Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 1 of 43 Page ID #:16496 1 Michael Gerard Fletcher (State Bar No. 070849) mfletcher@frandzel.com Craig A. Welin (State Bar No. 138418) 2 cwelin@frandzel.com 3 Hal D. Goldflam (State Bar No. 179689) hgoldflam@frandzel.com FRANDZEL ROBINS BLOOM & CSATO, L.C. 4 1000 Wilshire Boulevard, Nineteenth Floor 5 Los Angeles, California 90017-2427 Telephone: (323) 852-1000 Facsimile: (323) 651-2577 6 7 Attorneys for Receiver ROBB EVANS & ASSOCIATES LLC 8 9 UNITED STATES DISTRICT COURT 10 CENTRAL DISTRICT OF CALIFORNIA 11 WESTERN DIVISION 12 13 14 15 16 17 18 FEDERAL TRADE COMMISSION, Case No. 5:18-cv-02104-DMG-PLA Plaintiff, REPORT OF THE TEMPORARY RECEIVER ROBB EVANS & ASSOCIATES LLC OVER AND REGARDING VPL MEDICAL, INC. v. JASON CARDIFF, etc., et al., Date: Time: Place: Judge: Defendants. 19 20 21 22 23 24 25 26 27 28 No Hearing Required No Hearing Required Courtroom 8C, West 1st Street Hon. Dolly M. Gee TO THE HONORABLE DOLLY M. GEE, JUDGE OF THE UNITED STATES DISTRICT COURT. Receiver Robb Evans & Associates LLC (“Receiver”) has been appointed by this Court to be the temporary receiver over and concerning, among other things and persons, VPL Medical, Inc. ("VPL") by this Court's Temporary Restraining Order With Asset Freeze And Other Equitable Relief And Order To Show Cause Why A Preliminary Injunction Should Not Issue Under Seal And In Camera, entered by the 3818533.1 078410-0061 1 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 1 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 2 of 43 Page ID #:16497 1 Court on June 24, 2020 (Dkt. no. pending). The Receiver hereby submits to this 2 Court the initial Report Of Receiver’s Immediate Access To The Premisies Of VPL Medical, Inc., 3 concerning VPL ("VPL Initial Receiver's Report"). The VPL Initial Receiver's 4 Report is attached hereto as Exhibit A, together with its accompanying report 5 exhibits. 6 7 DATED: June 29, 2020 8 FRANDZEL ROBINS BLOOM & CSATO, L.C. MICHAEL GERARD FLETCHER CRAIG A. WELIN HAL D. GOLDFLAM 9 10 1000 WILSHIRE BOULEVARD, NINETEENTH FLOOR LOS ANGELES, CALIFORNIA 90017-2427 (323) 852-1000 FRANDZEL ROBINS BLOOM & CSATO, L.C. Respectfully submitted, 11 12 13 By: /s/ Michael Gerard Fletcher MICHAEL GERARD FLETCHER Attorneys for Receiver ROBB EVANS AND ASSOCIATES LLC 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3818533.1 078410-0061 2 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 2 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 3 of 43 Page ID #:16498 1 EXHIBIT A 2 [VPL Initial Receiver's Report Attached] 3 4 5 6 7 8 10 1000 WILSHIRE BOULEVARD, NINETEENTH FLOOR LOS ANGELES, CALIFORNIA 90017-2427 (323) 852-1000 FRANDZEL ROBINS BLOOM & CSATO, L.C. 9 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3818533.1 078410-0061 3 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 3 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 4 of 43 Page ID #:16499 Robb Evans & Associates LLC Receiver of Redwood Scientific Technologies, Inc. et al. and Temporary Receiver of VPL Medical, Inc. REPORT OF RECEIVER’S IMMEDIATE ACCESS TO THE PREMISIES OF VPL MEDICAL, INC. Dated June 29, 2020 Overview This report will describe the steps taken by the Receiver to implement the terms of the Temporary Restraining Order (TRO) issued on June 24, 2020. Business Locations On June 25, 2020, the Receiver entered the premises of VPL Medical Inc. (VPL) located at 9007 Arrow Route, Suite 290 in Rancho Cucamonga, CA. Mr. Bobby Bedi (Bedi) was at the business premises. Mr. Jason Cardiff (Cardiff) was not at the business premises. The premises consist of a common area with several desks and two offices. Bedi occupies one office and Cardiff occupies the other office. The premises located at 9087 Arrow Route, Suite 150 in Rancho Cucamonga are not completed. Suite 150 contains 1 machine that is for the assembly of surgical face masks. Bedi told the Receiver that this machine will be used for training staff to operate similar machines that are being delivered from China. Bedi told the Receiver about a third 9,953 SF location at 12182 Santa Margareta Court, Rancho Cucamonga. VPI executed a five-year triple net lease and paid a six-month security deposit of $55,064.76 and two months’ rent totaling $13,430.24 for this location. Bedi told the Receiver this location is currently being prepared for the installation of six surgical mask assembly machines. The preparation of this facility includes construction underway of a “clean room.” Access to Documents Bedi provided the Receiver access to all documents requested by the Receiver as defined in the TRO. Those documents included: • • • • All paper documents in the office All VPL email accounts Access to the JPMorgan Chase bank account Access to the accounting records Page 1 of 5 4 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 5 of 43 Page ID #:16500 Corporate Structure of VPL Bedi told the Receiver that VPL is his company, he holds 100% ownership, and that he brought Cardiff into the company to handle logistics. Bedi stated Cardiff has no corporate shares or any ownership in VPL. The official corporate records verified by the Receiver validate Bedi’s assertion. However, upon review and analysis of documents obtained by the Receiver, Cardiff appears to be more than a logistics coordinator. These other documents, perhaps produced before the official corporate records were completed, and the exactly equal distributions of projected net profits and weekly $5,000 advances, support a co-equal ownership and management arrangement documented by agreement between Bedi and Cardiff, but not recorded in writing. Under Exhibit 1 is an April 5, 2020 email from Cardiff to Jim White. The email states in part “I don’t want what happened to me with pharma strip to happen again with VPL. I am not going to lose another company.” The email goes on to state “I would like to make sure the he [sic] Super majority shares in the company belong to my company I would also like a trigger provision that I can call all bobby’s stock at any time at 00.01 cost basis.” The body of the email under Exhibit 1 lists Cardiff as Chairman and President and Bedi as CEO. The email closes by stating in part “As I ahve [sic] raised all the capital and done all the work once again I am not going to lose out on perhaps by biggest company todate [sic].” Bedi told the Receiver that he and Cardiff split the net profit 50/50 of a recently completed contract with the US Veterans Administration. He estimated that split was approximately $350,000 for each of them. Bedi also told the Receiver that a pending $14 million contract with the US Department of Health and Human Services (HHS) to produce and deliver 20 million surgical masks should produce net profit of $1.8 to $2.4 million, most likely to be $2.0 million, and that net profit would also be split 50/50 between Cardiff and him. Bedi stated that profit sharing for future contracts has not yet been determined. Bedi further told the Receiver that there were no documents memorializing the profit-sharing arrangement between Cardiff and him. Bedi also told the Receiver that Cardiff did not want to