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EX-1 - EXHIBIT 5.1 LAWYER'S OPINION - AUSCRETE Corpopinion.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


FORM S-1/A

Amendment No. 13


REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933


Auscrete Corporation
(Exact Name of registrant in its charter)
 
Wyoming 3272 27-1692457

(State or jurisdiction of incorporation

or organization)

(Primary Standard Industrial Classification

Code Number)

(I.R.S. Employer Identification No.)
 

504 East First St.

P.O. Box 847

Rufus, OR 97050

Our telephone and fax number is (541) 739-8200

(Address and telephone number of principal executive offices)
 

Pocket Counsel, Inc.

c/o Luc Nguyen, Esq.

1192 Draper Pkwy. #244

Draper, UT 84020

Telephone (801) 349-8274 Fax (866)-277-4061
(Name, address and telephone number of agent for service)

 

Approximate date of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.


If any of the securities being registered are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box x.


If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. ¨


If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. ¨


If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. ¨


Indicate by a check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accredited filer or a smaller reporting company.


Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer ¨ Smaller reporting company x

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY DETERMINE.



CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered Number of shares of common stock to be registered Dollar amount of shares to be registered Proposed maximum offering price per share (1) Proposed maximum aggregate offering price Amount of registration fee (2)
Shares offered by Company 10,000,000 $3,000,000 $0.30 $3,000,000 $343.80
Shares offered by SellingShareholders 1,742,500 $522,750 $0.30 $522,750 $59.91

 

(1)

 

This is an initial offering of securities by the registrant and no current trading market exists for our common stock. The Offering price of the common stock offered hereunder has been arbitrarily determined by the Company and bears no relationship to any objective criterion of value. The price does not bear any relationship to the assets, book value, historical earnings or net worth of the Company. In determining the Offering Price, the Company considered such factors as the prospects, if any, of similar companies, the previous experience of management, the Company's anticipated results of operations, the present financial resources of the Company, and the likelihood of acceptance of this Offering.


(2) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(a)

 
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED FEBRUARY 10, 2012


PRELIMINARY PROSPECTUS

AUSCRETE CORPORATION


Shares of Common Stock

1,500,000 Minimum - 10,000,000 Maximum

$0.30 per share


Auscrete Corporation is offering the shares of common stock on a self-underwritten, best-efforts basis, a minimum of 1,500,000 and a maximum of 10,000,000 shares of its common stock directly through our directors. In addition to the Shares we are offering, the selling shareholders named in this prospectus ("Selling Shareholders") are offering up to 1,742,500 shares of our common stock at a fixed price of $0.30 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. Notwithstanding the previous sentence, our officers and directors will sell their shares of common stock at a fixed price of $0.30 per share through the term of this Offering regardless of the prevailing market prices.


We will not receive any of the proceeds from the sale of shares of our common stock offered by the Selling Stockholders. The intended methods of communication include telephone and personal contact. Our directors will not receive any commissions or other compensation from the offering for selling the Shares on our behalf. The Shares will be offered at a fixed price of $0.30 per share for a period not to exceed 18 months from the date of this prospectus.


The proceeds from the sale of the shares in this offering will be payable to Auscrete Corporation Stock Holder Account f/b/o Auscrete Corporation. All subscription funds will be held in this non-interest bearing Stock Holder Account at Banner Bank, Hermiston, Oregon pending the achievement of the Minimum Offering and no funds shall be released to Auscrete Corporation until such time as the minimum proceeds are raised. If the minimum offering is not achieved within 18 months of the date of this prospectus, all subscription funds will be returned to investors promptly without interest or deduction of fees.


Although we have verbally agreed to engage Glendale Securities, Inc., a registered broker-dealer and market maker, to apply with the Financial Industry Regulatory Authority to have our common stock eligible for quotation on the OTC Bulletin Board, public trading of our common stock may never materialize or, even if materialized, trading may not be sustained. A market for our Common Stock may never develop. For more information, see the section titled "Plan of Distribution" herein.


The offering may terminate on the earlier of: (i) the date when the sale of all 10,000,000 shares is completed, (ii) anytime after the minimum offering of 1,500,000 shares of common stock is achieved, or (iii) 18 months from the effective date of this document.

 

THE PURCHASE OF THE SECURITIES OFFERED THROUGH THIS PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. SEE SECTION ENTITLED "RISK FACTORS" ON PAGES 5-9.

 

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

 

Any broker/dealers who act in connection with the sale of the shares will be deemed to be "underwriters" within the meaning of the Securities Acts of 1933, and any commissions received by them and any profit on any resale of the shares as a principal might be deemed to be underwriting discounts and commissions under the Securities Act.

 

As purchasers of shares of a shell company, the Selling Shareholders are considered underwriters for purposes of this Offering and shall be deemed to be engaged in a distribution of our common stock in connection with the resale of their shares and therefore must comply with applicable securities laws.

We intend to sell our shares at $0.30 per share. We determined this offering price arbitrarily by adding a $0.10 premium to the last sale price of our common stock to investors. This Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

 

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

1

 

 

TABLE OF CONTENTS

  Page
Summary 3
   
Summary Financial Information 4
   
Risk Factors 5
   
Forward-Looking Statements 9
   
Use of Proceeds 10
   
Determination of Offering Price 10
   
Dilution 10
   
Selling Shareholders 11
   
Plan of Distribution 12
   
Description of Securities 13
   
Interest of Named Experts and Counsel 14
   
Description of Business 14
   
Legal Proceedings 23
   
Market for Common Equity and Related Stockholder Matters 23
   
Plan of Operations 25
   
Changes in and Disagreements with Accountants 28
   
Available Information 29
   
Directors, Executive Officers, Promoters and Control Persons 29
   
Executive Compensation 31
   
Security Ownership of Certain Beneficial Owners and Management 31
   
Certain Relationships and Related Transactions 32
   
Disclosure of Commission Position of Indemnification for Securities Act Liabilities 32
   
Financials Index and Statements 33

2

 

 

SUMMARY

PROSPECTIVE INVESTORS ARE URGED TO READ THIS PROSPECTUS IN ITS ENTIRETY.

 

Initially, we intend to manufacture lightweight cellular concrete wall, roof and interior panels for use in the construction of residential housing. Our principal business will be to supply builders and contractors with pre-cast wall, roof and interior panels for use in the construction of single-family homes. Our aim will be to offer pre-cast panels that are not only affordable, energy efficient and eco-friendly but have superior fireproofing and sound and thermal insulation qualities. Potentially, we may begin constructing homes ourselves.

 

We were incorporated on December 31, 2009 under the laws of the state of Wyoming. Our principal offices are located at 504 East First St. Rufus, OR 97050 and our telephone number is (541) 739-8200.

 

THE OFFERING:

 

Securities Being Offered by Auscrete A minimum of 1,500,000 and up to 10,000,000 shares of common stock.
Securities Being Offered by Selling Shareholders 1,742,500 shares of common stock. In addition to the Shares we are offering, the Selling Shareholders named in this prospectus are offering up to 1,742,500 shares of our common stock at a fixed price of $0.30 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. Notwithstanding the previous sentence, our officers and directors will sell their shares of common stock at a fixed price of $0.30 per share through the term of this Offering regardless of the prevailing market prices. We will not receive any of the proceeds from the sale of shares of our common stock offered by the Selling Stockholders.
Offering Price We will sell our shares at $0.30 per share. We determined this offering price arbitrarily by adding a $0.10 premium to the last sale price of our common stock to investors.
Terms of the Offering We will conduct the offering on a self-underwritten, best-efforts basis directly through our directors, John Sprovieri and Clifford Jett.
Termination of the Offering The offering may terminate on the earlier of: (i) the date when the sale of all 10,000,000 shares is completed, (ii) anytime after the minimum offering of 1,500,000 shares of common stock is achieved, or (iii) 18 months from the effective date of this document.
Use of Proceeds We will use the net proceeds from this offering for general corporate purposes, including working capital and capital expenditures, and potentially for establishing our manufacturing facilities, distribution channels and construction operations.

 

3

 

 

SUMMARY FINANCIAL INFORMATION

 

The following financial information summarizes the more complete historical financial information at the end of this prospectus.

BALANCE SHEET   As of December 31, 2010 (Audited)  
Total Assets   $ 9,069  
Total Liabilities   $ 0  
Stockholders Equity   $ 9,069  
         
         
INCOME STATEMENT        
Revenue   $ 0  
Total Expenses (Organization Costs)   $ (204,400)  
Net Income (Loss)   $ (204,400)  

Note: Expenses were paid for with share issue – See Audited Statements

 

BALANCE SHEET   As of December 31, 2011 (Unaudited)  
Total Assets   $ 144,069  
Total Liabilities   $ 0  
Stockholders Equity   $ 144,069  
         
         
INCOME STATEMENT        
Revenue   $ --  
Total Expenses   $ --  
Net Loss   $ --  

 

4

 

 

RISK FACTORS

 

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. The price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.

 

WE WILL NEED A MINIMUM OF APPROXIMATELY $450,000 TO PROCEED WITH OUR BUSINESS PLAN AND IF UNABLE TO RAISE THAT AMOUNT NET OF OFFERING COSTS, WE WILL HAVE TO REVISE OUR BUSINESS PLAN OR CLOSE OUR BUSINESS.

 

We had minimal working capital of $9,069 as of December 31, 2011. We currently do not have any manufactured product and we have no income. Our business plan calls for expenditures in the amount of $450,000 to get our initial product to market. If we are able to sell 100% of the shares offered by Auscrete Corporation or even 15% of the shares offered by Auscrete Corporation we should be able to meet this objective. Even after our initial products are ready to sell, there can be no assurance they will generate sufficient revenues to sustain our business operations. The $450,000 needed for funding at the present time may not be available to us. In the event we do not sell at least 15% of the offering, it will be necessary to suspend operations and seek alternative sources of funding. If we are not successful in obtaining funding, we will not be able to achieve revenues and our business will likely fail.

 

THE COMPANY WILL HAVE WIDE DISCRETIONARY USE OF PROCEEDS UNDER THIS OFFERING.

 

Management has broad discretion with respect to the specific application of the net proceeds of this offering, There can be no assurance that determinations ultimately made by the Company relating to the specific allocation of the net proceeds of this offering will permit the Company to achieve its business objectives. SEE "Propored Business".

 

BECAUSE WE HAVE NOT YET COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK OF BUSINESS FAILURE.

 

We were incorporated on December 31, 2009 and to date have been involved primarily in organizational activities. We have not earned revenues as of the date of this prospectus.

 

Accordingly, you cannot evaluate our business, and therefore our future prospects, due to a lack of operating history. Potential investors should be aware of the difficulties normally encountered by development stage companies and the high rate of failure of such enterprises. In addition, there is no guarantee that we will be able to expand our business operations. Even if we expand our operations, at present, we do not know precisely when this will occur.

 

WE HAVE NOT GENERATED REVENUES AND DO NOT EXPECT TO GENERATE REVENUES UNTIL A SUCCESSFUL CONCLUSION OF THIS OFFERING.

 

We have not generated any revenues as of the date of this prospectus and do not expect to generate revenues until we obtain funding from this offering. Upon completion of our commencement stage, we anticipate that we will incur increased operating expenses. We therefore expect to incur some losses into the foreseeable future. Potential investors should be aware of the difficulties we yet face in the implementation of our business plan. These risks include without limitation:


  -- Completion of our manufacturing facilities and

 

  -- The acceptance of our products into the market place to a sufficient extent that our operations become economically viable.

 

The likelihood of success must also be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the commencement of our business plan. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail.

 

INVESTORS WILL BE UNABLE TO SELL THEIR SECURITIES IF NO MARKET DEVELOPS FOR THOSE SECURITIES.

 

No market exists at the present time for our common shares. Investors in the offering will purchase securities that cannot be resold by those investors since no market exists. We intend to apply for admission to quotation of our securities on the OTC Bulletin Board after this prospectus is declared effective by the SEC. If for any reason our common stock is not quoted on the OTC Bulletin Board or a public trading market does not otherwise develop, purchasers of the shares may have difficulty selling their common stock should they desire to do so.”


BECAUSE OUR PRODUCTS ARE SPECIALTY PRODUCTS THAT WILL APPEAL TO ONLY A PORTION OF THE U.S. POPULATION, UNLESS WE CAN ACHIEVE BROAD BASED MARKETING SUCCESS IT IS LIKELY OUR CONCRETE CASTING BUSINESS WILL NOT SUCCEED.

 

The type of products which we will produce are not currently as widely used in the construction of residential housing as competing materials such as drywall, wood, gypsum, or plaster panels. To succeed we will need to market our potential products to a wide geographic area to appeal to a wider market. If we cannot become the supplier of pre-cast cellular concrete wall, roof and interior panels to a broad base of builders and contractors, it will be difficult for us to achieve financial success and investors may lose their investments.

 

WE DEPEND ON JOHN SPROVIERI WHOM WE MAY NOT BE ABLE TO RETAIN, IN WHICH EVENT WE COULD NOT CONTINUE TO DEVELOP OUR BUSINESS PLAN.

 

John Sprovieri is our only officer and our principal director who has the expertise to run and oversee the development of our business. We would not be able to retain Mr. Sprovieri if he should die, become disabled or become engaged in other business pursuits to the extent he cannot devote sufficient time to our business. In such event, we could not prosecute our business plan unless we can replace Mr. Sprovieri. It is uncertain whether we would be able to do so. In addition, we have no key-man life insurance on Mr. Sprovieri.

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THE INDUSTRY IN WHICH WE INTEND TO COMPETE IS HIGHLY CYCLICAL AND ANY DOWNTURN RESULTING IN LOWER DEMAND OR INCREASED SURPLUS WOULD HAVE A MATERIALLY ADVERSE IMPACT ON OUR FINANCIAL RESULTS.

