UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Report of Event occurring on December 14, 1999
Commission File No. 33-55254-16
HIGHTIDE INC.
NEVADA 87-0434292
(State or other jurisdiction (IRS Employer Identification
incorporated or organization) Number)
1800 East Sahara, Suite 107
Las Vegas, NV 89104
(Address of principal executive offices)
Registrant's Telephone Number, including area code: (702) 938-0253
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ITEM 1. Change in Control of Registrant.
An Agreement and Plan of Reorganization (the "Agreement") was made and entered
into by and among Hightide Inc., a Nevada corporation (the "Registrant"), and
Total Medical Inc., a Canadian corporation ("Total") and the shareholders of
Total ("Total Shareholders"). Pursuant to the Agreement, on December 14, 1999
the Registrant issued 10,000,000 shares of $.001 par value common stock of
Registrant to Total Shareholders in exchange for 100% of the issued and
outstanding common stock of Total.
The transaction effected pursuant to the Agreement was exempt from the
registration requirements of the Securities Act of 1933 by virtue of Section
4(2) thereof.
Following this transaction, the former Total shareholders owned 83.4% of the
Registrant.
Total operates a business in the medical field.
The Agreement is attached hereto as Exhibit A.
ITEM 2. Acquisition or Disposition of Assets.
See Item 1.
ITEM 5. Other Events.
On December 14, 1999, the Company effected a one-for-five reverse stock split.
Previously outstanding shares of 10,000,000 became 2,000,000 shares. After
10,000,000 shares were issued to the Total shareholders, outstanding shares are
12,000,000.
ITEM 6. Replacement of Directors.
On December 14, 1999, new directors were appointed. The following persons have
been appointed as directors of the Registrant:
Michel Dallaire
Michael Curtis
Antonio Care
ITEM 7. Financial Statements and Exhibits.
Financial statements of Total Medical are attached. Pro forma information is not
meaningful as it would essentially be the same information as is presented in
the Total Medical financial statements.
EXHIBIT INDEX
EXHIBIT A: Item 1. Agreement and Plan of Reorganization
EXHIBIT B: Item 7. Financial Statements
EXHIBIT C: Amendments To The Articles of Incorporation of Hightide Inc.
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SIGNATURES
Pursuant ot the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Hightide Inc.
(Registrant)
Date: December 22, 1999 By:
Michel Dallaire
President and Director
Hightide Inc.
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EXHIBIT "A"
AGREEMENT
THIS AGREEMENT is made this 14th day of December, 1999 by and among
Hightide Inc., a Nevada corporation, hereinafter called "HIGHTIDE", Total
Medical Inc., a Canadian corporation, hereinafter called "TOTAL", and the
shareholders of TOTAL, hereinafter called "TOTAL SHAREHOLDERS".
RECITALS:
WHEREAS, HIGHTIDE desires to acquire 100% of the issued and outstanding
shares of the common stock of TOTAL, in exchange for 10,000,000 authorized but
unissued shares of the $.001 par value common stock of HIGHTIDE, pursuant to a
plan of reorganization; and
WHEREAS, the TOTAL SHAREHOLDERS desire to exchange 100% of the issued
and outstanding shares of the common stock of TOTAL, currently owned by TOTAL
SHAREHOLDERS, in exchange for said 10,000,000 shares of HIGHTIDE.
NOW THEREFORE, in consideration of the mutual promises, covenants and
representations contained herein, and to consummate the foregoing plan of
reorganization, the parties hereby adopt said plan of reorganization and agree
as follows:
ARTICLE I
EXCHANGE OF SECURITIES
1.01 Issuance of HIGHTIDE Shares. Subject to all of the terms and
conditions of this Agreement, HIGHTIDE agrees to issue to TOTAL SHAREHOLDERS
10,000,000 fully paid and non-assessable unregistered shares of HIGHTIDE common
stock in exchange for 100% of the outstanding TOTAL common stock, all of which
is currently owned by TOTAL SHAREHOLDERS. Such shares to be issued are the
common shares as such are constituted following the one (1) for five (5) reverse
stock split authorized in HIGHTIDE on December 14th, 1999.
1.02 Transfer of TOTAL Shares. In exchange for HIGHTIDE's stock being
issued to TOTAL SHAREHOLDERS as above described, TOTAL SHAREHOLDERS shall on the
closing date and concurrent with such issuance of HIGHTIDE's common stock,
deliver to HIGHTIDE 100% of the outstanding common stock of TOTAL.
ARTICLE II
REPRESENTATIONS, AGREEMENTS AND WARRANTIES OF
TOTAL SHAREHOLDERS AND TOTAL
TOTAL SHAREHOLDERS AND TOTAL hereby represent, agree and warrant that:
2.01 Organization. TOTAL is a corporation duly organized, validly
existing, and in good standing under the laws of the Canada Business
Corporations Act, has all necessary corporate powers
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to own its properties and to carry on its business as now owned and operated by
it, is duly qualified to do business and is in good standing in any jurisdiction
its business requires qualification.
