Digital Gas, Inc.(fka DIGGQ)

[scion]

OCR extracts 4/3/07 REQUEST FOR ENTRY OF DEFAULT

http://www.state.nj.us/lps/ca/bos/disc/dgdefault.pdf

This is a rather amusing document in that it includes letters from Brian Smith, starting on page 24, purporting to detail his personal assets and those of Digital Gas. For Digital Gas he simply reprises various of the wonderful deals he had PRed (but never accomplished)and then repeatedly claims the NJ suit hinders their fruition.

This man is truly pathetic and this is truly a 'low rent' scam.

carmelbeach
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OCR extracts pages 24 to 31
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Brian Smith

909 St. Clair- Avenue
Spring Lake, New Jersey 07762
[phone]
March 12, 2007

Mr. Christopher W. Gerold
Deputy Attorney General
State of New Jersey
Newark, New Jersey 07101

Re: Docket No. MON-C-316-06

Dear Mr. Gerold:

Pursuant to the Order of the Hon. Alexander D. Lehrer, I am enclosing a statement that relates to my assets.

With the execution of the search warrant of my house and office at 409 St. Clair Avenue in Spring Lake, most if not all of my personal and business records, as well as the records related to Digital Gas were seized. Despite the fact that I have requested these records, they have not been made available for reviewing or copying. The three hard disks that were given to me by Ms. Zumbo after the November court hearing were damaged to the point of being unreadable. I am therefore not able to provide complete information regarding assets or more specific or detailed information about sonic of these items and matters noted herein, including precise amounts or dates.

There is an instance (possibly more) where I may be entitled to a significant fee and/or damages that might run into the several hundred thousand dollar figure. However, I will not note it herein until I obtain an attorney's advice in this regard. Noting it here is my attempt alert you to the possible existence of a settlement or claim in the matter that might be translated into a monetary amount as noted. The same applies to other business opportunities and interests that have been placed in jeopardy by the filing of this civil suit. None of these involve ownership of assets per se, but represent possible opportunities based on future work and success.

If and when I am able to obtain access to any or all of the seized records, I will update or modify the information provided.

Thank you.

Sincerely,

s/s Brian Smith

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Brian Smith

Statement of Assets

I. Securities

Digital Gas

Shares of Digital Gas owed for the compensation of shareholders of Wickline Energy with the shift of that business into Digital Gas. Shares issued pursuant to this were more or less 7.5 million. On the basis of pro rata ownership, I am entitled to more or less 31 million shares. I am also entitled to cash and other remuneration. Further detail can be provided at a later date after I receive the records that have not been returned as promised and consult with an accounting and attorney.

[Note: Because the Wickline Energy business was not at the commercial stage, I did not issue the more or less 31 million shares in their entirety in fairness to the then present shareholders of Digital Gas. What share were issued were done to further the business of Digital Gas and ensure its survival.]

Wickline Energy

Shares of Wickline Energy owned by me represent approximately 81% of the company with certain of my investors prior to july 1, 2002 owning the balance. Further detail can be provided at a later date after I receive the records that have not been returned as promised and consult with an accountant and attorney.

[Note: Because Wickline Energy still had one investor who could not make up his mind whether to accept Digital Gas shares or accept Wickline shares with the return of his money, the final disposition of the company, its business and any accounting or reporting due regulatory bodies were delayed pending that determination When questioned by the FBI on closing the books in 2002 or 2003, I explained my approach and they had no problem with my method of handling the matter. In fact, right up until the late summer of 2006 the one investor was looking forward to the prospective gains of Digital Gas, yet still reserved the right to not make a final decision in the matter.]

2. Personal

Clothes, pictures, wedding ring, all with no substantive monetary value. A property that my mother bought on a lay-away plan in the 1950s and 1960s was assigned over to my daughter after her birth which pre-dated Digital Gas by several years. My second daughter will also share in it and hopefully pass it on to their children as I intended.

3. Business

Two computers, office furniture, phones, software et cetera.

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Digital Gas

433 South Ashley Street
Ann Arbor, Michigan 18103
[phone]
March 12, 2007

Mr. Christopher W. Gerold
Deputy Attorney General
State of New Jersey
Newark, New Jersey 07101

Re: Docket No. MON-C-316-06

Dear Mr. Gerold:
Pursuant to the Order of the Hon. Alexander 0. Lehrer, we are enclosing a statement that relates to our assets.