 

The building products manufacturing and distribution industry is subject to cyclical market pressures caused by a number of factors that are out of our control, such as general economic and political conditions, levels of new construction, interest rates and population growth. To the extent that cyclical market factors adversely impact overall demand for environmentally friendly building products or the prices that we can charge for our products, our net sales and margins would likely decline in the same time frame as the cyclical downturn occurs. Because much of our overhead and expense is relatively fixed in nature, a decrease in sales and margin generally could have a significant adverse impact on our results of operations. Also, to the extent our potential customers experience downturns in business; our ability to collect our receivables could be adversely affected. Finally, the unpredictable natures of the cyclical market factors that impact our industry make it difficult to forecast our operating results.

 

OUR SHARES OF COMMON STOCK ARE SUBJECT TO THE "PENNY STOCK" RULES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE TRADING MARKET IN OUR SECURITIES WILL BE LIMITED, WHICH WILL MAKE TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.

 

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks." Penny stocks generally are 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). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating 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 agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.

 

PRODUCT LIABILITY CLAIMS AGAINST US COULD RESULT IN ADVERSE PUBLICITY AND POTENTIALLY SIGNIFICANT MONETARY DAMAGES.

 

Like other manufacturers of products that are used by consumers, we face an inherent risk of exposure to product liability claims in the event that the use of our pre-cast concrete products results in injury. In addition, since we have no operating history, we cannot predict whether or not product liability claims will be brought against us in the future, or the effect of any resulting negative publicity on our business. Moreover, we may not have adequate resources in the event of a successful claim against us. We will rely on obtaining general liability insurance to cover product liability claims. The successful assertion of product liability claims against us could result in potentially significant monetary damages and if our insurance protection is inadequate to cover these claims, they could require us to make significant payments.

 

BECAUSE THE MARKETS IN WHICH WE COMPETE ARE HIGHLY COMPETITIVE AND MANY OF OUR COMPETITORS HAVE GREATER RESOURCES THAN US, WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY AND WE MAY BE UNABLE TO GAIN MARKET SHARE.

 

We compete with a large number of competitors in the construction supply business. In addition to other companies that manufacture and distribute pre-cast aerated concrete wall, roof and interior panels, we will compete with companies that supply panels made of alternative materials such as drywall, gypsum, plaster and wood. In addition, we will compete with local, regional and national home improvement wholesalers and retailers who offer panels directly to the public. We expect to face increased competition in the future. Further, many of our potential competitors have longer operating histories, greater name recognition, access to larger customer bases and significantly greater financial, sales and marketing, manufacturing, distribution, technical and other resources than us. As a result, they may be able to respond more quickly to changing customer demands or to devote greater resources to the development, promotion and sales of their products than we can. It is possible that new competitors or alliances among existing competitors could emerge and rapidly acquire significant market share, which would harm our business. If we fail to compete successfully, our business would suffer and we may lose or be unable to gain market share.

7

 

 

THE DEMAND FOR PRODUCTS REQUIRING SIGNIFICANT INITIAL CAPITAL EXPENDITURES SUCH AS OUR PRE-CAST CONCRETE PRODUCTS IS AFFECTED BY GENERAL ECONOMIC CONDITIONS.

 

The United States and international economies have recently experienced a period of slow economic growth. A sustained economic recovery is uncertain. In particular, terrorist acts and similar events, continued turmoil in the Middle East or war in general could contribute to a slowdown of the market demand for products that require significant initial capital expenditures, including demand for new residential buildings. In addition, increases in interest rates may increase financing costs to customers, which in turn may decrease demand for our products. If the economic recovery slows down as a result of the recent economic, political and social turmoil, or if there are further terrorist attacks in the United States or elsewhere, we may experience decreases in the demand for our pre-cast concrete products, which may harm our operating results.

 

WE WILL RELY PRIMARILY UPON COPYRIGHT AND TRADE SECRET LAWS AND CONTRACTUAL RESTRICTIONS TO PROTECT OUR PROPRIETARY RIGHTS, AND, IF THESE RIGHTS ARE NOT SUFFICIENTLY PROTECTED, OUR ABILITY TO COMPETE AND GENERATE REVENUE COULD SUFFER.

 

We will seek to protect our proprietary manufacturing processes, documentation and other written materials primarily under trade secret and copyright laws. We will also require employees and consultants with access to our proprietary information to execute confidentiality agreements. The steps taken by us to protect our proprietary information may not be adequate to prevent misappropriation of our technology. In addition, our proprietary rights may not be adequately protected because:

 

  People may not be deterred from misappropriating our technologies despite the existence of laws or contracts prohibiting it;

 

  Policing unauthorized use of our intellectual property may be difficult, expensive and time-consuming, and we may be unable to determine the extent of any unauthorized use; and

 

  Reverse engineering, unauthorized copying, or other misappropriation of our proprietary technologies could enable third parties to benefit from our technologies without paying us for doing so. Any inability to adequately protect our proprietary rights could harm our ability to compete, to generate revenue and to grow our business.

 

WE MAY NOT BE ABLE TO MANAGE OUR FUTURE GROWTH EFFECTIVELY.

 

We may be unable to manage future growth. To successfully manage our growth and handle the responsibilities of being a public company, we believe we must effectively:

 

  Hire, train, integrate and manage additional qualified engineers for research and development activities, sales and marketing personnel, and financial and information technology personnel;

 

  Retain key management and augment our management team, particularly if we lose key members;

 

  Continue to enhance our customer resource management and manufacturing management systems;

 

  Implement and improve additional and existing administrative, financial and operations systems, procedures and controls;

 

  Expand and upgrade our technological capabilities; and

 

  Manage multiple relationships with our customers, suppliers and other third parties.

 

We may encounter difficulties in effectively managing the budgeting, forecasting and other process control issues presented by rapid growth. If we are unable to manage our growth effectively, we may not be able to take advantage of market opportunities, satisfy customer requirements, execute our business plan or respond to competitive pressures.

8

 

 

THE SUCCESS OF OUR BUSINESS WILL DEPEND ON THE CONTINUING CONTRIBUTIONS OF OUR KEY PERSONNEL.

 

We will rely heavily on the services of key executive officer and directors including, John Sprovieri, our Chief Executive Officer and Director, Clifford Jett, our Director, and William Beers, our Director. The loss of services of our executive officer or any director could adversely impact our operations. We believe our future success will depend upon our ability to retain these key individuals and our ability to attract and retain other skilled managerial, engineering and sales and marketing personnel. However, we cannot guarantee that any employee will remain employed at the Company for any definite period of time.

 

OUR MANAGEMENT WILL HAVE BROAD DISCRETION IN USING THE NET PROCEEDS OF THIS OFFERING, AND YOU WILL NOT HAVE THE OPPORTUNITY, AS PART OF YOUR INVESTMENT DECISION, TO ASSESS WHETHER THE PROCEEDS ARE BEING USED APPROPRIATELY.

 

We intend to use the net proceeds from this offering for general corporate purposes, including working capital and capital expenditures. Depending on future developments and circumstances, we may use some of the proceeds for other purposes. We do not have more specific plans for the net proceeds from this offering. Therefore, our management will have broad discretion in applying the net proceeds of this offering. The net proceeds could be applied in ways that do not improve our operating results. The actual amounts and timing of these expenditures will vary significantly depending on a number of factors, including the amount of cash used in or generated by our operations and the market response to the introduction of our product offerings.

 

WE INCUR SUBSTANTIAL COMPLIANCE COSTS AS A PUBLIC COMPANY.

 

As a public company, we will incur significant legal, accounting and other expenses. In addition, the Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC has required changes in corporate governance practices of public companies.

 

ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.

 

We may raise additional capital in order for our business plan to succeed. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of investors' shares.

 

WE DO NOT EXPECT TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.

 

We do not expect to pay cash dividends on our common stock at any time in the foreseeable future. The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our board of directors will consider. Since we do not anticipate paying cash dividends on our common stock, a return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.

 

WE HAVE NO EXPERIENCE AS A PUBLIC COMPANY.

 

We have never operated as a public company. We have no experience in complying with the various rules and regulations, which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.

 

FORWARD-LOOKING STATEMENTS

 

This discussion contains certain statements, which may be viewed as forward-looking statements that involve risks and uncertainties. When used herein, the words "believes", "anticipates", "expects" and similar expressions are intended in certain circumstances, to identify forward-looking statements. Such statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those projected, including the risks of a startup company becoming profitable and raising the funds required to do so. Given these uncertainties, you are cautioned not to place undue reliance on such statements. There are no assurances the company can fulfill such forward-looking statements. Such forward-looking statements are only predictions; actual events or results may differ materially as a result of risks facing the company. Some of these risks include changes in government regulations, lack of financing and undercapitalization, inability to compete on a price level with competitors, loss of supply contracts, and increases in shipping costs

9

 

 

USE OF PROCEEDS

 

We will not receive the proceeds from the sale of any shares of our common stock offered by the Selling Shareholders (See "Selling Shareholders" on page 11)

 

We will use the net proceeds of this offering for general corporate purposes, including working capital and capital expenditures and potentially for establishing its manufacturing facilities, distribution channels, and construction operations. A more detailed description of our anticipated expenses can be found under the “Description of Business” section of this Prospectus. We have not yet determined all of our anticipated expenditures and therefore cannot estimate the exact amounts to be used for all of the purposes discussed above. Accordingly, our management will have broad discretion in applying the net proceeds from this offering.

 

The Company intends to use the proceeds from this offering as follows:

  Minimum Offering Maximum Offering
Application of Proceeds $ % of total

% of net

proceeds

$ % of total

% of net

proceeds

Total Offering Proceeds 450,000 100.00% 100.00% $3,000,000 100.00% 0.25%
Working Capital & Expenses 285,000 63.34% 63.34% 1,651,000 55.03% 55.03%
Manufacturing Facilities 20,000 4.44% 4.44% 562,000 18.74% 18.74%
Establish Distribution Channels 100,000 22.22% 22.22% 250,000 8.33% 8.33%
Plant & Equipment 45,000 10% 10% 537,000 17.90% 17.90%
TOTAL 450,000 100% 100% 3,000,000 100% 100%

DETERMINATION OF OFFERING PRICE

 

We determined the offering price of $0.30 per share arbitrarily by adding a $0.10 premium to the last sale price of our common stock to investors.

 

DILUTION

 

Our net tangible book value as of December 31, 2011 was approximately $144,069 or $0.09 per share of common stock based on 1,517,500 shares of common stock outstanding. Net tangible book value per share represents the amount of our total tangible assets less total liabilities, divided by the number of shares of common stock outstanding as of December 31, 2011. Dilution in net tangible book value per share to new investors represents the difference between the amount per share paid by purchasers of shares of class A common stock in this offering and the net tangible book value per share of common stock immediately after completion of this offering.

10

 

 

After giving effect to the sale of the minimum offering of 1,500,000 shares of class A common stock by us in this offering at the offering price of $0.30 per share, and after deducting estimated offering expenses payable by us of $5,344.00 (consisting of SEC registration fees of $344, legal and professional fess of $4,000 and accounting fees of $1,000), our net tangible book value would be approximately $588,725, or $0.18 per share of common stock. This represents an immediate increase in net tangible book value of $0.11 per share of class A common stock to existing stockholders and an immediate dilution in net tangible book value of $0.10 per share to new investors purchasing shares of class A common stock in this offering based on the minimum offering amount.

 

After giving effect to the sale of the maximum offering of 10,000,000 shares of class A common stock by us in this offering at the offering price of $0.30 per share, and after deducting estimated offering expenses payable by us of $5,344.00, our net tangible book value would be approximately $3,138,725, or $0.27 per share of common stock. This represents an immediate increase in net tangible book value of $0.15 per share of class A common stock to existing stockholders and an immediate dilution in net tangible book value of $0.06 per share to new investors purchasing shares of class A common stock in this offering based on the minimum offering amount. The following table illustrates this per share dilution:

 

Minimum Offering ($450,000)            
Public offering price per share of class A common stock         $ 0.30  
Net tangible book value per common share as of December 31, 2011   $ 0.08          
Increase in net tangible book value per share attributable to existing stockholders   $ 0.10          
Net tangible book value per share as adjusted after this offering           $ 0.18  
Dilution per share to new investors           $ 0.12  

 

Maximum Offering ($3,000,000)            
Public offering price per share of class A common stock         $ 0.30  
Net tangible book value per common share as of December 31, 2011   $ 0.08          
Increase in net tangible book value per share attributable to existing stockholders   $ 0.19          
Net tangible book value per share as adjusted after this offering           $ 0.27  
Dilution per share to new investors           $ 0.03  

 

SELLING SHAREHOLDERS

 

The following section presents information regarding the Selling Shareholders. The Selling Shareholders table and the accompanying notes describe the Selling Shareholders and the number of shares of our common stock being offered. A description of how the Selling Shareholders acquired the shares of common stock being sold in this offering is detailed in the footnotes below.

We are registering 1,742,500 shares of our common stock owned by and on behalf of the Selling Shareholders named in the table below. We will pay all costs, expenses and fees related to the registration of these shares, including all registration and filing fees, printing expenses, legal fees and other associated costs, if any.

We will not be offering any shares on behalf of the Selling Shareholders. These Selling Shareholders are not required to sell their shares, nor have they indicated to us, as of the date of this prospectus, an intention to sell any of their shares being registered. The Selling Shareholders are offering their shares of our common stock for their own account. We will not receive any proceeds from the sale of the Selling Shareholders' shares.