2.02 Capital. The authorized capital stock of TOTAL consists of an
unlimited number of shares of common stock. All of the 40,060,665 issued and
outstanding shares are validly issued, fully paid and non-assessable.
2.03 Subsidiaries. TOTAL owns 50% of Gestion MedicAction which in turn
owns 100% of Mediastruction 2000 Inc.
2.04 Directors and Officers. Exhibit 2.04 to this Agreement contains
the names and titles of all directors and officers of TOTAL as of the date of
this Agreement.
2.05 Financial Statements. Exhibit 2.05 to this Agreement includes the
audited financial statements of TOTAL as of May 31, 1999.
2.06 Absence of Changes. Since the date of TOTAL's most recent
financial statements included in Exhibit 2.05 there have been no changes in its
financial condition or operations, except for changes in the ordinary course of
business.
2.07 Absence of Undisclosed Liabilities. As of the date of TOTAL's most
recent balance sheet included in Exhibit 2.05 it did not have any material debt,
liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due, that is not reflected in such
balance sheet.
2.08 Tax Returns. Within the times and in the manner prescribed by law,
TOTAL has filed all federal, state and local tax returns required by law, has
paid all taxes, assessments and penalties due and payable and has made adequate
provision on its most recent balance sheet for any unpaid taxes.
There are no present disputes as to taxes of any nature payable by TOTAL.
2.09 Investigation of Financial Condition. Without in any manner
reducing or otherwise mitigating the representations contained herein, HIGHTIDE
and/or its attorneys shall have the opportunity to meet with accountants and
attorneys to discuss the financial condition of TOTAL. TOTAL shall make
available to HIGHTIDE and/or its attorneys all books and records of TOTAL. If
the transaction contemplated hereby is not completed, all documents received by
HIGHTIDE and/or its attorneys shall be returned to TOTAL and all information so
received shall be treated as confidential.
2.10 Patents, Trade Names and Rights. TOTAL owns or holds all necessary
patents, trademarks, service marks, trade names, copyrights and other rights
necessary to the conduct or proposed conduct of its business.
2.11 Compliance with Laws. TOTAL has complied with, and is not in
violation of, applicable federal, state or local statutes, laws and regulations
affecting its properties or the operation of its business.
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2.12 Litigation. TOTAL is not a party to, nor to the best of its
knowledge is there pending or threatened, any suit, action, arbitration or
legal, administrative or other proceeding, or governmental investigation
concerning its business, assets or financial condition. TOTAL is not in default
with respect to any order, writ, injunction or decree of any federal, state,
local or foreign court or agency, nor is it engaged in any lawsuits to recover
monies due to it.
2.13 Authority. The Board of Directors of TOTAL authorized the
execution of this Agreement and the consummation of the transactions
contemplated herein and have full power and authority to execute, deliver and
perform this Agreement.
2.14 Ability to Carry Out Obligations. The execution and delivery of
this Agreement by TOTAL and the performance of its obligations hereunder in the
time and manner contemplated will not cause, constitute or conflict with or
result in (i) any breach of the provisions of any license, indenture, mortgage,
charter, instrument, certificate of incorporation, bylaw or other agreement or
instrument to which it is a party or by which it may be bound, nor will any
consents or authorizations of any party other than those hereto be required,
(ii) an event that would permit any party to any agreement or instrument to
terminate it or to accelerate the maturity of any indebtedness or other
obligation, or (iii) an event that would result in the creation or imposition of
any lien, charge or encumbrance on any asset.
2.15 Full Disclosure. None of the representations and warranties made
by TOTAL SHAREHOLDERS or TOTAL herein or in any exhibit, certificate or
memorandum furnished or to be furnished by TOTAL SHAREHOLDERS or TOTAL, or on
either's behalf, contains or will contain any untrue statement of material fact,
or omits any material fact, the omission of which would be misleading.
2.16 Assets. TOTAL has good and marketable title to all of its property
free and clear of any and all liens, claims or encumbrances except as may be
indicated in Exhibit 2.05.
2.17 Indemnification. TOTAL SHAREHOLDERS and TOTAL agree to defend and
hold HIGHTIDE and its officers and directors harmless against and in respect of
any and all claims, demands, losses, costs, expenses, obligations, liabilities
or damages, including interest, penalties and reasonable attorney's fees, that
it shall incur or suffer, which arise out of, result from or relate to any
breach of this Agreement or failure by TOTAL SHAREHOLDERS or TOTAL to perform
with respect to any of its representations, warranties or covenants contained in
this Agreement or in any exhibit or other instrument furnished or to be
furnished under this Agreement.
2.18 Authority to Exchange. As of the date of this Agreement, TOTAL
SHAREHOLDERS hold 100% of the shares of TOTAL common stock. Such shares are
owned of record and beneficially by TOTAL SHAREHOLDERS and such shares are not
subject to any lien, encumbrance or pledge. TOTAL SHAREHOLDERS hold authority to
exchange such shares pursuant to this Agreement.
