UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
July 30, 2004
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GLOBETEL COMMUNICATIONS CORP.
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(Exact name of registrant as specified in its charter)
Delaware 0-23532 88-0292161
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification Number)
9050 Pines Blvd., Suite 110
Pembroke Pines, FL 33024
(Address of principal executive offices) (Zip Code)
(954) 241-0590
(Registrant's telephone number including area code)
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
On July 30, 2004, Globetel Communications Corp. (GlobeTel) filed with the
Delaware Secretary of State, three Certificates of Designation, designating
three new series of Preferred Shares, Series B, C and D.
Series B Preferred Shares have been authorized in the amount of 35,000 shares.
The shares have the following rights and attributes:
1. Liquidation value: $10.00 per share
2. Conversion Rights: Beginning on the first anniversary of the First Closing
Date and for a period of two years thereafter, the Purchaser may convert
(in whole or part) its Series B Preferred Stock into GLOBETEL common stock.
The Series B Preferred Stock shall be convertible in at least 1,000 share
increments. Each increment, at the time of conversion, will represent 1% of
the issued and outstanding shares of GlobeTel common stock. On the third
anniversary of the First Closing Date, all shares of Series B Preferred
Stock owned by the Purchaser will automatically be converted into GlobeTel
common stock (to the extent such shares have not been converted into common
stock prior to this date).
3. Voting Rights: Provided that at least 85 % of the Series B Preferred Stock
remains outstanding, the Holders of the Series B Preferred Stock, voting as
a group, will have voting rights equal to 50% plus one share of GlobeTel's
authorized shares of common stock for a period of three years from the date
of the first issuance of Series B shares.
Series C Preferred Shares have been authorized in the amount of 5,000 shares.
The shares have the following rights and attributes:
1. Liquidation value: $10.00 per share
2. Conversion Rights: Convertible after one year from date of issuance into
shares of Globetel Common Shares on the basis of 1,000 Series C shares
shall equal 2% of the Common shares issued and outstanding at the time of
conversion. All shares must be converted by the third anniversary of the
date of first issuance of the shares or the shares shall automatically
convert.
3. Voting Rights: The shares shall have voting rights equal to the number of
common shares into which the preference shares may be converted at the time
of any vote.
Series D Preferred Shares have been authorized in the amount of 5,000 shares.
The shares have the following rights and attributes:
1. Liquidation Value: $10.00 per share
2. Conversion Rights: : Convertible after two years from date of issuance into
shares of Globetel Common Shares on the basis of 1,000 Series C shares
shall equal 2% of the Common shares issued and outstanding at the time of
conversion. All shares must be converted by the third anniversary of the
date of first issuance of the shares or the shares shall automatically
convert.
3. Voting Rights: The shares shall have voting rights equal to the number of
common shares into which the preference shares may be converted at the time
of any vote.
ITEM 7. EXHIBITS
Item No. Description
4.1 Certificate of Designation for Series B Preferred Shares
4.2 Certificate of Designation for Series C Preferred Shares
4.3 Certificate of Designation for Series D Preferred Shares
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
GLOBETEL COMMUNICATIONS CORP.
August 3, 2004 By: /s/ Timothy Huff
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Timothy Huff
Chief Executive Officer