I am not doing a lot. I am retired. Doing a bit of share trading and own a bit of real estate.
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BUT NOW THE STORY TURNS SAD...SNIFF SNIFF...THE CDEX LAWYER SAYS PLEASE JUDGE. DON'T MAKE US DO ALL THAT!! WE AIN'T GOT TIME WHAT WITH RUNNING THE COMPANY AND ALL...
So the JUDGE BACKS DOWN..VACATES HIS PREVIOUS ORDER.
Eric Slocum Sparks
Arizona State Bar No. 11726
LAW OFFICES OF ERIC SLOCUM SPARKS, P.C.
110 South Church Avenue, #2270
Tucson, Arizona 85701
Telephone (520) 623-8330
Facsimile (520) 623- 9157
law@ericslocumsparkspc.com
Attorney for Debtors
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ARIZONA
In re: ))
CDEX INC, ) Case No. 4:12-bk-02402-JMM
))
(Chapter 11)
))
Debtor. ) ORDER VACATING ORDER
) COMPELLING APPEARANCE FOR
) RULE 2004 EXAMINATION AND RULE
) 9016 PRODUCTION OF DOCUMENTS
)
THIS MATTER having come before the Court on the Debtor’s Motion for Order
Vacating Order Compelling Appearance for Rule 2004 Examination and Rule 9016 Production
of Documents and good cause appearing;
IT IS HEREBY ORDERED that the Debtor’s Motion for Order Vacating Order
Compelling Appearance for Rule 2004 Examination and Rule 9016 Production of Documents at
Docket Entry #69 is GRANTED and the Order Compelling Appearance for Rule 2004
Examination and Rule 9016 Production of Documents at Docket Entry #69 is hereby
VACATED.
DATED, SIGNED AND ORDERED ABOVE
Dated: May 30, 2012
THIS ORDER IS APPROVED.
James M. Marlar, Chief Bankruptcy Judge
_________________________________
Case 4:12-bk-02402-JMM Doc 75 Filed 05/30/12 Entered 05/31/12 10:45:04 Desc
Main Document - Motion to Vacate Page 1 of 1
MY STARS!! The Judge actually approved the motion of that Scuddy Scoundrel to get ahold of CDEX "secrets"..TUT TUT!
And included, the dearly and closely held NON DISCLOSURES that PEENSTREET has not revealed re ROBERT STEWART. That person that has agreed to loan money to CDEX. THAT SIGNATORY re the non existant ONCOLOGY distributorship. That very hot air scam that JAYBEE FRAUDULENTLY reported to the SEC as sale of PRODUCT..
ANOTHER VERBATIM COPY OF A FILING, IN WHICH HIS HONOR APPROVED
UNITED STATES BANKRUPTCY COURT DISTRICT OF ARIZONA
In re:
CDEX, INC.,
Debtor.
No. 4-12-BK-2402-JMM
ORDER COMPELLING APPEARANCE FOR RULE 2004 EXAMINATION AND RULE 9016 PRODUCTION OF DOCUMENTS
Upon consideration of creditor James Ryles’ Motion, through counsel, for an order pursuant to Rule 2004 and Rule 9016, Federal Rules of Bankruptcy Procedure, and good cause appearing therefor,
IT IS ORDERED that Debtor’s Chief Executive Officer Jeffrey K. Brumfield shall appear and submit to examination under oath and submit the records described below for copying at the law offices of Heurlin Sherlock Laird, 1636 North Swan Road, Suite 200, Tucson, Arizona, on June 4, 2012, beginning at 10 a.m.
The scope of the examination shall be:
•
Any/all transfers or sales of assets of Debtor from November 12, 2011 until the day of examination.
•
The source, current status, and all terms or agreements of any kind related to the $200,000 that was the subject of Debtor’s March 14, 2012 Motion for Order to Return Funds.
•
The source, current status, and all terms or agreements of any kind related to the approximately $275,000 of separately held funds.
•
The current status of any/all contracts or potential contracts for sales or potential sales of Debtor’s Vali Med systems, and any other products/technology of any kind. • Inventory of all Debtor assets, including but not limited to the following: Ocean Optics USB 2000 + Spectrometer, Ocean Optics USB 2000 + NOS,
Dated: May 21, 2012
THIS ORDER IS APPROVED.
James M. Marlar, Chief Bankruptcy Judge
_________________________________
Case 4:12-bk-02402-JMM Doc 69 Filed 05/21/12 Entered 05/22/12 08:14:35 Desc
Main Document - Motion to Compel Page 1 of 2
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Flashlamp Light Sources.
•
Transfers of assets or payments of any kind from CDEX to Jeffrey Brumfield, Wade Poteet, Steven McCommon, Sean Brumfield, Robert Stewart, from November 12, 2011 until the day of examination.
•
Any and all other matters relevant to Debtor’s finances, debts, assets, and bankruptcy.
•
All documents/subjects listed below.
IT IS FURTHER ORDERED that the documents listed below shall be produced on or before 10:00 a.m., June 4, 2012, at Heurlin Sherlock Laird, 1636 North Swan Road, Suite 200, Tucson, Arizona 85712.
The documents to be produced are:
•
All emails or other written communications between Mr. Brumfield and Robert Stewart from November 12, 2011 until the day of examination.