2.19 Investment Intent. TOTAL SHAREHOLDERS understand and acknowledge
that the shares of HIGHTIDE common stock offered for exchange or sale pursuant
to this Agreement are being offered in reliance upon the exemption from
registration requirements of the Securities Act of 1933, as amended (the "Act"),
pursuant to Section 4(2) of the Act and the rules and regulations promulgated
thereunder, for nonpublic offerings and make the following representations,
agreements and warranties
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with the intent that the same may be relied upon in determining the suitability
of TOTAL SHAREHOLDERS as a purchaser of HIGHTIDE common stock:
(a) The shares of HIGHTIDE common stock are being acquired solely for
the account of TOTAL SHAREHOLDERS, for investment purposes only, and not with a
view to, or for sale in connection with, any distribution thereof, and with no
present intention of distributing or reselling any part of the HIGHTIDE common
stock acquired;
(b) TOTAL SHAREHOLDERS agree not to dispose of their HIGHTIDE common
stock or any portion thereof unless and until counsel for HIGHTIDE shall have
determined that the intended disposition is permissible and does not violate the
Act or any applicable Federal or state securities laws, or the rules and
regulations thereunder;
(c) TOTAL SHAREHOLDERS agree that the certificates evidencing the
HIGHTIDE common stock acquired pursuant to this Agreement will have a legend
placed thereon stating that they have not been registered under the Act or any
state securities laws and setting forth or referring to the restrictions on
transferability and sale of the HIGHTIDE common stock, and that stop transfer
instructions shall be placed with the transfer agent for said certificate.
(d) TOTAL SHAREHOLDERS have carefully evaluated their financial
resources and investment position and the risks associated with this transaction
and are able to bear the economic risks of this transaction; and they have
substantial knowledge and experience in financial, business and investment
matters and are qualified as sophisticated investors, and are capable of
evaluating the merits and risks of this transaction; and they desire to acquire
the HIGHTIDE common stock on the terms and conditions set forth;
(e) TOTAL SHAREHOLDERS are able to bear the economic risk of an
investment in the HIGHTIDE common stock; and
(f) TOTAL SHAREHOLDERS understand that an investment in the HIGHTIDE
common stock is not liquid and TOTAL SHAREHOLDERS have no need for liquidity in
this investment.
2.20 Public "Shell" Corporation. TOTAL and TOTAL SHAREHOLDERS are aware
that HIGHTIDE has public shareholders and is a "shell" corporation without
significant assets or liabilities, and further that public companies are subject
to extensive and complex state, federal and other regulations. Among other
requirements, TOTAL SHAREHOLDERS and TOTAL are aware that a Form 8-K must be
filed with the United States Securities and Exchange Commission within fifteen
days after closing which filing requires that audited financial statements be
filed within sixty days after the filing of the 8-K, and they agree that such
responsibility shall not be the responsibility of the existing officers of
HIGHTIDE, but the sole responsibility of the new officers and directors of
HIGHTIDE. TOTAL SHAREHOLDERS and TOTAL are aware of the legal requirements and
obligations of public companies, understand that regulatory efforts regarding
public shell transactions similar to the transaction contemplated herein has
been and is currently being exerted by some states, the U.S. Securities and
Exchange Commission and the National Association of Securities Dealers, Inc.
(NASD), and are fully aware of their responsibilities, following closing, to
fully comply will all securities laws and regulations, and agree to do so.
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2.21 No Assurances or Warranties. TOTAL SHAREHOLDERS and TOTAL
acknowledge that there can be no assurance regarding the tax consequences of
this transaction, nor can there be any assurance that the Internal Revenue Code
or the regulations promulgated thereunder will not be amended in such manner as
to deprive them of any tax benefit that might otherwise be received. TOTAL
SHAREHOLDERS and TOTAL are relying upon the advice of their own tax advisors
with respect to the tax aspects of this transaction. No representations or
warranties have been made by HIGHTIDE, or their officers, directors, affiliates
or agents, as to the benefits to be derived by TOTAL SHAREHOLDERS or TOTAL in
completing this transaction, nor have any of them made any warranty or
agreement, expressed of implied, as to the tax or securities consequences of the
transactions contemplated by this Agreement or the tax or securities
consequences of any action pursuant to or growing out of this Agreement.
ARTICLE III
REPRESENTATIONS, AGREEMENTS AND WARRANTIES OF HIGHTIDE
HIGHTIDE represents, agrees and warrants that:
3.01 Organization. HIGHTIDE is a corporation duly organized, under the
laws of Nevada, has all necessary corporate powers to own properties and to
carry on its business as now owned and operated by it, is duly qualified to do
business and is in good standing in each of the jurisdictions where its business
requires qualification.
