Internal Fixation Systems, Inc.(fka IFIXQ)

[boommer]

N SYSTEMS, INC,
Debtor. /
Case No.: 12-39145-RAM
Chapter 7
CHAPTER 7 TRUSTEE’S EMERGENCY MOTION FOR ENTRY
OF AN ORDER (I) AUTHORIZING THE SALE OF CERTAIN ASSETS
FREE AND CLEAR OF ALL LIENS, CLAIMS, ENCUMBRANCES
AND INTEREST AND (II) APPROVING THE CONTRACT FOR SALE TERMS
Basis for Emergency Relief
The Trustee respectfully requests an expedited hearing on this matter at the
Court’s first available date in order to secure the value of the Sale and Purchase
Agreement (the “Agreement”) executed by and between the Trustee and MXD,
Inc. (the “Purchaser”). The Purchaser requires that the Trustee file this motion
(the “Motion”) immediately so that the corporate shell which is the subject of the
proposed sale is not delisted by the SEC prior to closing, rendering it worthless to
the Purchaser. Further, because the proposed sale transaction represents the
Trustee’s best opportunity to monetize this asset for the benefit of its creditors, the
Trustee submits that sufficient cause exists for the Court to hear this matter on an
expedited basis. The Trustee respectfully requests that the Court waive the
provisions of Local Rule 9075-1(B), which requires an affirmative statement that
a bona fide effort was made in order to resolve the issues raised in this Motion, as
the relief requested herein is urgent in nature and does not lend itself to advance
resolution.
NOTICE TO SHAREHOLDERS: Notice is hereby provided to all known
shareholders of Internal Fixation Systems, Inc. that the Trustee is seeking to sell
the corporate shell of Internal Fixation Systems, Inc. to a third party purchaser.
Conversion rights of any kind, including without limitation, warrants, options,
convertible bonds other convertible debt instruments, with the exception of
convertible preferred stock, will be terminated by the entry of an order
approving this motion. Parties seeking to oppose the proposed sale set forth in
this motion are directed to file an objection with the Court or appear at the
expedited hearing to be set on this matter.
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 1 of 18
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EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive · Suite 300 · Miami, FL 33131 · T. 305.722.2002 · F. 305.722.2001 · www.ecclegal.com
Jacqueline Calderin, Chapter 7 Trustee (the “Trustee” or the “Seller”) of the bankruptcy
estate (the “Estate”) of Internal Fixation Systems, Inc. (the “Debtor”), by and through
undersigned counsel, and pursuant to 11 U.S.C. §§ 363 (b) and (f), Bankruptcy Rule 6004(f)(1)
and Local Rule 2016-1(A), moves this Court for the entry of an order (the “Sale Order”)
authorizing the sale of the Debtor’s corporate shell via private sale to the Purchaser free and clear
of liens and encumbrances, if any (the “Sale”). In support of the Motion, the Trustee states as
follows:
JURISDICTION
1. This Court has jurisdiction over this case pursuant to 28 U.S.C. §§ 157 and 1334.
This matter is a core proceeding pursuant to 28 U.S.C. § 157(b). Venue is proper in this District
pursuant to 28 U.S.C. §§ 1408 and 1409.
2. The statutory predicates for the relief requested herein are section 105 and 363(f)
of the Bankruptcy Code.
BACKGROUND
3. On December 5, 2012 the Debtor initiated this matter by filing a Voluntary
Petition for relief under Chapter 7 of the Bankruptcy Code [ECF #1].
4. Through this Motion, the Trustee seeks to sell the Debtor’s corporate public shell
(the “Asset”), which is listed as an active reporting company with United States Securities and
Exchange Commission (the “SEC”).
5. The Debtor is a public entity and upon information and belief, has 200,000,000
shares of common stock authorized and approximately 54,799,367 shares of common stock
issued and outstanding.
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 2 of 18
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EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive · Suite 300 · Miami, FL 33131 · T. 305.722.2002 · F. 305.722.2001 · www.ecclegal.com
6. Additionally, upon information and belief, the Debtor has 50,000,000 shares of
authorized preferred stock, of which 5,000,000 shares issued and outstanding.
7. During the pendency of this Chapter 7 case, multiple parties expressed an interest
in bidding for the Asset, but the Trustee received no firm offers other than that of the Purchaser.