With the execution of the search warrant at 409 St. Clair Avenue in Spring Lake, records related to Digital Gas were seized. Despite the fact that the company and I have requested these records, they have not been made available for reviewing or copying. The three hard disks that were given to me by Ms. Zumbo after the November court hearing were damaged to the point of being unreadable. I am therefore not able to provide complete information regarding assets or more specific or detailed information about some of these items and matters noted herein, including precise amounts or dates.

Many of the press releases related to Digital Gas refer to business deals that the company considers active. Several of the same may be brought to a successful conclusion through negotiation or, if necessary, through litigation. A successful conclusion would entail business being transacted with the companies or persons. A less successful conclusion would be the award of cash, shares, rights to do certain business of the company or person or some other acceptable compensation, but with no agreement to do business together as might have been originally planned. An unsuccessful conclusion would be a failed negotiation or failed litigation and there either being no remuneration or none recommended to pursue by our attorney. If and when we are able to obtain access to any or all of the seized records, I will update or modify the information provided.

There is an instance (possibly more) where the company may be entitled to a significant fee and/or an award of damages that might run into the several million dollar or possibly tens of millions of dollars range. However, I will not note it herein until I obtain an attorney's advice in this regard. Noting it here is my attempt alert you to the possible existence of a settlement or claim in the matter that might be translated into a monetary amount as noted. The same applies to other business opportunities and interests that have been placed in jeopardy by the filing of this civil suit. None of these involve ownership of assets per se, but represent possible opportunities based on future work and success.

As I noted above, if and when I am able to obtain access to any or all of the seized records, I will update or modify the information provided.

Thank you.
s/s
Brian Smith
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Digital Gas

Statement of Assets and Core Operating Subsidiaries

Digital Gas had successful funding meetings in the late summer and fall of 2006 and anticipated all of its businesses being bridge and/or senior funded by the end of the first quarter, 2007. The civil suit and the restraints have delayed these bindings and have endangered the full potential of the company that existed prior to the complain t. With the further clarification of these matters with the return of the records seized in October, 2006, the company feels that it can establish a basis for requesting that the restraints be removed and the company returned to full operation.

The following is a list of assets and core operating subsidiaries.

I. Green Harbour

Three quarries sold to a subsidiary of Digital Gas in Nova Scotia. The subsidiary is Green Harbour Energy & Farming. The seller is Nova Stone Exporters. The properties are in Annapolis and Shelburne counties.

The seller has not executed the transfer of ownership on the deed to the subsidiary as required in a signed agreement dated November 2004. Under this agreement, the ownership would pass to Green Harbour and the seller would receive 25% of Green Harbour and take back a promissory note.

The proffered reason for not concluding that deal was that the seller indicated that other properties might be better to develop in the near-term. Digital Gas has pursued this avenue without giving up or compromising its rights under the 2004 agreements.
Several properties have been presented by the seller, but none have been found to be without problems. The latest appears to be highly prospective and Green Harbour has a 50% interest in one of six properties that would constitute one integrated quarry. However, the restraints imposed by the court are making it difficult for the company to maintain the above interest and purchase the quarry operation currently the subject of an agreement

If this separate transaction fails, Digital Gas will empower its attorney to resolve the transfer of ownership issue through negotiation or litigation. Once these quarries are fully permitted and in operation, they will have a projected value of more or less $250 million on the basis of a $.50 per ton valuation for the aggregate represented.

Complicating these transactions has been the fact that persons formerly connected to the company from Florida and New Jersey have actively interacted with the seller to interfere with Digital Gas. This interference has taken several forms and has involved, over the course of the Last two years, the participation of two major aggregate companies.

Any interference in these negotiations at this time could prejudice the company's legal position regarding ownership which is excellent. We are willing to clarify if asked.

2. Digital Sofcell

Manufacturing and marketing rights to several sets of products and technologies in the fuel cell area covered by patents for the following territories: North America; South America; and Central America. The civil suit and the restraints have delayed the development of this company and endangered its full potential that existed prior to the complaint Once the restraints are removed and the company returned to full operation, Digital Gas and its shareholders may still realize the potential that was promised to shareholders and investors. If, due to the continued restraints, Digital Sofcell loses products and technologies currently under development, the company will continue with lesser products and technologies. Due to innovative sales and marketing ideas and plans, the company can still be commercial, but will be less profitable.

