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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10KSB

x ANNUAL REPORT PURSUANT
  TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
  For the fiscal year ended August 31, 2003

 ̈ TRANSITION REPORT
  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the transition period from _________ to ____________

Commission File No. 000-33389

AUGUST BIOMEDICAL CORPORATION(Exact name of Registrant as specified in its charter)

|NEVADA                                   | 52-2268239            
|---------------------------------------- | ----------------------
|(State or other jurisdiction of          | (I.R.S. Employer      
|incorporation or organization)           | Identification Number)
|                                         |                       
|1014 Robson Street, P.O. Box 73575,      |                       
|Vancouver, British Columbia, Canada      | V6E 4L9               
|(Address of principal executive offices) | (Zip Code)            

Registrants telephone number, including area code: (604)
  608-3831

Securities registered pursuant to Section 12(b) of the Act:
  none

Securities registered pursuant to Section 12 (g) of the Act:
  100,000,000 common shares par value $0.001 per share

Check whether the issuer (l) has 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. x
  Yes     ̈ No

Check if there is no disclosure of delinquent filers in response
  to Item 405 of Regulation S-B is not 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 any amendment to this Form 10-KSB.  ̈

Revenues for the fiscal year ending August 31, 2003 were $0.00.

The aggregate market value of the voting stock held by non-affiliates
  computed by reference to the last reported sale price of such stock as of January
  14, 2004 is $7,985,250.

The number of shares of the issuers Common Stock outstanding
  as of December 31, 2003 is 12,065,000.

Transitional Small Business Disclosure Format (check one):
  Yes  ̈    No x

1

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PART I

Item 1. Description of Business

Certain statements contained in this Form 10-KSB constitute
  "forward-looking statements" within the meaning of Section 27A of the Securities
  Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities
  Exchange Act of 1934 (the Exchange Act). These statements, identified
  by words such as plan, "anticipate," "believe," "estimate," "should,"
  "expect" and similar expressions, include our expectations and objectives regarding
  our future financial position, operating results and business strategy. These
  statements reflect the current views of management with respect to future events
  and are subject to risks, uncertainties and other factors that may cause our
  actual results, performance or achievements, or industry results, to be materially
  different from those described in the forward-looking statements. Such risks
  and uncertainties include those set forth under the caption "Management's Discussion
  and Analysis or Plan of Operation" and elsewhere in this Form 10-KSB. We do
  not intend to update the forward-looking information to reflect actual results
  or changes in the factors affecting such forward-looking information. We advise
  you to carefully review the reports and documents we file from time to time
  with the Securities and Exchange Commission (SEC), particularly
  our quarterly reports on Form 10-QSB and our current reports on Form 8-K.

As used in this annual report, the terms "we", "us", "our",
  and the company mean August Biomedical Corporation unless otherwise
  indicated. All dollar amounts in this annual report are in U.S. dollars unless
  otherwise stated.

OVERVIEW

The Company is engaged in the business of developing an oil
  and gas project known as the Horizontal Amsden Play in Musselshell
  and Yellowstone Counties, Montana. The Horizontal Amsden Play is based on the
  theory that commercial oil production can be obtained from a formation known
  as the Amsden Formation which occurs in Central Montana using modern horizontal
  drilling technologies. The Company has obtained the right to acquire an interest
  in oil and gas leases covering approximately 12,972 gross leasehold acres (approximately
  9,268 net leasehold acres) from Zone Exploration Inc. (Zone) of
  Billings, Montana as more particularly described below under the heading Agreement
  of Sale & Purchase. Subject to completion of due diligence and obtaining
  financing, the Company proposes to complete the acquisition of the leases from
  Zone and to proceed with development of the Horizontal Amsden Play.

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HISTORY OF BUSINESS OPERATIONS OF THE COMPANY

The Company was incorporated under the laws of the state of
  Nevada on May 26, 2000. Prior to July of 2000, the Companys business activities
  were limited to organization and initial financing. The Company entered into
  an agreement dated July 15, 2000 (the Option Agreement) with John
  MacPherson (MacPherson). Under the terms of the Option Agreement,
  the Company was granted an option to acquire the Flint Mineral Claim in the
  Slocan Mining Division of British Columbia, Canada. The terms of the Option
  Agreement required the Company to make certain payments and complete certain
  exploration work on the Flint Mineral Claim in order to exercise the Option,
  including the making of a $50,000 payment on June 30, 2002. Although the exploration
  work conducted by the Company on the Flint Mineral Claim was encouraging, the
  Company was not able, due to weather conditions, to complete sufficient exploration
  work to permit its geological consultant to recommend the making of the payment
  due June 30, 2002 and MacPherson was not willing it to extend the payment date
  with the result that the Companys option was terminated. Following termination
  of the Option, the Company acquired a proprietary potential technology for cancer
  detection known as the CERVeyorTMTechnology.

The Company acquired the CERVeyorTM Technology
  from Nicolas B MacKinnon (the Vendor) by an agreement dated August
  16, 2002 (the Acquisition Agreement). Under the terms of the Acquisition
  Agreement the Company paid $20,000 (the Purchase Price) to the Vendor
  to acquire the CERVeyorTM Technology. Under the terms of the Acquisition
  Agreement the Vendor had the right to re-acquire the CERVeyorTM Technology
  for the return of the Purchase Price the if the Company failed to complete financing
  to raise net proceeds of $200,000 US within 90 days of the date of the Acquisition
  Agreement (which financing was completed) and a further $800,000 US within 180
  days of the date of the Acquisition Agreement (which financing was not completed).
  Consequently, on June 11, 2003 the Vendor returned the Purchase Price to the
  Company and the Company lost the Technology.

The Company entered into an option agreement dated September
  9, 2002 (the Biomax Option Agreement) with Biomax Technologies (the
  Optionor). Under the terms of the Biomax Option Agreement the Company
  paid $20,000 to acquire an option to acquire United States Patent Number 6,021,344,
  a patent covering a fluorescence scope system for dermatologic diagnosis (the
  ORALview Technology). In order to exercise the option the Company
  was required to pay $180,000 US to the Optionor on or before January 30, 2003.
  The Company borrowed $200,000 from 648613 B.C. Ltd (the Lender)
  to permit it to exercise the Option. The Company was unable to repay the loan
  when required and the Lender exercised its right under the terms of a Loan and
  Security Agreement dated July 9, 2003 to cause the Company to convey the ORALview
  Technology to the Lender in satisfaction of the loan.

By an agreement dated December 15, 2003 the Company acquired
  the right to purchase the leases comprising the Horizontal Amsden Play.

3

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GLOSSARY OF TERMS

|Gross leased acre:    | A leased acre in which a working interest is owned,
        without regard to the size of the interest.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|--------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Leases:               | Full or partial leasehold interests in oil and gas
        prospects, authorizing the owner thereof to drill for, reduce to possession
        and produce and sell oil and gas, subject to the payment of rentals, bonuses
        and/or royalties.                                                                                                                                                                                                                                                                                                                                                                      
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Horizontal Drilling:  | directional drilling where the departure from the
        well vertical exceeds 80 degrees. Horizontal drilling permits intersection
        with the target zone over a greater distance offering potential for enhanced
        production.                                                                                                                                                                                                                                                                                                                                                                              
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Net leased acres:     | One net leased acre is deemed to exist when the sum
        of the fractional working interests owned in gross acres equals one. The
        number of net acres is the sum of the fractional working interests owned
        in gross acres.                                                                                                                                                                                                                                                                                                                                                                              
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Net Revenue Interest: | That percent of the production revenue allocated
        to the working interest after first deducting proceeds allocated to royalty
        interests.                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Working Interest :    | A working interest in an oil or gas property
        is one that is burdened with the cost of development and operation of
        the property, such as the responsibility to share expenses of drilling
        completed or operating oil and gas property, according to working or operating
        mineral interest in any tract or parcel of land. Rights to overriding
        royalties, production payments, and the like do not constitute working
        interests because they are not burdened with the responsibility to share
        expenses of drilling, completing, or operating oil and gas property.

AGREEMENT FOR SALE & PURCHASE

Pursuant to an agreement dated December 15, 2003 and executed
  December 18, 2003 (the Agreement) between the Company and Zone the
  Company acquired the right to purchase a 100% working interest (82% net revenue
  interest) in oil and gas leases covering approximately 12,972 gross leasehold
  acres (approximately 9,268 net leasehold acres) in Musselshell and Yellowstone
  counties of the State of Montana (more particularly described below under the
  heading Description of Property) which comprise the Horizontal Amsden
  Play. Under the terms of the Agreement the total purchase price is $185,366
  (the Purchase Price) payable as follows:

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| | a. | $20,000 initial deposit on execution
        of the Agreement (which sum has been paid); and                 
| | -- | -------------------------------------------------------------------------------------------------------------
| | b. | the balance of $165,366 60 days following
        the date of execution of the Agreement (February 16, 2004).

During the 60 day period prior to payment of the balance the
  Company will complete its due diligence to confirm title to the leases and the
  feasibility of the play.

