symbol "CGLO" (prior to February 24, 2005 it was
traded under the symbol "CGLB". The following table presents the high and low
bid quotations for the Common Stock as reported by the NASD for each quarter
during the last two years. Such prices reflect inter-dealer quotations without
adjustments for retail markup, markdown or commission, and do not necessarily
represent actual transactions.
2004 HIGH LOW
First Quarter $0.90 $0.65
Second Quarter $1.01 $0.60
Third Quarter $1.15 $0.40
Fourth Quarter $0.70 $0.51
2003
First Quarter $0.80 $0.21
Second Quarter $0.45 $0.15
Third Quarter $0.80 $0.31
Fourth Quarter $0.80 $0.60
DIVIDENDS
The Company has never declared or paid any cash dividends. It is the
present policy of the Company to retain earnings to finance the growth and
development of the business and, therefore, the Company does not anticipate
paying dividends on its common stock in the foreseeable future.
The number of shareholders of record of the Company's Common Stock as
of December 31, 2004 was approximately 16.
8
RECENT SALES OF UNREGISTERED SECURITIES
In connection with organizing the Company, on April 18, 1997,
twenty-eight persons consisting of its officers, directors, and other
individuals were issued a total of 1,000 shares of common stock at a value of
$.001 per share. On May 6, 1999, those outstanding shares were forward split
1,000 to 1, resulting in a total of 1,000,000 shares outstanding.
On February 23, 2000, 800,000 shares were returned to the treasury and
the shares were canceled, resulting in 200,000 remaining shares outstanding.
On February 23, 2000, the Company declared a forward split 27 to 1,
resulting in a total of 5,400,000 shares outstanding.
On March 20, 2000, the Company issued 11,000,000 shares of the
Company's common stock to officers and directors.
On March 5, 2002, the Company issued 300,000 shares to
consultants in exchange for services rendered, and subsequently registered these
shares on Form S-8 on June 18, 2002.
On October 31, 2003, the board of directors approved a debt to equity
transaction, where $280,228 in debt was converted into 700,570 shares of
restricted common stock.
On January 21, 2005, the Board of Directors approved a 6 to 1 stock
split of the Company's common stock, effective February 24, 2004. The stock
split increased the number of outstanding common shares from 3,050,577 to
18,303,462 as of December 31, 2004. All references to the Company's common stock
in the financial statements have been restated to reflect the stock split.
On January 29, 2005, the board of directors approved a settlement
agreement where $247,858 indebtedness was settled as convertible promissory
notes. On February 2, 2005, these convertible promissory notes were converted
into 26,987,568 shares of common stock.
ITEM 6. MANAGEMENT'S DISCUSSION AND
ANALYSIS OR PLAN OF OPERATIONS
The following information should be read in conjunction with the
information in Item 7, Financial Statements, and other information regarding our
financials performance for the period covered by this report included elsewhere
in this report. The following discussions and other parts of this report may
contain forward-looking statements that involve risks and uncertainties. Our
actual results may differ significantly from the results discussed in those
forward-looking statements. Factors that might cause such differences include,
but are not limited to, our history of unprofitability and the uncertainty of
our profitability, our ability to develop and introduce new services and
products, the uncertainty of market acceptance of those services or products,
our potential reliance on collaborative partners, our limited sales and
marketing experience, the highly competitive industries in which we operate and
general economic and business conditions, some or all of which may be beyond our
ability to control.
9
PLAN OF OPERATIONS
The Company was organized for the purpose of creating a corporate
vehicle to seek, investigate and, if such investigation warrants, acquire an
interest in one or more business opportunities presented to it by persons or
firms who or which desire to seek perceived advantages of a publicly held
corporation.
The Company may incur significant post-merger or acquisition
registration costs in the event management wishes to register a portion of their
shares for subsequent sale. The Company will also incur significant legal and
accounting costs in connection with the acquisition including the costs of
preparing post- effective amendments, Forms 8-K, agreements and related reports
and documents.
The Company will not have sufficient funds (unless it is able to raise
funds in a private placement) to undertake any significant development,
marketing and manufacturing of the products acquired. Accordingly, following the
acquisition, the Company will, in all likelihood, be required to either seek
debt or equity financing or obtain funding from third parties, in exchange for
which the Company may be required to give up a substantial portion of its
interest in the acquired product. There is no assurance that the Company will be
able either to obtain additional financing or interest third parties in
providing funding for the further development, marketing and manufacturing of
any products acquired.