3. Digital Ultracap

Manufacturing and marketing rights to a set of products and technologies in the mass storage device area covered by patents for the following territories: North A merica; South America; and Central America. The civil suit and the restraints have delayed the development of this company and endangered its full potential that existed prior to the complaint. Once the restraints are removed and the company returned to full operation, Digital Gas and its shareholders may still realize the potential that was promised to shareholders and investors. If, due to the continued restraints, Digital Ultracap loses products and technologies ready to be marketed now and others underdevelopment, the company will continue with lesser products and technologies. Due to innovative sales and marketing ideas and plans, the company can still be commercial, but will be less profitable. The loss of this relationship would be more damaging then in the fuel cell area in that the company has products ready to be marketed now that would capture a significant share of the air conditioner market.

4. Great Lakes Energy & Farming

This energy & farming subsidiary will run operations in cities, adjacent to corporate facilities and on farmland in the Great Lakes region of the United States. Similar subsidiaries and Special Purpose Corporations will be formed by region or in conjunction with strategic partners across North America, South America and Central America and in other areas, such as Vietnam, Taiwan and China. The facilities, which will benefit from products and technologies in the fuel cell and mass storage area, are largely a function of sales and marketing efforts and addressing the needs of potential clients in a way that is still several years ahead of the competition. Each facility will yield significantly profitable clean energy, food and water products, including such high profit output as hydroponics, aquaculture, pharmaceuticals, carbon-based materials processing plants (e.g. carbon nanotubes and carbon black) and others. Pending plants are in Missouri and Michigan. The civil suit and the restraints have delayed the development of this company and endangered its full potential that existed prior to the complaint. Once the restraints are removed and the company returned to full operation, Digital Gas and its shareholders may still realize the potential that was promised to shareholders and investors.

Unlike the subsidiaries that are relying on maintaining proprietary technology, such as in fuel cells and mass storage devices, Great Lakes Energy & Farming (and other regional subsidiaries) can operate and still be commercial, even with the restraints. A “top ten" international engineering firm will do the design, build, operating and maintenance of this and other region's plants under a performance. Unfortunately, the contracts and agreements that would be signed would be from a position of weakness and the company would lose significant percentage ownership and be far less profitable than it would without the restraints.

5. Digital Electric.

This subsidiary will sell electricity generated from fuel cells, ultracapacitors and other systems. Digital Electric will market its so-called Distributed Generation products for residential and commercial buildings via a network of collaborative utilities, HVAC companies and industrial electrical companies. Its products will be distributed both via direct sales and under leasing agreements. In some instances, Digital Electric will even arrange for a supply of renewable fuels for the units that it markets. The potential profits within Digital Electric, including sale of electricity, steam, renewable fuels and gas, are in fact potentially greater, on a long term basis, than from the sale of the fuel cells and ultracapacitors themselves. Gas sales for Digital Electric will be much like the sale of ink torprinters that has become a major profit generator for companies such as Lexmark. The viability of this subsidiary is significantly dependent upon Digital Gas maintaining the current products and technologies of Digital Sofcell and Digital Ultracap. Although the subsidiary could use third party products and technologies, its selling advantage would be greatly diminished. The company has potential contracts for facilities that can be closed within 2007 of between $1-5 billion in Michigan alone. The civil suit and the restraints have delayed the development of this company and endangered its full potential that existed prior to the complaint. Once the restraints are removed and the company returned to f ull operation, Digital Gas and its shareholders may still realize the potential that was promised to shareholders and investors.

6. Synfuel Corporation

Manufacturing and marketing rights to participate in the unconventional oil-source sector of the oil & gas industry. Through the application of patented breakthrough geothermic fuel cell-based in-situ production technology, the company will exploit vast tracts of oil reserves that were previously thought to be unrecoverable. If, due to the continued restraints, Synfuel loses products and technologies currently under development, the company will continue with lesser products and technologies. Due to innovative sales and marketing ideas and plans, the company can still be commercial, but will be less profitable. The civil suit and the restraints have delayed the development of this company and endangered its full potential that existed prior to the complaint. Once the restraints are removed and the company returned to full operation, Digital Gas and its shareholders may still realize the potential that was promised to shareholders and investors.

7. Other

Digital Gas has other situations that can be commercial or prospective. All press releases are relevant and have potential commercial import either through commercialization or litigation.

The company has acted with restraint in these instances in the best interest of shareholders.

The civil suit and the restraints have delayed the development and funding of these situations and endangered the full potential of the company that existed prior to the complaint. With the further clarification of these matters with the return of the records seized in October, 2006, the company feels that it can establish a basis for requesting that the restraints be removed and the company returned to full operation.

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OCR extracts 4/3/07 REQUEST FOR ENTRY OF DEFAULT
http://www.state.nj.us/lps/ca/bos/disc/dgdefault.pdf