UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB


(Mark One)
[X]      Annual Report under Section 13 or 15(d) of the Securities Exchange Act
         of 1934 For the fiscal year ended December 31, 2003
                                            or
[  ]     Transition Report under Section 13 or 15(d) of the Securities Exchange
         Act of 1934

         For the transition period from _________ to _________

                                    000-28661
                              (Commission File No.)

                               AUGRID CORPORATION
                 (Name of Small Business Issuer in Its Charter)

                     Nevada                                    34-1878390
(State or other jurisdiction of incorporation or            (I.R.S. Employer
                  organization                             Identification No.)

        10777 Westheimer Road, Suite 1040                       77042
                 Houston, Texas                              (Zip Code)
    (Address of principal executive offices)

         Issuer's Telephone Number, including area code: (713) 532-2000

                    Securities registered under Section 12(b)
                     of the Securities Exchange Act of 1934:

                                      None

                    Securities registered under Section 12(g)
                     of the Securities Exchange Act of 1934:

                    Common Stock, $0.001 par value per share


<PAGE>

Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes
[X] No [ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained herein, and no disclosure will be contained, to
the best of the issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. Yes [] No [X]


Issuer's revenues for its most recent fiscal year were $ 111,229.00.

As of April 8, 2004, the aggregate market value of the voting stock held by
non-affiliates, based on the average of the high and the low bid and asked
prices reported on such date, was $.007

As of April 1, 2004, there were 634,510,898 shares of issuer's common stock
outstanding.


Documents Incorporated by Reference: Portions of the issuer's definitive proxy
statement to be filed not later than 120 days after the end of the fiscal year
covered by this form are incorporated by reference in Part III, Items 9, 10, 11,
12 and 14 of this report.

Transitional Small Business Disclosure Format: Yes [ ] No [X]

                                       2
<PAGE>


Introductory Comment

         Throughout this Annual Report on Form 10-KSB, the terms "we," "us,"
"our," "AuGRID" and "our company" refer to AuGRID Corporation, a Nevada
corporation, and, unless the context indicates otherwise, includes our
wholly-owned subsidiaries, Optipure, LLC, Alysium Corporation, and Codestar.

Forward Looking Statements

         In addition to historical information, this Annual Report contains
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933,
as amended. When used in this Annual Report, the words "believe," "may,"
"should," "expect," "anticipate," "plan", "continue," "estimate," "project" or
"intend" and similar expressions identify forward-looking statements regarding
events, conditions and financial trends in connection with our future plan of
operations, business strategy, operating results and financial position. Current
shareholders and prospective investors are cautioned that any forward-looking
statements are not guarantees of future performance. Such forward-looking
statements by their nature involve substantial risks and uncertainties, certain
of which are beyond our control, and actual results for future periods could
differ materially from those discussed in this Annual Report, depending on a
variety of important factors that include, but are not limited to, those
discussed in the section entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Factors that May Affect Future
Results and Market Price of Our Stock" and elsewhere in this Report. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
reflect management's opinions only as of the date hereof. We undertake no
obligation to revise or publicly release the results of any revision to these
forward-looking statements.

Additional Information

         We are subject to the informational requirements of the Exchange Act
and, in accordance with the rules and regulations of the Securities and Exchange
Commission, we file reports, proxy statements and other information. The public
may obtain information on the operation of the from the Public Reference Room by
calling the Commission at 1800-SEC-0330. For further information, the SEC
maintains a website that contains reports, proxy and information statements, and
other information regarding reporting companies at http://www.sec.gov.

         You may find us on the Web at www.augridcorp.com. We do not intend to
incorporate by reference any information contained on our website into this Form
10-KSB, and you should not consider information contained on our website as part
of this Form 10-KSB.


                                       3
<PAGE>



                                     PART I

ITEM 1.       DESCRIPTION OF BUSINESS

Overview

         AuGRID Corporation operates within three business segments:

         o        designing, marketing and distributing consumer electronics,
                  principally in plasma televisions;

         o        development and marketing of nanotechnology-based products,
                  including thermocouples and armor plating;

         o        development and marketing of security-based systems utilizing
                  Radio Frequency Identification (RFID)-technology

         Through our wholly-owned subsidiary, OptiPure LLC, a Nevada limited
liability corporation, we design, market and distribute high-end consumer
electronics We formed OptiPure in July 2003 to establish distribution channels
for innovative electronic devices as well as our future Field Emission Display
(FED) technology. Our goal is to become a provider in the high-end consumer
electronics arena by fulfilling a need in the marketplace. We believe that
through an array of highly original and technologically advanced product lines,
OptiPure's electronic devices address the niche market often ignored or
over-looked by other manufacturers and distribution companies, high-end consumer
electronics, specialty motor-coach and the marine industry. OptiPure is a
limited distributed product line manufactured by third party suppliers in
Taiwan, Hong Kong and Korea according to AuGRID's strict specifications, and
will be sold only through selected authorized dealers and distributors.

         Alysium Corporation, also a wholly-owned subsidiary of AuGRID, is a
manufacturing concern specializing in the fields of thermalcouple advancement,
nanotechnology and armor plating. Alysium is a diversified manufacturer and
distributor. Currently, Alysium is manufacturing and delivering next generation
thermocouples, distributing specialty sensors, drives and motors while
continuing the advancement and testing of its armor plating.

         Our executive offices are located at 10777 Westheimer Rd. - Suite 1040,
Houston, Texas 77042, and our telephone number is (713) 532.2000. We also lease
and maintain an 8,000-square foot manufacturing facility with a state of the art
ISO Clean Room at 3636 Dime Circle, Austin, Texas 78744 for our wholly owned
subsidiary, Alysium Corporation.

                                       4
<PAGE>

Our History

         We were originally formed under the name Ironwood Ventures, Inc. on
August 4, 1995. On April 2, 1998, following a change of control, we changed our
name to AuGRID of Nevada, Inc. We effectively commenced operations on April 15,
1998. On July 26, 2002, we changed our name to AuGRID Corporation.

         AuGRID Corporation is a technology based company in the development
stage. Historically our focus has been specifically on the research and
development of Field Emission Display Technology (FED), for use in the
development of a thin cathode ray tube flat panel display. Commencing in 1997
AuGRID obtained through a contractual agreement with Ceravision, a global
exclusive licensing agreement with manufacturing rights. AuGRID made payments to
the facility in excess of $1.3 million and to date has not obtained a viable
operating FED prototype.

         We currently maintain the exclusive license to manufacture and market
FED flat panel display products. We have no current manufacturing or sales
operations utilizing our rights to such technology due to the laboratories
inability to produce a viable prototype under the agreement.

         AuGRID has re-assessed, re-evaluated and redirected its focus from FED
technology to the development and marketing of the products of its subsidiaries,
OptiPure LLC and Alysium Corporation, to be discussed below.

Financial Information about Our Geographic and Business Segments

         We operate both domestically and internationally in three distinct
business segments. The financial information regarding our geographic and
business segments, which includes net revenues and gross profit for each of the
years in the two-year period ended December 31, 2003, and total assets as of
December 31, 2003 and 2002, is provided in Note 1 to the Consolidated Financial
Statements.


Our Strategy

         The key elements of our corporate strategy are as follows:

                                       5
<PAGE>

         Leverage our capabilities to expand our product offerings. We intend to
leverage our engineering and design capabilities to continue to develop and
evolve differentiated products and services that address both the current and
future needs of consumers, government and businesses for smaller, lighter and
more efficient equipment, and for innovative, value-added service offerings. The
availability and ability to implement cross-over technology from our
subsidiaries to advance our product lines is key to our strategy. This
implementation should allow us to continue to provide leading edge technology to
our products.

OptiPure LLC and Its Products

         OptiPure LLC, a Nevada limited liability corporation, was incorporated
in July 2003 as an independent and wholly-owned distribution subsidiary of
AuGRID Corporation. We believe that OptiPure's electronic devices address the
needs and opportunities in the consumer electronics industry often ignored or
over-looked by other manufacturers and distribution companies.

Optipure markets and distributes, high quality and specialty designed audio and
video products. Our OptiPure product line will consist of seven display devices
ranging from a 17" Wide Screen LCD TV/Monitor to a 60" Plasma TV/Monitor. We
intend to expand our product line to several high performance electronics
components and introduce a new line of display devices with integrated HDTV
tuners some time before the fourth quarter of 2004.

         During the later part of fiscal year 2003 and through the first quarter
of 2004, the product line specifically consisted of select display devices
ranging from a 42" - 60" Wide Screen Plasma TV/Monitor.

         In early September 2003, a small production run arrived in the U.S. and
samples of the products were shipped to distributors and dealers in the U.S. and
abroad. Full distribution was scheduled to hit the U.S. in the second week of
December 2003; however, firmware issues based on input and recommendations by
AuGRID's dealers and distributors resulted in a thirty day delay in delivery.
Because of this delay, we focused on the next level of plasma screens - the
"G3". In [January 2004], we were the first in the U.S. to offer generation three
("G3") plasma glass on a consumer product.

         This was considered a strategic move by our distributors and dealers
since all major manufacturers have already booked substantial amounts of G1 & G2
glass in their fall orders, thus resulting in the need to sell their current
inventory before moving to the new technology. The new G3 glass, although having
similar specifications to the G2 glass, offers a more natural color balance.
Preliminary tests show the G3 to be more power efficient by being able to
operate at a higher voltage with less current. We have initiated the development
of product superiority by first developing firmware to correct issues plaguing
the consumer electronics industry making it the most sophisticated GUI (generic
user interface) in the market today.

                                       6
<PAGE>

         Further, research and development by our Alysium subsidiary has yielded
proprietary intellectual property that should substantially advance the
performance and life of the plasma glass substrate. This technological
advancement should allow the screen to be easier on the eye during long viewing
hours and sustain high quality picture enhancement.