On March 19, 2002, the Board of Directors approved a 1 for 8 reverse
stock split. As well on the same date, the Company changed its name to Red Butte
Energy, Inc. On January 16, 2003, the Company changed its name to Canglobe
International, Inc. and the direction the Company is going. The Company will not
proceed with the development of any software business in Asia. Similarly, the
Company has decided not to operate any web based business related to sportbikes
or any other products. The Company will not proceed on opportunities in the tire
reclamation and rubber recycling industries.
RESULTS OF OPERATIONS
The Company reported net losses of $238,941 and $48,658 for the years
ended December 31, 2004 and 2003, respectively, which were due to general and
administrative expenses incurred by the Company. The most significant increase
was due to $223,108 paid in consulting during 1994. From December 1, 2001, the
Company was a development stage company and had not begun principal operations.
10
LIQUIDITY AND CAPITAL RESOURCES
The Company has met its capital requirements through the sale of its
common stock .
Since the Company's re-activation in July 9, 1999, the Company's
principal capital requirements have been the funding of the development of the
Company.
The Company expects future development and expansion will be financed
through cash flow from operations and other forms of financing such as the sale
of additional equity and debt securities, capital leases and other credit
facilities. There are no assurances that such financing will be available on
terms acceptable or favorable to the Company.
GOVERNMENT REGULATIONS
The Company is subject to all pertinent Federal, State, and Local laws
governing its business. The Company is subject to licensing and regulation by a
number of authorities in its Province (State) or municipality. These may include
health, safety, and fire regulations. The Company's operations are also subject
to Federal and State minimum wage laws governing such matters as working
conditions and overtime.
FORWARD LOOKING STATEMENT
This Management's Discussion and Analysis of Financial Condition and
Results of Operations include a number of forward-looking statements that
reflect Management's current views with respect to future events and financial
performance. Those statements include statements regarding the intent, belief or
current expectations of the Company and members of its management team as well
as the assumptions on which such statements are based. Prospective investors are
cautioned that any such forward-looking statements are not guarantees of future
performance and involve risk and uncertainties, and that actual results may
differ materially from those contemplated by such forward-looking statements.
Readers are urged to carefully review and consider the various disclosures made
by the Company in this report and in the Company's other reports filed with the
Securities and Exchange Commission. Important factors currently known to
Management could cause actual results to differ materially from those in
forward-looking statements. The Company undertakes no obligation to update or
revise forward-looking statements to reflect changed assumptions, the occurrence
of unanticipated events or changes in the future operating results over time.
The Company believes that its assumptions are based upon reasonable data derived
from and known about its business and operations and the business and operations
of the Company. No assurances are made that actual results of operations or the
results of the Company's future activities will not differ materially from its
assumptions.
11
ITEM 7. FINANCIAL STATEMENTS
The financial statements of the Company and supplementary data are
included beginning immediately preceeding the signature page to this report. See
Item 13. for a list of the financial statements and financial statement
schedules included.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 9. DIRECTORS EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF
THE EXCHANGE ACT
EXECUTIVE OFFICERS AND DIRECTORS
The members of the Board of Directors of the Company serve until the
next annual meeting of stockholders, or until their successors have been
elected. The officers serve at the pleasure of the Board of Directors. On
October 22, 2002, when Canglobe Development acquired 1,250,000 shares of the
Company's common stock from Sinoray Technology, Chris Stewart was appointed to
the Board of Directors, and Xue Ming Liang resigned. On January 30, 2003, three
additional directors were appointed; Veronica Norris, Dr. Willi Neumann and
Harry McKinders. Chris Stewart resigned on March 3, 2002, leaving the board with
four members until March 2003, when Heinz Leuders was appointed President and
Director of the Company.
On November 15, 2004, Heinz Leuders, Harry McKinders, and Charles
Spooner resigned as officers and directors. Appointed as directors were David
Alexander, James Baker and Donald Getty. On March 1, 2005, Donald Sampson was
appointed as a director.
The following table sets forth the name, age, and position of each
executive officer and director of the Company:
DIRECTOR'S NAME AGE OFFICE TERM EXPIRES
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Donald Getty 71 Chairman/Director next annual meeting
James Baker 56 President/Director next annual meeting
David Alexander 54 Chief Financial Officer/Director next annual meeting
Donald Sampson 54 Director next annual meeting
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Set forth below is certain biographical information, present occupation
and business experience for the past five years of each director and executive
officer of the Company. Officers of the Company are elected by the Board of
Directors and hold office until their successors are chosen and qualified, until
their death or until they resign or have been removed from office. All corporate
officers serve at the discretion of the Board of Directors.
