FINRA

SEC SECTION 10(B) OF THE SECURITIES EXCHANGE ACT OF 1934 AND SEC RULE 10B-5, SEA SECTION 10(B) AND RULE 10B-9, FINRA RULES 2010, 2020, NASD RULE 3040: PEASLEE PARTICIPATED IN PRIVATE SECURITIES TRANSACTIONS BY SOLICITING INDIVIDUALS TO INVEST APPROXIMATELY $399,850 IN THE OFFERING. THE OFFERING'S PURPOSE WAS TO CAPITALIZE AN ENTITY THROUGH WHICH PEASLEE OPERATED HIS SECURITIES BUSINESS AND WHICH WAS WHOLLY OWNED BY PEASLEE. THE OFFERING PURPORTED TO BE ISSUED IN COMPLIANCE WITH RULE 506 OF REGULATION D OF THE SECURITIES ACT OF 1933 (REG. D), BUT NO REG D DOCUMENTS WERE FILED WITH THE SEC; PEASLEE RECEIVED NO WRITTEN REPRESENTATION FROM ANY OF THE INVESTORS THAT HE OR SHE MET THE REQUIREMENTS TO BE AN ACCREDITED INVESTOR; PEASLEE SOLD THE OFFERING TO INDIVIDUALS, SOME OF WHOM WERE CUSTOMERS OF HIS MEMBER FIRM. PEASLEE FAILED TO GIVE WRITTEN NOTICE OF HIS INTENT TO PARTICIPATE IN THE SALE OF THE OFFERING TO HIS FIRM, AND FAILED TO OBTAIN WRITTEN APPROVAL FROM HIS FIRM BEFORE ENGAGING IN SUCH ACTIVITIES; HIS FIRM DID NOT PERMIT REGISTERED REPRESENTATIVES TO PARTICIPATE IN THE SALE OF PRIVATE EQUITY OFFERINGS. WHILE REGISTERED THROUGH HIS FIRM, PEASLEE INTENTIONALLY OR RECKLESSLY, BY THE USE OF MEANS OR INSTRUMENTALITIES OF INTERSTATE COMMERCE, OR OF THE MAILS, EMPLOYED DEVICES TO DEFRAUD CUSTOMERS AND MADE UNTRUE STATEMENTS OF MATERIAL FACTS AND/OR OMITTED TO STATE MATERIAL FACTS NECESSARY TO MAKE THE STATEMENTS AND REPRESENTATIONS MADE BY PEASLEE, IN LIGHT OF THE CIRCUMSTANCES IN WHICH THEY WERE MADE, NOT MISLEADING, IN CONNECTION WITH INVESTOR'S INVESTMENT IN THE OFFERING. UNDER HIS SIGNATURE AS PRESIDENT AND MANAGER OF HIS BUSINESS ENTITY, PEASLEE PROVIDED THE INVESTORS WITH A PRIVATE PLACEMENT MEMORANDUM (PPM) AND SUBSCRIPTION AGREEMENT DOCUMENTS FOR THE OFFERING; THROUGH THE OFFERING DOCUMENTS, PEASLEE MADE MISREPRESENTATIONS AND OMISSIONS. IN RELIANCE ON PEASLEE'S MISREPRESENTATIONS, THE INVESTORS INVESTED IN THE OFFERING; THE INVESTORS HAVE NOT RECEIVED A SCHEDULED INTEREST PAYMENT SINCE AUGUST 2009. PEASLEE SOLD HIS BUSINESS ENTITY FOR $250,000 ON OCTOBER 1, 2009; ALTHOUGH THIS WAS A LIQUIDITY EVENT FOR HIS ENTITY UNDER THE TERMS OF THE PPM THAT SHOULD HAVE TRIGGERED PAYMENT TO THE INVESTORS, THEY RECEIVED NO PAYMENT FROM THESE FUNDS; INSTEAD, PEASLEE CONVINCED THE INVESTORS TO CONVERT THEIR EQUITY TO DEBT, ENTERING INTO PROMISSORY NOTES IN OCTOBER 2009 THAT PUSHED THE DATE OF REPAYMENT OUT UNTIL 2017 AND 2018; AS A RESULT OF SUCH CONDUCT, PEASLEE WILLFULLY VIOLATED SECTION 10(B) OF THE SECURITIES EXCHANGE ACT OF 1934 AND SEC RULE 10B-5. THE OFFERING SOLD BY PEASLEE WAS A CONTINGENT OFFERING INSOFAR AS IT REQUIRED THAT TEN PERCENT OF THE EQUITY BEING OFFERED BE SOLD IN ORDER FOR INVESTORS' FUNDS TO BE RELEASED TO THE ISSUER; THE OFFERING DOCUMENTS USED BY PEASLEE IN CONNECTION WITH THE OFFERING REPRESENTED THAT FUNDS RAISED IN THE OFFERING WOULD BE HELD IN AN ESCROW ACCOUNT AND RELEASED ONLY IF THE MINIMUM CONTINGENCY OF THE SALE OF TEN PERCENT OF THE COMPANY'S MEMBERSHIP INTEREST WAS SATISFIED. PEASLEE FAILED TO ESTABLISH AN ESCROW ACCOUNT IN THE NAME OF THE ISSUER, PEASLEE'S BUSINESS ENTITY, AND NO INVESTOR FUNDS FROM THE OFFERING WERE EVER HELD IN AN ESCROW ACCOUNT; RATHER, PEASLEE DEPOSITED INVESTOR FUNDS INTO THE ISSUER'S OPERATING ACCOUNT AND IMMEDIATELY BEGAN MAKING WITHDRAWALS. PEASLEE DISTRIBUTED INVESTOR FUNDS BEFORE THE MINIMUM CONTINGENCY WAS SATISFIED, THEREBY RENDERING THE REPRESENTATIONS IN THE OFFERING DOCUMENTS FALSE AND MISLEADING; AS A RESULT OF THIS CONDUCT, PEASLEE WILLFULLY VIOLATED SEA SECTION 10(B), RULE 10B-9.

