SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13G
Under the Securities and Exchange Act of 1934
(Amendment No. __)(1)
AMS HEALTH SCIENCES, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
00178W105
(CUSIP Number)
October 13, 2005(2)
(Date of Event Which Requires Filing of this Statement)
Check the appropriate box to designate the rule pursuant to which this Schedule
is filed:
[ ] Rule 13d-1(b)
[X] Rule 13d-1(c)
[ ] Rule 13d-1(d)
----------
(1) The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class
of securities, and for any subsequent amendment containing information
which would alter the disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 (the "Act") or otherwise subject to the
liabilities of that section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
(2) Represents the date on which Arthur Steinberg, Esq. was appointed
Receiver for Wood River Capital Management, L.L.C., Wood River
Associates, L.L.C., Wood River Partners, L.P. and Wood River Partners
Offshore, Ltd. As more fully described herein, Mr. Steinberg has not
yet obtained information as to the date on which certain Wood River
Entities acquired more than five percent of the shares of common stock
of AMS Health Sciences, Inc.
CUSIP No. 00178W105 SCHEDULE 13G
1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Wood River Capital Management, L.L.C.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ]
(b) [X]
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Citizenship or Place of Organization.
Delaware
--------------------------------------------------------------------------------
Number of 5. Sole Voting Power
0
---------------------------------------
Shares Beneficially 6. Shared Voting Power
484,200
---------------------------------------
Owned by Each 7. Sole Dispositive Power
0
---------------------------------------
Reporting Person With: 8. Shared Dispositive Power
484,200
--------------------------------------------------------------------------------
9. Aggregate Amount Beneficially Owned by Each Reporting Person
484,200
--------------------------------------------------------------------------------
10. Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
--------------------------------------------------------------------------------
11. Percent of Class Represented by Amount in Row (9)
6.5%
--------------------------------------------------------------------------------
12. Type of Reporting Person (See Instructions)
OO
--------------------------------------------------------------------------------
Page 2 of 25
CUSIP No. 00178W105 SCHEDULE 13G
1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Wood River Associates, L.L.C.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ]
(b) [X]
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Citizenship or Place of Organization.
Delaware
--------------------------------------------------------------------------------
Number of 5. Sole Voting Power
0
---------------------------------------
Shares Beneficially 6. Shared Voting Power
153,100
---------------------------------------
Owned by Each 7. Sole Dispositive Power
0
---------------------------------------
Reporting Person With: 8. Shared Dispositive Power
153,100
--------------------------------------------------------------------------------
9. Aggregate Amount Beneficially Owned by Each Reporting Person
153,100
--------------------------------------------------------------------------------
10. Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
--------------------------------------------------------------------------------
11. Percent of Class Represented by Amount in Row (9)
2.1%
--------------------------------------------------------------------------------
12. Type of Reporting Person (See Instructions)
OO
Page 3 of 25
CUSIP No. 00178W105 SCHEDULE 13G
1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Wood River Partners, L.P.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ]
(b) [X]
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Citizenship or Place of Organization.
Delaware
--------------------------------------------------------------------------------
Number of 5. Sole Voting Power
153,100
---------------------------------------
Shares Beneficially 6. Shared Voting Power
0
---------------------------------------
Owned by Each 7. Sole Dispositive Power
153,100
---------------------------------------
Reporting Person With: 8. Shared Dispositive Power
0
--------------------------------------------------------------------------------
9. Aggregate Amount Beneficially Owned by Each Reporting Person
153,100
--------------------------------------------------------------------------------
10. Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
--------------------------------------------------------------------------------
11. Percent of Class Represented by Amount in Row (9)
2.1%
--------------------------------------------------------------------------------
12. Type of Reporting Person (See Instructions)
PN
Page 4 of 25
CUSIP No. 00178W105 SCHEDULE 13G
1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Wood River Partners Offshore, Ltd.
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ]
(b) [X]
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Citizenship or Place of Organization.
Cayman Islands
--------------------------------------------------------------------------------
Number of 5. Sole Voting Power
331,100
---------------------------------------
Shares Beneficially 6. Shared Voting Power
0
---------------------------------------
Owned by Each 7. Sole Dispositive Power
331,100
---------------------------------------
Reporting Person With: 8. Shared Dispositive Power
0
--------------------------------------------------------------------------------
9. Aggregate Amount Beneficially Owned by Each Reporting Person
331,100
--------------------------------------------------------------------------------
10. Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
--------------------------------------------------------------------------------
11. Percent of Class Represented by Amount in Row (9)
4.4%
--------------------------------------------------------------------------------
12. Type of Reporting Person (See Instructions)
CO
Page 5 of 25
CUSIP No. 00178W105 SCHEDULE 13G
1. Names of Reporting Persons.
I.R.S. Identification Nos. of above persons (entities only).