In the event that the Company determines to proceed with the
  acquisition following completion of its due diligence, the Company will be obligated
  to make project expenditures totaling $3,325,000 (the Project Expenditures)
  over a two year period as follows:

|YEAR 1              | Amount        | Purpose                        
|------------------- | ------------- | -------------------------------
|                    |               |                                
|March 17, 2004      | $300,000.00   | Acquisition of additional      
|                    |               | Prospect leases (15,000 acres) 
|                    |               |                                
|April 16, 2004      | $200,000.00   | Acquisition of additional      
|                    |               | Prospect leases (10,000 acres) 
|                    |               |                                
|                    | $300,000.00   | Negotiations and Purchase      
|                    |               | of existing vertical oil well  
|                    |               | properties (2-6 wells possible)
|                    |               |                                
|June 15, 2004       | $300,000.00   | Acquisition of additional      
|                    |               | Prospect leases (15,000 acres) 
|                    |               |                                
|                    | $200,000.00   | 3-D seismic survey at          
|                    |               | Wolf Springs field             
|                    |               |                                
|October 13, 2004    | $1,200,000.00 | Drilling participation budget  
|                    |               | For 1, 2 or 3-well program     
|                    |               |                                
|YEAR 2              | Amount        | Purpose                        
|                    |               |                                
|First 9 months      | $750,000.00   | Drilling participation budget  
|                    |               | For additional drilling        
|                    |               |                                
|                    | $75,000.00    | 2ndyear lease rentals          
|                    |               |                                
|                    |               |                                
|TOTAL 2-YR. BUDGET: | $3,325,000.00 |                                

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In order to make payment of the balance of the Purchase Price
  and make the Project Expenditures, the Company will need to obtain funding either
  through the sale of its equity securities or by borrowing or by joint venturing
  its interests with other parties. At this point the Company does not have an
  equity or debt financing arranged and has not identified any potential joint
  venture parties. There is no assurance that financing or joint venture funding
  will be available to the Company.

In the event that the Company defaults in the payment of any
  portion of the Purchase Price and fails to cure such default within 14 days
  of notice from Zone, it will be subject to forfeiture of its interest to Zone.

In the event that the Company defaults in making any required
  Project Expenditures, the default will be covered by the applicable operating
  agreement which typically provides for the party in default to be obligated
  to pay the other parties with interest or to suffer the dilution of their interest
  on an accelerated basis if the other parties are forced to advance their share
  of expenditures.

The leases will be subject to royalties in favor or Zone and
  the landowners totaling 18% so that the Company will obtain an 82% net revenue
  interest.

Under the terms of the Agreement the Company will enter into
  an area of mutual interest agreement (the AMI Agreement) with Zone.
  The AMI Agreement will provide for how the parties will deal with leasehold
  interests acquired within a defined area of interest in the general area of
  the currently held leases (the Area of Mutual Interest). The AMI
  Agreement will have a term of five years. Under the terms of the AMI Agreement
  Zone will be obligated to offer to the Company any leases that it acquires within
  the Area of Mutual Interest at a fixed price of $20.00 per acre subject to an
  overriding royalty in favor of Zone equal to the lesser of 3% of net revenue
  or the difference between existing lease burdens and 80% net revenue interest.
  If the Company acquires any leases within the Area of Mutual Interest it will
  assign to Zone a royalty of the lesser of 3% or the difference between existing
  lease burdens and 80% net revenue.

Under the terms of the Agreement the Company will also enter
  into a brokerage agreement with Zone (the Brokerage Agreement).
  The terms of the Brokerage Agreement will require the Company to retain Zone
  to act as its broker with respect to the acquisition of additional oil and gas
  leases in the Horizontal Amsden Play area. The Company will pay Zone $350 per
  day plus reimbursement of expenses for work done under the Brokerage Agreement.

History of Horizontal Amsden Play

The Horizontal Amsden Play was developed by Zone. It gathered
  the prospect ideas of three geologists with experience in the area into the
  synthesis of a regional play. The play comprises eight separate prospects, five
  of which offset or lie within fields with wells currently producing from the
  Amsden zone. Wells producing from the Amsden formation have yielded some of
  the most prolific production in the State of Montana. The play is based on the
  assumption that

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modern horizontal drilling techniques have the potential to
  allow greater production than from vertical holes.

COMPETITION

Our competitors include major oil companies and other independent
  operators, most of which have financial resources, staffs and facilities substantially
  greater than ours. Competition in the oil and gas industry is intense. We also
  face intense competition in obtaining capital for drilling and acquisitions
  and are at a competitive disadvantage compared with larger companies.

EMPLOYEES

We have no employees as of the date of this Annual Report
  other than our three officers. We conduct our business largely through agreements
  with consultants and arms-length third parties.

SUBSIDIARIES

We have one wholly-owned British Columbia subsidiary, named
  August Research Corp.

GOVERNMENT REGULATION

The production and sale of oil and gas are subject to various
  federal, state and local governmental regulations, which may be changed from
  time to time in response to economic or political conditions. Matters subject
  to regulation include discharge permits for drilling operations, drilling bonds,
  reports concerning operations, the spacing of wells, unitization and pooling
  of properties, taxation and environmental protection. From time to time, regulatory
  agencies have imposed price controls and limitations on production by restricting
  the rate of flow of oil and gas wells below actual production capacity in order
  to conserve supplies of oil and gas. Changes in these regulations could have
  a material adverse effect on the company.

RESEARCH AND DEVELOPMENT

The Company made no expenditures on research and development
  in the fiscal years ended August 31, 2003 and August 31, 2002. The Company does
  not anticipate making any expenditures on research and development in the next
  12 months.

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INVESTMENT RISKS

An investment in our common stock involves a high degree of
  risk. If you are considering investing in our Company, you should carefully
  consider the risks described below and other risks inherent in doing business
  before investing in our common stock. If any of the following risks or other
  risks occur, our business, operating results and financial condition could be
  seriously harmed. The trading price of our common stock could decline due to
  any of these or other risks.

The Companys exploration project is in development
  and as such the Company has no current revenues and will incur losses for the
  foreseeable future.

We are currently initiating our business plan. Accordingly,
  we have a limited operating history upon which to base an evaluation of our
  business and prospects. We have not as yet generated revenues from operations.
  The development of our exploration project to the point necessary to achieve
  commercial production will take a significant additional investment in capital.
  Accordingly, we will continue to incur losses for some time to come. We may
  not successfully implement all or any of our business strategies or successfully
  address the risks and uncertainties that we encounter.

If we are unable to raise the necessary funding, as required,
  to finalize the acquisition of the Horizontal Amsden Play and for Project Expenditures,
  we will not be able to complete our Business Plan.

As of November 30, 2003, we had a working capital deficiency
  of $75,798. We project that we need to raise approximately $2,860,000 in order
  to execute our business plan over the next 12 months. We currently do not have
  any firm commitments for financing and we may not be able to obtain financing
  in which event it will be unlikely that we will be able to pursue our business
  operations. An immediate financial need is a payment for the acquisition of
  the Horizontal Amsden Play in the amount of $165,366 due on February 16, 2004.
  This payment must be made by the Company if the Company is to acquire the Horizontal
  Amsden Play. Obtaining financing for this and other purposes will depend upon
  a number of factors, including the market for financing oil and gas startups
  and the attractiveness of our business plan to investors. These factors may
  make the timing, amount, terms or conditions of additional financing unavailable
  to us.

Because our officers and directors own a significant number
  of shares of our common stock, they may control all major corporate decisions,
  and our other stockholders may not be able to influence these decisions.

Our officers and directors own approximately 39% of the outstanding
  shares of our common stock. Accordingly, they will have the control necessary
  to influence the outcome of all corporate transactions or other matters, including
  the election of the directors. The interests of the officers and directors may
  differ from the interests of the other stockholders.

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Our common stock is penny stock, with the result
  that trading of our common stock in any secondary market is impeded.

The SEC has adopted rules that regulate broker-dealer practices
  in connection with transactions in penny stocks. Penny stocks are generally
  equity securities with a price of less than $5.00, other than securities registered
  on certain national securities exchanges or quoted on the Nasdaq system, provided
  that current price and volume information with respect to transactions in such
  securities is provided by the exchange or system. The penny stock rules require
  a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized
  risk disclosure document prepared by the Commission, that: (a) contains a description
  of the nature and level of risk in the market for penny stocks in both public
  offerings and secondary trading; (b) contains a description of the broker's
  or dealer's duties to the customer and of the rights and remedies available
  to the customer with respect to a violation to such duties or other requirements
  of Securities' laws; (c) contains a brief, clear, narrative description of a
  dealer market, including bid and ask prices for penny stocks and the significance
  of the spread between the bid and ask price; (d) contains a toll-free telephone
  number for inquiries on disciplinary actions; (e) defines significant terms
  in the disclosure document or in the conduct of trading in penny stocks; and
  (f) contains such other information and is in such form, including language,
  type, size and format, as the Commission shall require by rule or regulation.
  The broker-dealer also must provide, prior to effecting any transaction in a
  penny stock, the customer with: (a) bid and offer quotations for the penny stock;
  (b) the compensation of the broker-dealer and its salesperson in the transaction;
  (c) the number of shares to which such bid and ask prices apply, or other comparable
  information relating to the depth and liquidity of the market for such stock;
  and (d) a monthly account statements showing the market value of each penny
  stock held in the customer's account. In addition, the penny stock rules require
  that prior to a transaction in a penny stock not otherwise exempt from those
  rules; the broker-dealer must make a special written determination that the
  penny stock is a suitable investment for the purchaser and receive the purchaser's
  written acknowledgment of the receipt of a risk disclosure statement, a written
  agreement to transactions involving penny stocks, and a signed and dated copy
  of a written suitability statement. These disclosure requirements may have the
  effect of reducing the trading activity in the secondary market for our stock.