2.02 Capital. The authorized capital stock of HIGHTIDE
consists of 100,000,000 shares of $.001 value common stock of which
2,000,000 post reverse split shares are issued and outstanding. All of
the issued and outstanding shares are validly issued, fully paid and
non-assessable.
3.03 Subsidiaries. HIGHTIDE has one subsidiary, Consortium Dimension
III.
2.04 Directors and Officers. Exhibit 3.04 to this Agreement
contains the names and titles of all officers and directors of HIGHTIDE
as of the date of this Agreement.
3.05 Absence of Changes. Since the date of HIGHTIDE's most recent
balance statements, there has not been any change in its financial condition or
operations except for changes in the ordinary course of business.
3.06 Absence of Undisclosed Liabilities. As of the date of HIGHTIDE's
most recent balance sheet to the best of its knowledge, it did not have any
material debt, liability or obligation of any nature, whether accrued, absolute,
contingent or otherwise, and whether due or to become due, that is not reflected
in such balance sheet.
3.07 Tax Returns. Within the times and in the manner prescribed by law,
HIGHTIDE to be best of its knowledge has filed all federal, state or local tax
returns required by law, has paid all taxes, assessments and penalties due and
payable and has made adequate provision on its most recent balance
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sheet for any unpaid taxes. There are no present disputes as to taxes of any
nature payable by HIGHTIDE.
3.08 Investigation of Financial Condition. Without in any manner
reducing or otherwise mitigating the representations contained herein, TOTAL and
TOTAL SHAREHOLDERS shall have the opportunity to meet with HIGHTIDE's
accountants and attorneys to discuss the financial condition of HIGHTIDE.
HIGHTIDE shall make available to TOTAL and TOTAL SHAREHOLDERS all books and
records of HIGHTIDE.
3.9 Patents, Trade Names and Rights. HIGHTIDE does not use any patents,
trade marks, service marks, trade names or copyrights in its business.
3.10 Compliance with Laws. HIGHTIDE has complied with, and is not in
violation of, applicable federal, state or local statutes, laws and regulations
affecting its properties or the operation of its business.
3.11 Litigation. HIGHTIDE is not a party to, nor to the best of its
knowledge is there pending or threatened, any suit, action, arbitration or
legal, administrative or other proceedings, or governmental investigation
concerning its business, assets or financial condition. HIGHTIDE is not in
default with respect to any order, writ, injunction or decree of any federal,
state local or foreign court or agency, nor is it engaged in, nor does it
anticipate it will be necessary to engage in, any lawsuits to recover money or
real or personal property.
3.12 Authority. The Board of Directors of HIGHTIDE has authorized the
execution of this Agreement and the transactions contemplated herein, and it has
full power and authority to execute, deliver and perform this Agreement.
3.13 Ability to Carry Out Obligations. The execution and delivery of
this Agreement by HIGHTIDE and the performance of its obligations hereunder will
not cause, constitute, conflict with or result in (i) any breach of the
provisions of any license, indenture, mortgage, charter, instrument, certificate
of incorporation, bylaw or other agreement or instrument to which it is a party
or by which it may be bound, nor will any consents or authorizations of any
party other that those hereto be required, (ii) an event that would permit any
party to any agreement or instrument to terminate it or to accelerate the
maturity of any indebtedness or other obligation, or (iii) an event that would
result in a creation or imposition of any lien, charge or encumbrance on any
asset.
3.14 Full Disclosure. None of the representations and warranties made
by HIGHTIDE herein or in any exhibit, certificate or memorandum furnished or to
be furnished by HIGHTIDE, contains or will contain any untrue statement of
material fact, or omits any material fact, the omission of which would be
misleading.
3.15 Assets. HIGHTIDE has good and marketable title to all of its
property free and clear of any and all liens, claims and encumbrances, except as
may be indicated in Exhibit 3.05
3.16 Indemnification. HIGHTIDE agrees to defend and hold TOTAL
SHAREHOLDERS and TOTAL and its officers and directors harmless against and in
respect of any and all claims, demands, losses, costs, expenses, obligations,
liabilities or damages, including interest, penalties and reasonable attorney's
fees, that it shall incur or suffer, which arise out of, result from or relate
to any
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breach of this Agreement or failure by HIGHTIDE to perform with respect to any
of its representations, warranties or covenants contained in this Agreement or
in any exhibit or other instrument furnished or to be furnished under this
Agreement.
3.17 Validity of HIGHTIDE Shares. The shares of HIGHTIDE $.001 par
value common stock to be issued pursuant to this Agreement will be duly
authorized, validly issued, fully paid and non-assessable under Nevada law.
ARTICLE IV
ACTIONS PRIOR TO CLOSING
4.01 Investigative Rights. Prior to the Closing Date each party shall
provide to the other parties, including the parties' counsel, accountants and
other authorized representatives, full access during normal business hours (upon
reasonable advance written notice) to such parties' books and records.
