8-K 1 ts8k.txt TRADING SOLUTIONS 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act August 28, 2001 Date of Report August 16, 2001 (Date of Earliest Event Reported) TRADING SOLUTIONS.COM, INC. (Exact Name of Registrant as Specified in its Charter) Nevada 333-85787 88-0425691 (State or other (Commission File No.) (IRS Employer I.D. No.) Jurisdiction) 2 Rodeo Court, Toronto, Ontario Canada M2M 4M3 (Address of Principal Executive Offices) 416-512-2356 Registrant's Telephone Number (Former Name or Former Address if changed Since Last Report) Item 1. Changes in Control of Registrant. Pursuant to an Exchange Agreement dated August 18, 2001 between the Company and Springland Beverages, Inc., 15,542,500 shares of the Company were exchanged for all of the issued and outstanding shares of Springland Beverages, Inc. making Springland Beverages, Inc. a wholly owned subsidiary of the Company. This transaction created a change in control of the Company. Mr. Ralph Moyal received 15,000,000 of the exchanged shares placing him in a position of owning 81.5% of the Company. Also, pursuant to the Exchange Agreement, Mr. Moyal will become a director of the Company and the current officers and directors will resign. In addition to the shares issued, 602,772 warrants were issued to the shareholders of Springland Beverages, Inc. to purchase an equal number of the Company's shares. The warrants expire September 16, 2001. Item 2. Acquisition or Disposition of Assets. Pursuant to an Exchange Agreement dated August 18, 2001 between the Company and Springland Beverages, Inc., 15,542,500 shares of the Company were exchanged for all of the issued and outstanding shares of Springland Beverages, Inc. making Springland Beverages, Inc. a wholly owned subsidiary of the Company. The shares were issued to the seven original shareholders of Springland Beverages, Inc. In addition to the shares issued, 602,772 warrants were issued to the shareholders of Springland Beverages, Inc. to purchase an equal number of the Company's shares. The warrants expire September 16, 2001. The Company will pursue the bottled water and related beverage market through Springland Beverages, Inc. The Company's new address is 2 Rodeo Court, Toronto, Ontario Canada M2M 4M3, telephone 416-512-2356. The email address rmoyal@idirect.com. Business of the Company The Company will operate through its wholly owned subsidiary, Springland Beverages, Inc., an Ontario corporation. Springland intends to supply natural spring water and water related beverages, initially in the U.S. market but eventually as a global operation. Springland has secured an option to purchase land on which an existing certified and approved source of natural spring water exists. Additionally, the Company has registered the trademarks "Springland" and "Aurora" in both the United States and Canada. The Company is in the process of negotiating the purchase of an operating beverage plant. The Company intends to identify operating beverage and beverage related companies for future acquisitions. Natural spring water is defined by the U. S. Food and Drug Administration as "bottled water derived from an underground formation from which water flows naturally to the surface of the earth." Springland's potential source of water meets this definition as evidenced by studies conducted on the lands including a reporting letter from the Ontario Ministry of the Environment. The water source the is under the option held by Springland is located on approximately 62 acres with two major spings. The Ontario Ministry of the Environment has 2 issued permits allowing for 150,000 imperial gallons per day for 300 days on an annual basis. The permits were originally issued in 1984 and subsequently renewed in 1993 until the year 2003. In the realm of nonalcoholic drinks, consumers spend more money on carbonated soft drinks than anything else. The sector is dominated by three major competitors that together control nearly 80% of the global market. Coca-Cola controls approximately 50% of the market, followed by Pepsi at about 21% and Cadbury Schweppes at 7%. For many years the nonalcoholic sector has engaged in a power struggle between the Cola War principals, Coke and Pepsi. The industry giants have begun looking to the non-carbonated beverage sector and relying on new product introduction for growth. World wide consumption of natural spring water is a $35 billion market. In the U.S. water sales rose 13.9% in 1999 to $5.2 billion according to Beverage Marketing Corporation. The