Mr. Donald Getty was appointed as Chairman and a director of the
Company on December 17, 2004. Mr. Getty earned his Business Administration
degree from the University of Western Ontario with honours in 1954. In 1955, he
started a ten-year career as quarterback of the Edmonton Eskimos before starting
his public career as an MLA in 1967. His positions with the Alberta government
included two terms as Premier of Alberta, the position of Energy Minister and
the position of Minister of Federal and Intergovernmental Affairs. In his
business career, Mr. Getty has served on the boards of distinguished companies
such as the Royal Bank of Canada, Nova Company, Genstar Company and
Interprovincial Pipe and Steel Corp. In recent years, Mr. Getty has been awarded
many honours, including an appointment as an Officer of the Order of Canada, an
honorary doctorate from the University of Lethbridge and is a member of the
Alberta Order of Excellence.
Mr. James Baker has been appointed President and Director. Mr. Baker
was awarded a Masters in Business Administration from Queen's University in 1974
and a Bachelor of Engineering Degree from the Nova Scotia Tech (Dalhousie)
University in 1970. He is an investment consultant and prior thereto between
1997 and October 2002, he was an investment advisor with a national investment
dealer which is a member of the Investment Dealers' Association of Canada. Prior
thereto between 1988 and 1997 he was President of Projex Corp Ltd., a project
management company.
Mr. David Alexander has been appointed Director and Chief Financial
Officer and Secretary. Mr. Alexander earned his Chartered Accountancy in 1978
and his bachelor's degree in Commerce at the University of British Columbia in
1974. Mr. Alexander has been a management consultant for the last ten years
working with several public companies including Security Biometrics, Inc.,
Nostrad Telecommunications, Inc., Central Minera Corp., Pinewood Resources Ltd.,
and Zaruma Resources Ltd.
Mr. Donald Sampson earned his engineering degree at the University of
Michigan in 1976. Subsequently, he commenced a 30 year career in mining, post
consumer plastics recycling, and medical waste treatment. In 1999, Mr. Sampson
sold his interest in a medical waste treatment business to Stericycle Inc., the
largest medical waste treatment centre in the world. During his five years with
Stericycle, Mr. Sampson, became VP-International Business Development and
Engineering. Mr. Sampson successfully completed over $100 million worth of
projects in Brazil, Argentina, South Africa, Japan, and Australia. His
responsibilities encompassed finding suitable joint venture partners,
negotiating agreements, project management, engineering, equipment procurement,
construction, start-up, and ongoing technical support for the various joint
venture medical waste treatment companies around the world. Mr. Sampson is a
senior member of the Instrument Society of America, and the Plastics Society of
America.
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CONFLICTS OF INTEREST
Certain conflicts of interest existed at December 31, 2004 and may
continue to exist between the Company and its officers and directors due to the
fact that each has other business interests to which they devote their primary
attention. Each officer and director may continue to do so notwithstanding the
fact that management time should be devoted to the business of the Company.
Certain conflicts of interest may exist between the Company and its
management, and conflicts may develop in the future. The Company has not
established policies or procedures for the resolution of current or potential
conflicts of interests between the Company, its officers and directors or
affiliated entities. There can be no assurance that management will resolve all
conflicts of interest in favor of the Company, and failure by management to
conduct the Company's business in the Company's best interest may result in
liability to the management. The officers and directors are accountable to the
Company as fiduciaries which mean that they are required to exercise good faith
and integrity in handling the Company's affairs. Shareholders who believe that
the Company has been harmed by failure of an officer or director to
appropriately resolve any conflict of interest may, subject to applicable rule
of civil procedure, be able to bring a class action or derivative suit to
enforce their rights and the Company's rights.
BOARD MEETINGS AND COMMITTEES
The Directors and Officers will not receive remuneration from the
Company until a subsequent offering has been successfully completed, or cash
flow from operating permits, all in the discretion of the Board of Directors.
Directors may be paid their expenses, if any, of attendance at such meeting of
the Board of Directors, and may be paid a fixed sum for attendance at each
meeting of the Board of Directors or a stated salary as Director. No such
payment shall preclude any Director from serving the Corporation in any other
capacity and receiving compensation therefor. No compensation has been paid to
the Directors. The Board of Directors may designate from among its members an
executive committee and one or more other committees. No such committees have
been appointed.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Based solely upon a review of forms 3, 4, and 5 and amendments thereto,
furnished to the Company during or respecting its last fiscal year, no director,
officer, beneficial owner of more than 10% of any class of equity securities of
the Company or any other person known to be subject to Section 16 of the
Exchange Act of 1934, as amended, failed to file on a timely basis reports
required by Section 16(a) of the Exchange Act for the last fiscal year.
