P K G, UTK is the company that brokered the deal between Mast and the University of Wyoming for the license to the ARTI filter technology. ( Note that MARTI does not own the patent to the technology, that belongs to the U of W and Dr. Reddi, the inventor. UTK brokered the patent license agreement and received a large block of shares in the deal). UTK held those shares even through the fraudulent SEC period. But I found through filings that UTK sold all their shares when word hit us that HYRF was in talks with BCGU. It is obvious what UTK felt involvement with a hedge fund would do to their remaining share value. To get an idea of the condition things were in at or about the time UTK bailed read this letter from Neil Hill, then HYRF CEO to Dennis Mast. Dr. Hill filed this letter with the SEC:
July 5, 2006
EXHIBIT
Mr. Dennis Mast
HydroFlo, Inc.
2501 Reliance Avenue
Apex, North Carolina 27539
Reference: Employment Termination Letter
Dear Dennis:
This letter serves as an official notification of my decision to step down as CEO of HydroFlo, Inc. Following are my primary reasons: 1) Your decision to breech my Employment Agreement at the substitute annual shareholder’s meeting June 29, 2006. At that meeting you used your majority stake in HydroFlo stock to control the election results and vote against the Board of Director’s proposals for restructuring the organization, directly usurping my directives as CEO, and in conflict with SEC sanctions against you. 2) Your continual attempts at getting “upbeat” information to the public, strictly to maintain share price, when, if fact, there was no good news. This includes the attempt to do a reverse merger into Shine Holdings, which would artificially increase the stock price, so that you could raise additional capital, in direct conflict with SEC sanctions. Additionally, I have discovered that four CFO’s submitted their resignations to HydroFlo within the previous year, which was never submitted to the SEC under Form 8K, as required by law. If I had been able to uncover this information before April, I likely would not have taken the HydroFlo CEO position; thereby, eliminating the irreparable personal harm suffered by my family. 3) Your unwillingness to provide adequate funding for HydroFlo’s operations, a critical element in convincing me to accept the CEO position.
Dennis, as you know, HydroFlo’s current ratio is upside down, and you did not fund payroll in June. This situation simply is untenable. This company is bankrupt, but without a reorganization plan. My opinion is that Chapter 11 is the only scenario whereby corporate survival is possible, so that the company might maintain its only assets: its technologies and licenses. As you know, raising capital is next to impossible as long as we have the real and contingent liabilities associated with the shareholder suits related to the false statements made by you and George in 2005 and this year, and the SEC sanctions against you and the company.
Dennis, you induced me into coming to HydroFlo by multiple misrepresentations and misleading and false statements, and I am unwilling to serve HydroFlo stakeholders any longer, if you expect me to be your “yes” man; or if I am expected to be accountable to one shareholder who continually exhibits a reckless disregard for the laws and regulations governing public companies.
Mast, IMO, then set his buddy Moore in Neil's still warm chair and given the desperate straights the company was in did not follow Hill's recommendation of reorganizing the company under bankruptcy courts. In stead they turned to a hedge fund (BCGU) to print paper for cash. UTK saw the writing on the wall and bailed.
jc
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Many companies that have found their way to market via UTK have found their way into pump and dump fraud cases brought by the SEC. A little research will produce things like this:
UTEK Corp.
by Christopher Carey
UTEK Corp.’s latest quarterly report lists the value of its stake in Fuel FX International Inc. at $7.05 million. Some may question that number, given that there is no public market for Fuel FX’s shares, that its Web site lists no sales outlets or pricing information, and that its corporate headquarters is its chief executive’s house.
UTEK's headquarters in Tampa.The Florida-based technology transfer company (AMEX: UTK) valued its stock in Advanced Refractive Technologies Inc. at $4.8 million. That company has no revenue, reported just $286 in cash at the end of its most recent quarter and was in default on its debt, which is secured by the company’s assets.
A Sharesleuth.com investigation suggests that the stated values of the stock that UTEK received through its technology deals with numerous small companies should be examined closely. If so, the company’s financial results also should be scrutinized, because the shares are its chief source of revenue, and the value assigned to them is a major determinant of its earnings.
UTEK’s own share price has risen as the pace of its deal-making has accelerated. Its stock closed at $19.01 on Wednesday, up 38 percent for the year.
UTEK reported $21.6 million in revenue from the sale of technology rights in the three months that ended June 30, versus $1.5 million in the same quarter last year. It said net income from operations was $9.77 million, up from $28,713 a year earlier. Much of the additional revenue comes from companies whose stock is listed on the Pink Sheets or Over-the-Counter market. The shares of some of those companies trade in small amounts, when they trade at all.
Sharesleuth’s findings also raise questions about the level of due diligence that UTEK performed when approving technology transfers and alliances. Our analysis of the roughly 45 companies that have licensed technology through UTEK turned up no fewer than seven whose executives or large shareholders had previously been charged with violations by the Securities and Exchange Commission, the National Association of Securities Dealers, state regulators or other entities
The SEC recently brought fraud cases against two more of UTEK’s technology partners, HydroFlo Inc. (Pink Sheets: HYRF) and WebSky Inc. (Pink Sheets: WKYN). The SEC said HydroFlo and WebSky were involved in “pump and dump’’ schemes fueled by false announcements about lucrative deals.
An executive behind four other companies that did technology transfers with UTEK in its early years also wound up facing an SEC fraud suit. The case involved a fifth company that had retained UTEK to identify potential license acquisitions.
Still another person who has been chief executive of two more UTEK technology partners was targeted last year in an SEC investigation. A court filing said the SEC was probing whether a group of attorneys, accountants, securities transfer agents, consultants and others were working together to manipulate the share prices of small public companies through misleading fax blasts and spam e-mails( )
UTEK declined to comment on Sharesleuth’s findings. The company never responded to messages left by telephone and e-mail.
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