As filed with the Securities and Exchange Commission on December 28, 2011
Registration No. 333-177567
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Amendment 2 to
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
GLOBAL LINES INC.
(Name of small business issuer in its charter)
Nevada 4700 EIN 99-0367049
(State or Other Jurisdiction of (Primary Standard Industrial (IRS Employer
Incorporation or Organization) Classification Number) Identification Number)
16400 Collins Avenue unit 2142
Sunny Isles Beach FL 33160
954-889-7573
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
INCORP SERVICES, INC.
2360 Corporate Circle Suite 400, Henderson NV 89074-7722
Tel: (702) 866-2500, Fax: (702) 866-2689
(Address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Kevin A. Polis, Esq.
Carrillo Huettel, LLP
3033 Fifth Avenue, Suite 400
San Diego, CA 92103
Tel: (619) 546-6100, Fax: (619) 546-6060
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
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]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering: [ ]
If this form is a post-effective registration statement filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering: [ ]
If this form is a post-effective registration statement filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering: [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (check one):
Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ]
Smaller reporting company |X| (Do not check if a smaller reporting company)
CALCULATION OF REGISTRATION FEE
===========================================================================================================
Title of Each Class Proposed Maximum Proposed Maximum Amount of
of Securities to be Amount of Shares Offering Price Aggregate Offering Registration
Registered to be Registered per Share (1) Price Fee
-----------------------------------------------------------------------------------------------------------
Common Stock 10,000,000 $ 0.01 $100,000 $ 11.46
===========================================================================================================
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(a) of the Securities Act.
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 SECTION 8(A), MAY
DETERMINE.
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PROSPECTUS
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
GLOBAL LINES INC
UP TO A MAXIMUM OF 10,000,000 COMMON SHARES
AT $0.01 PER COMMON SHARE
This is the initial offering of common stock of Global Lines Inc. and no public
market currently exists for the securities being offered. We are offering for
sale a total of 10,000,000 shares of common stock at a fixed price of $.01 per
share. There is no minimum number of shares that must be sold by us for the
offering to proceed, and we will retain the proceeds from the sale of any of the
offered shares.
There is no minimum amount of shares that we must sell in our direct offering,
and therefore no minimum amount of proceeds will be raised. No arrangements have
been made to place funds into escrow or any similar account. Sergejs Belkovs, an
officer and director of Global Lines Inc. intends to sell the common shares
directly. No commission or other compensation related to the sale of the common
shares will be paid to Mr. Sergejs Belkovs. The intended methods of
communication include, without limitations, telephone, and personal contact.
Offering Price Proceeds to Company
Per Share Commissions Before Expenses
--------- ----------- ---------------
Common Stock $ 0.01 Not Applicable $100,000
Total $ 0.01 Not Applicable $100,000
Global Lines Inc. is a development stage company and currently has no
operations. Any investment in the shares offered herein involves a high degree
of risk. You should only purchase shares if you can afford a loss of your
investment. Our independent registered public accountant has issued an audit
opinion for Global Lines Inc. which includes a statement expressing substantial
doubt as to our ability to continue as a going concern.
There has been no market for our securities and a public market may never
develop, or, if any market does develop, it may not be sustained. Our common
stock is not traded on any exchange or on the over-the-counter market. After the
effective date of the registration statement relating to this prospectus, we
hope to have a market maker file an application with the Financial Industry
Regulatory Authority ("FINRA") for our common stock to be eligible for trading
on the Over-the-Counter Bulletin Board. We do not yet have a market maker who
has agreed to file such application. There can be no assurance that our common
stock will ever be quoted on a stock exchange or a quotation service or that any
market for our stock will develop.
THE PURCHASE OF THE SECURITIES OFFERED THROUGH THIS PROSPECTUS INVOLVES A HIGH
DEGREE OF RISK. YOU SHOULD CAREFULLY READ AND CONSIDER THE SECTION OF THIS
PROSPECTUS ENTITLED "RISK FACTORS" ON PAGES 5 THROUGH 9 BEFORE BUYING ANY
SHARES OF GLOBAL LINES INC.'S COMMON STOCK.
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED
OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE WILL
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE U.S.
SECURITIES COMMISSION HAS BEEN CLEARED OF COMMENTS AND IS DECLARED EFFECTIVE.
THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT
SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OF SALE
IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED DECEMBER 27, 2011
TABLE OF CONTENTS
PROSPECTUS SUMMARY 3
RISK FACTORS 5
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 9
USE OF PROCEEDS 9
DETERMINATION OF OFFERING PRICE 9
DILUTION 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS 10
DESCRIPTION OF BUSINESS 14
LEGAL PROCEEDINGS 16
DIRECTORS, EXECUTIVE OFFICERS, PROMOTER AND CONTROL PERSONS 16
EXECUTIVE COMPENSATION 17
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 18
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 18
PLAN OF DISTRIBUTION 19
DESCRIPTION OF SECURITIES 20
DISCLOSURE OF COMMISSION POSITION INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES 20
LEGAL MATTERS 21
INTERESTS OF NAMED EXPERTS AND COUNSEL 21
EXPERTS 21
AVAILABLE INFORMATION 21
FINANCIAL STATEMENTS 21
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE 21
WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR OTHER PERSON TO GIVE ANY
INFORMATION OR REPRESENT ANYTHING NOT CONTAINED IN THIS PROSPECTUS. YOU SHOULD
NOT RELY ON ANY UNAUTHORIZED INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO
SELL OR BUY ANY SHARES IN ANY STATE OR OTHER JURISDICTION IN WHICH IT IS
UNLAWFUL. THE INFORMATION IN THIS PROSPECTUS IS CURRENT AS OF THE DATE ON THE
COVER. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS.
2
PROSPECTUS SUMMARY
AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT OTHERWISE REQUIRES, "WE," "US,"
"OUR," AND "GLOBAL LINES INC." REFERS TO GLOBAL LINES INC. THE FOLLOWING SUMMARY
IS NOT COMPLETE AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE
IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN
INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK.
GLOBAL LINES INC.
We are a development stage company which is in a limousine service. Global lines
Inc. will be actively engaged in providing chauffeuring and transportation
services to residents within its local Florida market. Global Lines Inc. was
incorporated in Nevada on June 6, 2011. We intend to use the net proceeds from
this offering to develop our business operations (See "Description of Business"
and "Use of Proceeds"). To implement our plan of operations ($19,000) and pay
ongoing legal fee associated with this offering ($8,000) we require a minimum of
$27,000 for the next twelve months as described in our Plan of Operations. Being
a development stage company, we have very limited operating history. Our
principal executive offices are located at 16400 Collins Avenue unit 2142 Sunny
Isles Beach FL 33160. Our phone number is (973) 851-6863.
From inception until the date of this filing, we have had very limited operating
activities. Our financial statements from inception (June 6, 2011) through
November 30, 2011, reports no revenues and a net loss of $5,602. Our independent
registered public accounting firm has issued an audit opinion for Global Lines
Inc. which includes a statement expressing substantial doubt as to our ability
to continue as a going concern.
We expect to sell our services average for $60 per hour. Our sole source of
revenue from operating will be the selling transportation services.
Global Lines Inc. started operations in the limousine business on June 6,
2011.Global lines Inc. will be engaged in providing chauffeuring and
transportation services to residents within its local Florida market. We will
primarily provide transportation services such as private school student
transport, sightseeing trips, and elderly transportation. We will also offer
transportation to the airport and special event such as proms and weddings. We
hope to serve a repeat clientele who demand--and can afford--reliable, secure
service from drivers with detailed knowledge of the area.
To implement our plan of operations ($19,000) and pay ongoing legal fee
associated with this offering ($8,000) we require a minimum of $27,000 for the
next twelve months as described in our Plan of Operations. Our monthly burn rate
is approximately $2,250. This is a simple monthly estimate of expenses which
includes all the expenses described in our plan of operations. It is calculated
by dividing $27,000 by 12 months. The present capital will not be sufficient to
fund our operation for any period of time at this burn rate. We depend on funds
from this public offering. We will utilize funds from Sergejs Belkovs, our Sole
Officer and Director, who has informally agreed to advance funds to allow us to
pay for professional fees, including fees payable in connection with the filing
of this registration statement and operation expenses, however he has no formal
commitment, arrangement or legal obligation to advance or loan funds to the
company.
A more detailed breakdown of costs is included in our plan of operations. The
month on which we will run out of funds will depend on the amount of funds we
raise in this offering.
We do not anticipate earning revenues until such time as we enter into
commercial operation. Since we are presently in the development stage of our
business, we can provide no assurance that we will successfully sell our
services.
As of the date of this prospectus, there is no public trading market for our
common stock and no assurance that a trading market for our securities will ever
develop.
3
THE OFFERING
The Issuer: GLOBAL LINES INC
Securities Being Offered: 10,000,000 shares of common stock
Price Per Share: $0.01
Duration of the Offering: The offering shall terminate on the earlier of (i)
the date when the sale of all 10,000,000 shares is
completed, (ii) when the Board of Directors
decides that it is in the best interest of the
Company to terminate the offering prior the
completion of the sale of all 10,000,000 shares
registered under the Registration Statement of
which this Prospectus is part.
Net Proceeds: $100,000
Securities Issued and
Outstanding: There are 5,000,000 shares of common stock issued
and outstanding as of the date of this prospectus.
4,500,000 shares held by our President, Sergejs
Belkovs.
500,000 shares held by our Secretary Vladislav
Novichenko
Registration Costs: We estimate our total offering registration costs
to be approximately $8,000.
Risk Factors: See "Risk Factors" and the other information in
this prospectus for a discussion of the factors
you should consider before deciding to invest in
shares of our common stock.
4
RISK FACTORS
An investment in our common stock involves a high degree of risk. You should
carefully consider the risks described below and the other information in this
prospectus before investing in our common stock. If any of the following risks
occur, our business, operating results and financial condition could be
seriously harmed. The trading price of our common stock, when and if we trade at
a later date, could decline due to any of these risks, and you may lose all or
part of your investment.
RISKS ASSOCIATED TO OUR BUSINESS
WE ARE A DEVELOPMENT STAGE COMPANY BUT HAVE NOT YET COMMENCED OPERATIONS IN OUR
BUSINESS. WE EXPECT TO INCUR OPERATING LOSSES FOR THE FORESEEABLE FUTURE.
We were incorporated on June 6, 2011 and to date have been involved primarily in
organizational activities. We have not yet commenced business operations.
Accordingly, we have no way to evaluate the likelihood that our business will be
successful. We have not earned any revenues as of the date of this prospectus.
Potential investors should be aware of the difficulties normally encountered by
new transportations companies and the high rate of failure of such enterprises.
