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 June
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 August 14,
    2009common
      stock - $0.001 par value
                      
                      89,883,198




PART
I – FINANCIAL INFORMATION





Item
1.                      Financial
Statements.




GLOBETRAC
      INC.BALANCE
      SHEETSJune
      30,
                                            2009
                                          
                                          
                                          December
      31,
                                            2008UnauditedASSETSCurrent
      assetsCash
                                          
                                          $
                                          31,698
                                          
                                          
                                          $
                                          26,538Accounts
      receivable
                                          
                                          
                                          11,514
                                          
                                          
                                          
                                          43,829Prepaids
                                          
                                          
                                          999
                                          
                                          
                                          
                                          999Total
      current assets
                                          
                                          $
                                          44,211
                                          
                                          
                                          $
                                          71,366LIABILITIES
      AND STOCKHOLDERS' DEFICITCurrent
      liabilitiesAccounts
      payable
                                          
                                          $
                                          59,508
                                          
                                          
                                          $
                                          43,074Accrued
      liabilities
                                          
                                          
                                          5,288
                                          
                                          
                                          
                                          5,287Accrued
      professional fees
                                          
                                          
                                          41,142
                                          
                                          
                                          
                                          51,257Due
      to related parties
                                          
                                          
                                          33,266
                                          
                                          
                                          
                                          33,106Total
      current liabilities
                                          
                                          
                                          139,204
                                          
                                          
                                          
                                          132,724Commitments
      and contingencies
                                          
                                          
                                          -
                                          
                                          
                                          
                                          -Stockholders'
      deficitPreferred
      stock $0.001 par value, 5,000,000 authorized, none issued
    andoutstanding
      at June 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 June 30, 2009 and December 31,
    2008
                                          
                                          
                                          89,883
                                          
                                          
                                          
                                          89,883Additional
      paid in capital
                                          
                                          
                                          1,167,085
                                          
                                          
                                          
                                          1,167,085Accumulated
      deficit
                                          
                                          
                                          (1,365,373
                                          )
                                          
                                          
                                          (1,335,134
                                          )Accumulated
      other comprehensive income
                                          
                                          
                                          13,412
                                          
                                          
                                          
                                          16,808Total
      stockholders' deficit
                                          
                                          
                                          (94,993
                                          )
                                          
                                          
                                          (61,358
                                          )Total
      liabilities and stockholders' deficit
                                          
                                          $
                                          44,211
                                          
                                          
                                          $
                                          71,366
  The
accompanying notes are an integral part of these financial
statements
  1
 
  GLOBETRAC
      INC.STATEMENTS
      OF OPERATIONSFOR
      THE THREE AND SIX MONTHS ENDED JUNE 30, 2009 AND 2008(UNAUDITED)Three
      months ended June 30,
                                              
                                              
                                              Six
      months ended June 30,2009
                                              
                                              
                                              2008
                                              
                                              
                                              2009
                                              
                                              
                                              2008Royalty
      income
                                              
                                              $
                                              10,357
                                              
                                              
                                              $
                                              38,708
                                              
                                              
                                              $
                                              33,570
                                              
                                              
                                              $
                                              72,904Operating
      expenses:General
      and administrative
                                              
                                              
                                              29,548
                                              
                                              
                                              
                                              26,921
                                              
                                              
                                              
                                              63,809
                                              
                                              
                                              
                                              45,659Net
      (loss) income from operations
                                              
                                              
                                              (19,191
                                              )
                                              
                                              
                                              11,787
                                              
                                              
                                              
                                              (30,239
                                              )
                                              
                                              
                                              27,245Interest
      Expense
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              (46,618
                                              )Net
      (loss) income from operations before forgiveness of debt
                                              
                                              
                                              (19,191
                                              )
                                              
                                              
                                              11,787
                                              
                                              
                                              
                                              (30,239
                                              )
                                              
                                              
                                              (19,373
                                              )Forgiveness
      of debt
                                              
                                              
                                              -
                                              
                                              
                                              
                                              3,196,063
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              3,196,063Net
      (loss) income from operations
                                              
                                              $
                                              (19,191
                                              )
                                              
                                              $
                                              3,207,850
                                              
                                              
                                              $
                                              (30,239
                                              )
                                              
                                              $
                                              3,176,690Net
      (loss) earnings per share - basic and diluted
                                              
