-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MAK9udruFc3wpnEqWx0J3rC56n4szJdKQe4hlDLeIsJGKlFbHiM1nIwDzvxC/q7t Z0DKOS9lYb/Vp+RMeSEmMQ== 0001140377-06-000179.txt : 20060725 0001140377-06-000179.hdr.sgml : 20060725 20060725172519 ACCESSION NUMBER: 0001140377-06-000179 CONFORMED SUBMISSION TYPE: 10KSB/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20051231 FILED AS OF DATE: 20060725 DATE AS OF CHANGE: 20060725 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TREE TOP INDUSTRIES, INC. CENTRAL INDEX KEY: 0000356590 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 830250943 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10KSB/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-10210 FILM NUMBER: 06979892 BUSINESS ADDRESS: STREET 1: 666 FIFTH AVENUE-SUITE 302 CITY: NEW YORK STATE: NY ZIP: 10103 BUSINESS PHONE: 2125544111 MAIL ADDRESS: STREET 1: 666 FIFTH AVENUE-SUITE 302 CITY: NEW YORK STATE: NY ZIP: 10103 FORMER COMPANY: FORMER CONFORMED NAME: GOHEALTH MD INC DATE OF NAME CHANGE: 20000201 FORMER COMPANY: FORMER CONFORMED NAME: NUGGET EXPLORATION INC DATE OF NAME CHANGE: 19920703 10KSB/A 1 treetop_10ksba2mk.txt FORM 10KSB/A-2 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-KSB/Amendment No. 2 (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 2005 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED) Commission File Number: 001-10382 TREE TOP INDUSTRIES, INC. (Exact name of registrant as specified in its charter) GOHEALTH.MD, INC. (Former name of small business issuer) Nevada 83-0250943 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 666 Fifth Avenue, Suite 300 New York, NY 10103 (Address of principal executive offices and Zip Code) (775) 261-3728 Registrant's telephone number including area code Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 par value (Title of class) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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. Yes [x] No [ ] Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or an amendment to this Form 10-KSB. [x] Issuer's revenues for its most recent fiscal year were $-0-. The aggregate market value of voting stock held by non-affiliates of the small business issuer, computed by reference to the price at which the common stock was sold, or the average bid and asked price of the common stock on April 12, 2006 was $4,691,841. At April 12, 2006, there were 252,791 shares of the Registrant's common stock outstanding, and Company had 643 shareholders of record. This is a function of a previously Board approved reverse split, although not yet effective. CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION The discussion contained in this 10-KSB under the Securities Exchange Act of 1934, as amended, (the "Exchange Act") contains forward-looking statements that involve risks and uncertainties The issuer's actual results could differ significantly from those discussed herein. These include statements about our expectations, beliefs, intentions or strategies for the future, which we indicate by words or phrases such as "anticipate," "expect," "intend," "plan," "will," "we believe," "the Company believes," "management believes" and similar language, including those set forth in the discussion under "Description of Business," including the "Risk Factors" described in that section, and "Management's Discussion and Analysis or Plan of Operation" as well as those discussed elsewhere in this Form 10-KSB. We base our forward-looking statements on information currently available to us, and we assume no obligation to update them. Statements contained in this Form 10-KSB that are not historical facts are forward-looking statements that are subject to the "safe harbor" created by the Private Securities Litigation Reform Act of 1995. PART I ITEM 1. DESCRIPTION OF BUSINESS Background On July 24, 1980, Western Exploration and Mining Company was incorporated under the laws of the state of Nevada. On February 5, 1981, the name was changed to Nugget Exploration, Inc. This entity had a wholly owned subsidiary, Nugget Holding Co. On February 23, 1999, Tree Top Industries, Inc. (fka GoHealth.MD, Inc.) ("Tree Top"), was incorporated under the laws of the State of Delaware. On November 10, 1999, Nugget Holding Company merged into Tree Top (fka GoHealth) (the "Merger"). As a result of the Merger, Tree Top (fka GoHealth) became a wholly-owned subsidiary of Nugget Exploration, Inc. Pursuant to the Merger, the shareholders of the Company received 81% of the outstanding common stock of Nugget Exploration, Inc. The accounting year was subsequently changed to the calendar year from a May 31st fiscal year end. On January 19, 2000, Nugget Exploration Inc. changed its name to GoHealth.MD, Inc. and then subsequently to Tree Top Industries, Inc. (the "Company"). Nature of Business For the year ended December 31, 1999, the Company did not conduct any significant business. After conducting the Merger, the Company engaged in developing its business model throughout the year ended December 31, 2000. On April 20, 2000, the Company entered into a consulting agreement with Joel Johnston under which the Company agreed to pay Mr. Johnston $7,800 per month for website development services rendered beginning on February 1, 2000, and extending indefinitely until canceled by either of the parties upon two days written notice. Also pursuant to this agreement, the Company issued 25,000 shares of its common stock to Mr. Johnston and agreed to issue to Mr. Johnston an additional 25,000 shares of common stock on each of June 1, 2000, July 1, 2000, October 1, 2000, November 1, 2000, December 1, 2000, January 1, 2001, and February 1, 2001, provided that the consulting agreement had not been terminated by either party prior to the applicable date. The contract was cancelled at the end of 2000, after having issued 75,000 shares to this consultant. In January 2002, this consultant was engaged for a separate assignment and was issued 25,000 shares for these services. The company recorded consulting expense of $3,750 for this work. In November 1999, the Company hired independent contractor, Stephen Goldberg, to perform administrative services. He received approximately $109,000 annually. The contract has not yet been renewed and the new board began negotiations regarding renewal of the contract in the first quarter of 2001. These negotiations were not completed. See Legal Proceedings. During the year 2002, the Company entered into a letter of intent with United Health Partners, but due to their inability to perform within the terms of the Agreement set forth therein, the Board on or about November 8, 2002, unanimously voted to terminate the Agreement. ITEM 1. DESCRIPTION OF BUSINESS (continued) Business Strategy The Company's primary objective for fiscal 2005 was to identify, and negotiate with a business target(s) for the merger of that entity(ies) with and into the Company. In certain instances, a target company may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge. No assurances can be given that the Company will be successful in identifying or negotiating with any target company. The Company would provide a means for a foreign or domestic private company to become a reporting (public) company whose securities would be qualified in the U.S. Secondary Capital market. Transfer Agent and Registrar The transfer agent and registrar for the common stock of the Company is ComputerShare Trust, 12039 West Alameda Parkway, Lakewood, Colorado 80228, telephone 303-986-5400. Controls and Procedures An evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer/Chief Financial Officer (who are both David Reichman), of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the quarter covered by this report. Based on his evaluation, our Chief Executive Officer/Chief Financial Officer has concluded there have not been any change in the issuer's internal control over financial reporting, the occurred during the quarter covered by this quarter, that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting and that the company's disclosure controls and procedures are effective to ensure that information required to be disclosed by our company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reporting within the time periods specified in Securities and Exchange Commission rules and forms and such information is accumulated and communicated to management, including our Chief Executive Officer/Chief Financial Officer as appropriate to allow timely decisions regarding required disclosures. ITEM 2. DESCRIPTION OF PROPERTY. The Company receives mail at 666 Fifth Avenue, Suite, 300, New York, NY 10103. ITEM 3. LEGAL PROCEEDINGS. The following legal proceedings were initiated against the Company, and judgments were entered against the Company because the Company did not have adequate working capital to provide a proper legal defense or to negotiate a settlement. Luckysurf v. GoHealth-judgment against GoHealth.$30,000. Facts & Comparisons v. GoHealth-judgment against GoHealth.$18,000. Free Ride v. GoHealth-Judgment against GoHealth.$55,512. Sales Guides, Inc v. GoHealth-judgment against GoHealth.$ 5,000. Steve Goldberg v. GoHealth-judgment against GoHealth.$40,000. Creditor's Adjustment Bur. v. GoHealth-Judgment against GoHealth.$ 9,213. (Assigned by AllAdvantage.Com) No legal action has been taken to enforce any of these judgments against the Company to date. There are no other legal proceedings pending against the Company. Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. No matters were submitted to a vote of security holders for the year ended December 31, 2005. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. The Company's common stock is currently traded through the over-the-counter market on the National Association of Securities Dealers, Inc. Bulletin Board ("NASD Bulletin Board") under the symbol "GOMD." Prior to January 19, 2000, the common stock was traded through the NASD Bulletin Board under the symbol "NUGT." Limited trading has occurred over the past several years. The following table set forth below lists the range of high and low bids of GOMD common stock for each fiscal quarter for the last two fiscal years as reported by NASD Bulletin Board. The prices in the table reflect inter- dealer prices, without retail markup, markdown or commission and may not represent actual transactions. The amounts, and all other shares and price information contained in this document, have been adjusted to reflect the stock splits. High Low Period Ended December 31, 2004 First Quarter $ 0.51 $ 0.05 Second Quarter $ 0.51 $ 0.07 Third Quarter $ 0.08 $ 0.04 Fourth Quarter $ 0.16 $ 0.05 Period Ended December 31, 2005 First Quarter $ 0.12 $ 0.08 Second Quarter $ 0.10 $ 0.04 Third Quarter $ 0.02 $ 0.02 Fourth Quarter $ 0.02 $ 0.02 At December 31, 2005 the average of the closing bid and asked price for the Company's common stock as reported by the NASD Bulletin Board was $0.02. As of December 31, 2005, the Company had approximately 643 shareholders of record. The Company has never paid a cash dividend on its common stock. The Company has a policy to retain earnings, if any, to finance the development and growth of its business. Accordingly, the Company does not anticipate declaring any cash dividends in the foreseeable future. Dividend Policy All shares of common stock are entitled to participate proportionally in dividends if our Board of Directors declares them out of the funds legally available. These dividends may be paid in cash, property or additional shares of common stock. We have not paid any dividends since our inception and presently anticipate that all earnings, if any, will be retained for development of our business. Any future dividends will be at the discretion of our Board of Directors and will depend upon, among other things, our future earnings, operating and financial condition, capital requirements, and other factors. Recent Sales of Unregistered Securities and Registered Securities There have not been any other recent sales of unregistered securities by the Company. ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. (continued) Our Shares are "Penny Stocks" within the Meaning of the Securities Exchange Act of 1934, as amended. Our Shares are "penny stocks" within the definition of that term as contained in the Securities Exchange Act of 1934, generally equity securities with a price of less than $5.00. Our shares will then be subject to rules that impose sales practice and disclosure requirements on certain broker-dealers who engage in certain transactions involving a penny stock, as amended. Under the penny stock regulations, a broker-dealer selling penny stock to anyone other than an established customer or "accredited investor" must make a special suitability determination for the purchaser and must receive the purchaser's written consent to the transaction prior to the sale, unless the broker-dealer is otherwise exempt. Generally, an individual with a net worth in excess of $1,000,000 or annual income exceeding $200,000 individually or $300,000 together with his or her spouse is considered an accredited investor. In addition, unless the broker-dealer or the transaction is otherwise exempt, the penny stock regulations require the broker-dealer to deliver, prior to any transaction involving a penny stock, a disclosure schedule prepared by the Securities and Exchange Commission relating to the penny stock market. A broker-dealer is also required to disclose commissions payable to the broker-dealer and the Registered Representative and current bid and offer quotations for the securities. In addition a broker-dealer is required to send monthly statements disclosing recent price information with respect to the penny stock held in a customer's account, the account's value and information regarding the limited market in penny stocks. As a result of these regulations, the ability of broker-dealers to sell our stock may affect the ability of Selling Security Holders or other holders to sell their shares in the secondary market. In addition, the penny stock rules generally require that prior to a transaction in a penny stock, the broker-dealer make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for a stock that becomes subject to the penny stock rules. These additional sales practice and disclosure requirements could impede the sale of our securities, if our securities become publicly traded. In addition, the liquidity for our securities may be adversely affected, with concomitant adverse affects on the price our securities. Our shares may someday be subject to such penny stock rules and our shareholders will, in all likelihood, find it difficult to sell their securities. PART IV ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS The following discussion of the financial condition and results of operations should be read in conjunction with the financial statements and the notes to the statement included elsewhere in this Report. Overview The Company was duly incorporated under the laws of the State of Nevada on July 24, 1980. On November 10, 1999, the Company's wholly-owned subsidiary, Nugget Holding Company, merged into GoHealth.MD Inc. ("GoHealth"), a Delaware corporation, (the "Merger"). Prior to the Merger, the Company had no operations and sought to consummate a business combination with another company that had operations. As a result of the Merger, GoHealth became the Company's wholly-owned subsidiary, and the shareholders GoHealth received 81% of the Company's outstanding common stock. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) Overview (continued) On January 19, 2000, the Company changed its name to GoHealth.MD Inc. For accounting purposes, the Merger was treated as GoHealth acquiring Nugget Exploration, Inc., and hence for this Management's Discussion section and accounting purposes, references to the "Company," refers to the operations of GoHealth.MD Inc., the Delaware corporation. The Company also changed our accounting year to the calendar year, the accounting year of GoHealth.MD Inc., the Delaware corporation. Business Strategy The Company's primary objective is to identify, and negotiate with a business target(s) for the merger of that entity(ies) with and into the Company. In certain instances, a target company may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge. No assurances can be given that the Company will be successful in identifying or negotiating with any target company. The Company would provide a means for a foreign or domestic private company to become a reporting (public) company whose securities would be qualified in the U.S. Secondary Capital market. Plan of Operations The Company's primary objective is to identify, and negotiate with a business target(s) for the merger of that entity(ies) with and into the Company. In certain instances, a target company may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge. No assurances can be given that the Company will be successful in identifying or negotiating with any target company. The Company would provide a means for a foreign or domestic private company to become a reporting (public) company whose securities would be qualified in the U.S. Secondary Capital market. However, since inception on February 23, 1999, and through December 31, 2005, the Company has sustained losses totaling $14,457,207. It has a working capital deficit at December 31, 2005 of $611,037, and revenue generated from operations in 2005 have amounted to $-0-. In order to continue to finance operations the Company will need to continue to receive funds from the exercise of options and warrants, through other equity or debt financing or through successfully negotiating a merger with an operating company. There can be no assurance that the Company will continue to receive any proceeds from these sources or that a merger candidate can be identified and an agreement reached. Critical Accounting Policies and Estimates This Management's Discussion and Analysis of Financial Condition and Results of Operations, as well as disclosures included elsewhere in this Form 10-KSB are based upon our audited consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingencies. On an on-going basis, we evaluate the estimates used, including those related to inventory valuation, impairment of tangible and intangible assets if applicable, accruals, contingencies and litigation. We base our estimates on historical experience, current conditions and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources, as well as identifying and assessing our accounting treatment with respect to commitments and contingencies. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies involve more significant judgments used in the preparation of the consolidated financial statements. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) Critical Accounting Policies and Estimates (continued) We value domain names available for sale as well as the carrying value of websites and investments at the lower of cost or market, or net realizable value, and write down the value of these assets for estimated amounts considered unmarketable or excessive based upon our estimates of recoverability. To the extent actual marketability or realizablity differs from management's estimates, additional write-down would be required. Results of Operations For the year ended December 31, 2005 the Company had total revenue of $-0-, and $-0- for the year ended December 31, 2004. For the year ended December 31, 2005 the Company had a net loss of $64,330 or $0.25 per share, compared with a net loss of $635,363 or $2.95 per share for the year ended December 31, 2004. For the year ended December 31, 2005 expenses totaled $64,330 compared with $635,363 for the year ended December 31, 2004. The decrease in expenses was due to the decrease in consulting fees, officer salaries and director fees. Management believes that the losses occurred because of the development and redirection of the Company and the untested revenue models associated with registering domain names and providing a portal of content from which to derive advertising and syndication revenues. Management plans to continue to negotiate reductions in amounts owed its suppliers and to seek additional debt and equity financing, including mergers with other operating companies. In this respect it is seeking to serve as a vehicle for an operating company to enter into a reverse merger or similar transaction with the Company and thereby enable such private company to emerge as a public entity. Liquidity and Capital Resources Since its inception on February 23, 1999, and through December 31, 2005, the Company has sustained losses totaling $14,457,207. It has a working capital deficit at December 31, 2005 of $611,037. Since inception, the Company has financed operations primarily through private equity financing. In order to continue to finance operations, the Company will need to receive funds from the exercise of outstanding warrants and options or through other equity or debt financing. There can be no assurance that the Company will receive any proceeds from the exercise of warrants or options or that will be able to obtain the necessary funds to continue to operate. During 2005 the Company used $64,330 in operating activities, and $64,330 was provided by financing activities primarily from proceeds from loans from officers. As a result of the foregoing there was no change to zero cash balance at the year end December 31, 2005. For the year ended December 31, 2004, the Company used $28,307 in operating activities, and $28,307 was provided by financing activities primarily from proceeds from loans from officers. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) RISK FACTORS Investment in the Company's securities involves a high degree of risk. The Company's business strategy may not be successful. It commenced Internet operations with the www.Healthmall.com website in November 1999 and for the period ended December 31, 2000, generated only minimal revenues, and this strategy was not successful. The risks and difficulties faced included the ability to: attract an audience of users to the Internet-based consumer healthcare network; increase brand awareness; offer compelling on-line content, services and e-commerce opportunities; attract a large number of advertisers who desire to reach users; respond effectively to the offerings of competitive providers of healthcare information on the Internet; continue to develop and upgrade technology; and attract, retain and motivate qualified personnel. The Company depended on the growing use of the Internet for advertising, commerce and communication, and on general economic conditions and was unsuccessful in this strategy. There can be no assurance that the current business strategy of seeking a merger with a target Company or targets will be successful. If it fails to address adequately any of these risks or difficulties, the business would likely suffer. In such case, the trading price of the Company's common stock could decline and investors could lose all or a part of their investment. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements for detailed information on our extremely limited operating history. The Company has a history of losses, negative cash flow and anticipates continued losses. Success in obtaining additional funding will determine the ability to continue and expand operations. There can be no assurance that the Company will ever achieve or sustain profitability or that operating losses will not increase in the future. See "Management's Discussion and Analysis of Financial Condition and Results of Operations" and accompanying financial statements. The Company has a working capital deficit and capital requirements will require additional financing which may not be available. The Company will need to obtain additional debt or equity financing to fund the costs of continuing operations until achieving positive cash flow. The Company has no current commitments or arrangements for additional financing and there can be no assurance that any additional debt or equity financing will be available to us on acceptable terms, or at all. If the Company is unable to satisfy its capital requirements, it may not be able to effectively compete in the marketplace or continue operations. There is a limited market for the Company's common stock. Currently only a limited trading market exists. The common stock trades on the OTC Bulletin Board under the symbol "GOMD". The Bulletin Board is a limited market and subject to substantially less restrictions and limitations in comparison to the NASDAQ National Market System. Any broker/dealer that makes a market in the stock or other person that buys or sells our stock could have a significant influence over its price at any give time. The Company can provide no assurance that the market in its common stock will be sustained. As a result, common stock holders may be unable to sell readily the stock held, if at all. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) RISK FACTORS (continued) The Company's stock price had been volatile. The history relating to the prices of newly public companies indicates that there may be significant volatility in the market price of the Company's common stock. As a result, holders of the Company's common stock may be subject to wide fluctuations in the value of their investment. Sales of common stock registered in a public offering could cause a. decline in stock price. A significant amount of common stock coming on the market at any given time could result in dilution as well as a decline in the price of such stock or increased volatility. Shareholders may face the possible inability to sell in the secondary market. In October 1990, Congress enacted the "Penny Stock Reform Act of 1990" to counter fraudulent practices common in stock transactions of companies which do not meet certain capital requirements, trading price requirements or listings requirements. The Company currently does not meet such requirements and therefore stock transactions involving our common stock would be subject to requirements of the Penny Stock Reform Act including: brokers and/or dealers, prior to effecting a transaction in the common stock, are required to provide investors with written disclosure documents containing information concerning various aspects of the market for our common stock as well as specific information about our common stock and the transaction involving the purchase and sale of the stock, such as price quotes and broker/dealer and associated person compensation; and subsequent to effecting a transaction, the broker is required to deliver monthly or quarterly statements containing specific information about our common stock. These requirements will most likely negatively affect the ability of purchasers herein to sell our common stock in the secondary market, if any. The Company has not declared and does not intend to declare dividends. Any investor who purchases our common stock should not anticipate receiving any dividends on their common stock at any time in the foreseeable future. Payment of dividends is within the absolute discretion of the board of directors and there can be no assurances that cash dividends will ever be paid on the common stock or that their value will ever increase. The Company has does anticipate. paying any dividends in the future. Some of the Company's stockholders own a significant amount of common stock and can exercise control over all matters submitted to a vote of shareholders. As a result, these stockholders are able to exercise significant influence, and in most cases control, over most matters requiring approval by stockholders, including the election of directors and approval of significant corporate transactions. This concentration of ownership may also have the effect of delaying, deterring or preventing a change in control that may otherwise be beneficial to investors. The Registrant has no Operating History, Revenue and Only Minimal Assets. The Registrant has had no operating history nor any revenues or earnings from operations for immediate past year. The Registrant has no significant assets or financial resources. The Registrant will, in all likelihood, incur operating expenses without corresponding revenues, at least until the consummation of a business combination. This may result in the Registrant incurring a net operating loss which will increase continuously until the Registrant can consummate a business combination with a target company. There can be no assurance that the Registrant will be able to identify such a target company and consummate such a business combination on acceptable terms or that it will derive any benefit from the net operating loss. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) The Nature of the Registrant's Proposed Operations is Speculative in Nature. The success of the Registrant's proposed plan of operation will depend to a great extent on the operations, financial condition, and management of any identified target company. While management intends to seek business combinations with entities having established operating histories, there can be no assurance that the Registrant will be able to identify a candidate satisfying such criteria. In the event the Registrant completes a business combination, of which there can be no assurance, the success of the Registrant's operations will be dependent upon management of the target company and numerous other factors beyond the Registrant's control. Possibilities for Business Opportunities and Combinations are Scarce, and the Registrant Faces Competition from Other Entities. The Registrant is and will continue to be an insignificant participant in the business of seeking mergers with and acquisitions of business entities. A large number of established and well-financed entities, including venture capital firms, are active in mergers and acquisitions of companies which may be merger or acquisition target candidates for the Registrant. Nearly all such entities have significantly greater financial resources, technical expertise, and managerial capabilities than the Registrant and, consequently, the Registrant will be at a competitive disadvantage in identifying possible business opportunities and successfully completing a business combination. Moreover, the Registrant will also compete with numerous other small public companies in seeking merger or acquisition candidates. The Registrant has no Agreement for a Business Combination or Other Transaction and the Registrant has not Set Any Objective Standards For a Business Combination. The Registrant has no current arrangement, agreement, or understanding with respect to engaging in a merger with or acquisition of a specific business entity. There can be no assurance that the Registrant will be successful in identifying and evaluating suitable business opportunities or in concluding a business combination. Management has not identified any particular industry or specific business within an industry for evaluation by the Registrant. There can be no assurance that the Registrant will be able to negotiate a business combination on terms favorable to the Registrant. The Registrant has not established a specific length of operating history or a specified level of earnings, assets, net worth, or other criteria which it will require a target company opportunity to have achieved, or without which the Registrant would not consider a business combination with such business entity. Accordingly, the Registrant may enter into a business combination with a business entity having losses, limited or no potential for earnings, limited assets, no significant operating history, negative net worth, or other negative characteristics. Current Management Devotes Limited Time to the Registrant. While seeking a business combination, management anticipates devoting time on a best efforts basis to the business of the Registrant. The Registrant's officers are: Mr. David Reichman, President and Chairman and Secretary, Mr. Frank Benintendo, Vice President, Secretary and Director, and Mr. Mike Valle, Vice President and Director, none of whom have entered into written employment agreements with the Registrant. The Registrant has not obtained key man life insurance on its officers and directors. Notwithstanding the combined limited experience and time commitment of management, loss of the services of any would adversely affect development of the Registrant's business and its likelihood of consummating a business combination. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) Current Management has Interests in Businesses that May Compete with the Registrant. The Registrant's officers and directors participate in other business ventures which may compete directly with the Registrant. Although none are anticipated, conflicts of interest and non-arms length transactions may also arise in the future. Management does not anticipate that the Registrant will seek a merger with, or acquisition of, any entity in which any member of management serves as an officer, director or partner, or in which they or their family members own or hold any ownership interest. See "ITEM 9. Directors and Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act. Reporting Requirements May Delay or Preclude Acquisition. Section 12 of the Exchange Act requires public companies to provide certain information about significant acquisitions, including certified financial statements for the company acquired covering one or two years, depending on the relative size of the acquisition. The time and additional costs that may be incurred by some target companies to prepare such financial statements may significantly delay or essentially preclude consummation of an otherwise desirable acquisition by the Registrant. Acquisition prospects that do not have or are unable to obtain the required audited statements may not be appropriate for acquisition so long as the reporting requirements of the Exchange Act is applicable. The Registrant has no Market Research or Marketing Information Regarding the Availability of Merger Candidates. The Registrant has not conducted, nor have others made available to it, market research indicating demand exists for the transactions contemplated by the Registrant. Even in the event demand exists for a merger or acquisition of the type contemplated by the Registrant, there can be no assurance the Registrant will be successful in completing any such business combination. The Registrant Could Suffer from a Lack Of Diversification in its Business Activities. The Registrant's proposed operations, even if successful, will, at least in the short term and in all likelihood in the long term, result in the Registrant engaging in a business combination with only one business opportunity. Consequently, the Registrant's activities will be limited to those engaged in by the business opportunity which the Registrant merges with or acquires. The Registrant's inability to diversify its activities into a number of areas may subject the Registrant to economic fluctuations within a particular business or industry and therefore increase the risks associated with the Registrant's operations. A Business Combination Likely Will Result in a Change in Control and Management. A business combination involving the issuance of the Registrant's common stock will, in all likelihood, result in shareholders of a target company obtaining a controlling interest in the Registrant. Any such business combination may require shareholders of the Registrant to sell or transfer all or a portion of the Registrant's common stock held by them. The resulting change. in control of the Registrant likely will result in removal of the present officers and directors of the Registrant and a corresponding reduction in or elimination of their participation in the future affairs of the Registrant. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS (continued) A Business Combination Likely Will Result in a Reduction Of Percentage Share Ownership. The Registrant's primary plan of operation is based upon the consummation of a business combination with a business entity which, in all likelihood, will result in the Registrant's issuing securities to shareholders of such business entity. The issuance of previously authorized and unissued common stock of the Registrant would result in reduction in percentage of shares owned by the. present shareholders of the Registrant and most likely would result in a change in control or management of the Registrant. A Business Combination Could Result in Tax Consequences for the Registrant's Shareholders. Federal and state tax consequences, in all likelihood, will be major considerations in any business combination the Registrant may undertake. Currently, such transactions may be structured so as to result in tax-free treatment to both companies, pursuant to various federal and state tax provisions. The Registrant intends to structure any business combination so as to minimize the federal and state tax consequences to both the Registrant and the target company; however, there can be no assurance that such business combination will meet the statutory requirements of a tax- free reorganization or that the parties will obtain the intended tax-free treatment upon a transfer of stock or assets. A non-qualifying reorganization could result in the imposition of both federal and state taxes which may have an adverse effect on both parties to the transaction or their respective shareholders. The SEC's Requirement Of Audited Financial Statements May Disqualify Business Opportunities. Management of the Registrant will request that any potential business opportunity provides audited financial statements. One or more potential combination candidates may opt to forego pursuing a business combination with the Registrant rather than incur the burdens associated with preparing audited financial statements. In such case, the Registrant may choose to obtain certain. assurances as to the target company's assets, liabilities, revenues and expenses prior to consummating a business combination, with further assurances that an audited financial statement would be provided after closing of such a transaction. Closing documents for such a transaction may include representations that the audited financial statements will not materially differ from the representations included in such closing documents. The Company's dependent auditors have indicated in their independent auditor's report that the financial condition of the Company, the working capital deficit and shareholder deficit, and the lack of adequate capital may pose a substantial question of the ability of the Company to continue as a going concern. See independent auditor's report accompanying our financial statements annexed hereto as an Exhibit. There can be no assurance that any capital raising efforts, or the operations of the Company, will improve the financial condition or prospects of the Company, or that the Company will continue as a going concern, or that the independent auditors will not raise a similar question in the future. ITEM 7. FINANCIAL STATEMENTS. Tree Top Industries (formerly Gohealth.MD, Inc.) Financial Statements December 31, 2005 Report of Independent Registered Public Accounting Firm -------------------------------------------------------- To the Stockholders and Board of Directors Tree Top Industries, Inc. New York, NY We have audited the accompanying balance sheets of Tree Top Industries, Inc. as of December 31, 2005 and 2004 and the related statement of operations, stockholders' equity and cash flows for the years 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 audits. We conducted our audit in accordance with standards of the PCAOB (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, audits of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Tree Top Industries, Inc. as of December 31, 2005 and 2004, and the results of our operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3, the Company's recurring operating losses and lack of working capital raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to those matters are also described in Note 3. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. /S/ Chisholm, Bierwolf & Nilson, LLC Chisholm, Bierwolf & Nilson, LLC Bountiful, Utah April 20, 2006 PART I ITEM 1. FINANCIAL STATEMENTS Tree Top Industries, Inc. (formerly GoHealth.MD, Inc.) Consolidated Balance Sheets As at
December 31, 2005 December 31, 2004 ----------------- ----------------- Assets Current Assets Cash $ - $ - ----------------- ----------------- Total Current Assets $ - $ - ----------------- ----------------- Total Assets $ - $ - ================= ================= Liabilities and Stockholders' Deficit Current Liabilities Notes Payable $ 113,000 $ 113,000 Accounts Payable 348,019 330,824 Accrued Expenses 15,250 15,250 Accrued Interest Payable 29,864 22,575 Due to Related Party 1,200 1,200 Due to Officers and Directors 103,704 63,860 ----------------- ----------------- Total Current Liabilities 611,037 546,709 Equity Common Stock 75,000,000 common stock par value .001 authorized. Issued and outstanding at December 31, 2005 and 2004 252,791 Shares 253 253 Additional Paid-In Capital 13,845,917 13,845,917 Retained earnings or (Deficit accumulated during development stage) (14,457,207) (14,392,879) ----------------- ----------------- Total Stockholders' Equity (611,037) (546,709) ----------------- ----------------- Total Liabilities and Stockholders' Equity $ - $ - ================= =================
See accompanying notes to financial statements. Page Two Tree Top Industries, Inc. (formerly GoHealth.MD, Inc.) Consolidated Statements of Operations For Years Ended
December 31, 2005 December 31, 2004 ----------------- ----------------- Operating Expenses General, Selling and Administrative $ 42,758 $ 5,172 Professional Fees 12,220 18,900 Consulting Fees 2,061 114,000 Officers' Salaries - 74,000 Directors' and Officers' Compensation - 416,072 ----------------- ----------------- Net Operating Loss 57,039 628,072 ----------------- ----------------- Interest Expense 7,291 7,291 ----------------- ----------------- Net Loss Before Taxes (64,330) (635,363) ----------------- ----------------- Income Tax Expense - - ----------------- ----------------- Net Loss (64,330) (635,363) ================= ================= Net Loss per share basic and diluted (.25) (2.95) Weighted average number of common shares outstanding: basic and diluted 252,791 215,624
See accompanying notes to financial statements. Page Three Tree Top Industries, Inc. (formerly GoHealth.MD, Inc.) Consolidated Statements of Stockholders' Equity From December 31, 2002 through December 31, 2005
Additional Retained Common Stock Paid in Earnings Shares Amount Capital (Deficit) ---------- ---------- ------------ ------------ Balance as at December 31, 2003 178,791 179 13,241,991 (13,757,516) Shares issued for services at $16.00 per share 14,000 14 223,986 - Shares issued for services at $5.00 per share 10,000 10 49,990 - Shares issued for services at $7.00 per share 30,000 30 209,970 - Shares issued for services at $6.00 per share 20,000 20 119,980 - Net (Loss) for year ended December 31, 2004 (635,363) ---------- ---------- ------------ ------------ Balance as at December 31, 2004 252,791 253 13,845,917 (14,392,879) Net (Loss) for year ended December 31, 2005 (64,330) ---------- ---------- ------------ ------------ Balance as at December 31, 200 252,791 253 13,845,917 (14,457,209) ========== ========== ============ ============
See accompanying notes to financial statements. Page Four Tree Top Industries, Inc. (formerly GoHealth.MD, Inc.) Consolidated Statement of Cash Flows For Years Ended
December 31, 2005 December 31, 2004 ----------------- ----------------- OPERATING ACIVITIES Net Loss $ (64,330) $ (635,363) Adjustments to Reconcile Net Income to Cash used by Operating Activities: Issuance of Stock for Compensation Expense 0 554,000 Issuance of Stock for Services 0 50,000 Changes in Assets and Liabilities: Increase (Decrease) in Accounts Payable 17,195 (485) Increase (Decrease) in Accrued Expenses 0 (3,750) Increase in Accrued Interest Payable 7,291 7,291 ----------------- ----------------- CASH FLOWS USED IN OPERATING ACTIVITIES (39,844) (28,307) CASH FLOWS FROM INVESTING ACIVITIES Net Cash Provided by Investing Activities 0 0 ----------------- ----------------- CASH FLOWS FROM FINANCING ACIVITIES Proceeds from Officer Loans 39,844 28,307 ----------------- ----------------- NET CASH PROVIDED BY FINANCING ACTIVITIES 39,844 28,307 Net Increase (Decrease) In Cash 0 0 Cash Beginning of Period 0 0 ----------------- ----------------- Cash End of Period $ 0 $ 0 ================= ================= Supplemental Cash Flow Information - ---------------------------------- Interest 0 0 Income Tax 0 0 NON-CASH TRANSACTIONS Expense Paid by Director or Officer 39,844 28,307
