Et ST Custodianship Petition
Et ST Custodianship Petition
Et ST Custodianship Petition
11/26/2018 10:49 AM
Steven D. Grierson
CLERK OF THE COURT
1 PET
Peter Dubowsky, Esq.
2 Nevada Bar No. 4972
Amanda C. Vogler-Heaton, Esq.
3 Nevada Bar No. 13609
DUBOWSKY LAW OFFICE, CHTD.
4 300 South Fourth Street, Suite 1020
Las Vegas, Nevada 89101
5 (702) 360-3500
Fax (702) 360-3515
6 Attorney for Petitioner
7 DISTRICT COURT
8 CLARK COUNTY, NEVADA
9 ) Case No.: A-18-784952-C
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10 ) Dept No.: Department 20
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In the Matter of EARTH SCIENCE TECH, INC. )
DUBOWSKY LAW OFFICE, CHTD.
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12 )
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13 ) Date:
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14 ) Time:
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16
PETITION FOR A WRIT OF INJUNCTION AND APPOINTMENT OF RECEIVER
17 [NRS 78.630]
20 officer, and director by and through its attorney, Peter Dubowsky, Esq., of Dubowsky Law
21 Office, CHTD. hereby applies to this Court for a Writ of Injunction and an Order Appointing
23 a Nevada Corporation with its office in Florida at 8000 NW 31st Street, Unit 19, Doral, Florida
24 33122.
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2 and Authorities, the Exhibits and Affidavit attached hereto, and any oral argument this Court may
3 entertain at a hearing on the matter if your Honor feels a hearing in the matter is appropriate.
4
7
By: /s/ Peter Dubowsky
8 Peter Dubowsky, Esq.
Attorney for Petitioner
9
14 Please take notice that the DUBOWSKY LAW OFFICE, CHTD. will bring the foregoing
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15 9
Petition on for hearing on the _____ January
day of _______________, XX of
2018, in Department ______
16 8:30
the above entitled Court at ______a.m. or as soon thereafter as counsel can be heard.
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Signed: /s/ Peter Dubowsky
18
Peter Dubowsky, Esq.
Attorney for Petitioner
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I. SUMMARY OF MOTION
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The Board of Directors, through its Chairman, of EARTH SCIENCE TECH, INC., a
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Nevada Corporation, as well as a large shareholder and large creditor (being one and the same),
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is desiring to appoint a Receiver over the corporation’s business in order to reorganize the
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corporation and if so required dissolve, liquidate, and/or distribute its assets. Pursuant to N.R.S.
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§78.630, any stockholder/creditor owning one tenth (1/10) of the issued and outstanding stock
entitled to vote or for a creditor, holding one tenth of the indebtedness of the corporation, namely
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1 EARTH SCIENCE TECH, INC., may petition this Court for a Writ of Injunction and an Order
7 Lieu of Meeting is attached as EXHIBIT 1). We are looking to ratify this private appointment
8 of Mr. Stevens through the Court. Further, Mr. Tabraue has sworn an Affidavit as to the facts and
9 consent of the Board ( the Affidavit of Mr. Nickolas S. Tabraue is attached as EXHIBIT 2).
10 Mr. Issa El-Cheikh Mohammad (“El-Cheikh Mohammad”) is a large creditor in the
11 amount of $60,000 (Sixty Thousand Dollars) from a Cash Note to the Corporation which has
DUBOWSKY LAW OFFICE, CHTD.
12 gone unpaid and represents approximately 12% (twelve percent) of the outstanding indebtedness
13 of ETST. This note is outlined in a Form 10-Q filed with the United States Securities and
14 Exchange Commission (“SEC”) dated September 5, 20181 and is further attested to in his attached
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15 Affidavit (the Affidavit of Mr. Issa El-Cheikh Muhammad is attached as EXHIBIT 3).
