UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C.   20549




FORM
10-Q


(Mark
One)





[
      X ]
            QUARTERLY
      REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
quarterly period ended September
30,
2009





[    ]
            TRANSITION
      REPORT UNDER SECTION 13 0R 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
transition period from 
to





Commission
file number 000-33309





GLOBETRAC
      INC.(Exact
      name of registrant as specified in its
charter)





Delaware
                              (State
      or other jurisdiction of incorporation or organization)
                            33-0953557
                              (I.R.S.
      Employer Identification No.)1100 Melville Street, Suite #610, Vancouver,
      British Columbia, Canada
                              (Address
      of principal executive offices)
                            V6E 4A6
                              (Zip
      Code)1-800-648-4287
                              (Registrant’s
      telephone number, including area code)n/a
                              (Former name, former address and former fiscal
      year, if changed since last
report)





Indicate
by check mark whether the registrant (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.


[
T
]
Yes         [    ]  No




Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (s. 232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).


[    ]
Yes         [    ]  No




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.




Larger
      accelerated filer
                        [     ]
                        
                        Accelerated
      filer
                        [     ]Non-accelerated
      filer
                        [     ] (Do
      not check if a smaller reporting company)
                        
                        Smaller
      reporting company
                        [
      T
      ]


Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


[    ]
Yes         [ X
]  No




APPLICABLE
ONLY TO CORPORATE ISSUERS




State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of the latest practicable date.





Class
              Outstanding
      at November 13,2009common
      stock - $0.001 par value
              89,883,198




1




PART
I – FINANCIAL INFORMATION





Item
1.  Financial Statements.




GLOBETRAC
      INC.BALANCE
      SHEETSSeptember
      30,
                                  2009
                                
                                
                                December
      31,
                                  2008UnauditedASSETSCurrent
      assetsCash
                                
                                $
                                14,872
                                
                                
                                $
                                26,538Accounts
      receivable
                                
                                
                                9,694
                                
                                
                                
                                43,829Prepaids
                                
                                
                                8,890
                                
                                
                                
                                999Total
      current assets
                                
                                $
                                33,456
                                
                                
                                $
                                71,366LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      liabilitiesAccounts
      payable
                                
                                $
                                55,456
                                
                                
                                $
                                43,074Accrued
      liabilities
                                
                                
                                6,288
                                
                                
                                
                                5,287Accrued
      professional fees
                                
                                
                                45,482
                                
                                
                                
                                51,257Due
      to related parties
                                
                                
                                33,640
                                
                                
                                
                                33,106Total
      current liabilities
                                
                                
                                140,866
                                
                                
                                
                                132,724Commitments
      and contingencies
                                
                                
                                -
                                
                                
                                
                                -Stockholders'
      deficitPreferred
      stock $0.001 par value, 5,000,000 authorized, none issued
    andoutstanding
      at September 30, 2009 and December 31, 2008
                                
                                
                                -
                                
                                
                                
                                -Common
      stock $0.001 par value, 200,000,000 common shares
    authorized,89,883,198
      issued and outstanding at September 30, 2009 and December 31,
      2008
                                
                                
                                89,883
                                
                                
                                
                                89,883Additional
      paid in capital
                                
                                
                                1,167,085
                                
                                
                                
                                1,167,085Accumulated
      deficit
                                
                                
                                (1,377,790
                                )
                                
                                
                                (1,335,134
                                )Accumulated
      other comprehensive income
                                
                                
                                13,412
                                
                                
                                
                                16,808Total
      stockholders' deficit
                                
                                
                                (107,410
                                )
                                
                                
                                (61,358
                                )Total
      liabilities and stockholders' deficit
                                
                                $
                                33,456
                                
                                
                                $
                                71,366The
      accompanying notes are an integral part of these financial
      statements




2




GLOBETRAC
      INC.STATEMENTS
      OF OPERATIONSFOR
      THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2009 AND
  2008(UNAUDITED)Three
      months ended
                                          September
      30,
                                        
                                        
                                        Nine
      months ended
                                          September
      30,2009
                                        
                                        
                                        2008
                                        
                                        
                                        2009
                                        
                                        
                                        2008Royalty
      income
                                        
                                        $
                                        16,818
                                        
                                        
                                        $
                                        51,781
                                        
                                        
                                        $
                                        50,388
                                        
                                        
                                        $
                                        124,685Operating
      expenses:General
      and administrative
                                        
                                        
                                        29,235
                                        
                                        
                                        
                                        39,949
                                        
                                        
                                        
                                        93,044
                                        
                                        
                                        
                                        85,608Net
      (loss) income from operations
                                        
                                        
                                        (12,417
                                        )
                                        
                                        
                                        11,832
                                        
                                        
                                        
                                        (42,656
                                        )
                                        
                                        
                                        39,077Interest
      Expense
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        (46,618
                                        )Net
      (loss) income from operations before forgiveness of debt
                                        
                                        
                                        (12,417
                                        )
                                        
                                        
                                        11,832
                                        
                                        
                                        
                                        (42,656
                                        )
                                        
                                        
                                        (7,541
                                        )Forgiveness
      of debt
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        -
                                        
                                        
                                        
                                        3,196,063Net
      (loss) income from operations
                                        
                                        $
                                        (12,417
                                        )
                                        
                                        $
                                        11,832
                                        
                                        
                                        $
                                        (42,656
                                        )
                                        
                                        $
                                        3,188,522Net
      (loss) earnings per share - basic and diluted
                                        
                                        $
                                        (0.00
                                        )
                                        
                                        $
                                        0.00
                                        
                                        
                                        $
                                        (0.00
                                        )
                                        
                                        $
                                        0.07Weighted
      average number of shares outstanding - basic and diluted
                                        
                                        
                                        89,883,198
                                        
                                        
                                        
                                        89,883,198
                                        
                                        
                                        
                                        89,883,198
                                        
                                        
                                        
                                        45,166,158The
      accompanying notes are an integral part of these financial
      statements




3




GLOBETRAC
      INC.STATEMENT
      OF STOCKHOLDERS' DEFICIT AND COMPREHENSIVE INCOMEFOR
      THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008(UNAUDITED)AccumulatedCommon
      Stock Issued
                              
                              
                              Additional
                              
                              
                              
                              
                              
                              OtherNumber
      of
                              
                              
                              
                              
                              
                              Paid-in
                              
                              
                              Accumulated
                              
                              
                              ComprehensiveShares
                              
                              
                              Amount
                              
                              
                              Capital
                              
                              
                              Deficit
                              
                              
                              Income
      (Loss)
                              
                              
                              TotalBalance
      at January 1, 2008
                              
                              
                              22,190,000
                              
                              
                              $
                              22,190
                              
                              
                              $
                              1,167,085
                              
                              
                              $
                              (4,511,922
                              )
                              
                              $
                              13,108
                              
                              
                              $
                              (3,309,539
                              )Shares
      issued for debt
                              
                              
                              67,693,198
                              
                              
                              
                              67,693
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              67,693Net
      income for the nine months ended September 30, 2008
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              3,188,522
                              
                              
                              
                              -
                              
                              
                              
                              3,188,522Foreign
      currency exchange gain
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              3,793
                              
                              
                              
                              3,793Net
      comprehensive income
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              3,192,315Balance
      at September 30, 2008
                              
                              
                              89,883,198
                              
                              
                              
                              89,883
                              
                              
                              
                              1,167,085
                              
                              
                              
                              (1,323,400
                              )
                              
                              
                              16,901
                              
                              
                              
                              (49,531
                              )Net
      loss for the three months ended December 31, 2008
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (11,734
                              )
                              
