UNITED STATES OF AMERICA Before the SECURITIES AND EXCHANGE COMMISSION SECURITIES EXCHANGE ACT OF 1934 Release No. 40362 / August 25, 1998 ADMINISTRATIVE PROCEEDING File No. 3-9685 : : ORDER INSTITUTING CEASE- In the Matter of : AND-DESIST PROCEEDINGS : PURSUANT TO SECTION 21C OF Jacqueline Badger Mars, : THE SECURITIES EXCHANGE ACT : OF 1934 AND FINDINGS AND Respondent. : ORDER OF THE COMMISSION : I. The Commission deems it appropriate and in the public interest that public administrative proceedings be, and they hereby are, instituted pursuant to Section 21C of the Securities Exchange Act of 1934 ("Exchange Act") to determine whether Jacqueline Badger Mars ("J.B. Mars") violated (or caused violations of) Sections 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. II. In anticipation of the institution of these administrative proceedings, J.B. Mars ("the Respondent") has submitted an Offer of Settlement which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceeding brought by or on behalf of the Commission or to which the Commission is a party, the Respondent, without admitting or denying the matters set forth herein, consents to the issuance of this Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934 and Findings and Order of the Commission ("the Order"), and to the entry of the findings, and imposition of the remedial sanctions set forth below. III. On the basis of this Order and the Respondent's Offer of Settlement, the Commission finds the following: A.FACTS 1.Respondent Jacqueline Badger Mars, is and has been at relevant times a beneficial owner of more than ten percent of the equity securities of AmerAlia, Inc. ("AmerAlia") through the Jacqueline Badger Mars Trust. 2.ISSUER AmerAlia, Inc., a Utah corporation with its principal offices in Colorado Springs, Colorado, is primarily engaged in establishing a chemical business in the manufacture of sodium bicarbonate and related products. According to AmerAlia's most recent Annual Report on Form 10-K for its fiscal year ended June 30, 1997, it had total assets of approximately $3 million and shareholders' equity of approximately $2.3 million. As of September 3, 1997, AmerAlia had 3,355,535 shares of common stock issued and outstanding. AmerAlia reported a net loss of $769,000, or $.26 per share for the fiscal year ended June 30, 1997. AmerAlia's common stock has been registered with the Commission pursuant to Section 12 of the Exchange Act since July 28, 1987, and, since August 1987, has been quoted on the NASDAQ Small-Cap Market. B.APPLICABLE LAW Section 13(d) of the Exchange Act and Rule 13d-1 thereunder, in relevant part, provide that any person who, after acquiring directly or indirectly the beneficial ownership of any equity security of a company registered pursuant to Section 12 of the Exchange Act, is directly or indirectly the beneficial owner of more than 5 percent of such security, shall, within 10 days after such acquisition, file a schedule 13D with the Commission and the appropriate exchange.[1] Rule 13d-2(a) requires that amendments to Schedule 13D be promptly filed if any material change to the facts set forth in the Schedule 13D occurs. Section 16(a) of the Exchange Act requires that beneficial owners of more than ten percent of any class of any equity security registered pursuant to Section 12 of the Exchange Act and the officers and directors of the issuer of any such security (hereinafter "insider") file a statement with the Commission by the effective date of a registration statement filed pursuant to Section 12 of the Exchange Act, or within ten days of becoming such officer, director or beneficial owner, reporting the amount of all equity securities of such issuer of which they are a beneficial owner. Section 16(a) also requires an insider to file with the Commission within ten days after the close of each calendar month, if there has been a change in the insider's ownership of the issuer's equity securities during such month, a statement indicating such changes. The rules enacted pursuant to Section 16(a) provide that an initial statement by an insider is to be made on a Form 3 and subsequent statements of changes in beneficial ownership are to be made on a Form 4 or a Form 5. C. J.B. MARS' VIOLATIONS