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1 DEBTOR’S MOTION FOR ENTRY OF AN ORDER (A) EXTENDING THE EXCLUSIVITY PERIODS AND (B)

GRANTING RELATED RELIEF

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JAMES ANDREW HINDS, JR. (SBN 71222) [email protected] RACHEL M. SPOSATO (SBN 306045) [email protected] THE HINDS LAW GROUP, APC 21257 Hawthorne Blvd., Second Floor Torrance, California 90503 Telephone: (310) 316-0500 Facsimile: (310) 792-5977 General Bankruptcy Counsel for Chineseinvestors.com, Inc., Chapter 11 Debtor and Debtor-In-Possession

UNITED STATES BANKRUPTCY COURT

CENTRAL DISTRICT OF CALIFORNIA

LOS ANGELES DIVISION

In re: CHINESEINVESTORS.COM, INC.,

Debtor and Debtor-In-Possession.

Case No.: 2:20-bk-15501-ER (Chapter 11) DEBTOR’S MOTION FOR ENTRY OF AN ORDER (A) EXTENDING THE EXCLUSIVITY PERIODS AND (B) GRANTING RELATED RELIEF Date: November 4, 2020 Time: 10:00 a.m. Place: 255 E. Temple St., Courtroom 1568 Los Angeles, CA 90012 (Appearances by Telephone Only)

TO THE HONORABLE ERNEST M. ROBLES, BANKRUPTCY JUDGE, THE

OFFICE OF THE UNITED STATES TRUSTEE, THE OFFICIAL COMMITTEE OF

CREDITORS AND THEIR PROFESSIONALS, THE EXAMINER APPOINTED IN THIS

MATTER, AND ALL PARTIES WHO HAVE REQUESTED NOTICE:

Case 2:20-bk-15501-ER Doc 193 Filed 10/06/20 Entered 10/06/20 10:01:49 DescMain Document of 22



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CHINESEINVESTORS.COM, INC., debtor and debtor-in-possession in the Chapter

11 Case (hereinafter referred to as the “Debtor”), files this Motion for Entry of an Order (A)

Extending The Exclusivity Periods and (B) Granting Related Relief (hereinafter referred to

as the “Motion”). In support of its Motion the Debtor states as follows:

I.

PRELIMINARY STATEMENT

By this Motion the Debtor seeks a 120-day extension of the so-called exclusivity

period under 11 U.S.C. § 1121(b) so that the Debtor can complete its submission of a Plan

of Reorganization in this case unhindered by undue pressure from third-parties. Cause

exists for an extension given the Debtor’s good faith efforts to move this case forward to a

successful conclusion, the recent appointment of an Examiner in the case (see Docket Item

No. 160), and the Debtor’s extensive efforts to provide raw data to the Official Committee of

Creditors Holding Unsecured Claims (hereinafter referred to as the “Committee”) and the

Examiner on the Debtor’s businesses.

II.

RELIEF REQUESTED

The Debtor seeks entry of an Order from this Court (a) extending, by 120-days, (i)

the period during which only the Debtor has the exclusive right to file a Plan (hereinafter the

“Exclusive Filing Period”) through and including February 13, 2021, and (ii) the period

during which the Debtor has the exclusive right to solicit a Plan (hereinafter the “Exclusive

Solicitation Period,” and, together with the Exclusive Filing Period, the “Exclusive Periods”)

through and including April 14, 2021; and (b) granting such other and further relief as this

Court deems just and proper under the circumstances.

/ / /

/ / /

/ / /




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III.

JURISDICTION

The Court has jurisdiction to consider this matter pursuant to 28 U.S.C. § 1334. This

matter is a core proceeding pursuant to 28 U.S.C. § 157(b)(2). Venue is proper before the

Court pursuant to 28 U.S.C. §§ 1408 and 1409. The statutory and other bases for the relief

requested in the Motion are §§ 105(a) and 1121 of title 11 of the United States Code

(hereinafter the “Bankruptcy Code”), as complemented by the Federal Rules of Bankruptcy

Procedure (hereinafter the “Bankruptcy Rules”), and the Bankruptcy Local Rules.

IV.

PROCEDURAL BACKGROUND

On June 18, 2020, the Debtor filed with this Court a voluntary petition for relief under

chapter 11 of the Bankruptcy Code. The Debtor is a publicly-traded company that offers a

proprietary financial news, media and content platform providing information to the global

Chinese-speaking community, in China, the United States, Canada, and around the world,

and is managing its real and personal property as a debtor and debtor-in-possession

pursuant to §§ 1107(a) and 1108 of the Bankruptcy Code.

On July 13, 2020, the US Trustee appointed the Committee in the case. The

Committee has retained professionals to assist the Committee in its duties in the case.