The likelihood of success must be considered in light of the problems, expenses,
difficulties, complications and delays encountered in connection with the
operations that we plan to undertake. These potential problems include, but are
not limited to, unanticipated problems relating to the ability to generate
sufficient cash flow to operate our business, and additional costs and expenses
that may exceed current estimates. We expect to incur significant losses into
the foreseeable future. We estimate "significant losses" to be up to $100,000
which is our maximum offering. Our losses could be higher after the first twelve
month period. We recognize that if the effectiveness of our business plan is not
forthcoming, we will not be able to continue business operations. There is no
history upon which to base any assumption as to the likelihood that we will
prove successful, and it is doubtful that we will generate any operating
revenues or ever achieve profitable operations. If we are unsuccessful in
addressing these risks, our business will most likely fail.
WITHOUT THE FUNDING FROM THIS OFFERING WE WILL BE UNABLE TO IMPLEMENT OUR
BUSINESS PLAN.
Our current operating funds are less than necessary to complete our intended
operations of operating a chauffeuring and transportation services business. We
will need the funds from this offering to commence activities listed in our
business plan. As of November 30, 2011, we had cash in the amount of $1,002 and
liabilities of $5,604. We currently do not have any operations and we have no
income.
WE HAVE YET TO EARN REVENUE AND OUR ABILITY TO SUSTAIN OUR OPERATIONS IS
DEPENDENT ON OUR ABILITY TO RAISE FINANCING FROM THIS OFFERING. AS A RESULT,
THERE IS SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.
We have accrued net losses of $5,604 for the period from our inception on June
6, 2011 to November 30, 2011, and have no revenues to date. Our future is
dependent upon our ability to obtain financing from this offering. Further, the
finances required to fully develop our plan cannot be predicted with any
certainty and may exceed any estimates we set forth. These factors raise
substantial doubt that we will be able to continue as a going concern. Sadler,
Gibb & Associates, our independent registered public accountant, has expressed
substantial doubt about our ability to continue as a going concern. This opinion
could materially limit our ability to raise funds. If we fail to raise
sufficient capital when needed, we will not be able to complete our business
plan. As a result we may have to liquidate our business and you may lose your
investment. You should consider our independent registered public accountant's
comments when determining if an investment in Global Lanes Inc. is suitable.
WE MAY FACE DAMAGE TO OUR PROFESSIONAL REPUTATION IF OUR FUTURE CLIENTS ARE NOT
SATISFIED WITH OUR SERVICES. IN THIS CASE, IT IS UNLIKELY THAT WE WILL BE ABLE
TO OBTAIN FUTURE ENGAGEMENTS. IF WE ARE UNABLE TO OBTAIN ENGAGEMENTS, INVESTORS
ARE LIKELY TO LOSE THEIR ENTIRE INVESTMENT.
5
As a transportation service firm, we depend and will continue to depend to a
large extent on referrals and new engagements from our former customers as we
will attempt to establish a reputation for professional service company and
integrity to attract and customers. As a result, if a customer is not satisfied
with our services, such lack of satisfaction may be more damaging to our
business than it may be to other businesses. Accordingly, no assurances can be
given that we will obtain customers in the foreseeable future.
IF WE DO NOT ATTRACT CUSTOMERS, WE WILL NOT MAKE A PROFIT, WHICH ULTIMATELY WILL
RESULT IN A CESSATION OF OPERATIONS.
We currently have no customers to purchase ours services. We have not identified
any customers and we cannot guarantee we ever will have any customers. Even if
we obtain customers, there is no guarantee that we will generate a profit. If we
cannot generate a profit, we will have to suspend or cease operations. You are
likely to lose your entire investment if we cannot sell any of our services at
prices which generate a profit.
WE ARE SUBJECT TO BUSINESS RISKS AND INCREASING COSTS ASSOCIATED WITH THE
TRANSPORTATION INDUSTRY THAT ARE LARGELY OUT OF OUR CONTROL, ANY OF WHICH COULD
HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS, FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
We are subject to business risks and increasing costs associated with the
transportation industry that are largely out of our control, any of which could
adversely affect our business, financial condition and results of operations.
The factors contributing to these risks and costs include weather, excess
capacity in the transportation industry, interest rates, fuel prices and taxes,
fuel surcharge collection, impact on liquidity from the lag between higher
payments for fuel and the collection of higher fuel surcharges in a rising fuel
cost environment, terrorist attacks, insurance premiums and self-insurance
levels, difficulty in recruiting and retaining qualified drivers, the risk of
outbreak of epidemical illnesses, the risk of widespread disruption of our
technology systems, and increasing equipment and operational costs. Our results
of operations may also be affected by seasonal factors.
THE LIMOUSINE INDUSTRY IS CYCLICAL AND IS SENSITIVE TO CHANGING ECONOMIC
CONDITIONS; WE ARE IN THE MIDST OF AN INDUSTRY AND GENERAL ECONOMIC SLOWDOWN OR
RECESSION THAT COULD MATERIALLY ADVERSELY IMPACT OUR BUSINESS.
Limousine services historically have been subject to substantial cyclical
variation characterized by periods of oversupply and weak demand. We believe
that many factors affect the industry, including consumer confidence in the
economy, the level of personal discretionary spending, interest rates, fuel
prices, credit availability and unemployment rates. At this time, we cannot
predict the severity or duration of the slowdown and we cannot assure that our
business will not be materially adversely affected if it continues or worsens.
Accordingly, you are likely to lose your entire investment if the current slump
in transportation services continues.
WE OPERATE IN A HIGHLY COMPETITIVE ENVIRONMENT, AND IF WE ARE UNABLE TO COMPETE
WITH OUR COMPETITORS, OUR BUSINESS, FINANCIAL CONDITION, RESULTS OF OPERATIONS,
CASH FLOWS AND PROSPECTS COULD BE MATERIALLY ADVERSELY AFFECTED.
We operate in a highly competitive environment. Our competition includes small
and midsized companies, and many of them may sell the same services at
competitive prices. Highly competitive environment could materially adversely
affect our business, financial condition, results of operations, cash flows and
prospects.
BECAUSE WE DO NOT HAVE AN ESCROW OR TRUST ACCOUNT FOR YOUR SUBSCRIPTION, IF WE
FILE FOR BANKRUPTCY PROTECTION OR ARE FORCED INTO BANKRUPTCY, OR A CREDITOR
OBTAINS A JUDGMENT AGAINST US AND ATTACHES THE SUBSCRIPTION.
6
Your funds will not be placed in an escrow or trust account. Accordingly, if we
file for bankruptcy protection or a petition for involuntary bankruptcy is filed
by creditors against us, your funds will become part of the bankruptcy estate
and administered according to the bankruptcy laws. If a creditor sues us and
obtains a judgment against us, the creditor could garnish the bank account and
take possession of the subscriptions. As such, it is possible that a creditor
could attach your subscription which could preclude or delay the return of money
to you.
IF WE ARE UNABLE TO RECRUIT, MOTIVATE AND RETAIN QUALIFIED DRIVERS, OUR
BUSINESS, FINANCIAL CONDITION, RESULTS OF OPERATIONS AND CASH FLOWS COULD BE
MATERIALLY AND ADVERSELY AFFECTED.
The success of our business will depend upon our ability to attract and retain
through independent contractor or other arrangements, qualified drivers who
possess the skills and experience necessary to meet the needs of our operations.
We will compete in markets in which unemployment is generally relatively low and
the competition for independent drivers and other employees is intense. In
addition, the independent drivers we hope to utilize will be responsible for all
vehicle expense including maintenance, insurance, fuel and all other operating
costs. We will make every reasonable effort to include fuel cost adjustments in
customer billings that are paid to independent drivers to offset the impact of
fuel price increases. However, if future fuel cost adjustments are insufficient
to offset independent drivers' costs, we may be unable to attract a sufficient
number of independent drivers.
We cannot assure that qualified drivers will be available in sufficient numbers
and on terms acceptable to us. The inability to attract and retain qualified
drivers, could materially and adversely affect our business, financial
condition, results of operations and cash flows.
BECAUSE OUR CURRENT PRESIDENT AND EXECUTIVE OFFICER DEVOTE LIMITED AMOUNT OF
TIME TO THE COMPANY, THEY MAY NOT BE ABLE OR WILLING TO DEVOTE A SUFFICIENT
AMOUNT OF TIME TO OUR BUSINESS OPERATIONS, CAUSING OUR BUSINESS TO FAIL.
Sergejs Belkovs, our President, currently devotes approximately twenty hours per
week providing management services to us. While he presently possesses adequate
time to attend to our interest, it is possible that the demands on him from
other obligations could increase, with the result that he would no longer be
able to devote sufficient time to the management of our business. The loss of
Mr. Belkovs to our company could negatively impact our business development.
Vladislav Novichenko, our executive officer, currently devotes approximately
twenty hours per week providing management services to us. While he presently
possesses adequate time to attend to our interest, it is possible that the
demands on him from other obligations could increase, with the result that he
would no longer be able to devote sufficient time to the management of our
business. The loss of Mr. Novichenko to our company could negatively impact our
business development.
OUR EXECUTIVE OFFICERS AND DIRECTOR DO NOT HAVE ANY PRIOR EXPERIENCE CONDUCTING
A BEST-EFFORT OFFERING, OR MANAGING A PUBLIC COMPANY
Our executive officers and director do not have any experience conducting a
best-effort offering or managing a public company. Consequently, we may not be
able to raise any funds or run our public company successfully. If we are not
able to raise sufficient funds, we may not be able to fund our operations as
planned, and our business will suffer and your investment may be materially
adversely affected. Also, our executive's officers' and director's lack of
experience of managing a public company could cause you to lose some or all of
your investment.
THERE IS NO MINIMUM NUMBER OF SHARES THAT HAS TO BE SOLD IN ORDER FOR THE
OFFERING TO PROCEED
We do not have a minimum amount of funding set in order to proceed with the
offering. If not enough money is raised to begin operations, you might lose your
entire investment because we may not have enough funds to implement our business
plan.
7
RISKS ASSOCIATED WITH THIS OFFERING
THE TRADING IN OUR SHARES WILL BE REGULATED BY THE SECURITIES AND EXCHANGE
COMMISSION RULE 15G-9 WHICH ESTABLISHED THE DEFINITION OF A "PENNY STOCK."
The shares being offered are defined as a penny stock under the Securities and
Exchange Act of 1934, as amended (the "Exchange Act"), and rules of the
Commission. The Exchange Act and such penny stock rules generally impose
additional sales practice and disclosure requirements on broker-dealers who sell
our securities to persons other than certain accredited investors who are,
generally, institutions with assets in excess of $5,000,000 or individuals with
net worth in excess of $6,000,000 or annual income exceeding $200,000 ($300,000
jointly with spouse), or in transactions not recommended by the broker-dealer.