The following table provides as of the date of this prospectus, information regarding the beneficial ownership of our common stock held by the Selling Shareholders, including:

• The number of shares of our common stock owned prior to this offering;

• The total number of shares of our common stock that is being offered through this prospectus;

• The total number of shares that will be beneficially owned upon completion of this offering; and

• The percentage of ownership upon completion of this offering.

 

      SHAREHOLDER (3) Number of Shares Beneficially Owned Prior to the Offering (1) Number of Shares Being Offered Beneficial Ownership of Shares After Offering (1) Percentage of Common Stock Owned After Offering(1)(2)
1     Clifford D. Jett 300,000 300,000 0 0%
2     John Sprovieri 975,000 975,000 0 0%
3     William Beers 300,000 300,000 0 0%
4     Lynn Komar 25,000 25,000 0 0%
5     Kathleen D. Jett* 1,000 1,000 0 0%
6     Mary E Sprovieri* 1,000 1,000 0 0%
7     Linda Beers* 1,000 1,000 0 0%
8     Robert Tanner 2,500 2,500 0 0%
9     Marjorie E. Yarnell 1,000 1,000 0 0%
10     Sharon R. Nolan 1,000 1,000 0 0%
11     Julie Jett Regnell* 3,000 3,000 0 0%
12     Ryan R. Regnell* 1,000 1,000 0 0%
13     Roderick R. Regnell* 1,000 1,000 0 0%
14     Larry Barngrover 1,000 1,000 0 0%
15     Ryan P. Sharp 1,000 1,000 0 0%
16     Daniel J. Hall* 1,000 1,000 0 0%
17     George R. Jett* 1,000 1,000 0 0%
18     Kelly Louise Means 1,000 1,000 0 0%
19     Jaime Scott McLaughlin 1,000 1,000 0 0%
20     Linda Randle 1,000 1,000 0 0%
21     Jimmy Nelson 1,000 1,000 0 0%
22     Michael Nilson 1,000 ,1,000 0 0%
23     Doug Bill 1.000 1.000 0 0%
24     Kimberly A. Grimm 1,000 1,000 0 0%
25     Cory L. Bernard 1,000 1,000 0 0%
26     Kenneth A. Jett* 1,000 1,000 0 0%
27     Rebecca Jones 1,000 1,000 0 0%
28     Karen A. Johnson 1,000 1,000 0 0%
29     Jennifer Bain 1,000 1,000 0 0%
30     Elizabeth A Voiles 1,000 1,000 0 0%
31     Jose M. Guzman 1,000 1,000 0 0%
32     Christopher Longphre 1,000 1,000 0 0%
33     Donald Hilderbrand 1,000 1,000 0 0%
34     Martin J Kelly 1,000 1,000 0 0%
35     John Schmidt 1,000 1,000 0 0%
36     Joe Hobbs 2,500 2,500 0 0%
37     Billy Sullivan 2,500 2,500 0 0%
38     Linda Buchanan 1,000 1,000 0 0%
39     Dan Newbold 2,500 2,500 0 0%
40     Lee Hall* 2,500 2,500 0 0%
41     VAWT Earth Wind and Power** 97,000 97,000 0 0%
        1,742,500 1,742,500 0 0%

 

(1) Based upon beneficial ownership information reported to us as of December 31, 2011

(2) Assuming we sell all of the shares being offered through this prospectus we will then have 11,517,500 shares issued and outstanding


*Kathleen D. Jett is the wife of our director Clifford D. Jett. George R. Jett and Kenneth A. Jett are the brothers of our director Clifford D. Jett.

*Mary E Sprovieri is the wife of our officer and director John Sprovieri.

*Linda Beers is the wife of our director William Beers.

*Julie Jett Regnell is the daughter of, Clifford D. and Kathleen D Jett and is the wife of Ryan R. Regnall and mother of Roderick R. Regnell.

*Daniel J. Hall and Lee Hall are not related.

**Rick Plotnikoff is the sole principal of VAWT Earth Wind and Power and consequently, the person with sole voting and investment control. VAWT Earth Wind and Power is a consulting firm providing going public consulting services to Auscrete Corporation in return for 97,000 shares of Auscrete's common stock.


The table on the following page summarizes shares that were initially issued pursuant to Section 4(2) of the Securities Act of 1933 (the "Securities Act") at various dates corresponding with each purchaser. In connection with this issuance, the purchasers were provided with access to all material aspects of the company, including the business, management, offering details, risk factors and financial statements. Each investor also represented to us that he/she was acquiring the shares as principal for his/her own account with investment intent. Each investor also represented that he/she was sophisticated, having prior investment experience and having adequate and reasonable opportunity and access to any corporate information necessary to make an informed decision. This issuance of securities was not accompanied by general advertisement or general solicitation. The shares were issued with a Rule 144 restrictive legend.

TABLE FOLLOWS ON NEXT PAGE

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      NAME ADDRESS

Type of

Consideration

Value of

Services

Value of Cash Date

No. of

Shares

1     Clifford D. Jett PO Box 846, Rufus, OR 97050 Services $60,000.00   1/12/2010 300,000
2     John Sprovieri PO Box 813, Rufus OR 97050 Services $60,000.00   1/12/2010 300,000
2     John Sprovieri PO Box 813, Rufus OR 97050 Assets $135,000.00   12/01/2011 675,000
3     William Beers PO Box 825, Rufus OR 97050 Services $60,000.00   1/12/2010 300,000
4     Lynn Komar 61560 Sunny Breeze Lane, Bend OR 97702 Services $5,000.00   1/12/2010 25,000
5     Kathleen D. Jett PO Box 846, Rufus, OR 97050 Cash   $200.00 1/21/2010 1,000
6     Mary E Sprovieri PO Box 813 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
7     Linda Beers PO Box 825, Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
8     Robert Tanner PO Box 54, Grass Valley OR 97029 Cash   $500.00 1/12/2010 2,500
9     Marjorie E. Yarnell PO Box 6, Rufus OR 97050 Cash   $200.00 1/12/2010 1,000
10     Sharon R. Nolan PO Box 745, Rufus OR 97050 Cash   $200.00 1/12/2010 1,000
11     Julie Jett Regnell 1126 Olmo Way, Boulder City NV 89005 Cash   $600.00 1/12/2010 3,000
12     Ryan R. Regnell 1126 Olmo Way, Boulder City NV 89005 Cash   $200.00 1/12/2010 1,000
13     Roderick R. Regnell 1126 Olmo Way, Boulder City, NV 89005 Cash   $200.00 1/12/2010 1,000
14     Larry Barngrover 428 S. Lawndale Dr., Spring Creek, NV 89815 Cash   $200.00 1/12/2010 1,000
15     Ryan P. Sharp PO Box 351, Pendleton, OR 97801-0351 Cash   $200.00 1/12/2010 1,000
16     Daniel J. Hall PO Box 292,Wasco, OR 97065 Cash   $200.00 1/12/2010 1,000
17     George R. Jett PO Box 826, Rufus, OR 97050 Cash   $200.00 1/12/2010 1,000
18     Kelly Louise Means PO Box 12053, Reno, NV 89510 Cash   $200.00 1/12/2010 1,000
19     Jaime Scott McLaughlin PO Box 12053, Reno, NV 89510 Cash   $200.00 1/12/2010 1,000
20     Linda Randle 6060 Oak St., Anderson, CA 96007 Cash   $200.00 1/20/2010 1,000
21     Jimmy Nelson 353 Centerville Hwy., Lyle, WA 98635 Cash   $200.00 1/20/2010 1,000
22     Michael Nilson PO Box 518, Lyle, WA 98635 Cash   $200.00 1/20/2010 1,000
23     Doug Bill 101 Jayden Lane Stevenson WA 98648 Cash   $200.00 1/20/2010 1,000
24     Kimberly A. Grimm PO Box 801, Rufus, OR 97050 Cash   $200.00 1/21/2010 1,000
25     Cory L. Bernard 704 Oak Ave., Hood River, OR 97031 Cash   $200.00 1/21/2010 1,000
26     Kenneth A. Jett PO Box 846, Rufus, OR 97050 Cash   $200.00 2/4/2010 1,000
27     Rebecca Jones 72233 Blalock Cyn. Rd. Arlington,OR 97812 Cash   $200.00 2/4/2010 1,000
28     Karen A. Johnson 300 Circulo Uno Poco, Rohnert Park, CA Cash   $200.00 2/4/2010 1,000
29     Jennifer Bain 4804 Gettysburg Rd.,Knoxville, TN 37921 Cash   $200.00 2/4/2010 1,000
30     Elizabeth A Voiles 6200 Hickson Pike, #202, Hickson TN 37343 Cash   $200.00 2/4/2010 1,000
31     Jose M. Guzman PO Box 703, Rufus, OR 97050 Cash   $200.00 2/4/2010 1,000
32     Christopher Longphre PO Box 631, Stevenson, WA 98648 Cash   $200.00 2/4/2010 1,000
33     Donald Hilderbrand PO Box 148, Wasco OR 97065 Cash   $200.00 2/4/2010 1,000
34     Martin J Kelly PO Box 813 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
35     John Schmidt PO Box 1934 Sandy OR 97055 Cash   $200.00 2/4/2010 1,000
36     Joe Hobbs 210 Webber Street, The Dalles OR 97058 Cash   $500.00 2/4/2010 2,500
37     Billy Sullivan PO Box 614, Hood River OR 97031 Cash   $500.00 2/4/2010 2,500
38     Linda Buchanan PO Box 825 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
39     Dan Newbold 30303 Maple Drive, Junction City, OR 97448 Cash   $500.00 2/4/2010 2,500
40     Lee Hall 30325 Maple Dr. Junction City, OR. 97448 Cash   $500.00 2/4/2010 2,500
41     VAWT Earth Wind and Power Unit 2393 Sidney, B.C. V8L 3Y3 Services $19,400.00   1/12/2010 97,000
          TOTALS $339,400.00 $9,100.00   1,742,500

PLAN OF DISTRIBUTION

 

We are offering a minimum of 1,500,000 and a maximum of 10,000,000 shares of common stock maximum on a self-underwritten basis. The offering price is $0.30 per share. This is a self-underwritten “best-efforts” offering. The Shares will be offered at a fixed price of $0.30 per share for a period not to exceed 18 months from the date of this prospectus. If we do not sell the minimum number of shares within 18 months from the date of this prospectus, we will promptly return all funds to subscribers. There are currently no arrangements to place the funds in escrow, trust, or similar account during the period prior to meeting the minimum offering. This prospectus is part of a prospectus that permits our directors to sell the shares of common stock directly to the public with no commission or other remuneration payable to our directors for any shares they may sell. Upon effectiveness of this registration statement, we intend to take steps to have our common stock eligible for quotation on the OTC Bulletin Board by filing a Form 211 through Glendale Securities, Inc. There are currently no plans or arrangements to enter into any contracts or agreements to sell the shares with a broker or dealer. We can provide no assurance that our shares will be quoted on the OTC Bulletin Board or, if quoted, that a public market will materialize. In the absence of listing, no market is available for investors in our common stock to sell their shares. We cannot guarantee that a meaningful trading market will develop or that we will be able to get our common stock listed for trading. If the stock ever becomes tradable, the trading price of our common stock could be subject to wide fluctuations in response to various events or factors, many of which are beyond our control. As a result, investors may be unable to sell their shares at or greater than the price at which they are being offered.

 

Our directors will sell the shares and intend to offer them to friends, family members, and personal and professional acquaintances. In offering the securities on our behalf, our directors will rely on the safe harbor from broker dealer registration set out in Rule 3a4-1 under the Securities Exchange Act of 1934. In their endeavors to sell this offering, our directors will not use any mass-advertising methods such as the Internet or print media.

 

Our directors will not register as a broker-dealer pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (“Exchange Act”), in reliance upon Rule 3a4-1, which sets forth the conditions under which a person associated with an issuer, may participate in the offering of the issuer's securities and not be deemed to be a broker-dealer. The conditions are that:

 

1) The person is not statutorily disqualified, as that term is defined in Section 3(a)(39) of the Exchange Act, at the time of his or her participation;

 

2) The person is not compensated in connection with his or her participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities;

 

3) The person is not at the time of their participation, an associated person of a broker-dealer; and

 

4) The person meets the conditions of Paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that he or she (a) primarily performs, or is intended primarily to perform at the end of the offering, substantial duties for or on behalf of the issuer otherwise than in connection with transactions in securities; and (b) is not a broker or dealer, or an associated person of a broker or dealer, within the preceding 12 months; and (c) does not participate in selling and offering of securities for any issuer more than once every 12 months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).

 

Our directors are not statutorily disqualified, are not being compensated, and are not associated with a broker-dealer. They are and will continue to be our directors at the end of this offering and are not currently and have not been during the last 12 months broker-dealers or associated with a broker-dealer. They have not during the last 12 months and will not in the next 12 months offer or sell securities for another corporation.

 

12

 

 

Our sole officer and the directors of the Company will not receive commissions for any sales originated on our behalf. We believe that our sole officer and the directors are exempt from registration as brokers under the provisions of Rule 3a4-1 promulgated under the Securities Exchange Act of 1934. In particular, as to our officer and directors, they:

 

1. Are not subject to a statutory disqualification, as that term is defined in Section 3(a)39 of the Act, at the time of his or her participation; and

 

2. Are not to be compensated in connection with their participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in securities; and

 

3. Are not an associated person of a broker or dealer; and

 

Meets the conditions of the following:

 

a. Primarily performs, or is intended primarily to perform at the end of the offering, substantial duties for or on behalf of the issuer otherwise than in connection with transactions in securities; and

 

b. Was not a broker or dealer, or associated persons of a broker or dealer, within the preceding 12 months; and

 

c. Did not participate in selling an offering of securities for any issuer more than once every 12 months other than in reliance on paragraphs within this section, except that for securities issued pursuant to rule 415 under the Securities Act of 1933, the 12 months shall begin with the last sale of any security included within one rule 415 registration.

