Solidus Communications Inc (SLDC)

[nodummy]

I think credibility of the management and the credibility of the project go hand in hand, especially with the obvious connection between current and past management - Robert Hainey.

This will be a long post, but please try to follow along.

You do realize who brought a failed piece of property to Sungro in June of 2009 right?

Robert Hainey.

A press release about the investigation:

Investigators probe 'suspicious trading' in Surrey-based mining firm

By David Baines, Vancouver Sun October 2, 2009

The B.C. Securities Commission is probing the affairs of Surrey-based Sungro Minerals Inc. after its shares, which were distributed to seed shareholders for two cents each, soared to $4.75 US on negligible volume and no news that would account for the price hike.
On Monday, BCSC enforcement staff presented their tentative findings to a commission hearing panel in a bid to extend a temporary cease-trade order that had been imposed in July.
Affidavits filed by enforcement staff describe a classic made-in-Vancouver set up: A newly minted Nevada company with a dubious exploration project, dummy seed shareholders, highly suspicious trading, and an undisclosed promoter lurking in the background.
Sungro was incorporated in Nevada in August 2007 by Malkeet Bains, a licensed insurance broker who owns M. Bains Financial Inc. in Surrey.
Bains acquired five million shares at one-hundredth of a cent each, then sold another 118,750 shares to each of 40 family members, close friends and associates, adding another 4.75 million shares.
Weeks later, Sungro acquired an option on three mineral claims in Northern B.C. for $100,000. The down payment was only $2,500, the rest payable over four years. Bains has no professional training or technical credentials in mining.
In April 2008, the company filed a registration statement with the U.S. Securities and Exchange Commission. On Sept. 10, 2008, the 4.75 million shares acquired by the seed shareholders were cleared for re-sale on the bulletin board, but no shares traded until much later.
On Feb. 3 this year, one of the seed shareholders, Narvinder Virk of Abbotsford-- a close friend of Bains -- deposited his share certificate for 118,750 shares at his brokerage account at Canaccord Capital.
Virk asked his broker at Canaccord, Erik Benson, to give Bains trading authority over his account, but the brokerage firm refused because Bains was Sungro's principal.
The first trade occurred on Feb. 19, when Virk sold 30,000 shares at 35 cents through Canaccord.
From June 15 to June 22, he sold his remaining 88,750 shares at prices that steadily increased from 45 cents to $2.50, for total proceeds of $79,885.
Canaccord issued a cheque for that amount, not to Virk, but to a third party, Custom House, an online payments company.
BCSC investigators later learned that $60,000 of this money was disbursed to Bains, and $19,885 to a private company owned by Vancouver promoter Mark McLeary.
McLeary is a certified financial planner and chartered financial planner. He founded McLeary Capital Management Inc., which is located in downtown Vancouver and provides retirement, tax and estate planning to individuals and corporations.
Bains and McLeary are well acquainted. Bains was a seed shareholder in two of McLeary's previous bulletin board deals, Med-Tech Solutions Inc. and Candev Resource Exploration Inc.
BCSC and RCMP investigators wanted to ask Virk why the proceeds of his Sungro stock sales went to McLeary and Bains. Virk agreed to meet with them, but didn't show up. He later advised that he was consulting a lawyer.
On June 19, another seed shareholder, Karn Bahd of Richmond, walked into Canaccord's office with Bains and deposited his certificate for 118,750 shares with Benson at Canaccord.
Bahd also tried to deposit three other certificates belonging to other people, but Benson declined, explaining that Canaccord does not accept deposit of third-party certificates.
Benson reported that Bahd, upon hearing the news, remarked: "That's too bad, I have a lot of shares to sell."

On June 23, Sungro announced it was in the preliminary stages of negotiations for an oil and gas prospect in Wyoming. There was nothing to suggest the property had any real exploration value. BCSC investigators would later learn the deal was being negotiated on Sungro's behalf by McLeary, raising the question as to whether he was working as an undisclosed officer or director.

McLeary had been introduced to the property by Robert Hainey, president of Internet Marketing Solutions Inc., a Rhode Island-based company that ran a stock tout website called stocktopics.com and an e-mail spam service called The Wall Street Alert that came under SEC investigation in 2002.

By this time, four Sungro seed shareholders had transferred their share certificates to Hainey's company. Hainey agreed to pay 40 cents per share, but no money had changed hands. According to Bains, Hainey would pay for the shares when the property deal was completed.

