Settlements

CAPRICORN COMMUNICATIONS CORP., et. al. [Sec. 161 & Settlement Agrmt.]

BCSECCOM #:
2001 BCSECCOM 253, 2001 BCSECCOM 254
Document Type:
Sec. 161 & Settlement Agrmt.
Published Date:
2001-02-28
Effective Date:
2001-02-22
Details:


2001 BCSECCOM 253


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

AND

IN THE MATTER OF CAPRICORN COMMUNICATIONS CORP.

AND

IN THE MATTER OF RICHARD FENNER

Order Under Section 161


[para 1]
1. WHEREAS a Settlement Agreement was executed by Richard Fenner (“Fenner”), Capricorn Communications Corp. (“Capricorn”) and the Executive Director, a copy of which is attached hereto as "Schedule A".

[para 2]
2. NOW THEREFORE, the Executive Director, considering that it would be in the public interest to do so, orders BY CONSENT, that:

2.1 pursuant to section 161(1)(c) of the Securities Act, R.S.B.C. 1996, c. 418 (the "Act"), none of the exemptions described in sections 44 to 47, 74, 75, 98 or 99 of the Act apply to Fenner either directly, or indirectly through another person, company, or trust acting on his behalf, until six months after the date of the Settlement Agreement;

2.2 pursuant to section 161(1)(d) of the Act, Fenner is prohibited from engaging in investor relations activities in British Columbia until six months after the date of the Settlement Agreement; and

2.3 pursuant to section 161(1)(d) of the Act, Fenner will resign forthwith from any position that he holds as a director or officer of any issuer in British Columbia and is prohibited from becoming or acting as a director or officer of any issuer in British Columbia, until Fenner successfully completes a course of study satisfactory to the Executive Director concerning the duties and responsibilities of directors and officers.

[para 3]
DATED at Vancouver, British Columbia, on February 22, 2001.




Steve Wilson
Executive Director


2001 BCSECCOM 254



SCHEDULE “A”
IN THE MATTER OF THE SECURITIES ACT
R.S.B.C. 1996, c. 418

AND

IN THE MATTER OF CAPRICORN COMMUNICATIONS CORP.

AND

IN THE MATTER OF RICHARD FENNER


Settlement Agreement

[para 1]
1. The following settlement of issues has been reached between Capricorn Communications Corp. (“Capricorn”), Richard Fenner (“Fenner”) and the Executive Director.

Agreed Statement of Facts

[para 2]
2. As the basis for the orders and undertakings referred to below, Capricorn and Fenner acknowledge the following facts as correct:

2.1 Capricorn is incorporated under the Company Act, R.S.B.C. 1996, c. 62;

2.2 Capricorn is not a reporting issuer under the Securities Act, R.S.B.C. 1996, c. 418 (the “Act”);

2.3 Fenner is a director of Capricorn, and resides in British Columbia;

2.4 Fenner is not currently and has never been registered in any capacity under the Act;

2.5 during the period from on or about the summer of 1996 to February 1997 (the “Relevant Period”), Capricorn and Fenner distributed the securities of Capricorn. The distributions were made without registration, without filing or obtaining a receipt for a prospectus, and without an applicable exemption from the registration and prospectus requirements of the Act, contrary to sections 34(1) and 61(1) of the Act;

2.6 during the Relevant Period, Fenner made representations, while engaging in investor relations activities or with the intention of effecting a trade, that the securities of Capricorn would be repurchased at a future date if they did not reach a particular value, contrary to section 50(1)(a) of the Act;

2.7 during the Relevant Period, Fenner made further representations, while engaging in investor relations activities or with the intention of effecting a trade, that the securities of Capricorn would be listed and posted for trading on an exchange or that an application would be made to list and post the securities of Capricorn for trading on an exchange, contrary to section 50(1)(c) of the Act;

2.8 Fenner represents that he and Capricorn obtained the advice of British Columbia legal counsel prior to engaging in the activities described in paragraphs 2.5, 2.6 and 2.7 of this Settlement Agreement; and

2.9 Fenner has co-operated with Commission Staff.

Undertakings

[para 3]
3.1 Fenner undertakes to offer each and every investor in Capricorn a right of rescission with respect to the distributions made by Capricorn and Fenner (the “Rescission Offer”) on the following conditions:

3.1.1 Fenner shall deliver a plan of rescission (the “Rescission Plan”) to Commission staff providing the details of Rescission Offer, acceptable to Commission Staff, prior to making the Rescission Offer;

3.1.2 Fenner shall deliver to each investor a copy of this settlement agreement along with a letter approved by Commission Staff setting out an offer to rescind that investor’s investment and to receive a full refund of the amount paid, and stating that the offer of rescission shall remain in effect for a period of thirty days from the date the letter is received;
    3.1.3 Fenner shall deliver the Rescission Plan and complete the Rescission Offer within eighteen months of the date of the Order referred to in section 4 herein; and
      3.1.4 if Fenner requires an extension of the time for the delivery of the Rescission Plan and completion of the Rescission Offer, an application may be made to the Commission no later than fourteen months after the date of this agreement.

      3.2 Fenner undertakes to pay the Commission the sum of $2,000, of which $1,000 represents the costs to the Commission of the investigation. The payments shall be made in accordance with the following schedule:

      3.2.1 the $2,000 will be payable six months from the day the Rescission Offer is made; and

      3.2.2 on the terms set out in the Promissory Note executed by Fenner in favour of the Commission.

      3.3 Capricorn and Fenner undertake to comply fully with all the provisions of the Act and the Rules from the date of this agreement.

      Order

      [para 4]
      4. Fenner, consents to an order by the Executive Director (the “Order”) that:

      4.1 under section 161(1)(c) of the Act, none of the exemptions described in sections 44 to 47, 74, 75, 98 and 99 of the Act apply to Fenner either directly, or indirectly through another person, company, or trust acting on his behalf, until six months after the date of the Order;
        4.2 under section 161(1)(d) of the Act, Fenner is prohibited from engaging in investor relations activities in British Columbia until six months after the date of the Order;


        4.3 under section 161(1)(d) of the Act, Fenner will resign forthwith from any position that he holds as a director or officer of any issuer in British Columbia and is prohibited from becoming or acting as a director or officer of any issuer in British Columbia, until Fenner successfully completes a course of study satisfactory to the Executive Director concerning the duties and responsibilities of directors and officers; and

        4.4 Capricorn and Fenner waive any right 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.


        DATED at Vancouver, British Columbia, on February 21, 2001.




        “Richard Fenner”
        Richard Fenner



        “L. Herlin” )
        Witness Signature )
        )
        Lorne Herlin )
        Witness Name (please print) )
        )
        701 West Georgia Street )
        )
        Vancouver, BC )
        Address )
        )
        Lawyer )
        Occupation )



        DATED at Vancouver, British Columbia, on February 21, 2001.

        Authorized Signatory for:


        “Richard Fenner”
        Capricorn Communications Corp.



        “L. Herlin” )
        Witness Signature )
        )
        Lorne Herlin )
        Witness Name (please print) )
        )
        701 West Georgia Street )
        )
        Vancouver, BC )
        Address )
        )
        Lawyer )
        Occupation )



        DATED at Vancouver, British Columbia, on February 21st , 2001.





        Steve Wilson
        Executive Director