4.02 Conduct of Business. Prior to the Closing Date, each party shall
conduct its business in the normal course and shall not see, pledge or assign
any assets, without the prior written approval of the other parties. No party
shall amend its certificate of incorporation or bylaws, declare dividends,
redeem or sell stock or other securities, incur additional liabilities, acquire
or dispose of fixed assets, change employment terms, enter into any material or
long-term contract, guarantee obligations of any third party, settle or
discharge any balance sheet receivable for less that its stated amount, pay more
on any liability that its stated amount or enter into any other transaction
other than in the regular course of business.
ARTICLE V
CLOSING
5.01 Closing. The closing (the "Closing") of this transaction shall be
held at the offices of HIGHTIDE, or such other place as shall be mutually agreed
upon, on or before December 14th, 1999.
(the "Closing Date"):
(a) HIGHTIDE shall issue 10,000,000 shares of its $.001 par value post
reverse split common stock in a certificate or certificates representing such
shares.
(b) TOTAL SHAREHOLDERS shall deliver the certificates representing 100%
of the shares of TOTAL common stock.
(c) HIGHTIDE shall deliver a signed consent or minutes of its Board of
Directors, approving this Agreement and authorizing the matters set forth
herein;
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(d) TOTAL shall deliver a signed consent or minutes of its Board of
Directors approving this Agreement and authorizing the matters set forth herein;
ARTICLE VI
MISCELLANEOUS
6.01 Captions and Headings. The article and paragraph headings
throughout this Agreement are for convenience and reference only and shall not
be deemed to define, limit or add to the meaning of any provision of this
Agreement.
6.02 No Oral Change. This Agreement may not be changed or modified
except in writing signed by the party against whom enforcement of any change or
modification is sought.
6.03 Non-Waiver. Except as otherwise expressly provided herein, no
waiver of a covenant, condition or provision of this Agreement shall be deemed
to have been made unless executed in writing and signed by the party against
whom such waiver is charged. The failure of any party to insist in any one or
more cases upon the performance of any covenant, condition or provision of this
Agreement shall not be construed as a waiver or relinquishment for the future of
any such covenant, condition or provision. No waiver by any party of one breach
by the other shall be construed as a waiver with respect to a subsequent breach.
6.04 Time of Essence. Time is of the essence of this Agreement and of
each and every provision hereof.
6.05 Entire Agreement. This Agreement contains the entire agreement and
understanding between the parties and supersedes all prior agreements and
understandings.
6.06 Choice of Law/Arbitration. This Agreement and its application,
shall be governed under the laws of the State of Nevada. Any and all disputes
and controversies of every kind and nature between the parties hereto arising
out of or relating to this Agreement relating to the existence, construction,
validity, interpretation or meaning, performance, non-performance, enforcement,
operation, breach, continuance or termination thereof shall be subject to an
arbitration mutually agreeable to the parties or, in the absence of such mutual
agreement, then subject to arbitration in accordance with the rules of the
American Arbitration Association. It is the intent of the parties hereto and the
purpose of this provision to make the submission to arbitration of any dispute
or controversy arising hereunder an express condition precedent to any legal or
equitable action or proceeding of any nature whatsoever.
6.07 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one and the same instrument.
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6.08 Notices. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed to have been given
on the date of service if served personally on the party to whom notice is to be
given, or on the third day after mailing if mailed to the party to whom notice
is to be given, by first class mail, registered or certified, postage prepaid,
and properly addressed as follows:
HIGHTIDE:
1800 East Sahara #107
Las Vegas Nevada 89104-3732
TOTAL and TOTAL SHAREHOLDERS:
2500 Daniel-Johnson Blvd., # 1108
Laval, Qc H7T 2P6
6.09 Expenses. The parties will pay their own legal, accounting and
other expenses incurred in connection with this Agreement.
6.10 Survival of Representations and Warranties. The representations,
warranties and covenants set forth in this Agreement or in any instrument,
certificate, opinion or other writing provided for in it, shall survive the
Closing Date.
6.11 Further Documents. The parties agree to execute any and all other
documents and to take such other action or corporate proceedings as may be
necessary or desirable to carry out the terms hereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement the date
first above written.
Hightide Inc.
------------------------
President
Total Medical Inc.
------------------------
Michel Dallaire, President
Shareholders of Total Medical Inc.
-------------------------
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E X H I B I T
1.04 Directors and Officers. (TOTAL)
Michel Dallaire
3.04 Directors and Officers. (HIGHTIDE)
Michel Dallaire, President and Director
Antonio Care, Secretary-Treasurer and Director
Michael Curtis, Director
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1
EXHIBIT B
TOTAL MEDICAL INC.
S U M M A R Y
AUDITORS' REPORT 2
FINANCIAL STATEMENTS
Income statement 3
Deficit statement 4
Balance sheet 5
Cash flows statement 6
Notes to financial statements 7 to 9
<PAGE>
2
Forcier, Beaudry, Landry
1325 Boul. Lemire
Drummondville, Quebec Canada
J2C 7X9
(819) 477-1234
AUDITORS' REPORT
To the shareholders of Total Medical inc.