Additional Risks

In addition to the other factors set forth in this Report,
  investors should be aware of the following factors which may affect our business,
  results of operations and/or financial condition in the future:

Substantially all of our investment is tied up in one property,
  and if that prospect is not productive of oil or natural gas, we will be forced
  to seek additional opportunities. Substantially all of our current capital investment
  is tied up in the Horizontal Amsden Play. Since this prospect is not currently
  developed, we are dependent on being able to prove production for additional
  cash flow. If we are unable to prove that such prospect can be productive of
  oil and natural gas, we will be forced to seek additional investments. Investigating

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and locating suitable property for acquisition is expensive
  and time consuming. Even if we are successful in identifying one or more additional
  properties for acquisition, there is no assurance that we can obtain such property
  at reasonable prices or that sufficient working capital will be available. Our
  dependence on a single prospect property for cash flow increases the risk of
  our future success.

Operations will be effected by future oil and natural gas
  prices that fluctuate widely, and low prices could have a material adverse effect
  on future operations. Our future success will depend largely on the prices received
  for natural gas and oil production. Prices received also will affect the amount
  of future cash flow available for capital expenditures and may affect the ability
  to raise additional capital. Lower prices may also affect the amount of natural
  gas and oil that can be economically produced from reserves either discovered
  or acquired.

Prices for natural gas and oil fluctuate widely. For example,
  natural gas and oil prices declined significantly in 1998 and 2001, and, for
  an extended period of time, remained below prices obtained in previous years.
  Factors that can cause price fluctuations include:

The level of consumer product demand;
    Weather conditions;
    Domestic and foreign governmental regulations;
    The price and availability of alternative fuels;
    Political conditions in natural gas and oil producing regions;
    The domestic and foreign supply of natural gas and oil;
    The price of foreign imports; and
    Overall economic conditions.


We are in the oil and natural gas business that involves many
  operating risks that can cause substantial losses. The oil and natural gas business
  involves a variety of operating risks, including:

Fires;
    Explosions;
    Blow-outs and surface cratering;
    Uncontrollable flows of underground natural gas, oil or formation water;


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- Natural disasters;
- Pipe and cement failures;
- Casing collapses;
- Embedded oilfield drilling and service tools;
- Abnormal pressure formations; and
- Environmental hazards such as natural gas leaks, oil
      spills, pipeline ruptures or discharges of toxic gases.

If any of these events occur, we could incur substantial losses
  as a result of:

Injury or loss of life;
    Severe damage to and destruction of property, natural resources or equipment;
    Pollution and other environmental damage;
    Clean-up responsibilities;
    Regulatory investigation and penalties;
    Suspension of our operations; or
    Repairs necessary to resume operations.


If we were to experience any of these problems, it could affect
  well bores, gathering systems and processing facilities, any one of which could
  adversely affect the companies' ability to conduct operations. For some risks,
  we may not obtain insurance if we believe the cost of available insurance is
  excessive relative to the risks presented. In addition, pollution and environmental
  risks generally are not fully insurable. If a significant accident or other
  event occurs and is not fully covered by insurance, it could adversely affect
  operations. Moreover, we cannot assure the shareholders that we will be able
  to maintain adequate insurance in the future at rates considered reasonable.

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Item 2. Description of Property

The Company presently does not own any material property and
  has no plants. If the Company completes its planned purchase of the Horizontal
  Amsden Play it will hold a 100% working interest (82% net revenue interest)
  in the following leases:

Oil and Gas Leases  Musselshell and Yellowstone Counties, Montana (USA)

|Lessors | Lessee/Lease Date/ | Land Description/ |          
|------- | ------------------ | ----------------- | ---------
|        | Term Length        | Net Acres         | Recording

North Mason Lake and Stag-Summit Prospects

|State of Montana | John Fredlund          | Township 10 North, Range 24 East        
|---------------- | ---------------------- | ----------------------------------------
|(34,875-02)      | 12-3-2002              | Section 36: All                         
|                 | 10 years               |                                         
|                 |                        | Containing 640.0 acres, more or less.   
|                 |                        | Musselshell Co., Montana                
|                 |                        | (640.0 net acres)                       
|                 |                        |                                         
|John Fredlund,   | Zone Exploration, Inc. | Township 9 North, Range 24 East         
|et uxBess Snyder | 9-1-2003               | Section 2: S2                           
|                 | 5 years                | Section 11: Lots 1-4, N2S2, N2          
|                 |                        | Section 12: E2, SW                      
|                 |                        |                                         
|                 |                        | Containing 1,402.46 acres, more or less.
|                 |                        | Musselshell Co., Montana                
|                 |                        | (105.90 net acres)                      
|                 |                        |                                         
|John Fredlund,   | Zone Exploration, Inc. | Township 9 North, Range 25 East         
|et uxBess Snyder | 9-1-2003               | Section 19: Lots 1, 2, E2NW             
|                 | 5 years                |                                         
|                 |                        | Containing 161.40 acres, more or less.  
|                 |                        | Musselshell Co., Montana                
|                 |                        | (20.18 net acres)                       
|                 |                        |                                         
|State of Montana | John Fredlund          | Township 9 North, Range 25 East         
|(34,872-02)      | 12-3-2002              | Section 16: All                         
|                 | 10 years               |                                         
|                 |                        | Containing 640.0 acres, more or less.   
|                 |                        | Musselshell Co., Montana                
|                 |                        | (640.0 net acres)                       

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|AgAmerica, FCB   | John Fredlund          | Township 9 North, Range 25 East          | Book 373
|---------------- | ---------------------- | ---------------------------------------- | --------
|(FCB 01-0164)    | 5-10-2001              | Section 9: S2                            | Page 707
|                 | 5 years                |                                          |         
|                 |                        | Containing 320.0 acres, more or less.   
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (160.0 net acres)                        |         
|                 |                        |                                          |         
|AgAmerica, FCB   | John Fredlund          | Township 9 North, Range 25 East          | Book 385
|(FCB 02-0161)    | 12-9-2002              | Section 17: All                          | Page 164
|                 | 5 years                |                                          |         
|                 |                        | Containing 640.0 acres, more or less.   
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (320.0 net acres)                        |         
|                 |                        |                                          |         
|Bryan W. Adolph, | Zone Exploration, Inc. | Township 9 North, Range 25 East          | Book 385
|et uxKathy J.    | 9-15-2003              | Section 7: Lots 3, 4, E2SW, NE           | Page 687
|                 | 7 years                | Section 8: W2W2                          |         
|                 |                        | Section 15: W2                           |         
|                 |                        | Section 17: W2                           |         
|                 |                        | Section 18: NE                           |         
|                 |                        | Section 22: SE                           |         
|                 |                        |                                          |         
|                 |                        | Containing 1,442.08 acres, more or less.
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (1,091.95 net acres)                     |         
|                 |                        |                                          |         
|USA              | John Fredlund          | Township 9 North, Range 25 East          |         
|(MTM-85136)      | 7-1-1996               | Section 10: All                          |         
|                 | 10 years               | Section 15: E2                           |         
|                 |                        | Section 22: N2NW                         |         
|                 |                        |                                          |         
|                 |                        | Containing 1,040.0 acres, more or less. 
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (1,040.0 net acres)                      |         
|                 |                        |                                          |         
|USA              | John Fredlund          | Township 9 North, Range 25 East          |         
|(MTM-85137)      | 7-1-1996               | Section 18: SE                           |         
|                 | 10 years               | Section 19: E2                           |         
|                 |                        | Section 20: All                          |         
|                 |                        |                                          |         
|                 |                        | Containing 1,120.0 acres, more or less. 
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (1,120.0 net acres)                      |         
|                 |                        |                                          |         
|USA              | John Fredlund          | Township 9 North, Range 25 East          |         
|(MTM-85370)      | 7-1-1996               | Section 22: NE, S2NW                     |         
|                 | 10 years               |                                          |         
|                 |                        | Containing 240.0 acres, more or less.   
|                 |                        | Musselshell Co., Montana                 |         
|                 |                        | (240.0 net acres)                        |         

13

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|USA                | John Fredlund                          | Township 9 North, Range 25 East
|------------------ | -------------------------------------- | -------------------------------
|(MTM-85545)        | 9-1-1996                               | Section 22: SW                 
|                   | 10 years                               |                                
|                   | Containing 160.0 acres, more or less. 
|                   | Musselshell Co., Montana              
|                   | (160.0 net acres)                     
|Conoco Prospect    |                                       
|State of Montana   | John Fredlund                          | Township 9 North, Range 25 East
|(34,873-02)        | 12-3-2002                              | Section 36: All                
|                   | 10 years                               |                                
|                   | Containing 640.0 acres, more or less. 
|                   | Musselshell Co., Montana              
|                   | (640.0 net acres)                     
|Gage Dome Prospect |                                       
|USA                | John Fredlund                          | Township 9 North, Range 26 East
|(MTM-85735)        | 11-1-1996                              | Section 8: SE                  
|                   | 10 years                               | Section 14: SESE               
|                   | Section 18: Lots 1, 2                 
|                   |                                       
|                   | Containing 282.89 acres, more or less.
|                   | Musselshell Co., Montana              
|                   | (282.89 net acres)                    
|                   |                                        |                                
|USA                | John Fredlund                          | Township 9 North, Range 26 East
|(MTM-84837)        | 2-1-1996                               | Section 21: All                
|                   | 10 years                               |                                
|                   | Containing 640.0 acres, more or less. 
|                   | Musselshell Co., Montana              
|                   | (640.0 net acres)                     
|Delphia Prospect   |                                       
|State of Montana   | John Fredlund                          | Township 9 North, Range 27 East
|(34,874-02)        | 12-3-2002                              | Section 36: All, excpt RR r/w  
|                   | 10 years                               |                                
|                   | Containing 613.50 acres, more or less.
|                   | Musselshell Co., Montana              
|                   | (613.50 net acres)                    
|                   |                                        |                                
|USA                | John Fredlund                          | Township 9 North, Range 27 East
|(MTM-85736)        | 11-1-1996                              | Section 21: E2                 
|                   | 10 years                               | Section 22: SWNE, S2NW, SW     
|                   |                                       
|                   | Containing 600.0 acres, more or less. 
|                   | Musselshell Co., Montana              
|                   | (600.0 net acres)                     