On June 24 -- two days after Virk sold his last shares -- Bahd began selling his shares. During the next two weeks, he sold 6,800 shares at prices that steadily increased from $3.75 to $4.75, for total proceeds of $29,543.
At the $4.75 level, Sungro had a total stock market value of $46.3 million US. This is a ludicrously large amount considering that, by that time, the company had defaulted on its B.C. property option and its total assets consisted of $299 cash. All it had was a vague reference to possible new property acquisition in Wyoming.
Wade Cox, surveillance director for the Investment Industry Regulatory Organization of Canada, which monitors trading on Canadian stock markets, filed an affidavit saying the dramatic and unexplained price increases would have rung alarm bells in his office. He said his staff would have repeatedly intervened, halted trading and asked questions about what was going on and why.
Sungro shares, however, were trading on the bulletin board, where no such surveillance occurs. It wasn't until July 7 that the BCSC halted trading. At that juncture, Canaccord cancelled several outstanding sell orders that Bahd had placed with Benson.
Two days later, BCSC and RCMP investigators met with Bahd. He told them he didn't know Virk and claimed it was a coincidence they shared the same broker. He said he didn't know much about Sungro's business affairs, that he didn't talk to Bains about selling his shares, and that he started selling his shares after discussions "with a friend."
At that point, Virk and Bahd were the only two seed shareholders who had sold any shares. Together they accounted for 45 per cent of the overall trading volume in Sungro shares.
Concerned that the market for Sungro shares had been rigged, BCSC investigators contacted other seed shareholders listed in the company's registration statement.
One of those shareholders, Leah Rigby -- a neighbour of Bahd's -- said she didn't know anything about Sungro and was not aware she had bought any shares.
Another, Melvin Johal, said he bought shares but didn't know where they were. He had no knowledge of Sungro's activities and "seemed surprised" at the lofty share price. When asked if he would sell his shares, and how he would do that, he said he would probably contact Bains.
Another, Sukhdip Rakhra, said his shares were "in a locker." He claimed that he didn't deposit the shares in his brokerage account because he "wanted to keep his financial planning separate from his other stuff." When the investigator told him his shares were now worth over $1 million, "he seemed unexcited." Asked whether he would sell some of his shares, he replied, "No, I'm just going to let them continue to grow" -- an absurd strategy for a company that has no business.
The investigator remarked that, based on his discussion with Rakhra, "I am concerned he may not have possession and control of his shares."
The BCSC has issued a notice of hearing against Sungro, citing "suspicious trading activity" and surmising that "persons may have engaged in conduct that resulted in or contributed to an artificial price for Sungro shares."
After enforcement staff presented the evidence they had gathered to date, and asked for more time to complete its investigation, the commission hearing panel agreed to extend the cease-trade order to Dec. 18.
I wouldn't be surprised if, before it's all over, several of the individuals in this dubious deal are added as respondents.

[e-mail]



Malkeet Baines left in December of 2009, but he left being owed $24,000 by the company:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=6947845


Robert Hainey is the one that brought the Conglomerate Mesa property to Sungro in July of 2009:

http://www.sec.gov/Archives/edgar/data/1427644/000143774910000725/ex10-6.htm

EX-10.6 2 ex10-6.htm EXHIBIT 10.6
Exhibit 10.6
CONSULTING AND FEE AGREEMENT

This Agreement, dated as of July 1st, 2009, is between Internet Marketing Solutions, Inc. / Robert Hainey President, (“CONSULTANT") and Sungro Minerals, Inc. and affiliates ("CLIENT" or “Sungro”), (collectively the Parties).

RECITALS

A.CLIENT desires to retain CONSULTANT to render consulting and advisory services for CLIENT on the terms and conditions set forth in this Agreement and CONSULTANT desires to be retained by CLIENT on such terms and conditions.

B. Internet Marketing Solutions, Inc. has introduced Sungro Minerals and its affiliates to Steve Van Ert/Noel Cousins (Conglomerate Mesa) for the purpose of Conglomerate Mesa to merge with Sungro Minerals, Inc. (stock symbol SUGM) a public company controlled by Mal Bains and its affiliates.

C. This agreement will set forth the understanding between the Parties subsequent to a Definitive Agreement between Conglomerate Mesa and Sungro Minerals, Inc.

NOW, THEREFORE, CLIENT and CONSULTANT agree as follows:

Retention of Consultant;

1. Services to be Performed. CLIENT hereby retains CONSULTANT for the term of this Agreement to perform the consulting services on an as needed basis. These services will include but will not be limited to business development, strategic planning, technology implementation, public relations, and mergers and acquisitions. In rendering Services hereunder, CONSULTANT shall be acting as an independent contractor and not as an employee or agent of CLIENT. As independent contractors, neither CONSULTANT nor CLIENT shall have any authority, express or implied, to commit or obligate the other in any manner whatsoever, except as specifically authorized from time to time in writing by an authorized representative of CONSULTANT or CLIENT, as the case may be, which authorization may be general or specific. Nothing contained in this Agreement shall be construed or applied to create a partnership. CONSULTANT shall be responsible for the payment of all federal, state or local taxes payable with respect to all amounts paid to CONSULTANT under this Agreement.