                              
                              -
                              
                              
                              
                              (11,734
                              )Foreign
      currency exchange gain
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (93
                              )
                              
                              
                              (93
                              )Net
      comprehensive loss
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (11,827
                              )Balance
      at December 31, 2008
                              
                              
                              89,883,198
                              
                              
                              
                              89,883
                              
                              
                              
                              1,167,085
                              
                              
                              
                              (1,335,134
                              )
                              
                              
                              16,808
                              
                              
                              
                              (61,358
                              )Net
      loss for the nine months ended September 30, 2009
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (42,656
                              )
                              
                              
                              -
                              
                              
                              
                              (42,656
                              )Foreign
      currency exchange gain
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (3,396
                              )
                              
                              
                              (3,396
                              )Net
      comprehensive loss
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              -
                              
                              
                              
                              (46,052
                              )Balance
      at September 30, 2009
                              
                              
                              89,883,198
                              
                              
                              $
                              89,883
                              
                              
                              $
                              1,167,085
                              
                              
                              $
                              (1,377,790
                              )
                              
                              $
                              13,412
                              
                              
                              $
                              (107,410
                              )The
      accompanying notes are an integral part of these financial
      statements




4


GLOBETRAC
      INC.STATEMENTS
      OF CASH FLOWSFOR
      THE NINE MONTHS ENDED SEPTEMBER 30, 2009 AND 2008(UNAUDITED)2009
                                                    
                                                    
                                                    2008Cash
      flows from operating activities:Net
      (loss) income
                                                    
                                                    $
                                                    (42,656
                                                    )
                                                    
                                                    $
                                                    3,188,522Adjustments
      to reconcile net income (loss) to net cash provided by (used in) operating
      activities:Forgiveness
      of debt
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (1,624,638
                                                    )Forgiveness
      of convertible notes payable
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (586,660
                                                    )Forgiveness
      of accrued interest on convertible notes payable
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (540,014
                                                    )Forgiveness
      of advances payable
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (15,974
                                                    )Forgiveness
      of debt due to related parties
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (161,550
                                                    )Forgiveness
      of interest on note payable to related party
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    (267,227
                                                    )Changes
      in operating assets and liabilities:Accounts
      receivable
                                                    
                                                    
                                                    34,135
                                                    
                                                    
                                                    
                                                    18,404Prepaids
                                                    
                                                    
                                                    (7,891
                                                    )
                                                    
                                                    
                                                    4,035Accounts
      payable
                                                    
                                                    
                                                    12,382
                                                    
                                                    
                                                    
                                                    (4,682
                                                    )Accrued
      liabilities
                                                    
                                                    
                                                    1,001
                                                    
                                                    
                                                    
                                                    (15,957
                                                    )Accrued
      professional fees
                                                    
                                                    
                                                    (5,775
                                                    )
                                                    
                                                    
                                                    -Accrued
      interest on convertible notes payable
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    34,187Advances
      payable
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    14Due
      to related parties
                                                    
                                                    
                                                    534
                                                    
                                                    
                                                    
                                                    -Accrued
      interest on note payable to related party
                                                    
                                                    
                                                    -
                                                    
                                                    
                                                    
                                                    12,431Net
      cash (used in) provided by operating activities
                                                    
                                                    
                                                    (8,270
                                                    )
                                                    
                                                    
                                                    40,891Effect
      of foreign currency exchange
                                                    
                                                    
                                                    (3,396
                                                    )
                                                    
                                                    
                                                    3,793Net
      (decrease) increase in cash
                                                    
                                                    
                                                    (11,666
                                                    )
                                                    
                                                    
                                                    44,684Cash,
      beginning of period
                                                    
                                                    
                                                    26,538
                                                    
                                                    
                                                    
                                                    16,922Cash,
      end of period
                                                    
                                                    $
                                                    14,872
                                                    
                                                    
                                                    $
                                                    61,606Supplemental
      disclosure of cash flow information:Cash
      paid during the period for:Income
      taxes
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    -Interest
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    -Non-cash
      changes in assets and liabilities:Conversion
      of convertible notes payable into common shares
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    (36,924
                                                    )Conversion
      of advances payable into common shares
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    (655
                                                    )Conversion
      of debt due to related parties to common shares
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    (10,114
                                                    )Conversion
      of note payable to related party to common shares
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    (20,000
                                                    )Issuance
      of common shares for debt
                                                    
                                                    $
                                                    -
                                                    
                                                    
                                                    $
                                                    67,693The
      accompanying notes are an integral part of these financial
      statements




5


GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009
 (UNAUDITED)
   NOTE
1 – ORGANIZATION AND NATURE OF OPERATIONS
  Nature
of Operations
 
 GlobeTrac
Inc. (GlobeTrac or the Company) was incorporated in the state of Delaware on
March 2, 2000 as 411 Place.com Inc.  On February 28, 2001, the Company
changed its name to Artescope, Inc. and on July 29, 2002 changed its name to
GlobeTrac Inc.  The Company’s principal executive offices are
headquartered in Canada.  On August 27, 2002 the Company acquired 100%
of the shares of Global Axxess Corporation Limited (Global Axxess), a company
incorporated in Ireland.  On June 12, 2008 the Company sold its shares
of Global Axxess, its only subsidiary.  Global Axxess owned 100% of
the issued and outstanding shares of Globetrac Limited (Limited), a company
incorporated in the United Kingdom, until March 20, 2007 when Limited was
officially dissolved and all of Limited’s assets and liabilities were assumed by
GlobeTrac. As a result of terminating its operations in Europe, the Company is
seeking new business opportunities.
 
 The
Company was in the business of selling, marketing, distributing and installing
global wireless tracking and telematics equipment in Europe until November 1,
2004 when they exchanged certain of their assets and certain liabilities in
Globetrac Limited and their rights to the global wireless tracking and
telematics business in Europe for a six percent royalty on gross sales of all
existing and qualified potential customers that the Company has in
Europe.
 
 In these
notes, the terms “Company”, “we”, “us” or “our” mean GlobeTrac Inc. whose
operations are included in these unaudited financial statements.
 
 Basis
of Presentation
 
 The
unaudited financial statements included herein have been prepared in accordance
with accounting principles generally accepted in the United States for interim
financial information and with the instructions to Form 10-Q and Article 8 of
Regulation S-X.  They do not include all information and notes
required by generally accepted accounting principles for complete financial
statements.  However, except as disclosed herein, there has been no
material change in the information disclosed in the notes to the financial
statements included in the Annual Report on Form 10-K of GlobeTrac Inc. for the
year ended December 31, 2008. In the opinion of management, all adjustments
(including normal recurring accruals) considered necessary for a fair
presentation have been included.  Operating results for the three and
nine months ended September 30, 2009 are not necessarily indicative of the
results that may be expected for any other interim period or the entire
year.  For further information, these unaudited financial statements
and the related notes should be read in conjunction with the Company’s audited
financial statements for the year ended December 31, 2008 included in the
Company’s report on Form 10-K.
  NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
 A summary
of the Company’s significant accounting policies are included in the Company’s
Form 10-K dated and filed on April 1, 2009 for the fiscal year ended December
31, 2008. Significant accounting pronouncements that affect the Company or
have been adopted or developed since December 31, 2008 are summarized
below.
 