         In January 2004, we displayed these new products at the International
Consumer Electronics Show in Las Vegas, Nevada. This was a very successful
showing for us resulting in the signing of representatives for Pennsylvania,
Delaware, New Jersey, Maryland, Virginia, New York and Ohio, as well as
international representation covering Latin America, Mexico, Australia, Easter
Europe, the Middle East and Russia. In January 2004, our first full container of
Optipure - 42" high definition / high contrast plasma monitors cleared customs
and is currently being distributed to select dealers and representatives for
sale into the marketplace. This is our first product employing our GUI and
firmware soon to be standard in all of our products.

         Distribution/Manufacturing/Warranty/Development

         We believe that OptiPure's products address the needs and opportunities
in the consumer electronics industry often ignored or over-looked by other
manufacturers and distribution companies by offering enhanced performance and or
functionality often desired by the Custom Electronics Design and Installation
Association (CEDIA) members. Our OptiPure product line is sold exclusively
through selected authorized dealers and distributors. Currently, our customer
base consists of approximately 15 dealer and distributor accounts throughout the
United States and abroad.

         Our OptiPure product line is manufactured by third party contract
suppliers in Taiwan, Hong Kong and Korea. These supplies are manufactured
according to AuGRID's strict specifications, and anticipate that the product
line will be sold only through selected authorized dealers and distributors.

         Our OptiPure products come with a one year parts and labor warranty
covering manufacturer's defects and workmanship. Through the existing 2004
warranty program Optipure will exercise a replacement product program for all of
its display devices. All products that fail during the first year of operation
will be exchanged for a new product - with any and all failed units being
returned to the company's research and development for diagnostic analysis in
order to attempt to correct any defects and failures from reoccurring in future
products.

                                       7
<PAGE>

         In an ongoing effort to achieve market superiority the engineers of
AuGRID's other subsidiary, Alysium Corporation, continue to develop proprietary
technology that we intend to crossover to the Optipure product lines. It is
through continued research and the development of crossover technology that
encourages AuGRID's management to continue to evaluate the rebirth of FED
technology and its components while attempting to establish distribution
channels and revenues with OptiPure's current product lines.

Alysium Corporation

         Alysium Corporation, a Texas corporation, is a diversified industrial
manufacturer and distributor with expertise in the areas of thermocouple
manufacturing, armor plating and nano-particle development in the fields of
aerospace, semiconductor, missile defense and other emerging military
technologies.

         We acquired Alysium in August 2003 for 16 million shares of our common
stock plus an additional 34 million shares of our common stock based on Alysium
meeting specific performance goals -- 20 million shares when Alysium generates
$1 million in gross profits and attainment of another 14 million shares when
Alysium generates $10 million in gross sales. These figures are estimated and
based on the current number of employees.

         In 2003, Alysium completed equipment purchases necessary to begin
manufacturing of Alysium's Ultra High Accuracy Thermocouples. In November 2003,
the manufacturing facility initiated production of AuGRID's product line of
Ultra High Accuracy Thermocouples. Preliminary certified tests indicate these
thermocouples are the most accurate thermal devices of its kind now entering the
marketplace. Our customers benefit from a conditional guarantee, a practice not
shared by our competitors. The guarantee is that Alysium thermocouples are
constructed from highest quality materials utilizing our cleanroom environment
and all thermocouple units are tested and certified according to ISO standards.
Other areas where Alysium's engineering is present is in the ability to create
complex geometries, thus permitting a greater freedom of design. Alysium's
products harbor strength and durability three times that of industry standard,
significantly reducing production and maintenance costs for our customers.

                                       8
<PAGE>

         Manufacturing

         Alysium's distribution arm is actively pursuing business relationships
with a variety of manufacturing companies, offering motors, drives, sensors,
bearings and many other temperature and motion control devices.

         Alysium is currently generating revenue from several areas, sales of
thermocouples, distribution sales and engineering consulting. Our marketing team
is now focusing on the integration of our core technologies into other markets
and industries by integrating private label programs, new packaging, catalogs,
pamphlets and ecommerce solutions to the website to accelerate growth.

         Simultaneously, Alysium is making progress on several research and
development projects, including nano particle coating and armor plating. This is
accentuated by the results of testing conducted by autonomous engineers outside
the Alysium environment where our armor plate prototypes was subjected to the
impact of a 7.62 mm by 51 mm standard issue NATO full metal jacket round,
exceeded our initial expectations of engineering goals and computer modeling.
These results have encouraged us to initiate patent filing procedures to protect
our intellectual property. Alysium's goal is to provide small arms protective
inserts (SAPI) and heavy armor to the Defense Department.

Codestar

         Codestar (R) (C) (TM), a Nevada Corporation and wholly owned subsidiary
of AuGRID Corporation which was incorporated in November 2003. Codestar was
established to launch a state-of-the-art security system program. Through
contractual agreement, AuGRID engaged The Database Group, an Akron, Ohio-based
company in the business of writing business custom software programs, to
co-develop a program exclusive to a state-of-the-art integrated security system.
The program, in both written and computerized generated presentation format was
launched by AuGRID Corporation under the name CodeStar, a system that will
utilize radio frequency identification ("RFID") devices linked by an integrated
customized software program and specifically coordinated hardware. Codestar is
inititally being introduced as a security solution for the aviation industry. As
designed, we believe that Codestar will track both baggage and person at the
curb, in the terminals and in the air. Each and every employee, passenger,
service personnel and piece of luggage will be identified and assigned. In
addition, the system allows for categorical separation between employees of the
airport, city employees, service personnel based out of the airport and any
additional staff on duty. Should an employee, passenger, guest of the airport or
their luggage be in an area not associated with their job or itinerary, security
personnel is alerted by the system automatically.

                                       9
<PAGE>

Research and Development

         AuGRID currently has a licensing agreement with CeraVision UK for the
exclusive global distribution with manufacturing rights of the FED Technology.
AuGRID believes that CeraVision has ceased U.S. operations and continues to
operate solely in the U.K. The lack of communication, information and progress
from CeraVision UK on its commitments with AuGRID has prompted the management to
seek counsel for review of all documentation.

         AuGRID is also considering alternative technology-based solutions
developing and acquiring diverse yet synonymous business units. While not
abandoning the FED technology projects or the desire to bring it to market in
several different forms, AuGRID is focusing on enhancing current product lines.

Our Intellectual Property

         Trademarks

         In 2003, we registered our name "Optipure" and our logo with the United
States Patent and Trademark Office under two trademark filings. In 2003, we
trademarked a stylized version of the phrase "Pure Sound, Pure Vision" in the
United States in connection with our Optipure brand. Our trademarks have a
ten-year term commencing on the registration date and are renewable for
additional terms of ten years each, subject to compliance with certain filing
requirements. In 2003, we registered the name "Codestar" and are currently in
the process of registering our trademark with the United States Patent and
Trademark Office under one trademark filing. In addition, AuGRID registered
"Codestar" and our logo with the United States Patent and Trademark Office.

         Patents

                                       10
<PAGE>

         Alysium's scientific team currently has (2) two pending patents. These
applications, US Patent Application #10/465729- International Patent Application
#PCT/US2003/019479, are in the process of being assigned to AuGRID Corporation
upon approval. The intellectual property under the proceeding covers the coating
process of the glass on the plasma units.

         Know-how, trade secrets and other intellectual property protection

         In addition to the trademark protection described above and the pending
patent applications, we will rely on trade secrets, know-how and continuing
technological innovations to develop and maintain our competitive position. It
is our policy to require our directors, employees, consultants and parties to
execute confidentiality agreements upon the commencement of the employment,
consulting or collaborative relationships with us. These agreements provide that
all confidential information developed or made known during the course of the
relationship with us is to be kept confidential except in specific
circumstances. In the case of employees and consultants, the agreements provide
that all inventions resulting from work performed for us using our property or
relating to our business and conceived or completed by the individual during
employment are our exclusive property to the extent permitted by law.


Employees

         We have 12 full time employee(s) and no part-time employees. Our
management team consists of a president/chief executive officer, executive vice
president, chief financial officer and an executive vice president of
communications/corporate secretary. There is no collective bargaining agreement
in effect. We believe the relations with our employees are good.


Factors that May Affect Future Results and Market Price of Our Stock

         We face a number of substantial risks. Our business, financial
condition or results of operations could be harmed by any of these risks. The
trading price of our common stock could decline due to any of these risks, and
they should be considered in connection with the other information contained in
this Annual Report on Form 10-KSB.

                                       11
<PAGE>

Factors Concerning Our Business

         We have incurred losses since our inception. We incurred net losses of
$ 678,212 and $3,252,581 for the years ended December 31, 2002 and 2003. As of
December 31, 2003, we had an accumulated deficit of approximately $ 8,677,053
million. We expect to incur significant operating expenses over the next several
years in connection with the continued development and expansion of our
business. Our expenses include product development and marketing expenses
relating to products that will not be introduced and will not generate revenue
until later periods, if at all. We expect we will continue to experience losses
and negative cash flow, some of which could be significant. Results of
operations will depend upon numerous factors, some of which are beyond our
control, including market acceptance of our products, new product introductions
and competition.

         Our limited operating history and the rapidly evolving nature of our
industry make it difficult to forecast our future results.

         Prior to 2003, our operations consisted primarily of research and
development efforts. As a result of our limited operating history, our
historical financial and operating information is of limited value in predicting
our future operating results. In addition, any evaluation of our business and
prospects must be made in light of the risks and difficulties encountered by
companies offering products or services in new and rapidly evolving markets. The
markets for digital display devices, thermocouples, armor plating and security
oriented software are rapidly evolving, and it is difficult to forecast the
future growth rate, if any, or size of the market for our products. We may not
accurately forecast customer behavior and recognize or respond to emerging
trends, changing preferences or competitive factors facing us, and, therefore,
we may fail to make accurate financial forecasts. Our current and future expense
levels are based largely on our investment plans and estimates of future
revenue. As a result, we may be unable to adjust our spending in a timely manner
to compensate for any unexpected revenue shortfall, which would harm our
operating results.

                                       12
<PAGE>

         Our business may be substantially hurt if we are unable to meet our
future capital requirements.