16 Additionally, Mr. Issa El-Chiekh Mohammad is a large shareholder of ETST and controls
17 6,700,000 (six million seven hundred thousand) common shares or approximately 13.4% of the
18 outstanding stock which is represented in a Form 10-12G publicly filed with the SEC and dated
19 August 13, 2018 under the name Great Lakes Holdings Group, LLC 2. This ownership is further
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https://www.sec.gov/Archives/edgar/data/1538495/000149315218012898/form10
24 -q.htm
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25 https://www.sec.gov/Archives/edgar/data/1538495/000149315218011498/form10
-12ga.htm
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1 attested to in his attached Affidavit ( See EXHIBIT 3). Mr. El-Cheikh Mohammad, pursuant to
2 N.R.S. §78.630, has the authority to file this action with the Courts of Nevada.
3 As of the last Form 10-Q filing with the SEC filed on September 5, 2018, for the period
4 ending June 30, 2018, the Defendant Corporation has common shares outstanding of 47,942,475.
5 On November 16, 2018 the Board of Directors voluntarily and with full knowledge and
6 understanding, appointed Robert L. Stevens, President of Strongbow Advisors, Inc., a Colorado
7 corporation, as their choice for Receiver in order to fulfill the necessary requirements under
8 Nevada law. (see EXHIBIT 1)
9 On November 19, 2018, Mr. El-Cheikh Mohammad, the said shareholder/debtor,
10 voluntarily and with full knowledge and understanding, appointed Robert L. Stevens, President
11 of Strongbow Advisors, Inc., a Colorado corporation, as his choice for Receiver in order to fulfill
DUBOWSKY LAW OFFICE, CHTD.
12 the necessary requirements under NRS §78.630 of this Nevada corporation. (See EXHIBIT 3)
13 Therefore Petitioner, Strongbow Advisors, Inc. and specifically, Robert L. Stevens, its
14 President, has agreed to operate in the capacity of Receiver for this Nevada Corporation, EARTH
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16 Mr. Tabraue, Chairman, and the Board of Directors and Mr. El-Cheikh Mohammad and
17 the privately appointed Receiver, Robert L. Stevens, hereby apply to this Court for the formal
18 appointment of Robert L. Stevens as Receiver of EARTH SCIENCE TECH, INC. under NRS
19 §78.630. In order to fully assess the company and its financial standing, a Writ of Injunction is
20 required to prevent corporate erosion and a Receiver would need to be appointed to move for the
21 reorganization of the corporation and, if required, the dissolution, liquidation, and distribution of
22 its assets, should there be a compelling reason for the Receiver to take such an action.
23 Additionally, the Receiver, if he so chooses, seeks authority to borrow money, issue receiver’s
24 certificates, incur debt, issue any class of stock, debenture or other financial instruments as
25 required to finance the administration of the estate.
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1 The Receiver further seeks a Blanket Stay to assist him in the protection of the assets of
2 this Nevada Corporation during his tenure as Receiver, should it be granted while he resolves the
3 issues at hand.
4 II. THE LAW
located or, if the principal office is not located in this State, to the district court
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in the county in which the corporation’s registered office is located for a writ of
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injunction and the appointment of a receiver or receivers or trustee or trustees.
15 hearing after such notice as the court by order may direct, shall proceed in a
summary way to hear the affidavits, proofs and allegations which may be offered
16 in behalf of the parties.
17 3. If upon such inquiry it appears to the court that the corporation has become
insolvent and is not about to resume its business in a short time thereafter, or that
18 its business has been and is being conducted at a great loss and greatly prejudicial
to the interests of its creditors or stockholders, so that its business cannot be
19 conducted with safety to the public, it may issue an injunction to restrain the
corporation and its officers and agents from exercising any of its privileges or
20 franchises and from collecting or receiving any debts or paying out, selling,
assigning or transferring any of its estate, money, lands, tenements or effects,
21 except to a receiver appointed by the court, until the court otherwise orders.