14
AUDIT COMMITTEE FINANCIAL EXPERT
The Company's board of directors does not have an "audit committee
financial expert," within the meaning of such phrase under applicable
regulations of the Securities and Exchange Commission, serving on its audit
committee. The board of directors believes that all members of its audit
committee are financially literate and experienced in business matters, and that
one or more members of the audit committee are capable of (i) understanding
generally accepted accounting principles ("GAAP") and financial statements, (ii)
assessing the general application of GAAP principles in connection with our
accounting for estimates, accruals and reserves, (iii) analyzing and evaluating
our financial statements, (iv) understanding our internal controls and
procedures for financial reporting; and (v) understanding audit committee
functions, all of which are attributes of an audit committee financial expert.
However, the board of directors believes that there is not any audit committee
member who has obtained these attributes through the experience specified in the
SEC's definition of "audit committee financial expert." Further, like many small
companies, it is difficult for the Company to attract and retain board members
who qualify as "audit committee financial experts," and competition for these
individuals is significant. The board believes that its current audit committee
is able to fulfill its role under SEC regulations despite not having a
designated "audit committee financial expert."
ITEM 10. EXECUTIVE COMPENSATION
None of the executive officer's salary and bonus exceeded $100,000
during any of the Company's last two fiscal years.
15
ITEM 11. SECURITY OWNERSHIP OF BENEFICIAL OWNERS
AND MANAGEMENT
PRINCIPAL SHAREHOLDERS
The table below sets forth information as to each person owning of
record or who was known by the Company to own beneficially more than 5% of the
18,303,642 shares of issued and outstanding common stock of the Company as of
December 31, 2004 and information as to the
ownership of the Company's stock by each of its directors and executive officers
and by the directors and executive officers as a group. Except as otherwise
indicated, all shares are owned directly, and the persons named in the table
have sole voting and investment power with respect to shares shown as
beneficially owned by them.
NAME AND ADDRESS NATURE OF SHARES
OF BENEFICIAL OWNERS/DIRECTORS OWNERSHIP OWNED PERCENT
Lavallee Financial Corporation common stock 11,703,420 63.94%
Suite 2440, 10303 Jasper Avenue
Edmonton, Alberta
Canada T5J 3N6
26.59%
Cede & Co. common stock 4,861,104
PO Box 222
Bowling Green Station, NY 10274
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Shareholders of the Company have advanced the Company money in order to
pay general and administrative expenses. As of December 31, 2004 and 2003, the
Company owed $12,994 and $2,537, respectively, relating to these notes.
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ITEM 13. EXHIBITS, AND REPORTS ON FORM 8-K
(A) EXHIBITS
The following exhibits are included as part of this report:
Exhibit
Number Title of Document
2.1 Change in Control Agreement dated January 15, 2001 (1)
3.1 Articles of Incorporation (2)
3.2 Amended Articles of Incorporation (2)
3.3 Bylaws (2)
31.1 Certification of Principal Executive Officer Pursuant to 18 U.S.C
Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
31.2 Certification of Principal Financial Officer Pursuant to 18 U.S.C
Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
32.1 Certification of Principal Executive Officer Pursuant to 18 U.S.C
Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
32.2 Certification of Principal Financial Officer Pursuant to 18 U.S.C
Section 1350 as Adopted Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
(1) Incorporated by reference to the Registrant's quarterly report on Form
10-QSB filed on May 21, 2001.
(2) Incorporated by reference to the Registrant's registration statement on
Form 10-SB filed on October 20, 1999.
(B) REPORTS ON FORM 8-K FILED
Form 8-K was filed December 17, 2004.
17
ITEM 14. CONTROLS AND PROCEDURES
We have established disclosure controls and procedures to ensure that
material information relating to the Company, including its consolidated
subsidiaries, is made known to the officers who certify the Company's financial
reports and to other members of senior management and the Board of Directors.
Based on their evaluation, as of the end of the period covered by this
Annual Report on Form 10-KSB, the principal executive officer and principal
financial officer of Canglobe International, Inc. have concluded that Canglobe
International Inc.'s disclosure controls and procedures (as defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) are effective
in ensuring that the information required to be disclosed by the Company in
reports that it files or submits under the Securities Exchange Act of 1934 is
recorded, processed, summarized and reported within the time periods specified
in the SEC's rules and forms.
