Ron Morgan at the Huntingdon, PA Daily News (New rail system could aid region) and Wayne Laepple at the Trains Newswire (Railcar repair shop opens on East Broad Top, August 11, 2014) are both reporting that Larry Salone has opened a railcar repair facility in Mount Union, PA.

The Trains Newswire article includes these two lines:

Trains does not distinguish between the non-profit East Broad Top Preservation Association and the "East Broad Top Railcar, LLC" that was created on 2/3/2011, according to the PA Department of State. I mention the two different entities because some RYPNers many not see how using the EBT's Mount Union yard for industrial development would be consistent with the EBTPA's stated objectives ("Our mission here at the East Broad Top Preservation Association is to preserve, maintain, and continue to improve the history of the East Broad Top Railroad.")

Both articles also mention the "PASS Box". Here is a very short (2-sentence long) fair-use quote of the Huntingdon News article, which is titled New rail system could aid region:

The Huntingdon News article also says that Synergy Natural Resources LLC claims that 100,000 PASS Boxes will be needed domestically and that Mr. Salone thinks Mount Union would be the perfect place for their manufacturing plant. As I read that, I found myself wondering why would an Atlanta-area company bother to consider building a plant in rural Pennsylvania? I quickly found the LLC's website , which includes a "Our Team" page that describes Mr. Drew J. Lofstad as company Co-Founder/Managing Member.

I then researched Mr. Lofstad and found some rather disconcerting information: there are multiple court records for a Mr. Drew J. Lofstad in both Georgia & Alabama, and the Atlanta (Fulton County) mugshot of a Drew Jason Lofstad is even posted online.

It also appears that news about the "PASS Box" was used to pump up the price of a penny stock in March 2013. Here's the relevant March 14, 2013 press release posted on Yahoo Finance... and here is that penny-stock's performance during the month -- you can see that it doubled in price immediately after that press release came out:

I'm not sure what to make of all this, but I doubt that any of it is good for the railroad.

(Post Edited on 8/14/2014 in order to correct link to The Huntingdon News article "New rail system could aid region".)

Lets hope they make it work out and make good on it, I would like to see something good work out for the Mount Union site, its been pretty stagnant.

I'm not about to go slinging dirt around, fix yer problems and get back in the right thick.

Chris,
Excellent job of due diligence.
GME

Chris,

I admire your passion for the preservation of the EBT and I respect the research you've done. However your statement,
implies that the purpose of the Press Release was to manipulate the stock price. Stock prices, penny and otherwise, move after the publication of news and press releases all the time. You would need more evidence to adequately support a charge of market manipulation than just the existence of a Press Release and subsequently seeing the stock price move.

Regards, Mark

OK, so there's an exploration about the possibility of creating a new business in Mount Union, which seems to me to be just the sort of thing that the people who live there might find useful. It's going to be set up in an existing historic structure built specifically for that purpose, railcar repair and construction. On the face of it, what's negative about this?

Digging deeper, it seems that some of the principals involved have potentially troublesome incidents in their backgrounds - OK, if this is the case, investors would choose carefully whether or not to risk their resources on plans made by these people, assuming you believe in the inherent rationality of a "free market", or that people make rational choices about risking their money.

So, what is the purpose: to warn us about the risk inherent in this business, in the principals involved, or what? Is the new hopper technology actually useful and likely to be an improvement on our current hopper car technology? Would this be a good idea if other principals were involved? Is Mount Union actually faced with far too many opportunities for gainful employment and has a shortage of unemployed workers?

dave

every business has risk. A container coal car I may not heard of before if it fits in current standards would work. Plus to do car repair gets the business going. There is no coal coming out, may as well try something else. Seems to me theres lots of people looking for work in this troubled economy.

If you get some business notched in, you might find new avenues, and even find a way EBT can be involved.

I think the concern being expressed here is that if this is a scam of some kind to defraud investors and it ends up destroying what's left of the EBT in Mt. Union, then it would be a horrible outcome for preservation. Maybe a little simplistic an explanation, but basically correct.

Good theory, but wrong results. The stock quotes you show are for a company called Double Crown Resources. They agreed to buy Synergy Natural Resources last year. That was when the stock price jumped. Since then Double Crown cancelled the deal and started promoting "Transprop", which amazingly looks just like PASS Box. Synergy is now suing Double Crown for uncompensated use of the PASS Box intellectual property. And Double Crown is suing Synergy back for business interference. Mr. Lofstad is still listed as being with Synergy, thus he did not benefit from the stock price jump. As an aside, it appears the people with Double Crown have been involved with a number of penny stock companies, none in any one specific industry.

The concept is certainly interesting - at least if it gets the Mt. Union area humming it is something positive, even if it isn't the EBT.

If you want to see what a PASS Box is: http://synergynr.com/pass-box/

and here is the Transprop: http://www.doublecrownresources.com/transprop.html

Looks awful similar, but at least Synergy has a patent pending.

Rich C.

No such "existing historic structure" remains in Mount Union. The ONLY EBT structure remaining intact in Mount Union, to the best of my recollection, is the standard gauge enginehouse, two single stalls wide. You could get one standard modern contemporary locomotive or freight car in there, at best--the other stall holds 0-6-0 #3 and tender.

Part of the worry? If this project proceeds as planned, it most likely means new buildings atop the "historic time capsule" property. As a comparable example, if someone wanted to build new car shops on, say, the B&O Museum's "First Mile" and bring industry to downtown Baltimore, disregarding whether or not "heavy industry" would be welcomed between very-low-income housing and a city park in a blighted city, it'd be like watching your worst enemy drive your new car off a cliff......

if you really wanted you could build new buildings getting that old classic look. But building codes and economics may say otherwise.

Andy Muller is living proof of that, see Port Clinton and Penobscot for evidence. Where there is a will there is a way.

Rob

One could ask why build a new railcar facility there when a modern one of great capacity was closed in Holidaysburg ?


Kevin K.

Best example, Age of Steam Roundhouse, Sugarcreek, OH.

When the March 14, 2013 press release came out, there was a flood of very similar posts about it on at least a dozen stock "tip" websites - websites with names like awesome stock tips, penny stock tweets, whisper from wall street, etc. Those posts were one reason why I suggested the news appeared to have been used to pump up the price of a penny stock.

Synergy Natural Resources seems to have cancelled the deal first, based upon the March 20, 2013 press release posted on their website. This quick cancellation was another reason why I suggested the news might have been used to pump up the penny stock's price.

Interesting - I had not seen that "Transprop", so thanks for pointing that out. Here is a Nov. 18, 2013 Press Release about the first lawsuit you mentioned.

There is also Pass Box, LLC et al v. Pass Box Partners, LLC et al filed on April 18, 2014.