                                              $
                                              (0.00
                                              )
                                              
                                              $
                                              0.14
                                              
                                              
                                              $
                                              (0.00
                                              )
                                              
                                              $
                                              0.14Weighted
      average number of shares outstanding - basic and diluted
                                              
                                              
                                              89,883,198
                                              
                                              
                                              
                                              22,933,881
                                              
                                              
                                              
                                              89,883,198
                                              
                                              
                                              
                                              22,561,941


The
accompanying notes are an integral part of these financial
statements
  2
 GLOBETRAC
      INC.STATEMENT
      OF STOCKHOLDERS' DEFICIT AND COMPREHENSIVE INCOMEFOR
      THE SIX MONTHS ENDED JUNE 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 six months ended June 30, 2008
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,176,690
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,176,690Foreign
      currency exchange gain
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (1,053
                                            )
                                            
                                            
                                            (1,053
                                            )Net
      comprehensive income
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            3,175,637Balance
      at June 30, 2008
                                            
                                            
                                            89,883,198
                                            
                                            
                                            
                                            89,883
                                            
                                            
                                            
                                            1,167,085
                                            
                                            
                                            
                                            (1,335,232
                                            )
                                            
                                            
                                            12,055
                                            
                                            
                                            
                                            (66,209
                                            )Net
      income for the six months ended December 31, 2008
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            98
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            98Foreign
      currency exchange gain
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            4,753
                                            
                                            
                                            
                                            4,753Net
      comprehensive loss
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            4,851Balance
      at December 31, 2008
                                            
                                            
                                            89,883,198
                                            
                                            
                                            
                                            89,883
                                            
                                            
                                            
                                            1,167,085
                                            
                                            
                                            
                                            (1,335,134
                                            )
                                            
                                            
                                            16,808
                                            
                                            
                                            
                                            (61,358
                                            )Net
      loss for the six months ended June 30, 2009
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (30,239
                                            )
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (30,239
                                            )Foreign
      currency exchange gain
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (3,396
                                            )
                                            
                                            
                                            (3,396
                                            )Net
      comprehensive loss
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            -
                                            
                                            
                                            
                                            (33,635
                                            )Balance
      at June 30, 2009
                                            
                                            
                                            89,883,198
                                            
                                            
                                            $
                                            89,883
                                            
                                            
                                            $
                                            1,167,085
                                            
                                            
                                            $
                                            (1,365,373
                                            )
                                            
                                            $
                                            13,412
                                            
                                            
                                            $
                                            (94,993
                                            )
  The
accompanying notes are an integral part of these financial
statements
  3
  GLOBETRAC
      INC.STATEMENTS
      OF CASH FLOWSFOR
      THE SIX MONTHS ENDED JUNE 30, 2009 AND 2008(UNAUDITED)2009
                                                          
                                                          
                                                          2008Cash
      flows from operating activities:Net
      (loss) income
                                                          
                                                          $
                                                          (30,239
                                                          )
                                                          
                                                          $
                                                          3,176,690Adjustments
      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
                                                          
                                                          
                                                          32,315
                                                          
                                                          
                                                          
                                                          26,030Prepaids
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          2,115Accounts
      payable
                                                          
                                                          
                                                          16,434
                                                          
                                                          
                                                          
                                                          5,504Accrued
      liabilities
                                                          
                                                          
                                                          1
                                                          
                                                          
                                                          
                                                          -Accrued
      professional fees
                                                          
                                                          
                                                          (10,115
                                                          )
                                                          
                                                          
                                                          (17,792
                                                          )Accrued
      interest on convertible notes payable
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          34,187Advances
      payable
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          14Due
      to related parties
                                                          
                                                          
                                                          160
                                                          
                                                          
                                                          
                                                          -Accrued
      interest on note payable to related party
                                                          
                                                          
                                                          -
                                                          
                                                          
                                                          
                                                          12,431Net
      cash provided by (used in) operating activities
                                                          
                                                          
                                                          8,556
                                                          
                                                          
                                                          
                                                          43,116Effect
      of foreign currency exchange
                                                          
                                                          
                                                          (3,396
                                                          )
                                                          
                                                          
                                                          (1,053
                                                          )Net
      increase (decrease) in cash
                                                          