See accompanying notes to financial statements. Page Five Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 1 - CORPORATE HISTORY On July 30, 2004 by resolution of the Board of Directors, the name of the Company was changed from GoHealth.MD Inc. to Tree Top Industries, Inc., the number of shares of common stock the Company is authorized to issue was increased to 75 million from 25 million, and the par value of the common stock was changed from $.01 to $.001 per share. The financial statements for the periods presented in this annual report reflect these events. Tree Top Industries, Inc. ("Tree Top" or "Company"), was incorporated under the laws of the State of Delaware on February 23, 1999. From its inception the Company was engaged in the Internet advertising industry, but never achieved operations. The Company has been attempting to identify and negotiate with a business target for the merger of that entity with and into the Company. In certain instances, a target company may wish to become a subsidiary of the Company or may wish to contribute assets to the Company rather than merge. No assurances can be given that the Company will be successful in identifying or negotiating with any target company. The Company could provide a means for a foreign or domestic private company to become a reporting (public) company whose securities would be qualified for trading in the United States secondary market. On November 10, 1999, Tree Top (fka GoHealth) and a wholly-owned subsidiary Nugget Exploration, Inc. (a publicly traded Nevada corporation) completed a planned Stock Exchange Agreement and Plan of Merger. Under the terms of the agreement, Tree Top (fka GoHealth) became a wholly-owned subsidiary of Nugget Exploration Inc. and the wholly-owned subsidiary of Nugget merged with and into Tree Top (fka GoHealth). The stockholders of Tree Top (fka GoHealth) received one share of common stock of Nugget for each share of Tree Top (fka GoHealth) common stock held, resulting in the current stockholders of Tree Top (fka GoHealth) owning approximately 81% of Nugget common stock. The merger was accounted for as a purchase. However, since the stockholders of Tree Top (fka GoHealth) own approximately 81% of Nugget outstanding shares, and therefore have control, they were deemed to be the acquirer and no step up in basis was reflected and no goodwill was recorded by the company. This accounting treatment is in accordance with the Securities and Exchange Commission staff's view that the acquisition by a public shell of assets of a business from a private company for a significant number of shares should be accounted for at historical costs and accounted for as a reverse merger. Concurrent with this transaction, Nugget Exploration changed its name to GoHealth.MD Inc and then subsequently to Tree Top Industries, Inc. The Company has experienced significant operating losses, has a stockholders' deficit and negative working capital. Therefore, its ability to continue as a going concern is uncertain and is dependent upon its ability to raise additional financing to meet operating expenses, and its ability to negotiate settlements with creditors to reduce amounts owed to them, and to extend terms upon which they will be paid. It is uncertain if the Company will be successful in raising such financing or negotiating such settlements with its creditors. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying financial statements as of December 31, 2005 and 2004 and for the years then ended consolidate the accounts of the parent company and its wholly-owned subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Fair Value of Financial Instruments The carrying amount of cash and accounts payable are considered to be representative of their respective fair values because of the short-term nature of these financial instruments. Revenue Recognition Revenue is recognized in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial Statements." Revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability is reasonably assured. Use of Management's Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. Reclassifications Certain reclassifications have been made to the prior period balances to conform to the current period's presentation. Stock-Based Compensation The Company has elected to follow Accounting Principles Board Opinion No. 25, (APB 25) "Accounting for Stock Issued to Employees" in accounting for its employee stock option plans. Under APB 25, when the exercise price of the Company's employee stock options equals or is above the market price of the underlying stock on the date of grant, no compensation expense is recognized. In accounting for options granted to persons other than employees, the provisions of Financial Accounting Standards Board (FASB) Statement No. 123, (SFAS 123) "Accounting for Stock Based Compensation" are applied in accordance with SFAS 123 at the fair value of these options. In December, 2002, SFAS 148 was issued. SFAS 148 amends SFAS 123 to require a more prominent disclosure of the pro-forma results required by SFAS 123. No stock options were issued during the periods presented in these financial statements. Therefore, the net loss as reported for these periods and the pro forma loss arising from stock-based compensation expense determined under the fair value method are the same. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued) Earnings (Loss) Per Share The Company calculates earnings per share in accordance with SFAS No. 128, "Computation of Earnings Per Share" and SEC Staff Accounting Bulletin No. 98. Accordingly, basic earnings per share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the period. Common equivalent shares consist of the incremental common shares issuable upon the conversion of the Preferred Stock (using the if-converted method) and shares issuable upon the exercise of stock options (using the treasury stock method); common equivalent shares are excluded from the calculation if their effect is anti-dilutive. For the Years Ended December 31, 2005 2004 ----------- ------------ Basic Earnings per share: Income (Loss) (numerator) $ (64,330) $ (635,363) Weighted Average Shares (denominator) 252,791 215,624 ----------- ------------ Per Share Amount $ (.25) $ (2.95) =========== ============ Options for 535,000 shares of common stock were not included as anti- dilutive. Income Taxes The Company follows Statement of Financial Accounting Standards No. 109, (SFAS 109) "Accounting for Income Taxes". SFAS 109 requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued) Recent Accounting Pronouncements In November 2004, the FASB issued SFAS No. 151, Inventory Costs an amendment of ARB No. 43, Chapter 4 This Statement amends the guidance in ARB No. 43, Chapter 4 Inventory Pricing. SFAS No. 151 clarifies the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). SFAS No. 149 is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. The adoption of SFAS No. 151 will not have an impact on the Company's consolidated financial statements. In December 2004, the FASB issued SFAS No. 152, Amendment of FASB Statement No. 66, Accounting for Sales of Real Estate, which references the financial accounting and reporting guidance for real estate time-sharing transactions that is provided in AICPA Statement of Position. This Statement also amends FASB Statement No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects, to state that the guidance for incidental operations and costs incurred to sell real estate projects does not apply to real estate time-sharing transactions. SFAS No. 152 is effective for financial statements for fiscal years beginning after June 15, 2005. The adoption of SFAS No. 152 will not have an impact on the Company's consolidated financial statements. In December 2004, the FASB issued SFAS No. 153, Amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions, which is based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged. SFAS No. 153 is effective for non- monetary exchanges occurring in fiscal periods beginning after June 15, 2005. This adoption of SFAS No. 153 did not have any impact on the Company's financial statements. In May 2005, the FASB issued SFAS No 154, Accounting Changes and Error Corrections - a replacement of APB Opinion No. 20 and FASB Statement No. 3. ThisStatement shall be effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Early adoption is permitted for accounting changes and corrections of errors made in fiscal years beginning after the date this Statement is issued. This Statement does not change the transition provisions of any existing accounting pronouncements, including those that are in a transition phase as of the effective date of this Statement. In December 2004, the FASB issued SFAS No. 123 (Revised), Accounting for Stock-Based Compensation, which establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity's equity instruments or that may be settled by the issuance of those equity instruments. This Statement focuses primarily on accounting for transactions in which an entity obtains employee services in share-based payment transactions. This adoption of SFAS No. 123 (revised) did not have any impact on the Company's financial statements. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 3 - GOING CONCERN The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. Currently, the Company has no cash or other material assets, nor does it have an established source of revenues sufficient to cover any anticipated operating costs to allow it to continue as a going concern. Since its inception on February 23, 1999, and through December 31, 2005, the Company has sustained losses totaling $14,457,207. It has a working capital deficit at December 31, 2005 of $611,037. Revenues generated from advertising and domain name sales have totaled only $49,462 from its inception through December 31, 2004. Sales of advertising on its websites and sales of its domain names had been the foundation of the Company's plan to generate revenue and reach profitability from its operations. Through the date of these financial statements it has been unsuccessful in achieving its goals. For the period from inception (February 23, 1999) through December 31, 2005, the Company has not generated any significant business. Through the date of these financial statements viable operations have not been achieved and the Company has been unsuccessful in raising all the capital that it requires. Revenues have been minimal and the Company continues to require substantial financing. Most of the financing during the current fiscal year has been provided by David Reichman, the present CEO, Chairman and President, and the Company is dependent upon his ability and willingness to continue to provide such financing which is required to meet reporting and filing requirements of a public company. The Company currently is continuing to attempt to negotiate reductions in amounts owed its suppliers and to seek additional debt and equity financing, including mergers with other companies. It also is seeking to serve as a vehicle for an operating private company to enter into a reverse merger with the Company and thereby enable such private entity to emerge as a public entity. In order for the Company to remain a reporting entity it will need to continue to receive funds from the exercise of outstanding warrants and options, through other equity or debt financing or through successfully negotiating a merger with an operating company. There can be no assurance that the Company will continue to receive any proceeds from the exercise of warrants or options, that the Company will be able to obtain the necessary funds to finance its operations, or that a merger candidate can be identified and an agreement negotiated, all of which raises substantial doubt about its ability to continue as a going concern. NOTE 4 RELATED PARTY TRANSACTIONS In early April 2002 officers and directors lent the Company $25,235. Through December 31, 2005 and 2004, an additional 68,151, and $28,307, respectively, was loaned to the Company by David Reichman, CEO, Chairman and President. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 5 - NOTES PAYABLE The Company has the following note December 31, December 31, payable obligations: 2005 2004 ------------ ------------ Note payable to Facts and Comparisons due September 1, 2002, with interest accrued at 6% per annum, unsecured, in settlement of a trade payable; unpaid to date and in default $ 18,000 $ 18,000 Note payable to Luckysurf.com due September 12, 2002 with interest accrued at 6% per annum, unsecured, in settlement of a trade payable; unpaid to date and in default 30,000 30,000 Note payable to Michael Marks (a shareholder) due August 31, 2000 with interest accrued at 5% per annum, unsecured; unpaid to date and in default 25,000 25,000 Note payable to Steven Goldberg (a former consultant) due July 10, 2002, unsecured with interest of 7% accrued if unpaid at due date, in settlement of liability; unpaid to date and in default 40,000 40,000 ------------ ------------ Totals $ 113,000 $ 113,000 Less Current Maturities (113,000) (113,000) ------------ ------------ Total Long-Term Notes Payable $ - $ - ============ ============ Following are maturities of long-term debt for each of the next five years: Year Amount ------------ ------------ 2006 $ 113,000 2007 - 2008 - 2009 - Thereafter - ------------ Total $ 113,000 ------------ ------------ None or these notes have been paid, and management has indicated that no demand for payment for any of these notes has been received by the Company. However, as indicated in Note 8, Litigation, the Company received a notice of motion from Luckysurf.com dated October 22, 2002, seeking entry of a judgment for $30,000. No further information or action has been received by the Company relating to this note. On December 10, 2001 a note for $75,000 with a remaining balance of $56,800 due to Sandra Vernon, a greater than 5% stockholder, was forgiven by the note holder and the outstanding balance of the note at that date was recorded as additional paid in capital. A note due on December 29, 2000 from Kevin O'Donnell for $50,000, a stockholder and former officer, was forgiven by the note holder on June 27, 2002 in exchange for 75,000 shares of the Company's common stock, and the outstanding balance of the note at that date, as well as accrued interest through that date of $7,685 was recorded as additional paid in capital. In exchange for 250,000 shares of the Company's common stock a note payable of $1,500 due on demand to William Hanna, a stockholder, former CEO and director was forgiven by him on June 27, 2002 as well as accrued interest thereon of $1,561 and an amount reflected as due to related party of $17,986. Pursuant to the terms of this transaction $16,453 was recorded as compensation and $35,000 was recorded as additional paid in capital. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 6 - INCOME TAXES The Company has adopted Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes" and has applied the provisions of the statement to the current year which resulted in no significant adjustment. Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes" requires an asset and liability approach for financial accounting and reporting for income tax purposes. This statement recognizes (a) the amount of taxes payable or refundable for the current year and (b) deferred tax liabilities and assets for future tax consequences of events that have been recognized in the financial statements or tax returns. Deferred income taxes result from temporary differences in the recognition of accounting transactions for tax and financial reporting purposes. There were no temporary differences at December 31, 2004 and earlier years; accordingly, no deferred tax liabilities have been recognized for all years. The Company has cumulative net operating loss carryforwards of $14,457,207 at December 31, 2005. No effect has been shown in the financial statements for the net operating loss carryforwards as the likelihood of future tax benefit from such net operating loss carryforwards is not presently determinable. Accordingly, the potential tax benefits of the net operating loss carryforwards, estimated based upon current tax rates at December 31, 2005 have been offset by valuation reserves in the same amount. The net operating losses begin to expire in 2019. The deferred tax asset and the valuation account is as follows at December 31, 2005 and 2004: December 31, 2005 2004 ------------ ------------ Deferred tax asset: Federal Income Tax $ - $ - State Income Tax $ - - Deferred noncurrent tax asset $ 4,915,450 $ 4,893,579 Valuation allowance (4,915,450) (4,893,579) ------------ ------------ Total $ - $ - ============ ============ December 31, 2005 2004 ------------ ------------ The components in income tax expense are as follows: Federal Income Tax - - State Income Tax - - Change in deferred tax asset $ (21,871) $ (213,520) Change in valuation allowance $ 21,871 $ 213,520 ------------ ------------ Income Tax expense $ - $ - ------------ ------------ ------------ ------------ Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 7 - STOCKHOLDERS' EQUITY (DEFICIT) The common stock and additional paid-in capital as reflected on the December 31, 2005 and 2004 balance sheets is restated to reflect the change in par value of the common stock from $.01 to $.001 per share which took place during the year 2004, as well as a 100:1 reverse split that occurred during the year 2005. As a result the change in common stock was charged to additional paid in capital. This change has been retroactively restated on the statements of stockholders' equity. On May 26, 2004 the Board of Directors authorized the issuance of 4,000 shares of the Company's common stock at a price of $16 per share to a marketing and consulting firm and 10,000 shares of common stock at a price of $16 per share to Anthony Fiordalisi for joining the board of directors. On July 30, 2004, the Board of Directors authorized the issuance of 10,000 shares at a price of $7 per share to each of David Reichman, Chairman, Chief Executive Officer, and stockholder, Gary Crooks, Vice President, director and stockholder, and Anthony Fiordalisi, director and stockholder, as compensation for services rendered to the Company for the period May 1, 2003 through April 30, 2004. The Board of Directors also authorized setting the maximum number of directors at seven members. On September 17, 2004, the Board of Directors authorized the issuance of 10,000 shares at a price of $6.00 per share to each of Frank Benintendo and Mike Valle as compensation for accepting appointment to the Board of Directors and 10,000 shares at a price of $6.00 per share to a consultant for services rendered. Warrants to Purchase Common Stock On March 10, 2000 the Company issued a warrant to purchase 100,000 shares of common stock of the Company at $1.50 per share to a consultant pursuant to a one-year consulting agreement. This warrant expired on March 10, 2005 In connection with this agreement the Company also issued to the consultant 10,000 shares of its common stock on that date. The Company recorded consulting expense of $387,000 over the life of the agreement based on the market value of its common stock on the date of the agreement. The activity for warrants to purchase common stock for the periods presented in these financial statements are as follows: Weighted Range of Weighted Average Exercise Average Contractual Price Exercise Life Shares Per Share Price (Years) ----------- ----------- ----------- ----------- Warrants outstanding at January 1, 2004 102,000 $1.50-2.60 $ 2.01 1.28 ----------- ----------- ----------- ----------- Warrants outstanding at December 31, 2004 100,000 2.50-2.60 2.50 .42 Granted - - - - Exercised - - - - Expired (100,000) 2.50-2.60 2.50 .42 ----------- ----------- ----------- ----------- Warrants outstanding at December 31, 2005 - $ - $ - =========== =========== =========== Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 7 - STOCKHOLDERS' EQUITY (DEFICIT)(continued) Employee Stock Options In February 1999 the Company reserved a total of 500,000 shares of its common stock for grants of stock options to employees. A total of 230,000 options with an exercise price of $0.50 per share and terms expiring seven (7) years from the respective dates of grant were granted to two of the officers of the Company at that time. As referred to in Note 2, the Company has elected to follow the Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB 25) and related Interpretations in accounting for its employee stock options because, as discussed below, the alternative fair value accounting provided for under FASB Statement No. 123 (SFAS 123), "Accounting for Stock Based Compensation," requires the use of option valuation models that were not developed for use in valuing employee stock options. Under APB 25, because the exercise price of the Company's employee stock options equaled the market value of the underlying stock on the date of grant, no compensation expense was recognized. Pro forma information in accordance with SFAS 123 was required to present net loss and loss per share as if the Company had accounted for the employee stock options under the fair value method of that statement. SFAS 123 also provides that if it is not possible to reasonably estimate the fair value of an option at the grant or measurement date, then the compensation cost shall be based on the current intrinsic value of the award which was determined to be immaterial. No other stock options have been issued to employees from the dates of these grants through date of these financial statements. Other Stock Options On May 26, 1999 the Company granted 5,000 options to investment banking consultants for services rendered at an exercise price of $0.50 per share, and 5,000 options which have an exercise price of $1.00 per share. These options expire May 26, 2006 and contain piggyback registration rights. The fair value of these options were estimated at the grant date using the Black Scholes option pricing model and were determined to be immaterial. On June 12, 1999 the Company granted 20,000 options to a consultant for legal services rendered. These options expire on June 12, 2006 and include piggyback registration rights. 10,000 options are exercisable at $1.00 per share and 10,000 are exercisable at $1.50 per share. The fair value of these stock options were estimated at the grant date according to SFAS 123 using the Black Scholes option pricing model and were determined to be immaterial. In August 1999 the Company granted to two consultants who assisted in the development of the Company's website nonqualified stock options for the right to purchase 175,000 shares of the Company's common stock. The options have an exercise price of $1.00 per share, contain piggyback registration rights and expire in July 2009. The fair value of these stock options were estimated at the grant date according to SFAS 123 using the Black Scholes option pricing model and were determined to be immaterial. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 7 - STOCKHOLDERS' EQUITY (DEFICIT) (continued) Other Stock Options (continued) On January 24, 2000 the Company entered into an agreement and acquired the right, title and interest to the Healthsites.com domain name from a third party. The purchase price of this asset was $20,000, issuance of 10,000 shares of common stock valued at approximately $200,000 and the grant of an option to purchase 100,000 shares of common stock at $2.00 per share until August 17, 2009. The fair value of this option was estimated at the date of grant according to SFAS 123 using the Black Scholes option pricing model and was determined to be immaterial. The unamortized value of this website was fully written off in 2001. The activity for employee and other stock options for the periods presented in these financial statements are as follows: Weighted Average Range of Weighted Remaining Exercise Average Contractual Prices Exercise Life Shares Per Share Price (Years) ---------- ----------- --------- ----------- Options outstanding at January 1, 2004 535,000 $0.50-2.00 $ 0.98 5.01 Granted - - - - Exercised - - - - Expired - - - - 0.50-2.00 0.98 .05 ----------- --------- ----------- Options Outstanding at December 31, 2005 535,000 0.50-2.00 0.98 4.96 Granted - - - - Exercised - - - - Expired - - - - ----------- --------- ----------- Options outstanding at December 31, 2005 535,000 $0.50-2.00 $ 0.98 2.96 =========== ========= =========== All employee and other stock options were fully vested at December 31, 2005 and 2004. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 8 COMMITMENTS AND CONTINGENCIES Litigation The Company was a defendant in a lawsuit from a supplier alleging nonpayment of amounts owed for services rendered. The amount asserted was $300,000. The Company reflected this amount in accounts payable at December 31, 2000. Management settled this lawsuit on November 30, 2001 and issued a note payable for $18,000 due September 1, 2002 with interest at 6% per annum in full settlement of this claim. As reflected in Notes Payable, the amount due on this note remains unpaid, and management has indicated that it has received no demand for payment from this note holder. The Company was a defendant in a lawsuit from another supplier also alleging nonpayment of amounts owed for services rendered. The amount asserted was $50,100. Management vigorously defended itself in this action alleging that no contract existed and that services were not rendered for the asserted amount. However, the Company included this amount in accounts payable at December 31, 2001. This lawsuit was settled on May 1, 2002 by issuing a non interest bearing note payable for $25,000 due on September 12, 2002. The Company recorded a gain on debt settlement of $34,100 arising from this agreement in the second quarter of 2002. The Company defaulted on this note, has not paid it to date and received a notice of motion dated October 22, 2002, seeking entry of a judgment for $30,000 plus interest effective December 6, 2002. The Company adjusted the gain it recorded in the prior quarter during the three months ended September 30, 2002, and has recorded interest expense at 6% per annum from May 1, 2002, the date of settlement, through the end of 2005. The Company was a defendant in a lawsuit from another supplier that is also alleging nonpayment of amounts owed for services rendered. The amount asserted was $54,712, and a judgment was entered in this matter for $55,512. The Company has included this amount in accounts payable at December 31, 2004 and December 31, 2005. The Company was a defendant in a lawsuit from another supplier that also alleging nonpayment of amounts owed for services rendered. The amount asserted was $4,298. A judgment was entered for $4,352 and the Company has included this amount in accounts payable. The Company was a defendant in a lawsuit from a fourth supplier also alleging nonpayment of amounts owed for services rendered. The amount asserted was $9,675. Management has included this amount in accounts payable at December 31, 2004 and December 31, 2005. The company was a defendant in another lawsuit from a former consultant alleging nonpayment of amounts owed for services rendered. The amount asserted was $40,000. Management believed the suit was without merit and has counterclaimed for damages and equitable relief against the plaintiff. Management has executed a note payable to this plaintiff for the amount claimed which was due on July 10, 2002 and remains unpaid. Pursuant to the terms of this note, the Company has recorded interest payable at 7% for the period July 10, 2002 through December 31, 2005. Tree Top Industries, Inc. (formerly Gohealth.MD, Inc.) Notes to the Financial Statements December 31, 2005 NOTE 9 - OTHER MATTERS On May 21, 2003 William Hanna resigned as Chairman, CEO and director effective May 31, 2003. David Reichman the President of the Company was appointed to the additional positions of Chairman, and CEO on May 21, 2003 to replace William Hanna. Anthony Fiordalisi was appointed Secretary and Treasurer of the Company on that date and was elected to the Board of Directors filling the vacancy caused by William Hanna's resignation. The Company does not have an audit committee of the Board of Directors as required by the Sarbanes-Oxley Act of 2002 and listing requirements of the National Association of Securities Dealers. Management has indicated that it is actively seeking candidates to fill these roles who are independent and meet the financial expertise required by these rules. On June 11, 2001, the Company received written notification from a stockholder who wishes to recoup his $10,400 investment in a private placement of common stock of the Company that he made in May 1999, and another investment of $2,500 in a private offering of Series A warrants in December 1999. The stockholder alleges that these investments were not suitable for him. There has been no further action with regard to this matter during 2004 or 2005 and the Company continues to assert that the claim is without merit. ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. None ITEM 8a. Controls and Procedures. An evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer/Chief Financial Officer (who are both David Reichman), of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the quarter covered by this report. Based on his evaluation, our Chief Executive Officer/Chief Financial Officer has concluded there have not been any change in the issuers' internal control over financial reporting, that occurred during the quarter covered by this report, that has materially affected, or is reasonably likely to materially affect, the issuer's internal control over financial reporting and that the company's disclosure controls and procedures are effective as of December 31st 2005 to ensure that information required to be disclosed by our company in reports that it files or submitsunder the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and such information is accumulated and communicated to management, including our Chief Executive Officer/Chief Financial Officer as appropriate to allow timely decisions regarding required disclosures. PART III ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT The executive officers and directors, their respective ages and their positions as of December 31, 2005 were as follows: Name Age Position(s) and Office(s) - ------------------ ------- --------------------------------------------- David Reichman 61 President, Chief Executive Officer, Chief Financial Officer and Chairman Gary Crooks 54 Vice President and Director Anthony Fiordalisi 58 Secretary and Director Frank Benintendo 57 Director Mike Valle 48 Director Mr. Reichman, after a five year stay with American Express Company, moved on in 1975 to form his own private consulting practice specializing in tax representation and business management. He has been an officer and director of the Company since 2003. Mr. Crooks was the managing director of a branch office of SAL Financial Services, Inc. Mr. Crooks has more than twenty-five years experience in the financial industry, a third of which were as a senior equity trader at Morgan Stanley. He has been an officer and director of the Company since 2003. Mr. Fiordilisi is the owner of a private video post production company with approximately 37 employees located in midtown New York, New York. He has been in that industry for over twenty years. He also recently formed a state of the art film processing company in the same building. His two companies occupy over 30,000 square feet. He was appointed to the Board of Directors to fill the void of William Hanna in May, 2003. ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT (continued) Board of Directors Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and have qualified. Officers are appointed to serve until the meeting of the Board of Directors following the next annual meeting of stockholders and until their successors have been elected and have qualified. AUDIT COMMITTEE FINANCIAL EXPERT The Company does not have a separately designated standing audit committee. Pursuant to Section 3(a)(58)(B) of the Exchange Act, the entire Board of Directors acts as an audit committee for the purpose of overseeing the accounting and financial reporting processes, and our audits of the financial statements. The Commission recently adopted new regulations relating to audit committee composition and functions, including disclosure requirements relating to the presence of an "audit committee financial expert" serving on its audit committee. In connection with these new requirements, our Board of Directors examined the Commission's definition of "audit committee financial expert" and. concluded that we do not currently have a person that qualifies as such an expert. Presently, there are only three (3) directors serving on our Board, and we are not in a position at this time to attract, retain and compensate additional directors in order to acquire a director who qualifies as an "audit committee financial expert", but we intend to retain an additional director who will qualify as such an expert, as soon as reasonably practicable. While neither of our current directors meets the qualifications of an "audit committee financial expert", each of our directors, by virtue of his past employment experience, has considerable knowledge of financial statements, finance, and accounting, and has significant employment experience involving financial oversight responsibilities. Accordingly, we believe that our current directors capably fulfill the duties and responsibilities of an audit committee in the absence of such an expert. CODE OF ETHICS We are presently working with our legal counsel to prepare and adopt a code of ethics that applies to our principal chief executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (the "Code of Ethics"). A draft of the Code of Ethics is attached hereto as Exhibit 14.1 The Code of Ethics is being designed with the intent to deter wrongdoing, and to promote the following: - - Honest and ethical conduct, including the ethical handling of actual or apparent conflicts if interest between personal and professional relationships - - Full, fair, accurate, timely and understandable disclosure in reports and documents that a small business issuer files with, or submits to, the Commission and in other public communications made by the small business issuer - - Compliance with applicable governmental laws, rules and regulations - - The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code - - Accountability for adherence to the code ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT (continued) SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE Under Section 16(a) of the Exchange Act, all executive officers, directors, and each person who is the beneficial owner of more than 10% of the common stock of a company that files reports pursuant to Section 12 of the Exchange Act, are required to report the ownership of such common stock, options, and stock appreciation rights (other than certain cash-only rights) and any changes in that ownership with the Commission. Specific due dates for these reports have been established, and the Company is required to report, in this Form 10-KSB, any failure to comply therewith during the fiscal year ended December 2003. We believe that all of these filing requirements were satisfied by our executive officers, directors and by the beneficial owners of more than 10% of our common stock, with the exception of a Form 3 filing by Anthony Fiordilisi in May of 2003, and a Form 4 filing by David Reichman in May of 2003. Messrs. Fiordilisi and Reichman will correct these filings as promptly as practicable. In making this statement, the Company have relied solely on copies of any reporting forms received by it, and upon any written representations received from reporting persons that no Form 5 (Annual Statement of Changes in Beneficial Ownership) was required to be filed under applicable rules of the Commission. ITEM 10. EXECUTIVE COMPENSATION. The following tables set forth information with respect to the compensation received for year ended December 31, 2004 by the President and other most highly compensated individuals. No compensation in excess of $100,000 was awarded to, earned by, or paid to any executive officer or director during the years ended December 31, 2005, 2004 and 2003.
