Context source · GT-S-754F8088D06A
754f8088d06ad29b6fdd…0 pages · 309 KBDISTILLATES
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Exhibit C-3 – Legalist Intervention Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 1 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
ExhibitC-3 contains Legalist SPV III,LP’s intervention petition in HarrisCounty129thDistrict2024-48085,AtlanticWave/Secure vCyberlux/Schmidt. It is reproduced in TXSD4:25-cv-00626 Document1-5 filedFebruary12,2025 with unofficialclerkcopy watermark.
Exhibit C-3 – Legalist Intervention Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 1 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
Legalist describes its lending business and alleges Cyberlux loan indebtedness,Schmidt’s personal guarantee,assignment of drone-contract payments and all-assets liens. It relies on judgment creditors’ turnover application for their asserted acknowledgement of assignment. Loan,guarantee and assignment instruments themselves are not appended.
PETITION IN INTERVENTION Page 1 of 4 CAUSE NO. 2024-48085 ATLANTIC WAVE HOLDINGS, LLC AND SECURE COMMUNITY, LLC, PLAINTIFFS/JUDGMENT-CREDITORS, V. CYBERLUX CORPORATION AND MARK SCHMIDT, INDIVIDUALLY, DEFENDANTS/JUDGMENT-DEBTORS. § § § § § § § § § § § IN THE DISTRICT COURT OF 129TH JUDICIAL DISTRICT HARRIS COUNTY, TEXAS LEGALIST SPV III, LP’S PETITION IN INTERVENTION Legalist SPV III, LP (“Legalist”) hereby files its Petition in Intervention and in support thereof respectfully shows the Court as follows: I. INTRODUCTION Atlantic Wave Holdings, LLC and Secure Community, LLC (collectively, “Judgment Creditors”) filed an Application for Turnover After Judgment and For Appointment of Receiver against Cyberlux Corporation and Mark Schmidt (collectively, “Judgment Debtors”) in this proceeding in connection with a foreign judgment that Judgment Creditors obtained against Judgment Debtors. Importantly for purposes of this intervention, Legalist holds a lien on all assets belonging to Judgment Debtors. Accordingly, Legalist files this Petition in Intervention to protect its interests in the Judgment Debtors’ assets and to enforce its right to collect payment before any appointed receiver may collect fees and expenses in connection with administration of the receivership. II. RELEVANT BACKGROUND AS TO LEGALIST 1. Legalist is an investment firm that specializes in alternative assets in the private credit industry across litigation finance, bankruptcy, and government receivables lending. Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 2 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
The petition asserts $7,313,627.17 owed as ofJanuary24,2025,fees accruing$4,364.46 daily and default noticeNovember4,2024. No calculation ledger or notice service evidence accompanies those figures.
PETITION IN INTERVENTION Page 2 of 4 2. Cyberlux previously entered into a Loan Agreement with Legalist whereby Cyberlux became indebted to Legalist. Mark Schmidt personally guaranteed Cyberlux’s obligations under the Loan Agreement. 3. As the Judgement Creditors acknowledge in their Application for Turnover After Judgment and For Appointment of Receiver (“Application”), Cyberlux completed a notice of assignment to Legalist under a drone contract based on its indebtedness to Legalist, thereby giving Legalist the full right to payments from the drone contract. See Application, pp. 2-3. 4. As of January 24, 2025, Judgment Debtors are indebted to Legalist in the amount of $7,313,627.17 with fees accruing at a daily rate of $4,364.46 by virtue of their failure to satisfy their obligations under the Loan Agreement. Legalist gave Judgment Debtors notice that they are in default of payment obligations on November 4, 2024. 5. Legalist secured its position with UCC liens that secured all assets of Judgment Debtors as collateral. 6. Legalist’s UCC Financing Statement for Cyberlux is attached hereto as Exhibit A, and Legalist’s UCC Financing Statement for Mark Schmidt is attached hereto as Exhibit B. III. STANDARD FOR INTEVENTION 7. “Any party may intervene [in a case] by filing a pleading, subject to being stricken out by the court for sufficient cause on the motion of any party.” TEX. R. CIV. P. 60. An intervenor is not required to secure a court’s permission to intervene in a cause of action or establish standing. Guar. Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652, 657 (Tex. 1990). An intervenor need only show a “justiciable interest in a pending suit to intervene in the suit as a matter of right.” In re Union Carbide Corp., 273 S.W.3d 152, 154 (Tex. 2008). “A party has a justiciable interest in a lawsuit, and thus a right to intervene, when his interests will be affected by the litigation.” Jabri v. Alsayyed, 145 S.W.3d 660, 672 (Tex. App.—Houston Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 3 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
Legalist invokes TexasRule60 and justiciable property interest to intervene. It argues lien rights ordinarily outrank receivership administration costs,identifies exceptions involving lienholder instigation/acquiescence or consent/public-interest business operations,and denies the exceptions apply to itself. Those factual denials and legal conclusions remain its advocacy.