14

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|Hawk Creek Prospect                     |                                          |                                  
|--------------------------------------- | ---------------------------------------- | ---------------------------------
|John Fredlund,                          | Zone Exploration, Inc.                   | Township 8 North, Range 29 East  
|et uxBess Snyder                        | 9-1-2003                                 | Section 2: Lots 13-20            
|                                        | 5 years                                  |                                  
|                                        | Township 8 North, Range 30 East          |                                  
|                                        | Section 6: Lots 4, 5, 12, 13, 20, 21,    |                                  
|                                        | 25, 26, E2SW, W2SE, NESE                 |                                  
|                                        | Section 18: Lots 1-4, E2W2, E2           |                                  
|                                        |                                          |                                  
|                                        | Containing 1,429.81 acres, more or less. |                                  
|                                        | Musselshell Co., Montana                 |                                  
|                                        | (89.91 net acres)                        |                                  
|Wolf Springs Prospect                   |                                          |                                  
|Charles Ruthern Horton,                 | Reger Oil, Inc.                          | Township 7 North, Range 32 East  
|aka Charles R. Horton                   | 6-22-2000                                | Section 19: Lots 2-4, SENW, S2NE,
|aka Charley R. Horton                   | 5 years                                  | E2SW, SE                         
|                                        | Section 30: E2                           |                                  
|                                        |                                          |                                  
|                                        | Containing 800.0 acres, more or less.    |                                  
|                                        | Yellowstone Co., Montana                 |                                  
|                                        | (152.0 net acres)                        |                                  
|                                        |                                          |                                  
|Charles Rockwood Horton Reger Oil, Inc. | Township 7 North, Range 32 East          | Doc No.                          
|aka Charles Rocky Horton 8-3-2000       | Section 19: Lots 2-4, SENW, S2NE,        | 3264951                          
|                                        | 5 years                                  | E2SW, SE                         
|                                        | Section 30: E2                           |                                  
|                                        |                                          |                                  
|                                        | Containing 800.0 acres, more or less.    |                                  
|                                        | Yellowstone Co., Montana                 |                                  
|                                        | (48.0 net acres)                         |                                  
|                                        |                                          |                                  
|Jeffrey D. Horton,                      | Reger Oil, Inc.                          | Township 7 North, Range 32 East  
|Personal Representative                 | 7-24-2000                                | Section 19: Lots 2-4, SENW, S2NE,
|of the Estate of                        | 5 years                                  | E2SW, SE                         
|Roland Dean Horton,                     | Section 30: E2                           |                                  
|deceased                                |                                          |                                  
|                                        | Containing 800.0 acres, more or less.    |                                  
|                                        | Yellowstone Co., Montana                 |                                  
|                                        | (184.0 net acres)                        |                                  

The leases cover approximately 12,972 gross acres (9,268 net acres).

The leases are subject to royalties totaling 18% in favor of the landowners and Zone.

15

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Item 3. Legal Proceedings

Claim by Peter Whitehead

The Company and its subsidiary August Research Corp. are the
  subject of a legal proceeding commenced in the Supreme Court of British Columbia
  on July 24, 2003 by Peter Whitehead, a former director and officer of the Company.
  Mr. Whitehead claims against the Company for reimbursement of expenses totaling
  $40,670, an unspecified value of 200,000 stock options which he claims to be
  entitled to, an order for delivery of 1,500,000 common shares of the Company
  which he claims he was offered as an inducement to enter into employment contract
  in June of 2002 with the Company and for unspecified damages and costs for breach
  of the contract. The Company is defending the action and takes the position
  that Mr. Whitehead voluntarily resigned or refused to carry out his duties under
  the employment contract and is therefore not entitled to the remedies sought.
  The Company claims that the 1,500,000 shares were registered in the name of
  Mr. Whitehead on the understanding that he would continue to serve the Company
  and that he is now not entitled to the shares because of his voluntary termination
  of his employment contract.

Possible Claim by iCyberdata Technology Inc.

The Company is aware of a possible claim by iCyberdata in
  respect of a memorandum of undertaking (the MOI) dated July 24,
  2003 and a share purchase agreement dated September 30, 2003 (the Share
  Purchase Agreement). The Company was contemplating the purchase of the
  shares of iCyberdata from the shareholders of iCyberdata. In furtherance of
  the proposed purchase, the Company entered into the MOI and executed a copy
  of the Share Purchase Agreement. The Company takes the position that he MOI
  was intended to be a non-binding letter of intent only and that the Share Purchase
  Agreement entered into by the Company was not to be binding on the Company until
  it was executed by the shareholders of iCyberdata and its final form was approved
  by legal counsel for the Company neither of which events ever occurred. iCyberdata,
  by letter dated October 29, 2003 claimed to terminate the Agreement and has
  demanded $75,000 from the Company under the terms of the alleged agreement.
  In subsequent correspondence iCyberdata continues to allege that the Company
  is required to advance them $10,000 per month in respect of the alleged agreement
  terminated by their letter of October 29, 2003. No legal action has yet been
  commence by iCyberdata and the Company intends to vigorously defend any action
  that may be commenced on the basis that it has no legal obligations to iCyberdata.

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

There were no matters submitted to a vote of the shareholders
  during the fourth quarter of the fiscal year ended August 31, 2003.

16

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Part II

Item 5. Market for Registrants Common Equity and Related Stockholders Matters

Market Information

Our shares are currently trading on the OTC Bulletin Board
  under the stock symbol AGBM. The listing was obtained on May 16, 2002. The high
  and the low prices for our shares for each quarter of our last two fiscal years
  since the shares commenced trading were:

|Fiscal Quarter Ended | High  | Low  
|-------------------- | ----- | -----
|August 31, 2002      | $4.75 | $0.35
|November 30, 2002    | $6.90 | $2.75
|February 28, 2003    | $7.40 | $3.00
|May 31, 2003         | $4.05 | $1.65
|August 31, 2003      | $0.90 | $0.41
|November 30, 2003    | $0.49 | $0.41

The source of the high and low bid price information is the
  OTC Bulletin Board. The market quotations provided reflect inter-dealer prices,
  without retail mark-up, markdown or commission and may not represent actual
  transactions.

Holders of Common Stock

As of the date of this report, there were 21 registered shareholders
  of our common stock.

Dividends

There are no restrictions in our Articles of Incorporation
  or bylaws that restrict us from declaring dividends. The Nevada Revised Statutes,
  however, prohibit us from declaring dividends where, after giving effect to
  the distribution of the dividend:

| | (A) | we would not be able to pay our debts
        as they become due in the usual course of business; or                                                                                                                                               
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (B) | our total assets would be less than
        the sum of our total liabilities, plus the amount that would be needed
        to satisfy the rights of shareholders who have preferential rights superior
        to those receiving the distribution.

We have neither declared nor paid any cash dividends on our
  capital stock and do not anticipate paying cash dividends in the foreseeable
  future. Our current policy is to retain any earnings in order to finance the
  expansion of our operations. Our board of directors will determine future declaration
  and payment of dividends, if any, in light of the then-current conditions they
  deem relevant and in accordance with the Nevada Revised Statutes.

17

---

Recent Sales of Unregistered Securities

We have not completed any sales of unregistered securities
  during the period covered by this report not previously reported in Form 10-QSB.

During the year ended August 31, 2003 the Company received
  subscriptions from two subscribers who represented that they were accredited
  investors for the purchase of 10,000 common shares of the Company at $2.00 per
  share pursuant to Rule 506 of Regulation D. In view of the changes in the Companys
  business the directors are reviewing whether it is appropriate to proceed with
  the private placement at $2.00 per share and may decline the subscriptions and
  or seek to have the subscribers purchase a different number of shares at a different
  price after full disclosure of changes to the subscribers. In the event the
  Company does not proceed with a private placement with the subscribers it will
  be liable to return the subscription funds to them.

Item 6. Managements Discussion and Analysis or Plan
  of Operation

Plan of Operations:

During the next 12 months the Companys plan of operations
  is to complete the acquisition of the Horizontal Amsden Play and to make the
  Project Expenditures as detailed under the heading Purchase & Sale
  Agreement under Item 1 Business of the Company above. The
  expenditures involved are detailed as follows:

|a. | completion of acquisition of Horizontal Amsden Play         | $ | 165,366   | 
|-- | ----------------------------------------------------------- | - | --------- | 
|b. | acquisition of additional leases in Area of Mutual Interest | $ | 800,000   | 
|c. | purchase of 2 to 6 producing vertical oil wells             | $ | 300,000   | 
|d. | completion of 3-D seismic surveys                           | $ | 200,000   | 
|e. | one to three well drilling program                          | $ | 1,200,000 | 
|   |                                                             |   |           | 
|   | Total:                                                      | $ | 2,665,366 | 

These planned expenditures are subject to the Company successfully
  completing its due diligence and proceeding with the acquisition of the Amden
  Horizontal Play. The exact amount of expenditures under each item will depend
  on the success of negotiations and recommendations of professional consultants
  to be retained to review and develop exploration programs. In addition, any
  expenditures are subject to the Company obtaining sufficient financing. At November
  30, 2003 the Company had a working capital deficiency of $75,798. The Company
  will require significant financing to complete the acquisition of the Amden
  Horizontal Play and to pay the Project Expenditures detailed above. The Company
  will seek to obtain such financing through borrowing or sale of its equity shares.
  At the present time the Company does not have any debt or equity financing arranged
  and there is no assurance that any will be available. Accordingly, there is
  a significant risk that the Company will not be able to complete its business
  plan.