         Our business strategy requires substantial capital to market and
promote our product lines. We plan to implement our aggressive sales and
marketing plan, provide for adequate working capital to meet the projected
demand for our products and repay debt over the next twelve months. To do this,
we will require approximately $15 million to meet our goals and advance our
technologies, all of which we anticipate will come from offerings of our
securities through several instruments.

         Any inability or delay in raising capital is likely to leave us with
insufficient cash to meet the requirements of our aggressive budget and impede
our ability to pursue our business plan. In addition, development opportunities
and other contingencies may arise, which could require additional capital. Any
inability to obtain required future financing would likely have a materially
adverse effect on our business and could require that we significantly reduce or
suspend our operations, seek a merger partner or sell some or substantially all
of our assets. We presently have no arrangements or understandings with any
prospective merger partner or prospective purchaser of our assets.

         If we issue additional stock to raise capital, your percentage
ownership in us would be reduced. Additional financing may not be available when
needed on terms acceptable to us or at all. If we raise funds through debt
financing, we will have to pay interest and may be subject to restrictive
covenants. If we cannot raise necessary additional capital on acceptable terms,
we may not be able to develop or enhance our products, take advantage of future
opportunities or respond to competitive pressures or unanticipated industry
changes.

         We depend substantially on our relationships with a small number of
OEMs, and our failure to maintain or expand these relationships would reduce our
revenue and gross profit or otherwise harm our business.

         Specific to Alysium Corporation, we anticipate that we will derive a
substantial portion of our revenue from the sale of our products to the small
number of OEM customers we currently serve. While in the long term a substantial
portion of our revenue is projected to be from the thermocouple and defense
market, we expect that our current OEM customers will continue to account for a
consistent flow of revenue and a small portion of our gross profit for the
foreseeable future. The loss of any of these customers, or a material decrease
in revenue from these customers, would reduce our gross profit or otherwise harm
our business.

         As a result of our dependency on a small number of OEMs, any problems
those customers experience could harm our operating results. Some of the factors
that affect the business of our OEM customers, all of which are beyond our
control, include:

                                       13
<PAGE>

         o        the competition these customers face and the market acceptance
                  of their products;

         o        the engineering, marketing and management capabilities of
                  these customers and the technical challenges that they face in
                  developing their products;

         o        the financial and other resources of these customers; and

         o        new governmental regulations or changes in taxes or tariffs
                  applicable to these customers.

The inability of our OEM customers to successfully address any of these risks
could harm our business.

         We are dependent on our suppliers, and the inability of these suppliers
to continue to deliver, or the refusal to deliver our products could
significantly harm our business.

         We do not have agreements with any of our third party Asian suppliers
requiring them to continue to manufacture our Optipure Products. In this
competitive market alternative sources are available but may require up to 30
days-to-initiate delivery of our product lines. This delay would adversely
affect our ability to meet promised demand for our products and harm our
business.


         Competition in our industry is intense and is likely to continue to
increase, which could result in price reductions, decreased customer orders,
reduced product margins and loss of market share, any of which could harm our
business.

         Our industry is competitive and we expect competition to intensify in
the future. We have many primary competitors located in the United States and
globally in the display and thermocouple industries. Additional competitors are
likely to enter our industry in the future.

         Many of our current competitors and potential competitors have longer
operating histories and significantly greater financial, technical, sales and
marketing resources and in some cases greater name recognition than we do. As a
result, these competitors are able to devote greater resources to the
development, promotion, sale and support of their products. In addition, our
competitors that have large market capitalizations or cash reserves are in a
better position to acquire other companies in order to gain new technologies or
products that may displace our products. Any of these potential acquisitions
could give our competitors a strategic advantage. In addition, some of our
current competitors and potential competitors have greater brand name
recognition, a more extensive customer base, more developed distribution
channels and broader product offerings than we do. These companies can use their
broader customer base and product offerings, or adopt aggressive pricing
policies, to gain market share. Increased competition in the market may result
in price reductions, decreased customer orders, reduced profit margins and loss
of market share, any of which could harm our business.

                                       14
<PAGE>

         The market for our thermocouples and consumer electronics is constantly
changing. If we do not respond to changes in a timely manner, the market for our
products could decrease.

         The market for our products is characterized by rapidly changing trends
and technological advancements, new and improved product introductions, changes
in customer requirements and evolving industry standards. Our future success
will depend to a substantial extent on our ability to develop, introduce and
support cost-effective new products and technologies on a timely basis, hence
our continued focus on research and development. If we fail to develop and
deploy new cost-effective products and technologies or enhancements of existing
products on a timely basis, or if we experience delays in the development,
introduction or enhancement of our products and technologies, the market for our
products could decrease and our business will suffer.

         The development of new, technologically advanced products is a complex
and uncertain process requiring high levels of innovation and highly skilled
engineering and development personnel, as well as the accurate anticipation of
technological and market trends. We may not be able to identify, develop,
manufacture, market or support new or enhanced products on a timely basis, if at
all. Furthermore, our new products may never gain market acceptance, and we may
not be able to respond effectively to product announcements by competitors,
technological changes or emerging industry standards. Our failure to respond to
product announcements, technological changes or changes in industry standards
would likely prevent our products from gaining market acceptance and harm our
business.

         If we do not successfully establish strong brand identity in the
markets we are currently serving, we may be unable to achieve widespread
acceptance of our products.

         We believe that establishing and strengthening both of our
subsidiaries' products is critical to achieving widespread acceptance of our
future products and to establishing key strategic relationships. The importance
of brand recognition will increase as current and potential competitors enter
the market with competing products. Our ability to promote and position our
brand depends largely on the success of our marketing efforts and our ability to
provide high quality products and customer support. These activities are
expensive and we may not generate a corresponding increase in customers or
revenue to justify these costs. If we fail to establish and maintain our brand,
or if our brand value is damaged or diluted, we may be unable to attract new
customers and compete effectively.

                                       15
<PAGE>

         We rely on patents, trademarks, trade secrets and confidentiality
agreements to protect our proprietary rights, which afford only limited
protection.

         Our success depends upon our ability to protect our proprietary rights.
We rely on a combination of patent, trademark and trade secret laws, as well as
confidentiality and non-disclosure agreements with our employees, customers,
suppliers and others to establish and protect our proprietary rights. The
protection of patentable inventions is important to our future opportunities. It
is possible that:

         o        our pending patent applications may not result in the issuance
                  of patents;

         o        we may not apply for or obtain effective patent protection in
                  every country in which we do business;

         o        our patents may not be broad enough to protect our proprietary
                  rights;

         o        any issued patent could be successfully challenged by one or
                  more third parties, which could result in our loss of the
                  right to prevent others from using the inventions claimed in
                  those patents; and

         o        current and future competitors may independently develop
                  similar technology, duplicate our products or design new
                  products in a way that circumvents our patents.

         Existing trademark and trade secret laws and confidentiality agreements
afford only limited protection. In addition, the laws of some foreign countries
do not protect our proprietary rights to the same extent as do the laws of the
United States, and policing the unauthorized use of our products is difficult.
Any failure to adequately protect our proprietary rights could result in our
competitors offering similar products, potentially resulting in the loss of some
of our competitive advantage and a decrease in our revenue. Infringement claims
and lawsuits would likely be expensive to resolve and would require management's
time and resources and, therefore, could harm our business.

                                       16
<PAGE>

         Our success depends on retaining our key personnel, including M.J.
Shaheed, our President and Chief Executive Officer, the loss of whom could
disrupt our operations or otherwise harm our business.

         Our success depends on the continued contributions of our senior
management, particularly M.J. Shaheed, our President and Chief Executive
Officer, and other key engineering, sales and marketing and operations
personnel. Competition for employees in our industry can be intense. We have
employment agreements with three executives, but do not have key man life
insurance policies covering any of our executives. In addition, all of the
capital stock and options held by the members of our management are vested.
There can be no assurance that we will retain our key employees or be able to
hire replacements. Our loss of any key employee or an inability to replace lost
key employees and add new key employees as we grow could disrupt our operations
or otherwise harm our business.

         Our international sales will likely account for a significant amount of
our revenue in the future, which may expose us to political, regulatory,
economic, foreign exchange and operational risks.

         Because we intend to sell our products worldwide, our business is
subject to risks associated with doing business internationally. Significant
management attention and financial resources are needed to develop our
international sales, support and distribution channels and manufacturing. Our
future results could be harmed by a variety of factors related to international
operations, including:

         o        foreign currency exchange rate fluctuations;

         o        seasonal fluctuations in sales;

         o        changes in a specific country's or region's political or
                  economic condition, particularly in emerging markets;

         o        unusual or burdensome foreign laws or regulatory requirements
                  or unexpected changes to those laws or requirements;

         o        trade protection measures and import or export licensing
                  requirements,

         o        potentially adverse tax consequences;

         o        longer accounts receivable collection cycles and difficulties
                  in collecting accounts receivables;

         o        difficulty in managing widespread sales, development and
                  manufacturing operations; and

         o        less effective protection of intellectual property.


                                       17
<PAGE>

         In the future, some or all of our international revenue and expenses
may be denominated in foreign currencies. Accordingly, we could experience the
risks of fluctuating currencies and may choose to engage in currency hedging
activities. In addition, if we conduct sales in local currencies, we may engage
in hedging activities, which may not be successful and could expose us to
additional risks.

         Our business may continue to be affected by our substantial debt and
restrictions under debt covenants.

         We have a significant amount of debt. Our debt service obligations
could have material adverse consequences to our security holders. As of December
31, 2003, we have approximately $1.7 million of debt, including various accounts
receivables and approximately $662,000 of secured debt owed to various parties
including but not limited to; Blakemore, Meeker and Bowler, Brouse McDowell,
LLP, James Coco, Just the Two of US, GATO Corp, Tom Paige and William Scala.

         The level of our indebtedness could have important consequences to us
and our stockholders including, but not limited to, the following:

         o        our ability to obtain additional financing in the future may
                  be impaired;

         o        a significant portion of our cash flow from operations must be
                  dedicated to the payment of principal and interest on our
                  indebtedness, thereby reducing the funds available to us for
                  our operations;

         o        we may be substantially more leveraged than certain of our
                  competitors, which may place us at a competitive disadvantage;
                  and

         o        our substantial debt may limit our flexibility to adjust to
                  changing market conditions, reduce our ability to withstand
                  competitive pressures and make us more vulnerable to a
                  downturn in general economic conditions or our business.

