Cdex, Inc. (fka CDEX)

[Crow3]

"Loan to own" came from a motion from the trustee, who obviously saw what was afoot.

The ANGELS were to loan up to 1.5 million to allow CDEX to continue with the CEO as Debtor in possession. (DIP).

Thus would allow CDEX to stay open and avoid chap 7. And leave the ANGELS with dibs.

Without a budget in place, a proposed interest rate of 12% that must be paid to avoid post-petition default, and the lack of historical financial performance by this Debtor, the U.S. Trustee is concerned that the proposed financing is merely a shield for a
potential “loan to own” scheme by investors\creditors who are lying in wait.

(From the filing made by the Trustee).

I think that's why the Lubbock, TX investment group will only loan money against a senior lienhold- if CDEx were to default on the loan the investment group gets everything.

From a post by DIDDY that was dead on.