IN THE UNITED STATES BANKRUPTCY COURT
FOR THE SOUTHERN DISTRICT OF IOWA
CENTRAL DIVISION

CHAPTER 7 TRUSTEE STATUS REPORT

COMES NOW Eric W. Lain, Chapter 7 Trustee, and hereby provides the Court with the following status report:

1. Via an Order entered by this Court in May 2001, the Trustee is in the process of attempting to sell a piece of property located in Oklahoma, commonly referred to as "Falconhead." Indeed, a hearing was held before the Honorable Charles Roberts in the Circuit Court in Love County, Oklahoma in the Fall of 2001, at which hearing the Court lifted a covenant, the continued imposition of which would have prohibited the sale. A continued hearing will be held in January 2002. The gist of the litigation endeavors in Oklahoma involves an attempt by the Trustee's Oklahoma counsel to clear title. More specifically, counsel is attempting to resolve the title issues raised by the Un‑Divided Interest ("UDI") holders. Trustee's Oklahoma counsel must search voluminous records and be able to assure the Oklahoma State Court that all parties claiming an interest in the property have had sufficient notice of the sale efforts. Oklahoma counsel reports that it might take several months to complete the "title clearing" litigation. There could be as many as 800, or perhaps more than 1,000, of such UDI holders. The deed review process would therefore be extremely time consuming. The Trustee's Oklahoma counsel reports that it might take until June 2002 to procure copies of and complete the review of the various UDI deeds.

2. The Trustee's Iowa Special Counsel, Joseph A. Peiffer, is continuing his endeavors in prosecuting the remaining adversaries pending before this Court, all sounding in preferences and/or fraudulent conveyances. According to attorney Peiffer, there are probably nine targeted defendants whose litigation is yet to be resolved.

3. The Trustee's accountant, Bruce Willey of Willey, O'Brien, Beyer & Hanrahan, P.L.C. is in the process preparing the tax return that will be done in January 2002. The Trustee anticipates no delay in that endeavor.

4. Trustee's Iowa counsel is evaluating the other pending adversary cases to determine which matters should be pursued to completion.

5. In short, the only major remaining task, and indeed, the only remaining major asset yet to be ministered, involves the sale of Falconhead. Most, if not all, of the work involved in the sale would have to be performed by the Trustee's Oklahoma counsel in the Circuit Court in Love County.