(See Docket Items Nos. 153 and 154.)

At the request of the US Trustee, on August 14, 2020, US Trustee, the Debtor, and

the Committee executed a Stipulation for the Appointment of an Examiner under §1104 of

the Code. On August 19, 2020, the Court entered an Order approving the parties’

Stipulation and Howard Grobstein was appointed the Examiner in the case.

During the month of September the Committee, the Examiner and the Debtor

discussed the scope of the Examiner’s mandate, the Examiner’s initial request for

documents and data from the Debtor, and the need for a Protective Order to shield if

necessary private and confidential information to be shared with the Examiner in the case.




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On or about September 17, 2020, the parties agreed that the existing Protective Order in

place between the Debtor and the Committee would be extended to and encompass the

Examiner. The Debtor is now producing documents as requested by the Examiner. The

Debtor believes that well before the hearing date on this Motion the Debtor will have

supplied the Examiner with all documents needed for the Examiner to complete his

assignment. As of the date of this Motion the Examiner has yet to render his final report in

the case.

V.

BASIS FOR RELIEF REQUESTED

A. The Debtor Must Show That “Cause” Exists To Extend The Exclusive Period.

The Bankruptcy Code provides for an initial period of one-hundred and twenty (120)

days after the commencement of a chapter 11 case during which a debtor has the exclusive

right to file a Plan. See 11 U.S.C. § 1121(b) (“Except as otherwise provided in this section,

only the debtor may file a plan until after 120 days after the date of the order for relief under

this chapter.”). The Bankruptcy Code further provides that if a debtor files a plan within that

120-day period, it has a 180-day period from its petition date to solicit acceptance of its

plan. 11 U.S.C. § 1121(c)(3). Pursuant to §section 1121(d) of the Bankruptcy Code, the

Bankruptcy Court may extend the Exclusive Periods “for cause.” See 11 U.S.C. § 1121(d)

(“[O]n the request of a party in interest made within the respective periods specified in

subsections (b) and (c) of this section and after notice and a hearing, the court may for

cause reduce or increase the 120-day period or the 180-day period referred to in this

section.”).

Although the Bankruptcy Code does not define the term “cause” for purposes of §

1121(d) or establish formal criteria for an extension of the Exclusive Periods, bankruptcy

courts have discretion to extend exclusivity to promote the orderly, consensual, and

successful reorganization of a debtor’s affairs. See First Am. Bank v. Sw. Gloves & Safety

Equip., Inc., 64 B.R. 963, 965 (D. Del.1986) (“Section 1121(d) provides the Bankruptcy




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Court with flexibility to either reduce or increase that period of exclusivity in its discretion.”).

This is in keeping with the purpose of the Bankruptcy Code's exclusivity period, which is to

allow the debtor flexibility to negotiate with its creditors. See In re Ames Dep't Stores Inc.,

1991 WL 259036 *3 (S.D.N.Y. Nov. 25, 1991). 25, 1991).

Bankruptcy courts in this district routinely grant extensions of exclusive periods to

provide ample opportunity for debtors to develop a chapter 11 plan. See, e.g., In re Verity

Health System of California, Inc., Case No. 2:18-bk-20151-ER, ECF No.1168 (extending

Exclusivity Periods to 240 and 300 days after the petition date); In re Brotman Medical

Center, Inc., Case No. 2:07-bk-19705-BB, ECF No. 783 (Bankr. C.D. Cal. Sept. 9, 2008)

(extending Exclusivity Periods to 315 and 375 days after the petition date); In re National R.

V. Holdings, Inc., Case No, 6:07-bk- 17941-PC, ECF No. 386 (Bankr. C.D. Cal. Mar. 26,

2008) extending Exclusivity Periods to 210 and 270 days after the petition date); In re

People's Choice Home Loan, Inc., Case No. 8:07-bk-10765-RK, ECF No. 809 (Bankr. C.D.

Cal. Jan. 8, 2008) (extending Exclusivity Periods to 317 and 377 days after the petition

date). For the reasons detailed below, the same relief should be granted here.

B. Relevant Factors To Be Considered.

The courts have developed a list of several factors to consider in determining

whether a debtor has had an adequate opportunity to negotiate a chapter 11 plan and thus

whether cause exists to extend the Exclusive Periods under § 1121(d) of the Bankruptcy

Code:

1. the size and complexity of the case;

2. the necessity of sufficient time to permit the debtor to negotiate a plan and

prepare adequate information;

3. the existence of good faith progress toward reorganization;

4. the fact that the debtor is paying its bills as they become due;

5. whether the debtor has demonstrated reasonable prospects for filing a viable

plan;

6. whether the debtor has made progress in negotiations with its creditors;




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7. the amount of time which has elapsed in the case;

8. whether the debtor is seeking an extension of exclusivity to pressure creditors

to submit to the debtor's reorganization demands; and

9. whether an unresolved contingency exists.

