U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB
(Mark One)

[X]      QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
         ACT OF 1934

         For the quarterly period ended June 30, 2002
                                        -------------

[ ]      TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

         For the transition period from               to
                                        --------------   ------------------

                        Commission File Number: 0-22341

                                   AUG CORP.
        -----------------------------------------------------------------
        (Exact name of Small Business Issuer as specified in its Charter)

             Delaware                                   04-3089539
-------------------------------            ------------------------------------
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)

           1900 Corporate Blvd., Suite 305W, Boca Raton, Florida 33431
 -------------------------------------------------------------------------------
                    (Address of principal executive offices)
                                 (561) 241-9921
                                 --------------
                           (Issuer's telephone number)


--------------------------------------------------------------------------------
         (Former Name, former address and former fiscal year, if changed
                              since last Report.)

         Check mark whether the Issuer (1) has 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 [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

         State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 90,334,964 shares of Common
Stock as of June 30, 2002.


<PAGE>
<TABLE>
<CAPTION>

                                      INDEX
                                                                                Page
                                                                                ----
<S>                                                                              <C>
PART I.  FINANCIAL INFORMATION                                                   3
         ---------------------

Item 1.  Condensed Financial Statements (unaudited)                              3

         Condensed Balance Sheets                                                3

         Condensed Statements of Operations                                      4

         Condensed Statements of Cash Flows                                      5

         Notes to Condensed Financial Statements                                 6-12

Item 2.  Management's Discussion and Analysis and Plan of Operations             13


PART II. OTHER INFORMATION                                                       15
         -----------------

Item 1.  Legal Proceedings                                                       15

Item 2.  Changes in Securities and Use of Proceeds                               15

Item 3.  Defaults Upon Senior Securities                                         16

Item 4.  Submissions of Matters to a Vote of Security Holders                    16

Item 5.  Other Information                                                       16

Item 6.  Exhibits and Reports on Form 8-K                                        16
</TABLE>



                                       2
<PAGE>
<TABLE>
<CAPTION>
PART I.  FINANCIAL INFORMATION
         ---------------------

Item 1.  Condensed Financial Statements

                                        AUG CORP. AND SUBSIDIARY
                                        CONDENSED BALANCE SHEETS

                                                                         June 30, 2002
                                                                        (Consolidated)     December 31,
                                                                          (Unaudited)         2001
                                                                         -------------    -------------
<S>                                                                       <C>             <C>
                                     ASSETS
CURRENT ASSETS
 Cash and cash equivalents                                                $    389,313    $     36,079
 Cash advance for pending merger                                                    --         600,000
 Accounts receivable, net                                                       20,359              --
 Prepaid expenses and other assets                                              17,251              --
                                                                          ------------    ------------
       Total Current Assets                                                    426,923         636,079

Furniture, fixtures and equipment, net                                         190,672              --
Goodwill                                                                    19,977,468              --
                                                                          ------------    ------------

TOTAL ASSETS                                                              $ 20,595,063    $    636,079
                                                                          ============    ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                                                         $    164,771    $         --
 Accrued expenses                                                               33,317           7,258
 Loans payable to related party                                                375,000              --
                                                                          ------------    ------------
       Total Current Liabilities                                               573,088           7,258
                                                                          ------------    ------------

STOCKHOLDERS' EQUITY
 Preferred stock, Series A, $0.01 par value, 2,000,000 shares
  authorized, none issued and outstanding                                           --              --
 Common stock, $0.0001 par value, 148,000,000 shares authorized,
  90,334,964 and 82,189,964 shares issued and outstanding, respectively          9,035           8,220
 Common stock to be issued (15,850,259 shares)                              21,736,948              --
 Additional paid-in capital                                                 23,299,751      22,991,815
 Accumulated deficit                                                       (25,023,759)    (22,371,214)
                                                                          ------------    ------------
       Total Stockholders' Equity                                           20,021,975         628,821
                                                                          ------------    ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $ 20,595,063    $    636,079
                                                                          ============    ============
</TABLE>
                                       3


<PAGE>
<TABLE>
<CAPTION>
                                        AUG CORP. AND SUBSIDIARY
                                   CONDENSED STATEMENTS OF OPERATIONS
                                               (UNAUDITED)