OF SECTIONS 13(d) and 16(a) OF THE EXCHANGE ACT AND THE RULES THEREUNDER On October 10, 1995, J.B. Mars and AmerAlia entered into a financing agreement pursuant to which J.B. Mars deposited $2 million into an escrow account for AmerAlia's use in exchange for shares of AmerAlia stock. AmerAlia disclosed this escrow arrangement in a Form 10-Q for the fiscal quarter ended December 31, 1995. Pursuant to the agreement, on twelve separate occasions, AmerAlia withdrew funds from the escrow account and transferred to J.B. Mars shares of Series D Convertible Preferred Stock. As shown in the Tables attached hereto, J.B. Mars failed to timely file for periods ranging from one week to more than two years and ten months seventeen amendments to Schedule 13D, reporting acquisition of the equity securities of AmerAlia and changes thereto. J.B. Mars failed to timely file thirteen Forms 4 for periods ranging from three weeks to more than two years, reporting changes in her beneficial ownership of the equity securities of AmerAlia, and failed to timely file for six months, and one year and six months, two Forms 5. The value of J.B. Mars' stock transactions in late Form 4 filings for AmerAlia is approximately $2.2 million. J.B. Mars has represented that her delinquent filing of Forms 4 and amendments to Schedule 13D resulted from the fact that AmerAlia had sole discretion as to when disbursements were made from the escrow account. J.B. Mars' reliance on AmerAlia to notify her of transactions in her account does not excuse her violations. Further, AmerAlia's disclosure of the escrow arrangement did not satisfy J.B. Mars' filing obligations under Sections 16 and 13(d) of the Exchange Act. The Commission has previously noted that the responsibility to comply with the securities ownership reporting provisions rests with the insider and that, absent adequate and effective safeguards, reliance on others does not relieve the insider of his or her reporting obligations. See In the Matter of Bettina Bancroft, Admin. Pro. No. 3-7999 (March 23, 1993) J.B. Mars failed to satisfy her reporting obligations because she took inadequate steps to monitor her acquisitions of stock through the escrow arrangement and to ensure that the required filings on her behalf were made on a timely basis. **FOOTNOTES** [1]:The Commission recently adopted amendments to Regulation13D-G under the Exchange Act, permitting certain largeshareholders to use short form Schedule 13G, rather thanlong form Schedule 13D, to report accumulations and changesin stock holdings. The shareholders that will be permittedto use Schedule 13G under these amendments are ones that ownless than 20% and that do not have the purpose or effect of (continued...) (...continued) changing or influencing control of the issuer. See ReleaseNo. 34-39538, January 12, 1998 (63 Fed. Reg. 2854, January16, 1998). JACQUELINE BADGER MARS as Trustee of the Jacqueline Badger Mars Trust Forms 3, 4 and 5 AmerAlia, Inc. December 18, 1992 through April 7, 1998 Form 3 12-92 Series 666,666 12-21-92 T A ConvPfdStk 12-18-92 (26,666,640 c/s) Forms 4, 5 10-93 Purchase 25,000 10.00 250,000 11-10-93 T Series B ConvPfdStk 11-05-93 05-94 Other 60,000 1.50 90,000 N/A** T Acq *** 12-02-97 01-95 Other 60,000 1.50 90,000 N/A** T Acq *** 12-02-97 01-95 Other 11,250 2.00 22,500 N/A** T Acq *** 12-02-97 10-95 Purchase 500 1,000 500,000 11-13-95 2y2w Series D ConvPfdStk12-02-97 01-96 Purchase 180 1,000 180,0000 2-12-96 1y9m2w Series D ConvPfdStk 12-02-97 01-96 Other 60,000 1.50 90,000 N/A** T Acq *** 12-02-97 01-96 Other 11,250 2.00 22,500 N/A** T Acq *** 12-02-97 01-96 Other 10,820 1.00 10,820 N/A** T Acq *** 12-02-97 02-96 Purchase 450 1,000 450,000 03-11-96 1y8m3w Series D ConvPfdStk 12-02-97 04-96 Purchase 100 1,000 100,000 05-10-96 1y6m3w Series D ConvPfdStk 12-02-97 05-96 Purchase 75 1,000 75,000 06-10-96 1y5m3w Series D ConvPfdStk 12-02-97 05-96 Other 21,770 1.00 1,770 N/A** T Acq *** 12-02-97 06-96 Purchase 50 1,000 50,0000 7-10-96 1y4m3w Series D ConvPfdStk 12-02-97 FY-96 Form 5 08-14-96 1y6m 02-10-98 07-96 Other 31,860 1.00 31,860 N/A** T Acq *** 12-02-97 08-96 Purchase 75 1,000 75,000 09-10-96 1y2m3w Series D ConvPfdStk 12-02-97 10-96 Other 34,940 1.00 34,940 N/A** T