There were no significant changes in Canglobe International, Inc.
internal control over financial reporting during the Company's fourth fiscal
quarter that has materially affected, or is reasonably likely to materially
affect, the Company's internal control over financial reporting.
ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The following is a summary of the fees billed to us by Robison, Hill &
Company for professional services rendered for the years ended December 31, 2004
and 2003:
Service 2004 2003
--------------------------------------------------------------------------
Audit Fees $5,498 $3,532
Audit-Related Fees - -
Tax Fees 143 143
All Other Fees - -
--------------------------------------------------------------------------
Total $5,641 $3,675
==========================================================================
AUDIT FEES - Consists of fees billed for professional services rendered for the
audits of our financial statements, reviews of our interim financial statements
included in quarterly reports, services performed in connection with filings
with the Securities & Exchange Commission and related comfort letters and other
services that are normally provided by Robison, Hill & Company in connection
with statutory and regulatory filings or engagements.
TAX FEES - Consists of fees billed for professional services for tax compliance,
tax advice and tax planning. These services include assistance regarding
federal, state and local tax compliance and consultation in connection with
various transactions and acquisitions.
18
AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND PERMISSIBLE NON-AUDIT SERVICES OF
INDEPENDENT AUDITORS
The Audit Committee, is to pre-approve all audit and non-audit services
provided ny the independent auditors. These services may include audit services,
audit related services, tax services and other services as allowed by law or
regulation. Pre-approval is generally provided for up to one year and any
pre-approval is detailed as to the particular service or category of services
and is generally subject to a specifically approved amount. The independent
auditors and management are required to periodically report to the Audit
Committee regarding the extent of services provided by the independent auditors
in accordance with this pre-approval and the fees incurred to date. The Audit
Committee may also pre-approve particular services on a case-by-case basis.
19
CANGLOBE INTERNATIONAL, INC.
(A DEVELOPMENT STAGE COMPANY)
-:-
INDEPENDENT AUDITOR'S REPORT
DECEMBER 31, 2004 AND 2003
CONTENTS
Page
Independent Auditor's Report...............................................................................F - 1
Balance Sheets
December 31, 2004 and 2003...............................................................................F - 3
Statements of Operations for the years ended
December 31, 2004 and 2003 and for the Cumulative Period from
December 1, 2001 (inception of development stage) to December 31, 2004...................................F - 4
Statement of Stockholders' Equity
Since April 7, 1997 (inception) to December 31, 2004.....................................................F - 5
Statements of Cash Flows for the years ended December 31, 2004 and 2003 and for
the Cumulative Period from
December 1, 2001 (inception of development stage) to December 31, 2004...................................F - 7
Notes to Financial Statements..............................................................................F - 8
INDEPENDENT AUDITOR'S REPORT
Canglobe International, Inc.
(A Development Stage Company)
We have audited the accompanying balance sheet of Canglobe
International, Inc. (a development stage company) as of December 31, 2004 and
2003 and the related statements of operations and cash flows for the two years
then ended and the cumulative since December 1, 2001 to December 31, 2004 and
the statement of stockholders' equity from April 7, 1997 (inception) to December
31, 2004. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). 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
audits provide 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 Canglobe
International, Inc. (a development stage company) as of December 31, 2004 and
2003 and the results of its operations and its cash flows for the years ended
December 31, 2004 and 2003 and the cumulative since December 1, 2001 to December
31, 2004 in conformity with accounting principles generally accepted in the
United States of America.
F - 1
The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operation
and has a deficit in stockholders' equity as of December 31, 2004 that together
raise substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters also are described in Note 1. The
financial statements do not include any adjustments relating to the
recoverability and classification of asset carrying amounts or the amount and
classification of liabilities that might result from the outcome of this
uncertainty.
Respectfully submitted,
/s/ Robison, Hill & Co.