22
In addition to the protections of NRS § 78.630, the Receiver seeks a Blanket Stay
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pursuant to a receivership stay order. A court’s power to issue a receivership stay order “falls
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within the court’s inherent power to prevent interference with the administration of th[e] estate”
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(SEC v. Credit Bancorp., Ltd., 93 F. Supp. 2d 475,477 (S.D.N.Y. 2000)). The power of the court
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1 to issue a stay effective against all persons, of all proceedings against the receivership is well
2 established. In SEC v. Wencke 622 F.2d 1363, 1369 (9th Cir.1980), the Ninth Circuit held that
3 the authority of a court to issue an order staying a non-party from bringing litigation derived from
4 “the inherent power of a court of equity to fashion effective relief.” The Receiver requests this
5 Honorable Court order a stay of proceedings (“Blanket Stay”) against the receivership entities
6 except by leave of the Court.
7 III. BACKGROUND
8 Petitioners voluntarily and respectively request that Robert L. Stevens, as President of
9 STRONGBOW ADVISORS, INC., be appointed receiver, based on his expertise and knowledge.
10 The Defendant Corporation was incorporated in the State of Nevada on April 23, 2010
11 under the name Ultimate Novelty Sports, Inc. The Company was originally a startup company
DUBOWSKY LAW OFFICE, CHTD.
13 On March 6, 2014, the Board of Directors of the Defendant Corporation approved the
14 name change from Ultimate Novelty Sports, Inc. to Earth Science Tech, Inc. and our trading
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16 Shortly thereafter the Company began to focus on the cannabis market with a joint
17 venture that began with a vaping company, I Vape Vapor, Inc., a Minnesota corporation. This led
18 management to explore CBD and full spectrum cannabinoids as supplements and later into
19 medical research and development where the Defendant Corporation’s current focus of
20 operations continues. The Company currently has 13 employees.
21 The Company developed a dispute with a customer, Chromogen Corp, and was required
22 under its contract to engage in binding arbitration to resolve the dispute.
23 This arbitration resulted in an award that is under appeal but has not yet been reduced to
24 a judgment as of the filing of this petition. In the arbitration, the Company prevailed on breach
25 of contract claims but was assessed a tort award in the amount of $3,500,000.
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1 This tort award threatens the pure survivability of the Defendant Corporation and has put
5 remains federally illegal. (Controlled Substances Act, 21 U.S.C. §§ 801 and Gonzalez v. Ranch,
6 545 U.S. 1, 12(2005)) Without the appointment of a Receiver the assets of the enterprise are at
7 risk, creating dire circumstances for the creditors, shareholders and employees.
8 The receivership process will create a forum for an orderly and fair resolution of claims
9 and provide protection for the creditors, shareholders and its employees.
10 As the Defendant Corporation is a public company, the Receiver must be highly skilled
11 in handling public company receiverships in order to administer and protect the estate. The
DUBOWSKY LAW OFFICE, CHTD.
12 requested Receiver, Robert L. Stevens of Strongbow Advisors, Inc., has served as court-
13 appointed Receiver in Nevada’s Eighth Judicial district 9 (nine) times, and has a successful track
14 record. The Receiver shall produce a list of these companies at the request of the Court.
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15 Regarding The Defendant Corporation’s standing, it is active with the Nevada Secretary
16 of State Office and the Company’s registered agent represents it is active with the State of
17 Nevada. The Company is also up-to-date with its filings with the United States Securities and
18 Exchange Commission, but the Company does have some edits that need to be resolved in its
19 OTC Markets webpage. The Receiver will make sure this is updated.
20 In compliance with NRS 78.630, Petitioners hereby apply for a Writ of Injunction and
21 Receivership of EARTH SCIENCE TECH, INC. and a Blanket Stay and submits the attached
22 affidavit attesting to the following information: (See EXHIBIT “4”).
23 1. Affiant, individually, and as President and the authorized officer and director of
24 Strongbow Advisors Inc., a Colorado corporation, in this action and makes this Affidavit
upon his own personal knowledge.