18

---

In addition to the planned expenditures set out above the
  Company will require funding for general corporate purposes including legal,
  audit and administrative expenses. The Company estimates that at least $100,000
  will be required for such purposes during the next 12 months. At the present
  time, the Company does not have any funding available to meet such expenses
  and will need to obtain loans or sell equity shares to continue to meet its
  filing obligations. There is no assurance that such funding will be available
  to the Company.

At the present time the Company cannot satisfy its immediate
  cash requirements.

The Company does not presently have any employees other than
  its two executive officers and does not anticipate having any employees within
  the next 12 months.

OFF-BALANCE SHEET ARRANGEMENTS

We have no significant off-balance sheet arrangements that
  have or are reasonably likely to have a current or future effect on our financial
  condition, changes in financial condition, revenues or expenses, results of
  operations, liquidity, capital expenditures or capital resources that is material
  to stockholders.

CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in conformity with
  United States generally accepted accounting principles requires our management
  to make estimates and assumptions that affect the reported amount of assets
  and liabilities and disclosure of contingent assets and liabilities at the date
  of the financial statements and the reported amounts of revenues and expenses
  during the reporting period. Actual results could differ from those estimates.
  Our management routinely makes judgments and estimates about the effects of
  matters that are inherently uncertain.

We have identified certain accounting policies, described
  below, that are most important to the portrayal of our current financial condition
  and results of operations. Our significant accounting policies are disclosed
  in Note 2 to the consolidated financial statements included in this annual report.

19

---

Foreign Currency Translation

Our functional currency is the U.S. dollar. Transactions in
  foreign currency are translated into U.S. dollars as follows:

| | 1. | Monetary items at the rate prevailing at the balance sheet
      date;                          
| | -- | ------------------------------------------------------------------------------------------------
| | 2. | Non-monetary items at the historical exchange rate; and                                         
| | 3. | Revenue and expense at the average rate in effect during
      the applicable accounting period.

Income Taxes

We have adopted Statement of Financial Accounting Standards
  No. 109  Accounting for Income taxes (SFAS 109). This standard
  requires the use of an asset and liability approach for financial accounting,
  and reporting on income taxes. If it is more likely than not that some portion
  or all of a deferred tax asset will not be realized, a valuation allowance is
  recognized.

Oil & Gas Payments and Exploration Costs

We plan to adopt the following policy relating to our new
  acquisition of the Horizontal Amsden Play:

We will expense all costs related to the acquisition, maintenance
  and exploration of oil and gas leases in which we have secured exploration rights
  prior to establishment of proven and probable reserves. To date, we have not
  established the commercial feasibility of our exploration prospects, therefore,
  all costs will be expensed.

20

---

Item 7. Financial Statements

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)



21

---




INDEPENDENT AUDITORS' REPORT

To the Shareholders of 
  August Biomedical Corporation 
  (Formerly Coyote Ventures Corp.) 
  (A development stage company)

We have audited the consolidated balance sheets of August
  Biomedical Corporation (formerly Coyote Ventures Corp.) (a development stage
  company) as at August 31, 2003 and 2002, and the consolidated statements of
  loss, cash flows, and stockholders equity for each of the two years then
  ended August 31, 2003, and for the period from inception, May 26, 2000, to August
  31, 2003. These consolidated 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 audits in accordance with auditing standards
  generally accepted in the United States of America. Those standards require
  that we plan and perform an audit to obtain reasonable assurance whether the
  financial statements are free of material misstatement. An audit includes examining,
  on a test basis, evidence supporting the amounts and disclosures in the financial
  statements. An audit also includes assessing the accounting principles used
  and significant estimates made by management, as well as evaluating the overall
  financial statement presentation. We believe that our audit provides a reasonable
  basis for our opinion.

In our opinion, these consolidated financial statements referred
  to above present fairly, in all material respects, the financial position of
  the Company as at August 31, 2003 and 2002, and the results of its operations
  and cash flows for the periods indicated in conformity with accounting principles
  generally accepted in the United States of America.

The accompanying financial statement have been prepared assuming
  the Company will continue as a going concern. As discussed in Note 1(c) to the
  financial statements, the Company incurred a net loss of $625,797 since inception,
  has not attained profitable operations and is dependent upon obtaining adequate
  financing to fulfil its development activities. These factors raise substantial
  doubt that the Company will be able to continue as a going concern. Managements
  plans in regard to these matters are also discussed in Note 1(c). The financial
  statements do not include any adjustments that might result from the outcome
  of this uncertainty.

|Vancouver, B.C.                         | Morgan & Company   
|--------------------------------------- | ---------------------
|                                        |                      
|November 24, 2003, except as to Note 10 | Chartered Accountants
|which is as December 15, 2003.          |                      

|Tel: (604) 687-5841 |                                     | P.O. Box 10007 Pacific Centre
|------------------- | ----------------------------------- | -----------------------------
|fax: (604) 687-0075 | Sute 1488 - 700 West Georgia Street
|www.morgan-cas.com  | Vancouver, B.C. V7Y 1A1            

---

AUGUST BIOMEDICAL CORPORTION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

CONSOLIDATED BALANCE SHEETS(Stated in U.S. Dollars)

|                                                            | AUGUST 31 |         
|----------------------------------------------------------- | --------- | --------
|                                                            | 2003      |         
|                                                            |           |         
|ASSETS                                                      |           |         
|Current                                                     |           |         
|Cash                                                        | $         | 850     
|Accounts receivable                                         |           | 3,734   
|Prepaid expenses                                            |           | -       
|                                                            |           | 4,584   
|Equipment(Note 3)                                           |           | 1       
|Intangible Assets(Note 4)                                   |           | -       
|                                                            |           |         
|                                                            | $         | 4,585   
|                                                            |           |         
|LIABILITIES                                                 |           |         
|Current                                                     |           |         
|Accounts payable and accrued liabilities                    | $         | 80,382  
|                                                            |           |         
|STOCKHOLDERS EQUITY                                        |           |         
|Capital Stock                                               |           |         
|Authorized:                                                 |           |         
|100,000,000 Common shares, par value
      $0.001 per share |           |         
|                                                            |           |         
|Issued and outstanding:                                     |           |         
|12,065,000 Common
      shares at August 31, 2003 and       |           |         
|12,025,000 Common
      shares at August 31, 2002           |           | 12,065  
|                                                            |           |         
|Additional paid-in capital                                  |           | 517,935 
|                                                            |           |         
|Share Subscriptions Received(Note 6)                        |           | 20,000  
|                                                            |           |         
|Deficit Accumulated During The Development Stage            |           | (625,797
|                                                            |           | (75,797 
|Less: Subscriptions Receivable                              |           | -       
|                                                            |           | (75,797 
|                                                            |           |         
|                                                            | $         | 4,585   

Nature Of Operations(Note 1)

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

CONSOLIDATED STATEMENTS OF LOSS(Stated in U.S. Dollars)

|                                          |   |             |   |   |            | INCEPTION |  
|----------------------------------------- | - | ----------- | - | - | ---------- | --------- | -
|                                          |   |             |   |   |            | MAY 26    |  
|                                          |   | YEARS ENDED |   |   | 2000 TO    |          
|                                          |   | AUGUST 31   |   |   | AUGUST 31  |          
|                                          |   | 2003        |   |   | 2002       |           |  
|                                          |   |             |   |   |            |           |  
|Expenses                                  |   |             |   |   |            |           |  
|Amortization                              | $ | 5,240       |   | $ | 1,331      |           | $
|Consulting fees (Note 8)                  |   | 215,838     |   |   | 32,436     |           |  
|General and administrative                |   | 41,850      |   |   | 11,711     |           |  
|Interest (Note 5)                         |   | 20,000      |   |   | -          |           |  
|Investor relations                        |   | 19,500      |   |   | 3,190      |           |  
|Mineral property option payments          |   | -           |   |   | 10,000     |           |  
|Mineral property exploration expenditures |   | -           |   |   | 4,000      |           |  
|Professional fees                         |   | 101,249     |   |   | 27,500     |           |  
|Stock transfer fees                       |   | 3,478       |   |   | 835        |           |  
|Write down of advances receivable         |   | 1,500       |   |   | -          |           |  
|Write down of equipment                   |   | 33,864      |   |   | -          |           |  
|                                          |   |             |   |   |            |           |  
|Net Loss For The Period                   | $ | 442,519     |   | $ | 91,003     |           | $
|                                          |   |             |   |   |            |           |  
|                                          |   |             |   |   |            |           |  
|Basic And Diluted Loss Per Share          | $ | (0.04       | ) | $ | (0.01      | )         |  
|                                          |   |             |   |   |            |           |  
|                                          |   |             |   |   |            |           |  
|Weighted Average Number of Shares         |   |             |   |   |            |           |  
|Outstanding                               |   | 12,046,534  |   |   | 11,581,250 |           |  
|                                          |   |             |   |   |            |           |  