For transactions covered by the penny stock rules, a broker dealer must make
certain mandated disclosures in penny stock transactions, including the actual
sale or purchase price and actual bid and offer quotations, the compensation to
be received by the broker-dealer and certain associated persons, and deliver
certain disclosures required by the Commission. Consequently, the penny stock
rules may make it difficult for you to resell any shares you may purchase, if at
all.
WE ARE SELLING THIS OFFERING WITHOUT AN UNDERWRITER AND MAY BE UNABLE TO SELL
ANY SHARES.
This offering is self-underwritten, that is, we are not going to engage the
services of an underwriter to sell the shares; we intend to sell our shares
through our President, who will receive no commissions. He will offer the shares
to friends, family members, and business associates, however, there is no
guarantee that he will be able to sell any of the shares. Unless he is
successful in selling all of the shares and we receive the proceeds from this
offering, we may have to seek alternative financing to implement our business
plan. We do not have any plans where to seek this alternative financing at
present time.
DUE TO THE LACK OF A TRADING MARKET FOR OUR SECURITIES, YOU MAY HAVE DIFFICULTY
SELLING ANY SHARES YOU PURCHASE IN THIS OFFERING.
We are not registered on any market or public stock exchange. There is presently
no demand for our common stock and no public market exists for the shares being
offered in this prospectus. We plan to contact a market maker immediately
following the completion of the offering and apply to have the shares quoted on
the Over-the-Counter Bulletin Board ("OTCBB"). The OTCBB is a regulated
quotation service that displays real-time quotes, last sale prices and volume
information in over-the-counter securities. The OTCBB is not an issuer listing
service, market or exchange. Although the OTCBB does not have any listing
requirements per se, to be eligible for quotation on the OTCBB, issuers must
remain current in their filings with the SEC or applicable regulatory authority.
Market makers are not permitted to begin quotation of a security whose issuer
does not meet this filing requirement. Securities already quoted on the OTCBB
that become delinquent in their required filings will be removed following a 30
to 60 day grace period if they do not make their required filing during that
time. We cannot guarantee that our application will be accepted or approved and
our stock listed and quoted for sale. As of the date of this filing, there have
been no discussions or understandings between Global Lines Inc. and anyone
acting on our behalf, with any market maker regarding participation in a future
trading market for our securities. If no market is ever developed for our common
stock, it will be difficult for you to sell any shares you purchase in this
offering. In such a case, you may find that you are unable to achieve any
benefit from your investment or liquidate your shares without considerable
delay, if at all. In addition, if we fail to have our common stock quoted on a
public trading market, your common stock will not have a quantifiable value and
it may be difficult, if not impossible, to ever resell your shares, resulting in
an inability to realize any value from your investment.
WE WILL INCUR ONGOING COSTS AND EXPENSES FOR SEC REPORTING AND COMPLIANCE.
WITHOUT REVENUE WE MAY NOT BE ABLE TO REMAIN IN COMPLIANCE, MAKING IT DIFFICULT
FOR INVESTORS TO SELL THEIR SHARES, IF AT ALL.
Our business plan allows for the payment of the estimated $8,000 cost of this
registration statement to be paid from existing cash on hand. If necessary,
8
Sergejs Belkovs, our Chairman, has verbally agreed to loan the company funds to
complete the registration process. We plan to contact a market maker immediately
following the close of the offering and apply to have the shares quoted on the
OTC Electronic Bulletin Board. To be eligible for quotation, issuers must remain
current in their filings with the SEC. In order for us to remain in compliance
we will require future revenues to cover the cost of these filings, which could
comprise a substantial portion of our available cash resources. If we are unable
to generate sufficient revenues to remain in compliance it may be difficult for
you to resell any shares you may purchase, if at all.
FORWARD LOOKING STATEMENTS
This prospectus contains forward-looking statements that involve risk and
uncertainties. We use words such as "anticipate", "believe", "plan", "expect",
"future", "intend", and similar expressions to identify such forward-looking
statements. Investors should be aware that all forward-looking statements
contained within this filing are good faith estimates of management as of the
date of this filing. Our actual results could differ materially from those
anticipated in these forward-looking statements for many reasons, including the
risks faced by us as described in the "Risk Factors" section and elsewhere in
this prospectus.
USE OF PROCEEDS
Our offering is being made on a self-underwritten basis: no minimum number of
shares must be sold in order for the offering to proceed. The offering price per
share is $0.01. The following table sets forth the uses of proceeds assuming the
sale of 25%, 50%, 75% and 100%, respectively, of the securities offered for sale
by the Company. There is no assurance that we will raise the full $100,000 as
anticipated.
$25,000 $50,000 $75,000 $100,000
------- ------- ------- --------
Legal and professional fees $ 8,000 $ 8,000 $ 8,000 $ 8,000
Net proceeds $17,000 $42,000 $67,000 $92,000
The net proceed will be used:
Marketing, advertising , web
development $ 2,400 $ 5,000 $ 5,000 $ 5,000
Establishing an office $ 1,000 $ 1,000 $ 1,000 $ 1,000
Miscellaneous expenses $ 1,600 $ 3,600 $ 4,800 $ 6,400
Cars $12,000 $32,400 $56,200 $79,600
We intend to purchase cars utilizing proceed from this offering and funds from
Sergejs Belkovs if necessary. We do not plan to lease our cars. We plan to hire
independent drivers on on-call basis who will be compensated solely by
commission payments from their jobs. The payment to the drivers will come from
sales to our customers. Proceeds of this offering will not be used to pay our
drivers. We may also hire independent drivers who own their own cars. The
commission payment to such drivers will be higher than to the drivers that use
our cars.
Miscellaneous expenses include: car wash, licensing and permitting expenses, and
any unexpected expenses. We owe an obligation of $8,000 for purchase of our
first vehicle. Our director has agreed informally to advance us funds to pay for
this obligation. This loan will be non-interest bearing and payable upon demand.
The above figures represent only estimated cost. If necessary, Sergejs Belkovs,
our president, has verbally agreed to loan the company funds to complete the
registration process and to implement our complete business plan.
DETERMINATION OF OFFERING PRICE
The offering price of the shares has been determined arbitrarily by us. The
price does not bear any relationship to our assets, book value, earnings, or
other established criteria for valuing a privately held company. In determining
the number of shares to be offered and the offering price, we took into
consideration our cash on hand and the amount of money we would need to
implement our business plan. Accordingly, the offering price should not be
considered an indication of the actual value of the securities.
9
DILUTION
Dilution represents the difference between the offering price and the net
tangible book value per share immediately after completion of this offering. Net
tangible book value is the amount that results from subtracting total
liabilities and intangible assets from total assets. Dilution arises mainly as a
result of our arbitrary determination of the offering price of the shares being
offered. Dilution of the value of the shares you purchase is also a result of
the lower book value of the shares held by our existing stockholders.
The price of the current offering is fixed at $0.01 per common share. This price
is significantly higher than the price paid by our director and officers for
common equity since the Company's inception on June 6, 2011. There are 5,000,000
shares of common stock issued and outstanding as of the date of this prospectus.
Sergejs Belkovs, our director and president, paid $.001 per share for the
4,500,000 common shares. Vladislav Novichenko, our secretary, paid $.001 per
share for 500,000 common shares.
Assuming completion of the offering, there will be up to 15,000,000 common
shares outstanding. The following table illustrates the per common share
dilution that may be experienced by investors at various funding levels.
Funding Level $100,000 $75,000 $50,000 $25,000
------------- -------- ------- ------- -------
Offering price $0.01 $0.01 $0.01 $0.01
Net tangible book $0.001 $0.001 $0.001 $ .001
value per common
share before offering
Increase per common $0.0061 $0.0054 $0.0045 $0.0030
share attributable
to investors
Pro forma net tangible $0.0070 $0.0064 $0.0055 $0.0039
book value per common
share after offering
Dilution to investors $0.0030 $0.0036 $0.0045 $0.0061
Dilution as a 30% 36% 45% 61%
percentage of
offering price
Based on 5,000,000 common shares outstanding as of August 31, 2011 and total
stockholder's equity of $3,996 utilizing audited August 31, 2011 financial
statements.
As of August 31, 2011, the net tangible book value of our shares of common stock
was $4,500 or approximately $ 0.001 per share based upon 4,500,000 shares
outstanding.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Our cash balance is $1,002 as of November 30, 2011. We believe our cash balance
is not sufficient to fund our limited levels of operations for any period of
time. We have been utilizing and may utilize funds from Sergejs Belkovs, our
President, who has informally agreed to advance funds to us. Mr. Sergejs
Belkovs, however, has no formal commitment, arrangement or legal obligation to
advance or loan funds to the company. In order to achieve our business plan
goals, we will need the funding from this offering. We are a development stage
company and have generated no revenue to date.
Our independent registered public accountant has issued a going concern opinion.
This means that there is substantial doubt that we can continue as an on-going
business for the next twelve months unless we obtain additional capital to pay
our bills. This is because we have not generated revenues and no revenues are
anticipated until we complete our initial business development. There is no
assurance we will ever reach that stage.
10
To meet our need for cash we are attempting to raise money from this offering.
We believe that we will be able to raise enough money through this offering to
expand operations but we cannot guarantee that once we expand operations we will
stay in business after doing so. If we are unable to successfully find customers
we may quickly use up the proceeds from this offering and will need to find
alternative sources. At the present time, we have not made any arrangements to
raise additional cash, other than through this offering.
PLAN OF OPERATION
Our sales and marketing strategy is to move as quickly as possible into the
three designated market segments (Sight-seeing, Private School Transportation,
and Elderly Transport). The marketing thrust will consist of direct contact to
the responsible person at selected private schools, the creation and
distribution of color brochures to Inns, Bed and Breakfasts, Assisted Living and
Retirement Communities, and direct mailing to new high worth individuals using
the resources of a list company. Our sources of cash will be mainly the proceeds
from this offering and also the proceeds from our revenues, and loans from our
directors. We expect to start generating revenue by selling our services by 3rd
month of our Plan of Operations, after we set up our office.
We will not be conducting any product research or development. We do not expect
to purchase or sell plant or significant equipment. Further we do not expect
significant changes in the number of employees. Upon completion of our public
offering, our specific goal is to profitably sell ours services. Our plan of
operations is as follows:
SET UP OFFICE AND START ADVERTISING SIGHTSEEING TOURS
Timeframe - 1st-2nd month Estimated Cost: $1400
1) Establish our working place and office. Computer (laptop) $500, office
table and chairs $500.
2) Purchase membership from a local car wash for unlimited car washes.
3) Begin advertising limo sightseeing tours by printing advertising materials
such as brochure explaining ours services and placing them in local hotels.
4) Launch our referral program with hotel concierges and front desk personal.