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2. Stevens is a resident of Aurora, Colorado.
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1 3. Strongbow Advisors, Inc., is a privately-owned corporation controlled by Robert L.
2 Stevens that provides receiver services and ancillary consulting for liquidations and
turnaround situations.
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4. Strongbow Advisors, Inc. is located at 387 Corona Street, Suite 555, Denver, Colorado
4
80218. Phone number (720) 281-5000.
5 5. Strongbow Advisors Inc., is in good standing in the State of Colorado.
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6. I have been appointed Receiver by the Eighth Judicial District of Nevada for
approximately fifteen different publicly traded corporations and by the District Court of
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Denver, Colorado on approximately eight different publicly held corporations.
8 7. Affiants, Robert L. Stevens and Strongbow Advisors, Inc. have no ties to Defendant,
9 EARTH SCIENCE TECH, INC. herein referred to as “ETST” or “Defendant
Corporation.” Affiants are not creditors, investors, shareholders, employees, consultants,
10
etc., and have no involvement with Defendant other than discussions related to this action
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and an understanding that the corporation and the sole officer and director and
DUBOWSKY LAW OFFICE, CHTD.
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Strongbow Advisors, Inc. as the Court Appointed Receiver of EARTH SCIENCE TECH,
INC. under N.R.S. §78.630.
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8. Nicholas Salomon Tabraue, Chairman of the Board, has authorized and consented on
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15 behalf of the Board of Directors in an Agreement to Appoint Receiver with its appropriate
16 Board Consent, authorizing the voluntary appointment of me to become Receiver for
EARTH SCIENCE TECH, INC and we are seeking the court to ratify this appointment.
17
See Exhibit of Agreement to Appoint Receiver.
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9. Issa El-Cheikh Mohammad is the owner, under the name Great Lakes Holdings Group
19 LLC, of 6,700,000 shares or approximately 13.4% of the outstanding shares of EARTH
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1 13. The Defendant Corporation is active with the Secretary of State of Nevada as of April
2 13, 2018. ETST is not set to expire until April 30, 2019. ETST was incorporated in the
State of Nevada on April 23, 2010.
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14. The Nevada Secretary of State Website represents the commercial registered agent as
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active.
5 15. EARTH SCIENCE TECH, INC. is a publicly traded company under the ticker symbol
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ETST.
16. Affiant reviewed all detectable aspects of the corporation and individuals involved while
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also speaking to management on multiple occasions. It was determined that without the
8 appointment of a Receiver to reorganize the assets of the Company, under NRS §78.630,
9 the Corporation would be at risk of loss that would greatly impair the creditors,
shareholders and any employees of the Company.
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17. Should this Honorable Court grant this appointment as Receiver, the Receiver will have
DUBOWSKY LAW OFFICE, CHTD.
13 (a) Take immediate control, to the exclusion of all others, over EARTH
14 SCIENCE TECH, INC. and all of its assets, its subsidiaries, current
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1 all funds therein; and open, transfer and change all bank and trade
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bank or banks, financial institutions, mutual funds, brokerage
institutions or other commercial depositories in the Denver,
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Colorado metropolitan area selected by Mr. Stevens, in his name;
8 (d) Collect rents and revenues, income, profits, and other benefits of
9 EARTH SCIENCE TECH, INC. and its subsidiaries or the
Receivership Property;
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(e) Collect all accounts, accounts receivable, notes receivable, income,
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profits and proceeds which are part of the Receivership Property or
DUBOWSKY LAW OFFICE, CHTD.
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necessary, negotiate and deposit checks into accounts maintained by
Mr. Stevens, and, as necessary, to collect and review mail directed
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to EARTH SCIENCE TECH, INC. and its subsidiaries in order to
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20 (g) Pay or negotiate expenses, bills, taxes, insurance and other legal
obligations of EARTH SCIENCE TECH, INC. and its subsidiaries;
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(h) Appoint interim management to oversee the operations of the
22 company and to remove any personnel.