         Our ability to make scheduled payments and comply with our debt
covenants or to refinance our debt obligations will depend upon our future
financial and operating performance, which will be affected by prevailing
economic conditions and financial, business and other factors which are beyond
our control. Cash flow from operations and other capital resources may not be
sufficient for payment of our debt in the future. In the absence of such
operating results and resources, we could face substantial liquidity problems
and might be required to dispose of material assets or operations to meet our
debt service and other obligations.

                                       18
<PAGE>

         If we are unable to pay our debt, we may be required to take actions
such as reducing or delaying planned expansion and capital expenditures, selling
assets, restructuring or refinancing our indebtedness or seeking additional
equity capital. We cannot predict whether any of these actions could be affected
on satisfactory terms, if at all.

         We have implemented anti-takeover provisions that could discourage a
third party from acquiring us and consequently decrease the market value of your
investment.

         Our Certificate of Incorporation and bylaws contain provisions that may
have the effect of delaying or preventing a change of control or changes in
management that a stockholder might consider favorable. Our Certificate of
Inception and bylaws, provide for a classified board of directors, allow our
board to designate "blank check" preferred stock, and limit who may call special
meetings of stockholders. These provisions may delay or impede a merger, tender
offer or proxy contest involving us. Any delay or prevention of a change of
control transaction or changes in management could cause the market price of our
common stock to decline.

         Future sales of common stock or senior securities could adversely
affect our common stock price and dilute your interest.

         We may issue additional capital stock in future financing. If a trading
market for our common stock were to develop, sales of substantial amounts of
such shares of common stock or the availability of substantial amounts of such
shares for sale could adversely affect prevailing market prices for our common
stock.

         In addition, we could issue other series or classes of preferred stock
having rights, preferences and powers senior to those of our common stock,
including the right to receive dividends and preferences upon liquidation,
dissolution or winding-up in excess of, or prior to, the rights of the holders
of our common stock. This could reduce or eliminate the amounts that would
otherwise have been available to pay dividends on the common stock.

         Because our executive officers' and directors' liabilities are limited,
your rights against them in a civil lawsuit may be limited.

                                       19
<PAGE>

         We will indemnify any executive officer, director or former executive
officer or director, and may indemnify any other officer or employee, to the
full extent permitted by Nevada law. This could include indemnification for
liabilities under securities laws enacted for stockholder protection, though the
SEC thinks this indemnification is against public policy.

         M.J. Shaheed, our President and Chief Executive Officer, owns a
significant portion of our outstanding common stock and his interests may be
different from, and conflict with, your own.

         The interests of our management could conflict with the interests of
our other stockholders. M.J. Shaheed, our President and Chief Executive Officer,
beneficially owns approximately 5.9% of our outstanding common stock and 60% of
our preferred stock convertible at a rate of 25 to 1 to common shares.
Accordingly, Mr. Shaheed has the power to influence the election of our
directors and the approval of actions for which the approval of our stockholders
is required.

         We do not expect to pay dividends.

         We do not anticipate paying cash dividends in the foreseeable future.
We presently intend to reinvest our cash back into the company rather than
paying dividends to our common stockholders. As a result, your ability to
realize any return on your investment in our common stock will likely result
only from your sale of some or all of your shares.

         The issuance of additional shares of common stock, including shares
issuable upon conversion of the outstanding notes and preferred stock and the
exercise of outstanding options and warrants, will dilute the interests of our
stockholders.

         As of April 1, 2004, we had 634,510,898 shares of our common stock
outstanding. Our board has the ability, without further stockholder approval, to
issue up to approximately 55,489,102 million additional shares of common stock.
Such issuance may result in a reduction of the book value or market price of our
outstanding common shares. Issuance of additional common stock will reduce the
proportionate ownership and voting power of the then existing stockholders.
Thus, the percentage of shares owned by all existing stockholders will be
reduced proportionately as options and warrants are exercised and convertible
notes are converted.


                                       20
<PAGE>

         Our board of directors, without seeking stockholder approval, may
designate and issue up to 1,682,500 shares of preferred stock, and the sale of
such shares may adversely impact the market price of shares of common stock.

         Our Certificate of Incorporation allows our board of directors to issue
at any time without further stockholder approval up to 10,000,000 shares of
preferred stock. Such shares may be issued and sold upon such terms and
conditions as our board of directors may determine, including the amount of
consideration for which the shares may be issued and sold in one or more series,
and such voting rights, designations, preferences and other rights,
qualifications, limitations and restrictions as our board of directors may
determine.

         We have designated 10,000,000 shares of Series A Preferred Stock, the
 rights, privileges and preferences of which are described under "Description of
 Securities - Preferred Stock - Series A Preferred Stock". There are currently
 issued and outstanding 8,317,500 shares of Series A Preferred Stock. We may
 issue up to an additional 1,682,500 shares of Series A Preferred Stock in the
 future. No other shares of our preferred stock are designated outstanding as of
 the date of this document.

         Sales of a substantial number of shares of preferred stock, or the fact
that our board of directors may determine the rights, privileges and preferences
of one or more classes or series of preferred stock, may discourage a future
acquisition of our company, including an acquisition in which you might
otherwise receive a premium for your shares. As a result, stockholders who might
desire to participate in such a transaction may not have the opportunity to do
so.

ITEM 2        DESCRIPTION OF PROPERTY

         Our headquarters are located at 10777 Westheimer Road - Suite 1040,
Houston, Texas, in a high rise office building located in the Westchase Business
District. Our offices are leased from Prentis Properties and is approximately
3800 square feet. The term of the lease is 60 months, commencing November 2003.

Our subsidiary, Alysium Corporation is located at 3636 Dime Circle, Austin,
Texas, 78744, in a manufacturing district. The location leased from Riverside
Properties and is approximately 8000 square feet of office, manufacturing and
warehouse space. The term of the lease is 36 months. The manufacturing facility
includes a 1600-square foot state-of-the-art ISO "CleanRoom" with amenities like
pure gases, high purity de-ionized water, compressed air, chilled water systems
and waste disposal support. This infrastructure will allow us to develop and
manufacture products with the same resources as larger corporations without the
added overhead.


                                       21
<PAGE>

ITEM  3       LEGAL PROCEEDINGS

         In November 2003, Francis Iaconis, through legal proceedings, attempted
to acquire service of certified documentation to both AuGRID Corporation and its
CEO and President, M.J. Shaheed. Inadvertently, knowledge of the service was
acquired by an officer of the Company realizing Mr. Iaconis initiated legal
proceedings against a non-existent Company (AuGRID Corporation of Nevada). The
Company's legal counsel, Blakemore, Meeker and Bowler, LLP, has since accepted
service on behalf of the Company, as well as Mr. Shaheed. The firm has filed
against the allegations of defamation of character and non-payment of wages.

         In October 2003, the Company engaged the services of Baker & Hostetler,
LLP to initiate legal proceedings and investigate the viability of the Company's
Global Exclusive Licensing Agreement with Ceravision Limited, UK. To date, the
process continues to be in the discovery phase.

         There are no other material pending legal proceedings to which AuGRID
Corporation or its subsidiaries are a party to or of which any of their property
is the subject.

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         No matters were submitted to a vote of shareholders during the fourth
quarter of our fiscal year ended December 31, 2003.

                                     PART II

ITEM 5.       MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

         Our common stock is traded on the Over-the-Counter Bulletin Board under
the symbol "AGRD.OB." The following table represents the range of the high and
the low bid quotations, as reported by the OTCBB, for each fiscal quarter for
the last two fiscal years ended December 31, 2002 and 2003. These quotations
represent prices between dealers, may not include retail mark-ups, mark-downs or
commissions, and may not necessarily represent actual transactions.

                                       22
<PAGE>

  Fiscal Quarter Ended                  Low                      High
  --------------------                  ---                      ----

  April 31, 2002                      $ 0.004                   $ 0.01
  June 30, 2002                       $ 0.004                   $ 0.01
  September 30, 2002                  $ 0.05                    $ 0.18
  December  31, 2002                  $ 0.04                    $ 0.11


  April 31, 2003                      $ 0.011                   $ 0.012
  June 30, 2003                       $ 0.022                   $ 0.022
  September 30, 2003                  $ 0.01                    $ 0.01
  December 31, 2003                   $ 0.01                    $ 0.01


         On April 5, 2004, the closing price of our common stock was $0.008 and
we had approximately 700 record owners of our common stock.

Dividends and Dividend Policy

      We have never declared or paid any cash dividends on our common stock. We
anticipate that any earnings will be retained for development and expansion of
our business and we do not anticipate paying any cash dividends in the
foreseeable future. Our board of directors has sole discretion to pay cash
dividends based on our financial condition, results of operations, capital
requirements, contractual obligations and other relevant factors.


Recent Sales of Unregistered Securities

There were no issuances or sales of Company securities by the Company during
2003 that were not registered under the Securities Act.


                                       23
<PAGE>

Repurchase of Securities

         We did not repurchase any of our common stock during the fourth quarter
of 2003.

ITEM 6.       ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         The following discussion and analysis of our consolidated financial
condition and results of operations for the fiscal years ended December 31, 2003
and 2002 should be read in conjunction with our consolidated financial
statements included elsewhere in this Annual Report.

         When used in conjunction in the following discussions, the words
"believes," "anticipates," "intends," "expects," and similar expressions are
intended to identify forward-looking statements. Such statements are subject to
certain risks and uncertainties, which could cause results to differ materially
from those projected, including, but not limited to, those set forth in
"Business -- Factors that May Affect Future Results and Market Price of Our
Stock."

