Algae Dynamics Litigation and Investigations

Since 2013, NoHedge has assisted investors to navigate U.S. Traded Canadian company
space (OTCBB) that has proven to be full of companies actively engaged in deceiving
investors. As investors read our expos on Algae Dynamics (formerly Carbon Converted
Technologies) today they need to realize that our due diligence process employed similar
tools, such as background checks, court records, transcripts, and SEDAR and EDGAR filing
analysis that led to the halt and trading of numerous frauds. Today's report on Algae
Dynamics combines these approaches and allows us to make our strongest impact of fraud
to date: limit public investor losses before it can trade. The choice investors are left to make
is very simple: Do I buy Algae Dynamics and wait for the rhetoric that its management and
its fee collectors will spout or do I sell out prior to what we believe is the inevitable
bankruptcy, trusting in our due diligence and track record? The choice is yours and yours
alone to make. We have made ours.
Three months ago we released an expos about Algae Dynamics, a Canadian company
looking to go public in the United States. These report can be viewed by clicking on either
Algae Dynamics: A Questionable IPO or part II, Algae Dynamics: IPO Update from Bad to
Worse. Today's update on Algae Dynamics is based on a 10K recently filed by Algae
Dynamics with numerous material omissions.
Summary Highlights
1.

10K filed for 2015 is a disaster and tells a story That Algae Dynamics is out of cash
after burning another $1,00,000.
2.
$3,000 in cash remaining
3.
$1.8 million in losses in the past two years.
4.
No revenue, sales or operations. No production.
5.
$450,000+ in professional fees relating to securities regulator investigations and
requests.
6.
Legacy Cymat Annual Statements proving a long history of poor management are
now online here: 1999 Annual Report.
7.
Cymat 2002 Annual Report about Mr Rusiniak & Mr Ramsay
8.
Sandra Elsleys employment is terminated, she was Algae Dynamics former financer
and stock promoter in charge of illegal capital raises in Ontario.
9.
10K omits all information and exhibits relating to illegal financial raises and material
agreements related to the financer, Sandra Elsley.
10.
S1 investors can't sell their shares: they are worthless.
11.
Algae Dynamics is prohibited from trading on any exchange.

ALGAE DYNAMICS RED FLAGS - UPDATED July 17, 2015

1.

From the recent 10K (page 27) Algae Dynamics states: There is no assurance that
we will ever obtain a trading symbol from FINRA. Therefore, a shareholder may be unable to
resell securities in our company.

2.

Algae Dynamics is controlled by former founders and management of Cymat

Technologies (TSX: CYM), who ran the company into the ground for over $13,000,000 ($13
million) in accumulated losses by 2002. Over 4 years, they decreased annual sales of less
than $300,000 per year to $0 in 2002 when Mr Ramsay and Mr Rusiniak were retired from
Cymat. Click for the 2002 Cymat Annual statement
3.
Algae Dynamics cited bankrupt companies as competitors in their S1 filing. The SEC
asks the company on page 8 comment 35, why the company Solazyme Roquette

Nutritionals dissolved in June 2013 was listed with a EBITDA multiple.

4.

In the final year of employment at Cymat, two Algae Dynamics Directors lost $7
million in just one year before their employment was terminated.
5.
86% of Algae Dynamics is owned by insiders who paid a total of $100 for all of their
shares.
6.
Like Cymat, Richard Rusiniak, Paul Ramsay, and Sandra Elsley bilked investors for
$1.8 million over the last two years and the company has $7,000 $3,000 in cash left.
7.
No registration, offering, prospectus or exemptions are filed for Converted
Carbon Technologies or Algae Dynamics with the Ontario Securities Commission.
8.
No revenue, product or profit.
9.
Since our report, Algae Dynamics modified their web site to show that one junior staf
position is now filled, in any attempt to make the company look as though some money is
being used within the company's operations rather than leaving the company to its Officers
and Directors personal bank accounts.
10.
In 2014, a year total of $29,000 was spent in Research and Development - hardly
substantial R&D into new technology. $514 was spent in 2013 according to the latest 10Q.
The Company exhausted $1.8 million during that period. In total as per 10K (page 30) , By
initiating this process extra research and development fees ($43,222), facility occupancy
costs ($26,634) were incurred.
11.
No independent technology review.
12.
Management has been paid most of the money raised.
13.
Capital raised and grants exceeding $2.7M - most of which is accounted for as
"expenses" as of 10K. However, the company has not included a total loss to date from
inception.
14.
There are no employees or operations in the United States.
15.
Money is not spent on technology.
16.
No money to sustain operations or build a plant.
17.
Nominal equipment : $67,000 (as per Dec 2014 10Q), despite millions being raised.
18.
There are no operations, their focus is on shares sales and future share price.
19.
Ofering documents spammed by Sandra Elsley to unsophisticated investors in 2013
and 2014 state future value at $250 million; however, the registration S1 statement and
recent 10K proves no revenue, assets or profit.
20.
Algae Dynamics is was primarily funded by a Sandra Elsley's small group of
unsophisticated Ontario-based investors. An illegal raise per Ontario Securities Commission
rules.
21.
The company has pushed for accelerated registration despite serious operating
concerns and material omissions.
22.
No Canadian listing sought.

