Form 8-46

NOTICE: THIS DOCUMENT
CONTAINS SENSITIVE DATA

[Caption. See § 3 of the Introduction in volume 1 of this manual.]

Order on Motion for Appointment of Receiver

[Business]

On [date] the Court considered the Motion for Appointment of Receiver of [name of movant], Movant, which requested the immediate appointment of a receiver to take charge and possession of property owned by [Petitioner, [name], and Respondent, [name],/Petitioner, [name],/Respondent, [name],] consisting of a business that operates under the name of [name] (“Business”) and is located at [street address, city, state] and to [sell/operate/operate, includ­ing rehabilitate or liquidate,/operate and sell] the same. The Court, after considering the plead­ings, evidence, and argument of counsel, is of the opinion that sufficient grounds exist for the immediate appointment of a receiver. Movant has complied with all requirements of the law, all other available legal and equitable remedies are inadequate, and the facts and circum­stances in this lawsuit necessitate the appointment of a receiver to [sell/operate/operate, including rehabilitate or liquidate,/operate and sell] Business to avoid irreparable damage to Movant and other interested parties.

The Court finds that [name] is a registered voter, citizen, and resident of Texas and is qualified to serve as Receiver.

IT IS THEREFORE ORDERED that [name] is appointed Receiver to take charge and possession of Business and to [sell/operate/operate, including rehabilitate or liquidate,/operate and sell] the same.

IT IS FURTHER ORDERED that on filing of a bond fixed and approved by this Court in the amount of [number] dollars ($[amount of bond]) and Receiver’s sworn oath to perform and faithfully discharge [his/her] duties as Receiver in this lawsuit in obedience to the orders of this Court, Receiver shall be and hereby is given the power and authority to do all acts nec­essary to [sell/operate/operate, including rehabilitate or liquidate,/operate and sell] the Prop­erty (as defined below) of Business (the “Receivership Estate”), including the following:

1.Property.      Take immediate and exclusive possession, custody, and control of all interests in Business and collateral of Business, whether real or personal, tangible or intangi­ble, and wherever located (collectively, the “Property”); subject, however, to compliance with the terms and conditions of all agreements and other instruments relating to the ownership, lease, use, or occupancy thereof. Receiver is granted the power and authority to perform all acts necessary to conserve, hold, manage, and preserve the value of the Receivership Estate, in order to prevent any irreparable loss, damage, or injury to the Receivership Estate. Receiver shall be entitled to the assistance of law enforcement officials, if necessary, to take possession, custody, and control of the Property or at any other time during the Receivership as necessary to preserve the peace and protect the Property of the Receivership Estate.

2.Operations and Control.      Operate, manage, [include if applicable: sell,] control, and conduct business operations in the ordinary and usual course and do all things and incur the risks and obligations ordinarily performed or incurred by owners, managers, and operators of similar businesses while having exclusive and sole control of and authority to act for Busi­ness, to the exclusion of all others, including all other management currently in place; PRO­VIDED THAT notwithstanding anything contained in this order to the contrary, Receiver may not [include if applicable: except as otherwise provided in this order] (a) create, incur, assume, or suffer to exist any indebtedness, obligations, or liabilities other than in the ordinary course of business; (b) sell, lease, transfer, or otherwise dispose of any of the Property of Business, except the sale of inventory in the ordinary course of business; or (c) acquire all or a substan­tial portion of the assets or equity interests of any person or entity without the prior written consent of the Court. Receiver shall have all powers, authorities, rights, and privileges hereto­fore possessed by any and all officers, directors, managers, and other governing agents of Business.

3.Bank Accounts.      Take immediate and exclusive possession, custody, and control of all bank accounts, deposit accounts, commodity accounts, and securities accounts belong­ing to Business at any financial institution, and receive from all depositories, banks, broker­ages, persons, or entities holding any funds on deposit arising from, or related to, the Property of the Receivership Estate or belonging to Business whether those funds are in an account in the name of Business or not, and Receiver may indemnify the institution on which such demand is made and is empowered to open or close any such accounts. Receiver shall have authority and custody of all credit card merchant accounts, such as Visa, MasterCard, Ameri­can Express, Discover, or otherwise, whether those funds are in accounts in the name of Busi­ness or not. Receiver shall also have authority and custody over all gift card accounts in the name of Business. Receiver shall deposit funds collected and received in connection with the Receivership Estate into one or more accounts maintained at a federally insured banking insti­tution. Monies coming into the possession of Receiver and not expended for any purpose authorized by this order shall be held by Receiver pending further orders of this Court. All financial institutions, on presentation of a copy of this order, shall provide copies of any requested records regarding any such accounts to Receiver. Receiver may add [his/her] agents or employees as additional signatories to any bank accounts, money market accounts, certifi­cates of deposit, or other financial instruments or accounts controlled by Receiver.