The Purchaser has offered to purchase the Asset for the total purchase price of Twenty-Five
Thousand Dollars and 00/100 ($25,000.00).
8. The Trustee has administered all other Estate assets and was in the process of
preparing her final report when the Purchaser submitted its offer to purchase the Asset.
Accordingly, the Trustee requests authorization from this Court to sell the Asset to the Purchaser
on an as-is, where-is basis for the total purchase price of $25,000.00. Attached hereto as Exhibit
“A” is the Sale contract (the “Contract”).
9. As per paragraph 6 of the Contract, this Motion requests the entry of an order in
substantially the same form as that attached as Exhibit “B” which authorizes the Sale of the
Asset free and clear of all liens, claims and interests under 11 U.S.C. Section 363, and orders
and/or finds as follows:
a. that the Trustee is authorized to sell and the Purchaser authorized to purchase the
Asset free and clear of all liens, claims and interests under 11 U.S.C. section 363(f);
b. that any and all interests the Debtor may have in any real or personal property,
excluding the corporate shell of Debtor, shall remain in the Estate for further
administration under the Bankruptcy Code, and shall no longer be owned or
controlled by the Debtor;
c. finding that pursuant to 11 U.S.C. section 363(m), the purchase of the Asset under the
Contract is in good faith and that the Purchaser is a good faith purchaser entitled to
the protections of 11 U.S.C. section 363(m);
d. that upon the Sale closing, the Debtor’s existing officers and directors will be deemed
removed from office;
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 3 of 18
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EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive · Suite 300 · Miami, FL 33131 · T. 305.722.2002 · F. 305.722.2001 · www.ecclegal.com
e. that upon the Sale closing, the Trustee is authorized to deliver to the Purchaser a stock
power assigning, conveying and otherwise transferring the total issued and
outstanding convertible preferred stock of the Debtor to Purchaser (the “Convertible
Preferred Stock”) to the extent that the Debtor is the holder of any currently issued
and outstanding convertible preferred stock of the Debtor (the “Stock Power”);
f. that all common share conversion rights of any kind, including without limitation,
warrants, options, convertible bonds other convertible debt instruments, with the
exception of the Convertible Preferred Stock, be cancelled;
g. that within ten (10) days of the date of closing, the Purchaser shall be authorized to
appoint a new board of directors; and
i. issue up to 140,000,000 shares of common stock to the Purchaser
or its assignees;
ii. implement a reverse split of the issued and outstanding common
stock in a ratio of approximately 5,000 to 1 or in a ratio further
determined by the board of directors;
iii. alter, amend and otherwise change the rights and preferences of
any holder(s) of the Convertible Preferred Stock, including,
specifically, the ratio at which each share of the Convertible
Preferred Stock may be converted into the common stock; and
iv. cause any and all reasonable actions to be taken to preserve the
Debtor’s listing on the Over the Counter QB or Pink Sheets
Marketplace, including, specifically, the filing of an SEC Form 15,
should it be deemed advisable.
10. Pursuant to the terms of the Contract, the Purchaser understands that the granting
of these requests is within the power of the Bankruptcy Court, but that not all of the requests may
be granted. The Bankruptcy Court’s granting of the requests set forth in subparagraphs (a)
through (g) are the conditions precedent to closing of this Sale, unless the Purchaser elects to
close despite the Bankruptcy Court’s failure to grant some of the requests.
11. Pursuant to the Contract, the Purchaser has delivered to the Trustee an earnest
money deposit in the sum of $5,000.00, as required by the Contract. After the entry of an order
approving the Sale, the closing of the Sale shall occur on the first business day that is at least 7
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 4 of 18
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EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive · Suite 300 · Miami, FL 33131 · T. 305.722.2002 · F. 305.722.2001 · www.ecclegal.com
days after the entry of the Sale Order. At closing, the Trustee shall provide the Purchaser with a
certified copied of the Sale Order, and all corporate books and records, other than operational
books and records, in the Trustee’s possession (if any).
BASIS FOR RELIEF REQUESTED
12. In her business judgment, the Trustee has determined that the Sale price is fair
and reasonable, and that it is in the Estate’s best interest to sell the Asset via private sale to the
Purchaser on an “as-is, where-is” basis, without any representations or warranties of any nature.