23.

Future securities litigation likely from regulators and Ontario investors relating to
the Company's prior private financing oferings managed by Sandra Elsley.
24.
Classic pump-and-dump statements from their investor relations/financier.
25.
Reverse split prior to S1, masking numerous prior raises at diferent prices.
26.
Algae Dynamics goes to a new low in boiler-room share sales: Hired a family therapist
to manipulate unsophisticated investors into parting with $1.8 million in retirement funds
with the promise of high returns and a pump and dump. Our last report covered the illegal
capital raises by Algae Dynamics.
27.
Engaged an external pump and dump group headed by stock promoter Gerard
Mooney.
28.
Sandra Elsley continues to raise money in Ontario, Canada from unsophisticated
investors for going public scams for US Markets.
29.
Algae Dynamics plans to seek Canadian Government grants for $2 million. This grant
service lists Sandra Elsley as a client for Grants Canada.
Algae Dynamics is engulfed in investigations and regulatory requests. They recently filed an
audited thin 10K proving still no revenue, sales, cash, prohibited from trading, and
no operations. A 10K is legally required to include the years audited financials, material
agreements, officer compensation, and any meaningful activity as reported in each 10Q. In
Algae Dynamics case, theyve purged all references and documentation relating to the
illegal financing by Sandra Elsley, the financial foundation and seed investors of this
company. A copy of our findings have been submitted to the Securities and Exchange
Commission as well as the Ontario Securities Commission.
The Companys 10K claims theyve spent $532,000 in professional fees to go public. Only
$41,000 was used for the audit (page 72 of 10K), most of the $490,000 is likely legal fees
incurred as a result of securities investigations and demands by authorities.
10K filed June 19, 2015 is full of omissions. For some background information on the
financing fraud see either Algae Dynamics: A Questionable IPO or part II, Algae Dynamics:
IPO Update from Bad to Worse . In summary, Algae Dynamics paid Sandra Elsley, a marriage
and family therapist, to manipulate unsophisticated, unaccredited investors into buying
shares in Algae Dynamics, based on false financial information authored by her and detailed
below. Her tasks included writing investor documentation, finding investors, convincing
therapy clients to invest, and manage investor communications. Since our Expos,
numerous potential investors have forwarded emails and documents to us soliciting
investment in Algae Dynamics (formerly Converted Carbon Technologies).
Click below for some of the documents purporting millions to unsuspecting investors:
1. Employment Agreement filed with SEC of Sandra Elsley
2. Algae Dynamics Proforma Investor Slide Show distributed by Sandra Elsley claiming high
profits and hundreds of millions in value
3. Algae Dynamics Business Plan provided to potential investors by Sandra Elsley and Paul
Ramsay

4. Algae Dynamics Opportunity Overview to potential investors by Paul Ramsay and Sandra
Elsley
5. Algae Dynamics Ofering Memorandum to potential investors by Sandra Elsley
6. Algae Dynamics subscription agreement illegal capital raise in Ontario by Sandra Elsley
7. Termination of Sandra Elsley filed with SEC in February 2015.

FINANCIAL HEALTH OF ALGAE DYNAMICS as of 10K

The financial condition of Algae Dynamics has never been worse: $3000 in the bank (page
35 of 10k). Its founders and financing officer are living in luxury from ill-gotten gains. Algae
Dynamics has no operations in the United States but is seeking to take hard-earned money
from unsophisticated investors in the US through false claims and fantasy pro formas
generated and distributed by Paul Ramsay and Sandra Elsley. Algae Officers burned through
1.8 million in two years.
Short Summary Just the Facts from the 10k:

Liabilities exceed $890,000

Net loss of past year is $1 million
Net loss of past two years is $1.8 million
Company fails to report total losses from inception
Still no filing with the Ontario Securities Commission as required by Law for the illegal
2013 and 2014 Ontario financings.
Algae Dynamics has $3,000 in cash remaining
No revenue
No explanation as to why the company is prohibited from trade on any stock
exchange
No further successful financing
No breakdown of payments made for illegal financing or shares and warrants
distributed for illegal finders fees.
No Regulation 506 detailing the S1 shareholders of June 6, 2014

This financial house of cards is falling down.