Arthur Steinberg, Esq., as the Receiver for the Wood River Entities(1)
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ]
(b) [ ]
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Citizenship or Place of Organization.
U.S.A.
--------------------------------------------------------------------------------
Number of 5. Sole Voting Power
0
---------------------------------------
Shares Beneficially 6. Shared Voting Power
484,200(1)
---------------------------------------
Owned by Each 7. Sole Dispositive Power
0
---------------------------------------
Reporting Person With: 8. Shared Dispositive Power
484,200(1)
--------------------------------------------------------------------------------
9. Aggregate Amount Beneficially Owned by Each Reporting Person
484,200(1)
--------------------------------------------------------------------------------
10. Check if the Aggregate Amount in Row (9) Excludes Certain Shares
(See Instructions) [ ]
--------------------------------------------------------------------------------
11. Percent of Class Represented by Amount in Row (9)
6.5%(1)
--------------------------------------------------------------------------------
12. Type of Reporting Person (See Instructions)
PN
----------
(1) See Items 2 and 4 herein.
Page 6 of 25
SCHEDULE 13G
ITEM 1.
(a) Name of Issuer:
AMS Health Sciences, Inc.
(b) Address of Issuer's Principal Executive Offices:
711 NE 39th Street
Oklahoma City, Oklahoma 73105
ITEM 2.
(a) Names of Persons Filing:
Wood River Capital Management, L.L.C.
Wood River Associates, L.L.C.
Wood River Partners, L.P.
Wood River Partners Offshore, Ltd.
Arthur Steinberg, Esq., as the Receiver of the Wood River
Entities
On October 13, 2005, Arthur Steinberg, Esq. was appointed
receiver (the "Receiver") of Wood River Capital Management, L.L.C., Wood River
Associates, L.L.C., Wood River Partners, L.P. and Wood River Partners Offshore,
Ltd. and their respective subsidiaries, successors and assigns (the "Wood River
Entities") pursuant to an order of the United States District Court for the
Southern District of New York, dated October 13, 2005, in connection with the
action entitled Securities and Exchange Commission v. Wood River Capital
Management, L.L.C., Wood River Associates, L.L.C., John Hunting Whittier, Wood
River Partners, L.P. and Wood River Partners Offshore, Ltd. (the "Order"). This
Schedule 13G is being filed by the Receiver and the Wood River Entities
(collectively, the "Reporting Persons") to report the acquisition by the
Reporting Persons of beneficial ownership of the shares set forth herein
(however, the Receiver has not yet obtained information as to the date on which
the Wood River Entities initially acquired more than five percent of the shares
of common stock of AMS Health Sciences, Inc.) Mr. Whittier is not a filer with
respect to this Schedule 13G. The information contained in this Schedule 13G
regarding the Wood River Entities, Mr. Whittier and the shares of common stock
of AMS Health Sciences, Inc. that may be beneficially owned by the Reporting
Persons is solely based upon a review of certain brokerage account statements
and account information delivered prior to the date hereof to the Receiver by
certain brokers for the Wood River Entities, as the Receiver has not yet
reviewed any other information or the books, records or accounts of the Wood
River Entities or otherwise been able to determine, verify or confirm the amount
of shares of AMS Health Sciences, Inc. that may be beneficially owned by the
Reporting Persons or the other information contained herein.
The Reporting Persons expressly disclaim knowledge as to the
completeness and the accuracy of the information contained in this Schedule 13G.
The Receiver is still in the process of exploring whether or not any other
brokers or nominees are holding additional shares of common stock of AMS Health
Sciences, Inc., with respect to which the Wood River Entities and the Receiver
may be deemed the beneficial
Page 7 of 25
owner. Similarly, the Receiver is still in the process of determining whether
any of the Wood River Entities have entered into any type of agreement,
contract, trust or other arrangement pursuant to which the Receiver and the Wood
River Entities may be deemed the beneficial owner of more or fewer shares of
common stock of AMS Health Sciences, Inc. than indicated herein. The filing of
this Schedule 13G shall not be construed as an admission that any of the
Reporting Persons is, for the purposes of Section 13(d) or 13(g) of the
Securities Exchange Act of 1934, as amended, the beneficial owner of any
securities covered by this Schedule 13G. The Receiver is in the process of
confirming and verifying the facts and circumstances stated in this Schedule
13G, and therefore, all statements made herein are made based upon the
Receiver's current information and belief and subject to confirmation,
correction, change and future amendment.
The Receiver may be deemed to share beneficial ownership of
the shares of common stock of AMS Health Sciences, Inc. reported herein due to
being appointed the Receiver of the Wood River Entities pursuant to the Order.