They will earn 10% referral fee from referred transactions. This referral
strategy will also be directed towards wedding and event planners with view
to sell transportation services for these events. Printing of brochures:
$300
DEVELOP OUR WEBSITE AND DISTRIBUTE PROMOTIONAL MATERIAL TO PRIVATE SCHOOLS
Timeframe - 3rd -4th month Estimated Cost: $ 950
1) Hire an independent contractor to develop our website. Our website will be
used to list our services and our contact information. Cost of web site
developing $500. Twelve month hosting with registration of our domain costs
$150(www. hostgator.com).
2) We will start advertising in private schools by sending a cover letter and
color brochure. Printing of brochures for private schools: $300
START ADVERTISING ELDERLY TRANSPORTATION OPERATIONS Timeframe - 5th-6th month
Estimated Cost: $300 1) Start advertising Elderly Transportation services.
2) Print and distribute advertising brochure in senior communities, homes, and
medical care centers. Printing of brochure: $300
ONLINE MARKETING
Timeframe - 7th-8th months Estimated Cost: $3,000 (500 monthly)
1) Begin blogging, e-newsletters, social networking, searching engine
optimizer (SEO).
2) Advertise our services at limousine guide websites.
3) Hire an independent contractor for online marketing ($500 monthly).
BUYING CARS. HIRING DRIVERS
Time frame 9th -12th month Minimum Estimated Cost: $12,000
1) Purchase cars for our operations. The number of new cars will depend on the
amount of revenue that we have available. We will purchase 2007-2009
Lincoln Town Cars and 2007-2009 Toyota Highlander (cost per car is $12,000)
11
2) We plan to hire independent drivers on on-call basis who will be
compensated solely by commission payments from their jobs. The payment to
the drivers will come from sales to our customers. We may also hire
independent drivers who own their own cars. The commission payment to such
drivers will be higher than to the drivers that use our cars.We plan to pay
10% of revenue to "Super Limousine" for providing clients to us as per our
agreement with them. We plan to pay our drivers a commission of 30%-60%
depending if they are driving our cars or their own cars. This arrangement
with drivers is customary and drivers typically make $25,000 to $30,000 per
year plus gratitude.
Total: $19000.
To implement our plan of operations ($19,000) and pay ongoing legal fee
associated with this offering ($8,000) we require a minimum of $27,000 for the
next twelve months as described in our Plan of Operations. After twelve months
period we may need additional financing. We do not currently have any
arrangements for additional financing.
We plan on purchasing one car by February 2012 (We have already paid $4,000
deposit for this car). Our director has informally agreed to advance us funds to
complete the purchase of this car (approximately $8,000). According to our plan
of operations, we plan on purchasing a minimum of additional one car after 9th
month following the completion of our public offering. If we raise over $27,000
or if we generate revenue, we will be able to purchase more cars.
Until we start to sell our services, we do not believe that our operations will
be profitable. If we are unable to attract customers to buy our product we may
have to suspend or cease operations. If we cannot generate sufficient revenues
to continue operations, we will suspend or cease operations. If we cease
operations, we do not know what we will do and we do not have any plans to do
anything else.
Sergejs Belkovs, our president will be devoting approximately 50% of his time to
our operations. Once we expand operations, and are able to attract more and more
customers to buy our product, Mr. Sergejs Belkovs has agreed to commit more time
as required. Because Mr.Belkovs will only be devoting limited time to our
operations, our operations may be sporadic and occur at times which are
convenient to him. As a result, operations may be periodically interrupted or
suspended which could result in a lack of revenues and a cessation of
operations.
OFF-BALANCE SHEET ARRANGEMENTS
We have no off-balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources.
RESULTS OF OPERATIONS
FROM INCEPTION ON JUNE 6, 2011 TO NOVEMBER 30, 2011
During the period we incorporated the company, prepared a business plan and
executed an Agreement with "Super Limousines". "Super limousines" agrees to
provide work to Global Lines Inc. collect payment from customer and provide
payment to the Global Lines Inc. "Super limousine" fee shall be calculated as
ten per cent (10%) of the net value of transportation services performed by
Global Lines Inc. The agreement with "Super limousine" will help us kick-start
our transportation business and allow us to obtain new clients to gradually
build our own customer base.
Our loss since inception is $5,602 for filing costs related to the incorporation
of the Company and cost of Nevada business license. In the first quarter we used
our cash we had to pay expenses associated with this offering. We paid $2,500 to
our auditors, $15 registration fee to the SEC and $2,500 as legal fees. Our
current cash on hand will be used to pay the fees and expenses of this offering.
The company put up a deposit for Toyota Highlander or Lincoln Town Car in the
amount of $4,000. The remaining purchase price of the vehicle of $8,000 is due
by February 29, 2012. The company does not intend to sell the vehicle, but
rather to use it in order to generate revenue.
12
Since inception, we have sold a total of 5,000,000 shares of common stock to our
secretary and our director for net proceeds of $5,000.
LIQUIDITY AND CAPITAL RESOURCES
As of November 30, 2011 the Company had $1,002 cash and our liabilities were
$5,604, comprising $5,604 owed to Sergejs Belkovs, our president. Since
inception through November 30, 2011, we have sold 5,000,000 shares of common
stock. Mr. Belkovs our president has paid a price of $0.001 per share, for
aggregate proceeds of $4,500. Mr. Novichenko, our secretary has paid a price of
$0.001 per share, for aggregate proceeds of $500. To meet our need for cash we
are attempting to raise money from this offering. We cannot guarantee that we
will be able to sell all the shares required. If we are successful, any money
raised will be applied to the items set forth in the Use of Proceeds section of
this prospectus. We will attempt to raise the necessary funds to proceed with
all phases of our plan of operation. Proceed of $27,000 from this offering will
likely allow us to operate for at least one year.
As of the date of this registration statement, the current funds available to
the Company will not be sufficient to continue maintaining a reporting status.
The company's director, Sergejs Belkovs, has indicated that he may be willing to
provide funds required to maintain the reporting status in the form of a
non-secured loan for the next twelve months as the expenses are incurred if no
other proceeds are obtained by the Company. However, there is no contract in
place or written agreement securing this agreement. Management believes if the
company cannot maintain its reporting status with the SEC it will have to cease
all efforts directed towards the company. As such, any investment previously
made would be lost in its entirety.
Our auditors have issued a "going concern" opinion, meaning that there is
substantial doubt if we can continue as an on-going business for the next twelve
months unless we obtain additional capital. No substantial revenues are
anticipated until we have completed the financing from this offering and
implemented our plan of operations. Our only source for cash at this time is
investments by others in this offering. We must raise cash to implement our
strategy and stay in business. The amount of the offering will likely allow us
to operate for at least one year and have the capital resources required to
cover the material costs with becoming a publicly reporting. The company
anticipates over the next 12 months the cost of being a reporting public company
will be approximately $8,000.
Management believes that current trends toward lower capital investment in
start-up companies, volatility in the transportation sales market pose the most
significant challenges to the Company's success over the next year and in future
years. Additionally, the Company will have to meet all the financial disclosure
and reporting requirements associated with being a publicly reporting company.
The Company's management will have to spend additional time on policies and
procedures to make sure it is compliant with various regulatory requirements,
especially that of Section 404 of the Sarbanes-Oxley Act of 2002. This
additional corporate governance time required of management could limit the
amount of time management has to implement is business plan and impede the speed
of its operations.
Should the Company fail to sell less than all its shares under this offering the
Company would be forced to scale back or abort completely the implementation of
its 12-month plan of operations.
SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Company reports revenues and expenses using the accrual method of accounting
for financial and tax reporting purposes.
USE OF ESTIMATES
Management uses estimates and assumption in preparing these financial statements
in accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses.
13
DEPRECIATION, AMORTIZATION AND CAPITALIZATION
The Company records depreciation and amortization when appropriate using both
straight-line and declining balance methods over the estimated useful life of
the assets (five to seven years). Expenditures for maintenance and repairs are
charged to expense as incurred. Additions, major renewals and replacements that
increase the property's useful life are capitalized. Property sold or retired,
together with the related accumulated depreciation is removed from the
appropriated accounts and the resultant gain or loss is included in net income.
INCOME TAXES
Global Lines Inc. accounts for its income taxes in accordance with Statement of
Financial Accounting Standards No. 109, "Accounting for Income Taxes." Under
Statement 109, a liability method is used whereby deferred tax assets and
liabilities are determined based on temporary differences between basis used of
financial reporting and income tax reporting purposes. Income taxes are provided
based on tax rates in effect at the time such temporary differences are expected
to reverse. A valuation allowance is provided for certain deferred tax assets if
it is more likely than not, that the Company will not realize the tax assets
through future operations.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Financial Accounting Standards statements No. 107, "Disclosures About Fair Value
of Financial Instruments", requires the Company to disclose, when reasonably
attainable, the fair market values of its assets and liabilities which are
deemed to be financial instruments. The Company's financial instruments consist
primarily of cash.
PER SHARE INFORMATION
The Company computes per share information by dividing the net loss for the
period presented by the weighted average number of shares outstanding during
such period.
DESCRIPTION OF BUSINESS
GENERAL
We were incorporated in the State of Nevada on June 6, 2011. We are involved the
chauffeured transportation business. Global lines Inc. will be providing
chauffeuring and transportation services to residents within its local market.
We will primarily provide transportation services such as private school student
transport, sightseeing trips, and elderly transportation. We will also offer
transportation to the airport and special event such as proms and weddings. We
plan to serve a repeat clientele who demand--and can afford--reliable, secure
service from drivers with detailed knowledge of the area. We have not generated
any revenues to date. We have executed an agreement with "Super Limousines",
developed our business plan and paid deposit of $4,000 on one car to be used for
Limosine Service. Our principal office address is located at 16400 Collins
Avenue unit 2142Sunny Isles Beach FL 33160. Our telephone number is
954-88-97573. Our plan of operation is forward-looking and there is no assurance
that we will ever reach profitable operations. We are a development stage
company and have not earned any revenue. It is likely that we will not be able
to achieve profitability and will have to cease operations due to the lack of
funding.
LIMOUSINE SERVICE
The customer needs in the limousine transportation market are quite diverse.
Corporate and airport transfer clients are mostly interested in reliable and
fast service. For these clients, limousine services save time and add
convenience compared to using public transportation or personal vehicles. Prom
and bachelor party clients are more interested in the social status associated
with the limousine service; however, this segment is less loyal and shops around
for the best value. At the same time, wedding and funeral transportation
clients, who also seek the emotional benefits of using a limousine service, may
be less price sensitive than other segments. Further, the sightseeing segment,
which is currently underserved, does not only need spacious and comfortable
accommodation during the trip, but also benefits from a driver who is very
familiar with the area and who can serve as a guide as well.
14
Global Lines Inc. will concentrate in the areas of private school student
transport, sightseeing trips, and elderly transportation. We believe that these
markets have higher margins and are less price sensitive. According to
www.localschooldirectory.com, Ft Lauderdale has 33 private schools with 32000
students. According to www.broward.org, Ft Lauderdale airport traffic
(December-June 2010) is 10,367,009 passengers--potential clients for the
sightseeing service. There are 150 assisted living facilities in the
area--potential clients for elderly transportation service.