                                                        For the Three                      For the Six
                                                      Months Ended June   For the Three    Months Ended    For the Six
                                                           30, 2002       Months Ended    June 30, 2002   Months Ended
                                                        (Consolidated)    June 30, 2001   (Consolidated)  June 30, 2001
                                                      -----------------   -------------   -------------   -------------
<S>                                                    <C>                 <C>             <C>             <C>
NET REVENUES                                           $     33,100        $         --    $     34,990    $         --
                                                       ------------        ------------    ------------    ------------

OPERATING EXPENSES
   General and administrative                               678,841               9,100       1,081,885          20,543
   Salaries, wages and consulting                           516,334                  --         967,066              --
   Professional fees                                        388,107                  --         638,584              --
                                                       ------------        ------------    ------------    ------------
       Total Operating Expenses                           1,583,282               9,100       2,687,535          20,543
                                                       ------------        ------------    ------------    ------------

LOSS BEFORE EXTRAORDINARY GAIN                           (1,550,182)             (9,100)     (2,652,545)        (20,543)

EXTRAORDINARY GAIN
  Gain on extinguishment of debt                                 --                  --              --       1,665,043
                                                       ------------        ------------    ------------    ------------

NET (LOSS) INCOME                                      $ (1,550,182)       $     (9,100)     (2,652,545)   $  1,644,500
                                                       ============        ============    ============    ============


Net (loss) income per share of common stock - basic
 and diluted                                           $      (0.02)       $      (0.01)   $      (0.03)   $       2.24
                                                       ============        ============    ============    ============


Weighted average number of shares outstanding during
 the period - basic and diluted                          89,656,408           1,314,964      87,474,384         732,645
                                                       ============        ============    ============    ============
</TABLE>



                                       4
<PAGE>
<TABLE>
<CAPTION>
                                           AUG CORP. AND SUBSIDIARY
                                      CONDENSED STATEMENTS OF CASH FLOWS
                                                  (UNAUDITED)

                                                                          For the Six Months     For the Six
                                                                          Ended June 30, 2002   Months Ended
                                                                            (Consolidated)      June 30, 2001
                                                                          -------------------   -------------
<S>                                                                          <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net (Loss) Income                                                           $(2,652,545)        $ 1,644,500
 Adjustments to reconcile net (loss) income to net
  cash used in operating activities:
    Issuance of common stock for services                                         13,750                  --
    Extraordinary gain on extinguishment of debt                                      --          (1,665,043)
    Depreciation                                                                  48,879                  --
 Changes in assets and liabilities:
  Accounts receivable                                                            (20,359)                 --
  Prepaid expenses and other current assets                                       67,239                  --
  Accounts payable                                                                65,691                  --
  Accrued expenses                                                                15,507              (1,419)
                                                                             -----------         -----------
       Net Cash Used In Operating Activities                                  (2,461,838)            (21,962)
                                                                             -----------         -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of furniture, fixtures and equipment                                 (197,363)                 --
 Cash acquired in merger acquisition                                             187,435                  --
                                                                             -----------         -----------
       Net Cash Used In Investing Activities                                      (9,928)                 --
                                                                             -----------         -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from the issuances of common stock and
  common stock to be issued                                                    2,450,000                  --
 Proceeds from loans                                                             375,000                  --
                                                                             -----------         -----------
       Net Cash Provided By Financing Activities                               2,825,000                  --
                                                                             -----------         -----------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                 353,234             (21,962)

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                                   36,079              29,172
                                                                             -----------         -----------

CASH AND CASH EQUIVALENTS - END OF PERIOD                                    $   389,313         $     7,210
                                                                             ===========         ===========
</TABLE>
SUPPLEMENTAL CASH FLOW INFORMATION:
-----------------------------------
Non-Cash Investing and Financing Activities:

During the six months ended June 30, 2002, 275,000 shares valued at $0.05 per
share were issued for the payment of services valued at $13,750.

During the six months ended June 30, 2001, 65,743 shares valued at $658
were issued for the extinguishment of debt consisting of notes and interest
valued at $1,665,701. A gain on extinguishment of debt was recognized for
$1,665,043.

                                       5
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

NOTE 1 ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------ -----------------------------------------------------------

       (A) Organization
       ----------------

       AUG Corp. (the "Company") was incorporated in 1990 to develop and
       distribute fiber optic printed circuit boards in the publishing and
       printing markets. The fiber optic products had limited success and in
       fiscal 1994 the Company began phasing out the fiber optic operations and
       began the transition into a systems integration and engineering
       consulting business. In 1995, the Company made a strategic shift in its
       business operation into the server market.