be a signatory on the VPL bank account. Under Exhibit 2 is a picture taken by the Receiver in Cardiff’s office of an organization chart. Bedi and Cardiff are at the top of the chart. Under Exhibit 3 is a lease application form completed by Cardiff. On page one of the form, Bedi is listed as Cardiff’s business partner. On page two of the form, Cardiff lists his title at VPL as President. Under Exhibit 4 is an April 21, 2020 email and attachment from Jim White to Bedi and Cardiff regarding an organizational meeting of VPL. The draft minutes of the first board meeting of the board of directors appoint Bedi and Cardiff as the sole directors of the corporation. The draft minutes also list Bedi and Cardiff as equal shareholders of the corporation. Page 2 of 5 5 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 6 of 43 Page ID #:16501 While the draft minutes are not signed, Bedi’s statement to the Receiver that there were no documents memorializing the arrangement between Cardiff and him strains credibility. Under Exhibit 5 is a June 8, 2020 email and attachment from Cardiff to Bedi and Edward Jimenez. Bedi told the Receiver that Mr. Jimenez is his bookkeeper. The email is authorizing payment for a face mask machine and associated product. The attached invoice is signed by Cardiff. Under Exhibit 6 is an April 17, 2020 email from Stacey Barker 1 to an employee of the Veterans Administration. The email states in part “I have CC’d the President (Bobbi) and CEO (Jason) so you can familiarize your self with them as well.” Financial Information Under Exhibit 7 is a compilation of VPL’s Chase bank account prepared by the Receiver. Total receipts from the Veterans Administration contract were approximately $5.4 million. From March 30, 2020 to June 26, 2020 Cardiff and Bedi were each paid $420,000 from this account. At June 26, 2020 $2,660,975 remained in the account and was frozen by the TRO. The Receiver believes an additional $100,000 is frozen in a VPL account at Citizens Business Bank2. Under Exhibit 8 is a Memorandum of Agreement between VPL and Wave Crest Management to finance the transaction with the Veterans Administration. Under the terms of the agreement, Wave Crest Management advanced $2.920 million and was to have the advances repaid plus $500,000 in fees. Part of the first advance has been paid back. The agreement states that parties shall cooperate in filing an appropriate UCC-1 Financing Statement in all appropriate jurisdictions. The Receiver has not located a UCC-1 recording in California but has not yet checked other jurisdictions. The outstanding balance under the agreement is approximately $2.6 million. In addition to the outstanding balance due Wave Crest Management, Bedi provided other accounts payable to the Receiver. The other accounts payable, $404,190, are for equipment and transportation charges for surgical mask manufacturing equipment and leasehold improvements in the proposed manufacturing location on Santa Margareta Court. This total does not include transportation and other charges for two additional manufacturing machines scheduled to arrive next week. 1 2 As shown on Exhibit 7, VPL paid Stacey Barker over $257,000. Citizens Business Bank has not yet confirmed this balance. Page 3 of 5 6 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 7 of 43 Page ID #:16502 The table below illustrates the current financial condition of VPL. Absent additional funding, VPL does not have sufficient cash to meet its current obligations or complete its contract with HHS. Preliminary funds - Chase $2,660,975.51 Preliminary funds - Citizen Business Bank 100,000.00 Total Funds Available $2,760,975.51 Taizhou Beiping Machine Tool Co. LTD Powerzone Construction Wave Crest Management Snyder & Snyder Construction Everwan International Corp. Everwan International Corp. EDM International Logistics Inc $6,664.00 11,485.00 2,620,000.00 48,600.00 21,548.00 21,140.00 294,753.00 Total Funds required $3,024,190.00 Shortfall ($263,214.49) Bedi advised the Receiver that interested investors are ready to inject the necessary capital to continue operations and complete the HHS contract. The HHS contract requires all of the surgical masks to be made in the USA. Bedi told the Receiver that all of the material required to assemble the surgical masks for HHS is to be imported from China. The Receiver has not researched if assembled in the USA legally qualifies under HHS guidelines as made in the USA. Additionally, Bedi has not discussed or produced any projections of the labor and material cost to produce the surgical masks under the specifications required by the HHS. He has not discussed or produced a complete cash flow projection, including all cash payments for manufacturing labor and material, for purchasing equipment, for completing leasehold improvements, and for rent and other occupancy expenses. Page 4 of 5 7 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 8 of 43 Page ID #:16503 Conclusion VPL is currently operating under the supervision of the Receiver. The Receiver is aware of its obligations under section VI D (p 13) of the TRO to “Conserve, hold, manage, and prevent the loss of all VPL Assets, and perform all acts necessary or advisable to preserve the value of those Assets.” The Receiver intends to follow-up and evaluate several issues detailed in this report which include: • • • • • Determining the priority of the payment due to Wave Crest Management. Determining if UCC-1 Financing Statements have been recorded in other jurisdictions. Vetting any proposed investors/lenders to fulfill the HHS contract. Researching HHS guidelines to clarify what is considered as Made in the USA. Determining and analyzing the potential positive net cash flow from the completed HHS surgical mask contract. Respectfully submitted, /s/ Robb Evans & Associates LLC Receiver Page 5 of 5 8 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 9 of 43 Page ID #:16504 EXHIBIT 1 9 pnvate private Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 10 of 43 Page ID #:16505 Subject: private From: Jason Cardiff Date: 4/5/2020, 12:21 PM To: Jim White Jim II don't don’t want what happened to me with pharma strip to happen again with VPL II am not going to lose another company that being said II would like to make sure that he Super majority shares in the company belong to my company II would also like aa trigger provision that II can call all bobby's stock at any time at 00.01 cost basis II would also like super majority voting power at a a 2 to 1 vote For the Board Jason Cardiff ( Chairman and President President)) Bobby Bedi CEO James D D white Brian Travis Keneddy (( ADvisor to the White house )) Dr Reddy ( medical doctor doctor)) Jim As II ahve raised all the capital and done all the work once again II am not going to lose out on perhaps my biggest company todate. Further II have a a meeting with a group that wants to put in 10 mil this week. Jason Cardiff Here to Help, Viral Protection Labs Rancho Cucamonga Ca Cell Offi www.vplmedical.com_____ r.vplmedical.co~ - - 10 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 11 of 43 Page ID #:16506 EXHIBIT 2 11 Case Document 