•
All non-privileged written communications between Mr. Brumfield and any member of the Baxa and or Pemco companies.
•
All written communications and documents of any kind related to the $200,000 that was the subject of Debtor’s March 14, 2012 Motion for Order to Return Funds.
•
All written communications and documents of any kind related to the approximately $275,000 of separately held funds.
•
All written communications and documents of any kind related to any transfers of assets or payments of any kind from CDEX to Jeffrey Brumfield, Wade Poteet, Steven McCommon, Sean Brumfield, Robert Stewart, from November 12, 2011 until the day of examination.
•
All written communications and documents of any kind related to inventory of all Debtor assets, including but not limited to the following: Ocean Optics USB 2000 + Spectrometer, Ocean Optics USB 2000 + NOS, Flashlamp Light Sources.
•
All written communications and documents of any kind related to the current status of any/all contracts or potential contracts for sales or potential sales of Debtor’s Vali Med systems, and any other products/technology of any kind.
•
All other documents otherwise relevant to the subjects listed in number 5, above.
SIGNED AND DATED ABOVE Case 4:12-bk-02402-JMM Doc 69 Filed 05/21/12 Entered 05/22/12 08:14:35 Desc
Main Document - Motion to Compel Page 2 of 2 HONOR THE JUDGE APPROVED THE REQUEST OF RYLES FOR PRODUCTION OF DOCUMENTS.
NOTICE that ROBERT STEWART has prominent mention in the filing. Since it well known to all that PENNSTREET and said Robert Strwart are identical or so, that could explain the concern of said ROBERT STEWART re JR, said to be aka James Ryals..All of which are, or were prominent in the affairs of CDEX.
SAID JR was aka "THE PLUMBER" on a CDEX related forum. in which he made certain allegations re CDEX and its management. Carefully worded, however to protect "the innocent" The innocent being himself.
A recent filing, shown on this very forum, revealed the wrath of CDEX management re the sayings of THE PLUMBER..in which they accused the afore-mentioned James Ryles of being a spy on the various secrets of said CDEX.
ANOTHER VERBATIM COPY OF A FILING RE RYLES
A. Laird, SBN 020541, blaird@HSLazlaw.com
Attorney for Creditor James Ryles
UNITED STATES BANKRUPTCY COURT DISTRICT OF ARIZONA
In re:
CDEX, INC.,
Debtor.
No. 4-12-BK-2402-JMM
MOTION FOR ORDER COMPELLING RULE 2004 EXAMINATION AND RULE 9016 PRODUCTION OF DOCUMENTS
Pursuant to Rule 2004 and Rule 9016 Federal Rules of Bankruptcy Procedure, Creditor James Ryles, through counsel, requests the Court to order Debtor’s CEO Jeffrey K. Brumfield to (a) appear for an examination under oath, and (b) to produce for inspection and copying the documents described in paragraph 8, below, in the possession or control of Jeffrey K. Brumfield and/or Debtor and its agents/officers/employees, as follows:
1.
Witnesses to be examined: Jeffrey K. Brumfield.
2.
Date: June 11, 2012.
3.
Time: 10:00 a.m.
4.
Place: Heurlin Sherlock Laird, 1636 North Swan Road, Suite 200,
Tucson, Arizona 85712.
5.
Scope of Examination: • Any/all transfers or sales of assets of Debtor from November 12, 2011 until Case 4:12-bk-02402-JMM Doc 67 Filed 05/17/12 Entered 05/17/12 14:26:11 Desc
the day of examination.
•
The source, current status, and all terms or agreements of any kind related to the $200,000 that was the subject of Debtor’s March 14, 2012 Motion for Order to Return Funds.
•
The source, current status, and all terms or agreements of any kind related to the approximately $275,000 of separately held funds.
•
The current status of any/all contracts or potential contracts for sales or potential sales of Debtor’s Vali Med systems, and any other products/technology of any kind.
•
Inventory of all Debtor assets, including but not limited to the following: Ocean Optics USB 2000 + Spectrometer, Ocean Optics USB 2000 + NOS, Flashlamp Light Sources.
•
Transfers of assets or payments of any kind from CDEX to Jeffrey Brumfield, Wade Poteet, Steven McCommon, Sean Brumfield, Robert Stewart, from November 12, 2011 until the day of examination.
•
Any and all other matters relevant to Debtor’s finances, debts, assets, and bankruptcy.
•
All documents/subjects listed in number 8, below.
6.
The moving party calculates the mileage pursuant to F.R.B.P. 2004(e) as 10 miles round-trip. Mileage and witness fee will be advanced.
7.
Time, Date and Place of Production of Documents: June 4, 2012, 10:00 a.m., Heurlin Sherlock Laird, 1636 North Swan Road, Suite 200.
8.
Documents to be produced:
•
All emails or other written communications between Mr. Brumfield and Robert Stewart from November 12, 2011 until the day of examination.
•
All non-privileged written communications between Mr. Brumfield and any member of the Baxa and or Pemco companies.
Case 4:12-bk-02402-JMM Doc 67 Filed 05/17/12 Entered 05/17/12 14:26:11 Desc
Main Document Page 2 of 4
All written communications and documents of any kind related to the $200,000 that was the subject of Debtor’s March 14, 2012 Motion for Order to Return Funds.
•
All written communications and documents of any kind related to the approximately $275,000 of separately held funds.
