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

                               AMENDMENT NO. 1 TO
                               ------------------

                                   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 March 31, 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: 104,780,223shares of Common
Stock as of November 20, 2002.



<PAGE>
<TABLE>
<CAPTION>
                                      INDEX
                                                                                  Page
                                                                                  ----

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

Item 1.  Condensed Financial Statements (unaudited)                                 3

         Balance Sheets                                                             3

         Statements of Operations                                                   4

         Statements of Cash Flows                                                   5

         Notes to Condensed Financial Statements                                    6-11

Item 2.  Management's Discussion and Analysis and Plan of Operations                12

PART II. OTHER INFORMATION                                                          14
         -----------------

Item 1.  Legal Proceedings                                                          14

Item 2.  Changes in Securities and Use of Proceeds                                  14

Item 3.  Defaults Upon Senior Securities                                            15

Item 4.  Submissions of Matters to a Vote of Security Holders                       15

Item 5.  Other Information                                                          15

Item 6.  Exhibits and Reports on Form 8-K                                           15
</TABLE>
















                                       2

<PAGE>
PART I.  FINANCIAL INFORMATION
         ---------------------

Item 1.  Condensed Financial Statements
<TABLE>
<CAPTION>
                            AUG CORP. AND SUBSIDIARY
                            CONDENSED BALANCE SHEETS
                            ------------------------


                                     ASSETS
                                     ------
                                                                         March 31, 2002
                                                                         (Consolidated)
                                                                          (Unaudited)     December 31, 2001
                                                                         --------------   -----------------
<S>                                                                       <C>                <C>
CURRENT ASSETS
 Cash and cash equivalents                                                $    273,351       $     36,079
 Cash advance for pending merger                                                    --            600,000
 Accounts receivable, net                                                        3,809                 --
 Prepaid expenses and other assets                                              57,640                 --
                                                                          ------------       ------------
       Total Current Assets                                                    334,800            636,079

Furniture, fixtures and equipment, net                                         207,834                 --

Goodwill                                                                    19,977,468                 --
                                                                          ------------       ------------

TOTAL ASSETS                                                              $ 20,520,102       $    636,079
------------                                                              ============       ============


                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

CURRENT LIABILITIES
 Accounts payable                                                         $    237,159       $         --
 Accrued expenses                                                               60,786              7,258
 Loans payable to related party                                                500,000                 --
                                                                          ------------       ------------
       Total Current Liabilities                                               797,945              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,
  88,364,964 and 82,189,964 shares issued and outstanding, respectively          8,836              8,220
 Common stock to be issued (11,470,259 shares)                              19,847,948                 --
 Additional paid-in capital                                                 23,169,948         22,887,815
 Accumulated deficit                                                       (23,304,575)       (22,267,214)
                                                                          ------------       ------------
       Total Stockholders' Equity                                           19,722,157            628,821
                                                                          ------------       ------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                $ 20,520,102       $    636,079
------------------------------------------                                ============       ============
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
                                        3

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


                                                                                      For the Three
                                                                                    Months Ended March   For the Three
                                                                                         31, 2002         Months Ended
                                                                                      (Consolidated)     March 31, 2001
                                                                                    ------------------   --------------
<S>                                                                                   <C>                  <C>
NET REVENUES                                                                          $         --         $         --
                                                                                      ------------         ------------

OPERATING EXPENSES
   General and administrative expenses                                                   1,024,361               11,443
                                                                                      ------------         ------------
       Total Operating Expenses                                                          1,024,361               11,443
                                                                                      ------------         ------------

LOSS BEFORE EXTRAORDINARY GAIN                                                          (1,024,361)             (11,443)

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

NET (LOSS) INCOME                                                                     $ (1,024,361)        $  1,653,600
-----------------                                                                     ============         ============

Net (loss) income per share of common stock - basic and diluted                       $      (0.01)        $      11.49
                                                                                      ============         ============
Weighted average number of shares outstanding during the period -
  basic and diluted                                                                     86,028,020              143,856
                                                                                      ============         ============
</TABLE>
     See accompanying notes to condensed consolidated financial statements.
                                        4


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



                                                                           For the Three
                                                                         Months Ended March       For the Three
                                                                              31, 2002          Months Ended March
                                                                           (Consolidated)            31, 2001
                                                                         ------------------     ------------------
<S>                                                                           <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net (Loss) Income                                                            $(1,024,361)          $ 1,653,600
 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                                                                   24,439                    --
 Changes in assets and liabilities:
  Accounts receivable                                                              (3,809)                   --
  Prepaid expenses and other current assets                                        26,850                    --
  Accounts payable                                                                138,079                    --
  Accrued expenses                                                                 42,976              (275,490)
                                                                              -----------           -----------
       Net Cash Used In Operating Activities                                     (782,076)             (286,933)
                                                                              -----------           -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
 Purchases of property and equipment                                             (190,086)                   --
 Cash acquired in merger acquisition                                              187,434                    --
                                                                              -----------           -----------
       Net Cash Used In Investing Activities                                       (2,652)                   --
                                                                              -----------           -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from the issuance of common stock, net                                  522,000                    --
 Note payable                                                                          --               270,000
 Loans payable to related party                                                   500,000                    --
                                                                              -----------           -----------
       Net Cash Provided By Financing Activities                                1,022,000               270,000
                                                                              -----------           -----------