In re New Meatco Provisions, LLC, No. 2:13-BK-22155-PC, 2014 WL 917335, at *3 (Bankr.

C.D. Cal. Mar. 10, 2014); In re Catholic Bishop of N. Alaska, No. F08-00110-DMD, 2009 WL

8412171, at *1 (Bankr. D. Alaska Sept. 11, 2009); In re Adelphia Commc’ns Corp., 352 B.R.

578, 587 (Bankr. S.D. NY 2006) (noting that the nine factors listed above are “objective

factors which courts historically have considered in making determinations of this

character”); In re McLean Indus., Inc., 87 B.R. 830, 834 (Bankr. S.D.N.Y. 1987); accord In re

Express One, 194 B.R. at 100 (identifying all of the nine factors as relevant in determining

whether cause exists to extend exclusivity); In re United Press Int’l, Inc., 60 B.R. 265, 269

(Bankr. D.C. 1986) (holding that debtor showed cause to extend exclusive period based

upon certain of the nine factors). The exercise of the Court’s discretion is not simply a

check-off process, but is based upon the totality of the circumstances. The above factors

are not the exclusive bases for the exercise of the Court’s discretion to extend the exclusive

periods, nor must they all be satisfied.

A debtor is not required to satisfy all nine factors as not all of them are relevant to

every case. Many courts have relied upon only a few of the above factors to determine

whether cause exists. See, e.g., In re Henry Mayo Newhall Mem’l Hosp., 282 B.R. 444, 453

(9th Cir. BAP 2002) (identifying "a transcendent consideration" to be "whether adjustment of

exclusivity will facilitate moving the case forward toward a fair and equitable resolution"); In

re Hoffinger Indus., 292 B.R. 639, 644 (8th Cir. 2003) (using four of the above factors to

affirm the bankruptcy court's extension of the exclusivity period); In re McLean Indus., Inc.,

87 B.R. 830, 834 (Bankr. S.D.N.Y. 1987) (identifying five factors used by courts to

determine whether cause exists to extend exclusivity).

/ / /

/ / /




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C. Cause Exists to Extend the Exclusive Periods.

Although the Bankruptcy Code does not define the term “cause” for purposes of §

1121(d) or establish formal criteria for an extension of the Exclusive Periods, bankruptcy

courts have discretion to extend exclusivity to promote the orderly, consensual, and

successful reorganization of a debtor’s affairs. See In re Timbers of Inwood Forest Assocs.,

Ltd., 808 F.2d 63, 372 (5th Cir. 1987) (noting that the meaning of “cause” under Section

1121 should be viewed in context of the Bankruptcy Code’s goal of fostering

reorganization); In re Mirant Corp., No. 4- 04-CV-476-A, 2004 WL 2250986, at *2 (N.D. Tex.

Sept. 30, 2004) (noting that an extension of exclusivity is typically granted where “the debtor

has shown substantial progress toward reorganization”). As shown below, the Debtor

meets each of these tests and the following factors support an extension.

1. The Debtor’s Chapter 11 Case is Large and Complex.

As part of its Petition and Schedules, the Debtor listed more than 600 creditors and

parties-in-interest with addresses around the world. Many of the creditors and parties-in-

interest are primarily Chinese speakers. (See Declaration of Warren Wang in Support of

Motion at ¶ 3.) As documented as part of this case, there are also many issues that arise in

simply maintaining the Debtors’ operations and Cash Management System, including the

continued use of Debtor’s existing banking relationships in China, the continued use of

certain individual cash app accounts and the ongoing maintenance of the employment

relationships with Chinese nationals. The Debtor’s current Cash Management System

includes two (2) pre-petition bank accounts in China necessary to pay key employees and

agents in China in RMB and to collect certain international investor relations revenue in

RMB, and new world technologies (i.e. certain cash apps platforms, namely WeChat Pay

and AliPay ) to collect of a small portion of Debtor’s subscription revenue. In addition, the

Debtor’s continued operation and revenue generation are dependent upon an active media

presence, namely YouTube, by the Debtor’s CEO, Warren Wang. Moreover, the Debtor

has been working diligently in good faith to resolve issues related to the continued use of

the China Accounts and the individual cash app accounts. (See Wang Dec. at ¶ 8.)