•
All written communications and documents of any kind related to any transfers of assets or payments of any kind from CDEX to Jeffrey Brumfield, Wade Poteet, Steven McCommon, Sean Brumfield, Robert Stewart, from November 12, 2011 until the day of examination.
•
All written communications and documents of any kind related to inventory of all Debtor assets, including but not limited to the following: Ocean Optics USB 2000 + Spectrometer, Ocean Optics USB 2000 + NOS, Flashlamp Light Sources.
•
All written communications and documents of any kind related to the current status of any/all contracts or potential contracts for sales or potential sales of Debtor’s Vali Med systems, and any other products/technology of any kind.
•
All other documents otherwise relevant to the subjects listed in number 5, above.
9.
The debtors will be served through counsel with a notice of the deposition and requests for production upon issuance of an order compelling the examination and production.
Dated: May 17, 2012.
s/ Brian A. Laird
Brian A. Laird, SBN 020541
HEURLIN SHERLOCK LAIRD
1636 N. Swan Road, Suite 200
Tucson, AZ 85712-4096
Tel: (520) 319-1200 Fax: (520) 319-1221
Attorneys for Creditor Jame
As I have often typed..I would not believe anything that anyone at CDEX told me on the phone...or any other means of communications.
Seems that you have not read the filings..even that one that I just yesterday posted verbatim in part here.
The claim in the posting was that Poteet paid for the lawyer in the arbitration, and JR was a free rider. But the Q now is who is paying for his Lawyer in the BK??
While the arbitration was going on, JR used an alias to post here. That is the likely source of accusation that JR did some spying on the company. "THE BLOGS". Which may mean that what he posted here was pretty accurate.
Truth is hard to come by...but it is not to be found in your posts. The filings are somewhat more reliable. Because the LAWYER is not likely to tell any lies if he knows it. The JUDGE may not like it!! LOL!!
For a mere $20 K, you could buy a million shares!! CLOSER said that he borryed the money to make his big score. JOHN you no doubt, owning most of West Palm Beach..would not have to borry..
Sounds a lot like a sure thing to me..LOL!!
DISCLAIMER...I ain't no investment advisor. Further, I do not bleeve that the JUDGE will approve the plan. The shares will become totally worthless if CHAP 7 happens. none of the forward looking obsevasions that I just made are garunteed accurate...nor backward looking ones, for that matter. LOL!!
Hang tight KMRYP00..I saw where CLOSER, well known for the accuracy of his observations..such as "watch the volume" , @#$%^&* and TIA, etc, has "sorta" predicted a jump to a quarter a share as soon as the Judge grants JAYBEE his fondest desires, and lets him borry the money offa Mr Stewart and them over in the LUBBOCK area.
It is likely that a quarter won't make you whole...but that is bettern two cents. Of course you could average down..at 2 cents a crack...you could buy you a real stack of CEXI chips.
You too JOHN...
It has been said that CLOSER once hit LOCH for a million bucks jackpot..when it went way up to 5 bcks a pop. Even came out in a newspaper.. "GLTU"....
What I think about JR is not important.. The important thing to you is satisfying him so that he does not kick over a barrell of beans.
BTW, neither me nor anyone else here nor on other boards are impressed with old paid press releases.
Mr. Ryles is an unsecured creditor with a 0.98% pro rata share of all other unsecured
creditors. It is believed that he is attempting to drive the company out of business so that he can take
advantage of company trade secrets. If Mr. Ryles is allowed to succeed in his subterfuge, it will cost
the remaining 99.02% of unsecured creditors their investment and cause irreparable harm to
thousands of investors.
Wherefore, counsel for Debtor moves this Honorable Court to deny the Objections filed by
Mr. Ryles.
So you see, DEMMO, I do not really have to take STREETYS jumbled so called INFO for anything. Not that I would, anyway.
Eric Slocum Sparks
Arizona State Bar No. 11726
LAW OFFICES OF ERIC SLOCUM SPARKS, P.C.
110 South Church Avenue #2270
Tucson, Arizona 85701
Telephone (520) 623-8330
Facsimile (520) 623-9157
eric@ericslocumsparkspc.com
Attorney for Debtor
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ARIZONA
In re: ))
CDEX INC, ) Case No. 4:12-bk-02402-JMM
))
Chapter 11
)
Debtor. ) REPLY TO OBJECTION OF DEBTOR’S
) FORMER EMPLOYEE JAMES RYLES TO
))
1. DEBTOR’S APPROVAL OF DISCLOSURE
) STATEMENT, and
))
2. DEBTOR’S REQUEST
) FOR ORDER ALLOWING DEBTOR’S USE OF
) MONIES IN THE ORDINARY COURSE OF
) BUSINESS OPERATIONS
____________________________________)
Comes now CDEX, Inc., Debtor, Debtor-in-possession, by and through its undersigned counsel
and files this Reply to Objection of Debtor’s Former Employee, James Ryles, to 1). Objection [Doc. No.
89] to Debtor’s Approval of Disclosure Statement and 2). Debtor’s Motion for Use of Funds in Ordinary
Course of Business [Doc. No. 92]. In support of this reply, Debtor states as follows:
[color=red]1. Debtor filed its voluntary Chapter 11 petition on February 10, 2012.