 

Our sole officer and the directors of the Company may purchase any securities in this offering.

As purchasers of shares a shell company, the Selling Shareholders are considered underwriters for purposes of this Offering and shall be deemed to be engaged in a distribution of our common stock in connection with the resale of their shares and therefore must comply with applicable securities laws

There can be no assurance that all, or any, of the shares will be sold. In order to comply with the applicable securities laws of certain states, the securities may not be offered or sold unless they have been registered or qualified for sale in such states or an exemption from such registration or qualification requirement is available and with which we have complied. The purchasers in this offering and in any subsequent trading market must be residents of such states where the shares have been registered or qualified for sale or an exemption from such registration or qualification requirement is available. As of this date, we have not identified the specific states where the offering will be sold. We will file a post-effective amendment indicating which state(s) the securities are to be sold pursuant to this registration statement.

 

Investors can purchase common stock in this offering by contacting the Company. All payments must be made in United States currency either by personal check, bank draft, or cashiers check. There is no minimum subscription requirement. All subscription agreements and checks are irrevocable. The Company expressly reserves the right to either accept or reject any subscription. Any subscription rejected will be returned to the subscriber within 5 business days of the rejection date. Furthermore, once a subscription agreement is accepted, it will be executed without reconfirmation to or from the subscriber. Once we accept a subscription, the subscriber cannot withdraw it.

 

SHARES OFFERED BY THE SELLING SHAREHOLDERS

 

The Selling Shareholders may sell some of all their shares of our common stock in one or more transaction, including block transactions. There are no arrangements, agreements, or understandings with respect to the sale of these securities. The Selling Shareholders will sell our shares of common stock at a fixed price of $0.30 per share until our shares of common stock are quoted on the OTC Bulletin Board, and thereafter may be offered at prevailing market prices or privately negotiated prices. Notwithstanding the previous sentence, our officers and directors will sell their shares of common stock at a fixed price of $0.30 per share through the term of this Offering regardless of the prevailing market prices

 

The Selling Shareholders may distribute their shares of our common stock to one or more of its officers, directors, or shareholders who are unaffiliated with us. Such new shareholders may, in turn, distribute such shares of our common stock as described above. If these shares being registered for resale are transferred from the named Selling Shareholders and the new shareholders wish to rely on the prospectus to resell these shares, then we must file a prospectus supplement naming them as Selling Shareholders and provide the information required concerning the identity of each new Selling Shareholder and their relationship, if any, with us. As of the date of this prospectus there is no agreement or understanding between the Selling Shareholders and its offices, directors, or shareholders with respect to the distribution of the shares of our common stock being registered for resale pursuant to this registration statement.

 

We can provide no assurance that any or all of the shares of our common stock offered by the Selling Shareholders will be sold.

 

We will pay all costs, expenses, and fees related to the registration of our shares of common stock owned by the Selling Shareholders. The Selling Shareholders, however, will pay any commissions or other fees payable to broker-dealers in connection with any sale of its shares of our common stock.

 

As purchasers of shares of a shell company, the Selling Shareholders are considered underwriters for purposes of this Offering and shall be deemed to be engaged in a distribution of our common stock in connection with the resale of their shares and therefore must comply with applicable securities laws, among other things;

 

• Not engage in any market stabilization activities in connection with our common stock, should a market ever develop;

• Furnish each broker-dealer through which our common stock may be offered copies of this prospectus, along with any supplements or amendments, as may be required by such broker-dealer; and

• Not bid for or purchase any of our shares of common stock or attempt to induce any person to purchase any of our shares of common stock other than as permitted under the Exchange Act.

 

We have advised the Selling Shareholders that if a particular offer of our shares of common stock to be made on terms constituting a material change from the information described in this "Plan of Distribution" section of the prospectus, then, to the extent required, a prospectus supplement must be distributed setting forth such terms and related information as required.

 

In addition, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the Selling Shareholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act, if applicable

 

DESCRIPTION OF SECURITIES

 

General

 

Our authorized capital stock consists of 500,000,000 shares of common stock at no par value per share.

 

Common Stock

 

As of December 31, 2011, there were 1,742,500 shares of our common stock issued and outstanding held by 41 stockholders of record.

 

Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our articles of incorporation.

13

 

 

Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.

 

Preferred Stock

 

We do not have an authorized class of preferred stock.

 

Dividend Policy

 

We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.

 

Share Purchase Warrants

 

We have not issued and do not have any outstanding warrants to purchase shares of our common stock.

 

Options

 

We have not issued and do not have any outstanding options to purchase shares of our common stock.

 

Convertible Securities

 

We have not issued and do not have any outstanding securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.

 

INTERESTS OF NAMED EXPERTS AND COUNSEL

 

No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, an interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.

 

Luc Nguyen, Attorney at Law, with an address of 1192 Draper Pkwy., #244, Draper, UT 84020, has provided an opinion on the validity of our common stock.

 

The financial statements included in this prospectus and the registration statement have been audited by Lenning & Company, Inc. to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

 

DESCRIPTION OF BUSINESS

 

Company Overview

 

Auscrete was incorporated in the State of Wyoming on December 31, 2009 and is a development stage company that has not commenced operations.

14

 

 

Initially, Auscrete plans to manufacture lightweight cellular concrete wall, roof and interior panels for use in the construction of affordable residential housing using technology previously developed by the founder. The principal business will be to supply builders and contractors with pre-cast wall, roof and interior panels for use in the construction of single-family homes.

Although Auscrete has not begun operations, our CEO and our sole founder has contributed certain assets and equipment owned by another company owned and run by Mr. Sprovieri. The name of that company is also Auscrete Corporation organized under the laws of the State of Oregon (“Auscrete of Oregon”). Mr. Sprovieri contributed these assets in return for 675,000 shares of common stock. The number of shares of common stock issued to Mr. Sprovieri in exchange for the assets were determined arbitrarily. These assets are functional and will be the foundation upon which Auscrete will build its broader manufacturing capabilities.

 

Auscrete’s products will be fabricated on a build to order basis and as such, variable costs will be incurred before the company receives any revenue. These variable costs differ based on the product constructed. Further detail on first year and second year expansion expenditures is listed on page 20. Although the second year expenditures will not be required at the commencement of operations, the purpose of the year two expenditures will be to enhance the manufacturing facilities and process in order to improve efficiency and reduce production costs.

 

At this juncture, Auscrete is a development stage company and has not earned any revenue. The plan of operation is forward-looking and there is no assurance that operations will ever begin.

 

Operations will begin following the raising of the required funds to do so through this offering. It is estimated that $450,000 (Four Hundred Fifty Thousand Dollars) (“Initial Capital Outlay”) will be required at a minimum to begin and continue operations for our first year.

 

Founder’s Development Activities to Date

 

Auscrete’s CEO and founder, John Sprovieri, possesses certain proprietary technology in cellular lightweight concrete manufacturing. He has applied his engineering and marketing expertise to develop and promote products under the product name, Auscrete Cellular Concrete (“ACC”). ACC is the culmination of the refinements made to a technology developed in Australia in the mid 1980’s. The Australian product “Cellucon” (the company manufacturing it is now defunct) has been used in many parts of the world, and Mr. Sprovieri has introduced it to the US. The process enables infusion of millions of tiny air bubbles into a special inert concrete mix enabling the creation of a lightweight product without sacrificing strength or structural integrity.

 

Since commencing re-development of the basic technology nine years ago, Mr. Sprovieri has refined and modified the basic ACC formula utilizing various bubble producing machines to produce the product currently usable in building construction.

At Auscrete of Oregon, a number of specialized machines have been fabricated for the manufacturing of ACC including machinery that can produce various sized bubbles, hydraulically operated casting beds, concrete batching plant, materials handling equipment, specialized finishing machines and a “Hot Box” materials thermal testing cabinet that gives thermal “R” ratings of materials to ASTM specifications. Additionally, many sample panels have been produced for testing and for the construction of structures.

15

 

 

Putting the ACC technology to practical use, Mr. Sprovieri first produced a multi user rest room facility for the city park in Wasco, Oregon three years ago. The construction of the restroom facility provided valuable feedback which helped Mr. Sprovieri refine the manufacturing and construction process. The follow-up project to the restroom facility involved the construction of a 2,500 sq. ft. prototype house (pictured to the right) on land in Rufus, Oregon.

 

The following assets were contributed by Mr. Sprovieri and are functional at our manufacturing facility.

 

Contributed Assets

 

Description
   
Concrete Batch Plant
9,000 sq. ft. Building. Complete New (not erected) Industrial Clear Span Building
15,000# Capacity Nissan Forklift
6,000# Capacity Toyota Forklift
Yanmar Tractor/Front End Loader
Volvo Semi-Road Tractor
20’ Flat Deck Trailer
Ford F250 Diesel Pickup

 

Manufactured Specialized Equipment

 

   
The Corporation will lease the following Manufacturing Equipment:
   
2 Hydraulically Operated Molding Tables
4 Regular 20’ Molding Tables
1 Mobile Concrete Transporter
Thermal Testing Machine Known as a “Hot Box“
2 Crane Attachments
Concrete Panel Storage Racks
Sand Bunker
Mold Boards, Manual & Magnetic Clamps, Brackets

 

 

The current pilot plant facility is a decommissioned service station rented from the city. The outer driveway and back areas serve as the foundation for the two major casting beds and four smaller panel casting beds. Space is restricted. The concrete batching plant, with its 35-ton capacity cement silo is against the end wall of the driveway and the hopper is behind the sand storage pit. The office is the service station office and the mechanical workshop serves as the fabrication area for the manufacture of rebar cage frames. Any other work is done out in the open areas. Storage of completed panels, some as large a 16’ x 8’, is in industrial racks that have been built at the other end of the driveway area. To complete a 1,500 sq. ft. house, storage for as many as 30 wall panels and 25 roof panels would be needed. The plant is able to produce up to 6 wall panels per week from the large casting beds, based on the capacity of the current equipment.

 

 

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Our Product

The corporation’s projected initial products will include homes and small commercial structures built of cellular concrete. Auscrete’s potential ability to create a light weight product that remains strong will enable production of affordable wall, roof and interior panels for the construction of these structures

 

The basic materials for the Auscrete product will be cement, sand, water and a proprietary inert chemical that will support the creation and longevity of very small bubbles. Cement is a standard Portland cement readily available from many suppliers. Sand and water are also available adjacent to the plant. The chemical has previously been imported from Australia but will be manufactured by a chemical company in the US upon the commencement of operations. A chemical manufacturer has yet to be identified to manufacture the chemical and as such, there are no current agreements in place for such production.

 

The Auscrete product will be considered “green” in today’s evolving need for energy efficiency. Cellular concrete is perceived to be “green”, in part because of the minimal impact on the environment and its energy efficiency. The aim is to have a structure that uses minimum possible power consumption for environmental control. Auscrete’s cellular structures are projected to provide very high efficiency in insulation values and, as such, have very low power input.

 

Additionally, cement is an abundant material and, although it does use resources, its use is considered “green” when compared to products that use wood or oil based plasticized products. Sand is available readily and aged concrete can be ground and reused as aggregate. Non potable water can be used in concrete construction.

 

Energy tests on the ACC product have been carried out by an independent engineering firm and were done to the ASTM C1363-05 standard. Various weights per cubic foot are used for panels in differing areas. In general, external walls have an R rating of R22.3 and roof panels have an R rating of R32.7. This gives a whole house rating well in excess of the “whole house” Code requirement of R15.

 

Auscrete’s products will enable the construction of homes that are extremely thermally efficient in all conditions, strong in earthquake zones, will not burn, have excellent sound proofing and be impervious to pests, rot and mold. This technology is ideal for the construction of homes in the 1,000 – 3,000 sq. ft. range.

 

To provide homes at low cost, it will be necessary to produce the materials on a “mass production” basis. That is why the company’s plan will incorporate the methodologies of large manufacturing companies in order to provide products for the construction of, initially 30, then 150 affordable ($70k –$150k) high quality site built homes a year using Auscrete’s casting technique.

 

Technology

 

The foaming process used to produce the aerated concrete that will be the basis of our products has its origins in a technology developed in the early 1980’s in Australia. At that time, Romarada Chemicals of Victoria, Australia first produced a chemical mixture called Cellucon that had the ability to maintain its structural and tensile integrity during infusion of minute air bubbles, thus creating a much lighter concrete product, even when under mixing and blending stresses. Mr. Sprovieri’s association with Cellucon goes back to 1992 and he was involved in assisting the development of not only the Cellucon product, but also the marketing of the product internationally. The Cellucon chemical company closed operations in 2003 due to the death of the founder and owner. Mr. Sprovieri brought with him to the United States, his knowledge of the Cellucon production process, which he has since refined and enhanced in the production of a similar aerated concrete product through his company, Auscrete of Oregon.

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As mentioned above, the Cellucon process has been further refined here in the US over the last 9 years by Auscrete’s founder. In particular, through experimentation the founder has been able to determine the optimal balance between the size of the bubbles and the strength of the concrete. Auscrete’s founder has developed specialty bubble producing machinery that can very effectively control the bubble size as required for particular applications. As discussed above, the founder has previously used this process to successfully construct a large prototype house and rest room facility.

 

Auscrete’s founder’s proprietary method for producing the aerated concrete involves the mixing of cement, sand and water and the specially developed air charged foaming agent that is infused during manufacturing. This enables the product to contain millions of strong, tiny air bubble ‘aggregates’ evenly distributed throughout the lightweight cast panel sections. With the addition of air, there is room for expansion and contraction, allowing for a concrete product that is both durable and flexible.

