Settlements
Mark Stephen Heeres [Sec. 161 & Settlement Agrmnt]
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BCSECCOM #:
2005 BCSECCOM 394, 2005 BCSECCOM 395
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Document Type:
Sec. 161 & Settlement Agrmnt
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Published Date:
2005-06-09
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Effective Date:
2005-06-06
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Details:
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2005 BCSECCOM 394
2005 BCSECCOM 395
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2005 BCSECCOM 394
Order
Mark Stephen Heeres
Section 161 of the Securities Act, RSBC 1996, c. 418
Background
¶ 1 The Executive Director has entered into a Settlement Agreement with Mark Stephen Heeres (Heeres), a copy of which is attached as Schedule A.
The Order
¶ 2 The Executive Director, considering it to be in the public interest to do so, orders, by consent that:
1. under section 161(1)(a) of the Act, Heeres comply fully with the Act, the Securities Rules, and any applicable regulations, policies and guidelines;
2. under section 161(1)(b) of the Act, Heeres cease trading in and is prohibited from purchasing any securities for the later of 8 years from the date of this Order and the date Heeres has paid $2,500 to the Commission, except that Heeres may trade and purchase securities in one account held with a registered dealer to whom Heeres has first provided a copy of this Order;
3. under section 161(1)(d) of the Act, Heeres resign any position he holds as a director or officer of any issuer, and is prohibited from becoming or acting as a director or officer of any issuer, for the later of eight years from the date of this Order and the date Heeres has paid $2,500 to the Commission; and
4. under section 161(1)(d)(iii) of the Act, Heeres is prohibited from engaging in investor relations activities on behalf of any issuer for the later of eight years from the date of this Order and the date Heeres has paid $2,500 to the Commission.
¶ 3 June 6, 2005
¶ 4 Brenda M. Leong
Executive Director
Settlement Agreement
Mark Stephen Heeres
Section 161 of the Securities Act, RSBC 1996, c. 418
Statement of Facts
¶ 2 Heeres acknowledges the following facts as correct solely for securities regulatory purposes in British Columbia and elsewhere and as the basis for the undertakings and orders referred to in this settlement:
Background
Heeres
1. Heeres is a resident of British Columbia. He acted as an agent and, also, engaged in investor relations activities for 526053 B.C. Ltd. (526053). He has never been registered under the Act.
526053
2. 526053 is a company incorporated under the laws of British Columbia and is not a reporting issuer.
3. James Nelson McCarney is the sole shareholder, a director and an officer of 526053.
Heeres Distributed Securities
4. Between May 10, 1998 and December 31, 2002 (the Relevant Period), Heeres and others on behalf of 526053 promoted an investment in 526053 to residents of seven provinces, including British Columbia and Saskatchewan, as well as the United States, Germany, England, Costa Rica, Belize, Bahamas and Turks and Caicos Islands (the Investors).
5. Heeres and others encouraged Investors to enter into loan agreements with 526053 (the Loan Agreements). The Loan Agreements were represented as having the following material particulars:
(a) the funds provided by Investors were to be used for the development of Autolab’s business and to acquire a public company in the United States (Pubco);
(b) upon the acquisition of Pubco, the original investments in the Loan Agreements were to be repaid with Pubco securities, namely, shares and share purchase warrants; and
(c) depending on when the Loan Agreements were entered into, the Pubco shares were assigned a value that ranged from CAD $1.00 to USD $5.00 per share.
6. During the Relevant Period, Heeres and others on behalf of 526053 distributed and sold the Loan Agreements to approximately 1,435 investors, for total proceeds of approximately $26,637,512, with approximately $4,500,000 raised in British Columbia from 253 British Columbia residents.
7. In particular, during the Relevant Period, Heeres distributed and sold the Loan Agreements to:
(a) seven residents of British Columbia, raising approximately Cdn $100,000 (not including Heeres’ own family members);
(b) two residents of the United States, raising approximately Cdn $336,000; and
(c) two residents of Germany, raising approximately US $800,000.
8. Heeres received commissions in the approximate amount of $10,000 from 526053 for selling the Loan Agreements to British Columbia residents.
Mitigating Factor
¶ 3 The Executive Director has taken into account as a mitigating factor that Heeres does not have any reasonable prospect of being able to pay to the Commission the sanction amount of $30,000, which would otherwise be required in the public interest in respect of the misconduct described in this settlement.
Breaches of the Act
¶ 4 During the Relevant Period, Heeres breached the Act as follows:
1. Heeres:
(a) traded in Loan Agreements in British Columbia without being registered in accordance with the requirements of the Act, and without an exemption from the registration requirements of the Act, contrary to section 34(1)(a) of the Act; and
(b) distributed Loan Agreements in British Columbia without filing a prospectus and without any exemption from the prospectus requirements of the Act, contrary to section 61(1) of the Act.
Public Interest
¶ 5 Heeres acted contrary to the public interest by engaging in the conduct set out above.
Undertakings
¶ 6 Heeres undertakes:
2. to pay to the British Columbia Securities Commission the amount of $2,500; and
3. not to say anything, in writing or orally, which may contradict the terms of this settlement or call those terms into question.
Order
¶ 7 Heeres consents to an order by the Executive Director (the Order) that:
1. under section 161(1)(a) of the Act, Heeres comply fully with the Act, the Securities Rules, and any applicable regulations, policies and guidelines;
2. under section 161(1)(b) of the Act, Heeres ceases trading in and be prohibited from purchasing any securities for the later of 8 years from the date of the Order and the date Heeres has paid $2,500 to the Commission, except that Heeres may trade and purchase securities in one account held with a registered dealer to whom Heeres has first provided a copy of the Order;
3. under section 161(1)(d) of the Act, Heeres resign any position he holds as a director or officer of any issuer, and be prohibited from becoming or acting as a director or officer of any issuer, for the later of 8 years from the date of the Order and the date Heeres has paid $2,500 to the Commission; and
4. under section 161(1)(d)(iii) of the Act, Heeres be prohibited from engaging in investor relations activities on behalf of any issuer for the later of 8 years from the date of the Order and the date Heeres has paid $2,500 to the Commission.
Consent to Reciprocal Orders
¶ 8 Heeres consents to any securities regulator anywhere relying on the facts admitted in this settlement to make orders against him.
Waiver
¶ 9 Heeres waives any right he 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 settlement.
¶ 10 June 2, 2005
“Mark Heeres”
¶ 11 Mark Stephen Heeres
“Mike Pesunti: )
Witness Signature )
Mike Pesunti )
Witness Name (please print) )
701 W. Georgia St )
Vancouver BC )
Address )
Sr. Investigator )
Occupation
¶ 12 June 6, 2005
¶ 13 Brenda M. Leong
Executive Director