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                  237,272               (16,933)

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

CASH AND CASH EQUIVALENTS - END OF PERIOD                                     $   273,351           $    12,239
-----------------------------------------                                     ===========           ===========
</TABLE>

SUPPLEMENTAL CASH FLOW INFORMATION:
-----------------------------------

Non-Cash Investing and Financing Activities:

During the three months ended March 31, 2002, 275,000 shares valued at $0.05 per
share were issued, or to be issued, for the payment of services valued at
$13,750.

During the three months ended March 31, 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.

     See accompanying notes to condensed consolidated financial statements.
                                        5

<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 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.

       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

                                       6
<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 2002
                              --------------------
                                   (UNAUDITED)

       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, Inc. 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., Inc.

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

       In preparing 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 financial statements and revenues and
       expenses during the reported period. Actual results could differ from
       those estimates.

                                       7
<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 2002
                              --------------------
                                   (UNAUDITED)

       (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 quarter ended March 31, 2001. The weighted average
       shares outstanding for the quarter ended March 31, 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 March 31, 2002 and
       for the three months ended March 31, 2002 and the condensed 2001
       financial statements of the parent company 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 months ended March 31, 2002
       (consolidated) and 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.

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

       Property 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.

                                       8
<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 2002
                              --------------------
                                   (UNAUDITED)

      (H) Going Concern
      -----------------

       The Company's condensed 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 three months ended March 31, 2002 the Company has a net
       loss of $1,024,361, a negative cash flow from operations of $782,076, and
       a working capital deficiency of $463,145 and accumulated deficit of
       $23,304,575 at March 31, 2002. These circumstances raise substantial
       doubt as to the Company's ability to continue as a going concern.

       The ability of the Company to continue as a going concern is dependent on
       the Company's ability to raise additional capital, and implement its
       business plan. The condensed 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.
<TABLE>
<CAPTION>
       Furniture, fixtures and equipment at March 31, 2002 consists of the
       following:
<S>                                                       <C>
       Furniture and fixtures                             $            11,027
       Computer hardware                                               61,662
       Computer software                                              133,198
       Equipment                                                       20,073
       Leasehold improvements                                          16,667
                                                          -------------------
                                                                      242,627
       Less: accumulated depreciation                                 (34,793)
                                                          -------------------
                                                          $           207,834
                                                          ===================
</TABLE>
NOTE 3 AFFILIATED PARTY TRANSACTIONS
------ -----------------------------

       The Company pays a licensed broker dealer corporation owned by the
       president, fees for all funds raised for the Company from parties
       introduced by the broker dealer. Fees associated with transactions
       resulting in the issuances of common stock are recorded as a reduction of
       additional paid-in capital (See Note 4(A) and (C)).

       In February 2002, the Company received a loan from an affiliated party in
       the amount of $375,000. The loan is due in 90 days and has a 10% interest
       rate. The maturity date can be extended by 90 days. At March 31, 2002
       there was $375,000 outstanding on the loan. The Company incurred
       consulting fees related to the loan (See Note 4(B)).

                                        9
<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 2002
                              --------------------
                                   (UNAUDITED)


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

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 subsequently issued in August 2002.

       In March 2002, the Company was to issue 6,020,000 shares of common stock
       for $261,000, net of direct costs of $39,000 to an affiliated party,
       according to a Term Sheet dated February 8, 2002. The shares were
       subsequently issued in July 2002 and at March 31, 2002, the shares are
       included in common stock to be issued in the accompanying condensed
       consolidated balance sheet. The Company also incurred consulting fees
       related to the issuance and was to issue 100,000 additional shares of
       common stock in payment of these expenses valued at $5,000. These shares
       were also subsequently issued in July 2002.

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

       In February 2002, the Company issued 75,000 shares of common stock to
       affiliated 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
       $261,000, net of direct costs of $39,000 to an affiliated party,
       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.

                                       10
<PAGE>
                            AUG CORP. AND SUBSIDIARY
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                              AS OF MARCH 31, 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 March 31, 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 March 31, 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 broker, 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 consolidated financial position, results of
       operations or cash flows.

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

       In April 2002 the Company issued 2,200,000 shares of common stock for
       $1,100,000, according to a Term Sheet dated April 11, 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 $25,000.


                                       11





<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, the surviving corporation, became a
wholly-owned subsidiary of the Company. Synthesys and AAC made the appropriate
filings to complete the Merger Agreement with the State of Florida on January 7,
2002.

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).

Management believes Synthesys' propriety software products position it to become
a leader in biometric crypto-controlling smart cards and secure systems
integration.