 Recent
Accounting Pronouncements
 
 In
December 2007, the FASB issued SFAS No. 141(R), Business Combinations,(ASC
805, Business
Combinations) “ASC 805”,, which replaces SFAS 141, Business
Combinations.  ASC 805 requires an acquirer to recognize the
assets acquired, the liabilities assumed, and any non-controlling interest in
the acquiree at the acquisition date, measured at their fair values as of that
date, with limited exceptions. This Statement also requires the acquirer in a
business combination achieved in stages to recognize the identifiable assets and
liabilities, as well as the non-controlling interest in the acquiree, at the
full amounts of their fair values.ASC 805 makes various other amendments to
authoritative literature intended to provide additional guidance or to confirm
the guidance in that literature to that provided in this Statement. This
Statement applies prospectively to business combinations for which the
acquisition date is on or after the beginning of the first annual reporting
period beginning on or after December 15, 2008.  This statement
was effective for us on January 1, 2009.  We expect ASC 805 will have
an impact on our accounting for future business combinations, but the effect is
dependent upon the acquisitions that are made in the future.
  6
 GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009
 (UNAUDITED)
 NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Recent
Accounting Pronouncements (Continued)
  In
December 2007, the EITF of the FASB reached a consensus on Issue
No. 07-1, Accounting for
Collaborative Arrangements ,(ASC 808, Collaborative Arrangements)
“ASC 808”. The EITF concluded on the definition of a collaborative arrangement
and that revenues and costs incurred with third parties in connection with
collaborative arrangements would be presented gross or net based on the criteria
in EITF 99-19 and other accounting literature. Based on the nature of the
arrangement, payments to or from collaborators would be evaluated and its terms,
the nature of the entity’s business, and whether those payments are within the
scope of other accounting literature would be presented. Companies are also
required to disclose the nature and purpose of collaborative arrangements along
with the accounting policies and the classification and amounts of significant
financial-statement amounts related to the arrangements. Activities in the
arrangement conducted in a separate legal entity should be accounted for under
other accounting literature; however required disclosure under ASC 808 applies
to the entire collaborative agreement. This Issue is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years, and is to be applied retrospectively
to all periods presented for all collaborative arrangements existing as of the
effective date. ASC 808 was effective for us on January 1,
2009.  Adoption of ASC 808 did not have a significant impact on our
financial statements.
 
 Effective
January 1, 2009, Globetrac, Inc. adopted Financial Accounting Standards Board's
Statement No. 160, Noncontrolling Interests in
Consolidated Financial Statements – an Amendment of ARB No. 51(ASC 810,
Consolidation) “ASC
810”. ASC 810 changed the accounting and reporting for minority interests, which
will be recharacterized as noncontrolling interests and classified as a
component of equity.  ASC 810 required retrospective adoption of the
presentation and disclosure requirements for existing minority interests. 
All other requirements of ASC 810 will be applied prospectively.  The
adoption of ASC 810 did not have a material impact on the Company's financial
statements.
 
 In
March 2008, the FASB issued SFAS No. 161 (SFAS 161), Disclosures about Derivative
Instruments and Hedging Activities – An Amendment of FASB Statement No. 133(ASC 815 Derivatives
and Hedging) “ASC 815”. This statement
is intended to improve financial reporting of derivative instruments and hedging
activities by requiring enhanced disclosures about (a) how and why an entity
uses derivative instruments, (b) how derivative instruments and related hedged
items are accounted for under SFAS 133 and its related interpretations and (c)
how derivative instruments and related hedged items affect an entity’s financial
position, financial performance and cash flows. The provisions of ASC 815 are
effective for fiscal years beginning after
November 15, 2008.  This statement was effective for us on
January 1, 2009.  Early adoption of this provision was prohibited. The
adoption of this statement did not have a material impact on our financial
statements.
 
 In April
2008, the FASB issued FSP No. 142-3, Determination of the Useful Life of
Intangible Assets(ASC 30-50General Intangibles Other than
Goodwill) “ASC 30-50”. ASC 30-50 amends the factors to be considered in
developing renewal or extension assumptions used to determine the useful life of
intangible assets under SFAS No. 142, Goodwill and Other Intangible
Assets. Its intent is to improve the consistency between the useful life
of an intangible asset and the period of expected cash flows used to measure its
fair value. This ASC is effective prospectively for intangible assets acquired
or renewed after January 1, 2009. The adoption of ASC 30-50 did not have a
material impact on our financial statements. .
  On May 9,
2008, the FASB issued FASB Staff Position No. APB 14-1(ASC 470-20Debt with Conversion and Other
Options) “ASC 470-20”, Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement).ASC 470-20 clarifies that convertible debt instruments that
may be settled in cash upon conversion (including partial cash settlement) are
not addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and
Debt Issued with Stock Purchase Warrants.  Additionally, ASC
470-20 specifies that issuers of such instruments should separately account for
the liability and equity components in a manner that will reflect the entity’s
nonconvertible debt borrowing rate when interest cost is recognized in
subsequent periods. ASC 470-201 is effective for financial statements issued for
fiscal years beginning after December 15, 2008, and interim periods within those
fiscal years. ASC 470-20 was effective for the Company on January 1,
2009.  The adoption of ASC 470-20 did not have a material impact on
our results of operations or financial position or our earnings per share share
calculations.
  7
  GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009
 (UNAUDITED)
 NOTE
2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
 
 Recent
Accounting Pronouncements (Continued)
 On June
16, 2008, the FASB issued FASB Staff Position No. EITF 03-6-1, Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities(ASC 260Earnings per
Share) “ASC 260”, to address the question of
whether instruments granted in share-based payment transactions are
participating securities prior to vesting. ASC 260 indicates that unvested
share-based payment awards that contain rights to dividend payments should be
included in earnings per share calculations. The guidance will be effective for
fiscal years beginning after December 15, 2008. ASC 260 was effective for the
Company on January 1, 2009.  The adoption of ASC 260 did not have a
material impact on our results of operations or financial position.
 
 In June
2008, the FASB issued EITF Issue 07-5, Determining whether an Instrument
(or Embedded Feature) is indexed to an Entity’s Own Stock(ASC
815-40Contracts in Entity’s
own Equity) “ASC 815-40”.  ASC 815-40 is effective for
financial statements issued for fiscal years beginning after December 15, 2008,
and interim periods within those fiscal years. Early application is not
permitted. Paragraph 11(a) of SFAS No. 133 Accounting for Derivatives and
Hedging Activities, specifies that a contract that would otherwise meet
the definition of a derivative but is both (a) indexed to the Company’s own
stock and (b) classified in stockholders’ equity in the statement of financial
position would not be considered a derivative financial instrument. ASC 815-40
provides a new two-step model to be applied in determining whether a financial
instrument or an embedded feature is indexed to an issuer’s own stock and thus
able to qualify for the SFAS No. 133 paragraph 11(a) scope
exception.  ASC 815-40 was effective for us on January 1,
2009.  Adoption of ASC 815-40 did not have a material impact on our
financial statements.
 