                                                          
                                                          5,160
                                                          
                                                          
                                                          
                                                          42,063Cash,
      beginning of period
                                                          
                                                          
                                                          26,538
                                                          
                                                          
                                                          
                                                          16,922Cash,
      end of period
                                                          
                                                          $
                                                          31,698
                                                          
                                                          
                                                          $
                                                          58,985Supplemental
      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
                                                          
                                                          $
                                                          -
                                                          
                                                          
                                                          $
                                                          67,693
 The
accompanying notes are an integral part of these financial
statements
  4
 GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 JUNE
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
six months ended June 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(SFAS
141(R)), 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. SFAS 141(R) 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 SFAS 141(R) 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.
  5
 GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 JUNE
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(EITF 07-1). 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 EITF 07-1 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.
EITF 07-1 was effective for us on January 1, 2009.  Adoption of EITF
07-1 did not have a significant impact on our financial statements.
 
 Effective
January 1, 2009, Globetrac, Inc. adopted Financial Accounting Standards Board's
(FASB) Statement No. 160 (FAS 160), Noncontrolling Interests in
Consolidated Financial Statements – an Amendment of ARB No. 51. FAS 160
changed the accounting and reporting for minority interests, which will be
recharacterized as noncontrolling interests and classified as a component of
equity.  FAS 160 required retrospective adoption of the presentation and
disclosure requirements for existing minority interests.  All other
requirements of FAS 160 will be applied prospectively.  The adoption of FAS
160 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
(SFAS 133). 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 SFAS 161 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 (FSP 142-3). FSP 142-3 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 FSP 142-3 did not have a
material impact on our financial statements. .
  On May 9,
2008, the FASB issued FASB Staff Position No. APB 14-1 (FSP APB 14-1), Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement).FSP APB 14-1 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, FSP
APB 14-1 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. FSP APB14-1 is effective for financial statements issued for
fiscal years beginning after December 15, 2008, and interim periods within those
fiscal years. FSP APB 14-1 was effective for the Company on January 1,
2009.  The adoption of FSP APB 14-1 did not have a material impact on
our results of operations or financial position or our earnings per share share
calculations.
  6
  GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 JUNE
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 (FSP No. EITF
03-6-1), Determining Whether
Instruments Granted in Share-Based Payment Transactions Are Participating
Securities, to address the question of whether instruments granted in
share-based payment transactions are participating securities prior to vesting.
FSP EITF 03-6-1 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. FSP EITF 03-6-1 was effective for the Company on January 1,
2009.  The adoption of FSP EITF 03-6-1 did not have a material impact
on our results of operations or financial position.
 
 In June
2008, the FASB issued EITF Issue 07-5 (EITF 07-5), Determining whether an Instrument
(or Embedded Feature) is indexed to an Entity’s Own
Stock.  EITF No. 07-5 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.
EITF 07-5 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.  EITF 07-5 was effective for us on January 1,
2009.  Adoption of EITF 07-5 did not have a material impact on our
financial statements.
 
 In June
2009, the FASB issued Statement No. 168, ("SFAS 168") Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting Principles. SFAS 168
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. SFAS 168 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. SFAS 168 will be effective for financial statements issued for
reporting periods that end after September 15, 2009, which means July 1, 2009
for GlobeTrac, Inc. We do not expect the adoption of the Codification to 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 $1,365,373
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.
  7
 GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 JUNE
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 8)
  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 8)
 
 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 8)
  NOTE
6 – DUE TO RELATED PARTIES
 
 June
      30,
                            
                            
                            December
      31,2009
                            
                            
                            2008Due
      to a company sharing a common director (a)
                            
                            $
                            159
                            
                            
                            $
                            -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 six months ended June 30, 2009 and 2008 the Company paid $47,250 and $31,500
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 8)
 
 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 8)
 
 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 8)
 
 On June
23, 2008, $267,227 in accrued interest was forgiven.
  8
 GLOBETRAC
INC.
 NOTES
TO FINANCIAL STATEMENTS
 JUNE
30, 2009
 (UNAUDITED)
 NOTE
8 – 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
9 – 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
10 – 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 June 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 June
30, 2009.


9




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 June 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.