2. Compensation for Consulting Services. For consulting services with Sungro and Conglomerate Mesa, Inc. the Parties agree that CLIENT shall pay to CONSULTANT ten percent (10%) of the gross value of the project received by CLIENT including cash, stock and stock purchase warrants.

3. Billing. CONSULTANT shall invoice CLIENT for any compensation due as a result of a deal signed with Conglomerate Mesa, Inc. and Sungro. Payment on invoices so provided shall be due upon receipt.

4. Confidential Information. Confidential information of any nature that either party acquires regarding any aspect of the other party's business shall be treated in strict confidence. Information so obtained shall not be divulged, furnished or made accessible to third parties without the written permission of the other party to this Agreement. Both parties retain the right to do business with third parties in matters that may be competitive with the interests of the other party to this Agreement. However, the confidentiality constraints above shall be binding and have precedence over these business matters. Upon termination of this Agreement, the terms of this paragraph shall remain in effect for three years
...
IN WITNESS WHEREOF, CLIENT and CONSULTANT have executed this Agreement as of the date set forth in the first paragraph.

/s/ Robert Hainey
Robert Hainey, Internet Marketing Solutions, Inc.

/s/ Mal Bains
Mal Bains, CEO Sungro Minerals, Inc.



The most recent 10Q shows more big payments to Robert Hainey this year after the new CEO took over and a payment to Thomas Craft which helps to tie some connections together which won't be mentioned yet in detail in this post:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7509369

In February 2010, the Company issued 500,000 common shares to Seacoast Funding, Inc. as compensation for consulting services rendered. The shares were issued at a price of $0.50 per share the price on the closing date of the consulting agreement.

In February 2010, the Company issued 2,000,000 common shares to Internet Marketing Solutions, Inc. as compensation for consulting services rendered. The shares were issued at a price of $1.00 per share the same price as the shares were issued in connection with the Conglomerate Mesa closing.

In June 2010, the Company issued 5,500,000 common shares to Internet Marketing Solutions, Inc. as compensation for consulting services rendered. The shares were issued at a price of $0.39 per share the closing market price on the date of issuance.

In June 2010, the Company issued 1,000,000 common shares in connection with the conversion of a $100,000 convertible debenture issued in December 2009. The conversion was priced at $0.10 per share.

In August 2010, the Company issued 1,000,000 common shares to Thomas Craft, Jr., a member of the Company’s board of directors at a price of $0.14 per share as compensation. The price was the closing market price on the date of grant.

Under a consulting agreement between Sungro and Internet Marketing Solutions, Inc. (IMS) provides that IMS will receive a Consulting Fee of ten percent (10%) of the gross value of the project received by Sungro including cash, stock and stock purchase warrants.


I'm sure you've seen the contract:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=6786109


From the Nov 20, 2009 10Q for the Period Ending August 31, 2009:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=6906108

Our Current Business
We are an exploration stage company. To date, our activities have been limited to organizational matters, acquiring an option to acquire (1) three mineral claims called the Chevron Claims in northern British Columbia and engaging a geologist to develop a work program on the Chevron Claims; and (2) negotiating the acquisition of the Conglomerate Mesa Claims and the development of the claims. We failed to make the necessary payments to keep in good standing the option to acquire the Chevron Claims, and subsequently lost the right to exercise this option, and have made partial payments on the Conglomerate Mesa Claims and expect to complete the payments before the end of November 2009. Our company has not generated revenues since inception and has accumulated losses of $192,515 since inception. We do not anticipate earning revenues until such time as we have entered into commercial production of any mineral or oil and gas properties we acquire. We can provide no assurance that we will discover commercially exploitable levels of mineral resources or oil and gas resources on properties we acquire, or if such resources are discovered, that we will enter into commercial production of properties we acquire.


On the 10K filed on March 18, 2010 for the period ending Nov 30, 2009 Sungro explains that it missed the November 2009 deadlines, but that the two parties agreed to extend the deadline to March 22, 2010:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7134504

By written, mutual agreement between the parties, the final closing of the Agreement was extended to March 22, 2010. Under the agreement, Sungro was required to make all filings related to the Conglomerate Mesa Properties, to maintain the Conglomerate Mesa Claims in good standing by preparing and filing and paying claim fees to the Bureau of Land Management, and keeping the claim area free and clear of all liens and encumbrances.