 In June
2009, the FASB issued Statement No. 168, Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting Principles—a replacement of
FASB Statement No. 162 (ASC 105,Generally Accepted Accounting
Principles) “ASC 105”. ASC 105 will become the single source of
authoritative nongovernmental U.S. generally accepted accounting principles
("GAAP"), superseding existing FASB, American Institute of Certified Public
Accountants ("AICPA"), Emerging Issues Task Force ("EITF"), and related
accounting literature. ASC 105 reorganizes the thousands of GAAP pronouncements
into roughly 90 accounting topics and displays them using a consistent
structure. Also included is relevant Securities and Exchange Commission guidance
organized using the same topical structure in separate sections. ASC 105 will be
effective for financial statements issued for reporting periods that end after
September 15, 2009, which means July 1, 2009 for GlobeTrac, Inc. The adoption of
the Codification did not have an impact on our financial position or results of
operations.
  NOTE
3 – GOING CONCERN
 
 The
Company was in the business of selling, marketing, distributing and installing
global wireless tracking and telematics equipment in Europe until November 1,
2004 when they exchanged their rights to sell, market, distribute and install
global wireless tracking and telematics equipment in Europe as well as specific
assets and liabilities, for a royalty of 6% on future gross sales to current
customers and qualified potential customers in Europe. There is no cap on the
royalties and royalties are to be paid for the duration of 11 years, ending
October 31, 2015.  The Company has accumulated a deficit of $1,377,790
since inception and additional financing will be required by the Company to fund
and support its operations.  Management plans to mitigate its losses
in future years by controlling its operating expenses and seeking out new
business opportunities.   However, there is no assurance that the
Company will be able to obtain additional financing, control their operating
expenses or be successful in locating or acquiring a viable
business.  The financial statements do not include any adjustments
that might result from the outcome of those uncertainties.
  8
  GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009
 (UNAUDITED)
 NOTE
4 – CONVERTIBLE NOTES PAYABLE AND RELATED ACCRUED INTEREST DUE ON
DEMAND
 
 On June
23, 2008, the holders of convertible notes payable totaling $511,660 agreed to
forgive the debt.
 
 On June
30, 2008, a convertible note payable in the amount of $162,149 was converted
into 6,485,970 shares of the Company’s common stock at $0.025 per
share.  A difference between the conversion price of $0.025 and market
price on the date of conversion of $0.001 per share resulted in the Company
recording $155,663 to forgiveness of debt.  (Note 9)
  On June
23, 2008, the holder of a convertible note payable in the amount of $75,000
agreed to forgive the note.
 
 On June
30, 2008, convertible notes payable totaling $760,940 were converted into
30,437,600 shares of the Company’s common stock at $0.025 per
share.  A difference between the conversion price of $0.025 and market
price on the date of conversion of $0.001 per share resulted in the Company
recording forgiveness of debt of $730,503.  (Note 9)
 
 On June
23, 2008, $540,014 in interest accrued on the convertible notes payable was
forgiven.
 
 NOTE
5 – ADVANCES PAYABLE
 
 On June
23, 2008 $15,974 in advances payable were forgiven.
 
 On June
30, 2008, $16,385 in advances payable were converted into 655,400 shares of the
Company’s common stock at $0.025 per share.  The difference between
the conversion price of $0.025 and the market price on the date of conversion of
$0.001 per share resulted in the Company recording forgiveness of debt of
$15,730.  (Note 9)
  NOTE
6 – DUE TO RELATED PARTIES
 
 September
      30,
                    
                    
                    December
      31,2009
                    
                    
                    2008Due
      to a company sharing a common director (a)
                    
                    $
                    534
                    
                    
                    $
                    -Due
      to a company controlled by a relative of a major
    shareholder
                    
                    
                    33,107
                    
                    
                    
                    33,106Due
      to related parties
                    
                    $
                    33,266
                    
                    
                    $
                    33,106
 
 (a)  During
the nine months ended September 30, 2009 and 2008 the Company paid $78,232 and
$47,250 respectively, in administrative fees to a company sharing a common
director.
 
 On June
23, 2008, $161,550 in debt was forgiven by companies sharing a common
director.
 
 On June
30, 2008, a $13,766 advance payable to a director was converted into
550,626 shares of the Company’s common stock at $0.025 per share.  The
difference between the conversion price of $0.025 and the market price on the
date of conversion of $0.001 per share resulted in the Company recording
forgiveness of debt of $13,215.  (Note 9)
 
 On June
30, 2008, $239,090 in accrued management fees due to a former director were
converted into 9,563,602 shares of the Company’s common stock at $0.025 per
share. The difference between the conversion price of $0.025 and the market
price on the date of conversion of $0.001 per share resulted in the Company
recording forgiveness of debt of $229,526.  (Note 9)
 
 NOTE
7 – NOTE PAYABLE TO RELATED PARTY
 
 On June
30, 2008, the note payable to a related party in the amount of $500,000 was
converted into 20,000,000 shares of the Company’s common stock at $0.025 per
share. The difference between the conversion price of $0.025 and the market
price on the date of conversion of $0.001 per share resulted in the Company
recording forgiveness of debt of $480,000. (Note 9)
 
 On June
23, 2008, $267,227 in accrued interest was forgiven.
  9
  GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 SEPTEMBER
30, 2009
 (UNAUDITED)




NOTE
8 – RELATED PARTY PREPAIDS
 
 On
September 29, 2009 the Company prepaid $7,891 in administration fees for the
month of October to a company controlled by a director.
  NOTE
9 – COMMON STOCK
 
 On June
30, 2008, the Company issued 67,693,198 shares of their common stock at $0.025
per share in settlement of $1,692,330 in debt. A difference between the
conversion price of $0.025 and market price on the date of conversion of $0.001
per share resulted in the Company recording $1,624,637 as forgiveness of debt.
(Notes 4, 5, 6 and 7)
 
 NOTE
10 – SALE OF SUBSIDIARY
 
 On June
12, 2008 the Company sold all of its shares in Global Axxess for $2 to unrelated
parties. The sale of Global Axxess did not have any effect on the Companies
operations because Global Axxess was inactive.
 
 NOTE
11 – ROYALTY AGREEMENT
 
 On
November 1, 2004 the Company agreed, pursuant to a termination and transfer
agreement, to discontinue, marketing, distributing and installing global
wireless tracking and telematics equipment in Europe, which was carried on
through its wholly-owned subsidiary, GlobeTrac Limited, in exchange for certain
assets and liabilities and a six percent royalty to be paid to GlobeTrac Inc. on
gross sales of all existing and qualified potential customers that the Company
had in Europe.
  NOTE
12  – COMMITMENT
 
 The
Company had no contingencies or long-term commitments at September 30,
2009.  Due to the forgiveness of debt and conversion of debt into
common shares of the Company, the Company had no contractual obligations at
September 30, 2009.


10




Item
2.  Management’s Discussion and Analysis of Financial Condition and
Results of Operation.


Forward
Looking Statements
 
 The
information in this quarterly report on Form 10-Q contains forward-looking
statements.  These forward-looking statements involve risks and
uncertainties, including statements regarding our capital needs, business
strategy and expectations.  Any statements contained herein that are
not statements of historical facts may be deemed to be forward-looking
statements.  In some cases, you can identify forward-looking
statements by terminology such as may, will, should, expect, plan, intend, anticipate, believe, estimate, predict, potential or continue, the negative of
such terms or other comparable terminology.  Actual events or results
may differ materially from those events or results included in the
forward-looking statements.  In evaluating these statements, you
should consider various factors, including the risks outlined from time to time
in the reports we file with the Securities and Exchange
Commission.  Some, but not all, of these risks include, among other
things:
 
 *
              our
      inability to obtain the financing we need to continue our
      operations;
 
 *
              changes
      in regulatory requirements that adversely affect our
    business;
 
 *
              a
      decline in our royalty revenue; and
 
 *
              risks
      over which we have no control, such as a general downturn in the economy
      which may adversely affect our royalty revenue and ability to obtain
      working capital.
 
 We do not
intend to update forward-looking statements.  You should refer to and
carefully review the information in future documents we file with the Securities
and Exchange Commission.
 