Upon information and belief, based upon the Trustee’s review of the Debtor’s books and public
records searches, the Debtor owns the Asset free and clear of all liens, claims, encumbrances,
and interests; however, in an abundance of caution, in the event that there any existing liens of
which the Trustee is unaware, the Trustee wishes to sell the Asset pursuant to §363(f), free and
clear of any existing liens.
13. Pursuant to 11 U.S.C. § 363(b)(l), “the Trustee, after notice and a hearing, may
use, sell, or lease, other than in the ordinary course of business, property of the estate.”
14. Courts interpreting section 363(b)(l) have held that under section 363(b)(l), a sale
should be approved when (a) supported by the sound business judgment of the debtor’s
management; (b) interested parties are provided with adequate and reasonable notice; (c) the sale
price is fair and reasonable; and (d) the purchaser is acting in good faith. See In re Delaware and
Hudson Ry. Co., 124 B.R. 169 (D. Del. 1991); In re Phoenix steel Corp., 82-B.R. 334, 335-36
(D. Del. 1987).
15. The requirements of 11 U.S.C. § 363(b)(1) are satisfied by the facts of this case.
The proposed Sale is supported by the Trustee's sound business judgment due to the Trustee’s
belief that the Estate will not otherwise realize a greater recovery. Specifically, the Trustee was
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 5 of 18
in the process of preparing this case for its final report when the Purchaser submitted its bid.
During the pendency of the Chapter 7 case, multiple third parties expressed interest in making a
bid for the corporate shell, but every potential offer fell through after the proposed bidder
completed its due diligence. The Purchaser is the only third party, independent bidder whose
offer has survived due diligence and has met the Trustee's requirements. The Sale offer has been
the result of the unrelated parties' arms length business negotiations. Accordingly, as required by
the Contract, the Trustee seeks a finding from the Court that the Purchaser is entitled to a
§363(m) good faith purchaser designation and related protections.
16. The Trustee believes that the Sale to the Purchaser will provide the highest and
best liquidation value for the Asset without the need to incur additional administrative expenses.
WHEREFORE, the Trustee respectfully requests the Court's entry of the Sale order,
substantially in the form of the proposed order attached as Exhibit B: (i) granting this Motion;
(ii) approving the Sale of the Asset to the Purchaser; (iii) approving the form of the Contract and
essential terms thereto (iv) finding that the Purchaser is entitled to 11 U.S.C §363(m) good faith
purchaser protections, and (v) providing any further relief that the Court deems just and proper
given the circumstances.
Respectfully submitted thismctay of July 2015.
EHRENSTEIN CHARBONNEAU CALDERIN
Counsel for the Trustee
501 Brickell Key Drive, Suite 300
Miami, Florida 3 3131
T. 305. 722.2002 F. 305. 722.2001
By: /s/ Christopher Spuches
6
Christopher Spuches, Esq.
Florida Bar No: 42456
[e-mail]
EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive· Suite 300 ·Miami, FL 33131 · T. 305.722.2002 ·F. 305.722.2001· www.ecclegal.com
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 6 of 18
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EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive · Suite 300 · Miami, FL 33131 · T. 305.722.2002 · F. 305.722.2001 · www.ecclegal.com
Exhibit “A”
Contract
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 7 of 18
CONTRACT FOR SALE AND PURCHASE OF
INTERNAL FIXATION SYSTEMS INC . CORPORATE SHELL
This agreement is a Contract for sale and purchase between
Jacqueline Calderin , trustee of the Chapter 7 bankruptcy estate of
Internal Fixation Systems, Inc ., a Florida corporation , ( "Seller " )
and MXD , Inc ., a Colorado Domestic for Profit Corporation
( " MXD" ) , ( " Purchaser " ) , dated this 13th day of July , 2015 .