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2. The Debtor Has Made Good-Faith Progress Toward Reorganization, But

Needs More Time to Propose a Final Plan of Reorganization

In addition, the Debtor has been working in good faith with its management and

professionals and other parties-in-interest toward a plan of reorganization. Here, the Debtor

is making progress towards resolving the financial issues in its case. This progress is

reflected in the Debtor’s efforts to raise new capital from outside sources as well as the

Debtor’s review of its existing debt and equity structure and calculation of what a standalone

plan might look like. (See Wang Dec. at ¶¶ 9-13)

In this case the Debtor: (i) is cooperating with the Examiner’s review of the Debtor’s

pre and post-petition books and records; (ii) has timely filed its MORs with the Court; and

(iii) has complied with all of its duties under 11 U.S.C. §§ 521, 1106 and 1107, as well as all

applicable guidelines of the Office of the United States Trustee.

The Debtor Has Demonstrated Reasonable Prospects for Filing a Viable Plan

The Debtor has submitted that it clearly has a reasonable prospect for a viable plan.

Demand for the Debtor’s subscription offerings remain high and cash flow is growing back to

pre-petition numbers. The Debtor maintains a very high reputation with its subscriber base

and is always looking for avenues to efficiently increase is subscription base, including but

not limited to new and innovative subscription offerings. (See Declaration of Warren Wang

at ¶¶ 4-5.) The Debtor will soon share with the Committee an outline of the proposed Plan

in this case. (See Wang Dec. at ¶ 18.)

3. An Extension of the Exclusive Periods Will Not Prejudice Creditors

The Debtor is seeking to maintain exclusivity so parties with competing interests do

not derail the Debtor’s efforts to formulate a consensual restructuring that maximizes value

for all of the Debtor’s stakeholders. Given that this is the Debtor first request under 11

U.S.C. § 1121(b) the Debtor submits that there cannot be any prejudice to creditors. (See

Wang Dec. at ¶ 19.)




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4. No Prior Request

This case was filed on June 18, 2020. This is the first request made by the Debtor to

extend the exclusivity periods in this case.

VI.

CONCLUSION

Based on the forgoing, the Debtor seeks entry of an Order from this Court (a)

extending, by 120-days, (i) the period during which only the Debtor has the exclusive right

to file a Plan (hereinafter the “Exclusive Filing Period”) through and including February 13

2021, and (ii) the period during which the Debtor has the exclusive right to solicit a Plan

(hereinafter the “Exclusive Solicitation Period,” and, together with the Exclusive Filing

Period, the “Exclusive Periods”) through and including April 14, 2021; and (b) granting such

other and further relief as this Court deems just and proper under the circumstances.

DATED: September 28, 2020 Respectfully submitted,

JAMES ANDREW HINDS, JR. RACHEL M. SPOSATO THE HINDS LAW GROUP, APC By: James Andrew Hinds, Jr.

JAMES ANDREW HINDS, JR. General Bankruptcy Counsel for Chineseinvestors.com, Inc., Chapter 11 Debtor and Debtor-In-Possession




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DECLARATION OF WARREN WANG IN SUPPORT OF DEBTOR’S MOTION FOR

ENTRY OF AN ORDER (A) EXTENDING THE EXCLUSIVITY PERIODS AND (B)


I, Warren Wang, hereby declare and state as follows under penalty of perjury that the

following is true to the best of my knowledge, information and belief:

1. I am the CEO of the debtor and debtor-in-possession herein,

Chineseinvestors.com, Inc. (hereinafter referred to as the “Debtor”). In my capacity as

CEO, I am generally familiar with the Debtor’s day-to-day operations, business and financial

affairs, and books and records. I am over the age of eighteen (18) and I have been

authorized by the Debtor to submit this Declaration. Except as otherwise indicated, all facts

set forth in this Declaration are based upon my personal knowledge, my discussions with

other members of the Debtor’s management team, the Debtor’s employees or the Debtor’s

advisors, my review of the relevant documents and information concerning the Debtor’s

operations, financial affairs and restructuring initiatives, and my opinions based upon my

experience and knowledge. If called as a witness, I could and would competently testify to

the facts set forth in this Declaration.

2. I am generally familiar with the Debtor’s day-to-day operations, business

affairs, books and records, as well as the Debtor’s restructuring efforts. I submit this

Declaration to in support of the Debtor’s Motion to Extend the Exclusivity Periods in the

case.

The Debtor’s Chapter 11 Case is Large and Complex

3. As reflected in prior papers filed with the Court, as part of its Petition and

Schedules the Debtor listed more than 600 creditors and parties-in-interest with addresses

around the world. Many of the creditors and parties-in-interest are primarily Chinese

speakers. In order to communicate with its investors and subscriber base, the Debtor

obtained an Order from this Court allowing the Debtor to establish a new Chinese web

account operated through Omni Solutions on which all papers filed in the case are posted

along with critical dates and papers of general importance to the creditors and subscribers.