Pursuant to Section 13 of the Order, the Receiver is
authorized, empowered and directed to perform, among others, the following
duties and responsibilities at all times with a view towards, first, locating,
preserving and protecting all of the Wood River Entities' assets, and second,
maximizing returns to investors in the Wood River Entities: (i) locate and take
immediate possession and control of all assets of every kind whatsoever and
wherever located owned by, controlled by, belonging to, or traceable to the Wood
River Entities, whether tangible, intangible, real, equitable, personal,
realized, unrealized or otherwise (the "Assets"), and to hold, manage, and
administer such Assets as is required to comply with and effectuate the
directives of the Order; (ii) assume control of, and be named as authorized
signatory for, all accounts at any bank, brokerage firm, or financial
institution which has possession, custody or control of any Assets (the
"Accounts"); (iii) manage, retain, sell and/or liquidate the Accounts as
necessary and appropriate to comply with and effectuate the directives of the
Order; (iv) take all reasonable and necessary actions to manage, maintain, and
wind-down business operations of the Wood River Entities, including making
legally required payments to creditors, employees and agents of the Wood River
Entities; (v) communicate with vendors, investors, and others, as required to
comply with and effectuate the purposes of the Order; (vi) make or authorize
such payments and disbursements from the Assets, and incur, or authorize the
incurrence of such expenses and make, or authorize the making of such agreements
as the Receiver deems reasonable and necessary in discharging the Receiver's
duties; and (vii) develop a plan with respect to the retention, liquidation,
and/or distribution of all remaining Assets to investors in the Wood River
Entities.
A copy of the Order is attached hereto and incorporated herein
by this reference.
(b) Address of Principal Business Office or, if none, Residence:
The address of the principal business office of the Wood River
Entities and the Receiver is:
c/o Kaye Scholer LLP
425 Park Avenue
New York, NY 10022
(c) Citizenship:
Wood River Capital Management, L.L.C. is a Delaware entity
Wood River Associates, L.L.C. is a Delaware entity
Page 8 of 25
Wood River Partners, L.P. is a Delaware entity
Wood River Partners Offshore, Ltd. is a Cayman Islands entity
The Receiver is a U.S. citizen
(d) Title of Class of Securities:
Common Stock
(e) CUSIP Number:
00178W105
ITEM 3. IF THIS STATEMENT IS FILED PURSUANT TO RULE 13D-1(b) OR
13D-2(b) OR (c), CHECK WHETHER THE PERSON FILING IS A:
(a) [ ] Broker or dealer registered under section 15 of the Act
(15 U.S.C. 78o).
(b) [ ] Bank as defined in section 3(a)(6) of the Act
(15 U.S.C. 78c).
(c) [ ] Insurance company as defined in section 3(a)(19) of the
Act (15 U.S.C. 78c).
(d) [ ] Investment company registered under section 8 of the
Investment Company Act of 1940 (15 U.S.C. 80a-8).
(e) [ ] An investment adviser in accordance with Section 240.13d-1
(b)(1)(ii)(E).
(f) [ ] An employee benefit plan or endowment fund in accordance
with Section 240.13d-1(b)(1)(ii)(F).
(g) [ ] A parent holding company or control person in accordance
with Section 240.13d-1(b)(1)(ii)(G).
(h) [ ] A savings association as defined in Section 3(b) of the
Federal Deposit Insurance Act (12 U.S.C. 1813).
(i) [ ] A church plan that is excluded from the definition of an
investment company under section 3(c)(14) of the
Investment Company Act of 1940 (15 U.S.C. 80a-3).
(j) [ ] Group, in accordance with Section 240.13d-1(b)(1)(ii)(J).
ITEM 4. OWNERSHIP.
(a) Amount purportedly beneficially owned:
Wood River Capital Management, L.L.C. 484,200
Wood River Associates, L.L.C. 153,100
Wood River Partners, L.P. 153,100
Wood River Partners Offshore, Ltd. 331,100
The Receiver(1) 484,200
(b) Purported Percent of Class:
Wood River Capital Management, L.L.C. 6.5%
----------
(1) Due to the powers and authority conferred by the Order upon the
Receiver, the Receiver may be deemed to share beneficial ownership of
the shares of common stock reported herein.