Overview

Comparison of Fiscal 2003 to Fiscal 2002

         Net Sales. Net sales were $111,229 for fiscal 2003 as compared to $0.0
for the year ended 2002. Due to the nature of the Company's products, the
Company's customers have historically tended to be large domestic retailers, and
domestic and international distributors. The Company is dependent upon its
ability to retain existing customers and obtain new customers as well as develop
new product lines for these customers. The Company's failure to retain existing
customers, obtain new customers or develop new product lines could significantly
affect future sales and profitability of the Company. No customer accounted for
10% or more of the Company's net sales for fiscal 2003. As with many of the
Company's customers, the timing and volume of activity can vary significantly
from period to period. The loss of business from one or more principal customers
or a change in the sales volume from a particular customer could have a material
adverse effect on the Company's sales volume and profitability.

         Gross Profit. The Company had gross profits of $60,925 Due to the range
of products that the Company sells, the product sales mix can produce variances
in gross margins. Some markets in which the Company operates also yield lower
gross margins than others.


                                       24
<PAGE>

         Historically, the Company has built infrastructure and added personnel
on an as-needed basis, resulting in occasional changes in manufacturing and
operating expenses that are disproportionate to changes in net sales. This
policy has resulted in and may continue to result in variations in cost of sales
and operating expenses as a percentage of sales from period to period

         Operating Expenses. Operating expenses increased $2,574,374, to
$3,229,127 in fiscal 2003 as compared to $678,758 for the year ended 2002.
Consulting services for acquisition and set up as well as initiating operations
for both subsidiaries resulted in an increase in direct operating costs,
salaries and overall consulting services.

         Income Tax Benefit (Expense). For fiscal 2003, the tax benefit was
$3,252,581 due to a loss before income taxes for the period. For fiscal 2002,
the tax benefit was $678,212 due to earnings before income taxes for the period.
 Deferred taxes of $3,252,581 and $678,212 are recorded as current and long-term
assets, respectively, at December 31, 2003 due to the tax effects of the
temporary differences between the carrying amounts of assets and liabilities for
financial and tax reporting purposes and a net operating loss carryforward
resulting from the net loss for fiscal 2003.

         Net Earnings (Loss). The increase in sales and gross profit and the
increase in research and development expenses contributed to a net loss in
fiscal 2003 of $3,252,581 or $0.01 per share - basic and diluted (based on
554,510,898 million shares outstanding), compared to net loss of $678,212 in
fiscal 2002, or $0.01 per share - basic and diluted .

        Liquidity and Capital Resources. We have experienced cash flow shortages
due to operating losses primarily attributable to research, development,
marketing and other costs associated with our strategic plan as an international
developer and supplier of Plasma Televisions and Thermocouples. Cash flows from
operations have not been sufficient to meet our obligations. Therefore, we have
had to raise funds through several financing transactions. At least until we
reach breakeven volume in sales and develop and/or acquire the capability to
manufacture and sell our products profitably, we will need to continue to rely
on cash from external financing sources. Augrid is seeking new investment
capital to fund research and development and create new market opportunities. In
order to fuel our growth in the market, we will need additional capital to
further these development programs and augment our intellectual properties.


                                       25
<PAGE>

In late December 2003, we entered into a Standby Equity Distribution Agreement
with Cornell Capital Partners. Pursuant to the Standby Equity Distribution
Agreement, we may, at our discretion, periodically issue and sell shares of our
common stock for a total purchase price of $10 million. If we request advances
under the Standby Equity Distribution Agreement, Cornell Capital partners will
purchase shares of common stock of AuGRID for 97% of the lowest closing bid
price on the Over-the-Counter Bulletin Board or other principal market on which
our common stock is traded for the 5 days immediately following the advance
notice date. Cornell Capital Partners will retain 5% of each advance under the
Standby Equity Distribution Agreement. We may not request advances in excess of
a total of $10 million. The aggregate dollar amount of all Puts in any
thirty-day calendar period shall be up to a maximum of Three Hundred Thousand
Dollars ($300,000) and specifically a maximum of Seventy Five Thousand ($75,000)
per Put.

In January, 2004, we issued a Secured Convertible Debenture to Cornell Capital
Partners in the principal amount of $150,000. The convertible debenture is
convertible into shares of our common stock as a price per share that is equal
to the lesser of: (i) an amount equal to 100% of the closing bid price of our
common stock as of the date of the convertible debenture or (ii) an amount equal
to 80% of the average of the lowest daily volume weighted average price of our
common stock for the five trading days immediately preceding the conversion
date. The convertible debenture accrues interest at a rate of 5% per year and is
convertible at the holder's option. The convertible debenture may be paid in
cash or converted into shares of our common stock unless converted earlier by
the holder. Except after an event of default, as set forth in the Secured
Convertible Debenture be entitled to convert such debenture for a number of
shares of common stock of Limelight in excess of that number of shares which,
upon giving effect to such conversion, would cause the aggregate number of
shares of common stock beneficially held by such holder and its affiliated to
exceed 10% of the outstanding shares of common stock of AuGRID.

In the absence of outside financing, we believe that we have sufficient cash to
operate for approximately one (1) month.

The Company believes that at least through fiscal 2004, assuming there are no
unanticipated material adverse developments and no material decrease in
revenues, its cash flows from operations and through credit facilities will be
sufficient to enable the Company to pay its debts and obligations as they
mature. The Company will benefit in fiscal 2004 from expense reductions through
the reduction in the number of employees and other expenses undertaken in fiscal
2003. However, the Company's current sources of funds are not sufficient to
provide the working capital for material growth, and it would be required to
obtain additional debt or equity financing to support such growth. As of March
1, 2004, we continue to seek private accredited investors to purchase Augrid
Corporation common stock. Currently, we are seeking up to $10 million in new
investment funding.

                                       26
<PAGE>

Throughout 2003, management reassessed its current resource allocations and
overhead costs. Management implemented several cost reduction programs including
personnel reductions, work-week modifications and other cost restraint endeavors
to achieve these goals. Personnel levels have been reduced. In early December
2003, management discontinued its modified compensation plan for full-time
salaried employees as well as work-week reductions for other employees. Because
of the workforce reductions and other cost containment policies, the Company
continues to realize a reduction in monthly cash outlays via these cost
reductions without impact to our current operations.

Our operations during the year ended December 31, 2003 were financed by
development contracts and product sales, as well as from working capital
reserves. During the year ended December 31, 2003, our operations required
$3,252,581 more in cash than was generated. We have minimized research and
development spending and increased sales, marketing and administrative expenses
necessary for expansion to meet customer demand. Accounts receivable increased
by $8,195 from $0 from the balance at December 31, 2002. Augrid Corporation
began several new development contacts in the fourth quarter, as noted
throughout this Form 10-K, which we anticipate will increase receivables in
future quarters. Fixed assets increased by $222,478 from $90,981 on December 31,
2002 balances.

         Other assets increased by $2,800 during 2003 from $21,341in 2002 as new
deposits were made on leasing.

Current Liabilities increased by $35,216 to $314,524 in 2003. Long term notes
were increased by $503,053 to $1,176,403 in December 2003

         The future unavailability or inadequacy of financing to meet future
needs could force us to delay, modify, suspend or cease some or all aspects of
our planned operations.


                                       27
<PAGE>

         The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make the appropriate application of certain accounting policies,
many of which require estimates and assumptions about future events and their
effect on amounts reported in the financial statements and related notes. Since
future events and their effect cannot be determined with certainty, the actual
results will inevitably differ from the estimates. Such differences could be
material to the financial statements.

         Accounting Principles and Policies

         The Company's accounting policies are disclosed in Note 1 to the
Company's Financial Statements for the fiscal year ended December 31, 2003. In
July 2001, the Financial Accounting Standards Board (FASB) issued Statement of
Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangibles
Assets. SFAS No. 142 changed the accounting for goodwill and certain intangibles
from an amortization method to an impairment-only approach. Thus, amortization
of goodwill and certain intangibles, including goodwill and certain intangibles
recorded in past business combinations, ceased upon adoption of SFAS No. 142.
Instead, goodwill and certain intangibles are now analyzed for impairment and
written down and charged to operations only in periods in which the recorded
goodwill and certain intangibles is more than its fair value. SFAS No. 142
became effective for the Company's fiscal year beginning December 1, 2002.

         The Company completed the transitional goodwill impairment test and
recorded an impairment loss of $1,822,907 for the year ended December 31, 2001.
In accordance with SFAS No. 142, the goodwill impairment loss is recognized as
the effect of a change in accounting principle as of January 1, 2002. There was
no goodwill amortization expense for the years ended December 31, 2002 and 2003.

         In August 2001, the FASB issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets. This Statement supercedes FASB
Statement No. 121, Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of, and the accounting and reporting provisions
of Accounting Principles Board Opinion No. 30, Reporting the Results of
Operations, Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions, for
the disposal of a segment of a business. SFAS No. 144 maintains the method for
recording an impairment of assets to be held under SFAS No. 121 and establishes
a single accounting model based on the framework established in SFAS No. 121 for
long-lived assets to be disposed of by sale. This Statement also broadens the
presentation of discontinued operations to include more disposal transactions.
SFAS No. 144 became effective as of January 1, 2002. The adoption of SFAS No.
144 did not have a material effect on the Company's financial position or
results of operations.


                                       28
<PAGE>

         In December 2002, the FASB issued SFAS No. 148, Accounting for
Stock-Based Compensation - Transition and Disclosure: An Amendment of FASB
Statement No. 123. This Statement amends SFAS No. 123, Accounting for
Stock-Based Compensation, to provide alternative methods of transition for a
voluntary change to the fair value based method of accounting for stock-based
employee compensation. In addition, this Statement amends the disclosure
requirements of SFAS No. 123 to require prominent disclosures in both annual and
interim financial statements about the method of accounting for stock-based
employee compensation and the effect of the method used on reported results. The
disclosure provisions of SFAS No. 148 are applicable for fiscal periods
beginning after December 15, 2002. The Company continues to account for its
fixed plan stock options under the recognition and measurement principles of
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to
Employees, and related interpretations. The adoption of SFAS No. 148 did not
have a material effect on the Company's financial position or results of
operations.