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4. The Debtor generates income from subscribers who are primarily Chinese

speakers located around the world, including the U.S., China and Canada, by providing

them daily subscription content in Mandarin on a number of financial topics via YouTube,

among other media distribution channels. Subscribers pay for access to the Debtor’s

financial education subscription offerings. At the present time the Debtor has approximately

one hundred thousand (100,000) free subscribers and eighteen hundred (1800) active paid

subscribers, and offers five (5) different subscription offerings.

The Debtor is Paying its Bills and Filing its MORs on Time.

5. The Debtor is paying its bills as they arise. The Debtor’s post-petition revenue

dipped just after the case was filed, down from the four months prior to the filing. Revenues

from subscriptions were at record highs pre-petition beginning in February 2020 and

continuing through June 2020 and the Debtor had instituted a number of operational cost

saving mechanisms. Although post-petition revenues dipped temporarily, the numbers for

September are within the average of the numbers in the months before the Petition was

filed. Moreover, me and my staff of editors and analysts in the United States and China are

actively working on new content, which I believe will assist in maintaining revenues at the

pre-petition levels.

6. At the same time, the Debtor has filed its MORs on time each month.

The Debtor’s Cash Management System Is Complex

7. The Debtor’s primary source of revenues currently are subscription revenues

from financial education services provided to the global Chinese community. In that regard

the Debtor’s business model is comprised of both United States and China Operations;

however, the Debtor’s China operations account for almost 90% of the Debtor’s total

subscription revenue and has for some time.

8. To facilitate the ongoing performance of its businesses and operations, in the

ordinary course, the Debtor maintains an integrated, centralized cash management system

(hereinafter referred to as the “Cash Management System”). This Cash Management

System is integral to the ongoing operation of the Debtor’s China offices and includes two




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(2) bank accounts in China, one for the Shanghai Rep Office (employs the sales people

responsible for almost 90% of the Debtor’s total subscription revenues), and one for the

Shanghai Newcoins Office (employs the majority of editors and analysts that support the

Debtor’s investment education subscription platform, as well international investor relations

sales people). In that regard, the Debtor maintains existing bank accounts in China at

Shanghai Pudong Development Bank (hereinafter the “Shanghai Newcoins Account) and

The Bank of China (hereinafter the “Bank of China Account”) (the Shanghai Newcoins

Account and the Bank of China are sometimes collectively referred to as the “China

Accounts”). The Debtor also utilizes certain New World Technology payment platforms,

namely WeChat Pay and AliPay, to collect revenues in RMB that cannot otherwise be

collected. Although these subscription revenues collected in RMB account for just a small

percentage of the total revenues generated by the Shanghai Rep Office and the U.S. Sales

Office, accordingly, they are nonetheless essential to the Debtor’s success going forward as

these amounts collected in RMB are used to offset the amounts requested from the Debtor

parent for the operating expenses for the China offices, including the payrolls which must be

paid in RMB. Moreover, collecting funds in RMB can be difficult, and almost impossible for

smaller companies operating in China, such as the Debtor.

9. The continued operation Debtor’s Shanghai Rep Office and the Shanghai

Newcoins Office (which requires the continued maintenance of the China Accounts) and the

continued use of the Debtor’s current Cash Management System allows the Debtor to

among other things, ensure cash availability for both its China and US operations, reduce

administrative costs, including payroll, by facilitating the employment of skilled, multilingual

Chinese Nationals who support the dominant part of the Debtor’s sales and operations

domestically and internationally. Any disruption of the Cash Management System would

have a devastating effect on the Debtor’s ongoing operations, as its operations require that

it be able to employ and pay these Chinese Nationals, and that it have prompt and ready

access to the cash provided through the Cash Management System. As noted above, not

only are these professionals responsible collecting almost 90% of the Debtor’s subscription




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revenues, the majority of which collected directly through the Debtor’s U.S. accounts, but

they also provide necessary support services. The Debtor’s senior management maintains

daily oversight over the Cash Management System and implements cash management

controls for entering, processing, and releasing funds in the Debtor’s businesses.

10. Also, the Debtor necessarily maintains two entities in China, the Shanghai Rep

Office and the Shanghai Newcoins Office. Namely because the Debtor’s Shanghai Rep

Office is structured as a Representative Office, it is subject to strict government regulations

in China, including but not limited to restrictions on the type of bank account it can have and

the number of staff it can employ. The Shanghai Rep Office’s Bank of China Account

cannot collect money in RMB and can only receive money from the U.S. parent company,

the Debtor, among other restrictions. Due to the restrictions on the Shanghai Rep Office,

Shanghai Newcoins was established in China in order to allow the Debtor be able to recruit

the experienced, multilingual, professional staff needed to support the Debtor’s operations.