4.Checks.      Receive and endorse checks made payable to Business or relating to the Property of the Receivership Estate, either in the name of Receiver or in the name of Business.

5.Debts and Obligations.      Collect or compromise debts of the Receivership Estate and incur any risks and obligations ordinarily incurred by owners, managers, and operators of similar businesses that, in Receiver’s reasonable judgment, are necessary for the management, operation, preservation, rehabilitation, or liquidation of the Receivership Estate. Receiver may demand, collect, and receive all rents, profits, and other income from the Property of the Receivership Estate, or any part of the same that is owed, unpaid, and collected or uncollected as of the effective date of this order or that hereafter becomes due. Any such risks or obliga­tions incurred by Receiver in performance of [his/her] duties as Receiver pursuant to this order shall be a risk or obligation of the Receivership Estate and not personally of Receiver.

6.Loans and Contributions of Funding.      Borrow from, and pay amounts due to, Movant or third parties for funding of amounts required to continue the management, opera­tion, preservation, rehabilitation, or liquidation of the Receivership Estate or, in the event the income of the Receivership Estate is insufficient to meet expenses, on such terms and condi­tions as Receiver deems reasonable.

7.Income.      Collect all rents, profits, and other income and collect money or prop­erty owed by any third party to Business that now or hereafter may be due from the manage­ment or operation of the Receivership Estate.

8.Employees and Agents.      Hire, retain, or terminate employees, independent con­tractors, consultants, attorneys, certified public accountants, brokers, security guards, book­keepers, and other parties or agents of Business, in the management and operation of the Property of the Receivership Estate as Receiver deems appropriate and pay the reasonable value of the services rendered by those parties, in which case payroll taxes, workers’ compen­sation insurance, and related costs will be carried and reported as those of Business. Receiver will not be bound by Business’s employment contracts, collective-bargaining agreements, or employment practices, policies, or benefits. Receiver shall have the sole and exclusive author­ity to direct employees, contractors, bankers, investment advisors, accountants, attorneys, and other agents of Business.

9.New Contractors.      Employ, on a contract basis, professionals, agents, employees, or contractors and purchase inventory, tools, merchandise, material, services, software, and supplies, at ordinary and usual rates and prices, using funds that come into [his/her] posses­sion as Receiver.

10.Professionals.      Hire, employ, and retain independent legal counsel, certified pub­lic accountants, appraisers, leasing agents, investigators, security guards, technical and other consultants, brokers [include if applicable: including business brokers], property management companies, and any other personnel or employees Receiver deems necessary to advise, assist, or represent Receiver in performance of [his/her] duties and obligations pursuant to this order, at ordinary and usual rates and prices, using funds that come into [his/her] possession as Receiver.

11.Mail.      Open and review all mail, packages, or other deliveries directed to Busi­ness or its agents or representatives, and issue demand to the U.S. Postal Service granting Receiver exclusive possession and control of mail, including postal boxes as may have been used by Business, and directing that certain mail related to the Receivership Estate be directed to Receiver.

12.Insurance.      Enter into, adjust, or maintain existing insurance necessary to protect and preserve the Property of the Receivership Estate. That insurance shall be in an amount that Receiver deems sufficient. [Include if applicable: For any existing insurance, Movant shall be named as an additional insured on the policies during the Receivership.] If sufficient cover­age does not exist, Receiver shall immediately notify the parties to this divorce and shall have thirty calendar days to procure sufficient all-risk and liability insurance on Property of the Receivership Estate. If Receiver does not have sufficient funds to procure sufficient coverage, Receiver shall seek instructions from this Court with regard to adequately insuring the Prop­erty of the Receivership Estate. Receiver shall not be responsible for claims arising from the lack of procurement or inability to obtain insurance.