Certified Public Accountants
Salt Lake City, Utah
February 15, 2005
F - 2
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
BALANCE SHEETS
December 31,
-------------------------------------
2004 2003
----------------- -----------------
Assets
Cash and cash equivalents $ - $ -
----------------- -----------------
Total Current Assets - -
----------------- -----------------
Property and Equipment
Computer equipment - 4,664
Furniture and equipment - 417
----------------- -----------------
- 5,081
Less accumulated depreciation - (5,081)
----------------- -----------------
Net Property and Equipment - -
----------------- -----------------
Total Assets $ - $ -
================= =================
Liabilities and Shareholders' Equity
Liabilities
Accounts payable and accrued liabilities $ 254,110 $ 25,626
----------------- -----------------
Total current liabilities 254,110 25,626
Due to shareholders 12,994 2,537
----------------- -----------------
Total liabilities 267,104 28,163
----------------- -----------------
Stockholders' Equity
Common Stock, Par value $.001, Authorized
100,000,000 shares, Issued 18,303,462
at December 31, 2004 and 2003 18,303 18,303
Paid-In Capital 508,396 508,396
Retained Deficit (273,432) (273,432)
Deficit Accumulated During the
Development Stage (520,371) (281,430)
----------------- -----------------
Total Stockholders' Equity (267,104) (28,163)
----------------- -----------------
Total Liabilities and Stockholders' Equity $ - $ -
================= =================
The accompanying notes are an integral part of these financial statements.
F - 3
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
Cumulative
Since
December 1,
2001
For the Year Ended Inception of
December 31, Development
--------------------------------------
2004 2003 Stage
------------------ ------------------- ------------------
Revenues $ - $ - $ -
Expenses
General and administrative 238,688 48,658 520,118
------------------ ------------------- ------------------
Total expenses 238,688 48,658 520,118
------------------ ------------------- ------------------
Other Income (Expense)
Interest Expense (253) - (253)
Net Loss $ (238,941)$ (48,658)$ (520,371)
================== =================== ==================
Earnings per Share, Basic & Diluted
Loss Per Share $ (0.01) $ -
================== ===================
Weighted Average Shares Outstanding 18,303,462 14,802,534
================== ===================
The accompanying notes are an integral part of these financial statements.
F - 4
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
SINCE APRIL 7, 1997 (INCEPTION) TO DECEMBER 31, 2004
Deficit
Accumulated
Since April 7,
Common Stock Paid-In Retained 1997
Shares Par Value Capital Deficit Inception
--------------- -------------- ------------- --------------- -----------------
Balance at April 7, 1997(inception) - $ - $ - $ - $ -
April 18, 1997 Issuance of Stock
for payment of accounts payable 675,000 675 8,537 - -
Net Loss - - - (1,100) -
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 1997 675,000 675 8,537 (1,100) -
Retroactive Adjustment for 6:1
Stock Split February 24, 2005 3,375,000 3,375 (3,375) - -
--------------- -------------- ------------- --------------- -----------------
Restated Balance at December 31, 1997 4,050,000 4,050 5,162 (1,100) -
Net Loss - - - (100) -
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 1998 4,050,000 4,050 5,162 (1,200) -
Net Loss - - - (4,086) -
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 1999 4,050,000 4,050 5,162 (5,286) -
March 31, 2000 Issuance of Stock
for payment of accounts payable 8,250,000 8,250 2,750 - -
Net Loss - - - (252,026) -
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 2000 12,300,000 12,300 7,912 (257,312) -
Net Loss - - - (16,120) (4,313)
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 2001 12,300,000 12,300 7,912 (273,432) (4,313)
June 24, 2002, Shares Issued for
Services 1,800,042 1,800 224,459 - -
Net Loss - - - - (228,459)
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 2002 14,100,042 14,100 232,371 (273,432) (232,772)
--------------- -------------- ------------- --------------- -----------------
F - 5
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
SINCE APRIL 7, 1997 (INCEPTION) TO DECEMBER 31, 2004
(Continued)
Deficit
Accumulated
Since April 7,
Common Stock Paid-In Retained 1997
Shares Par Value Capital Deficit Inception
--------------- -------------- ------------- --------------- -----------------
October 31, 2003, Stock issued for 4,203,420 $ 4,203 $ 276,025 $ - $ -
Conversion of debt
Net Loss - - - - (48,658)
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 2003 18,303,462 18,303 508,396 (273,432) (281,430)
--------------- -------------- ------------- --------------- -----------------
Net Loss - - - - (238,941)
--------------- -------------- ------------- --------------- -----------------
Balance at December 31, 2004 18,303,462 $ 18,303 $ 508,396 $ (273,432) $ (520,371)
=============== ============== ============= =============== =================
The accompanying notes are an integral part of these financial statements
F - 6
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
Cumulative
Since
December 1,
2001
For the Years Ended Inception of
December 31, Development
-----------------------------------
2004 2003 Stage
----------------- ---------------- ------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net Loss for the period $ (238,941) $ (48,658)$ (520,371)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization - 176 3,088
Common Stock Issued for Services - - 226,259
Changes in Operating Assets and Liabilities
Increase (Decrease) in Accounts Payable 228,484 15,135 236,711
----------------- ---------------- ------------------
Net Cash Used in operating activities (10,457) (33,347) (54,313)
----------------- ---------------- ------------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchase of property and equipment - - -
----------------- ---------------- ------------------
Net cash provided by investing activities - - -
----------------- ---------------- ------------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from shareholder advances 10,457 33,347 53,572
----------------- ---------------- ------------------
Net Cash Provided by Financing Activities 10,457 33,347 53,572
----------------- ---------------- ------------------
Net (Decrease) Increase in
Cash and Cash Equivalents - - (741)
Cash and Cash Equivalents
at Beginning of Period - - 741
----------------- ---------------- ------------------
Cash and Cash Equivalents
at End of Period $ - $ - $ -
================= ================ ==================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest $ - $ - $ -
Franchise and income taxes $ - $ - $ -
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Note Payable Converted to Stock $ - $ 280,228 $ 280,228
The accompanying notes are an integral part of these financial statements.