2. Brain Laird, Esq. filed his application on behalf of Mr. Ryles on February 28, 2012 [Doc.
No. 18] and withdrew his representation due to a conflict with other creditors of Debtor whom he and
or his firm had represented.
3. Debtor filed a motion [Doc. No. 26] to allow Debtor to obtain post-petition financing on
a secured basis and held a hearing on April 2, 2012.
Case 4:12-bk-02402-JMM Doc 93 Filed 07/13/12 Entered 07/13/12 15:28:30 Desc
[/color]Main Document Page 1 of 6
The Court, at that hearing, denied Debtor’s request for financing on a secured basis and
advised Debtor it could utilize funds on an unsecured basis according to 11 USC §364 (a) for ordinary
course of business.
5. Debtor filed its Disclosure Statement and Plan of Reorganization [Doc. No. 70 and 71]
on May 25, 2012.
6. On June 1, 2012, Attorney Joseph Watson [Doc. No. 77 and 78] filed an appearance for
Mr. Ryles as his new attorney.
7. This counsel called Attorney Watson regarding his client, Mr. Ryles, former Employee
of Debtor. This counsel advised Mr. Watson that Debtor had no objection to proof of claim filed on
behalf of Mr. Ryles. Attorney Watson was to contact this counsel to reach stipulation on same.
8. This counsel placed two additional calls to Attorney Watson regarding his client’s claim
with no verbal response.
9. This counsel received the objections from Mr. Watson referenced herein.
Unsecured Creditor - Former Employee of Debtor
Mr. Ryles was employed at CDEX originally from December 2004 to May 2009 and again from
September 2010 through June 2011. Mr. Ryles’ May 2009 termination was a part of a general reductionin-
force where nine employees (including Mr. Ryles) out of a total of 17 employees were laid off. In June
2011, Mr. Ryles cancelled his consulting agreement with the company. Mr. Ryles’ duties comprised of
mapping boards, soldering and minor repair of existing products for service-related purposes, early stage
prototype configuration and assembly of new products.
After his original layoff, Mr. Ryles filed a complaint for discrimination alleging that the reason
for his termination was his unwillingness to participate in a Bible study that was held at the company
during a lunch hour. That complaint was dismissed in favor of CDEX. Mr. Ryles then was invited by Dr.
Poteet to be included in a collective lawsuit for past wages that previous management neglected to pay
to employees that were laid off. Dr. Poteet provided for most, if not all, of the expense to litigate the
matter and all of the other employees benefitted by Dr. Poteet’s generosity. This included Mr. Ryles.
The group prevailed in arbitration and was awarded attorney’s fees and three times the amount
Case 4:12-bk-02402-JMM Doc 93 Filed 07/13/12 Entered 07/13/12 15:28:30 Desc
of back wages that were not paid to the employees upon termination.
New Management
This was the final and key event that ushered in the new current management of Debtor and a
settlement agreement was made with the group of ex-employees. Attorney, Robert Fee, represented the
employees. Since that time, Attorney Fee has done work for the Debtor.
Mr. Ryles was offered a position with the company. Although other employees, Dr. Poteet, and
Mr. Starzinger agreed to take a 50% reduction in wages until the company was able to get into a positive
cash position, Mr. Ryles actually received an increase in his wages.
Settlement with Debtor
The ex-employees settled with the company, and agreed to be paid their actual back wages in
24 equal payments without any interest, and the settlement award of three times wages was to be
brought into the senior note, under the same provisions that all other collective note holders had.
Public Information
During Mr. Ryles’ time of employment, the company noticed information in various blogs that
discussed events in the company not of public nature, and the Debtor’s science team, Dr. Poteet, and
others, went to great lengths to scan the entire facility for bugs. After Mr. Ryles left the company,
there were no further reported leaks of confidential information. At the time of Mr. Ryles’ second
departure, CDEX was in compliance with its financial obligations to Mr. Ryles and continued to pay
Mr. Ryles regularly and on time for the 24-month non-interest-bearing note on actual back wages.
At the time of filing for relief under Chapter 11, the company had paid down $3,541.61 of the
$5,000.00 initial note due Ryles and had only $1,458.39 remaining. The undisputed amount owed to
Mr. Ryles of $32,920.24 consists of $21,148.00 initial award amount, plus $3,969.45 interest,
$6,344.40 for penalties for default provision, and the remaining $1,458.39 from his non-interest
bearing note.
Mr. Ryles through his new attorney, Mr. Watson, states that Mr. Ryles now does not want
stock in the reorganized company. Debtor does not dispute Mr. Ryles’ claim that he is a creditor of
the debtor.
Case 4:12-bk-02402-JMM Doc 93 Filed 07/13/12 Entered 07/13/12 15:28:30 Desc
Main Document Page 3 of 6
Ryles’s objections are not disclosure objections but plan objections.
Products Being Tested
Debtor currently has products being tested by potential clients and believes these products will
be purchased and leased which will generate additional monies for Debtor and can be used to fund
Debtor’s Plan of Reorganization.
Conclusion
Mr. Ryles is an unsecured creditor with a 0.98% pro rata share of all other unsecured
creditors. It is believed that he is attempting to drive the company out of business so that he can take
advantage of company trade secrets. If Mr. Ryles is allowed to succeed in his subterfuge, it will cost
the remaining 99.02% of unsecured creditors their investment and cause irreparable harm to
thousands of investors.