bottled water market is divided into two distinct categories: non- carbonated which accounts for approximately 91% of bottled water sales and carbonated which accounts for approximately 9% of bottled water sales. Bottled water continues to have increased sales. In 2000, the segment rose some 28%. Sales volume rose 8.3% to 5 billion gallons, twice what it was in 1992. Wholesale dollars increased 9.3%. Currently, per capita consumption of bottled water is at an all time high of 18.2 gallons. Following the acquisition of an operating plant, the Company plans to initiate an aggressive marketing campaign to establish the Springland name. The Company will strive for corporate brand identification by increasing exposure within the water and water related industry. The Company intends to develop sales literature, demonstration materials and direct response promotions. In addition, the Company intends to use direct mail, fax and telemarketing campaigns for sales generation. The Company recognizes that advertising and promotion must be done aggressively in order to accomplish sales goals. Along with ad campaigns, the Company will release key press releases and reports to appropriate journals and market specific trade shows. Trade show marketing may include informational brochures and giveaways. Facilities Until such time as the Company complete a plant acquisition, the President of the Company, Ralph Moyal is providing office space at no cost to the Company. The address is 2 Rodeo Court, Toronto, Ontario Canada M2M 4M3, telephone 416-512-2356. Management Effective September 7, 2001, Mr. Ralph Moyal will be the sole officer and director. Mr. Moyal was the Chief Executive and then later was the Chairman of Blue Mountain Beverages and founder of Distribution Canada, Inc. In 1995 he retired as the President of Blue Mountain Beverages and has been self employed since that time. He has over 30 years in the food and beverage industry and was selected two years consecutively as Ontario's Top 100 Entrepreneurs by the Ontario Business Journal. 3 Until such time as the Company begins operations and generates revenue, Mr. Moyal will not receive any salary or compensation other than reimbursement for expenses on behalf of the Company. Item 4. Changes in Registrant's Certifying Accountant The Company's independent auditor for the years ended March 30, 2000 and 2001 was Richard Hawkins of Hawkins Accounting. In August 2001, the Company terminated the engagement of Hawkins Accounting as its independent auditor to lower expenses and provide an auditor located closer to the Company. The Board of Directors researched and approved the accounting firm of Freedman & Goldberg to serve as independent auditor of the Company for the year ended September 30, 2001 and any interim periods. The Company has been advised that neither Freedman & Goldberg nor any of their members or associates has any relationship with the Company or any of its affiliates, except in the firm's proposed capacity as the Company's independent auditor. During the fiscal years ended March 30, 2000 and 2001, and any subsequent interim periods, the financial statements of the Company did not contain any adverse opinion or disclaimer of opinion from the Company's former independent auditor, and were not modified as to uncertainty, audit scope, or accounting principles, except the reports issued by Hawkins Accounting contained a statement expressing doubt about the ability of the Company to continue as a going concern due to its status as a development stage company with no significant operating results. During the year ended March 30, 2000, and from that date to the present, there were no disagreements with the former independent auditor on any matter of accounting principles, financial statement disclosure, or auditing scope or procedure which, if not resolved to the former independent auditor's satisfaction, would have caused it to make reference to the subject matter of the disagreement in connection with its audit report. Item 7. Financial Statements and Exhibits. (a) Financial Statements of Businesses Acquired. Interim Financial Statements as of June 30, 2001 (unaudited) To be filed within 60 days Interim Financial Statements as of March 31, 2001 (unaudited) Notice to Reader Interim Balance Sheet as of March 31, 2001 Interim Statement of Deficit for the Period October 1, 2000 to March 31, 2001 Interim Statement of Loss for the Period October 1, 2000 to March 31, 2001 Notes to Interim Financial Statements 4 Audited Financial