Acq *** 12-02-97 10-96 Other 11,250 2.00 22,500 N/A**T Acq *** 12-02-97 11-96 Purchase 100 1,000 100,000 12-10-96 11m3w Series D ConvPfdStk 12-02-97 02-97 Other 37,065 1.00 37,065 N/A** T Acq *** 12-02-97 02-97 Other 60,000 1.50 90,000 N/A** T Acq *** 12-02-97 02-97 Purchase 55 1,000 55,000 03-10-97 8m3w Series D ConvPfdStk 12-02-97 04-97 Purchase 100 1,000 100,000 05-12-97 6m2w Series D ConvPfdStk 12-02-97 04-97 Other 38,975 1.00 38,975 N/A** T Acq *** 12-02-97 05-97 Purchase 75 1,000 75,000 06-10-97 5m3w Series D ConvPfdStk 12-02-97 FY-97 Form 5 08-14-97 6m 02-10-98 09-97 Purchase 240 1,000 240,000 10-10-97 1m3w Series D ConvPfdStk 12-02-97 09-97 Other 43,064 1.00 43,064 N/A** T Acq *** 12-02-97 09-97 Other 44,000 1.00 44,000 N/A** T Acq *** 12-02-97 10-97 Conv of 25,000 10.00 250,000 11-10-97 3w Series B ConvPfdStk 12-02-97 into 125,000 shrs c/s 11-97 Other 58,300 1.50 87,450 N/A** T Acq *** 12-10-97 11-97 Other 16,667 1.00 16,667 N/A** T Acq *** 12-10-97 11-97 Conv of 666,666 1.50 1,000,000 12-10-97 T Series A ConvPfdStk 12-10-97 into 666,666 shrs c/s 12-97 Conv of 2,000 1,000 2,000,000 01-12-98 T Series D ConvPfdStk 01-08-98 into 2,000 shrs Series E ConvPfdStk 01-98 Other 33,333 1.00 33,333 N/A** T Acq *** 02-10-98 03-98 Other 50,000 1.00 50,000 N/A** T Acq *** 04-07-98 Total value late reported transactions: $ 2,250,000 * = Price per share rounded off ** = Non-Applicable, transactions may be deemed exempt pursuant to Rule 16a-9(a) of the Exchange Act *** = Convertible Preferred Stock Dividends Acq = Acquired N/A = Non-Applicable ConvPfdStk = Convertible Preferred Stock conv = conversion c/s = common stock Schedules 13D and Amendments AmerAlia, Inc. December 10, 1992 through April 1, 1998 12-10-92 13D 666,666 12-21-92 T 12-18-92 10-29-93 13D Amendment Change 10-29-93* T Items 1, 11-05-93 3 and 5** 01-18-95 13D Amendment Change 01-18-95 2y10m2w Items 1, 12-08-97 3 and 5 10-10-95 13D Amendment Change 10-10-95 2y1m3w Items 1, 12-08-97 3 and 5 01-02-96 13D Amendment Change 01-02-96 1y11m Items 1, 12-08-97 3 and 5 01-08-96 13D Amendment Change 01-08-96 1y10m3w Items 1, 12-08-97 3 and 5 02-18-96 13D Amendment Change 02-18-96 1y9m2w Items 1, 12-08-97 3 and 5 05-23-96 13D Amendment Change 05-23-96 1y6m1w Items 1, 12-08-97 3 and 5 06-04-96 13D Amendment Change 06-04-96 1y6m Items 1, 12-08-97 3 and 5 07-15-96 13D Amendment Change 07-15-96 1y4m2w Items 1, 12-08-97 3 and 5 10-29-96 13D Amendment Change 10-29-96 1y1m1w Items 1, 12-08-97 3 and 5 11-13-96 13D Amendment Change 11-13-96 1y2w Items 1, 12-08-97 3 and 5 03-07-97 13D Amendment Change 03-07-97 8m3w Items 1, 12-08-97 3 and 5 04-03-97 13D Amendment Change 04-03-97 8m Items 1, 12-08-97 3 and 5 09-03-97 13D Amendment Change 09-03-97 3m Items 1, 12-08-97 3 and 5 09-30-97 13D Amendment Change 09-30-97 2m Items 1, 12-08-97 3 and 5 10-29-97 13D Amendment Change 10-29-97 1m Items 1, 12-08-97 3 and 5 11-28-97 13D Amendment Change 11-28-97 1w Items 1, 12-10-97 3 and 5 12-16-97 13D Amendment Change 12-16-97 2w Items 1, 01-05-98 3 and 5 03-31-98 13D Amendment Change 03-31-98 T Items 1, 04-01-98 3 and 5 * = For the purpose of this table, the due date for amendments reflects the date the obligation to file the amendment arose. ** = Items refers to Items of Schedules 13D. V. FINDINGS Based on the above, the Commission finds that J.B. Mars violated Sections 13(d) and 16(a) of the Exchange Act, Rules 13d- 1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. V. OFFER OF SETTLEMENT J.B. Mars has submitted an Offer of Settlement in this proceeding which the Commission has determined to accept. J.B. Mars, in her Offer, consents to this Order making findings, as set forth above, and ordering her to cease and desist from committing or causing any violations of, and committing or causing any future violations of, Sections 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. VI. ORDER Accordingly, IT IS HEREBY ORDERED, pursuant to Section 21C of the Exchange Act, that J.B. Mars cease and desist from committing or causing any violations of, and committing or causing any future violations of, Sections 13(d) and 16(a) of the Exchange Act and Rules 13d-1, 13d-2, 16a-2 and 16a-3 promulgated thereunder. By the Commission. Jonathan G. Katz Secretary