It has been more than a year since we reported on
AuGRID Corporation (Pink Sheets: AGRI). Little seems to have changed –
at least in several critical respects. The Company has stopped filing
quarterly financial reports with the SEC and still is searching for a
viable business. There is a disquieting sense that this Company is
running in place – if it is running anywhere at all.
AuGRID continues to announce new business ventures, but there is no sign that any of them have proven profitable – or even marginally successful. When we first wrote about the Company in October 2003, it was trumpeting a plan to enter the market for flat-panel display screens – relying on a licensing agreement with an English firm called CeraVision Limited. There was just one problem. According to a representative of CeraVision, AuGRID had not paid the required licensing fees and the agreement had been terminated. See Augrid Corporation - Another Rubin-Esque Venture?; Augrid Corporation - S-8s Are Us; Augrid Corporation - Is New Major Shareholder A Major Headache?; Augrid Corporation - Does Activity Equal Action? Although AuGRID continued to lay claim to that license, it ultimately acknowledged the possibility of a dispute, retaining counsel to explore the status of the CeraVison license.
But AuGRID was not deterred by the fog surrounding its relationship with CeraVision. In August 2003, the Company acquired Alysium Corporation – another ill-fated venture. AuGrid originally claimed that Alysium was “a diversified industrial manufacturer with an exclusive technology in both ThermoCouple manufacturing and Nano Technology.” Later, the Company said that Alysium was developing “body armor.” Still later, AuGRID said that Alysium was “distributing specialty sensors, drives and motors.”
Exactly what was Alysium doing? Not enough, as it turned out. On March 30, 2005, AuGRID announced that it as a “cost cutting measure” it had “temporarily” ceased research, development and distribution operations at Alysium. Is this temporary interregnum likely to prove permanent? AuGRID seems to be making a clean break with the underperforming subsidiary. The Company said it was firing the Alysium staff in Houston and Austin, Texas, relocating its corporate headquarters to Cleveland, Ohio, exploring ways to unwind the Alysium merger, and considering lawsuits against “three consultants and four of the Alysium partners.” None of these measures sound temporary.
Meanwhile, Alysium was not the only flickering flame in the AuGRID fire. In September 2003, the Company undertook yet another venture, announcing that it would sell electronic products, including television monitors, through a newly formed subsidiary called Optipure LLC. Although the Company subsequently claimed to have signed up “approximately” 15 dealers and distributors for the Optipure products in the U.S. and abroad, it is not clear whether the subsidiary has generated any revenues.
Any income that flowed from Alysium or Optipure seems to have been short-lived. Indeed, the nature of AuGRID’s revenues – such as they are – is something of a mystery since the Company has stopped filing financial reports with the SEC. AuGRID’s most recent Form 10-Q, for the quarter ended September 30, 2004, indicated that the Company had no revenues at all between June 1 and September 30, 2004. During the first six months of 2004, AuGRID generated revenues of approximately $254,000 from one or both of its ventures – far less than the nearly $900,000 in general and administrative expenses incurred during that period.
Now the Company says that Optipure is about to gain traction in the Middle East. Although AuGRID has shuttered its offices in Texas as a “cost-cutting” measure, it recently announced the opening of a new office in Dubai – claiming that a search is under way to select distributors and installers for Optipure’s video and “soon to be released” audio products.
Those potential distributors and installers are likely to be a tad confused if they look for Optipure’s audio and video products on the website identified in AuGRID’s May 26, 2005 press release - http://www.optipure.com. That website belongs to the Optipure Brand of Chemco Industries, “a leading supplier of quality raw materials for the nutritional supplement industry.” There is no mention of electronic equipment, video and audio products, or AuGRID.
The dispute with CeraVision, demise of Alysium, and doubts surrounding Optipure are not the only questions facing AuGRID. On December 13, 2004, the Company issued a press release stating that its trading symbol had been changed from AGRI to AGRIE and going on to say that, as the result of a random audit, the Company was being asked to comply with the provision of the Sarbanes Oxley Act that requires public companies to use accountants who have registered with the Public Company Accounting Oversight Group.
The Company said that its auditor, Henry Creel was working to “amend this issue” and the Company’s “internal comptroller,” Stan Chapman, said that AuGRID would “move swiftly to comply with the decision of the auditor.”
What did Creel discover and Chapman implement? On January 26, 2005, Henry L. Creel Co. Inc. was replaced as AuGRID’s independent auditor. On May 25, 2005, Stan Chapman was removed as an Officer and Director of the Company. AuGRID said that it would seek to hire an individual with suitable knowledge of public company financial requirements. The Company said that both men were terminated at the recommendation of the Audit Committee, which, according to a Form 14A Information Statement filed on September 30, 2004, consists of “non-management member of the Board. That same Information Statement indicated that the Board was comprised of Chapman, M.J. Shaheed (the Company’s CEO and President), Mary Sloat-Horoszko (Secretary and manager of the Company’s day-to-day operations) and Essa Mashni – and that only Mashni was not also a corporate officer.
That would suggest that Mashni was the sole member of the Audit Committee. His biography does not indicate any meaningful financial background. Mashni is a pharmacist and a member of the American Pharmaceutical Association, the Michigan Pharmacy Association, the American Ramallah Federation and St. Mary's Antiochian Orthodox Church.
The December 13th press release implied that the symbol change for the Company’s stock was somehow related to the NASD’s “random audit.” That is not necessarily the case. NASD routinely adds the additional “E” to a stock symbol when a Company is not in compliance with its reporting obligations. Companies may be removed from the OTC Bulletin Board if they have not demonstrated their compliance within 30 business days. On February 3, 2005, AuGRID was removed from the OTC Bulletin Board for failure to comply with NASD’s reporting requirements. The Company now trades on the Pink Sheets.
And now it is making plans for a new venture and dropping a major name along the way. On June 9, 2005, the Company disclosed that it had completed production of a prototype “Home Entertainment PC Gaming System” to be combined with its “Internet Audio System.” AuGRID stated that it has “reached out to Microsoft” for a possible collaboration on its Internet audio device.
AuGRID did not explain how it hoped to carve a place in the highly competitive home entertainment market – where other players are well-entrenched and far better capitalized. Nor did the Company indicate how it is financing this latest venture, when the prototypes were created and by whom and whether it has any patents or trademarks for the product.
Is there any possibility that Microsoft will respond favorably to the Company’s overtures? It seems like quite a reach. Alas, it would appear that, once again, AuGRID’s reach may exceed its grasp.
IF YOU HAVE QUESTIONS OR COMMENTS FOR STOCKPATROL.COM, CONTACT US AT editor@stockpatrol.com
AuGRID continues to announce new business ventures, but there is no sign that any of them have proven profitable – or even marginally successful. When we first wrote about the Company in October 2003, it was trumpeting a plan to enter the market for flat-panel display screens – relying on a licensing agreement with an English firm called CeraVision Limited. There was just one problem. According to a representative of CeraVision, AuGRID had not paid the required licensing fees and the agreement had been terminated. See Augrid Corporation - Another Rubin-Esque Venture?; Augrid Corporation - S-8s Are Us; Augrid Corporation - Is New Major Shareholder A Major Headache?; Augrid Corporation - Does Activity Equal Action? Although AuGRID continued to lay claim to that license, it ultimately acknowledged the possibility of a dispute, retaining counsel to explore the status of the CeraVison license.
But AuGRID was not deterred by the fog surrounding its relationship with CeraVision. In August 2003, the Company acquired Alysium Corporation – another ill-fated venture. AuGrid originally claimed that Alysium was “a diversified industrial manufacturer with an exclusive technology in both ThermoCouple manufacturing and Nano Technology.” Later, the Company said that Alysium was developing “body armor.” Still later, AuGRID said that Alysium was “distributing specialty sensors, drives and motors.”
Exactly what was Alysium doing? Not enough, as it turned out. On March 30, 2005, AuGRID announced that it as a “cost cutting measure” it had “temporarily” ceased research, development and distribution operations at Alysium. Is this temporary interregnum likely to prove permanent? AuGRID seems to be making a clean break with the underperforming subsidiary. The Company said it was firing the Alysium staff in Houston and Austin, Texas, relocating its corporate headquarters to Cleveland, Ohio, exploring ways to unwind the Alysium merger, and considering lawsuits against “three consultants and four of the Alysium partners.” None of these measures sound temporary.
Meanwhile, Alysium was not the only flickering flame in the AuGRID fire. In September 2003, the Company undertook yet another venture, announcing that it would sell electronic products, including television monitors, through a newly formed subsidiary called Optipure LLC. Although the Company subsequently claimed to have signed up “approximately” 15 dealers and distributors for the Optipure products in the U.S. and abroad, it is not clear whether the subsidiary has generated any revenues.
Any income that flowed from Alysium or Optipure seems to have been short-lived. Indeed, the nature of AuGRID’s revenues – such as they are – is something of a mystery since the Company has stopped filing financial reports with the SEC. AuGRID’s most recent Form 10-Q, for the quarter ended September 30, 2004, indicated that the Company had no revenues at all between June 1 and September 30, 2004. During the first six months of 2004, AuGRID generated revenues of approximately $254,000 from one or both of its ventures – far less than the nearly $900,000 in general and administrative expenses incurred during that period.
Now the Company says that Optipure is about to gain traction in the Middle East. Although AuGRID has shuttered its offices in Texas as a “cost-cutting” measure, it recently announced the opening of a new office in Dubai – claiming that a search is under way to select distributors and installers for Optipure’s video and “soon to be released” audio products.
Those potential distributors and installers are likely to be a tad confused if they look for Optipure’s audio and video products on the website identified in AuGRID’s May 26, 2005 press release - http://www.optipure.com. That website belongs to the Optipure Brand of Chemco Industries, “a leading supplier of quality raw materials for the nutritional supplement industry.” There is no mention of electronic equipment, video and audio products, or AuGRID.
The dispute with CeraVision, demise of Alysium, and doubts surrounding Optipure are not the only questions facing AuGRID. On December 13, 2004, the Company issued a press release stating that its trading symbol had been changed from AGRI to AGRIE and going on to say that, as the result of a random audit, the Company was being asked to comply with the provision of the Sarbanes Oxley Act that requires public companies to use accountants who have registered with the Public Company Accounting Oversight Group.
The Company said that its auditor, Henry Creel was working to “amend this issue” and the Company’s “internal comptroller,” Stan Chapman, said that AuGRID would “move swiftly to comply with the decision of the auditor.”
What did Creel discover and Chapman implement? On January 26, 2005, Henry L. Creel Co. Inc. was replaced as AuGRID’s independent auditor. On May 25, 2005, Stan Chapman was removed as an Officer and Director of the Company. AuGRID said that it would seek to hire an individual with suitable knowledge of public company financial requirements. The Company said that both men were terminated at the recommendation of the Audit Committee, which, according to a Form 14A Information Statement filed on September 30, 2004, consists of “non-management member of the Board. That same Information Statement indicated that the Board was comprised of Chapman, M.J. Shaheed (the Company’s CEO and President), Mary Sloat-Horoszko (Secretary and manager of the Company’s day-to-day operations) and Essa Mashni – and that only Mashni was not also a corporate officer.
That would suggest that Mashni was the sole member of the Audit Committee. His biography does not indicate any meaningful financial background. Mashni is a pharmacist and a member of the American Pharmaceutical Association, the Michigan Pharmacy Association, the American Ramallah Federation and St. Mary's Antiochian Orthodox Church.
The December 13th press release implied that the symbol change for the Company’s stock was somehow related to the NASD’s “random audit.” That is not necessarily the case. NASD routinely adds the additional “E” to a stock symbol when a Company is not in compliance with its reporting obligations. Companies may be removed from the OTC Bulletin Board if they have not demonstrated their compliance within 30 business days. On February 3, 2005, AuGRID was removed from the OTC Bulletin Board for failure to comply with NASD’s reporting requirements. The Company now trades on the Pink Sheets.
And now it is making plans for a new venture and dropping a major name along the way. On June 9, 2005, the Company disclosed that it had completed production of a prototype “Home Entertainment PC Gaming System” to be combined with its “Internet Audio System.” AuGRID stated that it has “reached out to Microsoft” for a possible collaboration on its Internet audio device.
AuGRID did not explain how it hoped to carve a place in the highly competitive home entertainment market – where other players are well-entrenched and far better capitalized. Nor did the Company indicate how it is financing this latest venture, when the prototypes were created and by whom and whether it has any patents or trademarks for the product.
Is there any possibility that Microsoft will respond favorably to the Company’s overtures? It seems like quite a reach. Alas, it would appear that, once again, AuGRID’s reach may exceed its grasp.
IF YOU HAVE QUESTIONS OR COMMENTS FOR STOCKPATROL.COM, CONTACT US AT editor@stockpatrol.com