Page 9 of 25
Wood River Associates, L.L.C. 2.1%
Wood River Partners, L.P. 2.1%
Wood River Partners Offshore, Ltd. 4.4%
The Receiver(1) 6.5%
(c) Number of shares as to which each Reporting Person purportedly
has:
(i) Sole power to vote or to direct the vote:
Wood River Capital Management, L.L.C. 0
Wood River Associates, L.L.C. 0
Wood River Partners, L.P. 153,100
Wood River Partners Offshore, Ltd. 331,100
The Receiver(1) 0
(ii) Shared power to vote or to direct the vote:
Wood River Capital Management, L.L.C. 484,200
Wood River Associates, L.L.C. 153,100
Wood River Partners, L.P. 0
Wood River Partners Offshore, Ltd. 0
The Receiver(1) 484,200
(iii) Sole power to dispose or to direct the disposition
of:
Wood River Capital Management, L.L.C. 0
Wood River Associates, L.L.C. 0
Wood River Partners, L.P. 153,100
Wood River Partners Offshore, Ltd. 331,100
The Receiver(1) 0
(iv) Shared power to dispose or to direct the disposition
of:
Wood River Capital Management, L.L.C. 484,200
Wood River Associates, L.L.C. 153,100
Wood River Partners, L.P. 0
Wood River Partners Offshore, Ltd. 0
The Receiver(1) 484,200
ITEM 5. OWNERSHIP OF FIVE PERCENT OR LESS OF A CLASS.
If this statement is being filed to report the fact that as of the date
hereof the reporting person has ceased to be the beneficial owner of more than
five percent of the class of securities, check the following [ ].
Page 10 of 25
ITEM 6. OWNERSHIP OF MORE THAN FIVE PERCENT ON BEHALF OF ANOTHER
PERSON.
Mr. John H. Whittier was the principal and managing member of Wood
River Capital Management, L.L.C. and Wood River Associates, L.L.C. Due to the
powers and authority conveyed upon the Receiver, by the Order, the Receiver may
be deemed to share beneficial ownership of the shares of common stock reported
herein. See Exhibit 1.
ITEM 7. IDENTIFICATION AND CLASSIFICATION OF THE SUBSIDIARY WHICH
ACQUIRED THE SECURITY BEING REPORTED ON BY THE PARENT HOLDING
COMPANY.
See Exhibit 1.
ITEM 8. IDENTIFICATION AND CLASSIFICATION OF MEMBERS OF THE GROUP.
See Exhibit 1.
ITEM 9. NOTICE OF DISSOLUTION OF GROUP.
Not applicable.
ITEM 10. CERTIFICATION.
Subject to the information set forth in Item 2 hereof, by signing below
I certify that, to the best of my knowledge and belief, the securities referred
to above were not acquired and are not held for the purpose of or with the
effect of changing or influencing the control of the issuer of the securities
and were not acquired and are not held in connection with or as a participant in
any transaction having that purpose or effect.
Page 11 of 25
SIGNATURE
Subject to the information set forth in Item 2 hereof, after reasonable
inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
Date: November 1, 2005
ARTHUR STEINBERG, ESQ., as the Receiver of
the Wood River Entities to the extent
contemplated by the Order, a copy of which
is annexed hereto.
By: /s/ Arthur Steinberg
----------------------------------------
Name: Arthur Steinberg
Title: Receiver
Page 12 of 25
ANNEX A
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
SECURITIES AND EXCHANGE COMMISSION
Plaintiff,
-against-
WOOD RIVER CAPITAL MANAGEMENT, LLC, 05 Cv. 8713
WOOD RIVER ASSOCIATES, LLC,
JOHN HUNTING WHITTIER,
WOOD RIVER PARTNERS, L.P., and
WOOD RIVER PARTNERS OFFSHORE, LTD.,
Defendants.
STIPULATION AND ORDER GRANTING
PRELIMINARY INJUNCTION,
FREEZING ASSETS AND APPOINTING RECEIVER
---------------------------------------
WHEREAS, Plaintiff Securities and Exchange Commission ("Commission")
and the defendants have agreed and stipulated to a preliminary injunction
against defendants, enjoining them from violating the federal securities laws;
preserving evidence; freezing assets; ordering an accounting; and appointing a
receiver for certain defendants;
WHEREAS, counsel for the Defendant Whittier has reviewed the complaint
and this Order and has consented to the immediate entry of this Order; without
an adjudication of the merits on any issue of fact or law;
WHEREAS, this Order is designed to effectuate dual goals: first,
locating, preserving and protecting investor money, and second maximizing
returns available to investors;
WHEREAS, the Commission has submitted the credentials of a candidate to
be appointed Receiver of all of the assets, properties, and books and records of
defendants Wood River Asset Management, LLC, Wood River Associates, LLC, Wood
River Partners, L.P., and Wood River
13 of 25
Partners Offshore, Ltd. (the "Wood River Entity Defendants"), and assets
traceable to the Wood River Entity Defendants, and the Commission has advised
the Court that this candidate is prepared to assume this responsibility if so
ordered by the Court;
WHEREAS, the Court having considered the Commission's Application for
Entry of an Order Granting Preliminary Injunction, Freezing Assets, and
Appointing a Receiver;
WHEREAS, the Court finds that the relief set forth in the Order is
necessary and appropriate for the benefit of investors who may have been injured
as a result of the conduct alleged in this lawsuit;
WHEREAS, the Court is authorized to grant the relief set forth in the
Order pursuant to the Federal Rules of Civil Procedure, its general equitable
authority and also pursuant to Section 21(d)(5) of the Securities Exchange Act
of 1934 [15 U.S.C. ss. 78u(d)(5)].