         Except as described above, there have been no material changes to the
Company's accounting policies during the year ended December 30, 2003. The more
significant of the Company's accounting policies include revenue recognition and
the use of estimates (which inherently involve judgment and uncertainties) in
establishing customer rebate and warranty accrued liabilities, and valuing
accounts receivable, inventory and long-lived and deferred tax assets.
Management has discussed the development and selection of these critical
accounting policies.

Quantitative and Qualitative Disclosures About Market Risk

         The Company has assessed its exposure to market risks for its financial
instruments and has determined that its exposures to such risks are not
material. As of December 31, 2003, the Company had cash and cash equivalents of
$214,758 compared to $1,974 as of December 31, 2002. The Company's cash
equivalents are generally commercial paper and money market accounts. The
Company does not invest in derivative securities.

         The Company sells its products and purchases its inventory primarily in
United States dollars, therefore its exposure to currency exchange rate
fluctuations is not material. The Company does not engage in foreign currency
hedging activities.


                                       29
<PAGE>

         The Company borrows from time to time from certain shareholders. Any
borrowings are based on a 10% interest rate demand note. The Company is not a
party to interest rate swaps or caps. The Company believes any increase or
decrease in the interest rate on borrowings outstanding under the short term
loans would not materially affect the results of operations of the Company.

Critical Accounting Policies

      A summary of significant accounting policies is included in Note 2 to the
audited financial statements. We believe that the application of these policies
on a consistent basis enables us to provide useful and reliable financial
information about our operating results and financial condition.

      The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results may differ from those estimates.

Revenue recognition

      We recognize revenue when product has been shipped from our facility or
drop shipped from our manufacturing location. Revenues from installation or
service sales are recognized when the services have been completed.

Inventory valuation

      Our inventory is stated at lower of cost or market on the first-in,
first-out method of inventory valuation. At December 31, 2003, significantly all
inventory on-hand was finished goods, which consists of motors and generators.
Smaller parts and supplies are charged to expense when purchased.

   Accounting for patents and trademarks

      Our patents and trademarks are stated at cost. The recoverability of
patents and trademarks is re-evaluated each year based upon management's
expectations relating to the life of the technology and current competitive
market conditions. As of December 31, 2003, we have an estimated $ 4900.00,
related to our patents and trademarks. We are amortizing these costs over the
life of respective patent or trademark.

                                       30
<PAGE>

   Stock-based compensation

      We account for stock based compensation utilizing Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation" ("SFAS
123"), which encourages, but does not require, companies to record compensation
cost for stock-based employee compensation plans at fair value. We have chosen
to account for stock-based compensation using the intrinsic value method
prescribed in Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees", and related interpretations. Accordingly, compensation
cost for stock options is measured as the excess, if any, of the estimated fair
market value of our stock at the date of the grant over the amount an employee
must pay to acquire the stock. We have adopted the "disclosure only" alternative
described in SFAS 123 and SFAS 148, which require pro forma disclosures of net
income and earnings per share as if the fair value method of accounting had been
applied.

ITEM  7. FINANCIAL STATEMENTS

         The financial statements required by this item are set forth on pages
F-1 to F-6 and are incorporated herein by this reference.

ITEM  8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         None.

ITEM 8A. CONTROLS AND PROCEDURES

         As of the end of the period covered by this report, our Company
conducted an evaluation, under the supervision and with the participation of our
Chief Executive Officer and Chief Financial Officer, of our disclosure controls
and procedures (as defined in Rules 13a-15(e) of the Exchange Act). Based on
this evaluation, our Chief Executive Officer and Chief Financial Officer
concluded that our company's disclosure controls and procedures are effective to
ensure that information required to be disclosed by us in reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in Securities and Exchange Commission rules
and forms.


                                       31
<PAGE>

         There was no change in our internal controls which are included within
disclosure controls and procedures during our most recently completed fiscal
quarter that has materially affected, or is reasonably likely to materially
affect, our internal controls.


                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT

         The information required by this item is incorporated by reference to
the Proxy Statement.

         We have adopted a code of conduct that applies to our principal
executive officer, principal financial officer, principal accounting officer or
controller, and persons performing similar functions. We will provide any person
without charge, upon request, a copy of such code of ethics by mailing the
request to the Company at 10777 Westheimer Rd. - Suite 1040, Houston, Texas
77042, Attention: Stan Chapman.

ITEM 10. EXECUTIVE COMPENSATION

         The information required by this item is incorporated by reference to
the Proxy Statement and specific sections of the financial report.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
          RELATED STOCKHOLDER MATTERS

            The information required by this item is incorporated by reference
to specific sections of the financial report.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:

The information required by this item is incorporated by reference to specific
sections of the financial report.


                                       32
<PAGE>

ITEM 13.      EXHIBITS AND REPORTS ON FORM 8-K

Exhibits

Exhibits

Reports on Form 8-K

         Form 8-K was filed on April, 26, 2003 announcing a change in directors.
         Form 8-K was filed on August 6, 2003 announcing the resignation of one
         director.

ITEM 14.      PRINCIPAL ACCOUNTANT FEES AND SERVICES

            The information required by this item is incorporated by reference
to specific sections of the financial statements.


                                       33
<PAGE>



                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Securities and Exchange
Act of 1934, as amended, AuGRID Corporation has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.

                      AuGRID Corporation


                  By  /s/ M.J. Shaheed
                      -------------------------------------------------------
                      President,  Chief  Executive  Officer  and  Chairman of
                      the Board (principal executive officer)

Date:  April _____, 2004

         In accordance with Section 13 or 15(d) of the Securities Exchange Act
of 1934, as amended, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>

SIGNATURE                 TITLE                                                DATE
---------                 -----                                                ----
<S>                       <C>                                                  <C>
/s/                       President, CEO and Chairman of the Board             April 13, 2004
M.J. Shaheed              (principal executive officer)

/s/                       Chief Financial Officer and Director                 April 13, 2004
Stan Chapman              (principal financial and accounting officer)

/s/                       Secretary and Director                               April 13, 2004
Mary F. Sloat-Horoszko

/s/                       Director                                             April 13, 2004
Essa Mashni
</TABLE>


                                       34

<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                                     AUDITED
                              FINANCIAL STATEMENTS
                               FOR THE YEARS ENDED
                     DECEMBER 31, 2003 AND DECEMBER 31, 2002



<PAGE>

                               AUGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                              Financial Statements


                                TABLE OF CONTENTS


                                                                     PAGE NO.
                                                                     --------
Auditor's Report

Consolidated Balance Sheets as of December 30, 2003                    2 - 3

Consolidated Statements of Operations for the
          twelve month period ended  December 30, 2003                   4

Consolidated Statement of Retained Earnings
         for the twelve month period ended December 30, 2003             5

Consolidated Statement of Stockholders' Deficit for the
         twelve period ended December 30, 2003                           6

Notes to the Financial Statements -
         As of December 30, 2003                                       7 -11


<PAGE>

                            HENRY L. CREEL CO., INC.
                           Certified Public Accountant
                         (216)491-0800 FAX (216)491-0803


To the Board of Directors and Stockholders of
AUGRID CORPORATION

                          INDEPENDENT AUDITOR'S REPORT

We  have  audited  the  accompanying   consolidated  balance  sheets  of  AUGRID
CORPORATION (A Nevada  corporation in the Development Stage) and subsidiaries as
of December 31, 2003 and 2002, and the consolidated statements of operations ,
stockholders' deficit, and cash flows for the years then ended and the period
from interception of the development stage (March 15, 1998) through December 31,
2003. These financial statements are the responsibility of the Corporation's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statements presentation. We believe that our audits provides a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of AUGRID CORPORATION (A Nevada
corporation in the Development Stage) and subsidiaries as of December 31, 2003
and 2002, and the results of its operations and its cash flows for the years
then ended and the period from the inception of the of the development stage
(March 15, 1998) through December 31, 2003 , in conformity with generally
accepted accounting principles generally accepted in the United States of
America.

The accompanying financial statement have been prepared assuming that the
company will continue as a going concern. The company is a development stage
company engaged in the development and marketing of Flat Panel Display. As
discussed in Note 1 of the financial statements, the company's operating losses
since inception and the deficit accumulated during the development stage raise
substantial doubt about its ability to continue as a going concern. Management's
plan concerning these matters are also described in note 1. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainly.


Henry L Creel Co., Inc
Cleveland, Ohio

March 1, 2004

                    3587 LEE ROAD SHAKER HEIGHTS, OHIO 44120

                                      -1-

<PAGE>

                               AUGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                           Consolidated Balance Sheets
                             As of December 30, 2003

<TABLE>
<CAPTION>
                                     ASSETS

CURRENT ASSETS                                                    December 31          December 31
--------------                                                    -----------          -----------
                                                                     2003                 2002
                                                                     ----                 ----
<S>                                                             <C>                <C>
    Cash                                                        $   214,758        $      1,974
    Accounts Receivables                                              8,195                  -0-
    Inventory                                                         5,414                  -0-
                                                                -----------       --------------

Total Current Assets                                                228,367               1,974

PROPERTY AND EQUIPMENT (Note 1)

    Machinery And Equipment                                         204,832              69,119
    Furniture And Fixtures                                           42,139               7,686
    Office Equipment                                                 66,488              14,176
                                                               ------------       -------------

         Total Property At Cost                                     313,459              90,981

    Less:  Accumulated Depreciation                              (   88,569)           ( 65,115)
                                                              --------------     ---------------

    Net Property and Equipment                                      224,890              25,866
                                                               ------------      --------------

OTHER ASSETS

    Deposits Building Construction                                   24,141              21,341
                                                                -----------      --------------

         Total Other Assets                                          24,141              21,341
                                                                -----------      --------------

TOTAL ASSETS                                                 $      477,398       $      49,181
                                                             ==============       =============
</TABLE>

             See auditors report and notes to financial statements.