PETITION IN INTERVENTION Page 2 of 4 2. Cyberlux previously entered into a Loan Agreement with Legalist whereby Cyberlux became indebted to Legalist. Mark Schmidt personally guaranteed Cyberlux’s obligations under the Loan Agreement. 3. As the Judgement Creditors acknowledge in their Application for Turnover After Judgment and For Appointment of Receiver (“Application”), Cyberlux completed a notice of assignment to Legalist under a drone contract based on its indebtedness to Legalist, thereby giving Legalist the full right to payments from the drone contract. See Application, pp. 2-3. 4. As of January 24, 2025, Judgment Debtors are indebted to Legalist in the amount of $7,313,627.17 with fees accruing at a daily rate of $4,364.46 by virtue of their failure to satisfy their obligations under the Loan Agreement. Legalist gave Judgment Debtors notice that they are in default of payment obligations on November 4, 2024. 5. Legalist secured its position with UCC liens that secured all assets of Judgment Debtors as collateral. 6. Legalist’s UCC Financing Statement for Cyberlux is attached hereto as Exhibit A, and Legalist’s UCC Financing Statement for Mark Schmidt is attached hereto as Exhibit B. III. STANDARD FOR INTEVENTION 7. “Any party may intervene [in a case] by filing a pleading, subject to being stricken out by the court for sufficient cause on the motion of any party.” TEX. R. CIV. P. 60. An intervenor is not required to secure a court’s permission to intervene in a cause of action or establish standing. Guar. Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652, 657 (Tex. 1990). An intervenor need only show a “justiciable interest in a pending suit to intervene in the suit as a matter of right.” In re Union Carbide Corp., 273 S.W.3d 152, 154 (Tex. 2008). “A party has a justiciable interest in a lawsuit, and thus a right to intervene, when his interests will be affected by the litigation.” Jabri v. Alsayyed, 145 S.W.3d 660, 672 (Tex. App.—Houston Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 3 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
Relief requested is an express order giving Legalist full payment before receiver fees/expenses. /s/AustinN.Priddy signs for counsel,whose caption says AttorneysforLegalist,Inc.,although petitioner and UCC secured party areLegalistSPVIII,LP. Service certificate statesFebruary7,2025; this is distinct from February12 federal exhibit filing. No priority order is attached.
PETITION IN INTERVENTION Page 4 of 4 V. RELIEF REQUESTED 13. Based on the foregoing, Legalist requests that any Order Appointing Receiver or similar Order issued by this Court make clear that Legalist’s liens on Judgement Debtors’ assets take priority over the receiver’s fees and expenses, and that Legalist is entitled to payment in full from Judgment Debtors’ assets before the receiver is entitled to any fees and expenses incurred in the administration of the receivership. Respectfully submitted, VARTABEDIAN HESTER & HAYNES LLP /s/ Austin N. Priddy Austin N. Priddy Texas State Bar No. 24098284 austin.priddy@vhh.law 301 Commerce St., Ste. 3635 Fort Worth, Texas 76102 Telephone: 817.214.4985 ATTORNEYS FOR LEGALIST, INC. CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing instrument was served by the court’s efile system on all counsel of record in accordance with the Texas Rules of Civil Procedure on February 7, 2025. /s/ Austin N. Priddy Austin N. Priddy Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 5 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
ExhibitA is an NC UCC1,filing20240038686M,April1,2024 7:44PM,listing CYBERLUX CORPORATION as debtor and LegalistSPVIII,LP as secured party. Collateral is exactly Allassets. This exhibits an NC filing,not by itself the full jurisdictional perfection history or proof of attachment.