365 Filed 06/29/20 Page 12 of 43 Page ID #:16507 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 13 of 43 Page ID #:16508 EXHIBIT 3 13 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 14 of 43 Page ID #:16509 Office of Realty Holdings, Ltd. FINE RENTALS, SALES & INVESTMENTS, Since 1989 Residential-Commercial Application to Lease Dear Client, Thank-you for your interest. This is your preliminary Application to Lease. This document shall be a professional space. The used solely for the basis for approving your application to lease an apartment or a information that you provide shall be deemed confidential and privileged, to be shared only with the prospective Lessor and the Broker of Record in the transaction. Kindly fill out all field areas as indicated to the best of your knowledge. When completed and signed, it shall it be delivered to the office of the Landlord landlord for final approval. Feel free to call us with any questions or clarification. Thank you. Chris Marr Today's Date: J{ /n I/ •'ZO 2.0 2-° i) Property Address:. Address: . Ask Rent$ Rent$__ _ _ _ __ Unit# , Desired Occupancy Date: Offer (If (if any) Offer any)._ _ _ _ _ Desired Occupancy Date: Children/Ages:_Ch^r -i;,rI/20,20 ^ 2o2ti Pets/Breed/Size: / __________________________________________ /j Z_____ Proposed Length of of Lease .Start Date________________________________________ Date _ _ _ _ _ _ _ _ _ _ _ __ Proposed Length Lease._ _ _ _ _ _ _ _Start Primary Applicant Name or Company Name: Name:. ,J pL. QL-Q\.e,c\; to..\ "I.N 4 ~ Security# Applica Social Security it or Tax ID# ID # of Primary Applican Co-Applicant's Full Name: Relationship to Applicant: Relationship to Applicant: ho~ BY ~~ ~ \ ____________________ bu:> lA.OIV1 ~"~ _________ .Co-Applicant's SS#: 1 Co-Applicant's SS#: Present Address Address: Amt._ _ __ Current Rent or Mo Mortgage Amt Home Phone Phone Home Mobile Phone Phone Mobile f. c_. c. C4 CA' RESIDENCE HISTORY: RESIDENCE HISTORY: 1 !2..~ Mortgage/Rent:$ Total Current Monthly Obligations: Mortgaee/Rent:S Name of Management Co/Landlord: !ir Ct>roperty Taxes:$. Taxes:$ S ~(""°Condo Fees:$ _ _ __ Condo Fees:$___________ Phone#: _________ :2'M "7>V\ .. C.~(>:'-1 "s S_________________Phone #:___________________ ______________ ------------- Address of Current Management Co/Landiord: Address of Current Management Co/Landlord: Years Present Address:--=-,1 Address: Years at at Present _l..,.., :;...__ Reason Reason for for Moving:. Moving: er\: oA.- ~~ McfV t,) :!!::11,,11~~\.!.:CM.=.=..=l!:......::e.=:.. ujfksaJL Previous Address: Address:_, Emergency Contact: v0 : {s~ ,A J, C~# Relationship:~ Relationship: th<2C - c;,...,,p ~,t-~11,~ /-,t(-vears Address:...l3,_ Years at Previous Address: 13, Phone __Phone #: 1 14 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 15 of 43 Page ID #:16510 Have you ever had litigation with any Landlord and/or Management Company in a residence or office you have -__..N~~=~~--..:.-·___________________________________ ------------ occupied?:________________ IfIfyes, yes, please pleaseexplain: explain:._b,'.)_p __ occupied?: EMPLOYMENT HISTORY: Primary Applicant (PLEASE FURNISH VERIFICATION LETTER OR CONTRACT FROM EMPLOYER) Current Employer: ^ J Pl . iw*»________Address: M:«-c, Cc. .J,. Address: > ~da.,,,..,\:u____________________________ ___________ Phon Phone: urrent Title/Position Held: Held:---:iea..;r.:;..;:Y,rc.=-:ic:. rrent Annual Salary:$~ Salarv:$ ^ 5, ~ Annual Bonus/Other Additional Bonus/Other Additional Income: Income: $'po, cnto 010 —Years at present -Years at present job:____/_ job: _ _ / __ IF LESS THAN 3 YEARS: Previous Employer/Address:. Employer/Address: a...,.;..~••~ S~ S**^*k C*_ ( C..c..... Account Manager: _ _ __________________ _ _ _ _ _ _Phone:_____________________Email:. Phone:. _ _ _ _ _ _ _Email: _ _ _ _ _ _ _ _ _ __ Account Manager:_______ REFERENCES REQUIRED FOR APPLICANT AND CO-APPLICANT, CO-APPLICANT. IF MARRIED: (2.o\.u-"t 2~p·, n \ Reference #2 lAnte Reference #2 Name/Address/Phone:. Name/Addr s/Phone: AV^/ t, ;;&r;h; PWv\V\ ~~\ ' Reference #1 Name/Address/Phone Reference #1 Name/Address/Phone: (1) r^ \ ~..._ ~lc,,n . q 1)11 '11 ^ ~ iA^ r ~ -,..A Name/Address/Phonerof applicable):_________________________ C....\e,A \>cx.Cio»C. 2agi y Name/Address/Phone'of Attorney (if applicable): (su-.('9'.)\e.. ..,, ^W V«G""t~ ~"'-·-~~ ~- Prt&c*^s' ~~· Name/Address/Phone of Accountant (if applicable): _....................................................... __________ _ _ _ _ _ _ _ __ Name/Address/Phone ......................................................... C-oC^J^ bfcvry' ~c~~ 2 15 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 16 of 43 Page ID #:16511 CREDIT CHECK AUTHORIZATION/ BROKER FEE AGREEMENT: Please read thoroughly before signing: The Landlord will in no event be bound, nor will possession be given until a lease is fully executed AND signed by the Landlord, and thus returned to Tenant/Applicant. The Tenant/Applicant and all references must be satisfactory to the Landlord, Landlord. Christopher Duncan Marr/The Office of Realty Holdings, Ltd. Broker shall in no event be liable in respect to any matter concerning this application, now or ever, concerning any act of the Landlord or Management Company, or failure to act on the part of the Landlord in connection with this application, or in connection with any lease or contemplated lease herein. No representations or agreements by Agents, Brokers or Others are binding on the Landlord Landford or Agent, unless included and made part of the written lease proposed to be executed. Parties signing this agreement shall hold the above party harmless now and forever. I, Client/Tenant/Applicant herein represent that all of the above statements and inclusions set forth by my hand have been true and accurate to the best of my knowledge. II further represent that I am not leasing another space under any other name, nor am I now, or have I ever been dispossessed from a residence or commercial property. II am of legal age to sign below and/or on behalf of others. I am a valid U.S. Citizen and/or have sufficient Green Card/Visa Card/Vtsa status to live and/or work in the U.S., of which II have furnished to the Broker sufficient proof upon request. Further, if in the event of a commercial or professional lease (if applicable), II am authorized by the corporate charter to sign on behalf of my company. Finally, II understand and agree that Christopher D. Marr of Office of Realty Holdings has been the procuring and sole Broker of Record in this transaction, unless stated otherwise, and that no other Broker was involved with showing me or directing me to the space. No claims may be made to Broker by any outside Broker and/or Agency, Agency. iI understand (or that the compensation to the Broker for securing the space for me shall come in the manner of a broker fee {or commission). The broker commission structure is as follows: A one-time fee of 15% of the-first-years-rent on a one or two year lease. 