Shanghai Newcoins currently employs professional financial editors experienced analysts

and designers that provide essential support to the Debtor’s core subscription business in

addition to some international investor relations sales staff. As almost 90% of the Debtor’s

subscription revenues are generated through the efforts of the sales and support teams in

China, both the Debtor’s Shanghai Rep Office and the Shanghai Newcoins Office and their

employees are essential to the Debtor’s continued operation.

11. Moreover from a cost perspective, the cost of labor in China is relatively low

compared to the United States for experienced professionals with similar skill sets. If the

Debtor were forced to close the Bank of China Account and/or the Shanghai Newcoins

Account, and stop using the cash app platforms, the Debtor would lose the ability to recruit,

retain and pay these valuable employees that are responsible for almost 90% of the

Debtor’s subscription revenues and whom the Debtor’s investor clients rely upon to provide

complex financial analysis and services.

12. Following recent cost cutting measures, the Debtor still has four (4) editors,

two (2) analysts and one (1) designer working in China in the Shanghai Newcoins Office in




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addition to the 19 individuals working in the Shanghai Rep Office which includes several

sales people in addition to one (1) analyst and two (2) editors, among others.

13. As such, the Debtor has been working diligently in good faith to resolve any

issues related to the use of the pre-petition Cash Management System with the US Trustee.

The Debtor Requires More Time to Finalize its Cash Management System.

14. The Debtor filed its Cash Management Motion with the Court seeking to

continue using the Debtor’s current Cash Management System. The U.S. Trustee filed an

Objection to the Debtor’s Cash Management Motion and the Court sustained the US

Trustee’ Objection subject to the Debtor reinstating the Cash Management Motion with a

clearer explanation of the need to retain the Chinese Accounts and the use of the individual

cash app accounts. Counsel for the Debtor has conferred several times with the U.S.

Trustee’s Office and the Committee related to the Debtor’s pre-petition Cash Management

System. Moreover, in the past few months, the Debtor has investigated a number to

alternatives to the existing Cash Management System and will be filing an Amended and

Supplement Cash Management Motion in short order That said, the Debtor has concluded

that its existing Cash Management System is the only way that the Debtor can have a

successful reorganization, namely due to the necessity of employing and paying the

Chinese nationals who are responsible for almost 90% of the Debtor’s total subscription

revenue, the majority of which is collected directly through the Debtor’s U.S. DIP Account.

The Debtor Requires More Time to Formulate its Plan and Work with the Committee

and Examiner in the Case.

15. As noted on the docket, the U.S. Trustee appointed a Committee in this case.

The Committee, in turn, retained professionals to represent their interests before the Court.

At my request counsel for the Debtor met with the Committee’s professionals to discuss

what the Committee believes to be the key issues in the case. The Committee made an

informal demand on the Debtor for the production of documents related to the Debtor’s use

of fund raised from third-parties over the past six years. Prior to producing the bulk of the

requested documents the parties negotiated the terms of a Protective Order designed




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protect from public disclosure certain proprietary and private data maintained in the Debtors

possession. After entry of the Order approving the Protective Order the debtor began

production of documents to the Committee.

16. At the request of the U.S. Trustee and with the consent of the Debtor, on

August 14, 2020, US Trustee, the Debtor, and the Committee executed a Stipulation for the

Appointment of an Examiner under §1104 of the Code. On August 19, 2020, the Court

entered an Order approving the parties’ Stipulation and Howard Grobstein was appointed

the Examiner in the case.

17. During the month of September the Committee, the Examiner and the Debtor

discussed the scope of the Examiner’s mandate, the Examiner’s initial request for

documents and data from the Debtor, and the need for a Protective Order to shield if

necessary private and confidential information to be shared with the Examiner in the case.

On or about September 17, 2020, the parties agreed that the existing Protective Order in

place between the Debtor and the Committee would be extended to and encompass the

Examiner. The Debtor is now producing documents as requested by the Examiner. By the

hearing date on this Motion the Debtor will have supplied the with all requested

documentation. As of the date of this Motion the Examiner has yet to render his final report

in the case.

18. It is my hope that prior to the hearing date on this Motion the Debtor will have

shared with the Committee and its professionals an outline of the Debtor’s proposed

standalone plan in this case. The Debtor and its management continued to examine all

avenues for proposing a consensual Plan in this case including, without limitation, new

equity or debt investments.

An Extension of the Exclusivity Periods in this Case Will not Prejudice the Interests

of Creditors and Other Parties-In-Interest.

19. The Debtor is seeking to maintain exclusivity so parties with competing

interests do not derail the Debtor’s efforts to formulate a consensual restructuring that

maximizes value for all of the Debtor’s stakeholders. Given that this is the Debtor first




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request under 11 U.S.C. § 1121(b) the Debtor submits that there cannot be any prejudice to

creditors.

Executed this 29th day of September 2020 at San Gabriel, California.