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS(Stated in U.S. Dollars)

|                                         |   |             |   |   |           | INCEPTION |  
|---------------------------------------- | - | ----------- | - | - | --------- | --------- | -
|                                         |   |             |   |   |           | MAY 26    |  
|                                         |   | YEARS ENDED |   |   | 2000 TO   |          
|                                         |   | AUGUST 31   |   |   | AUGUST 31 |          
|                                         |   | 2003        |   |   | 2002      |           |  
|                                         |   |             |   |   |           |           |  
|Cash Flows From Operating Activities     |   |             |   |   |           |           |  
|Net loss for the period                  | $ | (442,519    | ) | $ | (91,003   | )         | $
|Items not involving cash:                |   |             |   |   |           |           |  
|Amortization                             |   | 5,240       |   |   | 1,331     |           |  
|Interest                                 |   | 20,000      |   |   | -         |           |  
|Write down of equipment                  |   | 33,864      |   |   | -         |           |  
|                                         |   |             |   |   |           |           |  
|Adjustments To Reconcile Net Loss To Net |   |             |   |   |           |           |  
|Cash Used By Operating Activities        |   |             |   |   |           |           |  
|Prepaid expenses                         |   | 1,554       |   |   | (1,554    | )         |  
|Accounts receivable                      |   | (3,734      | ) |   | -         |           |  
|Accounts payable and accrued liabilities |   | 50,791      |   |   | (1,276    | )         |  
|                                         |   | (334,804    | ) |   | (92,502   | )         |  
|                                         |   |             |   |   |           |           |  
|Cash Flows From Financing Activities     |   |             |   |   |           |           |  
|Share capital issued                     |   | 180,160     |   |   | 264,840   |           |  
|Share subscriptions received             |   | 20,000      |   |   | -         |           |  
|Loan payable                             |   | 180,000     |   |   | -         |           |  
|                                         |   | 380,160     |   |   | 264,840   |           |  
|                                         |   |             |   |   |           |           |  
|Cash Flows From Investing Activities     |   |             |   |   |           |           |  
|Purchase of equipment                    |   | (28,114     | ) |   | (12,322   | )         |  
|Patent acquisitions                      |   | (220,000    | ) |   | -         |           |  
|Proceeds from sale of patent             |   | 20,000      |   |   | -         |           |  
|                                         |   | (228,114    | ) |   | (12,322   | )         |  
|                                         |   |             |   |   |           |           |  
|(Decrease) Increase In Cash              |   | (182,758    | ) |   | 160,016   |           |  
|                                         |   |             |   |   |           |           |  
|Cash, Beginning Of Period                |   | 183,608     |   |   | 23,592    |           |  
|                                         |   |             |   |   |           |           |  
|Cash, End Of Period                      | $ | 850         |   | $ | 183,608   |           | $
|                                         |   |             |   |   |           |           |  
|Supplemental Disclosure Of Non-Cash      |   |             |   |   |           |           |  
|Financing Activities                     |   |             |   |   |           |           |  
|Accounts payable for patent cost accrued | $ | -           |   | $ | 20,000    |           | $
|Patent exchanged for loan repayment      | $ | 200,000     |   | $ | -         |           | $
|                                         |   |             |   |   |           |           |  

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

CONSOLIDATED STATEMENT OF STOCKHOLDERS DEFICIENCY

AUGUST 31, 2003(Stated in U.S. Dollars)

|                        | COMMON STOCK |  |        |        |            |   |               | 
|----------------------- | ------------ |  | ------ | ------ | ---------- | - | ------------- | 
|                        |              |  |        |        | ADDITIONAL |   | SHARE         | 
|                        |              |  |        |        | PAID-IN    |   | SUBSCRIPTIONS | 
|                        | SHARES       |  | AMOUNT |        | CAPITAL    |   | RECEIVED      | 
|                        |              |  |        |        |            |   |               | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $0.001 (May 2000)    | 7,500,000    |  | $      | 7,500  |            | $ | -             | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $0.01 (June 2000)    | 4,000,000    |  |        | 4,000  |            |   | 36,000        | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $0.10 (August 2000)  | 75,000       |  |        | 75     |            |   | 7,425         | 
|Net loss for the period | -            |  |        | -      |            |   | -             | 
|                        |              |  |        |        |            |   |               | 
|Balance, August 31,     |              |  |        |        |            |   |               | 
|2000                    | 11,575,000   |  |        | 11,575 |            |   | 43,425        | 
|                        |              |  |        |        |            |   |               | 
|Net loss for the year   | -            |  |        | -      |            |   | -             | 
|                        |              |  |        |        |            |   |               | 
|Balance, August 31,     |              |  |        |        |            |   |               | 
|2001                    | 11,575,000   |  |        | 11,575 |            |   | 43,425        | 
|                        |              |  |        |        |            |   |               | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $0.50 (August 2002)  | 150,000      |  |        | 150    |            |   | 74,850        | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $1.00 (August 2002)  | 300,000      |  |        | 300    |            |   | 299,700       | 
|Net loss for the year   | -            |  |        | -      |            |   | -             | 
|                        |              |  |        |        |            |   |               | 
|Balance, August 31,     |              |  |        |        |            |   |               | 
|2002                    | 12,025,000   |  |        | 12,025 |            |   | 417,975       | 
|                        |              |  |        |        |            |   |               | 
|Share subscriptions     |              |  |        |        |            |   |               | 
|received                | -            |  |        | -      |            |   | -             | 
|Shares issued for cash  |              |  |        |        |            |   |               | 
|at $2.50 (February      |              |  |        |        |            |   |               | 
|2003)                   | 40,000       |  |        | 40     |            |   | 99,960        | 
|Net loss for the year   | -            |  |        | -      |            |   | -             | 
|                        |              |  |        |        |            |   |               | 
|Balance, August 31,     |              |  |        |        |            |   |               | 
|2003                    | 12,065,000   |  | $      | 12,065 |            | $ | 517,935       | 
|                        |              |  |        |        |            |   |               | 

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|1. | NATURE OF OPERATIONS
|-- | --------------------
|   | a)                  
|   | b)                  
|   | c)                  

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|2. | SIGNIFICANT ACCOUNTING POLICIES The
        financial statements of the Company have been prepared in accordance with
        generally accepted accounting principles in the United States. Because
        a precise determination of many assets and liabilities is dependent upon
        future events, the preparation of financial statements for a period necessarily
        involves the use of estimates which have been made using careful judgement.
      The financial statements have, in managements
        opinion, been properly prepared within reasonable limits of materiality
        and within the framework of the significant accounting policies summarized
        below:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|2. | SIGNIFICANT ACCOUNTING POLICIES (Continued)
|-- | -------------------------------------------
|   | d)                                         
|   | e)                                         
|   | f)                                         

| |  | i)   | monetary items at the rate prevailing at the balance sheet date;                                
| |  | ---- | ------------------------------------------------------------------------------------------------
| |  | ii)  | non-monetary items at the historical exchange rate;                                             
| |  | iii) | revenue and expense at the average rate in effect during the applicable
      accounting period.

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|2. | SIGNIFICANT ACCOUNTING POLICIES (Continued)
|-- | -------------------------------------------
|   | g)                                         
|   | h)                                         
|   | i)                                         
|   | j)                                         

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|3. | EQUIPMENT                         |      |         |      |  
|-- | --------------------------------- | ---- | ------- | ---- | -
|   |                                   |      |         |      |  
|   |                                   | 2003 |         | 2002 |  
|   |                                   |      |         |      |  
|   | Office equipment                  | $    | 2,481   |      | $
|   | Laboratory equipment              |      | 37,955  |      |  
|   |                                   |      | 40,436  |      |  
|   | Less: Accumulated amortization    |      | (6,571  | )    |  
|   | Less: Write down to nominal value |      | (33,864 | )    |  
|   |                                   |      |         |      |  
|   |                                   | $    | 1       |      | $

|4. | INTANGIBLE ASSETS
|-- | -----------------
|   | a)               
|   | b)               

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|5. | LOAN PAYABLE
      Loan payable is a short term unsecured bridge financing
        repayable on the earlier of the first major financing or August 30, 2003.
        The loan is repayable in the amount of $200,000 which includes a bonus
        of $20,000 to cover interest.
      On July 9, 2003, the Company entered into a loan and
        security agreement whereby the lender will forgo exercising its right
        to demand immediate payment on August 30, 2003 in consideration of the
        Company doing the following: (i) loan to be secured by the patent covering
        the Oralview Technology; (ii) commence paying the lender interest at 1%
        per month; (iii) repaying the $200,000 amount as follows: $25,000 on or
        before July 15, 2003; $75,000 on or before August 15, 2003; and the balance
        of $100,000 on or before September 15, 2003.
      As the Company has not made any of the required payments,
        the lender has exercised its rights to acquire the patents covering the
        Oralview Technology in exchange for full repayment of the loan.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|6. | SHARE SUBSCRIPTIONS RECEIVED
      The Company has approved the private placement of 3,000,000
        units at $2.00 per unit. Each unit will consist of one common share and
        one warrant to purchase an additional common share at $3.00 for a period
        of eighteen months. As at August 31, 2003, $20,000 had been advanced in
        connection with this private placement. Subsequent to August 31, 2003,
        the Company ceased raising financing under the private placement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|7. | STOCK OPTION PLAN
      The Company adopted a stock option plan (the Plan)
        pursuant to which the directors may grant a maximum of 1,736,250 common
        stock options to officers, key employees and consultants. The Company
        granted 1,735,000 fully vested incentive stock options allowing the holders
        to purchase one common share of the Company at $2.50 per share for a term
        expiring September 9, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|7. | STOCK OPTION PLAN(Continued)
      The following is a summary of the stock option activity during the year
        ended August 31, 2003:
|-- | -----------------------------------------------------------------------------------------------------------------------------------------

| |                              |           |   | WEIGHTED |      
| | ---------------------------- | --------- | - | -------- | -----
| |                              | NUMBER    |   | AVERAGE  |      
| |                              | OF        |   | EXERCISE |      
| |                              | SHARES    |   | PRICE    |      
| |                              |           |   |          |      
| | Outstanding, August 31, 2002 | -         |   | $        | -    
| |                              |           |   |          |      
| | Granted                      | 1,735,000 |   |          | 2.50 
| | Exercised                    | (40,000   | ) |          | (2.50
| |                              |           |   |          |      
| | Outstanding, August 31, 2003 | 1,695,000 |   | $        | 2.50 
| |                              |           |   |          |      

|8. | RELATED PARTY TRANSACTIONS
      During the year ended August 31, 2003, the Company incurred
        consulting expenses of $112,187 (2002 - $18,423) to directors and officers.
      As at August 31, 2003, the Company has $20,850 (2002
        - $23,460) in accounts payable owing to a director and officer.                                                            
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|9. | CONTINGENCY
      The Company is subject to a legal action being brought
        against it by a former director and officer for wrongful dismissal and
        breach of contract. Management is of the opinion that the amount of the
        claim, if any, is not determinable and, accordingly, no provision has
        been recorded in the accounts at August 31, 2003.