RECITALS
WHEREAS , on December 5 , 2012 , Internal Fixation Systems, Inc .,
(hereinafter " IFIX") filed its petitionwith the United States
Bankruptcy Court , Southern District of Florida (the "Bankruptcy
Court " ) for relief under Chapter 7 of the United States Bankruptcy
Code , case no . 12 - 39145 - RAM ;
WHEREAS , Purchaser is interested in purchasing the public shell
of IFIX , that is a reporting company with the United States
Securities and Exchange Commission (the " SEC") ;
WHEREAS , according to Purchaser, IFIX is a public entity and has
two hundred million (200 , 000 , 000) shares of common stock authorized
and approximately 54 , 799 , 367shares of common stock issued and
outstanding ;
WHEREAS , according to Purchaser, IFIX has fifty million
(50 , 000 , 000) shares of preferred stock authorized , of which there are
five million (5 , 000 , 000) shares issued and outstanding ; and
WHEREAS , Seller wishes to sell and Purchaser wishes to purchase
a certain asset , the corporate shell of IFIX free and clear of all
liens, claims and interests pursuant to the terms and conditions set
forth herein and subject to Bankruptcy Court approval .
NOW , THEREFORE , for good and sufficient consideration , as set
forth hereunder , it is agreed by Seller and Purchaser as follows :
1 . Parties . The parties to this transaction are Seller and
Purchaser.
2 . Sale of Asset . Subject to all conditions and terms set
forth herein , Seller shall sell and Purchaser shall purchase the
corporate shell of IFIX free and clear of all liens, claims, and
interests (the "Asset " ) . The sale is subject to Bankruptcy Court
approval . Seller shall send notice of the proposed sale to all
creditors on the bankruptcy mailing matrix and to other parties who
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 8 of 18
have expressed an interest in possibly purchasing the Asset . The sale
is also subject to any other offers which Trustee , in her discretion ,
determines to be a better offer . Trustee shall be entitled to
schedule and conduct an auction (the "Auction " ) in connection with
the sale of the Asset .
3 . As Is Where Is . The Asset shall be sold " as is, where is "
without representation or warranty of Seller as to good
standing , reinstatement of good standing , adequacy or timeliness of
filing requirements (whether state or federal , including the SEC , the
State of Florida , or any other governmental unit) , or any other
filing or compliance actions, or the type or number of outstanding
shares . The Asset does not include any interest in any real or
personal property of any nature , including any ownership position
with respect to any subsidiaries .
4 . Consideration and Deposit . The purchase price for the Asset
is $2 5 , 000 (the "Purchase Price") . Of the Purchase Price , MXD shall
pay and be responsible for the purchase price in its entirety .
Contemporaneous with Purchaser's execution of this Agreement , MXD has
provided Seller with a $5 , 000 deposit (the " Deposit " ) . The Deposit
shall be held by Seller in a segregated account . If Purchaser is not
the successful bidder at the Auction or the Bankruptcy Court does not
approve the sale of the Asset to Purchaser, then Seller shall
promptly return the Deposit to Purchaser . If the sale of the Asset to
Purchaser is consummated , then the Deposit shall be credited to the
$25 , 000 purchase price (or such higher purchase price if Purchaser
agrees to a higher purchase price at the Auction) . If Purchaser
defaults under this Agreement , then Seller shall be entitled to keep
the Deposit and apply it against any damages Seller may have .
5 . Production of Corporate Books and Records . Upon execution
of this Agreement, Seller shall use his best efforts to make
available to Purchaser any and all corporate books and records of
IFIX exclusive of any operational books and records, that Seller
maintains or has access to , however, Seller makes no representations
or warranties as to the existence , contents, or accuracy of the books
and records . It is acknowledged that Seller, as the trustee of the
IFIXbankruptcy estate , did not prepare or produce the corporate books
and records, and that Seller merely maintains those books and records
produced and turned over to her by IFIX . Purchaser acknowledges the
existence of public filings with the SEC prior to the chapter 7
petition date , and acknowledges that neither the adequacy and
sufficiency of corporate books and records nor the adequacy or
sufficiency or timeliness of IFIX's SEC filings shall be a condition
precedent to the closing of this transaction.
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Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 9 of 18
6 . Bankruptcy Court Order . Within seven days after execution
of this Agreement , the Seller shall file with the Bankruptcy Court a
motion for an order authorizing the sale of the Asset free and clear
of all liens, claims and interests under 11 U. S . C. section 363 (the
"Motion " ) . The Motion shall request the entry of an order in
substantially the same form as that attached as Exhibit A hereto and
include the following findings (the " Order " ) , but Purchaser
understands that the granting velnon of such requests is within the
power of the Bankruptcy Court and that all requests may not be
granted . The granting of the requests set forth in subparagraphs (a)
through (e) , by the Bankruptcy Court , shall be conditions precedent
to closing of this sale unless Purchaser chooses to close despite the
Bankruptcy Court ' s failure to grant some of the requests .