We have audited the balance sheet of Total Medical Inc. as at May 31, 1999 and
the statements of income, deficit and cash flows for the year then ended. This
financial statement is the responsibility of the company's management. Our
responsibility is to express an opinion on this financial statement based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform an audit to obtain reasonable
assurance whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statements presentation.
In our opinion, this financial statement presents fairly, in all material
respects, the financial position of the company as at May 31, 1999 and the
results of its operations and its cash flows for the year then ended in
accordance with generally accepted accounting principles.
Chartered Accountants
Drummondville, July 19, 1999.
<PAGE>
3
TOTAL MEDICAL INC.
INCOME STATEMENT
year ended May 31
<TABLE>
<CAPTION>
1999 1998
------------- -----------
REVENUES
<S> <C> <C>
Consultations $ 31,000 $ -
Interest 2,730 1,933
------------- -----------
33,730 1,933
ADMINISTRATIVE EXPENSES
Salaries 23,066 -
Rent 14,013 5,551
Professional fees 13,287 2,636
Travel expenses - 310
Entertainment expenses 9,754 4,235
Telephone 1,628 1,008
Taxes and permits 2,566 284
Association expenses 1,797 425
Office expenses 3,453 2,118
Interest and bank charges 628 109
------------- -----------
70,192 16,676
------------- -----------
NET LOSS $ (36,462) $ (14,743)
============= ===========
</TABLE>
<PAGE>
4
TOTAL MEDICAL INC.
DEFICIT STATEMENT
year ended May 31
<TABLE>
<CAPTION>
1999 1998
------------- -----------
<S> <C> <C>
BALANCE AT BEGINNING OF YEAR $ (14,743) $ -
Net loss (36,462) (14,743)
------------- -----------
BALANCE AT END OF YEAR $ (51,205) $ (14,743)
============= ===========
</TABLE>
<PAGE>
5
TOTAL MEDICAL INC.
BALANCE SHEET
as at May 31
<TABLE>
<CAPTION>
1999 1998
------------- -----------
ASSETS
SHORT-TERM ASSETS
<S> <C> <C>
Cash $ 47,952 $ 59,645
Receivables (note 3) 13,690 9,341
Prepaid expenses 605 2,367
------------- -----------
62,247 71,353
INVESTMENT, at cost (note 4) 50,000 -
FIXED ASSETS (note 5) 3,524 2,757
START-UP COSTS, unamortized cost 442,261 217,997
------------- -----------
$ 558,032 $ 292,107
============= ===========
LIABILITIES
SHORT-TERM LIABILITIES
Payables $ 2,387 $ -
------------- -----------
SHAREHOLDERS' EQUITY
Share capital (note 6) 606,850 306,850
Deficit (51,205) (14,743)
------------- -----------
555,645 292,107
------------- -----------
$ 558,032 $ 292,107
============= ===========
</TABLE>
COMMITMENT (note 10)
CONTINGENCY (note 11)
FOR THE BOARD OF DIRECTORS
__________________________________, Director
__________________________________, Director
<PAGE>
6
TOTAL MEDICAL INC.
CASH FLOWS STATEMENT
year ended May 31
<TABLE>
<CAPTION>
1999 1998
------------- -----------
OPERATING ACTIVITIES
<S> <C> <C>
Net loss $ (36,462) $ (14,743)
Net changes in non-cash working capital
Receivables (4,349) (9,341)
Prepaid expenses 1,762 (2,367)
Payables 2,387 -
------------- -----------
Cash used in operating activities (36,662) (26,451)
FINANCING ACTIVITIES
Issue of shares 300,000 306,850
------------- -----------
Cash provided from financing activities 300,000 306,850
INVESTING ACTIVITIES
Acquisition of an investment (50,000) -
Acquisition of fixed assets (767) (2,757)
Acquisition of start-up costs (224,264) (217,997)
------------- -----------
Cash used in investing activities (275,031) (220,754)
------------- -----------
CASH (note 8)
Increase (decrease) in cash during year (11,693) 59,645
Balance at beginning 59,645 -
------------- -----------
Balance at end $ 47,952 $ 59,645
============= ===========
</TABLE>
<PAGE>
7
TOTAL MEDICAL INC.
NOTES TO FINANCIAL STATEMENTS
year ended May 31, 1999
1. ARTICLES OF INCORPORATION AND DESCRIPTION OF ACTIVITIES
The Company is incorporated federally under the Canada Business Corporations Act
and operates a business in the medical field.
2. SIGNIFICANT ACCOUNTING POLICY
Amortization
The computer equipment is recorded at cost and will be amortized using the
declining-balance method at an annual rate of 30%. No amortization has been
accounted for since the incorporation of the Company. The start-up costs will be
amortized using the straight-line method over a period of 10 years starting in
the fiscal period in which the business earns revenues in the medical field.