                                      -2-

<PAGE>

                               AUGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                       Interim Consolidated Balance Sheets
                             As of December 30, 2003

<TABLE>
<CAPTION>
                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES                                             December 31,       December 31
                                                                    2003              2002
                                                               ------------       -------------
<S>                                                              <C>             <C>
    Accounts Payable                                             $   86,844      $       65,558
    Accounts Payable to Related Parties(Note 3)                     227,680             213,750
                                                               -------------       -------------
         Total Current Liabilities                                  314,524             279,308

LONG-TERM DEBT

    Notes Payable to Stockholders (Note 7)                        1,176,403             673,350
                                                              -------------       -------------
            Long-Term Debt                                        1,176,403             673,350
                                                              -------------       -------------
    Total Liabilities                                             1,490,927             952,658
                                                              -------------        ------------

STOCKHOLDERS' EQUITY

     Preferred Stock $ 0.001 par value
     10,000,000 shares authorized and 8,317,500
     shares issued and outstanding                                    8,318                 318
     Common stock- with $0.001 par value
     700,000,000 shares
      Authorized; Shares outstanding:
    December 30, 2003 - 554,510,898 shares                          554,510              13,217
    Additional paid in capital                                    7,100,695           4,517,459
    Deficit accumulated during
    the development stage                                        (8,677,053)        ( 5,434,471)
                                                               -------------       -------------

         Total Stockholders' Equity (Deficit)                  (  1,013,529)        (   903,477)
                                                               -------------       -------------

TOTAL LIABILITIES AND
    STOCKHOLDERS' EQUITY                                       $    477,398        $     49,181
                                                               ============        ============
</TABLE>

             See auditors report and notes to financial statements.

                                      -3-

<PAGE>

                               AUGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                  Interim Consolidated Statements of Operations
                     For the Period Ended December 30, 2003

<TABLE>
<CAPTION>
                                                                                             Cumulative
                                                                                               From the
                                                                                            Inception to
                                                                                              Dec. 31,
Revenue                                          2003                     2002                   2003
                                             --------------         ---------------         -------------
<S>                                          <C>                    <C>                     <C>
    Net Sales (Note 1)                             111,229                      -0-              111,753

Cost and Expenses
     Write -Off License
     Agreement (Note 1H)                                -0-                     -0-            1,262,908
     Cost Of Goods Sold                             50,304                      -0-               50,304

General and Administrative                       3,290,052                 654,753             6,442,316
Income (Loss) Before Depreciation             (  3,229,127)           (    654,758)           (7,664,775)

    Amortization                                        -0-                     -0-          (   527,306)

    Depreciation                              (     23,454)         (       23,454)         (     88,569)
                                             --------------         ---------------         -------------

Income (Loss) Before Income Taxes            (   3,252,581)           (    678,212)            (8,260,650)

Provision for Income Taxes (Note 2)                     -0-                     -0-                    -0-
                                             --------------         ---------------         -------------

       Net Income (Loss)                     $(  3,252,581)          $(    678,212)           $(8,260,650)
                                             ==============          ==============           ============

    Basic and Diluted                                 (.01)                   (.01)                  (.01)
     Loss Per Share
</TABLE>

             See auditors report and notes to financial statements.

                                      -4-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                      (A Nevada Development Stage Company)

             Interim Consolidated Statement of Stockholders' Deficit
                             As of December 30, 2003

<TABLE>
<CAPTION>
                           Shares of       Addit.         Accum            Accum
                                           Common         Common           Paid in        Prior to        After
                                           Stock          Stock            Capital        March 18        March 18Total
                                           -----          -----            -------        --------        -------------
<S>                      <C>             <C>           <C>                <C>           <C>             <C>
Balance at
 March 8, 1998                                                             (429,352)                       (429,352)

Balance at
December 31, 1998          46,629,414      46,629         1,473,469                     (   429,352)      1,520,098
Net Loss                                                                                (   590,366)        500,380

Balance at
December 31, 1999          49,889,348      50,207         1,945,304                      (1,019,718)        975,475
Net Loss                                                                                (   675,719)        300,074

Balance at
December 31, 2000          58,268,469      58,586         3,653,639                      (1,695,437)      2,016,470
Net Loss                                                                                 (1,171,377)        845,411

Balance at
December 31, 2001          64,364,720      64,683         3,861,286                      (2,866,814)      1,058,837
Net Loss                                                                                 (1,889,445)     (  840,280)

Reverse Split
50 to 1 (51,147,907)

Balance at
December 31, 2002          13,216,813      13,535         4,517,459                      (4,756,259)        225,265
Net Loss                                                                                (   678,212)       (903,477)

Balance at
December 30, 2003         554,510,898     554,828         7,276,377                      (5,434,471)     (2,396,734)
Net Loss                                                                                  3,252,581)
</TABLE>

             See auditors report and notes to financial statements.

                                      -5-
<PAGE>

                               AUGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                      Consolidated Statements of Cash Flows
                             As of December 31, 2003

<TABLE>
<CAPTION>
                                                                             December 31
                                                                           ---------------
                                                            2003                2002                 2003
                                                        -------------       -------------        ------------
<S>                                                       <C>                 <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES
      Net Income (Loss)                                   $(3,252,581)        $ ( 678,212)       $ (8,260,650)
  Adjustments to reconcile Net Income to
  Net Cash provided by Operating Activities:

      Depreciation and Amortization                            23,454              23,454             619,875

Changes in Operating Assets and Liabilities Net:

      Loss on Write off Other Assets                               -0-                 -0-          1,127,959
      Increase(Decrease) in Accounts
      Payable Related Parties                                  13,930             (86,000)            227,680
(Increase)Decrease in  Acct. Receivables                       (8,195)                 -0-            ( 8,195)
      Increase in Accounts Payables                            21,286               1,613              77,748
                                                        -------------       -------------        ------------
      Net Cash (Used) by Operating Activities              (3,202,106)          ( 739,145)       (  6,215,583)

CASH FLOWS FROM INVESTING ACTIVITIES

Increase in Deposits-Building Construction                (     2,800)                 -0-          (  24,141)
      Increase in Inventories                             (     5,414)                 -0-         (    5,414)
      Increase in Licensing Agreement                              -0-                 -0-        ( 1,423,542)
      Purchase of Property and Equipment                    ( 222,478)                 -0-       (    277,327)
                                                         -------------       -------------       -------------
      Net Cash Used in Investing Activities                 ( 230,692)                 -0-        ( 1,730,424)

CASH FLOWS FROM FINANCING ACTIVITIES
      Proceeds from Common Stock Issuance                   3,142,259             613,976           6,587,219
      Proceeds from Notes Payable- to Stockholders            503,053             119,650           1,176,403
                                                          -----------       -------------           ---------
      Net Cash Provided by Financing Activities             3,645,582             733,626           7,763,622
                                                          -----------       -------------           ---------

Increase ( Decrease) in Cash and Cash Equivalents             212,784        (      5,519)            182,385

Cash and Cash Equivalents at Beginning of Year                  1,974               7,493              32,373
                                                        -------------        ------------        ------------

Cash and Cash Equivalents at End of Year                 $    214,758         $     1,974          $  214,758
                                                         ============         ===========          ==========
</TABLE>

             See auditors report and notes to financial statements.

                                      -6-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                          Notes to Financial Statements
                             As of December 31, 2003


Note 1 Organization and Summary of Significant Accounting Policies

      A.    Organization

      AuGRID CORPORATION, (a Development Stage Company) whose name was changed
      from Augrid of Nevada, Inc in August 17, 2002 formed under the laws of the
      State of Nevada. It is a development stage company whose primary business
      is a technology development firm specializing in Thin Cathode Ray Tube
      (TCRT) technology. The company currently has no operating income and, in
      accordance with SFAS #7 is considered a development Company.

      B.    Basis of Presentation

      Th financial records of the company are maintained on the accrual basis of
      accounting. The accompanying financial statements have been prepared on
      the going concern basis which contemplates the realization of assets and
      the satisfaction of liabilities in the normal course of business in
      accordance with generally accepted accounting principles.

      C.    Property and Equipment

      All property and equipment is stated at cost. The Company provides for
      depreciation, using the straight line method, over the estimated useful
      lives of the respective assets, as follows:

                                                                    Years
                                                                    -----
                  Machinery and Equipment         $   69,119         10
                  Furniture and Fixtures              15,562         10
                  Office Equipment                    66,488         10
                                                ------------
                  Total Property & Equipment     $   151,169
                                                 ===========

            Major renewals and improvements of property and equipment are
            capitalized, while replacements, maintenance and repairs which do
            not improve or extend the lives of the assets are charged against
            current operations.

            When property and equipment is disposed of, any gain or loss is
            included in current operations.

            D.    Use of Estimates

            The preparation of financial statements in conformity with general
            accepted accounting principles require management to make estimate
            and assumptions that affect the reported amounts of assets and
            liabilities at the date of the financial statement and the reported
            amounts of revenue and expenses during the reported period. Actual
            results could differ from those estimates.


                                      -7-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                          Notes to Financial Statements
                             As of December 31, 2003

Note 1 Organization and Summary of Significant Accounting Policies ( Continued )

      E.    Going Concern

            The company's financial statements are prepared using the generally
            accepted accounting principles applicable to a going concern, which
            contemplates the realization of assets and liquidation of
            liabilities in the normal course of business. However, the Company
            has no current source of revenue. Without realization of additional
            capital, it would be unlikely for the Company to continue as a going
            concern. The financial statements do not include any adjustments
            relating to the recoverability and classification of recorded assets
            or the amount and classification of liabilities which might be
            necessary should the company continue as a concern. The Company's
            continuation as a going concern is dependent upon its ability to
            generate sufficient cash flows to meet its obligations on a timely
            basis, to obtain additional financing as may be required, and
            ultimately to attain successful operations. It is management's plan
            to begin producing sales in late 2003.

      F.    Research and Development Expense

            The company's policy relating to research and development and patent
            development cost are expensed when incurred except R&D machinery,
            equipment, and facilities which have alternative future uses either
            in R&D activities or otherwise. Machinery, equipment and facilities,
            which have alternate future uses should be capitalized. All
            expenditures in conjunction with an R&D project, including personnel
            cost, materials, equipment, facilities, and intangibles, for which
            the company has no alternative future use beyond the specific
            project for which the items were purchased, are expensed.

      G.    Revenue Recognition

            The company has no current source of Revenue.