(a) That Seller shall be authorized to sell and Purchaser shall
be authorized to purchase the Asset free and clear of all liens,
claims and interests under 11 U. S . C. section 363(f) ;
(b) That any and all interests IFIX may have in any real or
personal property , excluding the corporate shell of IFIX , shall
remain in the IFIXbankruptcy estate for further administration under
the Bankruptcy Code , and shall no longer be owned or controlled by
IFIX ;
(c) That there be a finding pursuant to 11 U. S . C. section 363(m)
that the purchase of the Asset under this agreement is in good faith
and that the Purchaser is a good faith purchaser entitled to the
protections of 11 U. S . C. section 363(m) ;
(d) That upon closing , the existing officers and directors of
IFIX will be deemed removed from office ;
(e) That upon closing , the Seller shall deliver to MXD , Inc . a
stock power in substantially the same form as that attached as
Exhibit B hereto assigning , conveying and otherwise transferring the
total issued and outstanding convertible preferred stock of IFIX to
Purchaser (the ''Convertible Preferred Stock") to the extent that IFIX
is the holder of any currently issued and outstanding convertible
preferred stock of IFIX(the " Stock Power " ) ;
(f) That all common share conversion rights of any kind ,
including without limitation , warrants, options, convertible bonds
other convertible debt instruments, with the exception of the
Convertible Preferred Stock , be cancelled ;
(g) That within ten (10) days of the date of closing (the
"Closing Date " ) , the Purchaser shall be authorized to appoint a new
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II
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 10 of 18
board of directors of IFIX ; and
(e) That within ninety (90) days following the Closing Date , the
newly appointed board of directors of IFIX shall be authorized to :
(i) Issue up to 140 , 000 , 000 shares of common stock to MXD
or its assignees;
( ii) Implement a reverse
outstanding common stock in a
to 1 or in a ratio further
directors;
split of the issued and
ratio of approximately 5 , 000
determined by the board of
(iii) Alter, amend and otherwise change the rights and
preferences of any holder ( s) of the Convertible Preferred
Stock , including , specifically, the ratio at which each
share of the Convertible Preferred Stock may be converted
into the common stock of IFIX ; and
( i v) cause any and all reasonable actions to be taken to
preserve IFIX ' s listing on the Over the Counter QB or Pink
Sheets Marketplace , including , specifically, the filing of
an SEC Form 15 , should it be deemed advisable .
7 . Closing. After the entry of an order approving the sale of
the Asset , closing of the sale shall occur on the first business day
that is at least 7 days after the entry of the sale order (the " Sale
Order " )
8 . Closing Conditions : Seller.
provide Purchaser with the following :
At closing ,
(a) A certified copy of the SaleOrder; and
Seller shall
(b) All corporate books and records, other than operational
books and records , in the possession of Seller, if any .
9 . Closing Conditions : Purchaser . The obligation of Purchaser
to consummate the transaction contemplated herein is subject to the
following :
(a) Approval by the Bankruptcy Court of the sale of the Asset to
Purchaser.
10 . Choice of Law . This agreement shall be governed by the
internal laws (and not the law of conflicts) of the State of Florida .
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Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 11 of 18
11 . Severability and Operation of Law . If any provision of this
agreement is prohibited by the laws of Delaware or, for any reason ,
any other applicable jurisdiction , the agreement shall be deemed
ineffective to the extent only of such provision and shall be deemed
modified to conform with such laws , without invalidating the
remaining prov isions; and any such provision in any jurisdiction
shall not invalidate such provision in any other jurisdiction .
12 Entire Agreement ; Modification . This agreement embodies the
entire agreement and understanding of the parties and supersedes any
prior agreements, arrangements and understandings related to the
matters provided in this agreement . No modification , alteration ,
waiver, amendment, change or supplement to this agreement shall be
binding or effective unless it is set forth in writing , signed by an
authorized representative of each party .
13 . Survival and Binding Agreement . The terms and conditions of
this agreement shall survive the closing and shall inure to the
benefit of and be binding up on the part ies and their respective
heirs, personal representatives, successors and assigns .
14 . Assignment . Neither party to this agreement may assign any
of its rights or delegate any of its responsibilities under this
agreement .
