Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

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Thursday, September 10, 2009

Former Officers of Marshall Holdings Settle SEC Charges of Improper Form S-8 Registration

On September 4, 2009 the United States District Court for the Central District of California entered Final Judgments by consent against defendants Richard A. Bailey and Florian R. Ternes, residents of Las Vegas, Nevada and former officers and directors of Marshall Holdings International, Inc. (Marshall Holdings).  The SEC had previously alleged that Marshall Holdings, while under the control of Bailey and Ternes, improperly registered shares issued under employee stock option programs on Form S-8 registration statements from 2003 through 2005. Marshall Holdings then received at least 85% of the proceeds from the shares' sales as payment of the options' exercise price.

Without admitting or denying the complaint's allegations, Bailey and Ternes have consented to the entry of Final Judgments enjoining them from violating Section 5 of the Securities Act of 1933, ordering them to pay disgorgement of $341,001 and $259,000, respectively, plus prejudgment interest and, based upon their financial conditions, waiving payment of all such amounts. With this settlement, the action is fully resolved as to all defendants.

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