I.

INTRODUCTION

On June 29, 1999, the Plaintiff, Commodity Futures Trading Commission, ("CFTC" or "Commission") filed a Complaint against the Defendant, Kent C. Calhoun, individually, as an agent of or doing business as KCI Seminars ("Calhoun" or "Defendant") seeking preliminary and other equitable relief for violations of the Commodity Exchange Act, as amended ("the Act"), 7 U.S.C. ��1 et seq. (1994). On August 6, 1999, the Commission and the Defendant agreed to the entry of a Consent Order of Preliminary Injunction ("Preliminary Consent Order") and the Court entered the Preliminary Consent Order. (Docket No. 31).

II.

CONSENTS AND AGREEMENTS

To effect settlement of the matters alleged in the Complaint against the Defendant without a trial on the merits or any further judicial proceedings, the Defendant:

1. Consents to the entry of this Consent Order of Permanent Injunction and Other Equitable Relief against Kent C. Calhoun, individually, as an agent of or doing business as KCI ("Consent Order").

2. Affirms that he has agreed to this Consent Order voluntarily, and that no promise or threat has been made by the Commission or any member, officer, agent or representative thereof, or by any other person, to induce consent to this Consent Order, other than as set forth specifically herein.

3. Acknowledges service of the Summons and Complaint.

4. Admits jurisdiction of this Court over him and the subject matter of this action pursuant to Section 6c(a) of the Act, 7 U.S.C. � 13a-1(a) (1994).

5. Admits that venue properly lies with this Court pursuant to Section 6c(a) of the Act, 7 U.S.C.� 13a-1(e) (1994).

6. Waives:

7. Agrees that neither he, nor any agent acting under his control shall take any action or make or permit to be made any public statement denying, directly or indirectly, any finding or conclusion contained in this Consent Order or creating, or tending to create, the impression that this Consent Order is without a factual basis, provided, however, that nothing in this provision affects the Defendant's: (a) testimonial obligations; or (b) right to take legal positions in other proceedings to which the Commission is not a party. The Defendant shall undertake all steps necessary to assure that all of the Defendant's agents and employees understand and comply with this agreement.

8. Consents to the continued jurisdiction of the Court for the purpose of enforcing the terms and conditions of this Consent Order and for any other purposes relevant to this case.

9. Withdraws Defendant's Pro Se Motion for Counterclaim of all Legal Fees and Loss of KCI Income from CFTC Allegations, filed on January 14, 2000, with prejudice, and agrees that this Consent Order otherwise fully disposes of all other matters between the Commission and the Defendant arising out of this action or the Commission's investigation of the Defendant.

10. Consents to the use of the findings contained in this Consent Order in this proceeding and in any other proceeding brought by the Commission or to which the Commission is a party; provided, however, that the Defendant does not consent to the use of his settlement offer or the findings in this Consent Order, as the sole basis for any other proceeding brought by the Commission, other than a proceeding brought to enforce the terms of this Consent Order. The Defendant also does not consent to the use of his settlement offer or the findings in the Consent Order by any other person or entity in this or in any other proceeding. The findings made in the Consent Order are not binding on any other person or entity named as a defendant or respondent in this or any other proceeding.

III.

FINDINGS OF FACT

The Court, being fully advised in the premises, finds that there is good cause for the entry of this Consent Order and that there is no just reason for delay. The Court therefore directs the entry of findings of fact, conclusions of law and a permanent injunction and ancillary equitable relief, pursuant to � 6c of the Act, 7 U.S.C. � 13a-1 (1994), as set forth herein.

The Defendant neither admits nor denies and the Court hereby finds that:

A.

JURISDICTION AND VENUE

1. This Court has subject matter jurisdiction over this action and the allegations in the Complaint pursuant to Section 6c of the Act, 7 U.S.C. � 13a-1 (1994).

2. This Court has personal jurisdiction over Defendant, and Defendant has acknowledged service of the Summons and Complaint, and consented to the Court's jurisdiction over him.

3. The Commission and the Defendant have agreed that this Court shall retain jurisdiction over each of them for the purpose of enforcing the terms of this Consent Order.

B.

THE PARTIES

4. The Plaintiff Commission is an independent federal regulatory agency charged with the responsibility of administering and enforcing the provisions of the Act, 7�U.S.C. ���1 et seq. (1994), and the Regulations promulgated under it, 17�C.F.R. ���1 et seq. (1998).

5. The Defendant, Kent C. Calhoun resides at Canyon Springs Ranch, 111 Cave Spring Drive, Hunt, Texas 78024. The Defendant is the principal agent of the unincorporated sole proprietorship, KCI Seminars. Calhoun has not been registered with the Commission in any capacity since July 1983 when he was registered as a commodity trading advisor ("CTA").

C.