13.Licenses and Permits.      Take immediate and exclusive possession, custody, and control of all licenses, permits, or other government-issued documents necessary for the con­tinued operation of Business, including any permit or license issued in the name of Business or a related entity of Business that is required and necessary for the continued operation of Business. If the issuing agency requires that Receiver apply for a new license, permit, or other document, Receiver is authorized to continue to perform his duties as Receiver pending issu­ance of that new permit or license.

14.Interests.      Take immediate and exclusive possession, custody, and control of all membership interests, partnership interests, stock, and other legal rights and interests of Busi­ness in any limited liability company, partnership, corporation, or other entity or relationship.

15.Authorized Signatory.      Execute all contracts and other documents and perform all acts and obligations in relation thereto, in the name of Business, Receivership Estate, or Receiver, as necessary for the management, operation, preservation, rehabilitation, or liquida­tion of the Receivership Estate.

16.Leases.      Negotiate, enter, or extend any lease for a period not to exceed one year, unless ordered by this Court, and modify or terminate existing leases affecting part or all of the Receivership Estate that are not commercially reasonable or beneficial to the operation of the Receivership Estate.

17.Other Contracts.      Negotiate, enter, or extend any contract as Receiver deems necessary for the management, operation, preservation, rehabilitation, or liquidation of the Receivership Estate, including any purchase agreements or management contracts associated with such management, operation, preservation, rehabilitation, or liquidation of the Receiver­ship Estate, for a period not to exceed one year, unless approved by this Court, and modify or terminate existing contracts affecting part or all of the Receivership Estate that are not com­mercially reasonable or beneficial to the operation of Receivership Estate.

18.Debt Collection.      In Receiver’s sole discretion, issue demands and bring and prosecute all proper actions for the collection of accounts receivable or contract rights of Business when due.

19.Litigation.      In Receiver’s sole discretion, bring, prosecute, defend, or resolve any lawsuit commenced by or against Business and employ attorneys, experts, or other third par­ties Receiver deems necessary to prosecute or defend such lawsuits, for the rehabilitation or liquidation of Business for the benefit of Business’s creditors.

20.Statutory Powers and Duties.      Exercise all powers and discharge all duties pro­vided to receivers pursuant to chapter 64, subchapter C, of the Texas Civil Practice and Rem­edies Code and other law applicable to receivers.

21.Court Orders.      Perform all other lawful acts necessary to discharge Receiver’s duties pursuant to this order or any other court order, including seeking relief from this Court or, as may be necessary, instituting ancillary proceedings in this Court to recover assets or records belonging to Business, to recover fraudulent or otherwise improper transfers, or to assert any cause of action or claim belonging to Business.

Inventory

IT IS FURTHER ORDERED that as soon as possible after appointment, but in any event no later than [number] days after entry of this order, Receiver shall file with this Court an inventory of all Property over which Receiver has taken possession, custody, and control pursuant to this order.

Delivery of Receivership Estate and Income and Revenues

IT IS FURTHER ORDERED that on notice to Business and the parties of this order, Business and parties (1) shall peacefully and immediately, but in no event less than forty-eight hours therefrom, surrender, turn over, and deliver to Receiver the Receivership Estate, includ­ing all records, books of account, executed originals of leases, contracts, insurance policies, sales tax returns, documents, and papers, and all revenues and income generated from the Property of Business in their possession, custody, or control; (2) are directed to cooperate with Receiver and to disclose all information relating to the management and operation of the Receivership Estate, including the names of all vendors and suppliers, copies of bills, service contracts, and bank accounts in their possession, custody, and control, and to turn over to Receiver any other material in their possession, custody, or control relevant and necessary in the opinion of Receiver to the fulfillment of [his/her] duties as Receiver pursuant to this order; (3) shall prepare and provide to Receiver an itemization as to the Receivership Estate of all accounts payable and receivable and operating expenses paid during this transition period; and (4) shall provide Receiver with access to all accounts, records, files, user names, and pass­words maintained in connection with the Receivership Property and needed to access Busi­ness’s accounts.

IT IS FURTHER ORDERED that Business shall instruct all employees, agents, or oth­ers now or hereafter in possession of any portion of the Receivership Estate to contact Receiver to arrange for the immediate turnover of the Receivership Estate to Receiver as Receiver may direct.