______________________________ Warren Wang


This form is mandatory. It has been approved for use by the United States Bankruptcy Court for the Central District of California.

June 2012 F 9013-3.1.PROOF.SERVICE

PROOF OF SERVICE OF DOCUMENT I am over the age of 18 and not a party to this bankruptcy case or adversary proceeding. My business address is:

21257 Hawthorne Blvd., Second Floor, Torrance, CA 90503

A true and correct copy of the foregoing document entitled DEBTOR’S MOTION FOR ENTRY OF AN ORDER (A) EXTENDING THE EXCLUSIVITY PERIODS AND (B) GRANTING RELATED RELIEF will be served or was served (a) on the judge in chambers in the form and manner required by LBR 5005-2(d); and (b) in the manner stated below: 1. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF): Pursuant to controlling General Orders and LBR, the foregoing document will be served by the court via NEF and hyperlink to the document. On (date) October 6, 2020, I checked the CM/ECF docket for this bankruptcy case or adversary proceeding and determined that the following persons are on the Electronic Mail Notice List to receive NEF transmission at the email addresses stated below: Service information continued on attached page 2. SERVED BY UNITED STATES MAIL: On (date) October 6, 2020, I served the following persons and/or entities at the last known addresses in this bankruptcy case or adversary proceeding by placing a true and correct copy thereof in a sealed envelope in the United States mail, first class, postage prepaid, and addressed as follows. Listing the judge here constitutes a declaration that mailing to the judge will be completed no later than 24 hours after the document is filed.

Service information continued on attached page 3. SERVED BY EMAIL (state method for each person or entity served): Pursuant to F.R.Civ.P. 5 and/or controlling LBR, on (date) ________________________, I served the following persons and/or entities by personal delivery, overnight mail service, or (for those who consented in writing to such service method), by facsimile transmission and/or email as follows. Listing the judge here constitutes a declaration that personal delivery on, or overnight mail to, the judge will be completed no later than 24 hours after the document is filed. Service information continued on attached page I declare under penalty of perjury under the laws of the United States that the foregoing is true and correct. October 6, 2020 Mayra Duran /s/ Mayra Duran Date Printed Name Signature




1. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF):

James Andrew Hinds [email protected], [email protected] Lior Katz [email protected] Crystle Jane Lindsey [email protected], [email protected];[email protected];[email protected] Joshua Mandell [email protected],

[email protected];[email protected];[email protected];[email protected]

James R Selth [email protected], [email protected];[email protected];[email protected];[email protected]

Rachel M Sposato [email protected], [email protected] Joseph Trenk [email protected] United States Trustee (LA) [email protected] Larry D Webb [email protected], [email protected] Daniel J Weintraub [email protected], [email protected];[email protected];[email protected] David Wood [email protected],

[email protected];[email protected];[email protected] Claire K Wu [email protected],

[email protected];[email protected];[email protected] Hatty K Yip [email protected], [email protected]

2. SERVED BY UNITED STATES MAIL:

***SEE ATTACHED LIST ***




PROOF OF SERVICE OF DOCUMENT I am over the age of 18 and not a party to this bankruptcy case or adversary proceeding. My business address is:

21257 Hawthorne Blvd., Second Floor, Torrance, CA 90503

A true and correct copy of the foregoing document entitled DEBTOR’S MOTION FOR ENTRY OF AN ORDER (A) EXTENDING THE EXCLUSIVITY PERIODS AND (B) GRANTING RELATED RELIEF will be served or was served (a) on the judge in chambers in the form and manner required by LBR 5005-2(d); and (b) in the manner stated below: 1. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF): Pursuant to controlling General Orders and LBR, the foregoing document will be served by the court via NEF and hyperlink to the document. On (date) October 6, 2020, I checked the CM/ECF docket for this bankruptcy case or adversary proceeding and determined that the following persons are on the Electronic Mail Notice List to receive NEF transmission at the email addresses stated below: Service information continued on attached page 2. SERVED BY UNITED STATES MAIL: On (date) October 6, 2020, I served the following persons and/or entities at the last known addresses in this bankruptcy case or adversary proceeding by placing a true and correct copy thereof in a sealed envelope in the United States mail, first class, postage prepaid, and addressed as follows. Listing the judge here constitutes a declaration that mailing to the judge will be completed no later than 24 hours after the document is filed.