17% of the first years rent on a multiple-year lease. Meaning 3 years y~ars or more. One-month's-rent on aa lease less than a one year lease. II fully understand that this fee is due at the signing of the lease, and is to be paid in the form of bank check or wire transfer, with wire instructions to be provided by Broker prior to signing of the lease. With application, Tenant/Appiicant Tenant/Applicant shall be required to put down a refundable good-faith deposit equal to the sum of 10% of the monthly rent or 3 . together with a non-refundable credit check fee in the amount of $ $125.00 for residential applicants and $205 for commercial & professional applicants, per applicant. Said deposit shall ensure that the space be taken off the market, shown to no other prospective parties during a a reasonable period of time whilst undergoing negotiations. Any and all funds held by the Broker shall be held in a separate account in the name of the client / / applicant for a period not to exceed exce.ed 30 days. Any and all funds held shall be applied towards either rent and security deposit, or the commission. This information shall further be reflected on the final invoice. Any deposit refunds can take up to 21 days for processing paid by company check or transfer. Broker shall not be held liable in the event of delay due to unforeseen holiday or strike or situation beyond reasonable control. SIGNED AND AGREED TO, Co-Applicant Signature/Date BY: Christopher Marr, President Office of Realty Holdings. Ltd. 909 Third Avenue, #6293 New York, NY 10150 Tel: 917.597.0994 EFax: 917.546.2394 realtvholdtngs@aolxQm realtyholdings@aol.com 3 16 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 17 of 43 Page ID #:16512 EXHIBIT 4 17 urart or urgamzanona1 urganizationai Mmutes Minutes tor a1scuss10n discussion... urarr ... Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 18 of 43 Page ID #:16513 discussion... Subject: Draft of Organizational Minutes for discussion ... From: Jim White Date: 4/21/2020, 6:29 PM "bb(S)vplmedical.com" , Jason Cardiff To: "bb@vplmedical.com" Incorporator which Edward needs to sign and return to me. ... attached. Also attached is Minutes of Sole lncorporator Chat tomorrow about the First Minutes. JDW - Attachments: - - - - - - - - -------------------------------------------------------------------------------------------'-----------------Attachments:------------------------------- DRAFT FIRST MINUTES FOR DISCUSSION.pdf 66.5 KB MINUTES OF ACTION OF SOLE INCORPORATOR of VPL MEDICAL.pdf 33.7 KB 18 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 19 of 43 Page ID #:16514 MINUTES OF ACTION OF SOLE INCORPORATOR of VPL MEDICAL, INC. a California corporation TAKEN WITHOUT A MEETING BY WRITTEN CONSENT The following actions are hereby taken by the incorporator of VPL MEDICAL, INC. a California corporation, by written consent, without a meeting. The following resolutions for the governance of this corporation are hereby adopted: RESOLVED, that the NUMBER OF DIRECTORS OF THE CORPORATION SHALL BE SET AT TWO, subject to change as may allowed by law. RESOLVED The following resolution appointing the directors of the corporation is adopted: the following persons are hereby appointed as directors of this corporation for the ensuing year and until their successors have been elected and qualified: BobbyBedi Bobby Bedi Jason Cardiff The undersigned, the sole incorporator of this corporation, consents to the foregoing action. DATED: - - -___________ ----EDWARD JIMENEZ 19 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 20 of 43 Page ID #:16515 MINUTES OF FIRST MEETING OF BOARD OF DIRECTORS OF INC VPL MEDICAL, INC. The directors of the above corporation held their first meeting on 2020 commencing at 10:00 a.m. PST by telephonic conference call. , The following Directors, constituting the entire Board of Directors previously named by the Incorporator, were present: BobbyBedi Bobby Bedi Jason Cardiff James D. White, Esquire was also present. Upon motion duly made, seconded and unanimously carried, Bobby Bedi was elected Chairperson of the meeting and Jason Cardiff was elected Secretary of the meeting. The Chairperson stated that the Articles of Incorporation of the Corporation were filed fil ed in the office of the California Secretary of State on 2020. The Chairperson presented to the meeting a certified certilied copy of the Articles of Incorporation and the Secretary was directed to insert the copy in the Minute Book of the Corporation. The meeting proceeded to the completion of the organization of the corporation, and, upon motion duly made, seconded, and unanimously carried, the following resolutions were adopted: RESOLVED: That Edward Jimenez, named as this corporation's corporation’s initial agent for service of process in the Articles of Incorporation, I ncorporation, is hereby confirmed in such capacity. RESOLVED FURTHER: That the Bylaws presented to this meeting be, and the same hereby are, adopted as and for the bylaws of this corporation, and the Secretary is directed to certify the adoption of said Bylaws Byla ws and to maintain a copy of the Bylaws, so certified, at the 20 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 21 of 43 Page ID #:16516 corporation's principal executive or business office in California in accordance with Section 213 of the California General Corporation Law. RESOLVED FURTHER: That the corporate seal in the form, words, and figures presented to this meeting and impressed upon the last page of these minutes, be, and it hereby is, adopted as the seal of this corporation. RESOLVED FURTHER: That the form of stock certificate(s) presented to this meeting be, and it hereby is, approved and adopted, and the Secretary is directed to insert a specimen certificate in the Minute Book immediately following these minutes. RESOLVED FURTHER: That 9007 Arrow Rte. Suite 290, Rancho Cucamonga, California shall be, and the same hereby is, designated and fixed as the principal executive office for the transaction of the business of this corporation. ELECTION OF OFFICERS The Chairperson stated the next item of business would be to elect officers of the corporation for the coming year. After discussion, and upon nominations duly made and seconded, the following persons were unanimously elected to the offices and at the annual salaries respectively set forth: Salary Name Position BobbyBedi Bobby Bedi President/CEO Vacant Vice President To Be Determined Later Jason Cardiff Secretary 535,000./ Mo~To Mq-.To Be $35,00~/ Accrued nendmg A:ccrue nern ng 535,000./ Mo~To Ma.To Be $35,00~/ Accrued nern nending A:ccrue ng avallab e. .tun s 0 availableTunus avallab e. .tun s availableTunds Edward Jimenez Treasurer/ CFO To Be Determined Later The directors thereupon unanimously adopted the following resolution: 21 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 22 of 43 Page ID #:16517 RESOLVED: That the corporate officers are hereby directed to prepare and file with the California Secretary of State the Information Statement as required by Section 1502 of the California General Corporation Law. INSURANCE The directors thereupon unanimously adopted the following resolution: RESOLVED: That the corporate officers are authorized and directed to obtain forthwith and maintain D&O insurance coverage and