       In November 1998, the Company was informed by the investment bank that
       had provided financing that they would be unable to secure the additional
       funding required to repay an outstanding bridge loan and provide the
       Company with the necessary working capital to support its plan and
       ongoing operations. The Company began to seek alternative financing, but
       was unable to secure the necessary funds for extinguishment of the bridge
       loan.

       In January 1999, the Board of Directors decided to seek buyers, strategic
       partners and merger opportunities to make the Company economically
       viable.

       On March 11, 2000, Right2Web.Com, Inc. acquired 1,416,700 shares of the
       Company's preferred stock convertible into 92% of the outstanding shares
       of the Company's common stock. In return for the shares of preferred
       stock, Right2Web.Com, Inc. undertook to satisfy the Company's current
       debt and obligations and fund its operations. The transaction was valued
       at $40,480 and was accounted for as a reverse merger in 2000. The
       preferred stock was converted into common stock in 2001.

       In September 2001, the Board of Directors and a majority of the
       stockholders of the Company voted to change the name of the Company to
       AUG Corp. The name change became effective on October 29, 2001.

       Effective August 31, 2001, the Company entered into a Stock Purchase
       Agreement ("Agreement") with the purchaser, a Curacao, Netherlands
       Antilles corporation. Under this Agreement, the purchaser purchased
       2,000,000 shares of the Company's Series A Preferred Stock, par value
       $.01 and 670,854 shares of the Company's common stock (post 100:1 reverse
       stock split) for the sum of $400,000. The preferred shares were converted
       into an aggregate of 40,000,000 common shares, par value $.0001, upon the
       completion of a 100:1 reverse stock split of the Company's common stock.

                                       6
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

       In addition, under the Agreement, the Company issued warrants to a
       company related to and controlled by the purchaser to purchase 10,000,000
       shares of the Company's common stock exercisable at $.01 per share until
       November 30, 2001; warrants to purchase 20,000,000 shares of the
       Company's common stock exercisable at $.05 per share until August 31,
       2004; and warrants to purchase 20,000,000 shares of the Company's common
       stock exercisable at $.10 per share until August 31, 2006. In November
       2001, the Company issued 10,000,000 shares of common stock in exchange
       for the 10,000,000 warrants that were exercisable at $.01 per share. In
       accordance with the Agreement, the Company also issued to another company
       controlled by the purchaser a cash-less exercisable option to purchase
       2,000,000 shares of the Company's common stock along with warrants to
       purchase 1,000,000 shares of the Company's common stock exercisable at
       $.05 per share until August 31, 2004 and was also issued warrants to
       purchase 1,000,000 shares of the Company's common stock at $.10 per share
       until August 31, 2006. In November 2001, the Company issued the 2,000,000
       shares of common stock upon the cash-less exercise of the related
       options.

       In January 2002, the Company acquired 100% of the common stock of
       Synthesys Secure Technologies, Inc. ("Synthesys"). The purchase price of
       the investment amounted to $20,181,948, and was comprised of a cash
       payment of $600,000 made in December 2001, and the issuance of 5,350,259
       shares of restricted common stock valued at $19,581,948. The shares were
       valued at the average quoted trading price during the acquisition period
       (See Note 4). The fair value of the investment at the acquisition date
       was determined to be $204,480. The excess of the purchase price over the
       fair value of the investment in the amount of $19,977,469 was accounted
       for as goodwill.

       Synthesys was formed on May 18, 2001 in the state of Florida. Synthesys
       is a global security solutions company specializing in security access to
       computer networks, buildings, offices, and other secure areas. Synthesys
       develops and markets a variety of innovative security-based products that
       are used to secure databases, to authenticate people over the phone, over
       the computer, and via cameras.

       (B) Principles of Consolidation
       -------------------------------

       The accompanying condensed consolidated financial statements for 2002
       include the accounts of Aug Corp and its wholly owned subsidiary
       Synthesys. All significant intercompany transactions and balances have
       been eliminated in consolidation. The pre-acquisition financial
       statements for 2001 only included the accounts of the parent company, Aug
       Corp.

                                       7
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

       (C) Use of Estimates
       --------------------

       In preparing condensed consolidated financial statements in conformity
       with accounting principles generally accepted in the United States of
       America, management is required to make estimates and assumptions that
       affect the reported amounts of assets and liabilities and the disclosure
       of contingent assets and liabilities at the date of the condensed
       consolidated financial statements and revenues and expenses during the
       reported period. Actual results could differ from those estimates.