 General
 
 This
discussion and analysis should be read in conjunction with our interim unaudited
financial statements and related notes included in this Form 10-Q and the
audited financial statements and related notes thereto included in our Annual
Report on Form 10-K for the fiscal year ended December 31, 2008.  The
inclusion of supplementary analytical and related information herein may require
us to make estimates and assumptions to enable us to fairly present, in all
material respects, our analysis of trends and expectations with respect to our
results of operations and financial position taken as a whole.  Actual
results may vary from the estimates and assumptions we make.
  When we
use the words “we”, “us” or “our” in this report, we are referring to GlobeTrac
Inc. which we sometimes refer to in this report as “GlobeTrac”.
 
 Overview
 
 We were
incorporated in the state of Delaware on March 2, 2000 as 411 Place.com
Inc.  On February 28, 2001, we changed our name to Artescope, Inc. and
on July 29, 2002 changed the name to GlobeTrac Inc.  Our principal
executive offices are headquartered in Canada.  On August 27, 2002, we
acquired 100% of the shares of Global Axxess Corporation Limited (Global
Axxess), a company incorporated in Ireland.  On June 12, 2008 we sold
our shares of Global Axxess, our only subsidiary.  Global Axxess owned
100% of the issued and outstanding shares of Globetrac Limited (Limited), a
company incorporated in the United Kingdom, until March 20, 2007 when Limited
was officially dissolved and all of Limited’s assets and liabilities were
assumed by GlobeTrac. As a result of terminating our operations in Europe, we
are seeking new business opportunities.
  At
September 30, 2009, our only source of income is a six percent
commission/royalty that we receive from WebTech Wireless Inc. (“WebTech”), based
on all qualified sales of any product or service offered by WebTech. A qualified
sale means all of WebTech’s invoiced sales of products or services to a customer
that has ordered at least one product or service before November 26, 2005,
whether sold by WebTech or by a licensee, affiliate or agent of WebTech. A list
of customers was provided to WebTech by GlobeTrac. There is no cap on the
royalty receivable and royalties are to be paid by WebTech for eleven years,
beginning November 1, 2004 and ending October 31, 2015.
  11
  On June
23, 2008 certain debt holders forgave $3,196,063 in debt.  On June 30,
2008 certain debt holders agreed to convert $67,693 in debt into 67,693,198
shares of our common stock.
 
 Results
of Operation
 
 Our
operating results for the three and nine months ended September 30, 2009 and
2008 and the changes between those periods summarized as follows:
 
 Three
      Months Ended
                                                                      September
      30,
                                                                    
                                                                    
                                                                    Increase
      (Decrease
                                                                      Between
      theThree
                                                                      Months Ended
                                                                    
                                                                    
                                                                    Nine
      Months Ended
                                                                      September
      30,
                                                                    
                                                                    
                                                                    Increase
      (Decrease)
                                                                      Between theNine
                                                                      Months Ended2009
                                                                    
                                                                    
                                                                    2008
                                                                    
                                                                    
                                                                    September
      30,
                                                                      2009
      and 2008
                                                                    
                                                                    
                                                                    2009
                                                                    
                                                                    
                                                                    2008
                                                                    
                                                                    
                                                                    September
      30,
                                                                      2009
      and 2008Royalty
      income
                                                                    
                                                                    $
                                                                    16,818
                                                                    
                                                                    
                                                                    $
                                                                    51,781
                                                                    
                                                                    
                                                                    $
                                                                    (34,963
                                                                    )
                                                                    
                                                                    $
                                                                    50,388
                                                                    
                                                                    
                                                                    $
                                                                    124,685
                                                                    
                                                                    
                                                                    $
                                                                    (74,297
                                                                    )Operating
      expenses:General
      andAdministrative
                                                                    
                                                                    
                                                                    29,235
                                                                    
                                                                    
                                                                    
                                                                    39,949
                                                                    
                                                                    
                                                                    
                                                                    (10,714
                                                                    )
                                                                    
                                                                    
                                                                    93,044
                                                                    
                                                                    
                                                                    
                                                                    85,608
                                                                    
                                                                    
                                                                    
                                                                    7,436Net
      income (loss) from operations
                                                                    
                                                                    
                                                                    (12,417
                                                                    )
                                                                    
                                                                    
                                                                    11,832
                                                                    
                                                                    
                                                                    
                                                                    (24,249
                                                                    )
                                                                    
                                                                    
                                                                    (42,656
                                                                    )
                                                                    
                                                                    
                                                                    39,077
                                                                    
                                                                    
                                                                    
                                                                    (81,733
                                                                    )Interest
      expense
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    46,618
                                                                    
                                                                    
                                                                    
                                                                    (46,618
                                                                    )Net
      income (loss) from operations before forgiveness of debt
                                                                    
                                                                    
                                                                    (12,417
                                                                    )
                                                                    
                                                                    
                                                                    11,832
                                                                    
                                                                    
                                                                    
                                                                    (24,249
                                                                    )
                                                                    
                                                                    
                                                                    (42,656
                                                                    )
                                                                    
                                                                    
                                                                    (7,541
                                                                    )
                                                                    
                                                                    
                                                                    (35,115
                                                                    )Forgiveness
      of debt
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    -
                                                                    
                                                                    
                                                                    
                                                                    3,196,063
                                                                    
                                                                    
                                                                    
                                                                    (3,196,063
                                                                    )Net
      income (loss)
                                                                    
                                                                    $
                                                                    (12,417
                                                                    )
                                                                    
                                                                    $
                                                                    11,832
                                                                    
                                                                    
                                                                    $
                                                                    (24,249
                                                                    )
                                                                    
                                                                    $
                                                                    (42,656
                                                                    )
                                                                    
                                                                    $
                                                                    3,188,522
                                                                    
                                                                    
                                                                    $
                                                                    (3,231,178
                                                                    )
 
 Revenues
 
 Our
royalty revenue decreased by $34,963 or 68% from $51,781 for the three months
ended September 30, 2008 to $16,818 for the three months ended September 30,
2009.
 
 Our
royalty revenue decreased by $74,297 or 60% from $124,685 for the nine months
ended September 30, 2008 to $50,388 for the nine months ended September 30,
2009.
 
 All of
our revenue was the result of a 6% royalty which relates to the Termination and
Transfer Agreement signed on October 18, 2005. The revenue we receive from
WebTech is in British Pounds.   The 60% decrease in revenue
during the nine months ended September 30, 2009 was due in part to strengthening
of the US dollar against the British Pound during this period as well as a
decrease in the revenue earned in British Pounds of 50%.  We do not
expect revenue to increase unless we locate a new revenue generating business
opportunity.
 
 Operating
Expenses
 
 Our
operating expenses decreased by $10,714 or 37% from $39,949 for the three months
ended September 30, 2008 to $29,235 for the three months ended September 30,
2009.  This decrease was primarily caused by a decrease in
professional fees of $9,243 and an increase of $9,832 in foreign exchange gains.
These increases were offset primarily by an increase in administration fees of
$7,876 due to fees associated with outsourcing our accounting and administrative
functions.
  12
 
 Our
operating expenses increased by $7,436 or 9% from $85,608 for the nine months
ended September 30, 2008 to $93,044 for the nine months ended September 30,
2009.  This increase was primarily caused by approximate increases in
administration fees of $23,626 due to fees associated with outsourcing our
accounting and administrative functions and in filing fees of $3,558 due
additional filing requirements as a result of being domiciled in British
Columbia, Canada.  These increases were offset primarily by a decrease
in professional fees of $12,280 and an increase of  $8,593 in foreign
exchange gains.
 
 Over the
next year our plan is to continue to control our operating costs.  We
expect our operating costs to remain approximately the same over the next year,
unless we locate a new viable business.
  Interest
Expense
 
 Interest
expense for the three months ended September 30, 2008 and 2009 was $0 in both
periods due to the conversion of some debt to shares and the forgiveness of
other debt.
 