 

With previous construction of prototype structures, our concrete casting experience has determined that a big advantage of Auscrete’s technology is its ability to be produced as large panels at very low cost in a casting factory atmosphere with controlled simple casting techniques that ensures absolute quality control.

 

Housing Construction

 

Concrete is generally accepted as a standard basic building material. There appears to be little resistance to the use of concrete in home construction, particularly in the initial targeted sales areas of the Western United States.

 

Notwithstanding the economical and ecological advantages of our product, there are also few limits to the type or style of home that can be built with our product. Architectural style has no limitations with this system. The intricacies of any design are created easily by the casting mold shape and the structural materials used, which are for the most part, treated steel and concrete.

 

In addition our product will have the advantage of allowing for premium features not found in other building materials. Such features include soaring cathedral ceilings without unsightly trusses, tubular solar skylights to reduce energy consumption, energy efficiency with whole house ratings in excess of R15 as mentioned under the “Technology” section above, sound reduction as befits such insulation value, utility rooms, lots of storage areas and single or double car garages.

 

The panels for the construction of a home will be cast in our factory under tight quality control. There are large (typically 25’ x 10’) hydraulically tilting steel casting tables that can handle the largest panels of any house. Each panel mold is made up of vinyl moldboards that can be snapped together in the shape and size as required.

 

Each wall panel incorporates a cast-in, skeletal reinforcing frame containing vertical steel tubes, through which the hold down bolts pass to secure the panel to the concrete slab base. At the same time, electric conduit and boxes are set in place and any vent tubes that are required.

 

The specialized concrete is then applied to the mold and finished to a smooth, flat appearance. As the inside walls of the house are the inner side of the panel, surface finish is very important because the interior paint or other surfacing will be applied directly to that panel.

 

The roof is made of energy efficient, individual panels of typically 18’ x 4’ sections. The undersides of these panels become the ceiling in the cathedral roof design. Because of their light weight, many panels can be loaded onto a step deck semi-trailer and delivered to the site, either close by or many miles away.

 

The panels are then assembled on the prepared concrete slab by being craned into place. Long, high tensile bolts are fitted right down from the top of the wall panel and pass through the fabricated reinforcing frame pulling together a stable and strong assembly. A 2-millimeter (.080”) thick adhesive/sealant barrier is applied between all concrete joints before being finally positioned and tightened down.

 

After setting of the wall panels, electrical wiring is fed through the conduit and the roof panels are then hoisted into place. These panels are held down with heavy duty, high tensile bolts threaded into the cast in receivers on the top of the side and cross walls.

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The wall and roof panels are usually set in place over 5 days and the finishing of the house is commenced. As a lot of the fitting is already cast into the panels at the factory, it takes just a few weeks to finish plumbing, electrical and fitting of windows and doors, cabinets and roof shingles or metal roof finish as required by the contract.

 

The final stucco finish, once again simply applied direct to the concrete, is applied in 2 days and the house is ready for occupation.

 

Other Potential Uses

 

Although the Company will initially be focused on manufacturing panels for the construction of single family and multi unit housing, our product line may be expanded in the future for other uses.

 

  Construction of commercial and industrial office and factory structures.
  Construction of soundproof structures such as sound stages and studios.

 

  Construction of molded structures such as arches and building fascias.
  Construction of thermal structures such as public restrooms and cold stores.

 

  Construction of walls and fences such as freeway sound barriers and general fencing.
  Construction of lawn and garden furniture and attractions.

 

  Construction of housing and structures using pre-made blocks and sections.

 

Market

 

Auscrete Corporation intends to position itself as a major supplier in the affordable housing market. Housing is generally considered “affordable” when its cost does not exceed 30 percent of the median family income in a given area. In many parts of the country, housing costs have begun to show signs of adversely affecting corporations, workers and local economies. Affordable housing is becoming increasingly scarce.

 

Our Strategy

 

We are to promote a product that will not only make housing affordable but offer some luxuries as well, such as optional heat pump air conditioning that would not be available in other houses at such comparable pricing. We believe that by constructing with the Auscrete aerated concrete, those luxuries will result in lower cost utilities and a comfortable ‘feel’ to the living environment, as can be achieved with a product offering excellent thermal and soundproofing qualities as well as superb fire resistance.

 

Our developers and contractors will offer the homes as complete ready constructed site built units on suitable land. They will not be offered under the banner of such categories as ‘pre-fabricated’ or ‘factory built’ homes. They are just plain good value masonry homes built of a time proven product, concrete.

 

Initially, we intend to establish our operations and a manufacturing facility in the Industrial Estate area of Rufus, Oregon. Rufus is a small city about 110 miles east of Portland. Construction of the plant should take 10-12 months. The advantage of Rufus is it is located on 2 main highways, I-84 east/west and I-97 north/south.

 

The location will help considerably with the delivery of our pre-cast panels initially to the Northwest area and will also simplify the delivery of raw materials to our facility. We anticipate that in the initial year we will be able to produce enough panel sets for the construction of 30 homes.

 

We believe that we will be able to economically deliver whole house panel sets as far away as Arizona or Alberta, Canada. However, with a future facility to be set up in Central California, we believe that we will be able to achieve further efficiencies to be able to service a fast emerging market in this above average (for affordable housing) growth area. Additionally, a plant in Central California could easily initially address the Arizona market once the market recovery in that area has taken effect.

 

We plan on selling most of our output to developers, contractors and builders who will purchase the complete set of wall, roof and interior panels from us and use their own construction crew to complete the house.

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PROPOSED Capital Expenditures

If the corporation should raise the maximum offering of $3 Million Dollars, the Company will require the following capital expenditures in order to expand to meet the projected manufacturing requirements in a timely manner.


Year 1 Capital Asset Purchases at 100% of Offering ($3.0 million)      
Purchase land, purchase one additional factory building and office building. Move in.     330,000  
Land Preparation and erection of buildings     232,000  
Machinery, silos, batchers, mixers, conveyers, trailers, crane & forklift.     362,000  
Specialized equipment, casting beds etc. manufactured ‘in house’     76,000  
Shop equipment, press, lathe, welders etc.     89,000  
Office equipment, drafting software, computers etc.     10,000  
Total Asset Expenditures Year 1   $ 1,099,000  

First year working capital and expenses including wages and salaries, marketing,

other working capital and reserves

  $ 1,901,000  
Total Capital Expenditure and working capital for year 1   $ 3,000,000  

 

Year 2 Capital Asset purchases below are necessary if additional expansion is required.      
         
Year 2 Capital Asset Purchases        
Purchase 2 factory buildings, Erection and Commissioning     480,000  
Land Preparation and erection of buildings     400,000  
Machinery, silos, batchers, mixers, conveyers, trailers & forklifts.     278,000  
Specialized equipment, casting beds etc. manufactured ‘in house’     176,000  
Shop equipment, shears, rollers etc.     12,000  
Office equipment, drafting software, computers etc.     20,000  
Total Asset Expenditures Year 2   $ $ 1,366,000  

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Marketing

 

Our principal marketing efforts will be focused on interpersonal contacts and relationships. We intend to first leverage our contacts and relationships in and around Rufus, Oregon along with our local knowledge of the area to market our product and distinguish ourselves. Our initial marketing thrust will include meetings with developers and construction companies to supply our product for their own construction needs. Although we intend to eventually build homes through our own construction division, we initially anticipate that over 90% of our sales will be to contractors and developers once our manufacturing gets off the ground.

 

Revenue

 

Revenue for the company will come from the purchase of our concrete panels and panel sets. Specific prices may change due to elasticity of demand and fluctuations in commodity prices but currently we anticipate revenues derived of the typical homes listed below as follows:


1,000 Sq. Ft. Home:   $ 70,000  
1,500 Sq. Ft. Home:   $ 95,000  
2,000 Sq. Ft. Home:   $ 120,000  
2,500 Sq. Ft. Home:   $ 150,000  

At present the Company does not have any current customers or customer contracts.

 

Competition

 

The building supplier industry is a highly competitive industry. We compete with a large number of competitors in the construction supply business. In addition to other companies that manufacture and distribute pre-cast aerated concrete wall, roof and interior panels, we will compete with companies that supply panels made of alternative materials including but not limited to, drywall, gypsum and wood. In addition, we will compete with local, regional and national home improvement retailers such as Home Depot and Lowe’s who offer other building materials to the public and to contractors.

 

Areas of Competition. Competition in the housing industry relate to contractors, builders and developers all striving to achieve the common goal of generating business in the home construction industry. The following are the principal areas that will compete with Auscrete products:

 

a. Tradition Concrete Construction. Traditional concrete is generally used in warmer states (e.g., Florida to California). Costs fall around the $130 per sq. ft range and have little insulation value.

b. ICF construction. ICF (“Insulating Concrete Forms”) are external molds built of polystyrene with traditional concrete poured in between. ICF has insulation values comparable to Auscrete’s products. However, it is a labor intensive industry and normally costs in excess of $150 per sq. ft.

c. Raastra Block Construction. Raastra block has good insulation values but involves block-laying at the site and filling with mortar. This process is also labor intensive and usually costs in excess of $ 160 per sq. ft.

d. AAC (“Aerated Autoclaved Concrete”). AAC is a process where aluminum oxides are added to the concrete mix and create oxygen bubbles by chemical reaction to lighten the weight of the mixture. This process involves the block-laying and mortar filling elements. Also, these blocks are easily broken and there is a high level of loss. This process can cost up to $190 per sq. ft.

e. Stick Built Construction (Wood frame). The most common construction method of residential construction, this process can cost between $85 and $180 per square foot. The strength of wood framing is less than that of concrete.

f. Alternative Construction Methods. Other construction methods include log houses, straw bale and various other alternative methods. These methods represent a very small percentage of the total construction market.

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Methods of CompetitionTo distinguish themselves in the construction supply business, suppliers employ a variety of methods to separate themselves from the competition. One of the principal methods of competition is price. National companies and large regional suppliers leverage their buying power to offer building supplies at reduced prices. Local suppliers may attempt to match prices at the cost of reduced margins, but may look to other areas in which to compete. Suppliers may also tout their quality of materials, design, construction, deployment and customer service to distinguish themselves from the competition.

 

We expect to face increased competition in the future. Further, many of our potential competitors have longer operating histories, greater name recognition, access to larger customer bases and significantly greater financial, sales and marketing, manufacturing, distribution, technical and other resources than us. However, we believe that our unique position of being able to provide environmentally friendly “green” construction materials that are affordable and that incorporate a process that is distinguished from other building materials suppliers will allow us to compete effectively, especially in the Northwest where we have established relationships.

 

Insurance

 

We do not currently maintain insurance but intend to maintain general liability and other insurance to the standard in the industry.

 

Employees

 

We are a development stage company and currently have no salaried or waged employees. Our sole officer and the directors currently serve the Company for no compensation.

 

Government Regulations

 

Our products have already been approved to State and County building codes. The Auscrete of Oregon ACC concrete product which we will be assimilating has been submitted and approved by the State of Oregon as a pre fabricated building component and carries a registration with the Building Codes Division, license # PFC571. This registration is also accepted by the State of Washington as evidence of competency.

 

Proposed future government regulations perhaps may include requirements for increased energy efficiency and material and construction standards for tornado and flood areas.

 

At present, no environmental laws either at the federal, state or local levels applies to the Auscrete manufacturing process. If this changes in the future, and an environmental law becomes applicable, this could result in extra costs and delays that could have a negative effect on our business.

 

Research and Development

 

The aerated concrete that will be the basis of Auscrete’s construction products is the product of the combination of a foaming agent and foaming machine. Research and development undertaken by Mr. Sprovieri since 2003 worked on creating a better aerated concrete by focusing on improving the following three areas: (a) the production of a machine to produce optimum sized bubbles, (b) identification of a surfactant (bubble producing liquid) that endures better while being aggressively mixed in concrete mixers and (c) the development of concrete mix recipes that give the best performance. The Auscrete aerated concrete has its roots in another aerated concrete developed by Cellucon starting in the mid 1980’s in Australia. Recognizing shortfalls in the Cellucon product including (a) the machine making the concrete produced erratic result and occasionally the concrete lacked strength and (b) the surfactant contained a biological animal protein that was odorous and unreliable.

 

Mr. Sprovieri’s research and development efforts have been focused on creating a more reliable machine and eliminating the animal protein component of the surfactant. Through his efforts, Mr. Sprovieri has been able to develop a synthetic component for the surfactant to replace the animal protein component while attaining the desired bubble wall strength while minimizing the size of the bubbles. Mr. Sprovieri has also worked to develop a bubble-producing machine that could produce bubbles of a consistent size with variable bubble size options. In connection with developing an optimum bubble-producing machine, Mr. Sprovieri conducted energy testing on samples of the concrete in a custom “hot box” built to the ASTM C1363-05 standard. He also conducted strength tests in cooperation with an ASTM certified laboratory in Oregon. Through his efforts, Mr. Sprovieri has been able to develop the optimum surfactant, bubble-producing machine and optimum concrete mix combinations for the creation of an optimum aerated concrete.

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Subsidiaries

 

We do not have any subsidiaries.

 

Intellectual Property

 

Through the Founder and CEO, the company already has the following:

 

Technology:

A chemical design for the production of a surfactant that, when used in a foaming machine, can produce robust, micro-bubbles.

The design of a foaming machine that, when using the above surfactant, can produce minute bubbles within the range necessary for ACC production.

Know-how:

The information gained from past production research and development of products that enables the correct mixing of the concrete base and micro bubbles to ensure precision blends of raw product.

Branding:

Ownership of the Auscrete name for use as trade marks, branding on product and literature and printing.