Statements as of September 30, 2000 Auditors Report Balance Sheet as of September 30, 2000 Statement of Deficit for the Year Ended September 30, 2000 Statement of Loss for the Year Ended September 30, 2000 Statement of Cash Flows for the Year Ended September 30, 2000 Notes to Financial Statements Audited Financial Statements as of September 30, 1999 Auditors Report Balance Sheet as of September 30, 1999 Statement of Deficit for the Year Ended September 30, 1999 Statement of Loss for the Year Ended September 30, 1999 Statement of Cash Flows for the Year Ended September 30, 1999 Notes to Financial Statements (b) Pro Forma Financial Information. To be filed within 60 days. (c) Exhibits. Exhibit SEC Description of Exhibit Number Reference 1 2 Exchange Agreement 3 16 Letter on Change in Certifying Accountant Item 8. Change in Fiscal Year. On August 28, 2001, the Board of Directors determined it is in the Company's best interest to change its fiscal year to be the same as its wholly owned subsidiary. Therefore, the Company will change its fiscal year from March 31 to September 30. The Form 10-KSB for the period ending September 30, 2001 will cover the transition period. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. Date: August 31, 2001 TRADING SOLUTIONS.COM, INC. By:/s/ Ralph Moyal Ralph Moyal, President 5 GOLDBAND Philip Goldband, B. Comm., C.A., CFP & Jeff Goldberg, B.B.A., M.B.A., C.A. GOLDBERG, LLP Leon Elmaleh, B.B.A., C.A. David Levine, BSc., B. Comm., C.A., Principal CHARTERED 15 Coldwater Road Toranto, Ontario M3B 1Y8 ACCOUNTANTS Tel.(416)441-9292 Fax.(416)441-2766 Website: www.ggca.com NOTICE TO READER We have compiled the interim balance sheet of Springland Beverages Inc. as at March 31, 2001 and the interim statements of loss and deficit for the period October 1, 2000 to March 31, 2001 from information provided by management. We have not audited, reviewed or otherwise attempted to verify the accuracy or completeness of such information. Readers are cautioned that these statements may not be appropriate for their purpose. /s/ Goldband & Goldberg, LLP TORONTO, June 13, 2001 CHARTERED ACCOUNTANTS Represented in the United States by a member firm of L A. L. P A. 6 SPRINGLAND BEVERAGES IN INTERIM BALANCE SHEET MARCH 31, 2001 (Unaudited - See Notice to Reader) ASSETS March 31 September 30 2001 2000 (6 Months) (12 months) Current Bank $ 3,400 $ 6,430 Deposit on land 75,000 75,000 Prepaid and sundry assets 2,492 1,946 80,892 83,376 Other (Note 1) 26,838 24,406 $ 107,730 $ 107,782 LIABILITIES Current Accounts payable and accrued liabilities $ 13,706 $ 8,820 Advances from director 20,965 16,525 34,671 25,345 SHAREHOLDERS' EQUITY Capital Stock (Note 2) 110,001 110,001 Deficit (36,942) (27,564) 73,059 82,437 $ 107,730 $ 107,782 7 SPRINGLAND BEVERAGES IN. INTERIM STATEMENT OF DEFICIT FOR THE PERIOD OCTOBER 1, 2000 TO MARCH 31, 2001 (Unaudited - See Notice to Reader) March 31 September 30 2001 2000 (6 Months) (12 months) Deficit, beginning of period $ 27,564 $ 5,684 Net loss 9,378 21,880 Deficit, end of period $ 36,942 $ 27,564 8 SPRINGLAND BEVERAGES INC. INTERIM STATEMENT OF LOSS FOR THE PERIOD OCTOBER 1, 2000 TO MARCH 31, 2001 (Unaudited - See Notice to Reader) March 31 September 30 2001 2000 (6 Months) (12 months) REVENUE $ - $ - EXPENSES Advertising and promotion 734 2,229 Amortization 558 634 Office and general 1,545 2,402 Professional fees 3,160 10,069 Rent 1,500 3,000 Telephone 734 1,784 Travel 1,147 1,762 9,378 21,880 NET LOSS $(9,378) $(21,880) 9 SPRINGLAND BEVERAGES INC. NOTES TO INTERIM FINANCIAL STATEMENTS MARCH 31, 2001 1. OTHER March 31 September 30 Accumulated 2001 2000 Cost Amortization Net Net Trademark $ 11,978 $ 677 $ 11,301 $ 8,460 Deferred legal costs 16,355 818 5,537 15,946 $ 28,333 $ 1,495 $ 26,838 $ 24,406 2. CAPITAL STOCK Authorized Unlimited Common shares Unlimited Preference shares Issued 550,001 Common shares for consideration of 110,001. 10 GOLDBAND Philip Goldband, B.Comm., C.A., CFP & Jeff Goldberg, B.B.A., M.B.A., C.A. GOLDBERG, LLP Leon Elmaleh, B.B.A., C.A. David Levine, BSc., B. Comm., C.A., Principal CHARTERED 15 Coldwater Road Toranto, Ontario M3B 1Y8 ACCOUNTANTS Tel.(416)441-9292 Fax.