 Our
interest expense decreased by $46,618 or 100% from $46,618 for the nine months
ended September 30, 2008 to $0 for the nine months ended September 30,
2009.
 
 Our
interest expense decreased due to the holders of $586,660 in convertible notes
payable agreeing to forgive the debt and when holders of $923,089 in convertible
notes payable and the holder of $500,000 note payable to a related party
converted their debt into shares of our common stock.
  Liquidity
and Capital Resources
 
 Going
Concern
 
 The notes
to our financial statements at September 30, 2009 disclose our uncertain ability
to continue as a going concern.  We were in the business of selling,
marketing, distributing and installing global wireless tracking and telematics
equipment in Europe until November 1, 2004 when we exchanged our rights to sell,
market, distribute and install global wireless tracking and telematics equipment
in Europe as well as specific assets and liabilities, for a royalty of 6% on
future gross sales to current customers and qualified potential customers in
Europe. There is no cap on the royalties and royalties are to be paid for the
duration of 11 years, ending October 31, 2015.  We have accumulated a
deficit of $1,377,790 since inception and additional financing will be required
to fund and support our operations. We plan to mitigate our losses in future
years by controlling our operating expenses and seeking out new business
opportunities.  However, there is no assurance that we will be able to
obtain additional financing, control our operating expenses or be successful in
locating or acquiring a viable business.  The financial statements do
not include any adjustments that might result from the outcome of these
uncertainties.
 
 As of
September 30, 2009, we had a cash balance of $14,872, a working capital deficit
of $107,410 and negative cash flows from operations of $8,270 for the nine
months then ended. During the nine months ended September 30, 2009, we primarily
funded our operations with the royalty revenue we received from WebTech and
collections of outstanding accounts receivable.
 
 The
following table summarizes our sources and uses of cash for the nine months
ended September 30, 2009 and 2008:
 
 September
      30,2009
                      
                      
                      2008Net
      cash (used in) provided by operating activities
                      
                      $
                      (8,270
                      )
                      
                      $
                      40,891Net
      cash used in investment activities
                      
                      
                      -
                      
                      
                      
                      -Net
      cash provided by financing activities
                      
                      
                      -
                      
                      
                      
                      -Effect
      of foreign currency exchange
                      
                      
                      (3,396
                      )
                      
                      
                      3,793Net
      (decrease) increase in cash
                      
                      $
                      (11,666
                      )
                      
                      $
                      44,684
 
 13
  Net
Cash Provided Operating Activities
 
 Net cash
used in operating activities during the nine months ended September 30, 2009 was
$8,270. This cash was primarily used to cover our net loss of $42,656, an
increase in our prepaids of $7,891, a decrease in accrued professional fees of
$5,775 and the effect of foreign currency exchange of $3,396.  These
uses of cash were offset by a decrease in our accounts receivable of $34,135 due
to payment of royalties by WebTech an increase in our accounts payable of
$12,382 and an increase in accrued accounts payable of $1,001.
 
 Net cash
provided by operating activities during the nine months ended September 30,
2008 was $40,891. This cash was primarily provided by a collection of $18,404 in
accounts receivable, utilization of $4,035 in prepaid expenses, $34,187 in
accrued interest payable on notes payable, $14 in advances payable, $12,431 in
accrued interest payable on note payable to a related party and $3,793 for the
effects of foreign currency translation. These amounts were offset by payments
of $15,957 in accrued liabilities and of $4,682 in accounts
payable.
 
 Net
Cash Used In Investing Activities
 
 We did
not have any investing activities during the nine months ended September 30,
2009 and 2008.
 
 Net
Cash Provided By Financing Activities
 
 We did
not have any financing activities during the nine months ended September 30,
2009 and 2008.
 
 Conversion
of Debt
 
 On June
23, 2008, we converted $923,089 in convertible notes payable, $16,385 in
advances payable, $252,856 in debt due to related parties and a $500,000 note
payable to a related party into 67,693,198 shares of our common
stock.
 
 Challenges
and Risks
 
 We have
accumulated a deficit of approximately $1.4 million to date and will require
additional debt or equity financing to continue operations and to seek out new
business opportunities. We plan to mitigate our losses in future years through
the receipt of the royalty payments from Webtech and locating a viable
business.
 
 There is
no assurance that we will be able to obtain additional financing, be successful
in seeking new business opportunities, receive any royalties from WebTech or
that we will be able to reduce operating expenses.
  Other
Trends, Events or Uncertainties that may Impact Results of Operations or
Liquidity
 Trends,
Events, and Uncertainties
 
 The
economic downturn may make it harder for us to raise capital if we need
it.  Therefore, in the future, the economic downturn may have a
material adverse effect on our ability to raise operating
capital.  Other than as discussed in this 10-Q report, we know of no
other trends, events or uncertainties that have or are reasonably likely to have
a material impact on our short-term or long-term liquidity.
 
 Off-balance
Sheet Arrangements
 
 We have
no off-balance sheet arrangements and no non-consolidated, special-purpose
entities.
 
 Contingencies and
Commitments
 
 We had no
contingencies or long-term commitments at September 30, 2009.
 
 Contractual
Obligations
 
 We had no
contractual obligations at September 30, 2009.
  14
 
 Critical
Accounting Judgments
 
 An
appreciation of our critical accounting policies is necessary to understand our
financial results. These policies may require management to make difficult and
subjective judgments regarding uncertainties, and as a result, such estimates
may significantly impact our financial results. The precision of these estimates
and the likelihood of future changes depend on a number of underlying variables
and a range of possible outcomes. Other than our accounting for our royalty
revenue, our critical accounting policies do not involve the choice between
alternative methods of accounting. We have applied our critical accounting
policies and estimation methods consistently.
 
 Accounts
Receivable
 
 Receivables
represent valid claims against debtors for royalties arising on or before the
balance sheet date and are reduced to their estimated net realizable
value.  An allowance for doubtful accounts is based on an assessment
of the collectibility of all past due accounts.
 
 At
September 30, 2009, accounts receivable consists of estimated royalty revenue
for the months of August and Sepember 2009.  Our estimate was based on
the amounts we received from WebTech in the prior months of 2009.  As
of the date of filing we had not received payment of the accrued royalty revenue
and thus our estimated accrual could vary materially from the amount we accrued
at September 30, 2009.
 
 Financial
Instruments
 
 Foreign
Exchange Risk
 
 We are
subject to foreign exchange risk on our royalty revenue which is denominated in
UK pounds and some purchases which are denominated in Canadian dollars. Foreign
currency risk arises from the fluctuation of foreign exchange rates and the
degree of volatility of these rates relative to the United States
dollar.  Foreign exchange rate fluctuations may adversely impact our
results of operations as exchange rate fluctuations on transactions denominated
in currencies other than our functional currency result in gains and losses that
are reflected in our Income Statement. To the extent the U.S. dollar
weakens against foreign currencies, the translation of these foreign
currency-denominated transactions will result in increased net revenue.
Conversely, our net revenue will decrease when the U.S. dollar strengthens
against foreign currencies. We do not believe that we have any material risk due
to foreign currency exchange.
 
 Fair
Value of Financial Instruments
 
 Our
financial instruments include cash, accounts receivable, accounts payable,
accrued liabilities and accrued professional fees. We believe the fair value of
these financial instruments approximate their carrying values due to their short
maturities.
 
 Concentration
of Credit Risk
 
 Financial
instruments that potentially subject us to significant concentrations of credit
risk consist principally of cash and trade accounts receivable.
 