10




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 six months ended June 30, 2009 and 2008 and
the changes between those periods summarized as follows:




Three
      Months EndedJune
      30,
                
                
                
                Increase
      (Decrease) Between the
                  Three
      Months
                  Ended
      June 30, 2009
                
                
                
                Six
      Months Ended June 30,
                
                
                
                Increase
      (Decrease) Between the
                  SixMonths
                  Ended
      June 30, 20092009
                
                
                
                2008
                
                
                
                and
      2008
                
                
                
                2009
                
                
                
                2008
                
                
                
                and
      2008Royalty
      income
                
                $
                10,357
                
                
                $
                38,708
                
                
                $
                (28,351
                )
                
                $
                33,570
                
                
                $
                72,904
                
                
                $
                (39,334
                )Operating
      expenses:General andadministrative
                
                
                29,548
                
                
                
                26,921
                
                
                
                2,627
                
                
                
                63,809
                
                
                
                45,659
                
                
                
                18,150Net
      income (loss) from operations
                
                
                (19,191
                )
                
                
                11,787
                
                
                
                (30,978
                )
                
                
                (30,239
                )
                
                
                27,245
                
                
                
                (57,484
                )Interest
      expense
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                (46,618
                )
                
                
                46,618Net
      income (loss) from operations before forgiveness of debt
                
                
                (19,191
                )
                
                
                11,787
                
                
                
                (30,978
                )
                
                
                (30,239
                )
                
                
                (19,373
                )
                
                
                (10,866
                )Forgiveness of
      debt
                
                
                -
                
                
                
                3,196,063
                
                
                
                (3,196,063
                )
                
                
                -
                
                
                
                3,196,063
                
                
                
                (3,196,063
                )Net
      income (loss)
                
                $
                (19,191
                )
                
                $
                3,207,850
                
                
                $
                (3,227,041
                )
                
                $
                (30,239
                )
                
                $
                3,176,690
                
                
                $
                (3,206,929
                )





Revenues





Our
royalty revenue decreased by $28,351 or 73% from $38,708 for the three months
ended June 30, 2008 to $10,357 for the three months ended June 30,
2009.





Our
royalty revenue decreased by $39,334 or 54% from $72,904 for the six months
ended June 30, 2008 to $33,570 for the six months ended June 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 54% decrease in revenue
during the six months ended June 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.  We do not expect revenue to
increase unless we locate a new revenue generating business
opportunity.





Operating
Expenses





Our
operating expenses increased by $2,627 or 9% from $26,921 for the three months
ended June 30, 2008 to $29,548 for the three months ended June 30,
2009.  This increase was primarily caused by approximate increases in
administration fees of $7,875 due to fees associated with outsourcing our
accounting and administrative functions and in filing fees of $909 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 $6,845.




11




Our
operating expenses increased by $18,150 or 40% from $45,659 for the six months
ended June 30, 2008 to $63,809 for the six months ended June 30,
2009.  This increase was primarily caused by approximate increases in
administration fees of $15,750 due to fees associated with outsourcing our
accounting and administrative functions; in filing fees of $3,155 due additional
filing requirements as a result of being domiciled in British Columbia, Canada
and in foreign exchange expense of $1,239.  These increases were
offset primarily by a decrease in professional fees of $3,037.





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 June 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 six months
ended June 30, 2008 to $0 for the six months ended June 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 June 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 $1,365,373 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
June 30, 2009, we had a cash balance of $31,698, a working capital deficit of
$94,993 and positive cash flows from operations of $8,556 for the six months
then ended. During the six months ended June 30, 2009, we primarily funded our
operations with the royalty revenue we received from WebTech.





The
following table summarizes our sources and uses of cash for the six months ended
June 30, 2009 and 2008:





June
      30,2009
                        
                        
                        2008Net
      cash provided by operating activities
                        
                        $
                        8,556
                        
                        
                        $
                        43,116Net
      cash provided by investment activities
                        
                        
                        -
                        
                        
                        
                        -Net
      cash provided by financing activities
                        
                        
                        -
                        
                        
                        
                        -Effect
      of foreign currency exchange
                        
                        
                        (3,396
                        )
                        
                        
                        (
      1,053
                        )Net
      increase in cash
                        
                        $
                        5,160
                        
                        
                        $
                        42,063





12




Net
Cash Provided Operating Activities





Net cash
provided by operating activities during the six months ended June 30, 2009 was $8,556. This
cash was primarily provided by a decrease in our accounts receivable of
$32,315 due to payment of royalties by WebTech an increase in our accounts
payable of $16,434 which were offset by our loss of $30,239, a reduction of our
accrued professional fees by $10,115 and the effect of foreign currency exchange
of $3,396.





Net cash
provided by operating activities during the six months ended June 30, 2008
was $43,116. This cash was primarily provided by a collection of $26,030 in
accounts receivable, utilization of $2,115 in prepaid expenses, increases of
$5,504 in accounts payable, $34,187 in accrued interest payable on notes
payable, $14 in advances payable and $12,431 in accrued interest payable on note
payable to a related party. These amounts were offset by a payment of $17,792 in
accrued professional fees.





Net
Cash Used In Investing Activities





We did
not have any investing activities during the six months ended June 30, 2009 and
2008.





Net
Cash Provided By Financing Activities





We did
not have any financing activities during the six months ended June 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 $1.3 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 June 30, 2009.




13





Contractual
Obligations





We had no
contractual obligations at June 30, 2009.





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 June
30, 2009, accounts receivable consists of estimated royalty revenue for the
months of May and June 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 June 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 June
30, 2009, we had approximately $30,239 in cash on deposit with a large chartered
Canadian bank.  At June 30, 2009, $827 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.




14





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 June 30, 2009, we had $11,514 in
royalties’ receivable from this source.





Recent
Accounting Standards and Pronouncements





In
December 2007, the FASB issued SFAS No. 141(R), Business Combinations(SFAS
141(R)), 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. SFAS 141(R) 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 SFAS 141(R) 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(EITF 07-1). 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 EITF 07-1 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.
EITF 07-1 was effective for us on January 1, 2009.  Adoption of EITF
07-1 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 (FAS 160), Noncontrolling Interests in
Consolidated Financial Statements – an Amendment of ARB No. 51. FAS 160
changed the accounting and reporting for minority interests, which will be
recharacterized as noncontrolling interests and classified as a component of
equity.  FAS 160 required retrospective adoption of the presentation and
disclosure requirements for existing minority interests.  All other
requirements of FAS 160 will be applied prospectively.  The adoption of FAS
160 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
(SFAS 133). 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 SFAS 161 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 (FSP 142-3). FSP 142-3 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 FSP 142-3 did not have a
material impact on our financial statements.




15




On May 9,
2008, the FASB issued FASB Staff Position No. APB 14-1 (FSP APB 14-1), Accounting for Convertible Debt
Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash
Settlement).FSP APB 14-1 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, FSP
APB 14-1 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. FSP APB14-1 is effective for financial statements issued for
fiscal years beginning after December 15, 2008, and interim periods within those
fiscal years. FSP APB 14-1 was effective for us on January 1,
2009.  The adoption of FSP APB 14-1 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 (FSP No. EITF
03-6-1), Determining Whether
Instruments Granted in Share-Based Payment Transactions Are Participating
Securities, to address the question of whether instruments granted in
share-based payment transactions are participating securities prior to vesting.
FSP EITF 03-6-1 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. FSP EITF 03-6-1 was effective for us on January 1,
2009.  The adoption of FSP EITF 03-6-1 did not have a material impact
on our results of operations or financial position.




In June
2008, the FASB issued EITF Issue 07-5 (EITF 07-5), Determining whether an Instrument
(or Embedded Feature) is indexed to an Entity’s Own
Stock.  EITF No. 07-5 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.
EITF 07-5 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.  EITF 07-5 was effective for us on January 1,
2009.  Adoption of EITF 07-5 did not have a material impact on our
financial statements.





In June
2009, the FASB issued Statement No. 168, ("SFAS 168") Accounting Standards Codification
and the Hierarchy of Generally Accepted Accounting Principles. SFAS 168
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. SFAS 168 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. SFAS 168 will be effective for financial statements issued for
reporting periods that end after September 15, 2009, which means July 1, 2009
for us. We do not expect the adoption of the Codification to have an impact on
our financial position or results of operations.





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.




16





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.





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.




17





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




18




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.Date: August 14,
      2009
                  By:
                  /s/ John daCostaName:
                  John daCostaTitle:
                  CEO, President and
      CFO
                    (Principal Executive Officer
      and
                    Principal Financial
      Officer)






19