(416)441-2766 Website: www.ggca.com To the Shareholders of Springland Beverages Inc. AUDITORS'REPORT We have audited the balance sheet of Springland Beverages Inc. as at September 30, 2000 and the statements of loss, deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our 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 statement presentation. In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at September 30, 2000 and the results of its operations and its cash flows for the year then ended in accordance with generally accepted accounting principles. TORONTO, April 12,2001 CHARTERED ACCOUNTANTS Represented in the United States by a member firm of I.A.L.P.A. 11 SPRINGLAND BEVERAGES INC. BALANCE SHEET SEPTEMBER 30,2000 ASSETS 2000 1999 Current Bank $ 6,430 $ 650 Deposit on land 75,000 - Prepaid and sundry assets 1,946 - 83,376 650 Other (Note 3) 24,406 6,113 $ 107,782 $ 6,763 LIABILITIES Current Accounts payable and accrued liabilities $ 8,820 $ 6,243 Advances from shareholder (Note 4) 16,525 6,203 25,345 12,446 SHAREHOLDERS' EQUITY Capital Stock (Note 5) 110,001 1 Deficit (27,564) (5,684) 82,437 (5,683) $ 107,782 $ 6,763 APPROVED ON BEHALF OF THE BOARD: _____________________________________ Director _____________________________________ Director 12 SPRINGLAND BEVERAGES INC. STATEMENT OF DEFICIT FOR THE YEAR ENDED SEPTEMBER 30,2000 2000 1999 Deficit, beginning of year $ 5,684 $ 4,178 Net loss 21,880 1,506 Deficit, end of year $ 27,564 $ 5,684 13 SPRINGLAND BEVERAGES INC. STATEMENT OF LOSS FOR THE YEAR ENDED SEPTEMBER 30,2000 2000 1999 REVENUE $ - $ - EXPENSES Advertising and promotion 2,229 - Amortization 634 161 Office and general 2,402 - Professional fees 10,069 1,345 Rent 3,000 - Telephone 1,784 - Travel 1,762 - 21,880 1,506 NET LOSS $(21,880) $ (1,506) 14 SPRINGLAND BEVERAGES INC. STATEMENT OF CASH FLOWS FOR THE YEAR ENDED SEPTEMBER 30,2000 2000 1999 NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES OPERATING Cash from operations Net loss $ (21,880) $ (1,506) Charges to earnings not involving cash: Amortization 634 161 (21,246) (1,345) Net change in non-cash working capital balances related to operations (Note 6) (64,413) 3,376 (85,659) 2,031 FINANCING Issuance of common shares 110,000 - INVESTING Increase in other assets (18,928) (2,639) CHANGE IN CASH DURING THE YEAR 5,413 (608) CASH, beginning of year 650 1,258 CASH, end of year $ 6,063 $ 650 15 SPRINGLAND BEVERAGES INC. NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30,2000 1. FINANCIAL STATEMENTS The company was incorporated under the laws of the Province of Ontario on February 19, 1997. 2. SIGNIFICANT ACCOUNTING POLICIES Intangibles - Trademarks The trademark "SPRINGLAND" was registered in July 1999. Trademark costs are being amortized on a straight-line basis over 40 years. Intangibles - Deferred Legal Costs Deferred legal costs represent legal fees incurred to date in order to accomplish a potential Initial Public Offering (IPO). These fees are being amortized on a straight-line basis over 20 years. Foreign Currency Translation Monetary assets and liabilities are translated into Canadian dollars at year end exchange rates. Revenue and expense items are translated at average rates of exchange during the period. Resulting exchange gains or losses are included in earnings. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. 3. OTHER Accumulated 2000 1999 Cost Amortization Net Net Trademark $ 8,987 $ 527 $ 8,460 $ 6,113 Deferred legal costs 16,355 409 15,946 - $ 25,342 $ 936 $ 24,406 $ 6,113 16 SPRINGLAND BEVERAGES INC. NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30,2000 4. ADVANCES FROM SHAREHOLDER Advances from the controlling shareholder of the company are non- interest bearing, due on demand and are unsecured. 5. CAPITAL STOCK Authorized Unlimited Common shares Unlimited Preference shares Issued 550,001 Common shares for consideration of $ 110,00 1. During the year the company issued 550,000 common shares and 611,110 warrants out of treasury for $ 110,000. Each warrant entitles the holder to purchase an additional common share for 50 cents for a period of 2 years following the expiration of any statutory holding period. 6. NET CHANGE IN NON-CASH WORKING CAPITAL 2000 1999 Deposit on land $ (75,000) $ - Prepaid and sundry assets (1,946) - Accounts payable and accrued liabilities 2,577 2,751 Advances from shareholder 9,956 625 $ (64,413) $ 3,376 7. FINANCIAL INSTRUMENTS The company's short-term financial instruments comprising cash, deposit on land, prepaid and sundry assets, accounts payable and accrued liabilities and advances from shareholder are carried at cost, which, due to their short term nature, approximates their fair value. 17 GOLDBAND Philip Goldband, B. Comm., C.A., CFP & Jeff Goldberg, B.B.A., M.B.A., C.A. GOLDBERG LLP Leon Elmaleh, B.B. A.,C.A. CHARTERED 15 Coldwater Road Toronto, Ontario M3B 1Y8 ACCOUNTANTS Tel.