       (D) Income (Loss) Per Common Share
       ----------------------------------

       Basic earnings (loss) per common share are based on net income (loss)
       divided by the weighted average number of common shares outstanding.
       Diluted earnings per common share are adjusted to reflect the incremental
       number of shares issuable for the assumed conversion of common stock
       purchase warrants if such adjustments are dilutive. Warrants to purchase
       42,000,000 shares of common stock were not included in the calculation of
       diluted EPS for "loss before extraordinary item" as the effect would be
       anti-dilutive. Additionally, there were no common stock equivalents
       outstanding for the three and six months ended June 30, 2001. The
       weighted average shares outstanding for the three and six months ended
       June 30, 2001 have been restated for the reverse stock splits that
       occurred in 2001.

       (E) Interim Condensed Consolidated Financial Statements
       -------------------------------------------------------

       The condensed consolidated financials statements as of June 30, 2002 and
       for the three and six months ended June 30, 2002 and the condensed
       financial statements of the parent company for the three and six month
       ended June 30, 2001 are unaudited. In the opinion of management, such
       financial statements include all adjustments (consisting only of normal
       recurring accruals) necessary for the fair presentation of the financial
       position and the results of operations. The results of operations for the
       three and six months ended June 30, 2002 (consolidated) and for the three
       and six months ended June 30, 2001 are not necessarily indicative of the
       results to be expected for the full year. The condensed balance sheet
       information as of December 31, 2001 was derived from the audited
       financial statements included in the Company's Annual Report Form 10-KSB.
       The interim condensed financial statements should be read in conjunction
       with that report.

                                       8

<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

       (F) Furniture, Fixtures and Equipment
       -------------------------------------

       Furniture, fixtures and equipment are stated at cost less accumulated
       depreciation. Depreciation is computed using accelerated methods over the
       estimated economic useful lives of 5 to 7 years. Expenditures for repairs
       and maintenance are charged to expense as incurred and major improvements
       are capitalized.

       (G) Impairment of Long-Lived Assets
       -----------------------------------

       The Company has evaluated its long-lived assets for financial impairment,
       and will continue to evaluate them as events or changes in circumstances
       indicated that the carrying amount of such assets may not be fully
       recoverable.

       The Company evaluates the recoverability of long-lived assets not held
       for sale by measuring the carrying amount of the assets against the
       estimated undiscounted future cash flows associated with them. At the
       time such cash flows of certain long-lived assets are not sufficient to
       recover the carrying value of such assets, the assets are adjusted to
       their fair values.

       (H) Revenue Recognition
       -----------------------

       Revenue is recognized when all significant contractual obligations have
       been satisfied and collection of the resulting accounts receivable is
       reasonably assured. Revenue from software and engineering services are
       recognized at the time of delivery according to contractual terms and are
       recorded net of discounts and allowances.

       (I) Going Concern
       -----------------

       The Company's condensed consolidated financial statements have been
       presented on the basis that it is a going concern, which contemplates the
       realization of assets and the satisfaction of liabilities in the normal
       course of business. For the six months ended June 30, 2002, the Company
       has a net loss of $2,652,545 and a negative cash flow from operations of
       $2,461,838, and has a working capital deficiency of $146,165 and an
       accumulated deficit of $25,023,759 at June 30, 2002. These circumstances
       raise substantial doubt as to the Company's ability to continue as a
       going concern.

                                       9
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

       The Company's ability to continue as a going concern is dependent on the
       Company's ability to raise additional capital, and implement its business
       plan. Management believes that actions presently taken to obtain
       additional funding provide the opportunity for the Company to continue as
       a going concern. The condensed consolidated financial statements do not
       include any adjustments that might result from the outcome of this
       uncertainty.