3. RECEIVABLES
1999 1998
---------- ----------
Accounts receivable $ 3,756 $ -
Sales taxes 9,934 9,341
---------- ----------
$ 13,690 $ 9,341
========== ==========
4. INVESTMENT, at cost
50,000 class "A" shares (50%)
of Gestion MedicAction inc. $ 50,000 $ -
========== ==========
5. FIXED ASSETS
Accumulated Net value
Cost depreciation 1999 1998
--------- ------------ -------- --------
Computer equipment $ 3,524 $ - $ 3,524 $ 2,757
========= ============ ======== ========
<PAGE>
8
TOTAL MEDICAL INC.
NOTES TO FINANCIAL STATEMENTS
year ended May 31, 1999
6. SHARE CAPITAL
Authorized
An unlimited number, without par value
Class "A" shares, voting, participating
1999 1998
----------- -----------
Issued and paid
34,470,666 class "A" shares (28,470,666 in 1998) $ 606,850 $ 306,850
=========== ===========
During the period, the Company issued 6,000,000 class "A" shares in
consideration for $ 300,000 in cash.
7. OPERATIONS BETWEEN RELATED PARTIES
The Company is renting premises from a related company. Rent of $ 14,013 ($
1,800 in 1998) was paid to this company during the period.
8. CASH POSITION
The cash position consists of cash.
9. UNREALIZED TAX BENEFIT
The losses carried forward for tax purposes and the unaccounted for tax benefit
which may result are as follows :
Last year of Amount of Unrealized tax
carry forward loss benefit
2005 $ 229,122 $ 43,601
2006 $ 255,849 $ 48,688
10. COMMITMENT
The company is renting premises under a lease expiring on May 10,2000. Minimum
future rents total $ 14,493.
<PAGE>
9
TOTAL MEDICAL INC.
NOTES TO FINANCIAL STATEMENTS
year ended May 31, 1999
11. CONTINGENCY
With the arrival of the year 2000 comes the computer system problem arising from
the industry's use of 2 digits instead of 4 to designate a year. The Year 2000
Problem may manifest itself on, before or after January 1, 2000. Date-sensitive
systems could confuse the year 2000 with the year 1900 or perhaps another year.
This would lead to errors when the year 2000 is entered into a system. Moreover,
similar problems could occur in systems where certain dates in 1999 represent
things other than dates. If the problem is not resolved, the consequences could
range from minor inconvenience to a complete breakdown in a company's ability to
operate normally and to utilise financial information. It is impossible to know
if all of the aspects of the Year 2000 Problem as it pertains to the company
will be resolved despite the best efforts of customers, suppliers, and other
interested parties.
<PAGE>
1
TOTAL MEDICAL INC.
S U M M A R Y
AUDITORS' REPORT 2
FINANCIAL STATEMENTS
Income and deficit statement 3
Balance sheet 4
Statement of changes in financial position 5
Notes to financial statements 6, 7
<PAGE>
2
Forcier, Beaudry, Landry
1325 Boul. Lemire
Drummondville, Quebec Canada
J2C 7X9
(819) 477-1234
AUDITORS' REPORT
To the shareholders of Total Medical inc.
We have audited the balance sheet of Total Medical Inc. as at May 31, 1998 and
the statements of income and deficit and changes in financial position for the
year then ended. This financial statement is the responsibility of the company's
management. Our responsibility is to express an opinion on this financial
statement based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform an audit to obtain reasonable
assurance whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statements presentation.
In our opinion, this financial statement presents fairly, in all material
respects, the financial position of the company as at May 31, 1998 and the
results of its operations and the changes in its financial position for the year
then ended in accordance with generally accepted accounting principles.
General Partnership
Chartered Accountants
Drummondville, August 20, 1998.
<PAGE>
3
TOTAL MEDICAL INC.
INCOME AND DEFICIT STATEMENT
year ended May 31, 1998
<TABLE>
<CAPTION>
REVENUES
<S> <C>
Interest $ 1,933
---------
ADMINISTRATIVE EXPENSES
Rent 5,551
Professional fees 2,636
Travel expenses 310
Entertainment expenses 4,235
Telephone 1,008
Taxes and permits 284
Association expenses 425
Office expenses 2,118
Interest and bank charges 109
---------
16,676
---------
NET LOSS AND DEFICIT $ (14,743)
=========
</TABLE>
<PAGE>
4
TOTAL MEDICAL INC.
BALANCE SHEET
as at May 31, 1998
<TABLE>
<CAPTION>
ASSETS
SHORT-TERM ASSETS
<S> <C>
Cash $ 59,645
Taxes receivable 9,341
Prepaid expenses 2,367
----------
71,353
FIXED ASSETS, at cost 2,757
START-UP COSTS, unamortized cost 217,997
----------
$ 292,107
==========
SHAREHOLDERS' EQUITY
Share capital (note 3) $ 306,850
Deficit (14,743)
----------
$ 292,107
==========
</TABLE>
FOR THE BOARD OF DIRECTORS
__________________________________, Director
__________________________________, Director
<PAGE>
5
TOTAL MEDICAL INC.