such other insurance coverages as they deem prudent. FISCAL YEAR The Chairperson stated it would be advisable for the corporation to establish a fiscal year. Upon motion duly made, seconded, and unanimously carried, the following resolution was adopted: RESOLVED: That the fiscal year of this corporation shall end on December 31 of each year. ESTABLISH BANK ACCOUNTS The Chairperson next proposed the Board make provision for the establishing of banking relations including the deposit of the funds of the corporation and their withdrawal. Upon motion duly made and seconded, the following resolutions were unanimously adopted: RESOLVED: The Officers and Directors are authorized and directed to establish banking relations, including such accounts as they deem advisable, with Chase Bank. PAYMENT OF INCORPORATION EXPENSES In order to provide for the payment of the expenses of the incorporation and organization of the corporation, coiporation, upon motion duly made, and seconded, the following resolution was unanimously adopted: 22 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 23 of 43 Page ID #:16518 RESOLVED: That the officers of the corporation are authorized and directed to pay the expenses of its incorporation and organization, including effecting reimbursement to any persons who have advanced funds to the corporation for such purposes and payment of any amounts owing to the corporation's corporation’s attorney and accountants for services in connection therewith. RATIFICATION OF CONTRACTS The board next considered the ratification of commitments made on behalf of the corporation prior to the completion of its organization. Bobby Bedi and Jason Cardiff explained the status of their respective efforts to organize the corporation and efforts to acquire certain purchase orders and financing arrangements for such orders. Upon motion duly made and seconded, the following resolutions were unanimously adopted: RESOLVED: That the contracts and transactions entered into on behalf and for the benefit of this corporation, listed below, be and they hereby are accepted, adopted and ratified by this corporation: Informal Consulting Agreement with Jason Cardiff for which no compensation arrangement has as yet been made; Agreement/ order for sale of product to The Department of Veterans Affairs; and Memorandum of Agreement with Wave Crest Management to finance an order for product from The Department of Veterans Affairs and Agreements with the vendor of the masks and all related agreements with shipping and customs brokers and insurance agents. 23 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 24 of 43 Page ID #:16519 RESOLVED FURTHER to provide as security for the repayment of the funds to be advanced by Wave Crest Management, pursuant to the foregoing Memorandum of Agreement, the Secretary is authorized and directed to proved to Wave Crest Management a UCC-1 Security Interest in the goods ordered from the manufacturer and proceeds thereof as described in and pursuant to the terms of the said Memorandum of Agreement. RESOLVED FURTHER: That this corporation save, defend, indemnify and hold harmless the persons who entered into said contracts and transactions on behalf and for the benefit of this corporation, from and against any liability or expense arising therefrom and thereunder. AUTHORIZE ISSUANCE OF SHARES SH ARES The matter of issuing shares of the corporation's corporation’s capital stock was then considered, and upon motion duly made and seconded, the following resolutions were unanimously adopted: RESOLVED: That the officers of this corporation be, and they hereby are, authorized to sell and issue to the following persons the number of shares of capital stock of this corporation and for the consideration indicated opposite each name: VERSAA Group, LLC Nominee of Bobby Bedi 50,000shares shares 50,000 Biztank Group, LLC, Nominee of Jason Cardiff 50,000 shares for non-cash services rendered at $10,000.00 for non-cash services sendees rendered at $10,000.00 RESOLVED FURTHER: That the Board hereby determines the fair value to the corporation of the above-referenced non-cash consideration received by it for the issuance of its shares of capital stock is not less than the amounts respectively set forth above. RESOLVED FURTHER: That all such shares authorized above shall 24 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 25 of 43 Page ID #:16520 be sold and issued without the publication of any advertising or general solicitation. RESOLVED FURTHER: That such shares shall be issued within the exemption from qualification afforded by Section 25102(f) of the California Corporate Securities Law of 1968 and shall, in all respects, meet the requirements thereof: RESOLVED FURTHER: That each of the proposed issuees shall execute an investment representation letter with respect to the purchase of the securities of the corporation, and set forth therein their respective preexisting personal or business relationship with one or more of the corporation’s corporation's directors or officers, or business or financial experience ((or or that of their professional advisors who are not in any way affiliated with or compensated by this corporation or its agents) by reason of which they can reasonably be assumed to have the capacity to protect their own interests in connection with the transaction. RESOLVED RESOL VED FURTHER: The officers and directors of this corporation shall cause to be prepared, executed and timely filed with the California Commissioner of Business Oversight, a Notice in the form prescribed pursuant to Section 25102(f), and shall take such other further action as may be necessary or desirable to effectuate the foregoing resolutions. RESOLVED FURTHER: That this corporation is a small business corporation as defined in Section 1244 of the Internal internal Revenue Code, and that the shares of its capital stock to be sold and issued hereunder shall be sold and issued to the extent they qualify as such pursuant to Section 1244 of the Internal Revenue Code. Code. SUB-CHAPTER S ELECTION The matter of electing to be taxed pursuant to Section 1362(a) 1362( a) of the Internal Revenue Code was next considered, and upon motion duly made and seconded, the following resolutions were unanimously adopted: WHEREAS, the directors of this corporation deem it appropriate for 25 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 26 of 43 Page ID #:16521 the corporation to elect to be a small business corporation pursuant to Section 1362(a) of the Internal Revenue Code and to be an "S" “S” corporation for tax purposes. RESOLVED: That this corporation hereby elects, pursuant to Section 1362(a) of the Internal Revenue Code, to be an "electing “electing small business corporation" corporation” and to be taxed under the Internal Revenue Code Subchapter S, such election to be effective for the current fiscal and thereafter unless changed by Board action. RESOLVED FURTHER: That the officers of this corporation are hereby authorized and directed to prepare, cause to be executed and to be filed with the appropriate office of the Internal Revenue Service, IRS Form 2553 