15 . Termination . In addition to the right of
terminate this Agreement as set for elsewhere herein ,
may be terminated at any time , by mutual agreement
Purchaser .
the parties to
this Agreement
of Seller and
16 . Notices . All notices, requests, demands , claims
communication under this agreement must be in writing .
notice , request , demand , claim or other communication shall
given if sent by personal deli very , overnight carrier or
transmission as follows :
(a ) If to Seller:
Jacqueline Calderin , Trustee
(b) With a copy to :
Robert P . Charbonneau
s
and other
Any such
be deemed
by email
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 12 of 18
(c) If to Purchaser :
MXD , Inc .
ATTN : Chris Lotito
1112 Oakridge Drive Unit 104
Fort Collins, CO 80525
(d) With a copy to :
Adam S. Tracy
Securities Compliance Group Ltd .
520 W. Roosevelt Ste #201a
Wheaton , IL 60187
Email : at@ibankattorneys . com
17 . Counterparts . This agreement maybe executed in one or more
counterparts, each of which shall be deemed an original but all of
which together shall constitute a fully executed agreement .
/ \
Calderin , as Trustee
Chapter 7Bankruptcy
estate of Internal Fixation
Systems, Inc .
MXD , Inc .
By :Chris Lotito
Its : President
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Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 13 of 18
IRREVOCABLE STOCK POWER
FOR VALUE RECEIVED, the undersigned does (do) hereby sell, assign and transfer to
(SOCIAl SI:UJRrl Y
I II~ li\XI'I\ YFI~ IDI ;.NTIFYIN(i Nt I J
PLEASE COMPLETE TI-llS PORTION
shares of the stock of -------- -------------------------------
represented by Certificate(s) No(s) inclusive,
standing in the name of the undersigned on the books of said Company.
The undersigned does (do) hereby irrevocably institute and appoint ___________ _
_________ attorney to transfer the said stock or bond(s), as the case may be, on
the books of said Company_ with full power of substitution in the premises.
Dated
PRINTED NAME PRINTED NAME
EXHIBIT
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 14 of 18
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Exhibit “B”
Proposed Order
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA
MIAMI DIVISION
www.flsb.uscourts.gov
In re:
INTERNAL FIXATION SYSTEMS, INC,
Debtor. /
Case No.: 12-39145-RAM
Chapter 7
ORDER APPROVING CHAPTER 7 TRUSTEE’S EMERGENCY MOTION FOR
ENTRY OF AN ORDER (I) AUTHORIZING THE SALE OF CERTAIN ASSETS
FREE AND CLEAR OF ALL LIENS, CLAIMS, ENCUMBRANCES
AND INTEREST AND (II) APPROVING THE CONTRACT FOR SALE TERMS
THIS MATTER came before the Court for hearing on , 2015 at
a.m./p.m. (the “Hearing”) upon the Chapter 7 Trustee’s Emergency Motion for Entry of
an Order (I) Authorizing the Sale of Certain Assets Free and Clear of All Liens, Claim,
Encumbrances and Interest and (II) Approving the Contract for Sale Terms (the “Motion”) [ECF
# ____] pursuant to Sections 105 and 363 of Title 11 of the United States Code (the “Bankruptcy
Code”), Rule 6004, of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), and
Local Bankruptcy Rule 6004-1 (the “Local Bankruptcy Rules”). The Court having reviewed and
considered (i) the Motion1
and (ii) the arguments of counsel made and the evidence proffered;
1 Any and all capitalized terms not expressly defined herein shall bear the meaning ascribed to them in the Motion.
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 15 of 18
9
and it appearing that the relief requested in the Motion is reasonable and in the best interests of
the Estate, its creditors and all parties in interest; and after due deliberation and sufficient cause
appearing;
IT IS ORDERED that:
1. The Motion is GRANTED in its entirety and incorporated herein by reference.
2. Pursuant to Sections 363(b) and (f) and (k) of the Bankruptcy Code, the Trustee is
authorized to sell the Asset to Purchaser via private sale pursuant to and in accordance with the
terms and conditions of the Contract attached as Exhibit A to this Order which is APPROVED
in its entirety. Accordingly, the Court FINDS and ORDERS as follows:
a. the Seller is authorized to sell and the Purchaser authorized to purchase the
Asset free and clear of all liens, claims and interests under 11 U.S.C.