Wherefore, counsel for Debtor moves this Honorable Court to deny the Objections filed by
Mr. Ryles.
DATED: July 13, 2012
LAW OFFICES OF
ERIC SLOCUM SPARKS, P.C.
/s/ Sparks AZBAR #11726
Eric Slocum Sparks
Attorney for Debtor
Copies of the foregoing
mailed _____________ to:
Elizabeth C. Amorosi, Esq.
Asst. U. S. Trustee
United States Trustee
230 N. First Ave. #204
Phoenix, AZ 85003
Robert M. Charles, Jr., Esq.
Lewis and Roca, LLP
One South Church Ave., Suite 700
Case 4:12-bk-02402-JMM Doc 93 Filed 07/13/12 Entered 07/13/12 15:28:30 Desc
Main Document Page 4 of 6
Give me somthing to reply to. Is the VALIMED VERSION WHATEVR going to sell of not? You keep telling me what I said. I alrady know that. Who do you think paid JRs Lawyer?
Why did CDEX not respond to JRs request for discovery?
Wup..volume zero today...sorry about that HIGH...cannot jabber up a consistent roll.
Also JR won his disputed salary in arbitration. He has a court order to back up his claims.
Belittling RYLES (JR) may be the biggest blunder of the BK process up to now. Unless someone has paid him off (NOT AN UNKNOWN HAPPENING AT LOCH/CDEX).. he knows all or most of the secrets. Including the true potential of the various VALIMEDS.
Don't forget that his lawyer asked for some deep discovery that was agreed to by the Judge, but was never delivered. Not fully, anyway.
Also do not forget that discovery is generally asked for to confirm what is already known. Or to harrass the other side.
The BK court has approved the appointment of a new lawyer for the CALIFORNIA CHAP 7 Trustee. He is not required to have an ARIZONA Lawyer with him.
It is RYLES expectation that CDEX has the money to pay him what hs is owed. That is why he opposed giving BAXA back the money in the escrow account.
BAXA is now owned by a large corporation with deep pockets..and the true reason JB wants to return that escrow money is that he does NOT want to tangle with BAXTER.. But the court has not given him authority to return that money. And RYLES wants to be paid.
the court will decide.
The word FACT is badly misused. The word TRUTH has more meaning. Facts as presented here in your posts here are opinions and suppositions, yanked mostly out of thin air, easily found false by consulting the history of CDEX..
We need not review that history in its entirety here. Suffice to say that CDEX had not enough money to operate before the BK was started..and as of now not enough money to operate in the future.
JB got the number of shares increased by adding his illegal vote of shares that he no longer owned. But he failed to sell any PP shares, the main source of money received by previous CEOs.
He did raise some money by means of fraudently selling a blast of hot air to the SIGNATORIES...and selling the position of medical director to a LUBBBOCK doctor..for 50 K dollars.
NOT a steller record of achievement by the present CEO...to say the least
What really happened was that the 14, seeing that their money was gone, saw no reason to interfere if some fooles over there in LUBBOCK wanted to throw money into a hopeless cause. Maybe they could at least generate a P&D or somthing and give them a chance to sell their shares at a much better price.
The three, on the other hand, knowing full well that the VALIMED after so many years of tweaking, was not going to be a vehicle that would sell, were not willing to give up their claims to a BK and allow the LUBBOCKs to do a "lend to own" feat.
MP and RYLES along with WADE owns the patents to the myth gun.
They may not want to see that tech go over to the LUBBOCKS. They still have "Doctor" Wade in their pocket because of the patent..
So it could be that they want to salvage what is theirs, and after
the CHAP 7 do a new marketing scheme (SCAM) featuring the tech as applied to the MYTH gun.
But the above of course is speculation. but more reasonable than
the idea that they refused to cooperate out of pure evil cussedness.
But truly, there has to be more to it that that. Just what, is not yet clear.
Maybe a couple weeks???
Precisely, AMANITA..The loan to own scheme. The LUBBOCK bunch trying to own CDEX for a small loan..small compared to what it would take to keep CDEX operating for more than a few months.
The CDEX medical director and RS a large shareholder and PP salesman, is prominent in that LUBBOCK bunch.
JB lying like a SUMBICH about alla the VALIMEDs he is gonna sell this year iffin he gets the money.
He would be lucky to sell even ONE. On a trial basis.
IF IT IS ANY GOOD, HOWCOME IT HAS NEVER SOLD WELL???".
I will anticipate the reply from STREETY that it was because MP would not allow WADE to do the necessary to make it reliable.
WADE, whom it is now revealed is a co-collaborator with MP AND RYLES..two of the dispicable villians that has forced BK on pore old CDEX..WITH CEO JAYBEE, innocent and struggling with maximum might and main to cure the GREAT COMPANY that MP ruined into the brink of chap 7.
AND THE WORLD is expected to swallow that total BOOLSHEET..including the BK court??? PLEASE!!!!!!
Assuming for moment that your version is true...Then we are left with the latest version imagined up for VALIMED..A failed product from the past..dependent upon Wade for expertise in further development..
And the MYTH GUN in various versions...for which MP, WADE, and RYLES own the patent.