THE FACTS

6. From at least June 1995, and continuing to the present, Calhoun has offered commodity trading advice for compensation to members of the public through commodity trading systems, seminars, videotapes, and trading manuals that Calhoun produces or causes to be produced while conducting business under the name of KCI.

7. From on or about June 1995 through at least January 1999, Calhoun willfully placed advertisements in Futures magazine, a monthly commodity futures industry publication, in connection with others' orders to make, or the making of, contracts of sale of commodities for future delivery in interstate commerce. The advertisements contain the following statements, among others:

8. Each of the foregoing representations was false and/or misleading in claiming that the CFTC had endorsed, recommended, or approved Calhoun, KCI, or the trading systems or conduct of either. Calhoun had no reasonable basis upon which to make such representations, but did so willfully or in reckless disregard of the truth.

9. Calhoun engaged in a direct mailing campaign in connection with others' orders to make, or the making of, contracts of sale of commodities for future delivery in interstate commerce by mailing out approximately 6,100 letters to customers and potential customers between on or about August 1998 and December 1998. In at least one such letter, dated December 15, 1998, which was sent to numerous customers and potential customers, Calhoun willfully asserts that the "CFTC verified 92% of KCI attendees were profitable traders in 1994�...." This statement was false and/or misleading in claiming that the CFTC had endorsed, recommended, or approved Calhoun, KCI, or the trading systems or conduct of either. Calhoun had no reasonable basis upon which to make such a representation, but did so willfully or in reckless disregard of the truth.

10. From at least June 1995 and continuing through the present, Calhoun, while acting as a CTA, represented either directly or through implication in advertisements that KCI, Calhoun, and/or their commodity trading advice, commodity trading systems, seminars and other products and services have been endorsed, sponsored, recommended or approved, and/or that their abilities or qualifications, or those of their systems, have been passed upon by the Commission.

11. The Commission does not pass upon, endorse, sponsor, recommend or approve any CTA, commodity futures trading advice, commodity trading systems, seminars or other futures and options products and services.

12. The Commission did not pass upon, endorse, sponsor, recommend or approve KCI, Calhoun or the commodity futures trading advice, commodity trading systems, seminars or other products and services offered by them.

IV.

CONCLUSIONS OF LAW

Pursuant to the foregoing Findings of Fact, which the Defendant neither admits nor denies, the Court makes the following Conclusions of Law:

1. Beginning in June 1995 and continuing through the present, Calhoun violated Section 4b(a)(i) of the Act, 7�U.S.C. ��6b(a)(i).

2. Beginning in at least June 1995 and continuing through the present, Calhoun, while acting as a CTA and using the mails or other means or instrumentalities of interstate commerce, violated Section 4o(1) of the Act, 7 U.S.C. � 6o(1).

3. Beginning in at least June 1995 and continuing through the present, Calhoun, while acting as a CTA, violated Commission Regulation 4.16, 17 C.F.R. � 4.16, by representing either directly or through implication in advertisements that KCI, Calhoun or their commodity trading systems, seminars and other products and services have been endorsed, sponsored, recommended or approved, and/or that their abilities or qualifications, or those of their systems have been passed upon, by the Commission, when they have not.

4. From at least June 1995 and continuing through the present, Calhoun, while acting as a CTA, violated Commission Regulation 4.41(a), 17 C.F.R. � 4.41(a), in at least one direct-mail campaign.

V.

NOW THEREFORE, IT IS ORDERED THAT:

1. The Defendant is permanently restrained, enjoined and prohibited from:

2. The injunctive provisions of this Consent Order shall be binding upon Calhoun, upon any person insofar as he or she is acting in the capacity of officer, agent, servant, employee or attorney of Calhoun and upon any person who receives actual notice of this Consent Order, by personal service or otherwise, insofar as he or she is acting in active concert or participation with Calhoun.

VI.

ORDER FOR OTHER EQUITABLE RELIEF

IT IS FURTHER ORDERED THAT:

1. Publication of Retractions: The Defendant is ordered to use his best efforts, within thirty (30) days of the entry of this Consent Order, to take all necessary steps, at his own expense, to ensure that the following retraction is included in the advertisement attached hereto as exhibit A, which is to be published in the first available issues of Futures magazine and Technical Analysis of Stocks and Commodities. The language of the retraction shall appear in the center of a full-page advertisement in both of the these magazines and include only the following language without interlineation and in no less than twenty (20) point Times New Roman font:

THE COMMODITY FUTURES TRADING COMMISSION (CFTC) HAS NEVER ENDORSED, RECOMMENDED OR APPROVED KCI SEMINARS, KENT C. CALHOUN OR ANY OF THE PRODUCTS, SERVICES OR PUBLICATIONS OFFERED OR PROVIDED BY OR THROUGH KCI SEMINARS OR KENT C. CALHOUN.