together with the statement of each shareholder consenting to the Subchapter S election (together with a similar consenting statement by each shareholder's shareholder’s spouse), on or before (date), and to execute such documents and take such other action as they may deem necessary or desirable to make the Subchapter S election effective. There being no further business to come before the meeting, upon motion duly made, seconded and unanimously carried, the meeting was adjourned. Jason Cardiff, Secretary ATTEST: Bobby Bedi, Chairperson 26 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 27 of 43 Page ID #:16522 EXHIBIT 5 27 please tinct nnd tor tor payment payment amae amae on on tHS t>-» please Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 28 of 43 Page ID #:16523 Subject: please please find find for for payment payment amde amde on on 6-8 6-8 Subject: From: Jason Cardiff Cardiff From: 1:15 PM PM Date: 6/8/2020, 1:15 To: To: Bobby Bedi , , Edward Edward Jimenez Jason Cardiff Here to Help, Viral Protection Labs Rancho Cucamonga Ca Cell Office www.vn lmedical.com - Attachments: -------------------------—- -----------------------------------(2020-06-09/ZhiYANG)Proformalnvoice.pdf (2020-06-09,ZhiYANG)Proformalnvoice.pdf 120 KB 28 ) Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 29 of 43 Page ID #:16524 Zhejiang Yiyang Machinery Technology Co.,Ltd 7!7AN*G No.288 North Zhenghan Street,Xietang Industrial Park,Jindong Park,iindong District,Jinhua 321036,China Phone:+8613757949968 Phone:+86l3757949968 Email: Sales@yiyang-machine.com MECHANICAL PROFORMA INVOICE :R :r 3. Delivery DeliveryAddress Address INVOICE NO. PI-YYM20200609 PI-YYM202G0SG9 DATE ofJune, June,2020 2020 09thof 09th 6. Special Remarks (1) BUYER shall pay in accordance with the terms and condition agreed. :; Yiyang Machinery Technology Co.,Ltd (2) SELLER shall build the machine in accordance with the technical \Jorth Zhenghan Street,Xietang Industrial Park, Morth 4. Price Term District,Jinhua DistricUinhua 321036,China 11 specifications and fulfil the machine performnace agreed. (3) Both BUYER and SELLER shall not disclose the Confidential information FOB SHANGHAI 82982055 F.86 579 82982055 •ang-machine.com 'ang-machine com 5. Payment Term R R Payment shall be made by by Bank wire transfer Bankwire ~dical Inc idical 50% Down payment upon Order confirmation row Route Suite 290 o Cucamonga 50% Before Shipment ITEM DESCRIPTION SEPCIFICATION PICTURES Q'TY Unit Price 1 SET $40,000/SET $40,000/SE Amount SPECIAL REMARKS & 4 Ply face mask •- 3 & manufacturing machine Flat Face Mask Machine Set M-1-2 M-l-2 al For Face Mask at Melt blown Non-woven Non~woven Fabric Non-woven Fabric Ear loop String Plastic Nose Piece 2 T 2T 4T 0.7T 0.4T $30,000 $30,000 $6,000 $6,000 $11,500 $11,500 $7,600 $7,600 _.MQ,000 $40,000 $60,000 $24,000 $8„050 $8,,050 $3,040 IN TOTAL: $135,090 ial Terms and Conditions itit Terms BVT£ !l!l!. 0%, Down payment upon Order Confirmation Shipment / Upon receipt of Shipping documents 100%, Before Shipment/ 29 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 30 of 43 Page ID #:16525 ACCOUNT WITH INSTITUTION: NAME: CHINA CONSTRUCTION BANK JINHUA BRANCH SWIFT:PCBCCNBJZJG SWIFT.PCBCCNBJZJG ADD :NO. 1 JIEFANG EAST ROAD,JINHUA,ZHEJIANG, ADD:NO. 1JIEFANG ROADJINHUA,ZHEJIANG, CHINA A/C NO.: 33050167113500000377 BENEFICIARY NAME NAME:: ZHEJIANG YIYANG MACHINERY TECHNOLOGY CO.,LTD INTERMEDIARY BANK: BANK: :CITIBANK N.A., NEWYORK _____________ NAME NAME:CITIBANK SWIFT CODE:CITIUS33 ivery erm of Del Delivery (lncoterms 2010) FOB SHANGHAI port (Incoterms elivery Time The Goods shall be ready for shipment within 7days after receipt of the Down payment. payment. elivery Address VPL Medical Modical Inc 9007 Arrow Route Suite 290 Rancho Cucamonga 91730 larrnaty farrnaty machine. The warratny period of 12 months starts after final acceptance upon the successful installation of the machine. Consumables and parts that are subject to wear and tear are excluded from the warranty 8. SELLER Zhejiang Yiyang Machinery technology .,Ltd 9.BUYER 30 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 31 of 43 Page ID #:16526 EXHIBIT 6 31 V rL lVIt:UILcU 11.Wdl-u VTL. lvitJUH.cU T+ Vfl V/i ~Ulllri:iLL L.UIIUcll.1/iWcH U tt.:>O~J.UA.l.UrUU;:)U tf-OOL.XUA£UrUUOU Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 32 of 43 Page ID #:16527 Subject: VPL Medical + VA Contract Award #36C10X20POOSO #36C10X20P0050 From: Stacey Barker Date: 4/17/2020, 1:44 PM To: sandra.bullock@va.gov CC: Jason Cardiff , Bobby Bedi Hello Sandra, Nice to e-meet you. Know that VPL Medical is elated to be working with the VA on contract# contract # 0050 and collectively help save lives. II have CC'd CC’d the President (Bobbi) and CEO (Jason) so you can familiarize yourself with them as well. Enjoy your day and looking forward to our future communications. Stacey D. Barker VPL, Enterprise Account Executive sb@vplmedical.com sb@vplmeclical.com c: 323.833.8358 32 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 33 of 43 Page ID #:16528 EXHIBIT 7 33 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 34 of 43 Page ID VPL Medical Inc. #:16529 Cash Receipts & Disbursements - Chase Account#5799 All Transactions from March 30, 2020 to June 26, 2020 Based on its Banking Records Apr 30, 20 10,500.00 May 31, 20 100,661.54 Jun 26, 20 1,039,988.12 TOTAL 0.00 0.00 0.00 3,183,975.00 2,218,675.87 5,402,650.87 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 301,375.00 301,375.00 860,000.00 (860,000.00) 0.00 1,818,629.00 1,818,629.00 0.00 0.00 0.00 0.00 0.00 860,000.00 (860,000.00) 0.00 2,120,004.00 2,120,004.00 0.00 0.00 111,633.95 0.00 111,633.95 0.00 0.00 0.00 800,000.00 0.00 800,000.00 0.00 (800,000.00) (800,000.00) 0.00 0.00 0.00 800,000.00 (800,000.00) 0.00 Dipak Patel & Dipti Patel Receipt Payment Total Dipak Patel & Dipti Patel 0.00 0.00 0.00 0.00 0.00 0.00 350,000.00 (385,000.00) (35,000.00) 0.00 0.00 0.00 350,000.00 (385,000.00) (35,000.00) Total Potential Investors/Lenders 0.00 1,101,375.00 1,095,262.95 0.00 2,196,637.95 0.00 0.00 10,500.00 0.00 0.00 0.00 34,130.24 15,750.00 44,382.50 29,499.44 0.00 21,442.65 24,750.00 0.00 0.00 79,500.00 0.00 0.00 0.00 0.00 79,500.00 55,572.89 51,000.00 44,382.50 29,499.44 0.00 0.00 0.00 6,070.37 0.00 6,070.37 4,218.39 0.00 4,218.39 5,896.10 (6,072.50) (176.40) 16,184.86 (6,072.50) 10,112.36 0.00 265.00 0.00 0.00 265.00 1,000.00 (1,000.00) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1,000.00 (1,000.00) 0.00 0.00 0.00 0.00 0.00 0.00 265.00 (4,100.00) 0.00 (4,100.00) (4,600.00) (11,000.00) (15,600.00) (8,700.00) (11,000.00) (19,435.00) 10,500.00 1,231,472.55 4,325,548.99 2,282,399.47 7,849,921.01 Beginning Balance Receipts VA Services & Distribution Center (via ACH) Potential Investors/Lenders Wave Crest Management Receipt Payment Keith Langlands Ttee Total Wave Crest Management Aries Funding Source LLC Professional Rx Pharmacy LLC Receipt Payment Total Professional Rx Pharmacy LLC M. Boynton Square Inc. Medx Airone LLC Auditor's Warrant F. Fardad Stripe Receipts Payments Total Stripe Chase Accounts CHK 2165 CHK 2882 Receipt Payment Total CHK 2882 CHK 9138 CHK 5178 Total