Then the bunch of LUBBOCK that want the entire company pledged to them in exchange for a small loan..and the other creditors not get anything. Except a remote and extremely unlikely result that the modified VALIMED...admittedly not yet completed, will sell very well indeed. Run up the SP, and allow the unsecured creditors to reap at least some part of their money by selling their shares..
Whereas, the impaired and unsecured creditors are assured that they will get nothing unless they vote to allow the LUBBOCKERS to make this small loan because that will force CHAP 7 on CDEX. CDEX cannot survive w/o money. BLACKMAIL!!
The KEY being WADE now outted as consorting with the "enemy", MP and RYLES. Further, WADE taking only a cursory interest in the activities in the LAB and working only part-time.
GOOD OLE WADE the one knowing better than anyone the technical aspects of the VALIMED ..Unless WADE can make it fly..nobody can.
A New "scientist" would require a LONG LEARNING CURVE far beyond the lasting power of the small loan from the LUBBOCKERS. And handicapped by a likely hard opinion that the VALIMED is an unreliable waste of time and money..and not enough of either.
"IF IT IS ANY GOOD, HOWCOME IT HAS NEVER SOLD WELL???".
IN THE MEANTIME...the present shareholders like the rest of the world..can only watch and wait. they have no vote.
Trouble is, I would not believe what any INONIT including you says on a phone..nor standin on a mile high stack of GOOD BOOKS.
But it seems that you are the only one with the nerve to comment here..and you almost never take a clear position.
My only comment at the moment is why blame MP and RYLES when CDEX was broke and had adequate reason to file BK w/o doing that?
The real reason they filed BK was because they really were BK!!
Accurate and to the point.
CDEX has gathered enough money over the years to hire real scientists and develope real products. Instead of squandering the money on junk that nobody wants to buy. And telling huge whoppers about the IMAGINARY capabilities of the junk.
YEP DEMMO...but actually CDEX ain't sold enough of the infringed product to make it worthwhile for ASD to worry about.
The ASD referred to in that post is a company.
http://www.asdi.com/
They have REAL, not IMAGINARY, WEASEL TALKED solutions for sale already...
So even if CDEX can make the VALIMED version whatever work, it cannot compete with an established company.
I dig. MALC, WADE and RYLES were still collaborating in MAR of this year. Submitted a patent together.
They got a lock on the MYTH Gun..which is probably why JAYBEE is pushing the VALIMED Version whatever.
Some subtle sub-currents flowing here. Thanks much for uncovering this one.
The court could use you to help investigate the technical aspects as to the likelihood that further development or tweaking is likely to result in salable products..that will be unique enough to actually be in demand.
FIRST DO NO HARM...
They claim to check the diluent. If there is a lethal amount of sodium chloride in the drip bag...will it catch it??
Can one discern the type and amount of a potentially lethal medicine in the bag by weight??
What it is is the usual BOOLSHEEET LIES by the CDEX INONITS.
The patented detection process identifies drug strengths and volume-by-weight in real-time, validating proper dose, diluents and concentration of high-risk compounded medications and treatment solutions.
I note that CEXIQ is still trading a bit. Therefore, anyone wishing to buy shares can most likely do so. Regardless of the reason.
I have not inquired of anyone that why they would buy. If they want to buy, it will not put them in the poorhouse. Not at the present SP and volume.
So ANYONE...If you feel the urge to buy..go for it!! OK??
There could be a minor P&D before the Court rules. If by chance the court should rule in a way that favors JAYBEE and he gets to borrow from the LUBBOCK bunch...then a slightly higher P&D could result.
Can you count on that?? I say no. Can you count on CDEX becoming a power in the future, sell a lot of stuph and thus a viable long term investment? I laugh and say HECK NO!! LOL!!
Which reminds me of a saying I use from time to time "A wise man changes his mind, a fool never will."
History shows that is was NEVER the bashers that removed those who needed removing. It was shareholders who stepped forward and took action and changed the management team's.
Weel now leta see...since sept 2010 CDEX has gone from a plain old SCAM that was short of operating money and whose shares were going for around 5 cents a crack to to a BK SCAM whose shares are going for around 1.5 cents a crack. And now even shorter of money.
From a company that enjoyed support from existing shareholders to a company where a good word in favor of it from shareholders is rare indeed.
From a company that had nearly 100M shares in the treasury to nearly zero shares in the treasury...then voted 300 M additional shares using the vote of the CEO of shares he claimed to have but did not.
From a company that could borrow on shares or sell PP shares to a company that cannot. Despite the additional shares that they voted for themselves using the aforementionned CEO shares that he did not own.
From a plain vanilla SCAM selling the odd thing now and again from the existing product catalog to selling a non-existant distributership to some SIGNATORIES and fraudulently claiming that the hot air they sold is "PRODUCT" on an oficial SEC report.
There is more, but that is enough for now. YEP the shareholders should be proud indeed of the FINE record that the current management has managed. HAIL TO THE NEW CEO..well not exacly new now...LOL!!
Sorry KID, etc. cannot blame CDEX on anyone but CDEX. They got money from PP holders and lenders. Squandered and spent it.
They cannot blame any bashers. Cannot blame any Investors. Cannot blame any TOUTS. Cannot blame BAXA. Can only blame the INONITS.
History has shown the bashers were spot on all the time. So certainly cannot blame them. BTW, I do believe that you and the CAP'N made lotsa posts here too..also MOONEY.