(416)441-9292 Fax(416)441-2766 Website: www.ggca To the Shareholder of Springland Beverages Inc. AUDITORS'REPORT We have audited the balance sheet of Springland Beverages Inc. as at September 30, 1999 and the statements of loss, deficit and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our 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 statement presentation. In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at September 30, 1999 and the results of its operations and its cash flows for the year then ended in accordance with generally accepted accounting principles. DON MILLS, November 16,1999 CHARTERED ACCOUNTANTS 18 SPRINGLAND BEVERAGES INC. BALANCE SHEET SEPTEMBER 30,1999 ASSETS 1999 1998 Current Bank $ 650 $ 1,258 Other (Note 3) 6,113 3,635 $ 6,763 $ 3,493 LIABILITIES Current Accounts payable and accrued liabilities $ 6,244 $ 3,493 Advances from shareholder (Note 4) 6,202 5,577 12,446 9,070 SHAREHOLDER'S DEFICIENCY Capital Stock (Note 5) 1 1 Deficit (5,684) (4,178) (5,683) (4,177) $ 6,763 $ 4,893 APPROVED ON BEHALF OF THE BOARD: ______________________________________ Director ______________________________________ Director 19 SPRINGLAND BEVERAGES INC. STATEMENT OF DEFICIT FOR THE YEAR ENDED SEPTEMBER 30,1999 1999 1998 Deficit, beginning of year $ 4,178 $ 2,425 Net loss 1,506 1,753 Deficit, end of year $ 5,684 $ 4,178 20 SPRINGLAND BEVERAGES INC. STATEMENT OF LOSS FOR THE YEAR ENDED SEPTEMBER 30,1999 1999 1998 REVENUE $ - $ - EXPENSES Amortization 161 95 Interest and bank charges 145 120 Office and general - 338 Professional fees 1,200 1,200 1,506 1,753 NET LOSS $ 1,506 $ 1,753 21 SPRINGLAND BEVERAGES INC. STATEMENT OF CASH FLOWS FOR THE YEAR ENDED SEPTEMBER 30,1999 1999 1998 NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES OPERATING Cash from operations Net loss $ (1,506) $ (1,753) Charges to earnings not involving cash: Amortization 161 95 (1,345) (1,658) Net change in non-cash working capital balances related to operations (Note 6) 3,376 2,481 2,031 823 INVESTING Increase in other assets (2,639) (812) CHANGE IN CASH DURING THE YEAR (608) 11 CASH, beginning of year 1,258 1,247 CASH, end of year $ 650 $ 1,258 22 SPRINGLAND BEVERAGES INC. NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30,1999 1. FINANCIAL STATEMENTS The company was incorporated under the laws of the Province of Ontario on February 19, 1997. 2. SIGNIFICANT ACCOUNTING POLICIES Intangibles The trademark "SPRINGLAND" was registered in July 1999. Trademark costs are being amortized on a straight-line basis over 40 years. 3. OTHER Accumulated 1999 1998 Cost Amortization Net Net Trademark $ 6,414 $ 301 $ 6,113 $ 3,635 4. ADVANCES FROM SHAREHOLDER Advances from the shareholder of the company are non-interest bearing, due on demand and are unsecured. 5. CAPITAL STOCK Authorized Unlimited Common shares Unlimited Preference shares Issued 15,000,000 Common shares for consideration of $ 1. 23 SPRINGLAND BEVERAGES INC. NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30,1999 6. NET CHANGE IN NON-CASH WORKING CAPITAL 1999 1998 Accounts payable and accrued liabilities $ 2,751 $ 830 Advances from shareholder 625 1,651 $ 3,376 $ 2,481 7. SUBSEQUENT EVENTS Subsequent to the year end, the Company issued 550,000 common shares and 611,110 warrants out of treasury for $ 110,000. Each warrant entitles the holder to purchase an additional common share for 50 cents for a period of 2 years following the expiration of any statutory holding period. 8. YEAR 2000 READINESS The Year 2000 Issue arises because many computerized systems use two digits rather than four to identify a year. Data-sensitive systems may recognize the year 2000 as 1900 or some other date, resulting in errors when information using year 2000 dates is processed. In addition, similar problems may arise in some systems which use certain dates in 1999 to represent something other than a date. The effects of the Year 2000 Issue may be experienced before, on or after January 1, 2000, and, if not addressed, the impact on operations and financial reporting may range from minor issues to significant systems failure which could affect an entity's ability to conduct normal business operations. It is not possible to be certain that all aspects of the Year 2000 Issue affecting the entity, including those related to the efforts of affiliates, suppliers, or other third parties will be fully resolved. The Company, however has evaluated their systems and feel that they will be compatible with the Year 2000. 24