NOTE 2 FURNITURE, FIXTURES AND EQUIPMENT
------ ---------------------------------

       The furniture, fixtures and equipment were acquired with the acquisition
       of the assets of SyntheSys on January 7, 2002. During the six months
       ended June 30, 2002 the Company has acquired additional computer hardware
       and software of approximately $197,000 to increase the infrastructure of
       its information technology support and development capabilities.
<TABLE>
<CAPTION>
       Furniture, fixtures and equipment at June 30, 2002 consists of the
       following:
<S>                                                               <C>
       Furniture and fixtures                                     $      11,028
       Computer hardware                                                 73,871
       Computer software                                                144,932
       Equipment                                                         20,073
                                                                 --------------
                                                                        249,904
       Less: accumulated depreciation                                   (59,232)
                                                                 --------------
                                                                  $     190,672
                                                                 ==============
</TABLE>
NOTE 3 LOANS FROM RELATED PARTY
------ ------------------------

       In February 2002, the Company received a loan from a related party, in
       the amount of $375,000. The loan is due in 90 days and has a 10% interest
       rate. The maturity date has been extended by 90 days. At June 30, 2002
       there was $375,000 outstanding on the loan. The Company incurred
       consulting fees related to the loan (See Note 4(B)).

       In March 2002, the Company received an additional short-term loan from
       the same related party, in the amount of $125,000. This loan was repaid
       in full in April 2002.


                                       10
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)

NOTE 4 STOCKHOLDERS' EQUITY
------ --------------------

       2002
       ----

       (A) Common Stock to be Issued
       -----------------------------

       In January 2002, the Company acquired 100% of the common stock of
       Synthesys. In connection with the purchase, the Company was to issue
       5,350,259 shares of restricted common stock valued at $19,581,948. The
       shares were valued at the average quoted trading price during the
       acquisition period. These shares were issued in August 2002.

       During March, April and June 2002 the Company received an aggregate of
       $2,150,000 in cash from a stockholder. The Company is obligated to issue
       an aggregate of 10,400,000 shares of common stock for the cash received
       and 100,000 shares of common stock valued at $5,000 for consulting
       services related to these transactions.

       (B) Issuance of Common Stock for Services
       -----------------------------------------

       In February 2002 the Company issued 75,000 shares of common stock to
       related parties valued at $3,750 in payment of consulting fees incurred
       as a result of the completion of a loan to the Company (See Note 3).

       (C) Issuance of Common Stock for Cash
       -------------------------------------

       In February 2002 the Company issued 6,000,000 shares of common stock for
       $300,000, according to a Term Sheet dated February 8, 2002. The Company
       also incurred consulting fees related to the issuance of this stock, and
       issued 100,000 additional shares of common stock in payment of these
       expenses valued at $5,000.

       (D) Exercise of Common Stock Warrants
       -------------------------------------

       In May 2002 the Company issued 1,970,000 shares of common stock for two
       1,000,000 warrants in a cash-less exercise option of those warrants with
       an exercise prices of $.035 and $.05 per share.





                                       11
<PAGE>
                             AUG Corp. and Subsidary
              Notes to Condensed Consolidated Financial Statements
                               As of June 30, 2002
                                   (UNAUDITED)
                                   -----------

       2001
       ----

       In February 2001, 15,778,406 common shares were retired and replaced by
       3,944,602 common shares according to the 4:1 reverse stock split approved
       by the Board of Directors.

       In September 2001, the Board of Directors and a majority of the
       shareholders of the Company voted to effectuate a 100:1 reverse stock
       split of the Company's currently issued and outstanding shares of common
       stock. The reverse stock split became effective on October 29, 2001.

       All shares and per share amounts have been restated to reflect these
       transactions.

       (A) Issuance of Common Stock for Debt
       -------------------------------------

       On June 30, 2001, 65,743 shares of common stock were issued for the
       settlement of debt. The shares were valued at $2,200 using the fair value
       as determined by an independent appraiser. This resulted in an
       extraordinary gain of $1,665,043.

       (B) Conversion of Outstanding Preferred Stock
       ---------------------------------------------

       On June 30, 2001, the Company converted the 1,416,700 shares of preferred
       stock outstanding to 1,209,678 shares of common stock.

NOTE 5 LITIGATION
------ ----------

       An action was brought against the Company's subsidiary, Synthesys, prior
       to the acquisition by AUG Corp., by an investment banker, alleging breach
       of an investment-banking contract. This lawsuit was settled in May 2002
       by a confidential agreement between the parties that resulted in no
       change to the Company's condensed consolidated financial position,
       results of operations or cash flows.

NOTE 6 SUBSEQUENT EVENTS
------ -----------------

       In July 2002, the Company incorporated Biometrics Marketing, Inc., a
       related company to perform marketing, sales and administrative functions.

       In July 2002 the Company issued 200,000 shares of common stock for
       $300,000, according to a Term Sheet dated July 16, 2002.