Chase Accounts Total Receipts Mar 31, 20 0.00 Page 1 of 3 34 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 35 of 43 Page ID VPL Medical Inc. #:16530 Cash Receipts & Disbursements - Chase Account#5799 All Transactions from March 30, 2020 to June 26, 2020 Based on its Banking Records Mar 31, 20 Apr 30, 20 May 31, 20 Jun 26, 20 TOTAL 0.00 0.00 0.00 0.00 0.00 1,121,439.00 0.00 0.00 0.00 1,121,439.00 1,143,235.00 1,070,703.59 0.00 0.00 2,213,938.59 0.00 120,662.50 165,090.00 120,000.00 405,752.50 2,264,674.00 1,191,366.09 165,090.00 120,000.00 3,741,130.09 Related Parties Versaa Group LLC (Bedi) Bobby Bedi Biztank Group LLC (Cardiff) Jason Cardiff VPL new account at Citizens Business Bank Total Related Parties 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5,000.00 0.00 5,000.00 0.00 10,000.00 400,000.00 5,000.00 400,000.00 5,000.00 0.00 810,000.00 10,000.00 0.00 10,000.00 0.00 100,000.00 120,000.00 410,000.00 10,000.00 410,000.00 10,000.00 100,000.00 940,000.00 Lease Dett Properties Inc. Teamrise Bell Tower AP LLC Total Lease 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5,000.00 5,000.00 68,495.00 0.00 68,495.00 68,495.00 5,000.00 73,495.00 Employees/Contractors S. Barker (including $250K commission) J. Byun J. Wan S. Holguin E. Jimenez O. Mendez Total Employees/Contractors 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5,070.98 4,400.00 0.00 0.00 9,470.98 257,587.84 35,450.00 8,577.84 5,000.00 300.00 950.00 307,865.68 0.00 1,040.00 0.00 0.00 865.00 200.00 2,105.00 257,587.84 36,490.00 13,648.82 9,400.00 1,165.00 1,150.00 319,441.66 Disbursements Significant Vendors Qingdao Tianyiquan Trading Co. (China) EDM International Logistics Inc. Zhejiang Yiyang Machinery Technology (China) Taizhou Beiping Machine Tool Co (China) Total Significant Vendors Everwan International Corp. ZAPP Packaging Unknown Freight Vendor Luxury Escrow Inc. Payment Receipt Total Luxury Escrow Inc. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 15,980.00 21,607.50 17,710.00 0.00 21,607.50 17,710.00 15,980.00 0.00 0.00 0.00 0.00 (625.00) (625.00) 12,999.99 0.00 12,999.99 0.00 0.00 0.00 12,999.99 (625.00) 12,374.99 Snyder & Snyder Construction FDA User Fee Bahr LLC P. Caufield Dunkel Bros Machinery Moving Venmo J. Singh CBIO Brand Distribution Int'l Inc. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 565.00 0.00 0.00 0.00 5,236.00 4,500.00 3,500.00 0.00 0.00 0.00 2,267.20 10,800.00 0.00 0.00 0.00 2,740.00 2,000.00 2,520.00 0.00 10,800.00 5,236.00 4,500.00 3,500.00 2,740.00 2,565.00 2,520.00 2,267.20 Page 2 of 3 35 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 36 of 43 Page ID VPL Medical Inc. #:16531 Cash Receipts & Disbursements - Chase Account#5799 All Transactions from March 30, 2020 to June 26, 2020 Based on its Banking Records UPS Wise Owl Media Group C. Rogers T-Mobile Braunwalder Insurance Print Connection LLC Apple.Com R. Emperado Small unknown payments Reliance Transport Sierra Lakes Golf Club Goose Creek Golf Club Vision Security Systems Lowe's Freshbooks Bank Service Fees The Hitch Burger Grill Stamp.com Total Disbursements Mar 31, 20 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 Apr 30, 20 386.03 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 75.00 0.00 0.00 0.00 1,141,311.01 May 31, 20 756.48 1,250.00 1,500.00 0.00 0.00 0.00 20.47 0.00 750.00 0.00 340.00 318.00 0.00 0.00 0.00 0.00 0.00 0.00 3,386,222.41 Jun 26, 20 677.36 450.00 0.00 1,284.54 1,262.66 1,000.00 972.67 800.00 0.00 575.00 0.00 0.00 230.00 189.16 75.00 125.00 22.70 17.99 661,412.08 TOTAL 1,819.87 1,700.00 1,500.00 1,284.54 1,262.66 1,000.00 993.14 800.00 750.00 575.00 340.00 318.00 230.00 189.16 150.00 125.00 22.70 17.99 5,188,945.50 Net Receipts During the Month 10,500.00 90,161.54 939,326.58 1,620,987.39 2,660,975.51 Month-End Balance 10,500.00 100,661.54 1,039,988.12 2,660,975.51 2,660,975.51 Page 3 of 3 36 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 37 of 43 Page ID #:16532 EXHIBIT 8 37 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 38 of 43 Page ID #:16533 21, 2020 (10:12am) V7/ April 21,2020 Memoraodum Memorandum of Agreement THIS MEMORANDUM OF AGREEMENT is made this 21st day of April, 2020 in Laguna Beach, California by and between VPL Medical, Inc. a California corporation ("VPLMI"), with its office at 9007 Arrow Route, Suite 290, Rancho Cucamonga, CA 91730 and (“VPLMI”), ("WCM") with its office at 8905 W Post Rd., Suite 210 Las Vegas, NV Wave Crest Management (“WCM”) 89148. The undersigned confirm and agree as follows: 1. ("VPLMI") has procured a substantial VPL Medical, Inc. a California corporation (“VPLMT’) ("The "Order") from the United States Department of Veterans Affairs (“The order (the “Order”) Department") for certain personal property goods, specifically, the following surgical Department”) masks: 4,000,000 3 ply level II masks, ill and 4,000,000 3 ply level HI masks. 2. The Order calls for the goods to be manufactured in China and calls for a tight delivery schedule of the product over time and in two tranches. 3. IfVPLMI If VPLMI is able to satisfy The Department vis a vis the Order, then VPLMI envisions a high probability that The Department may place additional orders for masks and other products with VPLMI. 4. VPLMI has arranged for the masks to be manufactured in China by a company known to VPLMI which has previously provided quality mask products. 5. To commence manufacture and shipment of the first tranche of product for the Order, the manufacturer and shipping and customs agents require a total amount of $1,460,000 by wire as soon as possible to lock in the price of the product for the Order. 6. WCM has agreed to forthwith wire funds sufficient to make the deposit required to timely manufacture and ship the first tranche of the Order. 7. To commence manufacture and shipment of the second tranche of product for the Order, the manufacturer and shipping and customs agents are expected to require a further deposit of $1,460,000 by wire as soon as possible to manufacture and ship the second tranche. 8. The parties contemplate that The Department will pay for for the first tranche of 38 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 39 of 43 Page ID #:16534 product in advance of the time when the second deposit needs to be made and in that event, the second deposit will be paid from VPLMI funds, but in the event that the second deposit cannot be made from VPLMI funds, then for the additional consideration described below, WCM has agreed to forthwith wire funds sufficient to make the deposit required to timely manufacture and ship both tranches of the Order. 9. VPLMI shall provide to WCM bank wiring instructions forthwith. 10. The Order provides that The Department will pay for all conforming product received within three days of receipt by The Department. 11. Theparties partieshave haveagreed agreedthat thatwithin within24 24hours hoursof ofpayment paymentby byThe TheDepartment Departmentfor for The the first tranche of product, VPLMI shall reimbursed WCM for the amount advanced by WCM for the first tranche, (together with a fee calculated at five cents per mask which fee is contemplated to be $200,000). 