NOW, THEREFORE, IT IS ORDERED, ADJUDGED, AND DECREED as follows:
I.
PRELIMINARY INJUNCTION PRECLUDING
VIOLATIONS OF THE FEDERAL SECURITIES LAWS
-----------------------------------------
1. Defendants, their officers, agents, servants, employees, attorneys,
successors-in-interest, and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or
otherwise, and each of them, shall be and hereby are preliminarily restrained
and enjoined, pending entry of a Final Judgment in this action, from violating,
directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934
(the "Exchange Act") [15 U.S.C. ss. 78j(b)] and Rule 10b-5 promulgated
thereunder [17 C.F.R. ss. 240.10b-5], by using any means or instrumentality of
interstate commerce, or of the mails, or of any facility of any national
securities exchange, in connection with the purchase or sale of any security:
(a) to employ any device, scheme, or artifice to defraud; (b) to make any untrue
statement of a material fact or to omit to state a material fact necessary in
order to make the
14 of 25
statements made, in the light of the circumstances under which they were made,
not misleading; or (c) to engage in any act, practice, or course of business
which operates or would operate as a fraud or deceit upon any person.
2. Defendants, their officers, agents, servants, employees, attorneys,
successors-in-interest, and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or
otherwise, and each of them, shall be and hereby are preliminarily restrained
and enjoined, pending entry of a Final Judgment in this action, from violating,
directly or indirectly, Section 17(a) of the Securities Act [15 U.S.C. ss.
77q(a)], by, in the offer or sale of any security using any means or instruments
of transportation or communication in interstate commerce or by use of the
mails, directly or indirectly: (a) to employ any device, scheme, or artifice to
defraud; (b) to obtain money or property by means of any untrue statement of a
material fact or any omission of a material fact necessary in order to make the
statements made, in light of the circumstances under which they were made, not
misleading; or (c) to engage in any transaction, practice, or course of business
which operates or would operate as a fraud or deceit upon the purchaser.
3. Defendants Wood River Asset Management, LLC, Wood River Associates,
LLC, John Hunting Whittier, their officers, agents, servants, employees,
attorneys, successors-in-interest, and those persons in active concert or
participation with them who receive actual notice of this Order by personal
service or otherwise, and each of them, shall be and hereby are preliminarily
restrained and enjoined, pending entry of a Final Judgment in this action, from,
by use of the mails or any means or instrumentality of interstate commerce: (1)
employing any device, scheme, or artifice to defraud; and/or (2) engaging in any
act, practice or course of business which would operate as a fraud or deceit
upon any client or prospective client, in
15 of 25
violation of Section 206(1) and (2) of the Investment Advisers Act of 1940 [15
U.S.C. ss. 80b-6(1) and (2)].
4. Defendants, their officers, agents, servants, employees, attorneys,
successors-in-interest, and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or
otherwise, and each of them, shall be and hereby are preliminarily restrained
and enjoined, pending entry of a Final Judgment in this action, from violating,
directly or indirectly, Section 13(d) of the Exchange Act [15 U.S.C. ss. 78m(d)]
and Rules 13d-1 and 13d-2 thereunder [17 C.F.R. ss.ss. 240.13d-1 and 240.13d-2]
by failing to: (a) within ten days of acquiring beneficial ownership of more
than five percent of any equity security registered pursuant to Section 12 of
the Exchange Act: (i) file a complete and accurate Schedule 13D with the
Commission; and (ii) send to the issuer of such security, and each exchange
where such security is traded, a statement describing the purchases and other
information; or (b) amend a Schedule 13D if there is any material change in the
beneficial ownership position in the security noted therein, or any other facts
set forth in a previously filed Schedule 13D.
5. Defendants, their officers, agents, servants, employees, attorneys,
successors-in-interest, and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or
otherwise, and each of them, shall be and hereby are preliminarily restrained
and enjoined, pending entry of a Final Judgment in this action, from violating,
directly or indirectly, Section 16(a) of the Exchange Act [15 U.S.C. ss.