EXHIBITA.TXSD4:25-cv-00626 Document1-5 Filed02/12/25 Page6of7. File20240038686M.DateFiled4/1/2024 7:44:00PM.ElaineF.Marshall,NCSecretaryofState. Debtororganisation CYBERLUX CORPORATION,800ParkOfficesDr.,Ste.3209,ResearchTriangle,NC27709USA;individualfieldsblank. Optionalfilerreference2797 73186. Corporation Service Company filer,SPRFil ing address printed SPRFiling@cscglobal.com;acknowledgement toCorporationServiceCompany,801AdlaiStevensonDrive,SpringfieldIL62703. SecuredpartyLegalist SPV III, LP,58WestPortalAve.#747,SanFranciscoCA94127USA. Collateral:All assets. Seconddebtorallfieldsblank;nameoverflowboxesunmarked;specialcollateralTrust/Decedentboxesunmarked;PublicFinance/ManufacturedHome/TransmittingUtility/AgriculturalLien/NonUCCboxesunmarked;allalternativedesignationboxesunmarked. UCC1 Rev04/20/11 filingofficecopy. UnofficialCopyOfficeofMarilynBurgessDistrictClerk watermark.
ExhibitB is a separate NC UCC1,filing20240084460A,July15,2024 8:27AM,listing individualSCHMIDT,MARK,D. as debtor and the same secured party,Allassets collateral. Its individual debtor/date must not be merged with Cyberlux’s corporate filing.
EXHIBITB.TXSD4:25-cv-00626 Document1-5 Filed02/12/25 Page7of7. File20240084460A.DateFiled7/15/2024 8:27:00AM.ElaineF.Marshall,NCSecretaryofState. Individualdebtor surnameSCHMIDT,firstMARK,additionalD.,suffixblank;organisationblank.1134FearringtonPost,PittsboroNC27312USA. Optionalfilerreference2879 27331. Corporation Service Company filer,SPRFil ing address printed SPRFiling@cscglobal.com;acknowledgement toCorporationServiceCompany,801AdlaiStevensonDrive,SpringfieldIL62703. SecuredpartyLegalist SPV III, LP,58WestPortalAve.#747,SanFranciscoCA94127USA. Collateral:All assets. Seconddebtorallfieldsblank;nameoverflowboxesunmarked;specialcollateralTrust/Decedentboxesunmarked;PublicFinance/ManufacturedHome/TransmittingUtility/AgriculturalLien/NonUCCboxesunmarked;allalternativedesignationboxesunmarked. UCC1 Rev04/20/11 filingofficecopy. UnofficialCopyOfficeofMarilynBurgessDistrictClerk watermark.
Both financing statements identify CorporationServiceCompany as filer and acknowledgement recipient,show no second debtor and leave special-collateral/transaction/alternative-designation boxes unmarked. They contain no debtor-executed grant,amount or creditor-priority ruling.
EXHIBITA.TXSD4:25-cv-00626 Document1-5 Filed02/12/25 Page6of7. File20240038686M.DateFiled4/1/2024 7:44:00PM.ElaineF.Marshall,NCSecretaryofState. Debtororganisation CYBERLUX CORPORATION,800ParkOfficesDr.,Ste.3209,ResearchTriangle,NC27709USA;individualfieldsblank. Optionalfilerreference2797 73186. Corporation Service Company filer,SPRFil ing address printed SPRFiling@cscglobal.com;acknowledgement toCorporationServiceCompany,801AdlaiStevensonDrive,SpringfieldIL62703. SecuredpartyLegalist SPV III, LP,58WestPortalAve.#747,SanFranciscoCA94127USA. Collateral:All assets. Seconddebtorallfieldsblank;nameoverflowboxesunmarked;specialcollateralTrust/Decedentboxesunmarked;PublicFinance/ManufacturedHome/TransmittingUtility/AgriculturalLien/NonUCCboxesunmarked;allalternativedesignationboxesunmarked. UCC1 Rev04/20/11 filingofficecopy. UnofficialCopyOfficeofMarilynBurgessDistrictClerk watermark.