23 (i) Retain legal counsel and to commence, file and maintain legal
proceedings to protect the Receivership Property or pursue claims
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against any individuals or entities that have created harm to EARTH
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SCIENCE TECH, INC. and its subsidiaries and its creditors and
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1 shareholders including filing for relief and protection in Federal
6
SCIENCE TECH, INC. and its subsidiaries;
(m) Order dividends, distributions or other such actions to DTC that may
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be required for dissolution or reorganization of EARTH SCIENCE
8 TECH, INC.;
9 (n) Do any and all acts necessary and convenient or incidental to the
foregoing that the Receiver reasonably deems necessary to manage
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and preserve the Receivership Property; and
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(o) Restore any changes by Defendant Corporation, such as issuance or
DUBOWSKY LAW OFFICE, CHTD.
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to resolution.
(p) If in the case of a reorganization, the Receiver is granted authority
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to:
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20 securities.
(q) Borrow money, issue receiver’s certificates, incur debt, issue any
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class of stock, debenture or other financial instrument as required
22 to finance the administration of the estate;
23 (r) I am subject to all applicable provisions of the Nevada Revised
Statutes.
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25 18. If called to testify as a witness, Affiant is competent and would testify to the facts set
forth in this Affidavit.
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1 As a result of the arbitration award against EARTH SCIENCE TECH, INC., the
2 Defendant Corporation is in grave risk and irreparable injury to the Defendant Corporation is
3 threatened and likely. Shareholders and all creditors rights of the Defendant Corporation cannot
4 be objectively determined or preserved without a Writ of Injunction and the Appointment of a
7 aligned with every other shareholder and creditor, both within and outside the State of Nevada,
8 and as similarly situated, and would benefit from the appointment of a receiver of the Defendant
9 Corporation.
10 The role of a Receiver is to safeguard and protect assets of the company for the benefit
11 of the creditors and shareholders. Without the appointment of a Receiver to address the issues
DUBOWSKY LAW OFFICE, CHTD.
12 outlined above, the assets of the business are threatened with irreparable injury to the detriment
14 Robert Stevens has served as Nevada court appointed receiver over nine times in similar
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15 situations in his past, and has been successful in resolving issues such as the ones facing the
16 Defendant Corporation. including the SEC, DTC, FINRA and the Nevada Secretary of State
17 compliance. Mr. Stevens has been in the securities industry for more than 30 years and has
18 experience resolving the issues facing EARTH SCIENCE TECH, INC.
23 conserve, preserve, protect and administer et al EARTH SCIENCE TECH, INC., a Nevada
24 Corporation which are at grave risk. Assets which would be subject to the receivership include,
25 but are not limited to EARTH SCIENCE TECH, INC. stocks, the corporation’s name, its
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1 Trademarks and Patents, its subsidiaries, inventory, equipment and any other assets and interests
2 it possesses. A Writ of Injunction should be issued to prevent further erosion of corporation for
3 creditor and stockholder interest including the potential cancellation of any stock issued if, any
4 stock has been issued. A receiver should also be appointed to conserve, preserve, protect and
5 administer EARTH SCIENCE TECH, INC.’s assets, reorganize them and to ultimately dispose
6 of said assets and distribute the proceeds thereof in accordance with the further orders of this
11 N.R.S. §78.630 and grant it the authority to move for the dissolution, liquidation, and distribution
DUBOWSKY LAW OFFICE, CHTD.
12 of its assets, or the reorganization of the Company should there be a compelling reason for the
13 Receiver to take such an action. The Receiver further requests a Blanket Stay in order to manage
14 and reorganize the Corporation. Additionally, the, Receiver, if he so chooses, seeks authority to
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15 borrow money, issue receiver’s certificates, incur debt, issue any class of stock, debenture or
16 other financial instruments as required to finance the administration of the estate without further
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