10.21.08 Receiver's Office Examines Nations Warranty Books

The Receiver has been in the Nations Warranty offices since his appointment on October 2, 2008, and has made himself familiar with the operations of the company. His CPA/Certified Fraud Examiner has examined the company’s books. The Receiver will be making a decision shortly regarding whether to continue operating the company. Rest assured that the Receiver is considering all options and will make the decision that maximizes recovery to the investors. Please check back periodically for further updates, and call the Receiver’s office at 770-919-8003 if you have further questions.

10.27.08 Finance Companies Release Money to Nations Warranty

Good news. The finance companies that were holding back money from our warranty sales have agreed to open up the pipeline, allowing more cash to flow into the business. The Receiver’s team is working hard on a plan to make Nations Warranty profitable so that it can generate money for repayment to note holders. This will take some time, but the Receiver has directed the Nations Warranty staff to go forward with a new mailing which should generate calls to keep cash flowing into the business. With substantial cuts in operating expenses, we hope to be able to weather the traditionally lean winter months and see substantial profits after the holidays.

We will be filing our first Interim Report with Judge Martin within the next thirty days. Along with that report, we will file a motion seeking approval of a claims procedure that will allow us to obtain information we need to ensure that we return the proper amount to each note holder.

The delay inherent in receivership cases is always frustrating. Rest assured that the Receiver and his team are working with a sense of urgency so that any return to note holders takes place not one day later than is possible.

12.05.08 First Interim Report Posted Online

The Receiver today filed his First Interim Report detailing what he found upon entering Nations Warranty and JW&P Consulting, what he has done to gather and protect receivership assets and limit liabilities, and what his plans are for the immediate future.

The Receiver also filed a Motion to Approve Claim Form and Establish a Bar Date for Claims. A claims process will speed recovery for approved claimants.

The Receiver expects to file his next interim report in early March 2009 and to post significant case updates on the Web site between now and then.

02.09.09 Public Hearing Scheduled for February 12

Judge Martin has scheduled a hearing for February 12, 2009 at 10am. The Notice of Hearing is available on the Nations Warranty Documents page here. At this hearing, she will likely rule on the Amended Motion to Approve Claim Form (also posted on the Nations Warranty Documents page) which proposes a Bar Date of March 30, 2009, as well as rule on the Receiver’s first fee application and several other pending motions. The hearing is open to the public.

02.10.09 Operations Ceased at Nations Warranty Group

Thanks to all who have called to check the status of our efforts to gather assets for eventual distribution. We have made substantial progress on several fronts, and the prospects look brighter than they did when the Court initially appointed us.

In the best interests of prospective claimants, we have ceased operations at Nations Warranty Group. Although we succeeded in continually reducing the cost per sale, and the record-setting closing rates by the excellent salespeople who remained produced better sales this December and January than for the same period last year, the pace of cancellations of pre-receivership sales has overwhelmed any benefit derived from those sales. No doubt, the historic economic downturn has had an impact and will continue to have an impact. Thankfully, we have other avenues of recovery.

Our pre-claims process calculations show roughly $1.8 million in likely claims by note holders. We have identified roughly $1.6 million in promising claims against parties involved in the operations described in the SEC’s complaint. We are working now to convert those claims into cash, and we are making good progress in that regard. Depending on the success of those efforts, there may be more money to distribute than appeared likely in October.

There is a hearing scheduled for 10 a.m. on February 12, 2008, in Judge Martin’s courtroom. Among the matters to be discussed is the Receiver’s first fee application, which requests approximately $77,000 for work completed in the first 30 days of the receivership. The Receiver will not submit another fee application until the above-referenced collection efforts come into sharper focus, and — as is his practice — will maintain a close watch on expenses to ensure that his invoices reflect efforts that provide a tangible benefit to claimants.

Thanks also to those of you who have called for clarification on how the Receiver is paid. As we’ve described, the Receiver is paid out of the assets of the receivership estate. In many cases, including this one, both the Receiver and prospective claimants are dependent on the success of collection efforts to receive any payment. This means that, while the Receiver is paid from the receivership assets, it is the Receiver’s efforts which make the payment of claims possible by identifying, locating and securing those assets, and monetizing their value for the benefit of the receivership estate.

All good Receivers measure their success by the return to approved claimants, and not by the size of their fees. By aggressively pursuing claims, this Receiver expects to continue his previous success in this case.

We welcome your questions.

10.01.09 Second Interim Report Posted Online

The Receiver has filed his second interim report with the Court. You can find it on the Nations Warranty Documents page here.

02.14.11 Receiver's Third Interim Report Posted Online

The Receiver has filed his third interim report with the Court. You can find it on the Nations Warranty Documents page here.

04.06.11 Receiver's Plan of Distribution Filed with the Court

The Receiver has filed a motion with the Court to approve his plan of distribution. The plan is accompanied by a brief in support of his plan and an exhibit, both of which have been posted to this web site. You can find both documents on the Nations Warranty Documents page here.

04.26.11 Proposed Order Approving Receiver's Plan of Distribution Posted Online

The Court has approved the Receiver's plan of distribution. A draft of the Court-approved Order has been posted to this web site on the Nations Warranty Documents page.

05.30.11 Final Order Approving Receiver's Plan of Distribution Posted Online

The Court has approved the Receiver's plan of distribution. The final Court-approved Order has been posted to this web site on the Nations Warranty Documents page.