 At
September 30, 2009, we had approximately $14,872 in cash on deposit with a large
chartered Canadian bank.  At September 30, 2009, $11,450 of this cash
was not insured.  As part of our cash management process, we perform
periodic evaluations of the relative credit standing of this financial
institution.  We have not experienced any losses in cash balances and
do not believe we are exposed to any significant credit risk on our
cash.
 
 Accounts
receivable consists of royalty income from one source and is not
collateralized.  We continually monitor the financial condition of our
customers to reduce the risk of loss.  We routinely assess the
financial strength of our source of revenue income and as a consequence,
concentration of credit risk is limited. At September 30, 2009, we had $9,694 in
royalties’ receivable from this source.
  15
 
 Recent
Accounting Standards and Pronouncements
 
 In
December 2007, the FASB issued SFAS No. 141(R), Business Combinations ,(ASC
808, Collaborative
Arrangements) “ASC 808”, which replaces SFAS 141, Business Combinations,
requires an acquirer to recognize the assets acquired, the liabilities assumed,
and any non-controlling interest in the acquiree at the acquisition date,
measured at their fair values as of that date, with limited exceptions. This
Statement also requires the acquirer in a business combination achieved in
stages to recognize the identifiable assets and liabilities, as well as the
non-controlling interest in the acquiree, at the full amounts of their fair
values. ASC 808 makes various other amendments to authoritative literature
intended to provide additional guidance or to confirm the guidance in that
literature to that provided in this Statement. This Statement applies
prospectively to business combinations for which the acquisition date is on or
after the beginning of the first annual reporting period beginning on or after
December 15, 2008.  This statement was effective for us on
January 1, 2009.  We expect ASC 808 will have an impact on our
accounting for future business combinations, but the effect is dependent upon
the acquisitions that are made in the future.
 
 In
December 2007, the EITF of the FASB reached a consensus on Issue
No. 07-1, Accounting for
Collaborative Arrangements(ASC 808 Collaborative
Arrangements) "ASC 808". The EITF concluded on the
definition of a collaborative arrangement and that revenues and costs incurred
with third parties in connection with collaborative arrangements would be
presented gross or net based on the criteria in EITF 99-19 and other accounting
literature. Based on the nature of the arrangement, payments to or from
collaborators would be evaluated and its terms, the nature of the entity’s
business, and whether those payments are within the scope of other accounting
literature would be presented. Companies are also required to disclose the
nature and purpose of collaborative arrangements along with the accounting
policies and the classification and amounts of significant financial-statement
amounts related to the arrangements. Activities in the arrangement conducted in
a separate legal entity should be accounted for under other accounting
literature; however required disclosure under ASC 808 applies to the
entire collaborative agreement. ASC 808 is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years, and is to be applied retrospectively
to all periods presented for all collaborative arrangements existing as of the
effective date. ASC 808 was effective for us on January 1,
2009.  Adoption of ASC 808 did not have a significant
impact on our financial statements.
 
 Effective
January 1, 2009, we adopted Financial Accounting Standards Board's (FASB)
Statement No. 160  Noncontrolling Interests in
Consolidated Financial Statements – an Amendment of ARB No. 51(ASC 810,
Consolidation) “ASC
810”,. ASC 810 changed the accounting and reporting for minority interests,
which will be recharacterized as noncontrolling interests and classified as a
component of equity.  ASC 810 required retrospective adoption of the
presentation and disclosure requirements for existing minority interests. 
All other requirements of ASC 810 will be applied prospectively.  The
adoption of ASC 810 did not have a material impact on the Company's financial
statements.
 
 In
March 2008, the FASB issued SFAS No. 161  Disclosures about Derivative
Instruments and Hedging Activities – An Amendment of FASB Statement No. 133
(SFAS 133)(ASC 815 Derivatives and Hedging) “ASC
815”. This
statement is intended to improve financial reporting of derivative instruments
and hedging activities by requiring enhanced disclosures about (a) how and why
an entity uses derivative instruments, (b) how derivative instruments and
related hedged items are accounted for under SFAS 133 and its related
interpretations and (c) how derivative instruments and related hedged items
affect an entity’s financial position, financial performance and cash flows. The
provisions of ASC 815 are effective for fiscal years beginning after
November 15, 2008.  This statement was effective for us on
January 1, 2009.  Early adoption of this provision was prohibited. The
adoption of this statement did not have a material impact on our financial
statements.
 
 In April
2008, the FASB issued FSP No. 142-3, Determination of the Useful Life of
Intangible Assets (ASC 30-50General Intangibles Other than
Goodwill) “ASC 30-50”. ASC 30-50 amends the factors to be considered in
developing renewal or extension assumptions used to determine the useful life of
intangible assets under SFAS No. 142, Goodwill and Other Intangible
Assets. Its intent is to improve the consistency between the useful life
of an intangible asset and the period of expected cash flows used to measure its
fair value. This FSP is effective prospectively for intangible assets acquired
or renewed after January 1, 2009. The adoption of ASC 30-50 did not have a
material impact on our financial statements. .
  16
  On May 9,
2008, the FASB issued FASB Staff Position No. APB 14-1 , Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement)(ASC 470-20Debt with Conversion and Other
Options) “ASC 470-20”.ASC 470-20 clarifies that convertible debt instruments that may be
settled in cash upon conversion (including partial cash settlement) are not
addressed by paragraph 12 of APB Opinion No. 14, Accounting for Convertible Debt and
Debt Issued with Stock Purchase Warrants.  Additionally, ASC
470-20 specifies that issuers of such instruments should separately account for
the liability and equity components in a manner that will reflect the entity’s
nonconvertible debt borrowing rate when interest cost is recognized in
subsequent periods. ASC 470-20 is effective for financial statements issued for
fiscal years beginning after December 15, 2008, and interim periods within those
fiscal years. ASC 470-20 was effective for us on January 1, 2009.  The
adoption of ASC 470-20 did not have a material impact on our results of
operations or financial position.
 
 On June
16, 2008, the FASB issued FASB Staff Position No. EITF 03-6-1 , Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities(ASC 260Earnings per
Share) “ASC 260”, to address the question of
whether instruments granted in share-based payment transactions are
participating securities prior to vesting. ASC 260 indicates that unvested
share-based payment awards that contain rights to dividend payments should be
included in earnings per share calculations. The guidance will be effective for
fiscal years beginning after December 15, 2008. ASC 260 was effective for us on
January 1, 2009.  The adoption of ASC 260 did not have a material
impact on our results of operations or financial position.
  In June
2008, the FASB issued EITF Issue 07-5, Determining whether an Instrument
(or Embedded Feature) is indexed to an Entity’s Own Stock(ASC
815-40Contracts in Entity’s
own Equity) “ASC 815-40”.  ASC 815-40 is effective for
financial statements issued for fiscal years beginning after December 15, 2008,
and interim periods within those fiscal years. Early application is not
permitted. Paragraph 11(a) of SFAS No. 133 Accounting for Derivatives and
Hedging Activities, specifies that a contract that would otherwise meet
the definition of a derivative but is both (a) indexed to the Company’s own
stock and (b) classified in stockholders’ equity in the statement of financial
position would not be considered a derivative financial instrument. ASC 815-40
provides a new two-step model to be applied in determining whether a financial
instrument or an embedded feature is indexed to an issuer’s own stock and thus
able to qualify for the SFAS No. 133 paragraph 11(a) scope
exception.  ASC 815-40 was effective for us on January 1,
2009.  Adoption of ASC 815-40 did not have a material impact on our
financial statements.
 