                                       12
<PAGE>
Item 2.  Management Discussion and Analysis

General

         Management's discussion and analysis contains various forward-looking
statements within the meaning of the Securities and Exchange Act of 1934. These
statements consist of any statement other than a recitation of historical fact
and can be identified by the use of forward looking terminology such as "may,"
"expect," "anticipate," "estimates" or "continue" or use of negative or other
variations of comparable terminology. Management cautions that these statements
are further qualified by important factors that could cause actual results to
differ materially from those contained in forward looking statements, that these
forward looking statements are necessarily speculative, and there are certain
risks and uncertainties that could cause actual events or results to differ
materially from those referred to in forward looking statements.

Overview

         On January 7, 2002, the Company and its wholly owned subsidiary, AUG
Acquisition Corp. ("AAC"), entered into an Agreement and Plan of Merger, dated
December 28, 2001 with SyntheSys Secure Technologies, Inc. ("Synthesys"). The
Merger Agreement provided that upon the terms and subject to conditions therein,
for the merger of AAC into Synthesys. Synthesys and AAC made the appropriate
filings to complete the Merger Agreement with the State of Florida on January 7,
2002, and SyntheSys became a wholly owned subsidiary of the Company. The Company
paid $600,000 cash and the shareholders of Synthesys received an aggregate of
5,350,259 shares of the Company's Common Stock in exchange for their interest in
Synthesys.

         Synthesys, a Florida corporation, with its executive offices located in
Deerfield Beach, Florida, is a global secure solutions company that intends to
develop and market a variety of innovative security-based products that function
on multiple operating systems including Open VMS(TM), UNIX(TM), Linux(TM),
Windows NT(TM), Windows 2000(TM) and AS400(TM).

         SyntheSys was incorporated in May 2001 under the name SyntheSys
Technologies, Inc. Its name was subsequently changed to SyntheSys Secure
Technologies, Inc.

         Synthesis's operations are reflected in the results of operations for
the three month and six month period ended June 30, 2002 from the date of
acquisition. The results of operations for the quarter and six months ended June
2001 only reflect the Company's operations since SyntheSys was not incorporated
until May 2001. Since SyntheSys was not incorporated until May 2001, the
proforma effect for the three and six months ended June 30, 2001 is
insignificant.

                                       13
<PAGE>
Results of Operations for the Three Months ending June 30, 2002 and 2001

         The Company recognized revenues of $ 33,100 for the quarter ended June
30, 2002. For the corresponding period of 2001 the Company did not recognize any
revenues. The Company's sales efforts are focused on continuing to market its'
biometric software and technical service products.

         The Company incurred $1,195,175 of operating expenses for the quarter
ended June 30, 2002. These expenses were primarily incurred in the continued
development and enhancement of the Company's biometric software products, in
addition to marketing and sales of the biometric products. The Company has also
incurred $388,107 of professional fees. Operating expenses for the quarter ended
June 30, 2001 were $9,100. These expenses were primarily start up expenses.

         The Company incurred a net loss for the quarter ended June 30, 2002 of
$ 1,550,182. For the quarter ended June 30, 2001 the Company had a net loss of
$9,100.

Results of Operations for the Six Months ending June 30, 2002 and 2001

         The Company had revenues of $34,990 for the six months ended June 30,
2002. For the corresponding period of 2001 the Company did not recognize any
revenues.

         The Company incurred $2,687,535 of operating expenses for the six
months ended June 30, 2002. Expenses increased during the six months ended June
30, 2002; as the Company increased sales and marketing activities, in addition
to strengthen its personnel in both software development and finance. Operating
expenses for the six months ended June 30, 2001 was $20,543. These expenses were
primarily incurred in the start-up of the Company.

         During the six months ended June 30, 2001, 65,743 shares valued at $
658 were issued for the extinguishment of debt consisting of notes and interest
valued at $1,665,701. A gain on extinguishment of debt was recognized for
$1,665,043.

Liquidity and Capital Resources

       The Company's condensed consolidated financial statements have been
presented on the basis that it is a going concern, which contemplates the
realization of assets and the satisfaction of liabilities in the normal course
of business. For the six months ended June 30, 2002, the Company has a net loss
of $2,652,545 and a negative cash flow from operations of $2,461,838, and has a
working capital deficiency of $146,165 and an accumulated deficit of $25,023,759
at June 30, 2002. These circumstances raise substantial doubt as to the
Company's ability to continue as a going concern. The Company's ability to
continue as a going concern is dependent on the Company's ability to raise
additional capital, and implement its business plan. The Company has obtained
short term financing and equity funding through the issuance of restricted
common stock and related party loans.