This part from the same 10K I strongly question because it contradicts what the previous owners, Timberline Resources Inc were saying about the permits:

The Company’s operations if and when they begin, will be subject to various federal, state, and local permitting and environmental regulations. The Conglomerate Mesa Claims were previously permitted by several companies. These permits included roadways, drilling, and preliminary mining approvals. The Company believes that some or all of these permits can be transferred to its name following filings and updates to the plan of exploration and development.


Here is what Timberline Resources (the previous owner of the property) had to say about he property and the required permits:

http://www.sec.gov/Archives/edgar/data/1288750/000091228208001631/timberline8k_110708.htm

Given the Company’s newly refined focus, along with a current market environment that does not attribute the value to early-stage, high-cost exploration prospects necessary for their advancement, Timberline announced today that it has formally withdrawn its application to the Bureau of Land Management (BLM) for an exploration drilling program at Conglomerate Mesa and its lease agreement for the project has been terminated.



The initial closing payment was made according to the April 14, 2010 10Q filing:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7186250

The Company completed the remaining cash payments required in connection with the closing of the Mineral Agreement (the “Mineral Agreement”) for the prospect known as the "Conglomerate Mesa Claims". By mutual agreement between the Parties, the closing of the Mineral Agreement had been extended to March 31, 2010.

And some updates on the project:

Our Current Business
We are an exploration stage company. To date, our activities have been limited to organizational matters, the negotiation and acquisition of the Conglomerate Mesa Claims and the development of these claims. We have completed all payments and stock issuances in connection with the acquisition of the Conglomerate Mesa Claims and expect to commence preparation of the NI43-101 Report to establish the expected value of the claims in mid 2010. Our company has not generated revenues since inception and has accumulated losses of $3,130,706 since inception. We do not anticipate earning revenues until such time as we have entered into commercial production of any mineral or oil and gas properties we acquire. We can provide no assurance that we will discover commercially exploitable levels of mineral resources or oil and gas resources on properties we acquire, or if such resources are discovered, that we will enter into commercial production of properties we acquire.



The July 15, 2010 10Q provides more updates:

Consulting and Professional Fees
Consulting fees include fees in connection with the acquisition of the Conglomerate Mesa claims, and structuring of future financings. Professional fees include our accounting and auditing expenses incurred in connection with the preparation and audit of our financial statements and professional fees that we pay to our legal counsel. Our accounting and auditing expenses were incurred in connection with the preparation of our audited financial statements and unaudited interim financial statements. Our legal expenses represent amounts paid to legal counsel in connection with our ongoing reporting requirements, and the representation of the Company before the BCSC in connection with the investigation of potential “trading irregularities”. Consulting and legal expenses will be ongoing during fiscal 2010 due to our continuing representation before the BCSC and our ongoing reporting obligations under the Securities Exchange Act of 1934 and development of the Canadian National Instrument 43-101 filings.


Our Current Business
We are an exploration stage company. To date, our activities have been limited to organizational matters, the negotiation and acquisition of the Conglomerate Mesa Claims and the development of these claims. We have completed all payments and stock issuances in connection with the acquisition of the Conglomerate Mesa Claims and have begun preparation of the NI43-101 Report to establish the expected value of the claims in mid 2010. In July 2010, we received a preliminary report from our professional geologist indicating a significant value to the mineralization’s found on the property. Our company has not generated revenues since inception and has accumulated losses of $3,251,312 since inception. We do not anticipate earning revenues until such time as we have entered into commercial production of any mineral or oil and gas properties we acquire. We can provide no assurance that we will discover commercially exploitable levels of mineral resources or oil and gas resources on properties we acquire, or if such resources are discovered, that we will enter into commercial production of properties we acquire.


The initial report part is interesting because that contradicts the findings of the previous owner, Timberline Resources Inc. Also interesting that no details of the report are shared. Just a vague statement.

http://www.sec.gov/Archives/edgar/data/1288750/000105291809000085/trc10qfeb1209s.htm

http://www.sec.gov/Archives/edgar/data/1288750/000105291809000278/trcs1a3jun209s.htm

The Company announced it will not focus on early stage properties or continue to expend capital or time on the Conglomerate Mesa project unless it can be done at a minimal cost to the company. Company management believes these projects have value; however, given the complexities and challenges of some of the property agreements when viewed in the context of market realities, the current economic environment, and our strategic partnership with SMD, a more refined focus is warranted at this time

For most of the year we spent considerable time and expense on the advancement of the Conglomerate Mesa project in California. While we feel there is still potential in the area, the lack of flexibility by the property owners in restructuring our agreement to recognize the economic crisis, changing industry dynamics, challenges in California, and the prevailing political climate did now allow for us to continue advancement of the project. Thus, we decided subsequent to year end to drop the property and take a write-down of the project

We do not plan to focus on early stage properties or expend capital or time on the larger Conglomerate Mesa type projects unless it can be done at a minimal cost to the Company, and not at the cost of advancing or acquiring more advanced stage properties.



The 10Q filed in October 2010 showed no changes or advances in the project from May 31, 2010 to August 31, 2010:

http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=7509369

Our Current Business
We are an exploration stage company. To date, our activities have been limited to organizational matters, the negotiation and acquisition of the Conglomerate Mesa Claims and the development of these claims. We have completed all payments and stock issuances in connection with the acquisition of the Conglomerate Mesa Claims and have begun preparation of the NI43-101 Report to establish the expected value of the claims in mid 2010. In July 2010, we received a preliminary report from our professional geologist indicating a significant value to the mineralization’s found on the property. Our company has not generated revenues since inception and has accumulated losses of $5,811,817 since inception. We do not anticipate earning revenues until such time as we have entered into commercial production of any mineral or oil and gas properties we acquire. We can provide no assurance that we will discover commercially exploitable levels of mineral resources or oil and gas resources on properties we acquire, or if such resources are discovered, that we will enter into commercial production of properties we acquire.



So far no NI43-101 Report has been done, but let's examine more details:

Just yesterday a geologist was suspended for giving an false NI43-101 Report. He gave what investigators called an "an excessively rosy picture of prospect in Arizona"

Read more: http://www.vancouversun.com/business/David+Baines+Association+suspends+geologist+disclosure+violations/3921463/story.html#ixzz17GKzJKMh


In May Sungro announced in a Press Release that they commissioning a 43-101 Style Report.

http://finance.yahoo.com/news/Sungro-Minerals-Announces-the-iw-4214367028.html?x=0&.v=1

Randall Moore, acting as an independent "consultant" to the company, has been asked by the Board of Sungro to begin work on a 43-101 style report by compiling all of the historic data and conducting initial field investigations for data verification. Mr. Moore has an extensive background in mineral exploration with over 30 years of experience and is a Registered Professional Geologist and a "Qualified Person" as defined under NI 43-101.

What is the difference between a Style Report and a Regular Report?

I could find no other company ever that has referred to their 43-101 as a Style Report.


On July 6, 2010 Sungro put out a Press Release that they have received the Preliminary 43-101 Information:

Sungro Minerals, Inc. (OTC.BB:SUGO - News) today announced it is in receipt of a preliminary NI-43101 provided by Randall Moore, the geologist contracted by the Company.

CEO, Fred Pucillo, stated, "Although this report is preliminary, we are encouraged by the detailed analysis by Mr. Moore giving the large volume of documents before him. The report will include all relevant data from surface samples and drilling with an interpretation of that data. He will require the engagement of computer services for maps and plates to go into the final report and develop spreadsheets for this data."

Interesting that No actual data is shared.

Now it's been 4 more months and still no data has been shared. No new updates of the progress of this project. No statements saying that Sungro sent in an application to the Bureau of Land Management (BLM) for an exploration drilling program. The previous owners, Timberline Resources never did this application.



There are many other issues. One source talked to Timberline Resources to find out further information about why the dropped the property. Here is that person's statement:

I called Timberline today....they dropped the Mesa property as there is the very real possibility that the area will be added to wilderness. It has been a study area for some time, and supposedly was removed from that status.

Another source shared this information:

I also emailed a BLM person, and a person with Cal Wild, who was fighting to get wilderness status for the C Mesa site.




Sungro lost mining properties in the past because they didn't have the funds to move forward with the projects. With an ongoing investigation and all the other issues going on with the Canadian Stock Exchange and the company admitting in it's SEC filings that it has no business operations that bring in revenues I just don't see how they can cover all the expenses of this expensive project of readying the Mesa site for production, especially considering that the last owner of the property decided the property didn't have enough potential to even spend the money to develop the project and a write off on the property was a better economic decision than maintaining ownership of the property.

Frederick Pucillo's appointment as CEO makes you wonder how much influence Robert Hainey may have had with that decision especially since the two are long time buds and Hainey still has a lot to gain by the mesa project staying alive and moving forward (or at least maintaining the perception of progress)


Fact is there are a lot of connections going on with this Sungro company behind the scenes between the likes of Frederick Pucillo, Robert Hainey, Martin Bolodian, Thomas Craft, Jr., Nick Mastroianni, and Bruce Bookbinder. Some questionable activities. Remember those names for the future.