IT IS FURTHER ORDERED that if a party violates a material provision of this order, Movant or Receiver may petition this Court to issue an order to show cause why such party should not be found to be in contempt. All persons are hereby directed to comply with this order and any lawful instructions of Receiver made pursuant to the authority granted in this order. Nothing in this order shall require individuals to perform work at the behest of Receiver without fair compensation.

Overhead Expenses of Receiver

IT IS FURTHER ORDERED that all fees and expenses incurred by Receiver that per­tain solely to Receiver’s general office administration or overhead, including office supplies, employee wages, taxes, and benefits, and other charges, shall not be an expense of the Receiv­ership Estate unless incurred directly and solely for the benefit of the Receivership Estate.

Termination Order

IT IS FURTHER ORDERED that as soon as practicable after termination of this Receivership, Receiver shall file, serve, and set for hearing in this Court [his/her] Final Report and Accounting. Notice shall be given to all persons for whom Receiver has received notice of potential claims against the Receivership Estate. The motion to approve the final report and accounting, and for discharge of Receiver, shall contain a summary of Business’s Receiver­ship accounting including enumeration, by major categories, of total revenues and total expenditures; the net amount of any surplus or deficit with supporting facts; a declaration under penalty of perjury of the basis for the termination of Business’s Receivership; and evi­dence to support an order for the distribution of any surplus, or payment of any deficit, in the Receivership Estate. The bond of Receiver shall be canceled on this Court’s discharge of Receiver.

General Orders

IT IS FURTHER ORDERED that on the failure of Business, its agents, its representa­tives, and all persons acting under, in concert with, or on its behalf, to abide by any term or condition of this order, Receiver may petition this Court for further action to compel and enforce this order.

IT IS FURTHER ORDERED that all parties hereto, related or interested parties hereto, and all other persons and entities are hereby enjoined from interfering with Receiver’s exclu­sive conduct of Business’s Receivership.

IT IS FURTHER ORDERED that Receiver and the parties to this lawsuit may at any time apply to this Court for instructions or orders. This Court may grant any order requested by Receiver, without further notice or hearing, if no objection is filed with this Court and served on Receiver and the parties within twenty days after filing and service of Receiver’s request.

IT IS FURTHER ORDERED that no party to this lawsuit, their agents, representatives, and all persons acting under, in concert with, or on their behalf shall file a lawsuit against Receiver, or take other action against Receiver, without an order of this Court permitting the lawsuit or action; PROVIDED, HOWEVER, THAT no prior court order is required to file a motion in this action to enforce the provisions of this order or any other order of this Court in this action.

IT IS FURTHER ORDERED that Business, its agents, its representatives, and all per­sons acting under, in concert with, or on its behalf, with actual notice of this order are enjoined from in any way disturbing the Receivership Estate and from prosecuting any actions or pro­ceedings that affect the Receivership Estate, to the extent that the same would injure the Prop­erty or interfere or disturb these receivership proceedings, without permission from this Court.

IT IS FURTHER ORDERED that the Receivership Estate and its employees, agents, attorneys and all professionals and management companies retained by Receiver shall not be held liable for any claim, obligation, liability, action, cause of action, cost, expense, or debts incurred by Business. Receiver and Receiver’s employees, agents, professionals, and attor­neys shall have no personal liability and shall have no claim asserted against them relating to Receiver’s duties under this order, without prior authority from this Court as provided in this order. Nothing contained in this order shall be construed as obligating or permitting Receiver to advance Receiver’s own funds to pay any costs and expense of the Receivership Estate.

IT IS FURTHER ORDERED that [name of movant] shall indemnify, defend, and hold Receiver harmless from all suits in connection with the Receivership Estate and from all lia­bility, including for damages to property and injury or death related to the business or property of the Receivership Estate, except for liability arising out of Receiver’s willful misconduct or gross negligence that is not the result of Business’s or [name of movant]’s instruction or direc­tion.

IT IS FURTHER ORDERED that, on request made by any equity owner of Business, Receiver shall provide to that equity owner or his or her representatives, during reasonable business hours, reasonable access to, and shall permit the equity owner or his or her represen­tatives to make copies of, any records or other pertinent information reasonably necessary for the equity owner to (1) make any filings with any governmental authorities, including state and federal income tax returns for any taxable year, or (2) respond to inquiries or investiga­tions by governmental authorities or to lawsuits or other legal proceedings.

SIGNED on ________________________________.

   
JUDGE PRESIDING