12. The parties have further agreed that in the event that WCM is called upon and is required to make the second deposit, then within 24 hours of payment by The Department for the second tranche of product, VPLMI shall reimburse WCM for the amount advanced by WCM for the second tranche, together with a fee calculated at seven and 1/2 cents per mask contemplated to be $300,000 fee for such advance deposit made by WCM. 13. Because the parties contemplate the potential for future orders from The Department and the need to finance those orders with deposits as needed, WCM shall have a right of first refusal to provide financing for all future capital investment needs for future orders or products. In the event of an extension of the present contract with The Department past the current Order for two tranches, WCM retains the right to roll its $1,460,000 investment into future tranches with the continued return of $0.05 per mask per tranche. In the event there is no extension of the present contract with The Department for additional product or at the expiration of the contract, the $1,460,000 advanced by WCM shall be reimbursed to WCM within 48 hours, if not already previously returned. 14. The parties further agree that as security for the repayment of funds advanced by WCM and for its fees, VPLMI hereby grants to WCM a first lien personal property security interest in the goods and proceeds therefrom and the parties shall cooperate in forthwith filing an appropriate UCC-1 Financing Statement in all appropriate jurisdictions. 15. The parties further agree that in the event The Department rejects all or a material portion of the tendered goods, then WCM and VPLMI shall jointly take possession and coownership of rejected goods, if any, and the parties will cooperate in an effort to sell the product so as to mitigate their respective losses. In the event that the factory fails fails to ship the 39 • Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 40 of 43 Page ID #:16535 product, VPLMI shall provide WCM wtth with an additional 4,000,000 masks within 120 days to compensate WCM for its losses. 16. The parties further agree that VPLMI shall keep WCM fully informed of the progress of the fulfilment of the Order, including full transparency of the status of the manufacturing process and the status of transit and tender. 17. At the present time, it is contemplated that the goods will be shipped by air to The Department and presented in Chicago, Illinois for US Customs Clearance and thereafter, it is contemplated that the goods will then be onward shipped for tender to The Department at a receiving depo as directed by The Department. 18. The parties further agree to maintain all aspects of this transaction as confidential information except as to their respective advisors and counsel and to make appropriate disclosures ifrequired ifrequired byapplicable law or with the consent ofthe other party; that this MOU shall be governed by the laws of the State of California; and that this MOU shall be construed according to its fair meaning and not strictly for or against any Party. CONFIRMED AND AGREED VPL Medical, Inc. a California corporation Boh by Bedi, its President Wave Crest Management By:~ed;(,~ Langland?, its Managing Member Keith Langland,itsManaging 40 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 41 of 43 Page ID #:16536 1 PROOF OF SERVICE 2 FTC v. Jason Cardiff Case No. 5:18-cv-2104 3 4 I, the undersigned, declare and certify as follows: I am over the age of eighteen years, not a party to the within action and employed in the County of Los Angeles, State of California. I am employed in the 5 office of Frandzel Robins Bloom & Csato, L.C., members of the Bar of the above6 entitled Court, and I made the service referred to below at their direction. My business address is 1000 Wilshire Boulevard, Nineteenth Floor, Los Angeles, CA 90017-2427. 7 On June 29, 2020, I served true copy(ies) of the REPORT OF THE TEMPORARY RECEIVER ROBB EVANS & ASSOCIATES, LLC OVER 9 AND REGARDING VPL MEDICAL, INC,, the original(s) of which is(are) affixed hereto. to the party(ies) on the attached service list. 10 SEE ATTACHED SERVICE LIST 11  BY CM/ECF NOTICE OF ELECTRONIC FILING: I electronically filed the document(s) with the Clerk of the Court by using the CM/ECF system. 12 Participants in the case who are registered CM/ECF users will be served by the CM/ECF system. Participants in the case who are not registered CM/ECF 13 users will be served by mail or by other means permitted by the court rules. 14 I declare under penalty of perjury under the laws of the State of California and the United States of America that the foregoing is true and correct. 15 1000 WILSHIRE BOULEVARD, NINETEENTH FLOOR LOS ANGELES, CALIFORNIA 90017-2427 (323) 852-1000 FRANDZEL ROBINS BLOOM & CSATO, L.C. 8 16 Executed on June 29, 2020, at Los Angeles, California. 17 18 /s/ Sandra Young-King Sandra Young-King 19 20 21 22 23 24 25 26 27 28 3818533.1 078410-0061 4 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 41 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 42 of 43 Page ID #:16537 SERVICE LIST FTC v. Jason Cardiff Case No. 5:18-cv-2104 1 2 3 4 5 6 7 8 10 1000 WILSHIRE BOULEVARD, NINETEENTH FLOOR LOS ANGELES, CALIFORNIA 90017-2427 (323) 852-1000 FRANDZEL ROBINS BLOOM & CSATO, L.C. 9 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Electronic Mail Notice List • Elizabeth J Averill eaverill@ftc.gov • Peter Bisno pbisno@bisnolaw.com • Michael Anthony Brown tbrown@spertuslaw.com • Witt W Chang wwchang@venable.com,wchang@venable.com,rrubio@venable.com • Stephen R Cochell srcochell@gmail.com • Roger A Colaizzi rcolaizzi@venable.com,SHRoss@venable.com,VGBranch@Venable.com,DC LitigationDocketing@Venable.com • Christopher David Crowell ccrowell@hrhlaw.com • Michael Gerard Fletcher mfletcher@frandzel.com,sking@frandzel.com • Hal D Goldflam hgoldflam@frandzel.com,bwilson@frandzel.com • Allan Howard Grant allan@grants-law.com • Dolly Kae Hansen dolly@spertuslaw.com • Lindsey M Hay lhay@spertuslaw.com • Inter/Media Time Buying Corporation ccrowell@hrhlaw.com • Michael W Kinney mkinney@lblglaw.com • Shira D Modell smodell@ftc.gov 28 3818533.1 078410-0061 5 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 42 Case 5:18-cv-02104-DMG-PLA Document 365 Filed 06/29/20 Page 43 of 43 Page ID #:16538 1 2 3 4 5 6 7 8 10 1000 WILSHIRE BOULEVARD, NINETEENTH FLOOR LOS ANGELES, CALIFORNIA 90017-2427 (323) 852-1000 FRANDZEL ROBINS BLOOM & CSATO, L.C. 9 11 12 13 14 15 • Stacy Rene Procter sprocter@ftc.gov • James A Prunty jprunty@ftc.gov • Edwin Rodriguez erodriguez@ftc.gov • Ari N Rothman anrothman@venable.com,rrubio@venable.com • Elizabeth Jones Sanger esanger@ftc.gov,csands@ftc.gov • James W Spertus jspertus@spertuslaw.com,sluecf@spertuslaw.com • Jesse James Thaler jessejthaler@gmail.com • Gerrick M Warrington gwarrington@frandzel.com,dmoore@frandzel.com • Craig A Welin cwelin@frandzel.com,bwilson@frandzel.com • James D White jdw@jamesdwhitelaw.com 16 17 18 19 20 21 22 23 24 25 26 27 28 3818533.1 078410-0061 6 INITIAL REPORT OF RECEIVER ROBB EVANS & ASSOCIATES LLC REGARDING VPL MEDICAL, INC. 43