section 363(f);
b. any and all interests the Debtor may have in any real or personal property,
excluding the corporate shell of Debtor, shall remain in the Estate for
further administration under the Bankruptcy Code, and shall no longer be
owned or controlled by the Debtor;
c. pursuant to 11 U.S.C. Section 363(m), the purchase of the Asset is in good
faith and that the Purchaser is a good faith purchaser entitled to the
protections of 11 U.S.C. Section 363(m);
d. upon the Sale closing, the existing officers and directors of the Debtor are
deemed removed from office;
e. upon the Sale closing, the Seller shall deliver to the Purchaser a stock
power assigning, conveying and otherwise transferring the total issued and
outstanding convertible preferred stock of the Debtor to Purchaser (the
“Convertible Preferred Stock”) to the extent that the Debtor is the holder
of any currently issued and outstanding convertible preferred stock of the
Debtor (the “Stock Power”);
f. upon the Sale closing, all common share conversion rights of any kind,
including without limitation, warrants, options, convertible bonds other
convertible debt instruments, with the exception of the Convertible
Preferred Stock, are cancelled;
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 16 of 18
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g. within ten (10) days of the Sale closing, the Purchaser is authorized to
appoint a new board of directors; and
i. issue up to 140,000,000 shares of common stock to the Purchaser
or its assignees;
ii. implement a reverse split of the issued and outstanding common
stock in a ratio of approximately 5,000 to 1 or in a ratio further
determined by the board of directors;
iii. alter, amend and otherwise change the rights and preferences of
any holder(s) of the Convertible Preferred Stock, including,
specifically, the ratio at which each share of the Convertible
Preferred Stock may be converted into the common stock; and
iv. cause any and all reasonable actions to be taken to preserve the
Debtor’s listing on the Over the Counter QB or Pink Sheets
Marketplace, including, specifically, the filing of an SEC Form 15,
should it be deemed advisable.
3. Closing: The Sale closing shall occur on the first business day that is at least 7
days after the entry of the Sale order. At closing, the Trustee shall provide the Purchaser with the
following:
i. a certified copied of the Sale order; and
ii. all corporate books and records, other than operational books and
records, in the possession of the Trustee (if any).
4. The Sale of the Asset is “AS-IS, WHERE-IS,” without any representations or
warranties by the Estate or the Trustee of any nature whatsoever as to the use or the state of title
of the Asset.
5. Upon information and belief, there are no perfected liens on the Asset.
Accordingly, the Trustee may sell the Asset free and clear of all liens, encumbrances, and
interests of any kind or nature whatsoever, because the standards set forth in 11 U.S.C. §
363(f)(iv) have been satisfied.
6. The Trustee is authorized to take all actions necessary to effectuate the Sale of the
Asset and all other relief granted pursuant to this Order. The Trustee has the authority to execute
Case 12-39145-RAM Doc 288 Filed 07/28/15 Page 17 of 18
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all other documents reasonably required by the Contract, and no further consents or approvals
are required for the Trustee to consummate the Sale.
7. All persons or entities holding any liens, encumbrances, or interests of any kind or
nature whatsoever on or against the Asset (whether legal or equitable, secured or unsecured,
prepetition or postpetition, matured or unmatured, fixed or contingent, liquidated or unliquidated,
known or unknown) are forever barred, estopped and permanently enjoined from asserting such
Liens against the Purchaser (in connection with the Asset) or the Asset.
8. Notwithstanding the possible applicability of Bankruptcy Rules 6004, 7062, or
9014, or otherwise, and pursuant to Bankruptcy Rule 8005, the terms and conditions of this
Order shall be immediately effective and enforceable upon its entry.
9. The Court shall retain exclusive jurisdiction to implement and effectuate the
provisions of this Order and to resolve any issue or dispute concerning (i) the interpretation,
implementation, or enforcement of this Order or any issue or dispute concerning the Sale of the
Asset free and clear of liens, encumbrances, and interests of any kind.
# # #
Submitted by:
Christopher Spuches, Esq.
Counsel for Trustee
[e-mail]
EHRENSTEIN CHARBONNEAU CALDERIN
501 Brickell Key Drive, Suite 300
Miami, FL 33131
www.ecclegal.com
Copy to: Attorney Spuches, who is directed to serve a conforming copy herein upon all interested parties.