78p(a)], and Rules 16a-2 and 16a-3 thereunder [17 C.F.R. ss. 240.16a-2 and
240.16a-3], by failing to file timely with the Commission (and, if such security
is registered on a national securities exchange, also with the exchange), as a
direct or indirect beneficial owner of more than 10 percent of any
16 of 25
class of any equity security (other than an exempted security) which is
registered pursuant to Section 12 of the Exchange Act [15 U.S.C. ss. 78l], or as
a director or an officer of the issuer of such security: (a) at the time of the
registration of such security on a national securities exchange or by the
effective date of a registration statement filed pursuant to Section 12(g) of
the Exchange Act [15 U.S.C. ss. 78l(g)], or within ten days after becoming such
a beneficial owner, director, or officer, a statement on Form 3 [17 C.F.R. ss.
249.103], Initial Statement of Beneficial Ownership of Securities, of the amount
of all equity securities of such issuer of which he is the beneficial owner; (b)
within ten days after the close of each calendar month thereafter, if there has
been a change in such ownership during such month, a statement on Form 4 [17
C.F.R. ss. 249.104], Statement of Changes in Beneficial Ownership of Securities,
indicating ownership at the close of the calendar month and such changes in
ownership as have occurred during such calendar month; and (c) within forty-five
days of the issuer's year-end, a statement on Form 5 [17 C.F.R. ss. 249.105],
Annual Statement of Beneficial Ownership of Securities, disclosing, among other
things, all holdings and transactions that should have been, but were not,
reported on Forms 3, 4, or 5 during the most recent fiscal year.
II.
FULL ACCOUNTING OF ASSETS
-------------------------
6. Defendant Whittier shall, subject to, and without waiver of, any
applicable privilege, within ten (10) days of receipt of this Order, serve upon
the Commission a sworn accounting of all funds and other assets that he owns,
possesses, or controls, or has a beneficial interest in, or has a right to own,
possess, or control, in whatever form, and wherever located. The accounting
provided in this paragraph shall include, but is not limited to: (1) providing a
detailed description of such funds and assets; (2) reporting on the disposition
and current location of the funds and assets; and (3) disclosing all bank and
brokerage account numbers where these
17 of 25
funds and assets have been deposited. Defendant Whittier shall also provide an
accounting of all monies received from and paid to the Wood River Entity
Defendants since January 1, 2004.
III.
WOOD RIVER ENTITIES ASSET FREEZE
--------------------------------
7. The Wood River Entity Defendants, their officers, agents, servants,
employees, attorneys, successors-in-interest, and those persons in active
concert or participation with them who receive actual notice of this Order by
personal service or otherwise, and each of them, shall hold and retain within
their control, and otherwise prevent any disposition, transfer, pledge,
encumbrance, assignment, dissipation, concealment or other disposal whatsoever,
by themselves or any person or entity under their direct or indirect control, of
any funds or assets, in their name, for their benefit or under their control.
8. Any institution or person or entity holding any funds, accounts or
other assets in the name, for the benefit or under the control of the Wood River
Entity Defendants, or where the Wood River Entity defendants are signatories or
have signing authority, and which receives actual notice of this Order by
personal service or otherwise, shall hold and retain within its control and
prohibit the withdrawal, removal, transfer or other disposal of any funds or
other assets in the name, for the benefit or under the control of any of the
Wood River Entity Defendants.
IV.
THE WHITTIER PARTIAL ASSET FREEZE
---------------------------------
9. Defendant Whittier shall provide plaintiff with at least three business day's
advance written notice of any proposed transfer, disposition, sale, or
encumbrance of any asset in which Whittier has an interest (the "Transaction")
if the amount or value of the Transaction exceeds $10,000. Plaintiff shall then
have three business days in which to provide Whittier's
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counsel with a written objection to the proposed Transaction including a
specific basis for the objection. If Defendant Whittier wishes to pursue the
Transaction despite plaintiff's written objection, he shall do so only after
seeking (and obtaining) the Court's approval, with notice to plaintiff. Notice
and objections shall be sent by fax and electronic mail to counsel of record,
respectively, for plaintiff and Defendant Whittier. This procedure for approving
or objecting to transactions shall be called the "Approval Mechanism." If
seeking Court approval for a Transaction to which plaintiff has objected,
Whittier may do so in an expedited fashion via letter to the Court.
10. Defendant Whittier's expenditures in any calendar month shall not
exceed $15,000, exclusive of attorneys' fees (the "Expenditure Cap"). If
Whittier wishes to exceed the Expenditure Cap, he shall seek and obtain approval
pursuant to the Approval Mechanism.
11. Three business day after the end of each calendar month, Defendant
Whittier shall provide a report to counsel of record for plaintiff of all
expenditures in excess of $1,000 that he made that month, including attorneys'
fees.