Yep..they are humming along alright!! LOL!!
Mark your words. One day...everybody will be SOOOOOO proud that they went and bought some shares!!
Even maybe you!!
Who can best determine if the latest version of Valimed will sell or not? How about MP and GEMINI?? With BAXA et al who were distributors, nationally and internationally.
Maybe GOOD OLE JIM?? No. Not him. Nobody can believe him after he made his history with CDEX, and tied his star to them by becoming
a member of the BOD and taking shipment of the latest Valimed version. "FOR EVALUATION" LOL!!
The point is, BAXA GEMINI and MP can form a cabal or group and buy CDEX out IF THEY THOUGHT that the product will sell. The LUBBOCK bunch if nothing else have established the going price..something less than 800 K. Lock stock and the barrells.
What is YOUR opinion?? Do you think that MP and GEMINI will do that...along with BAXA et al?? I say heck no...THEY KNOW THAT THE CDEX PRODUCTS WILL NOT SELL!!
(They would have to get the court to agree).
My nomination for the truest statement of the year, buried amongst the other stuff in GEMINIs objection. (referring of course to JAYBEE) shown in red below...
But his say-so is no substitute for actual evidence. See In
re 495 Cent. Park Ave. Corp., 136 B.R. 626, 630-31 (Bankr. S.D.N.Y. 1992) (“[T]he
debtor must make an effort to obtain credit without priming a senior lien.”).
Here is Gemini objection to the CDEX emergency request for immediate funding, on 22 march last. JAYBEE had counted on his "status" as a "debtor in possession" (DIP) to sneak this one by the court. So he pulled the same stuff that he as used on shareholders..Gave vague declarations which can be disclaimed..and expected the court to agree that he has to get the money PDQ if he is to remain in business..And that the unsecured shareholders would be best served if he could just go ahead and make a BIGGGGGG pile of money offa VALIMED VERSION 4.
GEMINI objected giving their reasons below. CDEX supposedly "cured" the source of the money objection..finally telling where the money was to come from, and putting some funds into an equity account to show the court..though well below the million and a half that they first cited as the amount "expected"
to get.
The court declined to let them connsumate the loan, postponing that question until the main hearing. Will GEMINI now vote to approve the JAYBEE "plan"?? The have nothing to lose by doing so, becasuse CDEX is worthless to them as an "unsecured" creditor. Nor do they have anything to gain if the court moves the BK from a Chap 11 to a Chapter 7.
Tucson, Arizona 85701-1611
Telephone: (520) 622-2090
Robert M. Charles, Jr., State Bar No. 007359
Direct Dial: (520) 629-4427
Direct Fax: (520) 879-4705
EMail: RCharles@LRLaw.com
Jeffrey L. Sklar
Email: JSklar@lrlaw.com
Attorneys for Gemini Master Fund, Ltd.
UNITED STATES BANKRUPTCY COURT
DISTRICT OF ARIZONA
In re:
Case No. 4:12-BK-02402-JMM
CDEX INC.,
Chapter: 11
Debtor.
Response to Debtor’s Emergency Motion
for Authority to Obtain Interim and
Long-Term Debtor in Possession
Financing
Date: March 22, 2012
Time: 1:30 p.m.
Creditor Gemini Master Fund, Ltd. (“Gemini”) opposes Debtor’s Emergency
Motion for Authority to Obtain Interim and Long-Term Debtor in Possession Financing
(“Motion”) (Dkt. #26).
Introduction
On just two days notice, Debtor is seeking the Court’s approval to encumber all of
its assets with a post-petition senior lien for up to $1 million.1 The Motion offers no
explanation of its failure to comply with Rule 4001(c)(3), which requires a debtor to
provide 14 days notice before obtaining credit, except in emergency situations. Nor has it
explained why this case presents an emergency.
1 An affidavit from Debtor’s CEO filed late on March 21 suggests that the lien may
actually be for $1.5 million. See Dkt. #31, ¶ 6.a. Of course, whether the lien is for $1
million or $1.5 million is a question that should be answered prior to the day before the
hearing.
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More importantly, the Motion leaves numerous questions unanswered about the use
of the funds that are being requested, the structure of the financing, Debtor’s profitability,
and whether Debtor has complied with the applicable securities laws. Given that the
proposed senior lien could eviscerate any recovery by unsecured creditors if the
reorganization is unsuccessful, Debtor’s failure to provide this information is especially
prejudicial to the creditors.
To be clear, Gemini is not categorically opposed to Debtor obtaining financing.
But before it can determine whether to support or oppose this particular financing request,
Debtor should be required to provide more information about how the financing will be
used. At a minimum, the Court should reset the hearing for sometime after the 14-day
notice period in Rule 4001.
Facts
Debtor filed its Chapter 11 petition more than a month ago, on February 10, 2012.
Its schedules indicate that it has about $425,000 in assets and more than $2.8 million in
liabilities. Dkt. #1 at 8. The assets are primarily in the form of intellectual property,
equipment, and inventory. Id. at 13. The liabilities are all unsecured, and Gemini is the
largest creditor, with a claim Debtor has valued at about $927,000. Id. at 22. Until now,
Debtor has not asked the Court to approve any interim or long-term financing. Debtor has
not yet filed an operating report. Nevertheless, without warning, Debtor filed this Motion
on March 20 and asked for a hearing just two days later.