TROUBLING BACKGROUND OF THE FOUNDERS OF ALGAE DYNAMICS

(Paul Ramsay, Sandra Elsley, and Richard Rusiniak at Algae Dynamics)

Paul Ramsay, CEO and Chairman and Richard Rusiniak, Director
Management claims in their S1 that Paul Ramsay is "Co-founder and former CEO and VP
Business Development of Cymat Corp, (TSX: CYM) with a market valuation over $150 million
upon his resignation in 2002" and Mr Rusiniak's is similar.

Fact Check: We now have all Cymat Technologies Annual Reports online for detailed review.
Cymat Technologies 1998-2002 Annual Reports prove the executives ran the company into
the ground and the company lost over $13 million, no sales, and significant year-after-year
losses:

Year (source: annual

reports)

Net Profit

YTD accumulated
losses

1998

$490,000 loss

(omitted from AS)

1999

$1.4 million loss

(omitted from AS)

2000

$1.2 million loss

$3.13 million loss

2001

$2.9 million loss

$6 million loss

2002

2003

$7 million loss

$13 million loss

Reduced $2.3 million loss (Algae Dynamic Execs

no longer employed)

The inflated share value ($150 million) came from the Internet bubble. The stock became a
penny share with massive losses shortly thereafter. Yearly losses were cut significantly when
Algae Dynamics managements employment was terminated.
Mr. Ramsay's and Mr. Rusiniak's conduct in Algae Dynamics is very similar to the
performance of Cymat: Little revenue, no profit, massive losses, emphasis on stock sales.
Public Companies operated by Ramsay and Rusiniak have never made profit and investors
have always lost money.
Since receiving emails and documents from individuals solicited for investment, we learned
that Paul Ramsay would forward emails to Sandra Elsley between large companies and
himself. The discussions were impractical because Algae Dynamics has no production or
sales. Paul Ramsay would further salt the emails by advising Sandra Elsley that the
company was a large potential client. Sandra Elsley would then forward these emails to
unsuspecting investors in an attempt to manipulate an investment. This scheme was used to
push investors into believing large companies were interested in buying large volumes of
product when in fact they were not and no such production existed.

SANDRA ELSLEY, former VP Communications

Sandra Elsley S1 Biography (pg 35): "Over 25 years of experience in human relations and
the organizational development field as a communications and relationship expert, working
in government, corporate and private sectors. Extensive experience developing, marketing
and managing peak - performance programs to enhance individual and company dynamics
in Canada and internationally. Was involved in the start up of an Ontario based company,
was instrumental in raising funds and working as VP Corporate
Communications/Investor Relations - share price went from $0.50 to $7.70. Has
privately owned and managed a successful psychotherapy and consulting practice since
1991."
Fact Check: SEDAR and EDGAR do not reveal Sandra Elsley has ever worked for a public
company, much less one that had a share price that went from $0.50 to $7.70. There is one

public filing from a non-public company that states Sandra Elsley's employment with the
company was terminated with cause. Algae Dynamics, as well, filed a mutual release with
Sandra Elsley terminating her employment as the disastrous 10Q was filed, adding to Sandra
Elsley's lengthy list of failures.
There are numerous cons, lawsuits, judgments and court orders against Sandra Elsley in
Canadian, US, both in various courts.
A family therapist, Sandra Elsley, was an officer of Algae Dynamics titled as "VP Corporate
Communications" until a few weeks ago. According to a contract filed in the S1, in an
unusual role for a family therapist, Sandra Elsley's job was to manipulate money from her
therapy clients, write investment documentation, and handle investor communications. Most
disturbing is that Sandra Elsley convinces vulnerable therapy clients from her therapy
practice to invest into her penny stock promotions and schemes.
Pacer court records and other public court filings detail numerous prior and current
litigations over the past ten years involving Sandra Elsley detailing a history of fraud and
misrepresentations. A quick search of the names listed in the S1 reveal related numerous
litigations, including a transcript from a Nevada lawsuit naming Sandra Elsley as an
interested party. A transcript of Sandra Elsley's deposition demonstrates her reluctantly
admitting after first denying that at least one of the S1 investors is a mental health therapy
client of Sandra Elsley's and that Sandra Elsley borrowed significant money from her. Sandra
Elsley refused to disclose the amount she borrowed; however, she did state that she had not
repaid the loan. This raises a serious concern of Algae Dynamics "nominee shareholders"
whereby Directors and Officers of Algae Dynamics would benefit directly from an S1 investor
selling into the market if the company became public. These monies could be disguised as
loans to the insiders as they are in most OTCBB scams.
We have since located court rulings against Sandra Elsley on Canlii Law wherein the judge
presiding in ruling 2013 ONSC 1210, sanctions Sandra Elsley for numerous false statements
and directly comments "she actually stated in her affidavit was misleading at best and
untrue at worst." - just the kind of Communications VP any public company would want,
right?
In SPAM emails to new potential investors, Sandra Elsley claimed the Mr Ramsey and Mr
Rusiniak were "smart business men who made $50,000,000 Million about ten years ago and
retired" and she goes onto say they "Spent alot of money, got bored, and decided to find the
next best product to market." Sandra Elsley failed to disclose to investors material
information like the two men enjoyed high compensation, share sales to unsuspecting
investors, while driving Cymat to a $13,000,000 loss, never achieving a profit, and little to
no revenue in less than 5 years.
Sandra Elsley was compensated generously for her services at significant damage to her
vulnerable clients.
Since our Expos, numerous potential investors sent us copies of boiler-room investment
emails and attachments received from Sandra Elsley.
FOUNDERS ATTEMPT TO PURGE DAMNING INFORMATION FROM THE INTERNET