2. Civil Monetary Penalty: The Defendant is ordered to make payment of a civil monetary penalty in the amount of twenty-five thousand dollars ($25,000), such payment to be made within ten (10) days of the entry of this Consent Order, by electronic funds transfer to the account of the Commodity Futures Trading Commission at the United States Treasury, or by U.S. postal money order, certified check, bank cashier's check or bank money order made payable to the Commodity Futures Trading commission and sent to Dennese Posey, or her successor, Division of Trading and Market, Commodity Futures Trading Commission, 1155 21st Street, N.W., Washington, D.C. 20581, under cover of a letter identifying Calhoun and the name and docket number of this proceeding. A copy of the cover letter and the form of payment shall be simultaneously transmitted to Phyllis J. Cela, Acting Director, Division of Enforcement, Commodity Futures Trading Commission, or her successor, at the following address: 1155 21st Street, N.W., Washington D.C. 20581.

3. Default: Any failure by the Defendant to carry out any of the terms, conditions or obligations under any paragraph of this Consent Order shall constitute an Event of Default under this Consent Order. If any Event of Default occurs and, if capable of being cured, is not cured within ten (10) calendar days following the Commission's (or its designee) mailing of notice of such Event of Default to the Defendant, the Commission (or its designee) shall be entitled to:

The Defendant expressly agrees and this Court orders that upon the occurrence of an Event of Default, the Defendant will be barred from asserting any defense, including expiration of any statute of limitations, waiver, estoppel or laches, where such defense is based on the alleged failure of the Commission to pursue such claims or causes of action during the pendency of this civil action, during the negotiation of the Defendant's agreement to this Consent Order or while this Consent Order remains in effect, including the Defendant's obligations under this Consent Order.

VII.

MISCELLANEOUS PROVISIONS

1. Notices: Except as otherwise stated herein, all notices and/or correspondence required to be given by any provision in this Consent Order, or otherwise, shall be sent certified mail, return receipt requested, as follows:

In the event that the Defendant changes his residential or business telephone number(s) and/or address(es) at any time before satisfying all of his obligations under this Consent Order, he shall provide written notice of the new number(s) and/or address(es) to the Commission within ten (10) calendar days thereof.

2. Entire Agreement and Amendments: This Consent Order incorporates all of the terms and conditions of the settlement between the parties hereto. Nothing shall serve to amend or modify this Consent Order in any respect whatsoever, unless: (1)�reduced to writing; (2)�signed by all parties hereto; and (3)�approved by order of this Court.

3. Waiver: The failure of any party hereto at any time or times to require performance of any provision hereof shall in no manner affect the right of such party at a later time to enforce the same or any other provision of this Consent Order. No waiver in one or more instances of the breach of any provision contained in this Consent Order shall be deemed to be or construed as a further or continuing waiver of such breach or waiver of the breach of any other provision of this Consent Order.

4. Successors and Assigns: This Consent Order shall inure to the benefit of and be binding upon the successors, assigns, heirs, beneficiaries and administrators of the parties hereto.

5. Acknowledgements: Upon being served with copies of this Consent Order after entry by this Court, the Defendant shall sign acknowledgments of such service and serve such acknowledgments on this Court and the Commission within seven (7) calendar days.

6. Invalidation: If any provision of this Consent Order, or the application of any provisions or circumstances is held invalid, the remainder of the Consent Order and the application of the provision to any other person or circumstance shall not be effected by the holding.

7. Jurisdiction of this Court: This Court shall retain jurisdiction of this cause to assure compliance with this Consent Order and for all other purposes related to this action.

8. Disposition of the Issues: This Consent Order resolves all issues between the Commission and the Defendant based on the facts underlying this action.

DONE AND ORDERED, ADJUDGED AND DECREED this 29th day of July, 2000.

�

ADDENDUM

(To Substitute for Paragraph 1 under Section VI of Consent Order dated June 9, 2000)

1. Publication of Retractions: The Defendant is ordered to use his best efforts, within thirty (30) days of the entry of this Consent Order, to take all necessary steps, at his own expense, to ensure that the following retraction is published in the first available issues of Futures magazine and Technical Analysis of Stocks and Commodities. The language of the retraction shall appear in the center of a full-page advertisement in both of the these magazines and include only the following language without interlineation and in no less than fourteen (14) point Times New Roman font:

THE COMMODITY FUTURES TRADING COMMISSION (CFTC) HAS NEVER ENDORSED, RECOMMENDED OR APPROVED KCI SEMINARS, KENT C. CALHOUN OR ANY OF THEIR PRODUCTS, SERVICES OR PUBLICATIONS.

Provided, further, that the Defendant shall cause no other advertisement incorporating a larger or more prominent font type or style to be published in the same issues of Futures magazine and Technical Analysis of Stocks and Commodities in which the retraction appears.

Approved and consented to:

__________________________

Kent C. Calhoun, individually, as
an agent of or doing business as
I. KCI

Dated: ____________________