SUMMARY COMPENSATION TABLE Annual Compensation Awards Payouts -------------------- ---------------- ---------------- Restr All Name & Annual icted Securi LTIP Other Principal Other Compen Stock -ties Under- Compen Position Year Salary Bonus sation Options Awards lying sation ($) ($) ($) (#) (#) ($) ($) - ----------------------------------------------------------------------------- David 2004 - - - - - - - Reichman 2003 - - - - - - - President 2002 - - - $9,750 - - - (1) Gary Crooks 2004 - - - - - - - Vice 2003 - - - - - - - President 2002 - - - $9,750 - - - (1) William Hannh 2004 - - - - - - - (Former 2003 - - - - - - - Chairman) 2002 - - - $9,750 - - -
(1) Footnotes: (1) Represents an award of 650,000 shares of common stock of the Company, which had a fair market value on March 1, 2002, the date of grant, of $9,750, based on the average of the high and low bid price of $0.015 on such date. No compensation in excess of $100,000 was awarded to, earned by, or paid to any executive officer or director during the years ended December 31, 2003, 2004 and 2005. ITEM 10. EXECUTIVE COMPENSATION. (continued) STOCK OPTIONS GRANTED None. ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. The following table sets forth certain information concerning ownership of our common stock as of December 31, 2004. The table discloses each person known to be the beneficial owner of more than five percent (5%) of GOMD common stock. The table also shows the stockholdings of our directors, as well as the shares held by directors and executive officers as a group. The notes accompanying the information in the table below are necessary for a complete understanding of the figures provided. Name and Address Amount and Nature Pct. of Class of Beneficial Owner of Beneficial Ownership Sandra Vernon 1,000,000 4% 2051 Springdale Road Cherry Hill, NJ 08003 William D. Hanna 1,350,000 (1) 5.3% 2051 Springdale Road Cherry Hill, NJ 08003 David Reichman 4,759,000 18.8% 666 Fifth Avenue, Suite 300 New York, NY 10103 Gary Crooks 1,000,000 4% 10329 185th Street South Boca Raton, Florida 33498 Gibson Management, Inc. 1,295,800 5.1% 666 Fifth Ave. Suite 302 New York NY 10103 Frank Benintendo 1,000,000 4% 5005 Long Beach Blvd. Holgate, NJ 08008 Mike Valle 1,000,000 4% 629 Snake Den Rd. West Milford, NJ Executive Officers and Directors as a Group 11,404,800 45.1% (1) Includes 115,000 shares of GOMD common stock which may be acquired upon the exercise of outstanding stock options held by Mr. Hanna. ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. On March 30, 2001, Mr. Hanna provided a non-interest bearing demand loan to the Company of $27,986. See notes to financial statements regarding subsequent events. All monies due to Mr. Hanna have been forgiven in exchange for common stock issued on or about June 27, 2002. Subsequent to such date, Mr. Hanna advanced another $1,200 to the Company as a non- interest bearing loan, which is currently outstanding. Michael Marks, a stockholder, extended an unsecured loan in the amount of $25,000, with interest accrued at 5% per annum, which was due on August 31, 2000. Kevin O'Donnell, a stockholder, extended an unsecured loan in the amount of $50,000, with interest accrued at 10% per annum, which was due December 29, 2000. This note has been discharged by exchange and issuance of 75,000 shares of common stock on or about June 27, 2002. Director and officer, Dr. Leonard F. Vernon resigned his positions with the Company on March 19, 2001 to allow him to resume a more active role with his medical practice. Director William Hanna assumed the additional responsibilities as President, Chief Executive Officer and Chairman of the Board of the Company. Mr. Hanna has been active in the medical field for over eight years. He is currently president of the Able MRI, a magnetic resonance imaging company. The Board of Directors elected two replacement members on April 4, 2001, consisting of Mr. David Reichman and Mr. Gary L. Crooks. Mr. Reichman, after a five year stay with American Express Company, moved on in 1975 to form his own private consulting practice specializing in tax representation and business management. Mr. Crooks is the managing director of a branch office of SAL Financial Services, Inc. Mr. Crooks have more than twenty- five years experience in the financial industry, a third of which were as a senior equity trader at Morgan Stanley. On February 15, 2001, the principal stockholder of the Company agreed to sell up to 550,000 shares of her personal holdings of the Company's common stock to a purchaser chosen by the Board of Directors, the proceeds from which, net of any personal income tax liability arising from this sale, would be paid to the Company as a capital contribution. On May 21, 2003, David Reichman purchased 4,100,000 shares of common stock of the Company for in exchange for services required to meet the reporting obligations of the Company in a private transaction intended to be exempt from the Securities Act of 1933, as amended, pursuant to Section 4(2) thereof. During 2004, David Reichman loaned the Company the total amount of $28,307 for working capital purposes as a non-interest bearing loan. On May 26, 2004 the Board of Directors authorized the issuance of 400,000 shares of the Company's common stock to a marketing and consulting firm and 1,000,000 shares of common stock to Anthony Fiordaisi for joining the board of directors. On July 30, 2004, the Board of Directors authorized the issuance of 1 million shares to each of David Reichman, Chairman, Chief Executive Officer, and stockholder, Gary Crooks, Vice President, director and stockholder, and Anthony Fiordalisi, director and stockholder, as compensation for services rendered to the Company for the period May 1, 2003 through April 30, 2004. The Board of Directors also authorized setting the maximum number of directors at seven members. ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. (continued) On September 17, 2004, the Board of Directors authorized the issuance of 1 million shares to each of Frank Benintendo and Mike Valle as compensation for accepting appointment to the Board of Directors. WHERE ONE CAN FIND MORE INFORMATION The Company files annual, quarterly and special reports, proxy statements and other information with the SEC. One may read and copy any document we file at the SEC's public reference rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. SEC filings are also available to the public over the Internet at the SEC's website at http://www.sec.gov. The SEC allows companies to "incorporate by reference" the information we file with them, which means that they can disclose important information to by referring to those documents. The information incorporated by reference is an important part of this report, and information filed later with the SEC will automatically update or supersede this information. This document may contain summaries of contracts or other documents. Because they are summaries, they will not contain all of the information that may be important. The complete information about a contract or other document may be available as an exhibit to a document incorporated by reference. PART IV ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES FEES BILLED FOR AUDIT AND NON-AUDIT SERVICES The following table represents the aggregate fees billed for professional audit services rendered to the independent auditor, Samuel Klein and Company, CPAs ("Klein & Co.") for our audit of the annual financial statements for the years ended December 31, 2003 and 2004, and all fees billed for other services rendered by Klein & Co. during those periods. Year Ended December 31 2005 2004 - ---------------------- -------------- -------------- Audit Fees (1) $ 5,791 (2) $ 5,500 (2) Audit-Related Fees (2) -- -- Tax Fees (3) -- -- All Other Fees (4) -- -- -------------- -------------- Total Accounting Fees and Services $ 5,791 $ 5,500 (1) Audit Fees. These are fees for professional services for our audit of the annual financial statements, and for the review of the financial statements included in our filings on Form 10-QSB, and for services that are normally provided in connection with statutory and regulatory filings or engagements. (2) Audit-Related Fees. These are fees for the assurance and related services reasonably related to the performance of the audit or the review of our financial statements. (3) Tax Fees These are fees for professional services with respect to tax compliance, tax advice, and tax planning. (4) All Other Fees These are fees for permissible work that does not fall within any of the other fee categories, i.e., Audit Fees, Audit-Related Fees, or Tax Fees. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES (continued) PRE-APPROVAL POLICY FOR AUDIT AND NON-AUDIT SERVICES We do not have a standing audit committee, and the full Board performs all functions of an audit committee, including the pre-approval of all audit and non-audit services before we engage an accountant. All of the services rendered to the Company by Klein & Co. were pre-approved by our Board of Directors. We are presently working with our legal counsel to establish formal pre- approval policies and procedures for future engagements of our accountants. The new policies and procedures will be detailed as to the particular service, will require that the Board or an audit committee thereof be informed of each service, and will prohibit the delegation of pre-approval responsibilities to management. It is currently anticipated that our new policy will provide (i) for an annual pre-approval, by the Board or audit committee, of all audit, audit-related and non-audit services proposed to be rendered by the independent auditor for the fiscal year, as specifically described in the auditor's. engagement letter, and (ii) that additional engagements of the auditor, which were not approved in the annual pre- approval process, and engagements that are anticipated to exceed previously approved thresholds, will be presented on a case-by-case basis, by the President or Controller, for pre-approval by the Board or audit committee, before management engages the auditors for any such purposes. The new policy and procedures may authorize the Board or audit committee to delegate, to one or more of its members, the authority to pre-approve certain permitted services, provided that the estimated fee for any such service does not exceed a specified dollar amount (to be determined). All pre-approvals shall be contingent on a finding, by the Board, audit committee, or delegate, as the case may be, that the provision of the proposed services is compatible with the maintenance of the auditor's independence in the conduct of its auditing functions. In no event shall any non-audit related service be approved that would result in the independent auditor no longer being considered independent under the applicable rules and regulations of the Securities and Exchange Commission. ITEM 15. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (a) Exhibits 14.1 Code of Ethics Incorporated by reference, previously filed on April 25, 2006 Form 10KSB/A-1 31.1 Section 302 Certification of CEO and CFO Included 32.1 Section 906 Certification of CEO and CFO Included (b) The following financial statements of Tree Top Industries, Inc. are included in Part II, Item 7: Independent Auditors' Report Balance Sheet-December 31, 2005 and December 31, 2004 Statements of Operations - years ended December 31, 2005 Statements of Cash Flows - years ended December 31, 2005 Statements of Stockholders' Equity - years ended December 31, 2005 Notes to Financial Statements (c) Reports on Form 8-K. On February 3, 2005, The Company filed an 8-K reporting that its former auditor had resigned. On May 11, 2005, the Company filed an 8-K reporting that Chisholm, Bierwolf and Nilson LLC, Certified Public Accountants had been engaged as the Registrant's independent accountants. The Company filed an 8-K on July 13, 2005. The board of directors of the Registrant voted to approve a one hundred for one reverse stock split. There were no reports on Form 8-K filed with the Commission for the year December 31, 2005. SIGNATURES Pursuant to the requirement of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. TREE TOP INDUSTRIES, INC. Date: July 25, 2006 By: /s/ David Reichman -------------------------------------- David Reichman President and Chairman EX-31 2 ex31_1.txt EXHIBIT 31.1 EXHIBIT 31.1 CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, I, David Reichman, certify that; 1. I have reviewed this Amended Form 10-KSB of Tree Top Industries, Inc.; 2. Based on my knowledge, this amended annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this amended annual report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The small business issuers, other certifying officer(s) and I are responsible for establishing and maintaining disclosure, controls and procedures (as defined in Exchange Act Rules 13a- 15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13-a-15(f) and 15d-15(f)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals; (c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the small business issuer's internal control over financing reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and 5. The small business issuer's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonable likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involved management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: July 25, 2006 /s/David Reichman ------------------------------------------- David Reichman Director, Chief Executive Officer and Chief Financial Officer EX-32 3 ex32_1.txt EXHIBIT 32.1 EXHIBIT 32.1 STATEMENT REQUIRED BY 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Amended Annual Report on Form 10-KSB of Tree Top Industries, Inc. (the "Company") for the year ended, December 31, 2005, as filed with the Securities and "Exchange Commission on the date hereof (the "Report") I, David Reichman, Chief Executive Officer and Chief Financial Officer of the Company, certify that: - - the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and - - information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Date: April 25, 2006 /s/ David Reichman ------------------------------------------- David Reichman Director, Chief Executive Officer and Chief Financial Officer This certification accompanies this Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by t he Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. -----END PRIVACY-ENHANCED MESSAGE-----