---

AUGUST BIOMEDICAL CORPORATION(Formerly Coyote Ventures Corp.)
  (A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2003 AND 2002(Stated in U.S. Dollars)

|10. | SUBSEQUENT EVENTS
      On December 15, 2003, the Company entered into an agreement
        to acquire a 100% working interest (82.5% net revenue interest) in certain
        oil and gas leases located in Yellowstone Counties, Montana, U.S.A. The
        purchase price is $185,366 payable as follows:                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | a)                                                                                                                                                                                                                                                                                                                           
|    | b)                                                                                                                                                                                                                                                                                                                           
|    | Under the terms of the Agreement,
        should the Company elect to proceed with the acquisition following completion
        of the due diligence, it will be committed to expend an additional $3,325,000
        over the next two years to acquire additional leases, complete seismic
        surveys and drill wells.

---

Item 8.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

We have had no disagreements with our accountants on accounting
  or financial disclosures.

ITEM 8A. Controls and Procedures

As required by Rule 13a-15 under the Exchange Act, we carried
  out an evaluation of the effectiveness of the design and operation of our disclosure
  controls and procedures as of August 31, 2003, being the date of our fiscal
  year end covered by this Annual Report. This evaluation was carried out under
  the supervision and with the participation of our Chief Executive Officer, Scott
  Houghton, and our Chief Financial Officer, Korina Houghton. Based upon that
  evaluation, our Chief Executive Officer and Chief Financial Officer concluded
  that our disclosure controls and procedures are effective in timely alerting
  management to material information relating to us required to be included in
  our periodic SEC filings. There have been no significant changes in our internal
  controls or in other factors that could significantly affect internal controls
  subsequent to the date we carried out our evaluation.

Disclosure controls and procedures are controls and other
  procedures that are designed to ensure that information required to be disclosed
  our reports filed or submitted under the Exchange Act is recorded, processed,
  summarized and reported, within the time periods specified in the Securities
  and Exchange Commission's rules and forms. Disclosure controls and procedures
  include, without limitation, controls and procedures designed to ensure that
  information required to be disclosed in our reports filed under the Exchange
  Act is accumulated and communicated to management, including our Chief Executive
  Officer and Chief Financial Officer, to allow timely decisions regarding required
  disclosure.

During our fiscal year ended August 31, 2003, there were no
  changes in our internal control over financial reporting that have materially
  affected, or are reasonably likely to affect, our internal control over financial
  reporting.

The term internal control over financial reporting
  is defined as a process designed by, or under the supervision of, the registrant's
  principal executive and principal financial officers, or persons performing
  similar functions, and effected by the registrant's board of directors, management
  and other personnel, 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 principles and includes
  those policies and procedures that:

| | (1) | Pertain to the maintenance of records
        that in reasonable detail accurately and fairly reflect the transactions
        and dispositions of the assets of the registrant;       
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Provide reasonable assurance that transactions
        are recorded as necessary to permit preparation of financial statements
        in accordance with generally accepted accounting

22

---

| |     | principles, and that receipts and expenditures of
        the registrant are being made only in accordance with authorizations of
        management and directors of the registrant; and                                              
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (3) | Provide reasonable assurance regarding prevention
        or timely detection of unauthorized acquisition, use or disposition of
        the registrant's assets that could have a material effect on the financial
        statements.

PART III

Item 9. Directors and Executive Officers of the Registrant

The following table sets forth the names, ages, and positions
  with the Company for each of the directors and officers of the Company.

|Name              | Age | Position                | Since
|----------------- | --- | ----------------------- | -----
|                  |     |                         |      
|Scott C. Houghton | 35  | President and           | 2000 
|                  |     | Director                |      
|                  |     |                         |      
|Korina Houghton   | 35  | Secretary/treasurer and | 2002 
|                  |     | Director                |      
|                  |     |                         |      
|Arnold Howardson  | 58  | Senior Vice-President   | 2002 

Scott C. Houghton. Scott C. Houghton was appointed
  as a director and as president on May 26, 2000. Mr. Houghton holds a Mechanical
  Engineering degree from the University of New Brunswick. From December 1997
  to May 2000, Mr. Houghton was the president and a director of Universal Domains
  Incorporated (formerly Four Crown Foods Inc.) a wholesale distributor of seafood
  products and public company that trades on the OTC Bulletin Board. From March
  1995 to September 1997, Mr. Houghton worked as the vice president of corporate
  relations for A.A.N. Holdings, Ltd, a corporate management company. Besides
  his work with the Company since May of 2000, Mr. Houghton has been working as
  an unpaid campaign coordinator for the Liberal Party in Canada and managing
  his personal investment portfolio.

Korina Houghton.Korina Houghton received her Bachelor
  of Science Degree from the University of New Brunswick in 1993 and has held
  a number of communications and environmental planning positions throughout British
  Columbia. In addition, she is active in a number of charitable foundations and
  established The Foundation of Hope for Childrens Hospitals, a BC based
  charity, in 1998.

23

---

Arnold Howardson.Arnold Howardson is Senior Vice-President
  of the Company and has served in this capacity since October 16, 2002. For the
  past 25 years Mr. Howardson has been the president of Olympic Power and Engineering
  Corp.

Term of Office

Our directors are appointed for a one-year term to hold office
  until the next annual general meeting of our shareholders or until removed from
  office in accordance with our bylaws. Our officers are appointed by our board
  of directors and hold office until removed by the board.

Significant Employees

We have no significant employees other than our officers and
  directors. We conduct our business through agreements with consultants and arms-length
  third parties.

Committees of the Board Of Directors

We presently do not have an audit committee, compensation
  committee, nominating committee, an executive committee of our board of directors,
  stock plan committee or any other committees. However, our board of directors
  is considering establish various committees during the current fiscal year.

Audit Committee Financial Expert

We have no financial expert. We believe the cost related to
  retaining a financial expert at this time is prohibitive. Further, because of
  our start-up operations, we believe the services of a financial expert are not
  warranted.

Code of Ethics

We have not yet adopted a corporate code of ethics. Our board
  of directors is considering, over the next year, establishing a code of ethics
  to deter wrongdoing and promote honest and ethical conduct; provide full, fair,
  accurate, timely and understandable disclosure in public reports; comply with
  applicable laws; ensure prompt internal reporting of code violations; and provide
  accountability for adherence to the code.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE
  ACT

Section 16(a) of the Exchange Act requires our executive officers
  and directors, and persons who own more than 10% of a registered class of our
  equity securities (Reporting Persons), to file reports of ownership
  and changes in ownership with the SEC. Reporting Persons are required by SEC
  regulations to furnish us with copies of all forms they file pursuant to Section
  16(a). Based solely on our review of the copies of such reports received by
  it, and written representations from certain Reporting Persons that no other
  reports were required for those persons, we believe that,

24

---

during the year ended August 31, 2003, the Reporting Persons
  complied with all Section 16(a) filing requirements applicable to them.

Item 10. Executive Compensation

Summary Compensation Table

The table below summarizes all compensation awarded to, earned
  by, or paid to the following individuals, our named executive officers
  for the two most recently completed fiscal years ended August 31, 2002 and August
  31, 2003.

|                  |                                                            | AnnualCompensation | Long TermCompensation
|----------------- | ---------------------------------------------------------- | ------------------ | ---------------------
|Name              | Title                                                      | Year               | Salary               
|Scott C. Houghton | President, Chief Executive Officer and Director            | 2002               | $0                   
|                  |                                                            | 2003               | $0                   
|Korina Houghton   | Secretary, Treasurer, Chief Financial Officer and Director | 2002               | $0                   
|Peter Whitehead   | Former Vice-President andDirector                          | 2002               | $0                   
|                  |                                                            | 2003               | $62,187              
|Arnold Howardson  | Vice- President                                            | 2002               | $0                   
|                  |                                                            | 2003               | $0                   
|John Manker       | Former Vice- President and Director                        | 2002               | $0                   
|                  |                                                            | 2003               | $0                   

(1) All of the options are exercisable at a price of $2.50
  per share until September 9, 2004. The options granted to the above named executive
  officers represent 34.9% of the total options granted.

25

---

STOCK OPTION GRANTS

We did not grant any stock options to the executive officers
  or directors from during the year ended August 31, 2002. We granted stock options
  to directors, employees and consultants on September 9, 2002 entitling them
  to purchase up to 1,735,000 common shares of the Company at a price of $2.50
  per share at any time up to September 9, 2004 under the terms of an option plan
  designated the 2002 Stock Option Plan.