 In June
2009, the FASB issued Statement No. 168, Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting Principles (ASC
105,Generally Accepted
Accounting Principles) “ASC 105”. ASC 105. ASC 105 will become the single
source of authoritative nongovernmental U.S. generally accepted accounting
principles ("GAAP"), superseding existing FASB, American Institute of Certified
Public Accountants ("AICPA"), Emerging Issues Task Force ("EITF"), and related
accounting literature. ASC 105 reorganizes the thousands of GAAP pronouncements
into roughly 90 accounting topics and displays them using a consistent
structure. Also included is relevant Securities and Exchange Commission guidance
organized using the same topical structure in separate sections. ASC 105 will be
effective for financial statements issued for reporting periods that end after
September 15, 2009, which means July 1, 2009 for us. The adoption of the
Codification did not have an impact on our financial position or results of
operations.


17




Item
3.  Quantitative and Qualitative Disclosures About Market
Risk.





GlobeTrac
is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and
is not required to provide the information required under this
item.





Item
4.  Controls and Procedures.





Disclosure Controls and
Procedures





Disclosure
controls and procedures are designed to ensure that information required to be
disclosed in the reports filed or submitted under the Exchange Act is recorded,
processed, summarized and reported, within the time period specified in the
SEC’s rules and forms.  Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in the reports filed under the Exchange Act is
accumulated and communicated to management, including John daCosta, GlobeTrac’s
Chief Executive Officer and Chief Financial Officer, as appropriate, to allow
timely decisions regarding required disclosure.





Mr.
daCosta has evaluated the effectiveness of the design and operation of
GlobeTrac’s disclosure controls and procedures (as such term is defined in Rules
13a-15 and 15d-15 under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end
of the period covered by this quarterly report (the “Evaluation
Date”).  Based on such evaluation, Mr. daCosta has concluded
that, as of the Evaluation Date, GlobeTrac’s disclosure controls and procedures
are effective to ensure that information required to be disclosed in the reports
GlobeTrac files and submits under the Exchange Act is recorded, processed,
summarized and reported as and when required.





Changes in Internal Control
Over Financial Reporting





During
the quarter of the fiscal year covered by this report, there were no changes in
GlobeTrac’s internal control over financial reporting or, to GlobeTrac’s
knowledge, in other factors that have materially affected, or are reasonably
likely to materially affect, GlobeTrac’s internal control over financial
reporting.





PART
II – OTHER INFORMATION





Item
1.  Legal Proceedings.





GlobeTrac
is not a party to any pending legal proceedings and, to the best of GlobeTrac’s
knowledge, none of GlobeTrac’s property or assets are the subject of any pending
legal proceedings.





Item
1A.  Risk Factors.





GlobeTrac
is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and
is not required to provide the information required under this
item.





Item
2.  Unregistered Sales of Equity Securities and Use of
Proceeds.





During
the quarter of the fiscal year covered by this report, (i) GlobeTrac did not
modify the instruments defining the rights of its shareholders, (ii) no rights
of any shareholders were limited or qualified by any other class of securities,
and (iii) GlobeTrac did not sell any unregistered equity securities that have
not previously been disclosed in a Form 8-K filed with the SEC.





Item
3.  Defaults Upon Senior Securities.





During
the quarter of the fiscal year covered by this report, no material default has
occurred with respect to any indebtedness of GlobeTrac.  Also, during
this quarter, no material arrearage in the payment of dividends has
occurred.




18





Item
4.  Submission of Matters to a Vote of Security Holders.





No matter
was submitted to a vote of security holders through the solicitation of proxies
or otherwise, during the quarter of the fiscal year covered by this
report.





Item
5.  Other Information.





During
the quarter of the fiscal year covered by this report, GlobeTrac reported all
information that was required to be disclosed in a report on Form
8-K.





Item
6.  Exhibits





(a)
            Index
      to and Description of Exhibits





All
Exhibits required to be filed with the Form 10-Q are included in this quarterly
report or incorporated by reference to GlobeTrac’s previous filings with the
SEC, which can be found in their entirety at the SEC website at www.sec.gov under SEC
File Number 000-33309 and SEC File Number 333-66590.





Exhibit
            Description
            Status3.1
            Articles
      of Incorporation filed as an Exhibit to GlobeTrac’s registration statement
      on Form SB-2 filed on August 2, 2001, and incorporated herein by
      reference.
            Filed3.2
            Bylaws
      filed as an Exhibit to GlobeTrac’s registration statement on Form SB-2
      filed on August 2, 2001, and incorporated herein by
    reference.
            Filed3.3
            Certificate
      of Amendment to Articles of Incorporation changing the Issuer’s name to
      GlobeTrac Inc. filed as an exhibit to GlobeTrac’s Form 10-KSB filed on
      April 15, 2003, and incorporated herein by reference.
            Filed3.4
            Notification
      of Dissolution for Globetrac Limited dated March 14, 2007, filed as an
      exhibit to GlobeTrac’s Form 10-KSB filed on April 16, 2007, and
      incorporated herein by reference.
            Filed10.1
            Master
      Distributorship Agreement dated June 19, 2002 among WebTech Wireless
      International, WebTech Wireless Inc. and Global Axxess Corporation Limited
      filed as an attached exhibit to GlobeTrac’s Form 8-K (Current Report)
      filed on September 11, 2002, and incorporated herein by
      reference.
            Filed10.2
            Loan
      Agreement dated November 27, 2002 between GlobeTrac Inc. and David
      Patriquin with attached promissory note dated November 27, 2002 filed as
      an exhibit to GlobeTrac’s Form 10-KSB (Annual Report) filed on April 15,
      2003, and incorporated herein by reference.
            Filed10.3
            Amendment
      Letter Agreement dated June 4, 2003, between WebTech Wireless
      International Inc. and Globetrac Limited for the purpose of amending terms
      of the Master Distributorship Agreement filed as an exhibit to GlobeTrac’s
      Form 10-KSB (Annual Report) filed on April 7, 2004, and incorporated
      herein by reference.
            Filed10.4
            Amendment
      Letter Agreement dated March 8, 2004 between WebTech Wireless
      International Inc. and Globetrac Limited for the purpose of amending terms
      of the Master Distributorship Agreement filed as an exhibit to GlobeTrac’s
      Form 10-KSB (Annual Report) filed on April 7, 2004, and incorporated
      herein by reference.
            Filed10.5
            Letter
      Agreement dated November 26, 2004 among Global Axxess Corporation Limited,
      WebTech Wireless International and WebTech Wireless Inc., filed as an
      exhibit to GlobeTrac’s Form 8-K (Current Report) filed on December 22,
      2004, and incorporated herein by reference.
            Filed10.6
            Termination
      and Transfer Agreement dated November 1, 2004 among GlobeTrac Inc., Global
      Axxess Corporation Limited, Globetrac Limited, WebTech Wireless Inc., and
      WebTech Wireless International, filed as an exhibit to GlobeTrac’s Form
      8-K (Current Report) filed on November 14, 2005, and incorporated herein
      by reference.
            Filed14
            Code
      of Ethics filed as an exhibit to GlobeTrac’s Form 10-KSB filed on April
      15, 2003, and incorporated herein by reference.
            Filed31
            Certifications
      pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
            Included32
            Certification
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.
            Included





19





SIGNATURES





In
accordance with the requirements of the Securities Exchange Act of 1934,
GlobeTrac Inc. has caused this report to be signed on its behalf by the
undersigned duly authorized person.




GLOBETRAC INC.Dated:   November
      13,
      2009
                  By:
                  /s/ John daCostaName:
                  John daCostaTitle:
                  CEO, President and CFO

                    (Principal
      Executive Officer and
                    Principal
      Financial Officer)