INDUSTRY STATISTICS:
The latest LCT (limousine, charter and tours) Fact Book (http://www.lctmag.com)
statistics:
PROFITS: The average overall percentage profit margin for chauffeured
transportation companies in 2010: 17%, up from 15% in 2009. Small chauffeured
transportation companies recorded an average profit margin of: 21% in 2010,
compared to 18% for 2009.
FLEET VEHICLES: Median number of vehicles in fleet as of 1Q 2011: 8
WAGES: Average hourly wages for Chauffeurs: $13.92
TOP 5 BEST BUSINESS CLIMATES: 1. South Dakota 2. Alaska 3. Wyoming 4. Nevada
5. Florida
MARKETING
The sales and marketing strategy is to focus in following market areas:
(Sight-seeing: creation and Private School Transportation, and Elderly
Transport). We will use the following marketing strategies to build the base of
our clientele:
1. keeping information brochures in the vehicle for clients to read and
keep--to help increase chances of their return
2. brochures distributions to private schools, hotels, assisted living
and retirement centers; offering special incentive and discounts such
as a free hour of limo service with a purchase of 5 or more hours.
3. friendly and helpful customer service to increase the chance of repeat
clientele.
4. creating a mailing list of previous clients.
AGREEMENT
We have executed an agreement with "Super Limousines" under which, Super
Limousines agrees to provide work to Global Lines Inc., collect payment from
customers and provide payment to Global Lines Inc. for performed services The
consideration fee shall be calculated as ten per cent (10%) of the net value of
transportation services sold by the "Super limousines" to customer and performed
by Global Lines Inc. Either party may terminate this agreement at any time by
giving the other party ten (10) days prior written notice.
PRICING
Average hourly cost to hire Limousine in South Florida is $60 (July 2011). We
plan to price our service approximately at the same rate.
COMPETITION
The completion in our industry is extremely high including shuttle service,
taxis and other limousine service. The following companies are an example of
some of our competitors in South Florida: Go Airport Shuttle & Executive Car
Service, and USA Transportation. Most of our competitors have greater financial
resources and may be able to withstand sales or price decreases better than we
can. We also expect to continue to face competition from new market entrants. We
may be unable to continue to compete effectively with these existing or new
competitors, which could have a material adverse effect on our financial
condition and results of operations.
15
EMPLOYEES; IDENTIFICATION OF CERTAIN SIGNIFICANT EMPLOYEES.
We are a development stage company and currently have no employees.
OFFICES
Our business office is located at 16400 Collins Avenue unit 2142 Sunny Isles
Beach FL 33160. This is the office provided by our secretary Vladislav
Novichenko. Our telephone number is 954-889-7573. We do not pay any rent to Mr.
Novichenko and there is no agreement to pay any rent in the future. As of the
date of this prospectus, we have not sought or selected a new office sight.
GOVERNMENT REGULATION
The Federal Motor Carrier Safety Administration (FMCSA) has safety regulatory
oversight of for-hire operators of small passenger-carrying vehicles that engage
in interstate commerce. Motor carriers are subject to regulatory oversight when
their vehicles are used on a highway in interstate commerce to transport
passengers if the vehicle is designed or used to transport 9 to 15 passengers
(including the driver) for compensation.
We do not believe these federal regulations will impact us since we do not plan
to transport more than 9 passengers at one time. When and if we decide to
operate vehicles with more than 9 passengers we will have to comply with these
regulations.
Our cars have also go through an annual State inspection in order to obtain an
operating permit. Our drivers must obtain a Chauffeur' Registration from the
County License Division which includes passing Driving and Criminal Background
Investigation.
LEGAL PROCEEDINGS
We are not currently a party to any legal proceedings, and we are not aware of
any pending or potential legal actions.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTER AND CONTROL PERSONS
The names, ages and titles of our executive officers and director are as
follows:
Name and Address of Executive
Officers and Director Age Position
--------------------- --- --------
Sergejs Belkovs 39 President, Treasurer and Director
16400 Collins Avenue unit 2142
Sunny Isles Beach FL 33160
Vladislav Novichenko 29 Secretary
16400 Collins Avenue unit 2142
Sunny Isles Beach FL 33160
Sergejs Belkovs has been our President, Treasurer and a member of the Board of
Directors since our inception on June 6, 2011. Mr. Belkovs qualifications to
serve on our Board of Directors are primarily based on his experience as a
manager in the area of transportation services, his knowledge of the dispatch
services and his excellent communication skills. Prior to serving as our
director, Mr Belkovs has devoted significant amount of his time to studying and
researching transportation services industry.
16
From 2006 to April 2011, Mr. Sergejs Belkovs has worked as a manager responsible
for transportation at Baltic Lines, company which owns and operates luxury
vehicles, providing shuttle services in Tallinn, Estonia. His responsibilities
were also to communicate with managers of various hotels and travel agencies. He
has good knowledge of dispatch services, which will be useful in managing
company drivers. Mr. Belkovs plans to spend up to 20 hours a week on the
operations of our company. He has indicated to us that he will be willing to
spend more time with the business as it grows.
Vladislav Novichenko has been our Secretary since our inception on June 6th,
2011. From 2006 to 2009 he has worked as a manager of a car exporting company
"Vladiko" at Miami, Florida. He was responsible for selecting and purchasing
cars from dealers' auction (according to customers' orders) and delivering them
to to shipping destinations. From 2009 to 2010 he was working at "I & V
Services" as driver responsible for elderly transportation. From 2010 till now
Mr.Novichenko is working as insurance agent at "Alltrust insurance group" at
Sunny Isles, Florida.
TERM OF OFFICE
Each of our directors is appointed to hold office until the next annual meeting
of our stockholders or until his respective successor is elected and qualified,
or until he resigns or is removed in accordance with the provisions of the
Nevada Revised Statues. Our officers are appointed by our Board of Directors and
hold office until removed by the Board or until their resignation.
DIRECTOR INDEPENDENCE
Our board of directors is currently composed of one member, Sergejs Belkovs, who
does not qualify as an independent director in accordance with the published
listing requirements of the NASDAQ Global Market. The NASDAQ independence
definition includes a series of objective tests, such as that the director is
not, and has not been for at least three years, one of our employees and that
neither the director, nor any of his family members has engaged in various types
of business dealings with us. In addition, our board of directors has not made a
subjective determination as to each director that no relationships exist which,
in the opinion of our board of directors, would interfere with the exercise of
independent judgment in carrying out the responsibilities of a director, though
such subjective determination is required by the NASDAQ rules. Had our board of
directors made these determinations, our board of directors would have reviewed
and discussed information provided by the directors and us with regard to each
director's business and personal activities and relationships as they may relate
to us and our management.
SIGNIFICANT EMPLOYEES
We have no employees. Our President, Sergejs Belkovs, currently devotes
approximately twenty hours per week to company matters. As our business expands,
Mr. Sergejs Belkovs intends to devote as much time as the Board of Directors
deems necessary to manage the affairs of the company.
EXECUTIVE COMPENSATION
MANAGEMENT COMPENSATION
The following tables set forth certain information about compensation paid,
earned or accrued for services by our President, and Secretary (collectively,
the "Named Executive Officers") from inception on June 6, 2011 until November 30
,2011:
17
SUMMARY COMPENSATION TABLE
Non-Equity Nonqualified
Name and Incentive Deferred
Principal Stock Option Plan Compensation All Other
Position Year Salary($) Bonus($) Awards($) Awards($) Compensation($) Earnings($) Compensation($) Totals($)
-------- ---- --------- -------- --------- --------- --------------- ----------- --------------- ---------
Sergejs June 6, -0- -0- -0- -0- -0- -0- -0- -0-
Belkovs, 2011 to
President, November
Treasurer 30, 2011
and
Secretary
Vladislav June 6, -0- -0- -0- -0- -0- -0- -0- -0-
Novichenko, 2011 to
Secretary November
30, 2011
There are no current employment agreements between the company and its officers.
Sergejs Belkovs currently devotes approximately twenty hours per week to manage
the affairs of the Company. He has agreed to work with no remuneration until
such time as the company revenue will pass break-even point. At this time, we
cannot accurately estimate when break-even point will occur to implement this
compensation, or what the amount of the compensation will be.
Vladislav Novichenko currently devotes approximately twenty hours per week to
manage the affairs of the Company. He has agreed to work with no remuneration
until such time as the company revenue will pass break-even point. At this time,
we cannot accurately estimate when break-even point will occur to implement this
compensation, or what the amount of the compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to the
officer or director or employees in the event of retirement at normal retirement
date pursuant to any presently existing plan provided or contributed to by the
company or any of its subsidiaries, if any.
DIRECTOR COMPENSATION
The following table sets forth director compensation as of November 30, 2011:
Fees Non-Equity Nonqualified
Earned Incentive Deferred
Paid in Stock Option Plan Compensation All Other
Name Cash($) Awards($) Awards($) Compensation($) Earnings($) Compensation($) Total($)
---- ------- --------- --------- --------------- ----------- --------------- --------
Sergejs Belkovs -0- -0- -0- -0- -0- -0- -0-
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Sergejs Belkovs will not be paid for any underwriting services that he performs
on our behalf with respect to this offering.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the number of
shares of our common stock owned beneficially as of November 30, 2011 by: (i)
each person (including any group) known to us to own more than five percent (5%)
of any class of our voting securities, (ii) our director, and or (iii) our
officer. Unless otherwise indicated, the stockholder listed possesses sole
voting and investment power with respect to the shares shown.
18
Title of Name and Address of Amount and Nature of
Class Beneficial Owner Beneficial Ownership Percentage
----- ---------------- -------------------- ----------
Common Stock Sergejs Belkovs 4,500,000 shares of common stock 90%
16400 Collins Avenue (director)
Unit 2142
Sunny Isles Beach FL
33160
Vladislav Novichenko 500,000 shares of common stock 10%
16400 Collins Avenue (executive officer)
Unit 2142
Sunny Isles Beach FL
Director and 5,000,000 shares of common stock 100%
Executive officer as
group (2 person)
On November 30, 2011 there were 5,000,000 shares of our common stock issued and
outranging.
PLAN OF DISTRIBUTION
Global Lines Inc. has 5,000,000 shares of common stock issued and outstanding as
of the date of this prospectus. The Company is registering an additional of
10,000,000 shares of its common stock for sale at the price of $0.01 per share.
There is no arrangement to address the possible effect of the offering on the
price of the stock.