      H.    Impairment of Long-Lived Assets & Long -Lived Assets to Be Disposed
            Of

            Statement of Financial Accounting Standards No. 121, "Impairment of
            Long-Lived Assets" (SFAS 121), requires the Company to review for
            possible impairment, assets to be held for use and assets held for
            disposal, whenever events or changes in circumstances indicate that
            the carrying amount may not be recoverable, and in such event, to
            record an impairment loss. The Company adopted SFAS 121 in 1998 and
            evaluated the recoverability of long lived assets at its properties.
            Initial adoption of SFAS 121 in 1998 did not have a material impact
            on the Company's financial condition or results of operations.


                                      -8-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)

                          Notes to Financial Statements
                             As of December 31, 2003

Note 1 Organization andSummary of Significant Accounting Policies ( Continued )

      H.    Impairment of Long-Lived Assets & Long -Lived Assets to Be Disposed
            Of (Cont)

            Up to 2000, the company recorded a charges of $1,822,907 from
            continuing operations relating to an impairment loss on other
            assets. Approximately $1,450,000 was due to a current Licensing
            Agreement while $373,383 was due to a prior Licensing Agreement. The
            company's revenue, which was anticipated from future agreements of
            this type, had not been realized as anticipated, therefore resulting
            in and impairment loss on intangible assets.

      I.    Principals of Consolidation

            Summit Media LLC

            Effective October 31, 2002, the company acquired 51% of Summit
            Media, LLC It will be used as a distribution chain for it products .
            The acquisition was accounted under the purchase method of
            accounting. As part of the agreement Augrid Corporation will not be
            obligated to pay any additional amounts in 2003 or 2004 based on the
            agreement. Due to management approval Summit Media LLc is no longer
            in existence.

            Alysium Corporation

            Effective August 15, 2003 the company acquired 100% ownership of
            Alysium Corporation. The acquisition was aquired under the purchase
            method of accounting. All significant intercompany accounts and
            transactions have been eliminated. Subsidiary losses in excess of
            the unrelated investors' interest are charged against the company
            interest. Changes in the Companys proportionate share of the
            subsidiary equity resulting from the additional equity transaction
            in the consolidation with no gain recognition due to the development
            stage of the subsidiaries and uncertainty regarding the Companys
            ability to continue as a going concern.

      J.    Net Income Per Common Share

            Basic net income per share includes no dilution and is computed by
            dividing income available to common stockholders by the weighted
            average number of common shares outstanding for the period. Diluted
            net income per share reflects the potential dilution of securities
            that could share in the earnings of an entity.


                                      -9-
<PAGE>


                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                          (A Development Stage Company)
                          Notes to Financial Statements
                             As of December 31, 2003

Note 2 Licensing Agreement

            The company has an agreement with Ceravision Limited. Ceravision has
            developed and is developing certain technology relating to
            ceramic-based field emission flat screen displays and hold certain
            patent applications and other intellectual property rights in
            relation to such technology and in relation to manufacturing
            processes and equipment to produce and sell such displays and
            components for incorporation into such displays. The cost incurred
            in relation to this licensing agreement is capitalized. The cost is
            amortized over a period of 5 years.

Note 3 Accounts Payable to Related Parties

            The company enter into consulting agreements with Stockholders, the
            company has violated its agreements by being delinquent in its
            payment to these Stockholders. At December 30, 2003 the company owed
            these related parties (Stockholders) the following amounts $100,000,
            and $120,000 totaling $220,750.These amounts relates to unpaid
            consulting fees and cash advance to company made by stockholders not
            repaid. All amounts due on demand with no interest.

Note 4 Income Taxes

            There was no provision for Federal Income tax during 2003 or 2002
            because of an unexpired net operating loss carry forward.

<TABLE>
<CAPTION>
                                                                              Carryforward
                  Year Ended                        Amount                  Available to Year
                  ----------                        ------                  -----------------
<S>                                             <C>                         <C>
                  December 31, 1998              1,019,718                        2013
                  December 31, 1999                675,719                        2014
                  December 31, 2000              1,171,377                        2015
                  December 31, 2001              1,889,445                        2016
                  December 31, 2002                678,212                        2017
                  December 30, 2003              3,252,581                        2018
</TABLE>

            The Company has a net operating loss carryforward of $8,260,630
            which expires, if unused, in the years 2013 to 2018. The following
            is a reconciliation of the income tax benefit computed at the
            federal statutory rate with the provision for income taxes for the
            period ended 2002 and 2003.

                                                            2002          2003
                                                            ----          ----
       Income tax benefit at the statutory rate (34%)    678,212     3,252,581
       Change in valuation allowance
       State tax, net of federal benefit
       Non included items
       Provision for income taxes                              0             0
                                                        ========    ==========


                                      -10-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                      (A Nevada Development Stage Company)

                          Notes to Financial Statements
                             As of December 31, 2003


Note 5 Capitalization

            On March 1, 1998, Augrid Corporation`s current controlling
            stockholders purchased controlling interest in Ironwood Ventures via
            the purchase of approximately 4,616,111 shares of Common Stock of
            Ironwood Ventures' in private transactions; this represented
            approximately 62.2 percent (62.2%) of Ironwood Ventures' issued and
            outstanding Common Stock.

            On March 2, 1998, Ironwood Ventures' executed a forward stock split
            of its stock, 6.06571228 to 1. In addition, Ironwood Ventures'
            increased its authorized shares to 90,000,000 common shares, par
            value $0.001, 10,000,000 preferred shares, par value $0.001, and
            changed its name to AuGRID of Nevada, Inc

            On March 12, 1998, Ironwood Ventures' - now called AuGRID of Nevada,
            Inc - executed an asset purchase agreement purchasing substantially
            all of the assets of Augrid Corporation, a Delaware corporation
            hereinafter referred to as "Augrid of Delaware", a company under
            common control by the control stockholders of the Ironwood
            Ventures', for 1,000,000 newly issued shares of the Ironwood
            Ventures'. This was not a third party, arms length transaction, and
            due to the development stage and specialized nature of the
            assets\technology that Ironwood


            Ventures' purchased, the Company's management is unable to determine
            how this transaction would compare to a similar arms length
            transaction. The shares of common stock were spun off to Augrid of
            Delaware shareholders on a pro-rate basis on March 13, 1998.

            On August 17, 2002 at the Companys annual shareholders meeting the
            company changed its name to AuGRID Corporation and initiated a 50 to
            1 reverse split which decreased the amount of shares outstanding to
            13,216,813 outstanding at March 31, 2003.


                                      -11-
<PAGE>

                               AuGRID CORPORATION
                                AND SUBSIDIARIES
                      (A Nevada Development Stage Company)

                          Notes to Financial Statements
                             As of December 31, 2003

Note 6 Net Loss Per Share

            The Company follows the provisions of Statement of Financial
            Accounting Standards No. 128, earnings per share (SFAS 128)


            The following table presents the calculation.

                      Net Loss                                  $    3,252,581

                  Basic:
                      Weighted average share of
                      Common stock outstanding                     554,510,898
                                                                --------------
                      Basic net loss per share                           ( .01 )
                  Pro forma :
                      Shares used above                            554,510,898
                      Pro forma adjusted to reflect
                      Weighted affect of assumed
                      Conversion of preferred stock                  8,317,500
                                                                --------------
                      Shares used in computing pro forma
                         Basic net loss per share                  554,828,298
                                                                --------------
                      Pro forma basic net loss per share                 ( .01 )

Note 7 Notes Payable to Stockholders

            Notes payable to stockholders represents demand notes that matured
            on 01/28/01 with interest at 12%. The matured notes were converted
            into 18 Month Demand notes at 10% interest totaling $ 1,176,403.

                  Notes Payable to Stockholders- Long Term        $    1,176,403

Note 8 Reclassification

            Certain balances have been reclassified in the 2001 and from
            inception to March 31, 2003 consolidated financial statements to
            conform to the 2003 presentation.

Note 9 Commitments

            Employment Agreements - The Company has entered into employment
            agreements that extend to December 31, 2008 with three officers. The
            employment agreements set forth annual compensation to its officers
            of between $225,000 and $175,000 each. Compensation is adjusted
            annually based on the cost of living index plus seven percent per
            annum base increase; plus an eight and one-half percent bonus of net
            pretax income exclusive of the 401(k)/profit-sharing contribution.


                                      -12-

<PAGE>

      Exhibit 23 - Consent of Certified Public Accountants

      Exhibit 99 - Certifications of Chief Executive Officer and Chief Financial
Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

In accordance with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002, our Chief Executive Officer and Chief Financial
Officer executed the following written statements which statements accompanied
the filing with the Securities and Exchange Commission of this Report on Form
10-K:


          Certification Pursuant To 18 U.S.C. Section 1350, As Adopted
           Pursuant To Section 906 of The Sarbanes-Oxley Act of 2002

I, M. J. Shaheed, President and Chief Executive Officer of AuGRID Corporation
(the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that:

-     the Company's Annual Report on Form 10-K for the fiscal year ended
      December 31, 2003, as filed with the Securities and Exchange Commission on
      the date hereof (the "Report") fully complies with the requirements of
      Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

-     the information contained in the Report fairly presents, in all material
      respects, the financial condition and result of operations of the Company
      for the periods presented therein.


          Certification Pursuant To 18 U.S.C. Section 1350, As Adopted
           Pursuant To Section 906 of The Sarbanes-Oxley Act of 2002

I, Stan Chapman, Treasurer of AuGRID Corporation (the "Company"), certify,
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section
1350, that:

-     the Company's Quarterly Report on Form 10-K for the fiscal year ended
      December 31, 2003, as filed with the Securities and Exchange Commission on
      the date hereof (the "Report") fully complies with the requirements of
      Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

-     the information contained in the Report fairly presents, in all material
      respects, the financial condition and result of operations of the Company
      for the periods presented therein.


                                   SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                  AuGRID Corporation


                                   By:/S/ M. J. SHAHEED
                                   ----------------------------------
                                   M. J. Shaheed President, Chief Executive
                                   Officer and Chairman Date: April 13, 2004