Well if you were hoping they would file accurate documents with the Ontario Securities
Commission then you guessed wrong. Instead of providing investors with accurate
information, their emphasis has been to purge Internet Search Engines of detailed proof of
litigation, false statements, and accurate reports. The founders have hired experts to purge
search engine results.
They have contacted Googles legal department, filed DCMA copyright notices for replicated
damning information, and hired experts to scrub documents and reports relating to Elsleys
prior numerous scams, and to remove our expos despite irrefutable proof.
The search engines have opted not to suppress the facts relating to the founders and Algae
Dynamics.

OFFERING DOCUMENTS AND PRIOR FINANCING RAISES

(click to enlarge)

(Figure 1 - financials used in prior financing rounds in 2014)

Fact Checking Highlights of Offering Materials vs. Financials in 2015 10K
False Claim

Offering Document

Actual from latest 1KQ

Revenue 2014

$5.5 million

$0 nothing

Gross Profit 2014

$3.6 million

$0 nothing

Plant Equipment 2014

$2.6 million

$70,000

Net earnings YTD

$2.5 million profit

In excess of $1.8 million lost

EBITDA (page 8 of document)

$247 million value

$0 profit x 15 = $0 value

Click below for ofering documents distributed to potential unsuspecting investors

Algae Dynamics Proforma Investor Slide Show distributed by Sandra Elsley claiming high
profits and hundreds of millions in value
Algae Dynamics Business Plan provided to potential investors by Sandra Elsley and Paul
Ramsay
Algae Dynamics Opportunity Overview to potential investors by Paul Ramsay and Sandra
Elsley
Algae Dynamics Ofering Memorandum to potential investors by Sandra Elsley
Algae Dynamics subscription agreement illegal capital raise in Ontario by Sandra Elsley

LIKELY RECISSION OF INVESTMENT BY ONTARIO INVESTORS

The Ontario Securities Commission overseas investment and market regulation much like
the Securities and Exchange Commission in the United States does. Ontario's RIGHTS OF
ACTION FOR DAMAGES OR RESCISSION mean shareholders who purchased shares in
Ontario can demand a refund or file an action against the company and individual who sold
them the shares illegally or by misrepresenting facts. Due to the statute of limitations, we
expect the Ontario S1 investors will soon commence actions against Algae Dynamics and
the Officer who handled their share purchase to recover their money. The Ontario Securities
Commission can be very helpful in this regard.
Boiler-room emails from IR blindly seeking fresh investors and press releases publicly
seeking investors will likely draw the intervention of the Ontario Securities Commission.
SECURITIES AND EXCHANGE COMMISSION STATUS
At this time, the SEC is not permitting Algae Dynamics to trade on any public stock

exchange. Future litigation and likely rescission of investment by Ontario investors will
pepper Algae Dynamic's filings for years to come.
In the unlikely event the company does go public, the only shares registered for sale are the
S1 investors - the company did NOT file a shelf registration to sell its own registered shares
in the future. If Algae Dynamics trades, the only shares available on the market would be
the S1 investors looking to exit as quickly as possible. It has not sought registration for any
of its treasury shares for future financing.
We view a bankruptcy as inevitable and would not be surprised if the SEC chooses to deny
its registration as a public company. Algae Dynamic does not even deserve to trade on the
Pink Sheets in our view.
We are pleased the Securities and Exchange Commission is protecting US investors by not
allowing Algae Dynamics to trade in public US Markets.
Please watch for our next expos on another Canadian Biotech IPO attempting to go public
in the United States, and in our opinion, exploit US investor money.
Disclosure: I will short Algae Dynamics if it is ever allowed to trade on any market. I wrote
this article myself, and it expresses my own opinions. I am not receiving compensation for
it. I have no business relationship with any company whose stock is mentioned in this
article.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate
any positions within the next 72 hours.