 

Offices

 

Our office is currently located at 504 East First St. Rufus OR 97050 and our telephone number is (541) 739-8200. This location does not have the manufacturing capacity required by our anticipated operations. We intend to establish our headquarters and manufacturing facilities in the Rufus Industrial Estate if we are able to raise the minimum capital requirement under this offering. We do not pay any rent and there is no agreement to pay any rent in the future. Such costs are immaterial to the financial statements and, accordingly have not been reflected therein.

 

LEGAL PROCEEDINGS

 

We are not currently a party to any legal proceedings. Our address for service of process in Wyoming is 109 W. 17th St. Cheyenne, WY 82001.

 

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

 

Admission to Quotation on the OTC Bulletin Board

 

We intend to have our common stock be quoted on the OTC Bulletin Board. If our securities are not quoted on the OTC Bulletin Board, a security holder may find it more difficult to dispose of, or to obtain accurate quotations as to the market value of our securities. To qualify for quotation on the OTC Bulletin Board, an equity security must have one registered broker-dealer, known as the Market Maker, willing to list bid or sale quotations and to sponsor the company listing. Although, we have verbally agreed to engage Glendale Securities, Inc. to apply with the Financial Industry Regulatory Authority to have our common stock eligible for quotation on the OTC Bulletin Board by filing a Form 211, we may not now and may never qualify for quotation on the OTC Bulletin Board.


Stockholders of our Common Stock

 

As of the date of this registration statement, we have 41 registered shareholders. The 20 largest shareholders are as follows:

 

    NAME ADDRESS SHARES
1   Clifford D. Jett PO Box 846, Rufus, OR 97050 300,000
2   John Sprovieri PO Box 813, Rufus, OR 97050 975,000
3   William Beers PO Box 825, Rufus, OR 97050 300,000
4   VAWT Earth Wind and Power Unit 2393 Sidney, B.C. V8L 3Y3 97,000
5   Lynn Komar 61560 Sunny Breeze Lane, Bend, OR 97702 25,000
6   Julie Jett Regnell 1126 Olmo Way, Boulder City, NV 89005 3,000
7   Robert Tanner PO Box 54, Grass Valley, OR 97029 2,500
8   Joe Hobbs 210 Webber Street, The Dalles, OR 970587 2,500
9   Billy Sullivan PO Box 614, Hood River OR 97031 2,500
10   Dan Newbold 30303 Maple Drive, Junction City, OR 97448 2,500
11   Lee Hall 30325 Maple Dr. Junction City, OR. 97448 2,500
12   Kathleen D. Jett PO Box 846, Rufus, OR 97050 1,000
13   Mary E Sprovieri PO Box 813, Rufus, OR 97050 1,000
14   Linda Beers PO Box 825, Rufus, OR 97050 1,000
15   Marjorie E. Yarnell PO Box 6, Rufus OR 97050 1,000
16   Sharon R. Nolan PO Box 745, Rufus, OR 97050 1,000
17   Ryan R. Regnell 1126 Olmo Way, Boulder City, NV 89005 1,000
18   Roderick R. Regnell 1126 Olmo Way, Boulder City, NV 89005 1,000
19   Larry Barngrover 428 S. Lawndale Dr., Spring Creek, NV 89815 1,000
20   Ryan P. Sharp PO Box 351, Pendleton, OR 97801-0351 1,000

 

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Rule 144 Shares

 

All of the presently outstanding shares of our common stock are "restricted securities" as defined under Rule 144 promulgated under the Securities Act and may only be sold pursuant to an effective registration statement or an exemption from registration, if available. All our issued and outstanding shares have been held since at least February 4, 2010, and are subject to the restrictions and sale limitations imposed by Rule 144. Under Rule 144, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one (1) year after the Company is no longer deemed a "shell company" as defined in Rule 12b-2 of the Exchange Act, as amended.

 

Stock Option Grants

 

To date, we have not granted any stock options.

 

Registration Rights

 

We have not granted registration rights to the selling shareholders or to any other persons.

 

Dividends

 

There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends.

 

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PLAN OF OPERATIONS

 

Our plan of operations will depend wholly on our ability to raise the Minimum Offering of $450,000 pursuant to this registration. The first order of business will be to complete the effectiveness of our registration and the registration of our shares for sale. Our next milestone will be to raise the Maximum Offering of $3,000,000. Upon achievement of raising the Maximum Offering, our plan of operations for the succeeding twelve months thereafter are as discussed below beginning with the “Establish Office and Manufacturing Facility” subsection:

 

Registration and Offer of Securities

 

Our first milestone is to complete the registration of our shares for sale immediately, effect registration of our common stock under the Securities Act concurrently with the effectiveness of the registration statement of which this prospectus forms a part, and then obtain a symbol to facilitate quotation of our shares on the OTC Bulletin Board. We have verbally agreed to engage Glendale Securities, Inc., 15233 Ventura Blvd., Suite 712, Sherman Oaks, CA. 91403, a registered broker-dealer and market maker, to apply with the Financial Industry Regulatory Authority to have our common stock eligible for quotation on the OTC Bulletin Board. With the assistance of the Market Maker, we anticipate obtaining quotation of our common stock on the OTC Bulletin Board upon the effectiveness of the registration statement of which this prospectus forms a part. The Market Maker will not be compensated by the Company. The nature of the costs we will incur in connection with this offering include audit, legal, and SEC registration costs. These costs, initially estimated at $5,344.00, will be incurred entirely by VAWT Earth Wind and Power Corp., a Canadian corporation registered in the province of British Columbia (“VAWT”). VAWT is a consulting firm providing going public consulting services to Auscrete in return for 97,000 shares of the Company’s common stock. There is no written agreement with VAWT for its consulting services. However, a description of the oral agreement between Auscrete and VAWT is attached hereto as Exhibit 10.9.

 

Establish Office and Manufacturing Facility

 

At the outset, we intend to use already existing manufacturing Plant and Equipment capabilities upon achieving the Minimum Offering of $450,000. We believe the Maximum Offering of $ 3,000,000 would be required to expand our manufacturing capacity. Of the $3 million it will cost approximately $1,099,000 to set up our new manufacturing facility on the Industrial Estate. Another $1,001,000 would be required to cover the $475,000 necessary for salary and wages to hire executive, administrative, marketing and labor personnel necessary to expand our operations as well as other working capital. Initial capital expenses for the first 12 months following the raising of $3 Million is discussed in “Description of Business” section above.

 

 

Beginning Operations

 

Our Corporation has acquired the existing manufacturing plant and equipment from Auscrete of Oregon. Additionally, it will take over the lease of an existing pilot plant facility leased from the City of Rufus, and will employ the previously trained staff of Auscrete of Oregon to ensure a smooth transition and continuation of production and revenues.

 

Proposed Expansion of Manufacturing Facility

Auscrete Corporation has available a little over 10 acres of Industrial Land on the City of Rufus Industrial Park with utilities already in place.

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The new complex will start out with a rebar fabrication building that will also be a maintenance area and inventory storage facility. There is also a production building that has a concrete mixer at one end close to the cement silo and other necessary supply points. This building will house 24 casting tables. The other end of the building has the finishing area where panels get applied coatings and final inspection before being taken to storage and shipping.

 

Operations Management

 

Operations will begin at the existing plant immediately upon funding availability. When the new Fabrication Building and Production Building has been completed at the industrial site, production will be moved there.

 

The Auscrete Team will comprise of a minimal tiered management structure that enables control and knowledge to be firmly at the hands of senior management ensuring rapid and simplified direct reporting.

 

Upon commencement of Auscrete’s activity, under control of the President will be marketing, manufacturing operations, design architecture and engineering, administration and safety officer. Additionally, there is a construction manager that will oversee Auscrete’s own construction activities as well as liaise with contractors and developers.


Management and Operations Structure


 


Production Facilities

 

The Auscrete product is mostly the production of specialty cast concrete panels used to build houses and other structures. The main activity on a daily basis is the preparation of molds on the molding tables and the application of rebar and other inclusions before pouring the mixture. The Auscrete ACC mixture is blended at the mixing station and poured into the molds where they cure for 2 days. Normally 12 molds per day would be completed. The plant will operate on 1 shift as the curing time required reduces the necessity of having staff present. The graphic below show a typical cycle of manufacturing for housing components.

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Once the panels are cured, they are removed from the hydraulic tilting casting tables by use of special lifting apparatus attached to heavy duty forklifts. They are then taken through finishing where small imperfections are attended to and any required surface finishing is applied.

 

Panels are then stored in the pre-manufactured racks until all components for a specific house are complete. We will load our specially fitted trailers with the complete panel sets and ship them to the prepared site via our own transportation and deliver them to the contractor or developer for final construction and finishing of the house.

 

In many cases our trucks can return with raw materials from supplier depots throughout the country.

 

Marketing

 

Once the manufacturing facility is complete, Auscrete will employ a qualified marketing individual to extend its marketing functions when the new production plant is brought online.

 

It is anticipated that full marketing mode can be reached within 3-4 months, certainly much earlier than is necessary to keep the operation at its peak output. The Company will offer a wide range of pre-designed houses and also work with clients to achieve their own design needs.

 

The Company will sell to developers, construction contractors, building companies and individuals. The main thrust of the marketing will be the construction of affordable housing with energy efficiency. Additional markets will be accessed from the small commercial and industrial developments that are part of the future of commerce.

 

The marketing manager will keep abreast of the moving tide of opportunity by use of the many communication systems available today and be able to get involved in short and long term governmental and private projects.

 

Design & Architecture

 

The technology we are using has already been applied to basic design and construction of housing and commercial and industrial structures. We can easily adapt many or our customer’s designs to our construction methods simply by adhering to some basic design criteria within the parameters of our concrete construction and engineering.

 

The chief design engineer will be responsible for the application of new designs utilizing all available technologies to enhance the final renderings. The other responsibility is to lead a team of drafters that will draw each individual panel or section and ensure the accuracy of the fitment prior to dispensing the drawing to the production shop.

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The design department will keep abreast of all new building codes and amendments so that the Auscrete product always conforms to the current regulations of the construction industry.

 

Construction Division

 

The company will employ an experienced and qualified construction manager. The responsibilities of this person are multi fold. Auscrete will be carrying out its own construction during the development of its own campus. The construction manager will administer control of that expansion.

 

Additionally, when the company has its own crew erecting its own products, the construction manager will be able to supervise the ongoing work and final completion of the project.

 

Most importantly will be the liaison with outside contractors and developers ensuring that they are trained and understand the construction methods to be employed when erecting Auscrete products and structures.

 

Internal Administration

 

The position of Administration Manager will be filled by a suitably qualified individual with previous accounts based experience that understands and can perform the daily needs of a public corporation. They will be responsible to senior management for full compliance with securities issues and submissions. As production expands and the company grows, an assistant will be added as required.

 

Safety Officer

 

The safety officer will take care of safety issues that might arise on a day to day basis. A regular schedule of compliance based on OSHA and other regulations and safety checks will be developed as the production gets under way and the safety officer will be responsible for constant observation of these issues.

 

Limited Operating History

 

We cannot guarantee success of our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.

 

Results of Operations for Period Ending December 31, 2011

 

We did not earn any revenues from our incorporation on December 31, 2009 to December 31, 2010, as evidenced by our audited financial statements and for the interim period ended December 31, 2011 as evidenced by unaudited financial statements. We have not attained profitable operations and are dependent upon obtaining financing to continue with our business plan.

 

Public Company Expenses

 

Upon effectiveness of this registration and while the Company works to raise the Minimum Offering, without operations, the Company will incur nominal expenses that will be paid for with the Company’s cash on hand which is currently $9,069. The Company’s cash on hand will also be used to satisfy audit and legal expenses in connection with the reporting requirements for a public company under the Exchange Act of 1934. Any expenses incurred in excess of the Company’s cash on hand may require the Company’s founder to contribute additional cash to maintain the Company as a going concern. If the Company is unable to raise additional capital pursuant to this offering or if the founder is unable to contribute additional capital to the Company to satisfy these reporting company expenses, the Company may have to discontinue operations as a going concern.

 

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

 

We have had no changes in or disagreements with our accountants.

28

 

 

AVAILABLE INFORMATION

 

We have filed a registration statement on Form S-1 under the Securities Act of 1933 with the Securities and Exchange Commission with respect to the shares of our common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits. You may inspect the registration statement, exhibits and schedules filed with the Securities and Exchange Commission at the Commission's principal office in Washington, D.C. Copies of all or any part of the registration statement may be obtained from the Public Reference Section of the Securities and Exchange Commission, 100 F Street NE, Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.

 

The Securities and Exchange Commission also maintains a web site at http://www.sec.gov that contains reports, proxy statements and information regarding registrants that file electronically with the Commission. Our registration statement and the referenced exhibits can also be found on this site.

 

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS

 

Our sole executive officer and the directors and their ages as of the date of this prospectus are as follows:

 

John SprovieriCEO/Director, Age 63

John Sprovieri is a dual American/Australian citizen born in Brisbane, Australia to American parents and is 63 years old. He and his wife, Mary have been married near 43 years and have no children. His background is mechanical engineering and he spent 6 years in construction machinery marketing with Industrial Engineering Limited in Australia becoming Sales Manager for their Contracting Plant Equipment Division.

 

In 1975, he developed an agricultural/industrial tractor and developed both the manufacturing and marketing segments of his company, Australian Tractor Manufacturers Pty. Ltd. The corporation produced nearly 500 units over the next 14 years until he sold the company to Just Australia China Holdings Ltd. (JACH) with interests in China, Korea and Russia. The company was operating profitably at the time it was sold. JACH were setting up overseas operations and were going to manufacture in China or South Korea.

 

John stayed on with the corporation liaising with overseas licensed manufacturers and markets. He traveled extensively into Europe, USSR, the Middle East and North America.