Service information continued on attached page 3. SERVED BY EMAIL (state method for each person or entity served): Pursuant to F.R.Civ.P. 5 and/or controlling LBR, on (date) ________________________, I served the following persons and/or entities by personal delivery, overnight mail service, or (for those who consented in writing to such service method), by facsimile transmission and/or email as follows. Listing the judge here constitutes a declaration that personal delivery on, or overnight mail to, the judge will be completed no later than 24 hours after the document is filed. Service information continued on attached page I declare under penalty of perjury under the laws of the United States that the foregoing is true and correct. October 6, 2020 Mayra Duran /s/ Mayra Duran Date Printed Name Signature




1. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF):

James Andrew Hinds [email protected], [email protected] Lior Katz [email protected] Crystle Jane Lindsey [email protected], [email protected];[email protected];[email protected] Joshua Mandell [email protected],

[email protected];[email protected];[email protected];[email protected]

James R Selth [email protected], [email protected];[email protected];[email protected];[email protected]

Rachel M Sposato [email protected], [email protected] Joseph Trenk [email protected] United States Trustee (LA) [email protected] Larry D Webb [email protected], [email protected] Daniel J Weintraub [email protected], [email protected];[email protected];[email protected] David Wood [email protected],

[email protected];[email protected];[email protected] Claire K Wu [email protected],

[email protected];[email protected];[email protected] Hatty K Yip [email protected], [email protected]

2. SERVED BY UNITED STATES MAIL:

***SEE ATTACHED LIST ***


Chineseinvestors.com, Inc. 227 W. Valley Blvd., Suite 208A San Gabriel, CA 91776

20 Largest Unsecured Creditors: Bo Guan 3264 Ravenswood Way San Jose, CA 95148

Changchuan Zhu ** 2-803 Greencity Gordon Piaoyi Road Suzhou City Jiangsu Provice China, MD 21500

Hui Zhang ** 2-901 Greencity Gardon, Piaoy Road Suzhou, Jiangsu Province, China MD 21500

Ching Wen Cheng ** 8F, No. 8, Lane 37 Boachan Rod Yonghe District New Taipei City 23 Taiwan ROC China 22052

Jiaying Zhang ** RM 211 Haitian Gordon No 1481 Huqingping Highway Shenghai China 201500

Jingyun Gu 2750 Holly Hall Street, # 1109 Houston, TX 77054

Lanqian Ju 5657 Lysander way San Ramon CA 94582

Mary Man Ruo Shen 5670 Geranium Ct. Newark, CA 94560

Mary Y. Louie 5306 Muzzay Ct. Livingston, NJ 07039

Power Up Lending 111 Great Neck Road, Suite 214 Great Neck, NY 11021

Qi Zhang c/o Akerman LLP 601 West 5th Street, Suite 300 Los Angeles, CA 90071

Siwei Yang 37796 Hyacinth Street Newark, CA 94560

Ye Wang 44248 Ibero Way Fremont, CA 94539

Weizhi Ding 14867 Granite Way Saratoga, CA 95070

Yang Fang AN c/o Akerman LLP 601 West 5th Street, Suite 300 Los Angeles, CA 90071

Yuh Shiang LLC 5306 Murray Ct. Livingston, NJ 07039

Ying Pin Lin ** 38 Hong In Nong Changt Tie Tou Gia Shan Zheng Cang Shan Qu Fuzhou City, FU Jian China 350300

Bluevine 401 Warren Street, #300 Redwood City, CA 94063

Internal Revenue Service P.O. Box 7346 Philadelphia, PA 19101

Securities & Exchange Commission 444 South Flower Street, Suite 900 Los Angeles, CA 90071

Secured Creditors: Lancer Investments, LLC 227 W. Valley Blvd., #308 San Gabriel, CA 91776

Work Better 40 Wall Street, 28th Floor New York, NY 10005

K&G 37 Ave., Realty LLC 134-35 33rd Ave., Third Floor Flushing, NY 11354

Creditors Committee:

Ye Wang and Simon Kiang 44248 Ibero Way Fremont, CA 94539

Mary Y. Louie 5306 Murray Court Livingston, NJ 07039

Qi “Angel” Zhang 160 Harbor Acres Road Sands Point, NY 11050


Other Professionals:

Samuel R. Biggs, CPA SLBIGGS, a Division of SingerLewak 10960 Wilshire Boulevard, 7th Floor Los Angeles, CA 90024

Michael E. Shaff Irvine Venture Law Firm LLP 19900 MacArthur Blvd., Suite 530 Irvine, CA 92612

Adam Meislik Force 10 Partners, LLC 20341 SW Birch Suite 220 Newport Beach, CA 92660

Joshua Mandell, Esq. Akerman LLP 601 W. 5th Street, Suite 300 Los Angeles, CA 90071

James R. Selth Weintraub & Selth, APC 11766 Wilshire Boulevard, Suite 1170 Los Angeles, California 90025

Howard B. Grobstein, CPA Grobstein Teeple LLP 6300 Canoga Ave., Suite 1500W Woodland Hills, CA 91367

Joshua R. Teeple, CPA Grobstein Teeple LLP 23832 Rockfield Boulevard, Suite 245 Lake Forest, California 92630


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