Source Capital Group Exec Scolded AEHI CEO Don Gillispie for "Inappropriate and Misleading" Stockholder Communication

A few more interesting nuggets are found in the latest pile of documents filed in support of the SEC's motion for partial summary judgment.  Alert readers may recall the the post some time ago discussing "DonSpeak" and Gillispie's constant press release claims to "have funding commitments" which he directly contradicted in all of the company's quarterly and annual reports.

On September 9, 2009, AEHI CEO Don Gillispie sent out a shareholder update and stock solicitation (also posted on his "Clean Energy" blog here) which made the claim that that, "“The Idaho reactor, Idaho Energy Complex, is the process of seeking local approval and we expect it by year’s end....   We have a funding commitment from Source Capital for the site."

That particular notification did not sit well with Source Capital Group's "Senior Managing Director of Investment Banking," Richard Kreger, who wrote to Don a few days after the update:

"It was inappropriate and misleading for the company to notify its shareholders that the company has a funding commitment from Source Capital. What the company has from our firm is a commitment to raise capital for the company on a “Best Efforts” basis. Please clear all communications with us before communicating this kind of information with the public.

Here is the document filed by the SEC June 1, which has the email from Mr. Kreger to Don: (go to page 2 of 64, AEHI's "inappropriate and misleading" shareholder communication is right below it.

Interestingly, it was not the first time Mr. Kreger scolded Don for going too far with his "misleading" claims.

Here's the text of a June 5, 2009 AEHI Press Release:

"AEHI signs agreement with Source Capital Group to fund Idaho nuclear site Boise, Idaho, June 5, 2009 – Alternate Energy Holdings, Inc (OTC: AEHI.PK): AEHI signs an agreement to utilize Source Capital Group, Inc. to raise capital for the Idaho nuclear plant site project this week. The funds will cover land, water rights and engineering services to obtain NRC approval to construct and operate an advanced nuclear plant in Elmore County, Idaho. CEO Don Gillispie said, "This is a major step in the process to bring the first commercial nuclear plant to Idaho and the first advanced nuclear plant to the western US that is so in need of clean, low cost base load power to sustain industry and agriculture. We are very pleased to have a company with Source Capital's experience in raising funds for energy projects on board." Richard Kreger, Senior Managing Director of Investment Banking for Source Capital, stated that “Mr. Gillispie and his team have an extensive background in the nuclear power industry and have developed a compelling plan to create a new and much needed energy source for the western United States. We are excited to bring the merits of their vision to investors in an effort to ensure the success of this worthy project.” David Harris, President of Source Capital Group, Inc., affirmed that “clean, low cost energy is one of the most vital areas of focus for our nation’s future. Source is pleased to have the opportunity to leverage its financial services expertise in the energy sector to raise capital for AEHI and this important initiative.”

Mr Kreger sent this admonishment to Don after reading the press release:

“You should have forewarned me about that, number 1. Number 2, I requested that you remove my quote. This is not the way to kick things off. Number 3, I will not speak with reporters at all should they call me as the company is public and I can not disclose material non-public information in regards to this project to anyone not under NDA with the company.”


That email exchange is on page 53 of this document from the SEC filing: