United States of America v. Rocket Ventures II SBIC, L.P.

Filing 2

STIPULATION FOR CONSENT ORDER of Receivership appointing U.S. Small Business Administration as Receiver for Rocket Ventures II, SBIC, L.P. re 1 Complaint filed by United States of America. Signed by Judge Jeffrey S. White, on September 4, 2008, USDC, Northern District of California San Francisco Division, case number C08-02240. (lw)

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3:08-cv-02240-JSW Documentl$ F i l e d09/0/2008 Paqe1 of 11 J O S H P IP, RUSSONIELLO. NO. 44332 { CA Uflited StatesAttomoy J O A N NM. SWANSON (SBN 88r43) C h i e f ,Civil Division , E D W N L. JOE(SBN r 12328) S p e c i aAssistaflt l UnitodStatos Attomey restlflrutspffif%H BT cHRrS R, J0ril60f{, crtrl( EPrfiYH.Bt( S t Ptem t 455 Market Street,6F Floor S a nFrancisco, Califomia 94105-2420 T e l e p h o n e : (415)744-8494 F a c s i m i l o ; (20?) 481-1810 (415) or 744-6812 e d w i njoe@sba.gov Email: Plaintiff A t t o m e y sfor Fodoral 10 ll t2 t r s -oy-zo IN THE T]NTIED STATESDISTRICT COI]RT FOR TIfi NORTITERNDISTRICT OF CALIT'ORNIA SA} I FRANCISCO DTVISION l4 I5 TJTIITED STATES OF AMERICA. I'laintiff. v, ROCKET VEI{TURES tr, SBrC, L.P. Defendqnt. E-FiIing C i v i l Crse No. C08-02240 JSW S t i p u l f ltiotr for ReccivershipOrder a n d ConsentOrder ( C o v e r Page) l6 l8 t9 zt) 2l 22 23 u l{ 26 27 28 c 08- 0224JSW0 3:08'cv-02240-JSW DocumentlS F i l e d09/06/2008 Page2 of 11 I 2 3 4 IN TIIE UNITED STATESDISTRICT COI]RT FOR THE NORTIIERN DISTRICT OF CALIFOR]\IA I]NITEI} STATESOI' AMERICA. Plaintiff. I ) ) J 6 ,7 I I l0 ll ) R OC I(E TVnNTURES SBIC,L.P. n, Dcfendent, ) Civil Case No, C0E-02240 JSW ) l ) ) ) STIPUIdTION FOR CONSENT ORDER OF RECEI1-RSIilP W H F : R E A SPlaintiff, UnitedStates America,on behalfof its agency, , of the l4 l5 I6 l7 t8 l9 T) 2l J7 U n i t o dStates $mall Business ,{dministration, filed and caused be servod has to upon dofondart, ROCKETVENTTIRES SBIC,L.P., a complaint; Il, and W H E R E A S ,the partiesdEsire resolve matteramioably without further to the and p r o o e e d i n g s , or adjudication trial ofany issue, as andstipulate follows: I. "), Thatdefbndant ROCI{-EI'VENTURES SBIC, L.P. ("Lioensee the II, h o l d e rof the U.S. SmallBusiness Administration's tnvestment f'SBA1 SmallBusiness Company License No. 0979-0435, a oonditionof CapitalImpairmcnt, thattenn is has s,5 d e f i n e dunder'l'itle l3 ofthe Codeof Federal Regulations, Part 107(the.'Rcgulations"); T h a tdefendant Licensee failed to requirethat all privatecapiul 24 1< 26 )1 c o mmi tme nbefunded asa consequence, consonted thoappointment ts and, has to ofSBA asReceiver thepurpose for ofcontinuing defcndant's pursuant the operations to Regulations; 28 c0s-02240 _ Jsw S]LIPULATION FOR CONSENT ORDEROERECEIVERSHIP 3:08-cv-02240-JSW Document 1$ F i l e d09/06/2008 Page3 of 11 I 2 3. Thatthis Court hasjurisdiction overthe subject matterofthis actionand o v e rdefendant; 4. Thatthe only mutuallyagreeable methodby whiohtd distribute asscts the 4 o f t h e Licensee the appropriate to creditors and SBA is throughthe appointment ofSBA t) a s thereceiver pursuant the following Consent ofthe Licensee to OrderofReceivership w i t h o u t furtherproceedings; and 5. To the entryofthe following Consent OrderofReceivership without 1 I t0 ll l2 f u r t h o rproceodings. IT IS HER-EBY ORI}ERED, AI}JIJDGED AND DECREEDI I. Pur$uant the provisions 5 LI.S.C.g 687c,this Court hereby to | takes l4 ll jurisdiotionofthe l.icensoe, all of its assets property, exolusive and and ofwhateverkind a n dwherever looated, the SBA is herebyappointed and Reoeiver ofthe Lioensee ( " R e c c i v e r " ) scrvewithout bonduntil furtherorderof this Corrt. The Receiver to is I6 t l9 20 a p p o i n t e d the purpose for ofmarshalingand liquidatingall ofthe Licensee's assets and s a t i s f u i n g olaimsofcreditorstherefr.om the orderofpriority asdetermined this the in by Coun. 'Ihe 22 23 24 25 ?6 2"1 28 shallhaveall powers, Receiver authorities, rightsandprivileges heretofore possessed the officers,direotors, by and managors gonoral and limitedpartners o f t h c Lioensee underapplicable stateandfcderallaw, by the Limited partnership A g r e o m e n tandBy{,aws of saidlinited partnership, additionto all powersand , in a u t h o r i t yof a receiver equity,andall powersand authorityconfeneduponthe at R e c e i v eby theprovisions I 5 U.S.C.$ 6870and28 U.S.C,g 754. Thetrustees, r of c08-{t2240 Jsw STIPUI,AIION FOR CONSENT ORI}ER O.E XECEII4ERSIIIP 3 : 0 8 - c v - 0 2 2 4 0 - J S WDocumen1$ t F i l e d09i06/2008 P a g e 4 o f 1 1 I 7 d i r e c t o r sofhcers,managers, , employees, investment advisors, accountaitsr attorneys and o t h e ragents partners ofthe Lioensee hereby are dismissed the powercofany general and a r eherobysusponded duringthe pendency the receivership. of Suchpersons cntities and s h a l lhaveno authoritywith respeot the Lioensee's to opcrations assets, or exoept the to 6 7 I I l0 tl e x t o n tasmay hereaftor exprcssly granted the Receiver.The Receiver be by shallassume a n d controlthe operation ofthe Licensce shallpursuo and andpreserve of its claims. all 3. possession The Roceiveris entitledto tal(eimmediate ofall assets, bank a c c o u f l t s otherfinancialaccounts, or booksandrecords andall otherdooumonts or i n s m r r h e n trelatingto tho Lioensoe. s The pastand/orpresent officers,directors, ageflts, t z manager$, general and limitod partners, trusters,attomeys, accountanB, employees and o f t h e Licensee, well asall thoseactingin their place,arehereby as ordered directed and I4 t o turn overto thc Rcceiverfonhwith all books,records, documents, aooounts all and l5 t6 t1 o t h e rinstruments papers and ofand relatingto the Li$Ensee all ofthe Liconsoe's and a s s o t s all otherassets propertyof the limited partnership, and and whotherreal or 's p e r s o n a l .The Licensee gefleral partnershallfumish a written statomont within five (5) d a y saftertlre entryofthis Ofder, listingthe identity,looation andestimated valueofall assots (andjob titles lhereof),o0rerpersonnel, ofthe Lioensoo, list ofall employees a t8 t9 20 J'| a t t o m c y saccotrntants arryotheragents contractors , and or ofthe Lic.ensee, well asthc as n a m e saddlesses amounts olaimsof all known creditors the Licensee.Within , and of of 24 25 26 ?7 28 t h i r t y (30) daysfollowing tho entryofthis Ordcr,lhe Licensee's parrner shallal$o Heneral f u m i s h a written reportdescribing assets. persons ontities all All and havingcontrol, c u s t o d y possossion any assets propertyof the Licensee hereby or of or are dirocted turn to s u o hassets proprtyoverlo theReceivor, and clf8-022{t JSw * S,TIPULATION FOR ESNSENTORDE,R RECEI!'ERSHIP OF 3:08-cv-02240-JSW Documentl$ F i l e d09/0$/2008 Page5 of 11 I 4. to The Reooiver shallpromptlygive noticeof its appointmeflt a.llknown z 3 dgent$l employees, o f f i c e r s ,diroctors, shareholders, managers and creditors, dobtors, g e n e r aandlimiled partners l ofthe Lioonsoe, the Receiver deems as neoessary or 5 6 1 I c a d v i s a b l e effectuate operation to thc All ofthe roooivership- persons entitiosowing and a n y obligation, with respeot a partnership interest tho Licensee, to debt,or distribution, to with by s h a l l ,until funhcr ordered this Court,pay all suchobligations accordance the in t e r m sthetcofto ths Rcceiverand its reoeiptfor suchpayments shallhavethe sameforce had a n deffectasif thc Licensee rooeived suohpflyments. 5. The Receiver herebyauthorized oponsuchReceivcr's is at acoounts to r0 ]I t2 ll l4 b a n k i n gor otherfinancialinstitutions extetrd to to crediton behalfofthe Lioonsee, utilize S B A personnel, to employsuchotherporsonnel, and includingthe formermanagers of as the t h e Defendant, it may deemneoessa4' effectuate operalion to ofthe reoeivership t5 lo i n o l u d i n g ,but not limitedto, attorncys, accountants, and oonsultants appraisers, is and f u n h c r authorized expend fundsto coinpensate in to rooeivership suchpersonnol such l8 19 20 a m o u n t s upon$uchtermsaslhe Receiver and shalldeemreasonable light of theusual in and f e e sandbilling practices procedures suchpersonnol.Tho Receiver not requirod of is prior to the disbursement t o obtainCourtapproval firndsfor payments ofreooivership to 2l 22 23 p e r s o n n eemployed the Rooeiver for expenses theRecciverdooms l by or that a d v a n t a g e o u s the orderlyadministration operation the receivership, addition, to and In of is to t h o Roceiver authorizcd reimburse SBA for travolexpenses the incurred SBA by 25 26 27 28 p e r s o n n ein the establishment 4dmini$tration l ofthe rcceivcrship. may, and The Roooiver w i t h o u t furtherorderofthis Court,transfcr,compromise, otherwise of or dispose any in c l a i f t or asset the ordinaryoourso ofbusiness, otherthaflreal estate. c0s-02240 Jsw STIPI]I.ATION FOR CONSENTORI}ER OF RECDI\IERSIIIE 3 ; 0 8 - c v - 0 2 2 4 0 - J S WDocumentlS F l l e d09/04/2008 Page6 of 11 I 2 3 6. The Licensee's pasland/orpresent offioers,dircctors, agents, attornoys, m a n a g e r sshareholders, , omployees, accountants, deb'tors, croditors, managers and g e n e r aand lirnitedpartners the l,icensee, otherappropriaE l of persons entities and or 5 ( i n c l u r l i n gwithout Iimitation,the deferrdant,s portfolioof small business concerns and f i n a n c i a linstittrtions doingbusinoss with defendant portfolioof small and/ordefendant's 1 business concerns) shallansworunderoathto thc Reooiyer quostions all whiph lhe Receiver may put to therhand produce documents reqrrired the Reoeiver any as by I l0 tl t2 l3 l4 r e g a r d i n g business saidlimitodpartnership, ary othormatterrelevant the the of or to o p e r a t i o n administr ion ofthe rooeivership tho colleotion or or offunds drreto the L i c e n s e e .ln the ovontthat tho Receiver deoms necessary requiretle appearance it to of t h e aforementioned persons entities,theReciver or shallmakeits discovery request(s) in a c c o r d a n cwith theFedoral e Rulesof Civil Procodure. ll l6 7. Thc partie$ any aDdall civil legalprocecdings td inoluding, ofany nature, proceedings, arbirration proceedings, forcclosure actions, r 7 b u t not limitedto, bankruptcy l8 I9 20 2l 22 d e f a u l tproooedings, otheractions anynaturoinvolvingthe Licensoo any as$ets or of or of t h e Licensee, includingsubsidiaries partnerships, and wherever located, excluding and 's t h e instantproceeding, involvingthe Licensee, Receiver, any ofthe l.icensee tho or p a s tOrpfeseDt officers,diroct$rs, managerg agents, general limitedpnrtners or or suod f o r , or in connection with, any actiontakenby themwhile aotingin suohcapaciry ofbny 24 ?5 nature,whether asplaintiff, defendnnt,third-pafly plaintiff, third-party defendant, or o t h e r w i $ eareenjoined , from commencing continuing suchlegalproceeding, or any or 26 27 2tt f r o m takingany actionrin conneotion with flny suchprocerding any suchassct.All or c i v i l logalprocoedings ofany narure, inoludingbut not limitedto bankruprcy c08-02t4Jsw 0 3:08-cv-02240-JSW Documentl$ F i l e d 09/04/2008 Page7 o{ 11 I procsedings, arbitration prooeedings, foreclosure actions, defaultproceedings, other or a o t i o nofany natureinvolving theLicensee ary assets or ofthe Lioenseqinctuding s u b s i d i a r i eandpartnerships, s wherever looated, exclrrding instantproceeding, and the i n v o l v i n gtho Licensee, Receiver, any ofthe Licensee's thc psstor present or officers, d i r e o t o r smanagers, , agcnts, general limitedpartners or or with, suodfor, or in connection a n y aotionuken by themwhile aotingin suohcapacity anynature, of whetherasplaintifI, d e f o n d a n tthird-partyplaintif{ third-partydefendant, otherwise, srayed thsir , or d-re in s n t i r e t y ,afld all Courtshavingan1, thereofare onjoinedfrom takingor .jurisdiction p e r m i t t i n gany actionuntil furthorOrderof this Court. Further,aEto a cause ofaotion a o c r u o d accrrring favor ofthe Liconsee or in against third person pady, any a or applicable of statute limitationis tolled duringthe periodin which this injunctionagainst c o m f f e n c c m e noflegal proceedings in effectasto that cau$e t is ofaction. 8. The Licensee its pastf,nd./or and present direotors, officors,managers, 2 3 4 5 6 7 I 9 r0 lt '11 t3 l4 l5 17 l8 l9 ?0 g o n e r aor limited partflers, l employees othcr persons entitiesactingin agents, and or c o n c e r tor participating thcrcwithbe,andthey hereby are,enjoined from eirhertlirectlyor i n d i r e c t l ytaldngany actions causing or any suchactionto botakenwhichwould d i s s i p a t e assets propertyofthe Lioensee the detriment and./or the to ofthe Liconsee of or in includingbut not limited to destruction oorporate of xz the Rcceiversppointod this cause, r e c o r d sor which would violatethe SmallBusinoss , lnvostment of I95g. asamentletl. Act t4 t( l 5 U,S.C.661g!, seo.,or the regulations promulgated thercunder, ("Regularions"), l3 C . F . R .$107.1 peg. ot. 26 27 28 9. The Receiver authorized borrowon behalfofthe Lioensoe, is to fiom the S B A , up to $1,000,000 is authorized cause Licensee issueRooeiver,s and the to to c08.0224J$W0 3 : 0 8 - c v - 0 2 2 4 0 - J $ WD o c u m e n t 1lD Filed 09/04/2008 PaqeB of 11 I 2 Certifioates oflndebtedness the principalamounts in ofthe sumsborrowed, which c e r t i f i o a t e s bearifltercstat of about| 0 peroont annumandwill havea matu.rity will per d a t eno laterthan l8 monthsafterthe dateofissue. SaidReceiver's Certificates of 5 6 1 I 9 t0 ll lndebtedless shallhavepriority overall otherdebtsandobligations ofthe Lioensee, e x c l u d i n gadministrativo expenses the Receivership, of whether currentlyexistingor h e r e i n a f t oinourred, r inoludingwithout limitationany claimsof gcneral limited or p a r t n e r s the Lioensee. of 10. This Courtdetermines adjudicates SBA hasmadea $uffioiont and thar s h o w i n gthat the Licensee violatedthe Act andthe Regulations, allegedin the has as C o m p l a i n tfiled against Licensee the instantaotion, obtainthc relief so the ifl to rcquested. After oompleting activitiesin accordanoe this Order,the Receiver its with tz t4 m a y submita rcportto this Courtrecommonding the Licensee's that SBIC license be tt t6 l'l 18 revoked. SEEN, STIPULATED AND AGREED: R o c k e t VenturesII SBIC, L,P., through its authorized representetiv6 By: /s/ DavidAdams D a v i d Adams T i t l e : Gcneral Partner R o c k o tVentures SBIC Partners, I-.L.C. G e n e r aPartncrof RocketVentures SBIC, L.P. l lI Date: 8/25/08 r9 20 2l 22 24 ?t )fi U n i t e d $tatesSmall Bueiness Administration By: /V Thomas Monis G. T h o m a s Monis, Direotor G. O f f i c e of Liquidation Date: 08-28-08 28 c08-02240 JSW FORCONSENT STIPULATION ORDER. R-ECEIVERSHIP OF r-aseJ:ub-cv-ull4u-J5 vv uocument1b Flled09/00/2[.]UEPaoe 10 o{ 11 I l l (.lcrtiiicalds ()l d a l t ritrltt(r th3l1 ftonthsrilict thc d8tco! irisr,r(. lll $aidlttrr,rirer's lndebttOncss shnllh,rvcprioritydvct trllt\thcrdrtl)tn obligatirrns.rl'thc nlld I.,iccnsec. !\,1)rthrf e s u l r r J i r rirdrninistrativc p cxpenres tlreRt't*ilcrship, ol rurerltl), t:tistingrr j incurrtd.irtr:luding withourlinritahon hrtreirrdlier ant,cluiurs ofgeneralor linritc'1 p r d n c r softht I ic+rist*,', l. 'Ihjs Crrrrrltlctcrrnines rrndldjudicatcr thirt SjBAirlrsnr,ldci' .rLrifltrir:nt that lras the as s l r l l . r i n g , thc Liccnsee violoted A(,trrndtheRrpulation:'. allcgcJin tirc in thc [ ] u r r r p l l i n ifilcd altirinst l.icensee lJrcinstaDl lhc Ectiorl, r)htuin rclitf:l() 1I' ils in Ordct,tlrt l{crrivr:r r c q u c s r e , ,Aficr cdmplcting activi{ics uttdrdalccwith t-hir l. tl :l that s hc n u l suhrr:1treport1olhis Coufi rcuommcnding the Licenscc SBIC liccnsc a rt!l)lit. ANn AcRIitI): sE[.,N, STlrl]l.ATF.r) R o d k t t r'crt l,- B\,.ffi./.{fr-, I)it r(l/LfSBIC, L.F.fi,rugh it'{ ruth0rit-cd rcPri'l!(:nitlti\'c I irlc: OcrrffalPart|]cr SBIC Partntrs, L.l,.C. R o c l e t Verrnues G c n c r a lPrtflnerof RoukctVenturuslJ S13ll. 1..P. lfl 2l ::l t3 1n 7t It, r ) r r r r* r - AIE ;F/35 --- L t U r i t d Strtff SmallIlrrsinest Atlmlnlstrutiou i,f'-- i "4 *-ry;;-:; ...-..-.--. / .-.. ( I tlolnrr:'r. Moll $, lJrrcclor 0 t l i c { of Liauidrtion -' - .i r I li1 . 1 1 1 c ;Jr- --' )-I----...-o--F :; .it l O S ' U L r t U t d ' l t l o t r(lR c()NSUAT 3108-cv-02240-JSW DocumentlS F i l e d 0S/0S/?008Page11 of 11 }'URSUANTTO STIPULATION. IT IS SOORDEREI}. D A T E Drhi$ 4rh S.WHITE c0&02240 Jsw_ STIPULATIOII FOR CONSEI{TORDEROF RECEN'ERSHIP

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