 

Following completion of his obligations to JACH in 1993, he researched the US West Coast Market for low cost housing development, and started a transport company following working with 2 transport companies in Washington and Oregon in various positions throughout the West Coast corridor for nearly 3 years. In 1997 John launched an interstate transport company and was responsible for all facets of management including finance, operations, personnel and government compliance. In 2003, John commenced development of the Auscrete technology and acquired financing to further develop the Cellucon based technology and product with a view to creating an affordable housing manufacturing operation.

 

John’s transport company suffered setbacks in 2003 with the need to write off over $100,000 due to a factoring company not performing their due diligence in checking and following the financial status of some customers. These customers subsequently filed bankruptcy creating the loss. With the increasing cost of fuel and other overheads and the inability to raise rates, it was decided by 2005 to close down operations and concentrate on affordable housing development.

 

During the past nine years since 2003, Mr. Sprovieri has been principally involved with launching and managing the Auscrete of Oregon development activities. During this time, Mr. Sprovieri has set up a manufacturing facility, trained personnel, redeveloped technology and started production of Auscrete Products in 2007.

 

Clifford Jett – Director, Age 71

 

Cliff, at 71 is currently the Mayor of the City of Rufus and has been since 1998. He is chairman of the Lower John Day Regional Partnership and on the Board of Directors of Mid-Columbia Council of Governments. He is also a member of the Mid Columbia Economic Development District and the Lower John Day Area Commission on Transportation.

 

Cliff comes from the Columbia Gorge and has an intimate knowledge of the area. He and his wife, Kay live in Rufus on their small agricultural holding. In his earlier career he became heavily involved in Law Enforcement and, since 1967, spent many years in Nevada commencing as a Conservation Fieldman II for the Nevada Dept. of Fish and Game. Until 1991, he worked through the ranks to achieve Region III L.E. Supervisor status as Fish and Game Agent III at the Nevada Dept. of Wildlife. This diverse career gave Cliff much experience in management, public relations, budgeting, law enforcement knowledge, personnel evaluations and preparation of quarterly and annual reports.

29

 

 

In 1996, Cliff became a city councilman for the City of Rufus and was elected Mayor in 1998. In addition to being a deputy of the Sheriff’s Department in the marine division, he is also a vineyard farmer and a partner in a small museum in the area. Cliff’s 23 years in Law Enforcement gave him the ability to display professionalism and integrity as part of his life’s philosophy. His leadership and problem solving ability make him well qualified to serve on the Board of Directors of this corporation.

 

William Beers – Director, Age 75

 

Bill has lived in Sherman County since 1956 and lives with his wife, Linda in the City of Rufus. He is 75 and recently became semi-retired and is currently a councilman for the City of Rufus and has served for a number of years. Bill is directly involved in the presentation of the city to possible development of local businesses and commercial and industrial enterprises by encouraging potential business people to move to the city’s business park.

 

Bills experience in business management stretches back decades. He has owned and managed a number of business including a truck stop service station and restaurant, all of which he sold when they were operating profitably and are still operating today. Around 10 years ago and at retirement age, Bill and his wife Linda purchased the Hi-Way Market general store and deli in Rufus and shared the business and personnel management responsibilities. Seeking retirement, they leased the business to their employees, two years ago

 

In summary, in the past five years Mr. Beers’ business experience has involved serving as a councilman and running a general store and deli.

 

Significant Events

 

Mr. Sprovieri recently became aware of a judgment entered against him and his previous transport company, Austrak Corporation, in favor of Safeco Insurance Company (“Safeco”). The judgment was entered on 06/21/2007 in Clackamas County Circuit Court, Oregon City, Oregon in the amount of $14,158.79.

 

The complaint giving rise to the judgment relates to a California State (“CA”) matter whereby CA argued that Austrak Corp. failed to renew its license to transport recyclable used tires. Mr. Sprovieri contends that the renewal papers were submitted in a timely fashion and sent a file copy of the renewal form to CA stating that their own office had likely misplaced them. CA restated they had not received them and applied an arbitrary fine for failure to renew. Mr. Sprovieri disputes the reasons and validity of the fine.

 

At the time of the fine, CA required all carriers of used tires to register with the state and post a $10,000 bond in the event that companies fail to ensure hazardous waste handling compliance. CA tried to collect the fine against the Bond issued by Safeco. In discussion with Mr. Sprovieri, Safeco agreed that paying a fine was not the reason for the bond as no hazardous waste or cleanup was involved and advised Mr. Sprovieri that they would not pay out on the Bond. CA subsequently convinced them otherwise without Mr. Sprovieri’s knowledge.

 

Mr. Sprovieri had moved to Rufus OR in November 2006 and was never served personally with the summons and complaint. Following the submission of the S-1 to the SEC, collection lawyers saw Mr. Sprovieri’s name and contacted both he and the company’s attorney, Luc Nguyen. That is when Mr. Sprovieri learned of the judgment. Mr. Sprovieri refutes the claim and will deal with a way to settle this at a future time.

 

Except for the foregoing, during the past ten years, the officer and the directors have not been the subject to any of the following events:

1. Any bankruptcy petition filed by or against any business of which one of the above-named individuals was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.

 

2. Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.

 

3. An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting one of the above-named individual's involvement in any type of business, securities or banking activities.

30

 

 

4. Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission, to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

 

Term of Office

 

Neither our officer nor directors currently has an employment agreement in place and will hold office until removed from office in accordance with our bylaws.

 

Significant Employees

 

The Company currently does not have any employees.

 

EXECUTIVE COMPENSATION

 

Summary Compensation Table

 

The table below summarizes all compensation awarded to, earned by, or paid to our executive officer by any person for all services rendered in all capacities to us for the fiscal period from our incorporation on December 31, 2009 to December 31, 2011 (our fiscal year end) and subsequent thereto to the date of this prospectus.

 

Summary Compensation Table

 

Name and

Principal

Position

Year Salary($)

Stock

Bonus($)

Option

Awards ($)

Non-Equity

Incentive Plan

Awards

Change in

Pension Value

and Nonqualified

Deferred

Compensation

All Other

Earnings

Compensation

Total ($)

John Sprovieri,

CEO/Director

2010 $0 $0 $0 $0 $0 $0 $0

John Sprovieri,

CEO/Director

2011 $0 $0 $0 $0 $0 $0 $0

 

 

Stock Option Grants

 

We have not granted any stock options to our executive officer since our inception.

 

Consulting Agreements

 

We do not currently have an employment or consulting agreement with our officer, or any of our directors or significant employees and none of them currently receive compensation for their services.

 

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

 

The following table provides the names and addresses of each person known to us to own more than 5% of our outstanding common stock as of the date of this prospectus, and by the officer and directors, individually and as a group as of December 31, 2010, except as otherwise indicated, all shares are owned directly.

 

Title of Class

Name and Address of Beneficial

Owner

Amount of Beneficial

Ownership

Percent of Class
Common Stock

Clifford Jett, Director

PO Box 846, Rufus, OR 97050

300,000 Shares, Individually

1,000 Shares, Beneficially through Spouse

17.30%
Common Stock

William Beers, Director

PO Box 825, Rufus, OR 97050

300,000 Shares, Individually

1,000 Shares, Beneficially through Spouse

17.30%
Common Stock

John Sprovieri, Director

PO Box 813, Rufus, OR 97050

975,000 Shares, Individually

1,000 Shares, Beneficially through Spouse

56.00%
Common Stock

VAWT Earth Wind and Power

2393 Sidney, B.C. V8L 3Y3

(Beneficially owned 100% by Rick Plotnikoff)

97,000 Shares 5.60%
Common Stock The Officer and Directors as group that consists of William Beers, Clifford Jett, and John Sprovieri 1,575,000 Shares 90.40%

31

 

 

The percent of class is based on 1,742,500 shares of common stock issued and outstanding as of the date of this prospectus.

 

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

Each of Mr. Beers, Jett, and Sprovieri received 300,000 shares of Auscrete Corporation, no par value, on January 12, 2010 in exchange for services related to the organization of the Company. The value of each of Messrs. Beers’, Jett’s and Sprovieri’s services was $60,000 each. Messrs. Beers and Jett each own 17.30% of the company’s outstanding common stock and, on December 1, 2011, Mr. Sprovieri received 675,000 shares in exchange for certain assets va;ued at $135,000. Mr. Sprovieri owns 56.00% and the group of Beers, Jett and Sprovieri own 90.40%.

 

None of the following parties has, since our date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:

 

• Any relative or spouse of any of the foregoing persons who has the same house as such person;

 

• Immediate family members of directors, director nominees, executive officers and owners of 5% or more of our common stock.

 

Note that Auscrete's sale of building materials to such related parties will be on the same terms as Auscrete's sale of building materials to unaffiliated parties

 

During the past five years, the Company has not entered into any transactions with any promoters of the Company.

 

DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

 

Our officer and the directors are indemnified as provided by the Wyoming Statutes Annotated and our Bylaws. We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to court of appropriate jurisdiction. We will then be governed by the court's decision.

 

32

 

 

AUSCRETE CORPORATION

(A Development Stage Company)

 

 

 

 

FINANCIAL STATEMENTS

 

AND

 

AUDITOR’S REPORT

 

 

* * *

 

DECEMBER 31, 2010

 

 

 

 

33

 

 

AUSCRETE CORPORATION

(A Development Stage Company)

 

DECEMBER 31, 2010

TABLE OF CONTENTS

    Page  
       
Report of Independent Registered Public Accounting Firm   F-1  
       
Audited financial statements for the period from inception (January 1, 2010) to December 31, 2010      
       
Balance Sheet   F-2  
       
Statement of Income   F-3  
       
Statement of Stockholders’ Equity   F-4  
       
Statement of Cash Flows   F-5  
       
Notes to Financial Statements   F-6  
       
Unaudited Financials January 1 to December 31, 2011   F-7 - F-9  

34

 

 

F-1

 

 

 

AUSCRETE CORPORATION  
(A Development Stage Company)  
BALANCE SHEET  
DECEMBER 31, 2010  
       
       
       
       
ASSETS  
       
       
       
CASH   $ 9,069  
         
         
STOCKHOLDERS' EQUITY        
         
STOCKHOLDERS' EQUITY  
Common stock        
Authorized - 500,000,000 shares, no par value        
Issued and outstanding - 1,067,500 shares     213,469  
Retained Earnings (Deficit)     (204,400)  
         
TOTAL STOCKHOLDERS’ EQUITY   $ 9,069  

See accompanying notes to the financial statements

F-2

 

 

AUSCRETE CORPORATION      
(A Development Stage Company)      
STATEMENT OF INCOME      
FOR THE YEAR ENDED DECEMBER 31, 2010      
       
       
       
REVENUES   $ -  
         
OPERATING EXPENSES        
Organization costs     (204,400 )
         
NET INCOME (LOSS) BEFORE TAXES     (204,400 )
         
INCOME TAX EXPENSE     -  
         
NET LOSS   $ (204,400 )

 

See accompanying notes to the financial statements

F-3

 

 

AUSCRETE CORPORATION  
(A Development Stage Company)  
STATEMENT OF STOCKHOLDERS' EQUITY  

FOR THE PERIOD FROM JANUARY 1, 2010 (INCEPTION)

TO DECEMBER 31, 2010

 
    Common Stock    

Retained

Earnings

   

Total

Stockholders'

 
    Shares     Amount     (Deficit)     Equity  
Balance at January 1, 2010     -     $ -     $ -     $ -  
                                 
Issuance of founder shares at no par value per share     925,000       185,000               185,000  
                                 
Common stock issued for cash at no par value per share     45,500       9,069               9,069  
                                 
Common stock issued for services at no par value per share     97,000       19,400               19,400  
                                 
Net loss     -       -       (204,400 )     (204,400 )
                                 
Balance at December 31, 2010     1,067,500     $ 213,469     $ (204,400 )   $ 9,069  

See accompanying notes to the financial statements

F-4

 

 

AUSCRETE CORPORATION  
(A Development Stage Company)  
STATEMENT OF CASH FLOWS  
FOR THE YEAR ENDED DECEMBER 31, 2010  
       
CASH FLOWS FROM OPERATING ACTIVITIES      
Net loss   $ (204,400)  
Non-cash organization costs   204,400  
         
Net cash provided by operating activities   -  
         
CASH FLOWS FROM FINANCING ACTIVITIES      
Issuance of common stock   $ 9,069  
         
Net cash provided by financing activities     9,069  
         
NET INCREASE IN CASH     9,069  
         
CASH, beginning of period     -  
         
CASH, end of period   $ 9,069  
         
         
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES        
         
Organizational services exchanged for 1,022,000 common shares at $0.20/share during 2010   $ 204,400  

See accompanying notes to the financial statements

F-5

 

 

AUSCRETE CORPORATION

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2010

 

 

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The summary of significant accounting policies of Auscrete Corporation is presented to assist in the understanding of the Company’s financial statements. The financial statements and notes are representations of the Company’s management, who is responsible for their integrity and objectivity.

 

Organization – Auscrete Corporation was incorporated in Wyoming on December 31, 2009. The Company was organized for the purpose of establishing a system for making cellular light-weight concrete. They are able to produce affordable housing that is highly energy efficient with excellent sound suppression qualities. As of December 31, 2010, operations have not commenced.

 

Use of estimates – The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain amounts and disclosures. Accordingly, actual results could differ from those estimates.

 

Income taxes – The Company accounts for income taxes in accordance with generally accepted accounting principles, which requires the use of the liability method of accounting for income taxes. Accordingly, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Current income taxes are based on the year’s income taxable for Federal and state income tax reporting purposes.

 

For the period ended December 31, 2010, no income or loss has been generated. Therefore, no provision for income taxes has been made.