PETITION IN INTERVENTION Page 1 of 4 CAUSE NO. 2024-48085 ATLANTIC WAVE HOLDINGS, LLC AND SECURE COMMUNITY, LLC, PLAINTIFFS/JUDGMENT-CREDITORS, V. CYBERLUX CORPORATION AND MARK SCHMIDT, INDIVIDUALLY, DEFENDANTS/JUDGMENT-DEBTORS. § § § § § § § § § § § IN THE DISTRICT COURT OF 129TH JUDICIAL DISTRICT HARRIS COUNTY, TEXAS LEGALIST SPV III, LP’S PETITION IN INTERVENTION Legalist SPV III, LP (“Legalist”) hereby files its Petition in Intervention and in support thereof respectfully shows the Court as follows: I. INTRODUCTION Atlantic Wave Holdings, LLC and Secure Community, LLC (collectively, “Judgment Creditors”) filed an Application for Turnover After Judgment and For Appointment of Receiver against Cyberlux Corporation and Mark Schmidt (collectively, “Judgment Debtors”) in this proceeding in connection with a foreign judgment that Judgment Creditors obtained against Judgment Debtors. Importantly for purposes of this intervention, Legalist holds a lien on all assets belonging to Judgment Debtors. Accordingly, Legalist files this Petition in Intervention to protect its interests in the Judgment Debtors’ assets and to enforce its right to collect payment before any appointed receiver may collect fees and expenses in connection with administration of the receivership. II. RELEVANT BACKGROUND AS TO LEGALIST 1. Legalist is an investment firm that specializes in alternative assets in the private credit industry across litigation finance, bankruptcy, and government receivables lending. Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 2 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
PETITION IN INTERVENTION Page 2 of 4 2. Cyberlux previously entered into a Loan Agreement with Legalist whereby Cyberlux became indebted to Legalist. Mark Schmidt personally guaranteed Cyberlux’s obligations under the Loan Agreement. 3. As the Judgement Creditors acknowledge in their Application for Turnover After Judgment and For Appointment of Receiver (“Application”), Cyberlux completed a notice of assignment to Legalist under a drone contract based on its indebtedness to Legalist, thereby giving Legalist the full right to payments from the drone contract. See Application, pp. 2-3. 4. As of January 24, 2025, Judgment Debtors are indebted to Legalist in the amount of $7,313,627.17 with fees accruing at a daily rate of $4,364.46 by virtue of their failure to satisfy their obligations under the Loan Agreement. Legalist gave Judgment Debtors notice that they are in default of payment obligations on November 4, 2024. 5. Legalist secured its position with UCC liens that secured all assets of Judgment Debtors as collateral. 6. Legalist’s UCC Financing Statement for Cyberlux is attached hereto as Exhibit A, and Legalist’s UCC Financing Statement for Mark Schmidt is attached hereto as Exhibit B. III. STANDARD FOR INTEVENTION 7. “Any party may intervene [in a case] by filing a pleading, subject to being stricken out by the court for sufficient cause on the motion of any party.” TEX. R. CIV. P. 60. An intervenor is not required to secure a court’s permission to intervene in a cause of action or establish standing. Guar. Fed. Sav. Bank v. Horseshoe Operating Co., 793 S.W.2d 652, 657 (Tex. 1990). An intervenor need only show a “justiciable interest in a pending suit to intervene in the suit as a matter of right.” In re Union Carbide Corp., 273 S.W.3d 152, 154 (Tex. 2008). “A party has a justiciable interest in a lawsuit, and thus a right to intervene, when his interests will be affected by the litigation.” Jabri v. Alsayyed, 145 S.W.3d 660, 672 (Tex. App.—Houston Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 3 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
PETITION IN INTERVENTION Page 4 of 4 V. RELIEF REQUESTED 13. Based on the foregoing, Legalist requests that any Order Appointing Receiver or similar Order issued by this Court make clear that Legalist’s liens on Judgement Debtors’ assets take priority over the receiver’s fees and expenses, and that Legalist is entitled to payment in full from Judgment Debtors’ assets before the receiver is entitled to any fees and expenses incurred in the administration of the receivership. Respectfully submitted, VARTABEDIAN HESTER & HAYNES LLP /s/ Austin N. Priddy Austin N. Priddy Texas State Bar No. 24098284 austin.priddy@vhh.law 301 Commerce St., Ste. 3635 Fort Worth, Texas 76102 Telephone: 817.214.4985 ATTORNEYS FOR LEGALIST, INC. CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing instrument was served by the court’s efile system on all counsel of record in accordance with the Texas Rules of Civil Procedure on February 7, 2025. /s/ Austin N. Priddy Austin N. Priddy Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 5 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