V.
RESTRAINT FROM DESTRUCTION OF EVIDENCE
--------------------------------------
Defendants, their officers, agents, servants, employees, attorneys,
successors-in-interest, and those persons in active concert or participation
with them who receive actual notice of this Order by personal service or
otherwise, and each of them, are hereby restrained from destroying, mutilating,
concealing, altering or disposing of any document or other record or data
referring or relating in any manner to (1) the acts, practices and transactions
described in the complaint in this action, (2) communications between or among
the defendants and their agents; and (3) funds or other assets that any of the
defendants have received from investors.
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VI.
APPOINTMENT OF RECEIVER
-----------------------
12. Arthur Steinberg is hereby appointed the Receiver for the Wood River
Entities, and their subsidiaries, successors and assigns during the pendancy of
this litigation, or until further direction of the Court.
13. The Receiver is authorized, empowered and directed to perform the
following duties and responsibilities, at all times with a view towards, first,
locating, preserving and protecting all of Wood River Entity defendants' assets,
and second, maximizing returns to investors:
a. PRESERVATION OF ASSETS. Locate and take immediate possession
and control of all assets of every kind whatsoever and wherever located owned
by, controlled by, belonging to, or traceable to Wood River Entities, whether
tangible, intangible, real, equitable, personal, realized, unrealized, or
otherwise (the "Assets"), and to hold, manage, and administer such Assets as is
required to comply with and effectuate the directives of this Order;
b. IDENTIFICATION OF ASSETS AND LIABILITIES. Prepare a full
accounting of all Assets. Present to the Court and the Commission within 60 days
of the date of this Order a report reflecting the existence and value of the
Assets, including all liabilities.
c. IDENTIFICATION OF ASSETS SUBJECT TO FREEZE. Investigate the
past and current operations and transactions of the defendants, and within 60
days of the date of this Order, submit a report to the Court identifying those
persons and entities who have received, or are in possession, of any Assets. The
report shall include an analysis of all returns and redemptions that investors
in the Wood River Entities received from February 2003 to the present, including
any interest or earnings on investments.
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d. ASSUME CONTROL OVER THE DEFENDANTS' ACCOUNTS. Assume control
of, and be named as authorized signatory for, all accounts at any bank,
brokerage firm, or financial institution which has possession, custody or
control of any Assets (the "Accounts"). Manage, retain, sell and/or liquidate
the Accounts as necessary and appropriate to comply with and effectuate the
directives of this Order.
e. SECURE, MANAGE AND DISCONTINUE ON-GOING BUSINESS OPERATIONS.
Secure the business premises, and all business equipment, data and documents, of
the Wood River Entity defendants. Take control of all means of communication
with investors, vendors, agents, and others doing business with these
defendants. Take all reasonable and necessary actions to manage, maintain, and
wind-down business operations of the Wood River Entity defendants, including
making legally required payments to creditors, employees and agents of these
defendants. Communicate with vendors, investors, and others, as required to
comply with and effectuate the purposes of this Order.
f. INSTITUTE, DEFEND, COMPROMISE OR SETTLE LEGAL ACTIONS.
Institute, prosecute, defend and settle any legal actions on behalf of the
Receivership to comply with and effectuate the purposes of this Order;
g. AUTHORIZE PAYMENTS. Make or authorize such payments and
disbursements from the Assets, and incur, or authorize the incurrence of such
expenses and make, or authorize the making of such agreements as the Receiver
deems reasonable and necessary in discharging the Receiver's duties.
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h. ACCESS TO CORPORATE DOCUMENTS AND COMPUTERS. Have complete and
unfettered access to all documents, books and records of the Wood River Entity
defendants, wherever located, and in whatever form or format they exist.
i. DISPOSITION PLAN. Develop a plan with respect to the retention,
liquidation, and/or distribution of all remaining Assets to investors.
j. BANKRUPTCY. If appropriate, file for bankruptcy or liquidation,
on behalf of the Wood River Entities, after notice to all parties in this
action.
k. INVESTOR COMMUNICATIONS. Use best efforts to consult with the
Wood River Partners L.P. limited partners and the Wood River Partners Offshore
Ltd. shareholders and their representatives and to consider their reasonable
requests or suggestions.
15. The Receiver is entitled to payment for all reasonable costs, fees
and other expenses incurred in the performance of his duties, and to engage and
retain attorneys, accountants, securities professionals, and other persons or
entities to assist in carrying out this Order. The Receiver shall not retain
such persons or entities without the prior consent of the staff of the
Commission. The Receiver shall disclose to the Commission's counsel of record
all financial arrangements with such persons or entities.