Synthesys was incorporated in May 2001 under the name SyntheSys Technologies,
Inc. Its name was subsequently changed to SyntheSys Secure Technologies, Inc.
SyntheSys is a development stage company.

Synthesys's operations are reflected in the results of operations for the three
month period ended March 31, 2002. As Synthesys was not incorporated until May
2001, results of operations for the three month period ended March 31, 2001 only
reflect the Company's historical operations.

Results of Operations for the Three Months ending March 31, 2002 and 2001

The Company had no revenues from operations for the quarter ended March 31, 2002
nor the quarter ended March 31, 2001. The Company's sales efforts are currently
focused on commercializing its' biometric and software products.

The Company incurred $1,024,361of general and administrative expenses for the
quarter ended March 31, 2002. These expenses were primarily incurred in the
research and development of biometric and software products and the marketing of
these products. The Company believes the research and development expenses will
decrease as the Company believes it is ready to commercialize its software and
biometric products. Operating expenses for the quarter ended March 31, 2002 were
$11,443. These expenses were primarily from administrative costs.

                                       12
<PAGE>
The Company incurred a net loss for the quarter ended March 31, 2002 of
$(1,024,361). For the quarter ended March 31, 2001 the Company had a net profit
of $1,653,600 due to a gain from the extinguishments of debt of $1,665,043.

Liquidity and Capital Resources

On March 31, 2002, cash and cash equivalents totaled $273,351.

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 three months ended March 31, 2002, the Company has a net loss of $1,024,361,
a negative cash flow from operations of $782,076, and a working capital
deficiency of $463,145 and accumulated deficit of $23,304,575 at March 31, 2002.
These circumstances raise substantial doubt as to the Company's ability to
continue as a going concern.

The ability of the Company 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 implement its business plan
and obtain additional funding provide the opportunity for the Company to
continue as a going concern.

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 an affiliated company in the amount of
$375,000. The loan is due in 90 days and has a 10% interest rate. The maturity
date can be extended by 90 days. At March 31, 2002 there was $375,000
outstanding on the loan.

In February 2002 the Company issued 6,000,000 shares of common stock to Lancer
Offshore, Inc. for $300,000, pursuant to a Term Sheet dated February 8, 2002.
The Company also issued 100,000 additional shares of common stock in payment of
consulting fees in connection with the transaction valued at $5,000.

In March 2002 the Company issued 6,000,000 shares of common stock to Lancer
Offshore, Inc. for $300,000 pursuant 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.

In March 2002 the Company received a short-term loan from an affiliated company
in the amount of $125,000. This loan was repaid in full in April 2002.

In April 2002 the Company issued 4,400,000 shares of common stock for
$1,100,000, to Lancer Offshore, Inc. pursuant to a Term Sheet dated April 11,
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 $25,000.









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<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 Company's
subsidiary, SyntheSys Secure Technologies, Inc. (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 performed investment banking
services for Synthesys and is entitled to be compensated. The complaint was
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 alleged that it performed business, technical services for
Synthesys and is entitled to be compensated. The complaint was settled in
September 2002 for $25,000.

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 received a loan from an affiliated 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 also issued 75,000 shares of common stock
to affiliated parties valued at $3,750 in payment of consulting fees incurred as
a result of the completion of the loan.

In February 2002, the Company issued 6,000,000 shares of common stock for
$261,000 net of direct costs of $39,000 to an affiliated party, 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 May 2002 the Company received an aggregate of $1,870,500
in cash from a stockholder, net of direct costs of $279,500 to an affiliated
party. The Company is obligated to issue an aggregate of 8,720,000 shares of
common stock for the cash received and 175,000 shares of common stock valued at
$42,500 for consulting services related to these transactions.

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<PAGE>
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.

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

In April 2002 the Company issued 4,400,000 shares of common stock for
$1,100,000, to Lancer Offshore, Inc. pursuant to a Term Sheet dated April 11,
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 $25,000.

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 Principal Executive Officer

         99.2     Certification of Principal Accounting Officer

         (b) Reports on Form 8-K

On February 12, 2002 the Company filed a Current Report on Form 8-K to disclose
that 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
for the merger of AAC into Synthesys. Synthesys, the surviving corporation,
became a wholly-owned subsidiary of the Company. Synthesys and AAC made the
appropriate filings to complete the Merger Agreement with the State of Florida
on January 7, 2002. Pursuant to the merger, Synthesys has become a wholly-owned
subsidiary of the Company.

On February 22, 2002 the Company filed a Current Report on Form 8-K disclosing
that HD Brous & Co., Inc. filed an action in the United States District Court
for the Eastern District of New York against the Company's subsidiary,
Synthesys. (HD Brous & Co., Inc. vs. Synthesys Secure Technologies, Inc. a/k/a
Synthesys Technologies, Inc., case # CV 02 910). The matter was subsequently
settled in May 2002.


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<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: December 4, 2002






























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