STATEMENT OF CHANGES IN FINANCIAL POSITION
year ended May 31, 1998
<TABLE>
<CAPTION>
OPERATING ACTIVITIES
<S> <C>
Net loss $ (14,743)
Net changes in non-cash working capital
Receivables (9,341)
Prepaid expenses (2,367)
-----------
Cash used in operating activities (26,451)
FINANCING ACTIVITIES
Issue of shares 306,850
-----------
Cash provided from financing activities 306,850
INVESTING ACTIVITIES
Acquisition of fixed assets (2,757)
Acquisition of start-up costs (217,997)
-----------
Cash used in investing activities (220,754)
CASH (note 4)
Increase in cash during year 59,645
Initial contribution -
-----------
Balance at end $ 59,645
===========
</TABLE>
<PAGE>
6
TOTAL MEDICAL INC.
NOTES TO FINANCIAL STATEMENTS
year ended May 31, 1998
1. ARTICLES OF INCORPORATION AND DESCRIPTION OF ACTIVITIES
The Company, incorporated federally on June 3, 1997 under the Canada Business
Corporations Act, operates a business in the medical field.
2. SIGNIFICANT ACCOUNTING POLICY
Amortization
The computer equipment is recorded at cost and will be amortized using the
declining-balance method at an annual rate of 30%. No amortization has been
accounted for since during the year.
The start-up costs will be amortized using the straight-line method over a
period of 10 years starting in the fiscal period in which the business earns
revenues in the medical field.
3. SHARE CAPITAL
Authorized
An unlimited number, without par value
Class "A" shares, voting, participating
Issued and paid
28,470,666 class "A" shares $ 306,850
===========
During the period, the Company issued 28,470,666 class "A" shares in
consideration for $ 306,850 in cash.
4. CASH POSITION
The cash position consists of cash.
<PAGE>
7
TOTAL MEDICAL INC.
NOTES TO FINANCIAL STATEMENTS
year ended May 31, 1998
5. UNREALIZED TAX BENEFIT
The loss carried forward for tax purposes and the unaccounted for tax benefit
which may result are as follows :
Last year of Amount of Unrealized tax
carry forward loss benefit
-------------- ----------- ---------------
2004 $ 230,622 $ 43,887
============== =========== ===============
<PAGE>
EXHIBIT C
AMENDMENTS TO THE
ARTICLES OF INCORPORATION
OF
HIGHTIDE INC.
The undersigned duly elected President and Secretary of
Hightide Inc., acting pursuant to Section 78.320 of the Nevada Revised
Statutes, do hereby adopt the following Amendments to the Articles of
Incorporation of Hightide Inc.
ARTICLE I
There are presently 10,000,000 ($.001) par value common
shares of the corporation outstanding. Those 10,000,000 common shares
are hereby reverse split one (1) share for five (5) shares, without
changing the par value thereof, so that the 10,000,000 ($.001) par
value common shares of the corporation which are presently outstanding
shall hereafter constitute 2,000,000 ($.001) par value common shares of
the corporation. Fractional shares shall be disregarded. A copy of the
text of this amendment shall be served upon the transfer agent of the
corporation with instructions to implement the same as to any shares
submitted for transfer after the effective date hereof.
II
MANNER OF ADOPTION
The foregoing amendments to the Articles of Incorporation of
the corporation were adopted by the consent of stockholders of the corporation
pursuant to Section 78.320 of the Nevada Revised Statutes on December 14, 1999.
On the date of said consent, there were 10,000,000 common shares of the
corporation outstanding and entitled to vote on such amendment. The foregoing
amendment was adopted by the written consent of the registered owners of
5,095,000 shares.
The number of votes cast in favor of these amendments
was sufficient constitute approval of the amendment by the holders of
common shares of the corporation.
<PAGE>
Dated this 14th day of December 1999.
HIGHTIDE INC.
------------------------------
Michel Dallaire, President
------------------------------
Antonio Care, Secretary
<PAGE>
IN WITNESS WHEREOF, we, Michel Dallaire, and Antonio Care have executed
these Amendments to the Articles of Incorporation in duplicate this 14th day of
December 1999 and say :
1. That we are, respectively, the duly elected president and secretary
of Hightide Inc.
2. That we have read the above and foregoing Amendments to Articles of
Incorporation; know the contents thereof and that the same are true to the best
of our knowledge and belief, excepting as to matters alleged on information and
belief and as to those matters, we believe them to be true.
------------------------------------
Michel Dallaire
------------------------------------
Antonio Care
Subscribed and sworn to before me this ______________________________.
------------------------------------
Notary Public
