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Axium Chapter 7 Trustee and hedge fund settle

May 2010

Client(s) Howard M. Ehrenberg, Chapter 7 Trustee

Jones Day, as special counsel, represented Howard M. Ehrenberg in his capacity as chapter 7 trustee of Axium International in connection with an investigation of and potential litigation regarding certain pre-bankruptcy transactions.

Prior to Axium International's chapter 7 filing in 2008, the company, and its more than 30 related debtors, comprised the third largest payroll servicing company in the entertainment industry. The pre-bankruptcy transactions between the debtors and their hedge fund lender, GoldenTree Asset Management, Inc., concluded in a cash sweep of the debtors bank accounts in early January 2008 thus precipitating the almost immediate filing of the debtors chapter 7 cases and the liquidation sale of their assets in the United States Bankruptcy Court, Central District of California. The matter was settled and the Bankruptcy Court approved the terms of the settlement in February 2010.

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