F - 7
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
NOTE 1 - NATURE OF OPERATIONS AND GOING CONCERN
The accompanying financial statements have been prepared on the basis
of accounting principles applicable to a "going concern", which assume that the
Company will continue in operation for at least one year and will be able to
realize its assets and discharge its liabilities in the normal course of
operations.
Several conditions and events cast doubt about the Company's ability to
continue as a "going concern". The Company has incurred net losses of
approximately $794,000 for the period from April 7, 1997 (inception) to December
31, 2004, has a liquidity problem, and requires additional financing in order to
finance its business activities on an ongoing basis. The Company is actively
pursuing alternative financing and has had discussions with various third
parties, although no firm commitments have been obtained.
The Company's ability to survive will depend on numerous factors
including, but not limited to, the Company's receiving continued financial
support, completing public equity financing, or generating profitable operations
in the future.
These financial statements do not reflect adjustments that would be
necessary if the Company were unable to continue as a "going concern". While
management believes that the actions already taken or planned, will mitigate the
adverse conditions and events which raise doubt about the validity of the "going
concern" assumption used in preparing these financial statements, there can be
no assurance that these actions will be successful.
If the Company were unable to continue as a "going concern", then
substantial adjustments would be necessary to the carrying values of assets, the
reported amounts of its liabilities, the reported revenues and expenses, and the
balance sheet classifications used.
NOTE 2 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of accounting policies for Canglobe International, Inc. is
presented to assist in understanding the Company's financial statements. The
accounting policies conform to generally accepted accounting principles and have
been consistently applied in the preparation of the financial statements.
Organization and Basis of Presentation
The Company was incorporated under the laws of the State of Nevada on
April 7, 1997. The Company ceased all operating activities during the period
from April 7, 1997 to July 9, 1999 and was considered dormant. On July 9, 1999,
the Company obtained a Certificate of renewal from the
F - 8
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
(Continued)
NOTE 2 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Organization and Basis of Presentation (continued)
State of Nevada. During 2000, the Company developed an Internet website which
provided community, content and commerce for the sportbike and motorcycle
enthusiast. During November 2001, the Company abandoned the internet business
and since December 2001, the Company is in the development stage, and has not
commenced planned principal operations. On March 19, 2002, the Company's name
was changed from eSportbike.com, Inc. to Red Butte Energy, Inc. to reflect the
new focus of the Company. On January 16, 2003, the Company changed its name to
Canglobe International, Inc.
Nature of Business
The company has no products or services as of December 31, 2004. The
Company was organized as a vehicle to seek merger or acquisition candidates. The
Company intends to acquire interests in various business opportunities, which in
the opinion of management will provide a profit to the Company.
Subsequent to the name change and change of direction of the Company,
it pursued opportunities in the tire recycling and rubber reclamation industry,
which has subsequently been abandoned.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.
Pervasiveness of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles required management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
F - 9
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
(Continued)
NOTE 2 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Revenue Recognition
Revenue is recognized as services are performed.
Loss per Share
Basic loss per share has been computed by dividing the loss for the
year applicable to the common stockholders by the weighted average number of
common shares outstanding during the years. There were no common equivalent
shares outstanding at December 31, 2004 and 2003.
Foreign Currency Translation
The Company's primary functional currency is the U.S. dollar. Monetary
assets and liabilities resulting from transactions with foreign suppliers and
customers are translated at year end exchange rates while income and expense
accounts are translated at average rates in effect during the year. Gains and
losses on translations are included in income.
Reclassifications
Certain reclassifications have been made in the 2003 financial
statements to conform with the 2004 presentation.