In connection with the Company's selling efforts in the offering, Sergejs
Belkovs will not register as a broker-dealer pursuant to Section 15 of the
Exchange Act, but rather will rely upon the "safe harbor" provisions of SEC Rule
3a4-1, promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). Generally speaking, Rule 3a4-1 provides an exemption from the
broker-dealer registration requirements of the Exchange Act for persons
associated with an issuer that participate in an offering of the issuer's
securities. Mr. Sergejs Belkovs is not subject to any statutory
disqualification, as that term is defined in Section 3(a)(39) of the Exchange
Act. Mr. Sergejs Belkovs will not be compensated in connection with his
participation in the offering by the payment of commissions or other
remuneration based either directly or indirectly on transactions in our
securities. Mr. Sergejs Belkovs not, nor has he been within the past 12 months,
a broker or dealer, and he is not, nor has he been within the past 12 months, an
associated person of a broker or dealer. At the end of the offering, Mr. Belkovs
will continue to primarily perform substantial duties for the Company or on its
behalf otherwise than in connection with transactions in securities. Mr. Sergejs
Belkovs will not participate in selling an offering of securities for any issuer
more than once every 12 months other than in reliance on Exchange Act Rule
3a4-1(a)(4)(i) or (iii).
Global Lines Inc. will receive all proceeds from the sale of the 10,000,000
shares being offered. The price per share is fixed at $0.01 for the duration of
this offering. Although our common stock is not listed on a public exchange or
quoted over-the-counter, we intend to seek to have our shares of common stock
quoted on the Over-the Counter Bulletin Board. In order to be quoted on the OTC
Bulletin Board, a market maker must file an application on our behalf in order
to make a market for our common stock. There can be no assurance that a market
maker will agree to file the necessary documents with FINRA, nor can there be
any assurance that such an application for quotation will be approved. However,
sales by the Company must be made at the fixed price of $0.01.
The Company's shares may be sold to purchasers from time to time directly by and
subject to the discretion of the Company. Further, the Company will not offer
its shares for sale through underwriters, dealers, agents or anyone who may
receive compensation in the form of underwriting discounts, concessions or
commissions from the Company and/or the purchasers of the shares for whom they
may act as agents. The shares of common stock sold by the Company may be
occasionally sold in one or more transactions; all shares sold under this
prospectus will be sold at a fixed price of $0.01 per share.
19
In order to comply with the applicable securities laws of certain states, the
securities will be offered or sold in those only if they have been registered or
qualified for sale; an exemption from such registration or if qualification
requirement is available and with which Global Lines Inc. has complied.
In addition and without limiting the foregoing, the Company will be subject to
applicable provisions, rules and regulations under the Exchange Act with regard
to security transactions during the period of time when this Registration
Statement is effective.
Global Lines Inc. will pay all expenses incidental to the registration of the
shares (including registration pursuant to the securities laws of certain
states).
DESCRIPTION OF SECURITIES
GENERAL
Our authorized capital stock consists of 75,000,000 shares of common stock, par
value $0.001 per share. As of November 30, 2011 there were 5,000,000 shares of
our common stock issued and outstanding that was held by two registered
stockholder of record and no shares of preferred stock issued and outstanding.
COMMON STOCK
The following is a summary of the material rights and restrictions associated
with our common stock. The holders of our common stock currently have (i) equal
ratable rights to dividends from funds legally available therefore, when, as and
if declared by the Board of Directors of the Company; (ii) are entitled to share
ratably in all of the assets of the Company available for distribution to
holders of common stock upon liquidation, dissolution or winding up of the
affairs of the Company; and (iii) are entitled to one non-cumulative vote per
share on all matters on which stock holders may vote. Please refer to the
Company's Articles of Incorporation, Bylaws and the applicable statutes of the
State of Nevada for a more complete description of the rights and liabilities of
holders of the Company's securities.
ANTI-TAKEOVER LAW
Nevada revised statutes sections 78.378 to 78.3793 provide state regulation over
the acquisition of a controlling interest in certain Nevada corporations unless
the articles of incorporation or bylaws of the corporation provide that the
provisions of these sections do not apply. Our articles of incorporation and
bylaws do not state that these provisions do not apply. The statute creates a
number of restrictions on the ability of a person or entity to acquire control
of a Nevada company by setting down certain rules of conduct and voting
restrictions in any acquisition attempt, among other things. The statute is
limited to corporations that are organized in the state of Nevada and that have
200 or more stockholders, at least 100 of whom are stockholders of record and
residents of the state of Nevada; and does business in the state of Nevada
directly or through an affiliated corporation. Because of these conditions, the
statute does not apply to our company.
DIVIDEND POLICY
We have never declared or paid any cash dividends on our common stock. We
currently intend to retain future earnings, if any, to finance the expansion of
our business. As a result, we do not anticipate paying any cash dividends in the
foreseeable future.
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our Articles of Incorporation provide that we will indemnify an officer,
director, or former officer or director, to the full extent permitted by law. We
have been advised that, in the opinion of the SEC, indemnification for
liabilities arising under the Securities Act is against public policy as
expressed in the Securities Act, and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment of expenses incurred or paid by a director, officer or controlling
person in the successful defense of any action, suit or proceeding) is asserted
by one of our director, officers, or controlling persons in connection with the
20
securities being registered, we will, unless in the opinion of our legal counsel
the matter has been settled by controlling precedent, submit the question of
whether such indemnification is against public policy to a court of appropriate
jurisdiction. We will then be governed by the court's decision.
LEGAL MATTERS
No expert or counsel named in this prospectus as having prepared or certified
any part of this prospectus or having given an opinion upon the validity of the
securities being registered or upon other legal matters in connection with the
registration or offering of the common stock was employed on a contingency
basis, or had, or is to receive, in connection with the offering, a substantial
interest, direct or indirect, in our company or any of its parents or
subsidiaries. Nor was any such person connected with our company or any of its
parents or subsidiaries as a promoter, managing or principal underwriter, voting
trustee, director, officer, or employee.
INTERESTS OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this prospectus as having prepared or certified
any part of this Prospectus or having given an opinion upon the validity of the
securities being registered or upon other legal matters in connection with the
registration or offering of the common stock was employed on a contingency
basis, or had, or is to receive, in connection with the offering, a substantial
interest exceeding $50,000, directly or indirectly, in the Company or any of its
parents or subsidiaries. Nor was any such person connected with Global Lines
Inc. or any of its parents or subsidiaries as a promoter, managing or principal
underwriter, voting trustee, director, officer, or employee.
EXPERTS
Carrillo Huettel, LLP, has rendered an opinion with respect to the validity of
the shares of common stock covered by this prospectus.
Sadler, Gibb & Associates, our independent registered public accountant, has
audited our financial statements included in this prospectus and registration
statement to the extent and for the periods set forth in their audit report.
Sadler, Gibb & Associates, has presented its report with respect to our audited
financial statements.
AVAILABLE INFORMATION
We have not previously been required to comply with the reporting requirements
of the Securities Exchange Act. We have filed with the SEC a registration
statement on Form S-1 to register the securities offered by this prospectus. For
future information about us and the securities offered under this prospectus,
you may refer to the registration statement and to the exhibits filed as a part
of the registration statement. In addition, after the effective date of this
prospectus, we will be required to file annual, quarterly and current reports,
or other information with the SEC as provided by the Securities Exchange Act.
You may read and copy any reports, statements or other information we file at
the SEC's public reference facility maintained by the SEC at 100 F Street, N.E.,
Washington, D.C. 20549. You can request copies of these documents, upon payment
of a duplicating fee, by writing to the SEC. Please call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
room. Our SEC filings are also available to the public through the SEC Internet
site at www.sec.gov.
FINANCIAL STATEMENTS
The financial statements of Global Lines Inc. for the period ended November 30,
2011, and related notes, included in this prospectus have been audited by
Sadler, Gibb & Associates, and have been so included in reliance upon the
opinion of such accountants given upon their authority as an expert in auditing
and accounting.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
We have had no changes in or disagreements with our independent registered
public accountant.
21
GLOBAL LINES INC.
(A Development Stage Company)
Balance Sheets
November 30, August 31,
2011 2011
-------- --------
(Unaudited)
ASSETS
Current Assets
Cash and equivalents $ 1,002 $ 4,588
-------- --------
Total current assets 1,002 4,588
-------- --------
Property and Equipment
Property and equipment - net 11,684 --
-------- --------
Total Assets $ 12,686 $ 4,588
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities
Notes payable $ 8,000 $ --
Notes payable - related parties 5,604 604
-------- --------
Total Liabilities 13,604 604
-------- --------
Stockholders' Equity (Deficit)
Common stock; 75,000,000 shares authorized,
at $.001 par value, 5,000,000 and 4,500,000
shares issued and outstanding, respectively 5,000 4,500
Deficit accumulated during the development stage (5,918) (516)
-------- --------
Total Stockholders' Equity (Deficit) (918) 3,984
-------- --------
Total Liabilities and Stockholders' Equity $ 12,686 $ 4,588
======== ========
F-1
GLOBAL LINES INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
For the From Inception
Three Months on June 6, 2011
Ended through
November 30, November 30,
2011 2011
---------- ----------
Revenue $ -- $ --
Operating Expenses
Depreciation expense 316 316
General and administrative 5,086 5,602
---------- ----------
Total Operating Expenses 5,402 5,918
---------- ----------
Net Loss From Operations (5,402) (5,918)
---------- ----------
Net Loss Before Income Taxes (5,402) (5,918)
Provision for income taxes -- --
---------- ----------
Net Loss $ (5,402) $ (5,918)
========== ==========
Net Loss Per Share (Basic and Fully Diluted) $ (0.00)
==========
Weighted Average Number of Common Shares Outstanding 4,956,044
==========
F-2
GLOBAL LINES INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated Total
Common Stock During The Stockholders'
-------------------------- Development Equity
Shares Amount Stage (Deficit)
---------- ---------- ---------- ----------
Balance at June 6, 2011 (Inception) -- $ -- $ -- $ --
Common stock issued for cash 4,500,000 4,500 4,500
Net income (loss) for the period (516) (516)
---------- ---------- ---------- ----------
Balance at August 31, 2011 4,500,000 4,500 (516) 3,984
Common stock issued for cash (unaudited) 500,000 500 500
Net income (loss) for the period (unaudited) (5,402) (5,402)
---------- ---------- ---------- ----------
Balance at November 30, 2011 (unaudited) 5,000,000 $ 5,000 $ (5,918) $ (918)
========== ========== ========== ==========
F-3
GLOBAL LINES INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
For the From Inception
Three Months on June 6, 2011
Ended through
November 30, November 30,
2011 2011
-------- --------
Cash Flows From Operating Activities:
Net income (loss) $ (5,402) $ (5,918)
Adjustments to reconcile net loss to net cash
provided by (used for) operating activities:
Depreciation expense 316 316
Expenses paid on Company's behalf by related parties -- 504
-------- --------
Net Cash Used in Operating Activities (5,086) (5,098)
-------- --------
Cash Flows From Investing Activities:
Purchase of fixed assets (4,000) (4,000)
-------- --------
Net Cash Used in Investing Activities (4,000) (4,000)
-------- --------
Cash Flows From Financing Activities:
Proceeds from director's loans 5,000 5,100
Sale of common stock 500 5,000
-------- --------
Net Cash Provided by Financing Activities 5,500 10,100
-------- --------
Net increase(decrease) in cash and equivalents (3,586) 1,002
Cash and Cash Equivalents at Beginning of Period 4,588 --
-------- --------
Cash and Cash Equivalents at End of Period $ 1,002 $ 1,002
======== ========
Supplemental Cash Flow Information
Cash paid for interest $ -- $ --
======== ========
Cash paid for income taxes $ -- $ --
======== ========
Schedule of Non-Cash Investing And Financing Activities
Note payable issued for purchase of fixed assets $ 8,000 $ 8,000
======== ========
F-4
GLOBAL LINES INC.