EXERCISES OF STOCK OPTIONS AND YEAR-END OPTION VALUES

No stock options were exercised by our officers, directors
  or employees during the financial year ended August 31, 2003. A total of 40,000
  options were exercised at $2.50 per share by consultants during the fiscal year
  ended August 31, 2003.

OUTSTANDING STOCK OPTIONS

There are presently 671,500 options outstanding under our
  2002 Stock Option Plan including the 430,000 options held by our named executive
  officers as set out above. At the present time the options are of little or
  no value as the exercise price exceeds the market price of the Companys
  common shares.

Item 11. Security Ownership of Certain Beneficial Owners
  and Management

The following table sets forth as of January 14, 2003, the
  number and percentage of the outstanding shares of common stock which, according
  to the information supplied to the Company, were beneficially owned by (i) each
  person who is currently a director of the Company, (ii) each executive officer,
  (iii) all current directors and executive officers of the Company as a group
  and (iv) each person who, to the knowledge of the Company is the beneficial
  owner of more than 5% of the outstanding common stock. Except as otherwise indicated,
  the persons named in the table have sole voting and dispositive power with respect
  to all shares beneficially owned, subject to community property laws where applicable.

|Title of class | Name and address                 | Amount of            | Percent 
|-------------- | -------------------------------- | -------------------- | --------
|class(1)       | of beneficial owner              | beneficial ownership | of      
|               |                                  |                      |         
|               |                                  |                      |         
|Common Stock   | Scott C. Houghton                | 2,780,000 shares(2)  | 22.6%(3)
|               | 1201 West Pender Street          |                      |         
|               | Suite 202                        |                      |         
|               | Vancouver, BC V6E 2V2            |                      |         
|               |                                  |                      |         
|Common Stock   | Korina Houghton                  | 2,780,000 shares(4)  | 22.6%(3)
|               | 1238 Melville Street, Suite 1205 |                      |         
|               | Vancouver, BC V6E 4N2            |                      |         

26

---

|Common Stock | Arnold Howardson            | 2,100,000 shares(5) | 17.1%(3)
|------------ | --------------------------- | ------------------- | --------
|             | 6131 Greenwood Place        |                     |         
|             | Nanaimo, BC V9V 1K6         |                     |         
|             |                             |                     |         
|Common Stock | Peter Whitehead             | 1,500,000 shares    | 13.7%(3)
|             | 2440 Queens Avenue          |                     |         
|             | West Vancouver, BC V7V 2Y6  |                     |         
|             |                             |                     |         
|Common Stock | Nick MacKinnon              | 1,500,000 shares    | 13.9%(3)
|             | 2267 Marstrand Avenue       |                     |         
|             | Vancouver, BC V6K 2H8       |                     |         
|             |                             |                     |         
|Common Stock | All Officers and Directors  | 4,880,000 shares(6) | 39.1(7) 
|             | as a Group that consists of |                     |         
|             | three people                |                     |         

|(1) | The percent of class is based on 12,065,000
        shares of common stock issued and outstanding as of January 14, 2004.                                                                                                                                                                                                                                                                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Of the shares represented, 2,500,000
        are in the name of Scott C. Houghton and 60,000 shares are in the name
        of his wife, Korina Houghton, of which he is deemed to be the beneficial
        owner. Also in the number of shares represented, 220,000 represent options
        to purchase common shares. Of these options, 195,000 are held in the name
        of Scott C. Houghton and 25,000 are held in the name of Korina Houghton.    
|(3) | Percentage is calculated assuming the
        options beneficially held by this securities holder (but only this holder)
        have been exercised.                                                                                                                                                                                                                                                                                                         
|(4) | Of the shares represented, 60,000 are
        in the name of Korina Houghton and 2,500,000 shares are in the name of
        her husband, Scott C. Houghton, of which she is deemed to be the beneficial
        owner. Also in the number of shares represented, 220,000 represent options
        to purchase common shares. Of these options, 25,000 are held in the name
        of Korina Houghton and 195,000 are held in the name of Scott C. Houghton.
|(5) | Of the shares represented, 1,900,000
        are held by Mr. Howardson outright and 200,000 represent options to purchase
        common shares.                                                                                                                                                                                                                                                                                                              
|(6) | Of the shares represented, 4,460,000
        are held outright and 420,000 represent options to purchase common shares.
        The shares and options held by Scott C. Houghton and Korina Houghton have
        only been included once, even though they are the beneficial holder of
        the securities of the other.                                                                                                                                 
|(7) | Percentage is calculated assuming the
        options held by the officers and directors have been exercised.                                                                                                                                                                                                                                                                                                                                                 

27

---

Item 12. Certain Relationships and Related Transactions

There have been no transactions by the Company within the
  last two years where a director, officer or shareholder of the Company, had
  a direct or indirect interest.

PART IV

Item 13. Exhibits and Reports on Form 8-K

(a) Reports on Form 8-K

On July 10, 2003, the Company filed a Report on Form 8-K announcing
  under Item 2 of that report the disposition of its CERVeyorTM Technology
  and under Item 5 of that report the granting of a security interest in its ORALview
  Technology, as more particularly described elsewhere in this Form 10-KSB.

On December 23, 2003, the Company filed a Report on Form 8-K
  announcing under Item 2 of that report that the Company had acquired its interest
  in the Horizontal Amsden Play described elsewhere in this Form 10-KSB.

(b) Exhibits

EXHIBITS REQUIRED BY ITEM 601 OF REGULATION S-B

|Exhibit |  |                                                                      
|------- |  | ---------------------------------------------------------------------
|Number  |  | Description of Exhibit                                               
|        |  |                                                                      
|        |  |                                                                      
|3.1     |  | Articles of Incorporation (1)                                        
|        |  |                                                                      
|3.2     |  | Bylaws (1)                                                           
|        |  |                                                                      
|4.1     |  | Share Certificate (1)                                                
|        |  |                                                                      
|10.1    |  | Sale of Technology Agreement (2)                                     
|        |  |                                                                      
|10.2    |  | Option Agreement dated September 9, 2002 (4)                         
|        |  |                                                                      
|10.3    |  | BCCA Royalty Agreement (4)                                           
|        |  |                                                                      
|10.4    |  | Loan and Security Agreement with 648613 BC Ltd. dated July 9, 2003(5)

28

---

|10.5 |  | Purchase and Sale Agreement with Zone Exploration,
        Inc. dated December 15, 2003 for the purchase of the Horizontal Amsden
        Play (6)                   
|---- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |  |                                                                                                                                                                      
|19.1 |  | Definitive Information Statement on Schedule 14C
        (3)                                                                                                         
|     |  |                                                                                                                                                                      
|31.1 |  | Certification of Chief
        Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
        2002 (7)                                               
|     |  |                                                                                                                                                                      
|31.2 |  | Certification of Chief
        Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
        2002 (7)                                               
|     |  |                                                                                                                                                                      
|32.1 |  | Certification of Chief
        Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
        to Section 906 of the Sarbanes-Oxley Act of 2002 (7)
|     |  |                                                                                                                                                                      
|32.2 |  | Certification of Chief
        Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
        to Section 906 of the Sarbanes-Oxley Act of 2002 (7)
|     |  |                                                                                                                                                                      

|    |                                                                                                           
|--- | ----------------------------------------------------------------------------------------------------------
|(1) | Previously Filed as an Exhibit to our Form SB-2/A registration
      statement filed on November 28, 2001.
|(2) | Previously Filed as an Exhibit to our Current Report on Form
      8-K filed on August 30, 2002.          
|(3) | Previously Filed with the Securities and Exchange Commission
      on December 6, 2002.                   
|(4) | Previously Filed as an Exhibit to our Annual Report on Form
      10-KSB filed on December 16, 2002       
|(5) | Previously Filed as an Exhibit to our Current Report on Form
      8-K filed on July 10, 2003             
|(6) | Previously Filed as an Exhibit to our Current Report on Form
      8-K filed on December 23, 2003         
|(7) | Filed as an Exhibit to this Annual Report on Form 10-KSB                                                  
|    |                                                                                                           

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ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES.

AUDIT FEES

The aggregate fees billed for the fiscal year ended August
  31, 2003 for professional services rendered by the principal accountant for
  the audit of our annual financial statements and review of the financial statements
  included in our Form 10-KSB or services that are normally provided by the accountant
  in connection with statutory and regulatory filings or engagements for these
  fiscal periods were estimated at $10,200.

AUDIT RELATED FEES

None.

TAX FEES

None.

ALL OTHER FEES

None.

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act,
  the registrant caused this report to be signed on its behalf by the undersigned,
  thereunto duly authorized.

AUGUST BIOMEDICAL CORPORATION

|By: | /s/Scott C. Houghton                                          
|--- | --------------------------------------------------------------
|    | Scott C. Houghton, President and Chief Executive
      Officer
|    | Director                                                      
|    | Date:                                                         

In accordance with the Securities Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

|By: | /s/Scott C. Houghton                                                   
|--- | -----------------------------------------------------------------------
|    | Scott C. Houghton, President and Chief Executive
      Officer         
|    | Principal Executive Officer)                                           
|    | Director                                                               
|    | Date:                                                                  
|    |                                                                        
|By: | /s/Korina Houghton                                                     
|    | Korina Houghton, Secretary, Treasurer and Chief
      Financial Officer
|    | (Principal Financial Officer and Principal Accounting
      Officer)   
|    | Director                                                               
|    | Date:                                                                  

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