Decision & Order of Offer of Settlement

Bar (Permanent)

All Capacities

10/13/2011

WITHOUT ADMITTING OR DENYING THE ALLEGATIONS, PEASLEE CONSENTED TO THE DESCRIBED SANCTION AND TO THE ENTRY OF FINDINGS; THEREFORE HE IS BARRED FROM ASSOCIATION WITH ANY FINRA MEMBER IN ALL CAPACITIES. A)THE OFFER OF SETTLEMENT FINDINGS INCLUDED THAT PEASLEE DID NOT WILLFULLY VIOLATE SECTION 10(B) OF THE SECURITIES EXCHANGE ACT OF 1934 AND SEC RULE 10B-5 AND THEREBY DID NOT VIOLATE FINRA RULE 2020. THE OFFER OF SETTLEMENT FINDINGS INDICATED THAT THE FOLLOWING ALLEGATION OF THE COMPLAINT WAS DROPPED FROM THE FINDINGS OF THE OFFER OF SETTLEMENT: THAT PEASLEE INTENTIONALLY OR RECKLESSLY, BY THE USE OF MEANS OR INSTRUMENTALITIES OF INTERSTATE COMMERCE, OR OF THE MAILS, EMPLOYED DEVICES TO DEFRAUD CUSTOMERS AND MADE UNTRUE STATEMENTS OF MATERIAL FACTS AND/OR OMITTED TO STATE MATERIAL FACTS NECESSARY TO MAKE THE STATEMENTS AND REPRESENTATIONS MADE BY PEASLEE, IN LIGHT OF THE CIRCUMSTANCES IN WHICH THEY WERE MADE, NOT MISLEADING, IN CONNECTION WITH INVESTOR'S INVESTMENT IN THE OFFERING. B)RATHER, THE OFFER FINDINGS INCLUDED THAT PEASLEE NEGLIGENTLY MADE UNTRUE STATEMENTS OF MATERIAL FACTS AND/OR OMITTED TO STATE MATERIAL FACTS NECESSARY TO MAKE THE STATEMENTS AND REPRESENTATIONS MADE BY PEASLEE, IN LIGHT OF THE CIRCUMSTANCES IN WHICH THEY WERE MADE, NOT MISLEADING, IN CONNECTION WITH INVESTOR'S INVESTMENT IN THE OFFERING. THROUGH THIS PEASLEE NEGLIGENTLY MADE MISREPRESENTATION AND OMISSIONS WHICH INVESTORS PLACED RELIANCE UPON AND INVESTED IN THE OFFERING. C)THE OFFER OF SETTLEMENT FINDINGS INCLUDED THAT PEASLEE DID NOT WILLFULLY VIOLATE OF SEA SECTION 10(B), RULE 10B-9 IN CONNECTION WITH HIS FAILURE TO COMPLY WITH CONTINGENCY OFFERING TERMS.