16. The Receiver shall, at such times as he deems appropriate, submit
fee applications for his services and the services of persons he retains, plus
expenses, to the Court for approval before payment. Payment of all such fees and
expenses shall be made from the Assets.
17. The Receiver shall give the Commission counsel of record at least
ten (10) days notice of all of his applications to the Court under this Order,
including all applications for disbursements from the Assets. The Commission
shall be permitted to submit to the Court for
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consideration its position on the reasonableness of the Receiver's application.
All of the Receiver's requests for payments of fees or expenses must be approved
by the Court before payment of such fees or expenses are made, and the Court
will review the reasonableness of such fees and expenses in determining whether,
in its equitable discretion, such payment will be approved. The Receiver is not
required to seek prior Court approval of payments made for any federal, state or
local taxes that may be applicable.
18. Applications for disbursement shall include the appropriate
supporting documentation to justify the expense or service rendered. Charges for
services shall include (a) the date of the service; (b) the name or initials of
the individual rendering the service; (c) a description of the service; (d) the
hourly rate; (e) the time charged; and (f) the amount (rate x time). The
description of the service or activity should be brief and informative. Expenses
shall be supported by invoices.
19. The Receiver, along with any persons or firms retained by the
Receiver pursuant to this Order, shall be entitled to rely on all outstanding
rules of law and court orders and shall not be liable to anyone for his or their
own good faith compliance with any order, rule, law, judgment or decree,
including those issued or enacted in foreign jurisdictions. In no event shall
the Receiver or any person or firm retained by the Receiver in this action be
liable to anyone for his, her, its or their good faith compliance with the
duties and responsibilities as Receiver or as counsel for or consultant to the
Receiver. Nor shall the Receiver or any person or firm retained by the Receiver
in this matter be liable to anyone for any actions taken or omitted by them
except on a finding by this Court that he, she, it or they acted or failed to
act as a result of misfeasance, bad faith or gross negligence or in reckless
disregard of his, her, its or their duties.
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20. The Receiver is excused from all legal requirements to post a bond
or to give an undertaking of any type in connection with his fiduciary duties.
21. The Receiver may be removed at any time by the Court and replaced
with a successor. In the event the Receiver decides to resign, the Receiver
shall first give written notice to the parties and the Court of his intention,
and his resignation shall not be effective until the Court appoints a successor.
The Receiver shall then follow such instructions as his successor or the Court
may provide.
22. All persons who receive actual notice of this Order by personal
service or otherwise are enjoined from in any way disturbing the Assets; from
appointing a receiver, liquidator or administrator; and from filing or
prosecuting any judicial action or proceeding of any kind, civil or criminal
(including any bankruptcy proceeding with respect to the Wood River Entities)
which involves the Receiver or which affects the Assets, except on leave having
been granted by this Court. The Receiver shall not be required to respond to any
subpoena or other court process (for documents or testimony) relating to the
Receiver's duties except on order of this Court.
23. On the request of the Commission, the Receiver shall provide the
Commission with any documentation that the Commission deems necessary to meet
its reporting requirements, that is mandated by statute or Congress, or that is
otherwise necessary to further the Commission's mission.
* * * * * * * * *
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24. This Stipulation and Order is entered into without prejudice to
defendants' rights to file a motion to transfer venue of this case to the U.S.
District Court for the Northern District of California following the entry of
this Order.
SO AGREED:
/s/ John H. Whittier /s/ John H. Whittier
-------------------------------------- ---------------------------------------
JOHN HUNTING WHITTIER WOOD RIVER ASSET
By MANAGEMENT, LLC
Dated: 10/12/05 By
Dated: 10/12/05
/s/ John H. Whittier /s/ John H. Whittier
-------------------------------------- ---------------------------------------
WOOD RIVER ASSOCIATES, LLC WOOD RIVER PARTNERS, L.P.
By By
Dated: 10/12/05 Dated: 10/12/05
/s/ John H. Whittier
--------------------------------------
WOOD RIVER PARTNERS
OFFSHORE, LTD.
By
Dated: 10/12/05
/s/ Elliot R. Peters /s/ Kevin P. O'Rourke
-------------------------------------- ---------------------------------------
ELLIOT R. PETERS KEVIN P. O'ROURKE
Keker & Van Nest LLP 100 F. Street, N.E.
710 Sansome Street Washington, D.C. 20549
San Francisco, CA 94111 (202) 551-4442
(415) 676-2273 Counsel for the Securities and Exchange
Counsel for John Hunting Whittier Commission
Dated: 10/12/05 Dated: 10/12/05
SO ORDERED
/s/ John G. Koeltl
---------------------------------------
United State District Judge
10/13/05
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