Legal
Wildwood Casino

Plainfield Discounted Debt Sale Challenged by American Gaming Group Investors

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Investors in a Colorado casino are claiming they were cheated out of their equity control in a scheme involving Innovation Capital and the asset managers brought in to lend the company money during its start-up phase. The deal involved a $51 million senior secured credit facility funded by Guggenheim Partners and millions of subordinated debt funded by now defunct Plainfield Asset Management to build a gambling complex in Cripple Creek, Colo., called Wildwood Casino. A group of majority equity investors led by John Schaffer filed an arbitration claim against the casino manager, Joe Canfora of Merit Management, for contract violations after he bought the casino’s subordinated debt from Plainfield Asset Management (PFAM) at a deep discount without notifying other investors of the investment opportunity. Part of the PFAM loan structure involved warrants for class A shares that Canfora now owns. When executed the warrants give Canfora majority ownership over the initial investors.

Legal
Eco Building

Eco Building Settles Alpha Capital Suit

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PIPE issuer Eco Building Products (ECOB) settled a suit filed by Alpha Capital Anstalt, which alleged Eco Building failed to pay off a debenture on its Nov. 13 due date last year. The suit also alleged Eco Building improperly issued stock to a third party to which Alpha assigned its interest in the debenture. Alpha has invested over $75 million in 128 stock and debt PIPEs since 2006. It is managed by LH Financial, which has put $292 million into 547 deals since 2003.

Deals

Grandparents.com Raises Cash with Convertible PIPE

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Grandparents.com (GPCM) announced that it has agreed to a $3.5 million Convertible Secured Promissory Notes transaction. The fixed conversion price of the Convertible Secured Promissory Notes, the Placement Agent, and the Investors were not disclosed. The transaction closed on Dec. 7, 2012. This Placement funded in tranches.

Deals

Computer Vision Systems PIPE Follows Reverse Merger

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Computer Vision Systems Laboratories Corp. (CVSL) announced that it has raised $20 million in a Convertible Notes transaction with investor Richmont Capital Partners V.

The company recently formed through a reverse merger according to a regulatory filing. The fixed conversion price of the Convertible Notes is $0.33 per share, an approximate 94.12% premium to the market price ($0.17) of CVSL at deal announcement. The Investor is owned by a director of the Company. Upon conversion of the Notes the Company's largest shareholder, Rochon Capital Partners Ltd., a Company owned by the same director of the Company, will surrender the common stock necessary for the Company to convert the Notes to ensure no dilution occurs.