SECURITIES AND EXCHANGE COMMISSION Litigation Release 15467 / September 2, 1997 Accounting and Auditing Enforcement Release No. 949 / September 2, 1997 SEC v. Digitran Systems, Inc., Donald G. Gallent and James R. Bryan, Civil Action No. 94C-NC-173C (USDC UT). The Commission announced that on August 18 and August 20, respectively, The Honorable Tena Campbell of the U.S. District Court for the District of Utah issued Final Judgments of Permanent Injunction against Donald G. Gallent (Gallent) and James R. Bryan (Bryan). Gallent and Bryan, who consented to the orders without admitting or denying the Commission's allegations, were enjoined from further violations of the antifraud and reporting provisions of the federal securities laws. The court waived disgorgement and determined not to impose civil penalties based on the demonstrated inability of the defendants to pay. The Commission's Complaint, filed on December 29, 1994, against Digitran Systems, Inc. (Digitran), Gallent, and Bryan, alleged that Digitran made false and misleading statements concerning the company's sales and leases of simulators and about its financial condition and operations. The Complaint also alleged that Gallent, the president of Digitran at the time of the alleged misconduct, and Bryan, Digitran's chief financial officer at that time, failed to maintain sufficient internal accounting controls and misled Digitran's auditors in connection with an audit of Digitran's financial statements for the fiscal year ended April 30, 1992. Under the terms of the Order, Gallent and Bryan are enjoined from future violations of Section 17(a)(1), (2), and (3) of the Securities Act of 1933, as amended, and from future violations of Sections 10(b) and Rule 13(b) of the Securities Exchange Act of 1934, as amended, and Rules 10b-5, 12b2-1 and 13b2-2 thereunder. ======END OF PAGE 1======