F-6

 

 

Auscrete Corporation

(A Wyoming Corporation)

 

BALANCE SHEET
for period ending December 31, 2011
    December 31, 2010        December 31, 2011  
ASSETS   Audited        
             
CASH   $ 9,069     $ 9,069  
             
OTHER ASSEST (Machinery and Equipment)   $ 0     $ 135,000  
             
TOTAL ASSETS   $ 9,069     $ 144,069  
                 
STOCKHOLDER’S EQUITY                
                 
STOCKHOLDER’S EQUITY                
Common Stock                
Authorized – 500,000,000 shares, no par value                
Issued and outstanding – 2010 – 1,067,500 – 2011– 1,742,500   $ 213,469     $ 348,469  
Retained Earnings (Deficit)     (204,400)       (204,400)  
                 
TOTAL STOCKHOLDERS’ EQUITY   $ 9,069     $ 144,069  

F-7

 

 

Auscrete Corporation

(A Wyoming Corporation)

 

STATEMENT OF CASH FLOWS
for period ending December 31, 2011
    December 31, 2010     December 31, 2011  
CASH FLOWS FROM OPERATING ACTIVITIES   Audited        
             
Net Loss   $ (204,400)       -  
                 
Non-cash organization costs     204,400       -  
            $    
Net cash provided by operating activities     -          
                 
CASH FLOWS FROM FINANCING ACTIVITIES           $    
Issuance of common stock     9,069       -  
Cash provided from activities     9,069       -  
CASH, Beginning of Period     0       9,069  
                 
CASH, End of Period     9,069       9,069  
                 

F-8

 

 

Auscrete Corporation

(A Wyoming Corporation)

 

STATEMENT OF STOCKHOLDERS' EQUITY  

FOR THE PERIOD FROM JANUARY 1, 2011

TO DECEMBER 31, 2011

 
    Common Stock    

Retained

Earnings

   

Total

Stockholders'

 
    Shares     Amount     (Deficit)     Equity  
Balance at January 1, 2011     1,067,500     $ 213,469     $ (204,400)     $ 9,069  
                                 
Common stock issued for equipment purchases at no par value per share     675,000       135,000       -     135,000
                                 
Balance at December 31, 2011     1,742,500     $ 348,469     $ (204,400)   $ 144,069  

Notes to Financial Statements


These notes are provided to assist in the understanding of the company prepared financial statements for 2011.


1. Other Assets. The company acquired certain machinery and equipment assets valued at $135,000 in December 2011. They were acquired from Auscrete of Oregon, owned by our officer, John Sprovieri. They comprise 3 groups:


a. Mobile used equipment group (15,000 lb. cap. forklift - 6,000 lb. cap. forklift - tractor with front end loader - Volvo semi road tractor - Ford f 250 diesel pick-up and 20' trailer) has been assigned a purchase value of $ 46,000 which is the depreciated value carried by the Auscrete Oregon company. Used equipment values for this equipment group are freely available and average approx. $52,000.


b. Building. The building is a new 9,000 sq. ft. steel truss industrial structure. Due to the fact that it has never been erected, it has been assigned a purchase value of $78,000. It originally cost $89,000 and was carried on Auscrete Oregon's books at this amount. Similar new industrial buildings vary in price from $ 90,000 to $125,000 and up.


c. Plant. A used concrete batch plant was also acquired. This unit was purchased at an assigned value of $11,000. The unit was originally acquired by the Oregon Company for $16,000 and, after depreciation, was carried at $11,145.


As the assets are used, except for the building, it is expected that depreciation includes the 3 groups with different lives. The mobile equipment (forklifts, trucks and trailers etc) will be straight-line depreciated over 5 years, the plant (concrete batcher etc.) over 7 years and the building, which will be erected upon the successful outcome of the current offering initiative, has a depreciation life of 20 years.


2. As the asset acquisition was at the end of 2011 and without operations, depreciation will be first calculated in the 2012 financial statements.


3. The company issued 675,000 common shares at $0.20 ea. ($135,000) in December 2011 to its officer, John Sprovieri as payment for the assets referred to in 1 above.


4. The company had no operations during the year. This resulted in cash assets remaining the same.


F-9

 

 

PART II: INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution

 

The following table sets forth the costs and expenses payable by Registrant in connection with the sale of the common stock being registered. Registrant has agreed to pay all costs and expenses in connection with this offering of common stock. The estimated expenses of issuance and distribution, assuming the maximum proceeds are raised, are set forth below.

 

SEC Registration Fee   $ 344  
Legal and Professional Fees   $ 4,000  
Accounting Fees   $ 1,000  
Total   $ 5,344  

 

Item 14. Indemnification of Directors and Officer

 

Our Certificate of Incorporation and Bylaws provide that we shall indemnify our officer or directors against expenses incurred in connection with the defense of any action in which they are made parties by reason of being our officer or directors, except in relation to matters as which such director or officer shall be adjudged in such action to be liable for negligence or misconduct in the performance of his duty. Our officer or one of our directors could take the position that this duty on our behalf to indemnify the director or officer may include the duty to indemnify the officer or director for the violation of securities laws.

 

Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Securities Act"), may be permitted to our directors, officers and controlling persons pursuant to our Certificate of Formation, Bylaws, Wyoming laws or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by one of our directors, officers, or control persons, and the successful defense of any action, suit or proceeding) is asserted by such director, officer or control person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by a controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

 

Item 15. Recent Sales of Unregistered Securities.

 

The table on the following page summarizes shares that were recently issued pursuant to Section 4(2) of the Securities Act of 1933 (the "Securities Act") at various dates corresponding with each purchaser. In connection with this issuance, the purchasers were provided with access to all material aspects of the company, including the business, management, offering details, risk factors and financial statements. Each investor also represented to us that he/she was acquiring the shares as principal for his/her own account with investment intent. Each investor also represented that he/she was sophisticated, having prior investment experience and having adequate and reasonable opportunity and access to any corporate information necessary to make an informed decision. This issuance of securities was not accompanied by general advertisement or general solicitation. The shares were issued with a Rule 144 restrictive legend.

 

 

TABLE FOLLOWS ON NEXT PAGE

II-1

 

 

      NAME ADDRESS

Type of

Consideration

Value of

Services

Value of Cash Date

No. of

Shares

1     Clifford D. Jett PO Box 846, Rufus, OR 97050 Services $60,000.00   1/12/2010 300,000
2     John Sprovieri PO Box 813, Rufus OR 97050 Services $60,000.00   1/12/2010 300,000
2     John Sprovieri PO Box 813, Rufus OR 97050 Assets $135,000.00   12/01/2011 675,000
3     William Beers PO Box 825, Rufus OR 97050 Services $60,000.00   1/12/2010 300,000
4     Lynn Komar 61560 Sunny Breeze Lane, Bend OR 97702 Services $5,000.00   1/12/2010 25,000
5     Kathleen D. Jett PO Box 846, Rufus, OR 97050 Cash   $200.00 1/21/2010 1,000
6     Mary E Sprovieri PO Box 813 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
7     Linda Beers PO Box 825, Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
8     Robert Tanner PO Box 54, Grass Valley OR 97029 Cash   $500.00 1/12/2010 2,500
9     Marjorie E. Yarnell PO Box 6, Rufus OR 97050 Cash   $200.00 1/12/2010 1,000
10     Sharon R. Nolan PO Box 745, Rufus OR 97050 Cash   $200.00 1/12/2010 1,000
11     Julie Jett Regnell 1126 Olmo Way, Boulder City NV 89005 Cash   $600.00 1/12/2010 3,000
12     Ryan R. Regnell 1126 Olmo Way, Boulder City NV 89005 Cash   $200.00 1/12/2010 1,000
13     Roderick R. Regnell 1126 Olmo Way, Boulder City, NV 89005 Cash   $200.00 1/12/2010 1,000
14     Larry Barngrover 428 S. Lawndale Dr., Spring Creek, NV 89815 Cash   $200.00 1/12/2010 1,000
15     Ryan P. Sharp PO Box 351, Pendleton, OR 97801-0351 Cash   $200.00 1/12/2010 1,000
16     Daniel J. Hall PO Box 292,Wasco, OR 97065 Cash   $200.00 1/12/2010 1,000
17     George R. Jett PO Box 826, Rufus, OR 97050 Cash   $200.00 1/12/2010 1,000
18     Kelly Louise Means PO Box 12053, Reno, NV 89510 Cash   $200.00 1/12/2010 1,000
19     Jaime Scott McLaughlin PO Box 12053, Reno, NV 89510 Cash   $200.00 1/12/2010 1,000
20     Linda Randle 6060 Oak St., Anderson, CA 96007 Cash   $200.00 1/20/2010 1,000
21     Jimmy Nelson 353 Centerville Hwy., Lyle, WA 98635 Cash   $200.00 1/20/2010 1,000
22     Michael Nilson PO Box 518, Lyle, WA 98635 Cash   $200.00 1/20/2010 1,000
23     Doug Bill 101 Jayden Lane Stevenson WA 98648 Cash   $200.00 1/20/2010 1,000
24     Kimberly A. Grimm PO Box 801, Rufus, OR 97050 Cash   $200.00 1/21/2010 1,000
25     Cory L. Bernard 704 Oak Ave., Hood River, OR 97031 Cash   $200.00 1/21/2010 1,000
26     Kenneth A. Jett PO Box 846, Rufus, OR 97050 Cash   $200.00 2/4/2010 1,000
27     Rebecca Jones 72233 Blalock Cyn. Rd. Arlington,OR 97812 Cash   $200.00 2/4/2010 1,000
28     Karen A. Johnson 300 Circulo Uno Poco, Rohnert Park, CA Cash   $200.00 2/4/2010 1,000
29     Jennifer Bain 4804 Gettysburg Rd.,Knoxville, TN 37921 Cash   $200.00 2/4/2010 1,000
30     Elizabeth A Voiles 6200 Hickson Pike, #202, Hickson TN 37343 Cash   $200.00 2/4/2010 1,000
31     Jose M. Guzman PO Box 703, Rufus, OR 97050 Cash   $200.00 2/4/2010 1,000
32     Christopher Longphre PO Box 631, Stevenson, WA 98648 Cash   $200.00 2/4/2010 1,000
33     Donald Hilderbrand PO Box 148, Wasco OR 97065 Cash   $200.00 2/4/2010 1,000
34     Martin J Kelly PO Box 813 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
35     John Schmidt PO Box 1934 Sandy OR 97055 Cash   $200.00 2/4/2010 1,000
36     Joe Hobbs 210 Webber Street, The Dalles OR 97058 Cash   $500.00 2/4/2010 2,500
37     Billy Sullivan PO Box 614, Hood River OR 97031 Cash   $500.00 2/4/2010 2,500
38     Linda Buchanan PO Box 825 Rufus OR 97050 Cash   $200.00 2/4/2010 1,000
39     Dan Newbold 30303 Maple Drive, Junction City, OR 97448 Cash   $500.00 2/4/2010 2,500
40     Lee Hall 30325 Maple Dr. Junction City, OR. 97448 Cash   $500.00 2/4/2010 2,500
41     VAWT Earth Wind and Power Unit 2393 Sidney, B.C. V8L 3Y3 Services $19,400.00   1/12/2010 97,000
          TOTALS $339,400.00 $9,100.00   1,742,500

Item 16. Exhibits and Financial Statement Schedules.

 

INDEX OF EXHIBITS

 

Exhibit No. Name/Identification of Exhibit
   
3 Articles of Incorporation & Bylaws
   
  3.1 Articles of Incorporation
  3.2 Bylaws
   
5.1 Opinion of Luc Nguyen, Esq.
   
10 Additional Exhibits
   
  10.9 Description of Agreement between Auscrete and VAWT
   
23.1 Consent of Independent Auditor

Notes to Index of Exhibits

Exhibits 3.1 and 3.2 were filed with earlier amendments and have not changed.

Exhibit 5.1 has been amended and is filed herewith.

Exhibit 10.9 was filed with earlier amendments and has not changed.

Exhibit 23.1 was filed with amendment 12 and has not changed.


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Item 17. Undertakings

 

The undersigned registrant hereby undertakes:

 

1. To file during any period in which offers of sales are being made, a post-effective amendment to this registration statement to:

 

(i) Include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

 

(ii) Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low and high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

 

(iii) Include any additional or changed material information on the plan of distribution.

 

2. That, for the purposes of determining any liability under the Securities Act, treat each post-effective amendment as a new registration statement of the securities offered herein, and that the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

3. To remove from registration by means of a post effective amendment any of the securities being registered hereby which remain unsold at the termination of the offering.

 

4. Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to the directors, officers, and controlling persons of the small business issuer pursuant to the By-Laws of the company, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act, and is, therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment of expenses incurred or paid by the director, officer, or controlling person in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or other control person in connection with the securities being registered, we will, , unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit to the court or appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issues.

 

Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

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5. That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

 

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

 

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

 

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

 

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 

 

 

 

SIGNATURE PAGE FOLLOWS

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SIGNATURES

 

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto authorized in the City of Rufus State of Oregon on December 29, 2011.

 

 
Auscrete Corporation
(Registrant)2537895
 
By: /s/ John Sprovieri

John Sprovieri

President, Chief Executive Officer,

Secretary, Treasurer, Chief Accounting Officer,

Chief Financial Officer and Director

 
 

 

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

     
     
Signature Title Date
     
/s/ John Sprovieri . President, Secretary and Director December 29, 2011
John Sprovieri Chief Executive Officer  
     
     
/s/ Clifford Jett Director December 29, 2011
Clifford Jett    
     
     
/s/ John Sprovieri . Treasurer, December 29, 2011
John Sprovieri

Chief Accounting Officer and

Chief Financial Officer

 

 

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