Advertising Expense
Advertising costs are expensed when the services are provided.
Income Taxes
The Company has a net operating loss for income taxes. Due to the
regulatory limitations in utilizing the loss, it is uncertain whether the
Company will be able to realize a benefit from these losses. Therefore, a
deferred tax asset has not been recorded. There are no significant tax
differences requiring deferral.
F - 10
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
(Continued)
NOTE 2 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Concentrations of Credit Risk
The Company has no significant off-balance-sheet concentrations of
credit risk such as foreign exchange contracts, options contracts or other
foreign hedging arrangements.
Depreciation
Fixed assets are stated at cost. Depreciation and amortization is
calculated on a straight-line basis over the estimated useful lives of the
assets as follows:
Asset Rate
------------------------------------------------ -----------------
Computer equipment 3 years
Furniture and equipment 5 years
Maintenance and repairs are charged to operations; betterments are
capitalized. The cost of property sold or otherwise disposed of and the
accumulated depreciation thereon are eliminated from the property and related
accumulated depreciation accounts, and any resulting gain or loss is credited or
charged to income.
NOTE 3 - COMMITMENTS
As of December 31, 2004, all activities of the Company have been
conducted by corporate officers from either their homes or business offices.
Currently, there are no outstanding debts owed by the company for the use of
these facilities and there are no commitments for future use of the facilities.
NOTE 4 - SHAREHOLDER ADVANCES
Shareholders of the Company have advanced the Company money in order to
pay general and administrative expenses. As of December 31, 2004 and 2003, the
Company owed $12,994 and $2,537, respectively, relating to these notes.
F - 11
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
(Continued)
NOTE 5 - STOCK SPLIT
On May 6, 1999, the Board of Directors authorized 1,000 to 1 stock
split, changed the authorized number of shares to 100,000,000 shares and the par
value to $.001 for the Company's common stock. As a result of the split, 999,000
shares were issued.
On February 23, 2000, the Board of Directors authorized the acceptance
of 800,000 shares of restricted common stock returned to the Company by and on
behalf of Mr. Daniel L. Hodges, formerly the sole Officer and Director of the
Company. The 800,000 shares were canceled immediately upon receipt. Also on
February 23, 2000 the Board of Directors authorized a 27 to 1 stock split. As a
result of this split the Company issued 5,200,000 shares of common stock.
On March 19, 2002, the Board of Directors approved a 1 for 8 reverse
stock split. All references in the accompanying financial statements to the
number of common shares and per-share amounts have been restated to reflect the
stock split and cancellation of shares.
NOTE 6 - COMMON STOCK TRANSACTIONS
On June 24, 2002, the Company issued 300,000 shares of common stock for
$198,000 in consulting services to be performed over a six month period.
On October 31, 2003, the board of directors approved a debt to equity
transaction, where $280,228 in debt was converted into 700,570 shares of
restricted common stock.
NOTE 7 - SUBSEQUENT EVENTS
On January 27, 2005, the Company negotiated with its creditors a
settlement agreement. Under this agreement, the creditors received a convertible
promissory note. The promissory note is due December 31, 2005 and carries a 10
percent interest rate. The promissory note is convertible on demand to common
shares on the basis of 20 percent of the current market value of the shares.
On February 2, 2005, the creditors converted their convertible
promissory notes into 26,987,568 shares of common stock.
F - 12
CANGLOBE INTERNATIONAL, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
THE YEARS ENDED DECEMBER 31, 2004 AND 2003
(Continued)
NOTE 7 - SUBSEQUENT EVENTS (Continued)
On December 17, 2004, the Board of Directors approved a 6 to 1 stock
split of the Company's common stock, effective February 24, 2005. The stock
split increased the number of outstanding common shares from 3,050,577 to
18,303,462 as of December 31, 2004. All references to the Company's common stock
in the financial statements have been restated to reflect the stock split.
F - 13
SIGNATURES
Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on it behalf by the undersigned, thereunto duly authorized.
CANGLOBE INTERNATIONAL, INC.
Dated: March 24, 2005 By /S/ James Baker
---------------------------------
James Baker
President and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the Registrant and in the capacities indicated on this 24th day of March 2005.
Signatures Title
/S/ James Baker
James Baker President and Director
(Principal Executive Officer)
/S/ David Alexander
David Alexander Director, Treasurer, Secretary
(Principal Financial and Accounting
Officer)
/S/ Donald Getty
Donald Getty Director
/S/ Donald Sampson Director
----------------------
Donald Sampson
20