(A Development Stage Company)
Notes to the Financial Statements
November 30, 2011 and August 31, 2011
(Unaudited)
NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS
Global Lines, Inc. (the "Company") was incorporated under the laws of the State
of Nevada on June 6, 2011. We are a development stage company that is involved
in a limousine service. Global lines Inc. will be actively engaged in providing
chauffeuring and transportation services to residents within its local Florida
market.
NOTE 2 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements have been prepared by the Company without
audit. In the opinion of management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the financial position,
results of operations, and cash flows at November 30, 2011, and for all periods
presented herein, have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's August 31, 2011
audited financial statements. The results of operations for the period ended
November 30, 2011 are not necessarily indicative of the operating results for
the full year.
NOTE 3 - SUMMARY OF SIGNIFCANT ACCOUNTING POLICIES
Basis of Presentation
The financial statements of the Company have been prepared in accordance with
generally accepted accounting principles in the United States of America and are
presented in US dollars.
Recent Accounting Pronouncements
Global Lines Inc. does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on the Company's results of
operations, financial position or cash flow.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities
of three months or less to be cash equivalents. The Company had $4,588 of cash
as of August 31, 2011 and $1,002 of cash as of November 30, 2011.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
F-5
GLOBAL LINES INC.
(A Development Stage Company)
Notes to the Financial Statements
November 30, 2011 and August 31, 2011
(Unaudited)
NOTE 4 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplate continuation of the
Company as a going concern. However, the Company had no revenues as of November
30, 2011. The Company currently has limited working capital, and has not
completed its efforts to establish a stabilized source of revenues sufficient to
cover operating costs over an extended period of time. Management anticipates
that the Company will be dependent, for the near future, on additional
investment capital to fund operating expenses. The Company intends to position
itself so that it may be able to raise additional funds through the capital
markets. In light of management's efforts, there are no assurances that the
Company will be successful in this or any of its endeavors or become financially
viable and continue as a going concern.
NOTE 5 - PROPERTY AND EQUIPMENT
The company paid a deposit for a vehicle in the amount of $4,000. The remainder
of $8,000 is due by the maturity date of the note at February 29, 2012. The
total purchase price for the vehicle is $12,000. The following is a summary of
property and equipment at November 30, 2011 and August 31, 2011:
November 30, August 31,
2011 2011
-------- --------
Vehicles $ 12,000 $ --
Gross Property and Equipment 12,000 --
Less: accumulated depreciation (316) --
-------- --------
Net Property and Equipment $ 11,684 $ --
======== ========
NOTE 6 - RELATED PARTY TRANSACTIONS
The Company owes $5,604 and $604 to a director of the Company as of November 30,
2011 and August 31, 2011, respectively. The amounts are due on demand, are
non-interest bearing and are unsecured.
NOTE 7 - COMMON STOCK
The Company has 75,000,000 authorized shares of $0.001 par value common stock.
On August 29, 2011, the Company issued 4,500,000 shares of common stock for cash
proceeds of $4,500 at $0.001 per share.
On September 12, 2011, the Company issued 500,000 shares of common stock for
cash proceeds of $500 at $0.001 per share.
NOTE 8 - SUBSEQUENT EVENTS
In accordance with SFAS 165 (ASC 855-10) the Company has analyzed its operations
subsequent to November 30, 2011, the date these financial statements were
issued, and has determined that it does not have any material subsequent events
to disclose in these financial statements.
F-6
Page
----
Audit Report of Independent Accountants F-8
Balance Sheet - August 31, 2011 F-9
Statement of Operations for the period from inception on June 6, 2011
through August 31, 2011 F-10
Statement of Stockholders' Equity for the period from inception on
June 6, 2011 through August 31, 2011 F-11
Statement of Cash Flows for the period from inception on June 6, 2011
through August 31, 2011 F-12
Notes to Financial Statements F-13
F-7
SADLER, GIBB & ASSOCIATES, LLC
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Global Lines, Inc.
(A Development Stage Company)
We have audited the accompanying balance sheet of Global Lines, Inc. as of
August 31, 2011, and the related statement of operations, stockholders' equity
and cash flows for the period from inception on June 6, 2011 through August 31,
2011. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audit 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. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion the financial statements referred to above present fairly, in all
material respects, the financial position of Global Lines, Inc. as of August 31,
2011, and the results of operations and cash flows for the period from inception
on June 6, 2011 through August 31, 2011, in conformity with U.S. generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, the Company had accumulated losses of $516 as of August
31, 2011, which raises substantial doubt about its ability to continue as a
going concern. Management's plans concerning these matters are also described in
Note 2. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ Sadler, Gibb & Associates, LLC
------------------------------------------
Sadler, Gibb & Associates, LLC
Salt Lake City, UT
October 10, 2011
F-8
GLOBAL LINES, INC.
(A Development Stage Company)
Balance Sheet
August 31, 2011
---------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 4,588
--------
Total Current Assets 4,588
--------
TOTAL ASSETS $ 4,588
========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Loan from director $ 604
--------
Total Current Liabilities 604
--------
STOCKHOLDERS' EQUITY
Common stock, par value $0.001; 75,000,000 shares authorized,
4,500,000 shares issued and outstanding 4,500
Deficit accumulated during the development stage (516)
--------
Total Stockholders' Equity 3,984
--------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 4,588
========
The accompanying notes are an integral part of these financial statements.
F-9
GLOBAL LINES, INC.
(A Development Stage Company)
Statement of Operations
From Inception
on June 6, 2011
Through
August 31, 2011
---------------
REVENUES $ --
-----------
OPERATING EXPENSES
General and administrative expenses 516
-----------
Total Operating Expenses 516
-----------
NET LOSS FROM OPERATIONS (516)
Provision for income taxes --
-----------
NET LOSS $ (516)
===========
NET LOSS PER SHARE: BASIC AND DILUTED $ (0.00)
===========
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING: BASIC AND DILUTED 4,500,000
===========
The accompanying notes are an integral part of these financial statements.
F-10
GLOBAL LINES, INC.
(A Development Stage Company)
Statement of Stockholders' Equity
Deficit
Accumulated Total
Common Stock During The Stockholders'
-------------------------- Development Equity
Shares Amount Stage (Deficit)
---------- ---------- ---------- ----------
Balance, June 6, 2011 (Inception) -- $ -- $ -- $ --
Shares issued for cash at
$0.001 per share 4,500,000 4,500 -- 4,500
--------- --------- --------- ---------
Net loss for the year ended
August 31, 2011 -- -- (516) (516)
--------- --------- --------- ---------
Balance, August 31, 2011 4,500,000 $ 4,500 $ (516) $ 3,984
========= ========= ========= =========
The accompanying notes are an integral part of these financial statements.
F-11
GLOBAL LINES, INC.
(A Development Stage Company)
Statement of Cash Flows
From Inception
on June 6, 2011
Through
August 31, 2011
---------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period $ (516)
Adjustments to reconcile net loss to net
cash used in operating activities:
Expenses paid on Company's behalf by related parties 504
--------
Net Cash Used in Operating Activities (12)
--------
CASH FLOWS FROM INVESTING ACTIVITIES --
--------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of common stock 4,500
Proceeds from director's loan 100
--------
Net Cash Provided by Financing Activities 4,600
--------
NET INCREASE IN CASH 4,588
CASH, BEGINNING OF PERIOD --
--------
CASH, END OF PERIOD $ 4,588
========
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ --
========
Income taxes paid $ --
========
NON-CASH FINANCING AND INVESTING ACTIVITIES: $ --
========
The accompanying notes are an integral part of these financial statements.
F-12
GLOBAL LINES, INC.
(A Development Stage Company)
Notes to Financial Statements
August 31, 2011
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
Global Lines, Inc. (the "Company") was incorporated under the laws of the State
of Nevada on June 6, 2011. The Company plans to be actively engaged in providing
chauffeuring and transportation services to residents within its local Florida
market.
Basis of Presentation
The accompanying financial statements have been prepared in accordance with
generally accepted accounting principles related to development stage companies.
A development-stage company is one in which planned principal operations have
not commenced or if its operations have commenced, there has been no significant
revenues there from. The financial statements of the Company have been prepared
in accordance with generally accepted accounting principles in the United States
of America and are presented in US dollars.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles
generally accepted in the United States of America ("GAAP" accounting). The
Company has adopted an August 31 fiscal year end.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with the original maturities
of three months or less to be cash equivalents. The Company had $4,588 of cash
as of August 31, 2011.
Fair Value of Financial Instruments
The Company's financial instruments consist of cash and cash equivalents and
amounts due to shareholder. The carrying amount of these financial instruments
approximates fair value due either to length of maturity or interest rates that
approximate prevailing market rates unless otherwise disclosed in these
financial statements.
Income Taxes
The Company accounts for income taxes in accordance with accounting guidance now
codified as FASB ASC 740, "INCOME TAXES," which requires that the Company
recognize deferred tax liabilities and assets based on the differences between
the financial statement carrying amounts and the tax bases of assets and
liabilities, using enacted tax rates in effect in the years the differences are
expected to reverse. Deferred income tax benefit (expense) results from the
change in net deferred tax assets or deferred tax liabilities. A valuation
allowance is recorded when it is more likely than not that some or all deferred
tax assets will not be realized.
F-13
GLOBAL LINES, INC.
(A Development Stage Company)
Notes to Financial Statements
August 31, 2011
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Income Taxes (Continued)
The Company applies the provisions of ASC 740-10-05, "ACCOUNTING FOR UNCERTAINTY
IN INCOME TAXES". The ASC clarifies the accounting for uncertainty in income
taxes recognized in an enterprise's financial statements. The ASC prescribes a
recognition threshold and measurement attribute for the financial statement
recognition and measurement of a tax position taken or expected to be taken in a
tax return. The ASC provides guidance on de-recognition, classification,
interest and penalties, accounting in interim periods, disclosure and
transition.
