Tugboat International, Inc. Signs Merger Agreement with MidNet Inc. RENO, NV, Dec. 12 /PRNewswire-FirstCall/ -- Tugboat International, Inc. (OTCBB: TUGB - News) is pleased to announce the signing of a merger agreement with MidNet Inc., a Nevada company with a sales and marketing office in Canada. Under the terms of the agreement, 100% of the issued and outstanding shares of stock of MidNet will be exchanged for shares of Tugboat International Inc., resulting in MidNet becoming a wholly-owned subsidiary of Tugboat. Post-merger, Tugboat has 13,050,000 shares of Common Stock issued and outstanding, of which MidNet shareholders own 7,506,000 shares. In addition, the three new Tugboat Directors identified below, own 300,000 shares of Tugboat Preferred Stock, two consultants and three unrelated members of the Board of Advisors of Tugboat own options to purchase 1,260,000 shares of Tugboat restricted Common Stock, at an exercise price of US$.50 per share. Tugboat intends to file a Form 8-KSB with the SEC next week to set forth in detail the terms of the merger, together with a copy of the merger agreement. About MidNet Over the past three years, the founders of MidNet have created and developed a proprietary enabling technology known as "The Middle Network", which allows its end user customers to communicate digitally in a secure, reliable and cost effective environment. The Middle Network acts as the 'middle layer' between telecommunications infrastructure companies (Telco's) and Application Service Providers (ASP's) for the benefit of end user customers. The Middle Network is neutral in all respects, and, by virtue of its immense capacity, provides a complementary and effective digital alternative to the unsecured and congested Internet (fraught with viruses, worms and hackers), parcel couriers and expensive limited private networks. The Company anticipates that users will accept The Middle Network as a critical enhancement to their workflow environments furthering the sustainability and future growth of their businesses. With this merger agreement executed, MidNet's management team is well positioned to execute its business plan and strategies and manage growth well into the future. Directors With expertise in secure data centers, digital telephone and data networking, electronic commerce, audio/video post-production, videoconferencing, government services, and the community of people with disabilities, the Company's management has planned specifically for this opportunity. Since 1995, management has taken time to study needs, evaluate opportunities, test hypotheses, develop relationships and gain acceptance within target markets. Peter Fentiman - President, CEO, Director Mr. Fentiman, a graduate of the Eastern Ontario Institute of Technology in Business Administration, has spent the best part of his working career in executive positions with public companies in Canada and the United States. Currently Mr. Fentiman is the President of Fenco Consulting Inc., a management consulting firm specializing in the development of companies going public. Previously he held the position as President of Canadian operations for Satellite Conferencing International Inc., a public company in the business of two-way interactive videoconferencing. Mr. Fentiman was responsible for and successfully negotiated cross border links between AT&T, BC Tel and Telsat Canada, to establish videoconferencing between its facilities in Canada and the United States. Tilo Kunz - Founder, Chairman, COO, Director Mr. Kunz received a Diploma of Technical Sales, Marketing Management, and Small Business from the British Columbia Institute of Technology in 1989. Since then he has held numerous positions in the communications and data networking industries, including sales and marketing, network design and systems integration, purchasing, managerial accounting, and senior management. For the past ten years Mr. Kunz has specialized in network based media applications. Based in Vancouver, Canada, Mr. Kunz's earliest projects took place in the Soviet Union. During this time, he became aware of the important role that communications systems play in changing societies by helping people to access and exchange information and ideas. Mr. Kunz also experienced the efficiency and productivity gains that organizations can realize from well-designed and integrated data communications systems. Mr. Kunz is involved in product/service design, business case development, strategic relationships, and service implementation for the Company. Ruedi Aschwanden - Founder, CTO, VP Technology, Director Mr. Aschwanden is the Company's "technologist" and has designed the network architecture as well as the software-based solutions for configuration and support of the network. Over the last 24 years, he was involved with a number of start-ups and is on the board of directors of several companies. He has backgrounds in electronics engineering and computer science, holds a Masters degree in Business Administration, and uses his engineering, people and business skills to help companies succeed in high-tech ventures. In one of his prior engagements, he was Director of Technology of Multiactive Technologies Inc., in Vancouver, B.C., where he helped put together the team that created the "ecBuilder" software that won the 1999 BC Technology Industries Association award for 'Excellence in Product Innovation', over Seagate Software, and the prestigious 1999 Software & Information Industry Association (SIIA) "Codie" award for 'Best Internet Commerce Software', over finalists such as Microsoft, Adobe and NetPerceptions. For further information please contact MidNet at 1-604.609.6188 Forward looking Statements The statements made in this press release are forward-looking and are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. The uncertainties and risk include, but are not limited to, the ability of MidNet or the company to execute effectively its business plan, changes in the market for MidNet's proposed network services, changes in stock and business market activity, realization of anticipated customers, seasonality, the development of new products and services, the enhancement of existing products and services, competitive pressures (including price competition), systems failures, economic and political conditions, changes in customer behavior and the introduction of competing products having technological and /or other advantages. Any forward-looking statements are made pursuant to the "safe harbor" provided by the Private Securities Litigation Reform Act of 1995, and as such, speaks only as of the date made. Statements made in this document that are not purely historical are forward-looking statements, including any statements as to beliefs, plans, expectations, or intentions regarding the future. The company assumes no obligation to update information concerning its expectations. DATASOURCE: Tugboat International, Inc. CONTACT: MidNet at 1-604-609-6188

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