         In February 2002, the Company received a loan from a related party, in
the amount of $375,000. The loan is due in 90 days and has a 10% interest rate.
The maturity date has been extended by 90 days. At June 30, 2002 there was
$375,000 outstanding on the loan. The Company issued 75,000 shares of common
stock to related parties valued at $3,750 in payment of consulting fees incurred
as a result of the completion of the loan to the Company.

       In March 2002, the Company received an additional short-term loan from
the same related party, in the amount of $125,000. This loan was repaid in full
in April 2002.

                                       14
<PAGE>
PART II. OTHER INFORMATION
         -----------------

Item 1.  Legal Proceedings

         During the first quarter 2002 HD Brous & Co., Inc. filed an action in
the United States District Court for the Eastern District of New York against
the C. (HD Brous & Co., Inc. vs. Synthesys Secure Technologies, Inc. a/k/a
Synthesys Technologies, Inc., case # CV 02 910). By its Complaint, Brous alleged
that it Company's subsidiary, SyntheSys Secure Technologies, Inc performed
investment banking services for Synthesys and is entitled to be compensated. The
complaint was confidentially settled in early May 2002.

         On May 10 2002, Information Transport Associates, Inc, Inc. filed an
action in the United States District Court in the Fifteenth Judicial Circuit of
Florida against the Company's subsidiary, Synthesys, Case No. 02-05130AH. By its
complaint, ITA alleges that it performed business, technical services for
Synthesys and is entitled to be compensated. Synthesys denied the allegations of
the complaint. The Company intends to defend this complaint. As of the date of
this report the Company cannot opine as to its potential outcome.

Item 2.  Changes in Securities and Use of Proceeds

         In January 2002, the Company acquired 100% of the common stock of
Synthesys. In connection with the purchase, the Company was to issue 5,350,259
shares of restricted common stock valued at $19,581,948. The shares were valued
at the average quoted trading price during the acquisition period. These shares
were issued in August 2002.

         In February 2002 the Company issued 75,000 shares of common stock to
related parties valued at $3,750 in payment of consulting fees incurred as a
result of the completion of a loan to the Company. In addition the Company
issued 6,000,000 shares of common stock for $300,000, according to a Term Sheet
dated February 8, 2002. The Company also incurred consulting fees related to the
issuance of this stock, and issued 100,000 additional shares of common stock in
payment of these expenses valued at $5,000.

         During March, April and June 2002 the Company received an aggregate of
$2,150,000 in cash from a stockholder. The Company is obligated to issue an
aggregate of 10,400,000 shares of common stock for the cash received and 100,000
shares of common stock valued at $5,000 for consulting services related to these
transactions.

         In May 2002 the Company issued 1,970,000 shares of common stock
pursuant to the exercise of two warrants with cash-less exercise provisions. The
options had exercise prices of $.035 and $.05 per share.


                                       15
<PAGE>
         The securities issued in connection with the transactions above were
issued under the exemption from registration provided by Section 4(2) of the
Securities Act. The shareholders received information concerning the Company and
had the opportunity to ask questions about the Company. The securities issued
are marked with the appropriate restrictive legends.

Item 3.  Defaults Upon Senior Securities

         None.

Item 4.  Submission of Matters to a Vote of Security Holders

         None.

Item 5.  Other Information

         None.

Item 6.  Exhibits and Reports on Form 8-K

         (a)      Exhibits required by Item 601 of Regulation S-B

         The following exhibits are filed as part of this report:

         Exhibits:

         2.1      Agreement and Plan of Merger, dated December 28, 2001 with
                  SyntheSys Secure Technologies, Inc. (previously filed on Form
                  8-K filed February 12, 2002).

         99.1     Certification of Chief Executive Officer

         99.2     Certification of Principal Accounting Officer

         (b)      Reports on Form 8-K

         None.




                                       16

<PAGE>
                                   SIGNATURE


         Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned as duly authorized officers of the Registrant.





                                            AUG CORP

                                            By: /s/ Laurence S. Isaacson
                                                -------------------------------
                                                Laurence S. Isaacson, President


DATED: August 18, 2002


























                                       17