PETITION IN INTERVENTION Page 4 of 4 V. RELIEF REQUESTED 13. Based on the foregoing, Legalist requests that any Order Appointing Receiver or similar Order issued by this Court make clear that Legalist’s liens on Judgement Debtors’ assets take priority over the receiver’s fees and expenses, and that Legalist is entitled to payment in full from Judgment Debtors’ assets before the receiver is entitled to any fees and expenses incurred in the administration of the receivership. Respectfully submitted, VARTABEDIAN HESTER & HAYNES LLP /s/ Austin N. Priddy Austin N. Priddy Texas State Bar No. 24098284 austin.priddy@vhh.law 301 Commerce St., Ste. 3635 Fort Worth, Texas 76102 Telephone: 817.214.4985 ATTORNEYS FOR LEGALIST, INC. CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing instrument was served by the court’s efile system on all counsel of record in accordance with the Texas Rules of Civil Procedure on February 7, 2025. /s/ Austin N. Priddy Austin N. Priddy Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 5 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
EXHIBITA.TXSD4:25-cv-00626 Document1-5 Filed02/12/25 Page6of7. File20240038686M.DateFiled4/1/2024 7:44:00PM.ElaineF.Marshall,NCSecretaryofState. Debtororganisation CYBERLUX CORPORATION,800ParkOfficesDr.,Ste.3209,ResearchTriangle,NC27709USA;individualfieldsblank. Optionalfilerreference2797 73186. Corporation Service Company filer,SPRFil ing address printed SPRFiling@cscglobal.com;acknowledgement toCorporationServiceCompany,801AdlaiStevensonDrive,SpringfieldIL62703. SecuredpartyLegalist SPV III, LP,58WestPortalAve.#747,SanFranciscoCA94127USA. Collateral:All assets. Seconddebtorallfieldsblank;nameoverflowboxesunmarked;specialcollateralTrust/Decedentboxesunmarked;PublicFinance/ManufacturedHome/TransmittingUtility/AgriculturalLien/NonUCCboxesunmarked;allalternativedesignationboxesunmarked. UCC1 Rev04/20/11 filingofficecopy. UnofficialCopyOfficeofMarilynBurgessDistrictClerk watermark.
PETITION IN INTERVENTION Page 4 of 4 V. RELIEF REQUESTED 13. Based on the foregoing, Legalist requests that any Order Appointing Receiver or similar Order issued by this Court make clear that Legalist’s liens on Judgement Debtors’ assets take priority over the receiver’s fees and expenses, and that Legalist is entitled to payment in full from Judgment Debtors’ assets before the receiver is entitled to any fees and expenses incurred in the administration of the receivership. Respectfully submitted, VARTABEDIAN HESTER & HAYNES LLP /s/ Austin N. Priddy Austin N. Priddy Texas State Bar No. 24098284 austin.priddy@vhh.law 301 Commerce St., Ste. 3635 Fort Worth, Texas 76102 Telephone: 817.214.4985 ATTORNEYS FOR LEGALIST, INC. CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing instrument was served by the court’s efile system on all counsel of record in accordance with the Texas Rules of Civil Procedure on February 7, 2025. /s/ Austin N. Priddy Austin N. Priddy Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 5 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
The petition documents Legalist’s contemporaneous objection to receiver-cost priority and two differently dated NC filings. It does not itself establish every element of its asserted lien, the present balance or the requested superiority over receiver charges.
Complete supplied 7-page source reviewed at SHA-256 754f8088d06ad29b6fdd33092400f7278d3f0a032360fe8d9eed8a3c03d5f10c. Source assertions, original visual features, filing/communication context and identified missing attachments are retained. Own full seven-page native text and material images2–7 read. Corporate/individual financing statements transcribed from their own images,including filing times,addresses,collateral and unmarked boxes.
Exhibit C-3 – Legalist Intervention Case 4:25-cv-00626 Document 1-5 Filed on 02/12/25 in TXSD Page 1 of 7 UnofficialCopyOfficeofMarilynBurgessDistrictClerk
What loan/guarantee/security documents,default accounting,complete filing history and receiver-priority order establish the asserted rights and balance?
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WEIGH
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