The Company did not identify any material uncertain tax positions on returns
that have been filed or that will be filed. The Company did not recognize any
interest or penalties for unrecognized tax benefits during the period ended
August 31, 2011 nor were any interest or penalties accrued as of August 31,
2011.
Basic Income (Loss) Per Share
Basic income (loss) per share is calculated by dividing the Company's net loss
applicable to common shareholders by the weighted average number of common
shares during the period. Diluted earnings per share is calculated by dividing
the Company's net income available to common shareholders by the diluted
weighted average number of shares outstanding during the year. The diluted
weighted average number of shares outstanding is the basic weighted number of
shares adjusted for any potentially dilutive debt or equity. There are no such
common stock equivalents outstanding as of August 31, 2011.
Recent Accounting Pronouncements
Management has considered all recent accounting pronouncements issued since the
last audit of our consolidated financial statements. The Company's management
believes that these recent pronouncements will not have a material effect on the
Company's consolidated financial statements.
Revenue Recognition
The Company recognizes revenue when products are fully delivered or services
have been provided and collection is reasonably assured.
Stock-Based Compensation
Stock-based compensation is accounted for at fair value in accordance with ASC
Topic 718. To date, the Company has not adopted a stock option plan and has not
granted any stock options.
F-14
GLOBAL LINES, INC.
(A Development Stage Company)
Notes to Financial Statements
August 31, 2011
NOTE 2 - GOING CONCERN
The Company's consolidated financial statements are prepared in conformity with
accounting principles generally accepted in the United States of America, which
contemplate continuation of the Company as a going concern. The Company has not
yet established an ongoing source of revenues sufficient to cover its operating
costs and to allow it to continue as a going concern. The Company has incurred
operating losses since inception. During the period ended August 31, 2011, the
Company realized a net loss and incurred an accumulated deficit of $516. The
ability of the Company to continue as a going concern is dependent on the
Company obtaining adequate capital to fund operating losses until it becomes
profitable. If the Company is unable to obtain adequate capital, it could be
forced to cease operations.
In order to continue as a going concern, the Company will need, among other
things, additional capital resources. Management's plan is to obtain such
resources for the Company by obtaining capital from management and significant
shareholders sufficient to meet its minimal operating expenses and seeking
equity and/or debt financing. However, management cannot provide any assurances
that the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plans described in the preceding
paragraph and eventually secure other sources of financing and attain profitable
operations. The accompanying consolidated financial statements do not include
any adjustments that might be necessary if the Company is unable to continue as
a going concern.
NOTE 3 - RELATED PARTY TRANSACTIONS
Various expenses of the Company as well as loans for operating purposes have
been paid for or made by officers of the Company. Loans payable - related
parties total $604 as of August 31, 2011, bear no interest, are unsecured, and
are due upon demand.
Effective June 6, 2011, office space is provided by the Company's sole officer
and director. No rent is charged for the use of the space.
NOTE 4 - STOCKHOLDERS' EQUITY
Authorized Shares
The Company has 75,000,000, $0.001 par value shares of common stock authorized.
Issuances of Common Stock
On August 29, 2011, the Company issued 4,500,000 shares of common stock for cash
proceeds of $4,500 at $0.001 per share.
F-15
GLOBAL LINES, INC.
(A Development Stage Company)
Notes to Financial Statements
August 31, 2011
NOTE 5 - INCOME TAXES
The Company's provision for income taxes was $-0- for the period ended August
31, 2011 since the Company incurred taxable losses and deferred tax assets
recognized are offset by a full valuation allowance in each fiscal year.
ASC 740 requires the reduction of deferred tax assets by a valuation allowance
if, based on the weight of available evidence, it is more likely than not that
some or all of the deferred tax assets will not be realized. In the Company's
opinion, it is uncertain whether they will generate sufficient taxable income in
the future to fully utilize the net deferred tax asset. Accordingly, a full
valuation allowance equal to the deferred tax asset has been recorded. The total
deferred tax asset is calculated by multiplying a 39% marginal tax rate by the
cumulative Net Operating Loss ("NOL").
At August 31, 2011, the Company has available $516 of NOL's which expire in
various years beginning in 2027 and carrying forward through 2031.
The tax effects of significant items comprising the Company's net deferred taxes
as of August 31, 2011 were as follows:
August 31, 2011
---------------
Cumulative NOL $ 516
========
Deferred Tax assets:
Net operating loss carry forwards 175
Valuation allowance (175)
--------
$ --
========
The provision for income taxes differs from the amounts which would be provided
by applying the statutory federal income tax rate of 34% to net loss before
provision for income taxes for the following reasons:
August 31, 2011
---------------
Income tax benefit at U. S. federal statutory rates: $ (175)
Change in valuation allowance 175
--------
$ --
========
The Company files federal and Nevada income tax returns subject to statutes of
limitations. The period ended August 31, 2011 is subject to examination by
federal and state tax authorities.
NOTE 6 - SUBSEQUENT EVENTS
On September 9, 2011, the Company issued 500,000 shares of common stock for cash
proceeds of $500 at $0.001 per share.
In accordance with SFAS 165 (ASC 855-10) the Company has analyzed its operations
subsequent to August 31, 2011, the date these financial statements were issued,
and has determined that it does not have any material subsequent events to
disclose in these financial statements.
F-16
[Back Page of Prospectus]
PROSPECTUS
10,000,000 SHARES OF COMMON STOCK
GLOBAL LINES INC.
DEALER PROSPECTUS DELIVERY OBLIGATION
UNTIL _____________ ___, 2011, ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE
SECURITIES WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO
DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALERS' OBLIGATION TO DELIVER
A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated costs (assuming all shares are sold) of this offering are as
follows:
SEC Registration Fee $ 3.35
Printing Expenses $ 96.65
Accounting Fees and Expenses $ 600.00
Auditor Fees and Expenses $3,000.00
Legal Fees and Expenses $3,000.00
Transfer Agent Fees $1,300.00
---------
TOTAL $8,000.00
=========
----------
(1) All amounts are estimates, other than the SEC's registration fee.
ITEM 14. INDEMNIFICATION OF DIRECTOR AND OFFICERS
Global Lines Inc.'s bylaws allow for the indemnification of the officer and/or
director in regards each such person carrying out the duties of his or her
office. The Board of Directors will make determination regarding the
indemnification of the director, officer or employee as is proper under the
circumstances if he has met the applicable standard of conduct set forth under
the Nevada Revised Statutes.
As to indemnification for liabilities arising under the Securities Act of 1933,
as amended, for a director, officer and/or person controlling Global Lines
Inc., we have been informed that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy and unenforceable.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is information regarding the issuance and sales of securities
without registration since inception.
On August 29, 2011, Global Lines Inc. sold 4,500,000 share of common stock to
our president, Sergejs Belkovs, for a purchase price of $0.001 per share, for
aggregate offering proceeds of $4,500. On September 12, 2011, Global Lines Inc.
sold 500,000 share of common stock to our secretary, Vladislav Novichenko, for a
purchase price of $0.001 per share, for aggregate offering proceeds of $500.
Global Lines Inc. made the offer and sale in reliance on the exemption from
registration afforded by Section 4(2) to the Securities Act of 1933, as amended
(the "Securities Act"), on the basis that the securities were offered and sold
in a non-public offering to a "sophisticated investor" who had access to
registration-type information about the Company. No commission was paid in
connection with the sale of any securities an no general solicitations were made
to any person.
II-1
ITEM 16. EXHIBITS
Exhibit
Number Description of Exhibit
------ ----------------------
3.1 Articles of Incorporation of the Registrant *
3.2 Bylaws of the Registrant *
5.1 Opinion re: Legality and Consent of Counsel *
10.1 Agreement dated June 28, 2011, by and between the Global Lines Inc.
and Super Limousines *
23.1 Consent of Legal Counsel (contained in exhibit 5.1) *
23.2 Consent of Sadler, Gibb & Associates
----------
* Previously Filed
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to:
(a) Include any prospectus required by Section 10(a)(3) of the Securities
Act;
(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)
(ss.230.424(b) of this chapter) if, in the aggregate, the changes in
volume and price represent no more than 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(c) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
2. That, for the purpose of determining any liability under the Securities Act
of 1933, 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 hereby that remains unsold at the
termination of the offering.
4. For determining liability of the undersigned Registrant under the
Securities Act to any purchaser in the initial distribution of the
securities, that in a primary offering of securities of the undersigned
Registrant pursuant to this registration statement, regardless of the
underwriting method used to sell the securities to the purchaser, if the
II-2
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned Registrant will be a seller to
the purchaser and will be considered to offer or sell such securities to
such purchaser:
(a) Any preliminary prospectus or prospectus of the undersigned Registrant
relating to the offering required to be filed pursuant to Rule 424;
(b) Any free writing prospectus relating to the offering prepared by or on
behalf of the undersigned Registrant or used or referred to by the
undersigned Registrant;
(c) The portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
Registrant or its securities provided by or on behalf of the
undersigned Registrant; and
(d) Any other communication that is an offer in the offering made by the
undersigned Registrant to the purchaser.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to our director, officers and controlling
persons pursuant to the provisions above, or otherwise, we have been advised
that in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities, other
than the payment by us of expenses incurred or paid by one of our director,
officers, or controlling persons in the successful defense of any action, suit
or proceeding, is asserted by one of our director, officers, or controlling
person sin connection with the securities being registered, we 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 is against public policy as expressed in the Securities Act, and
we will be governed by the final adjudication of such issue.
For the purposes of determining liability under the Securities Act for any
purchaser, each prospectus filed pursuant to Rule 424(b) as part of a
registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on
Rule 430A, shall be deemed to be part of and included in the registration
statement as of the date it is first used after effectiveness. Provided,
however, that no statement made in a registration statement or prospectus that
is part of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or prospectus
that is part of the registration statement will, as to a purchaser with a time
of contract of sale prior to such first use, supersede or modify any statement
that was made in the registration statement or prospectus that was part of the
registration statement or made in any such document immediately prior to such
date of first use.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Sunny Isles Beach, State
of Florida, on December 28, 2011.
GLOBAL LINES INC.
By: /s/ Sergejs Belkovs
-----------------------------------------
Name: Sergejs Belkovs
Title: President
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
By: /s/ Sergejs Belkovs
-----------------------------------------
Sergejs Belkovs
Principal Executive Officer, Controller
Principal Financial Officer, Director
Dated: December 28, 2011
II-4
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
------ ----------------------
3.1 Articles of Incorporation of the Registrant *
3.2 Bylaws of the Registrant *
5.1 Opinion re: Legality and Consent of Counsel *
10.1 Agreement dated June 28, 2011, by and between the Global Lines Inc.
and Super Limousines *
23.1 Consent of Legal Counsel (contained in exhibit 5.1) *
23.2 Consent of Sadler, Gibb & Associates
----------
* Previously Filed