Settlements

BO GAS LIMITED, et. al. [Sec. 161 & Settlement Agrmt.]

BCSECCOM #:
Document Type:
Sec. 161 & Settlement Agrmt.
Published Date:
2000-07-07
Effective Date:
2000-06-28
Details:


IN THE MATTER OF THE SECURITIES ACT
R.S.B.C. 1996, c. 418

AND

IN THE MATTER OF BO GAS LIMITED
AND

IN THE MATTER OF JOHN CHATO

AND

JOHN THUOT

Order Under Section 161


1. WHEREAS a Settlement Agreement was executed by BO Gas Limited (the "Issuer"), John Chato ("Chato") and John Thuot ("Thuot") (the Issuer, Chato and Thuot being, collectively, the "Respondents") and the Executive Director, a copy of which is attached hereto as Schedule "A" (the "Agreement");

2. NOW THEREFORE the Executive Director, considering that it would be in the public interest to do so, orders, BY CONSENT (the "Order"), that:
      2.1. Pursuant to section 161(1)(c) of the Securities Act, R.S.B.C. 1996, c. 418 (the "Act"), the exemptions described in sections 44 to 47, 74, 75, 98 and 99 of the Act do not apply to the Issuer until the Order is revoked by the Executive Director, in accordance with subsection 2.3;

      2.2. Pursuant to section 161(1)(b) of the Act, Chato and Thuot cease trading in any securities, other that under section 45(7) of the Act and with the exception of securities in Clean Energy Combustion Systems, Inc., until the Order is revoked in writing by the Executive Director in accordance with subsection 2.3; and

      2.3. the Order may be revoked by the Executive Director upon application by any of the Respondents, after the Issuer has sent to each of the Purchasers:
          • a rescission offer in a form satisfactory to the Executive Director; and
          ·
          • a rescission offer circular and supplementary information in a form satisfactory to the Executive Director, which provides disclosure substantially equivalent to that required in Form 43 (offering memorandum).
          DATED at Vancouver, British Columbia, on June 28, 2000.





          Steve Wilson
          Executive Director




IN THE MATTER OF THE SECURITIES ACT
R.S.B.C. 1996, c. 418

AND

IN THE MATTER OF BO GAS LIMITED

and

IN THE MATTER OF

JOHN CHATO

AND

JOHN THUOT


Settlement Agreement


1. The following settlement of issues has been reached between Bo Gas Limited (the "Issuer"), John Chato ("Chato") and John Thuot ("Thuot") (the Issuer, Chato and Thuot being, collectively, the "Respondents") and the Executive Director.

Agreed Statement of Facts:

2. As the basis for the orders and undertakings referred to below, the Respondents acknowledge the following representations as correct:
      2.1 the Issuer was incorporated under the Company Act, R.S.B.C. 1979, c. 59 on December 13, 1991, has its head office in Burnaby, British Columbia, and is not a reporting issuer under the Securities Act, R.S.B.C. 1996, c. 418 (the "Act");

      2.2 Chato and Thuot are residents of British Columbia and have been the only directors and officers of the Issuer since its incorporation;

      2.3 the Issuer distributed, and Chato and Thuot caused the Issuer to distribute, 10,000,000 common shares (the "Shares") to a total of 141 persons, for total consideration of $864,451.02, during the period of December 1991 to September 1997;
      2.4 the Issuer distributed, and Chato and Thuot caused the Issuer to distribute, at least 1,292,378 of the Shares (the "Distributions") to at least 85 persons, including residents of British Columbia and other jurisdictions (the "Purchasers"), for total proceeds of $433,374.40, during the period March 1995 to September 1997;

      2.5 the Distributions were made in violation of sections 34 and 61 of the Act as:
              2.5.1. the Issuer was not registered to trade in British Columbia and did not file a prospectus under the Act in respect of the Distributions; and
              2.5.2. the Issuer could not rely on the exemptions from the registration and prospectus requirements under the Act or the Securities Rules, B.C. Reg. 194/97;
      2.6 the proceeds from the Distributions were used by the Issuer for bona fide corporate purposes;

      2.7 the Respondents have not traded in the securities of the Issuer since August 1998, when they brought this matter to the attention of staff of the British Columbia Securities Commission (the "Commission"), and have agreed not to trade in the securities of the Issuer until disclosure substantially equivalent to that required under Form 43 (offering memorandum) is delivered to the Purchasers with an offer of rescission;

      2.8 the Respondents, partially through a proposed offering of securities by Clean Energy Combustion Systems, Inc., are attempting to restructure the Issuer’s affairs to facilitate the Issuer making an offer of rescission to the Purchasers;

      2.9 the Respondents have co-operated fully with the staff of the Commission during the course of the investigation.

Order:

3. The Respondents consent to an order of the Executive Director (the "Order") as follows:
      3.1 pursuant to section 161(1)(c) of the Act, the exemptions described in sections 44 to 47, 74, 75, 98 and 99 of the Act do not apply to the Issuer until the Order is revoked in writing by the Executive Director, in accordance with subsection 3.3;

      3.2 pursuant to section 161(b) of the Act, Chato and Thuot cease trading in any securities, other than under section 45(7) of the Act and with the exception of securities in Clean Energy Combustion Systems, Inc., until the Order is revoked in writing by the Executive Director in accordance with subsection 3.3;

      3.3 the Order may be revoked by the Executive Director upon application by any of the Respondents, after the Issuer has sent to each of the Purchasers:
          • · a rescission offer in a form satisfactory to the Executive Director; and
          • · a rescission offer circular and supplementary information in a form satisfactory to the Executive Director, which provides disclosure substantially equivalent to that required in Form 43 (offering memorandum).
      Undertaking:
    4. The Respondents and the Issuer undertake to pay the sum of $10,000 to the Commission, $2,000 of which represents the costs of the investigation and the remainder of which will be a penalty.

    5. The Respondents waive the rights they may have, under the Act or otherwise, to a hearing, hearing and review, judicial review or appeal related to, in connection with, or incidental to this agreement and the Order.

    DATED at Vancouver, British Columbia, on June 23, 2000.


    _________________________________)
    Witness Signature )
    )
    _________________________________)
    Witness Name (Please Print) ) _________________________________
    ) BO Gas Limited
    _________________________________) (Signing Authority)
    Address )
    )
    _________________________________)
    Occupation )


    _________________________________)
    Witness Signature )
    )
    __________________________________)
    Witness Name (Please Print) )
                    ) _________________________________
    __________________________________) John Chato
    Address )
    )
    __________________________________)
    Occupation )

    _________________________________)
    Witness Signature )
    )
    _________________________________)
    Witness Name (Please Print) )
    ) _________________________________
    _________________________________) John Thuot
    Address )
    )
    _________________________________)
    Occupation

        DATED at Vancouver, British Columbia, on June 28, 2000.




    Steve Wilson
    Executive Director
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