The Motion provides virtually no detail about the financing. It simply claims that
unnamed “qualified investors may loan debtor monies in a series of transactions totaling
up to one million dollars.” Motion at 4. It also states that the investors — whoever they
are — will “require that they be granted a senior lien against the assets owned by Debtor,”
which would be capped at $1 million. Id. Because Debtor has claimed that its assets total
only about $425,000, this would be a lien against every asset currently held by Debtor for
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more than double their value. The Motion fails to acknowledge this, let alone explain why
it is necessary.
In fact, the Motion fails to explain how the financing will be used. It simply asserts
that it will help prepare Debtor’s product, and it makes the unsupported claim that Debtor
has received a large number of requests for that product. Id. at 3. But it provides no detail
about precisely how the product will be prepared, how many requests have been received,
and how much money is necessary to bring the product to market. Moreover, although an
affidavit from Debtor’s CEO filed late on March 21 suggests that the funds will be used to
pay routine expenses such as payroll, it does not explain how much money is actually
necessary to keep Debtor functioning. Dkt. #31 ¶ 11.
Nor does the Motion explain whether the financing will be sufficient to make
Debtor profitable, which is the only way the unsecured creditors’ interests could be
protected against a senior lien on all Debtor’s assets. It simply makes the bald assertion
that if the Motion is granted, “the interests of all unsecured creditors would remain more
than adequately protected by the development of its products.” Motion at 5.
The motion leaves numerous other basic questions unanswered as well. For
example, while it claims that the financing would be in the form of debt that would be
convertible to equity, it provides virtually no detail about this transaction. It simply
attaches a promissory note with numerous blanks remaining, along with a similarly blank
financing agreement, subscription agreement, and other documents. The promissory note
states that if Debtor exits bankruptcy, the debt will be convertible to equity at $0.05 per
share. The Motion fails to explain whether or how this offering would comply with the
federal and state securities laws.
Argument
As Debtor’s Motion acknowledges, the Court cannot authorize lending in exchange
for a superpriority lien under Section 364(d) unless the debtor has proven that no other
financing was available and has demonstrated the existence of adequate protection. In re
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Plabell Rubber Products, Inc., 137 B.R. 897, 901 (Bankr. N.D. Ohio 1992). Debtor has
failed to prove anything, let alone meet these requirements. Debtor simply asserts that it
could not obtain financing without providing a senior lien. And the CEO’s affidavit states
that Debtor unsuccessfully sought financing from lending institutions and private
individuals. Dkt. #31 ¶¶ 13-14. But his say-so is no substitute for actual evidence. See In
re 495 Cent. Park Ave. Corp., 136 B.R. 626, 630-31 (Bankr. S.D.N.Y. 1992) (“[T]he
debtor must make an effort to obtain credit without priming a senior lien.”).
Before the Court can find that either of Section 364(d)’s requirements have been
satisfied, it should require Debtor to demonstrate at least: (1) who the investors are and
their ability to provide the financing; (2) other efforts Debtor made to secure financing;
(3) Debtor’s current profitability; (4) Debtor’s expected profitability after obtaining the
financing; (5) who has expressed interest in Debtor’s product; (6) how the creditors will be
adequately protected; (7) what the funds will be used for; (8) what the terms of the
financing are; and (9) whether the financing arrangement complies with the applicable
securities laws. Such evidence is especially important because the senior lien Debtor
seeks would cover all its assets and could wipe out the unsecured creditors if Debtor’s
reorganization efforts are unsuccessful.
At a minimum, Debtor should be required to provide the 14-day notice required
under Fed. R. Bankr. P. 4001(c)(3) to obtain credit. This is especially true because
nothing in Debtor’s Motion demonstrates that the estate will suffer “immediate and
irreparable harm” if the financing is not authorized sooner. See Fed. R. Bankr. P.
4001(c)(3).
Conclusion
To be clear, Gemini is not categorically opposed to Debtor obtaining financing.
But this request fails to include a great deal of important information. The Court should
require that this information be provided. At a minimum, it should require that the hearing
be reset for sometime after the 14-day notice period set forth in Rule 4001.
4 2782410.1
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DATED this 21st day of March, 2012.
LEWIS AND ROCA LLP
By /s/ Jeffrey L. SklarRobert M. Charles, Jr.
Jeffrey L. Sklar
Gemini Master Fund, Ltd.
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Proof of Service
COPY of the foregoing served via the Court’s ECF system and by email on March 21,
2012 to each of the parties listed below, and via first class mail, postage prepaid, addressed
as follows where no email address is listed:
Eric Slocum Sparks
Eric@ericslocumsparkspc.com
Law Offices of Eric Slocum Sparks, P.C.
110 South Church Avenue, #2270
Tucson, AZ 85701
Attorney for Debtor
Elizabeth C. Amorosi
Elizabeth.C.Amorosi@usdoj.gov
Assistant United States Trustee
230 North First Avenue, Suite 204
Phoenix, AZ 85003-1706
Brian A. Laird
Heurlin Sherlock Laird
1636 North Swan Road, Suite 200
Tucson, AZ 85712-4096
blaird@hslazlaw.com
/s/ Renee L. Creswell
Renee L. Creswell
Lewis and Roca LLP
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