SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* LAVINE JONATHAN S (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111 HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol Encompass Group Affiliates, Inc [ ECGA ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) Other (specify below)
	3. Date of Earliest Transaction (Month/Day/Year) 02/01/2010
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Warrants to Purchase Common Stock	$0.01	02/01/2010		J(3)		2,475,950,511(4)		02/01/2010	06/01/2011	Common Stock	2,475,950,511(4)	$0(3)	2,475,950,511(4)	I	By entities named in footnotes(1)(2)

1. Name and Address of Reporting Person* LAVINE JONATHAN S (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111 HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SANKATY CREDIT OPPORTUNITIES III LP (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Sankaty Credit Opportunities Investors III, LLC (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SANKATY CREDIT MEMBER, LLC (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* SANKATY CREDIT OPPORTUNITIES II LP (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111 HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* Sankaty Credit Opportunities Investors II, LLC (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* PROSPECT HARBOR CREDIT PARTNERS LP (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

1. Name and Address of Reporting Person* PROSPECT HARBOR INVESTORS, LLC (Last) (First) (Middle) C/O SANKATY ADVISORS, LLC 111, HUNTINGTON AVENUE (Street) BOSTON MA 02111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) Other (specify below)

Explanation of Responses:

1. The securities reported as indirectly beneficially owned by the Reporting Person are directly beneficially owned by (i) Sankaty Credit Opportunities III, L.P. (which securities may also be deemed to be indirectly beneficially owned by Sankaty Credit Opportunities Investors III, LLC, as general partner of Sankaty Credit Opportunities III, L.P.); (ii) Sankaty Credit Opportunities II, L.P. (which securities may also be deemed to be indirectly beneficially owned by Sankaty Credit opportunities Investors II, LLC, as general partner of Sankaty Credit Opportunities II, L.P.); and (iii) Prospect Harbor Credit Partners, L.P. (which securities may also be deemed to be indirectly beneficially owned by Prospect Harbor Investors, LLC, as general partner of Prospect Harbor Credit Partners, L.P.)

2. The securities reported as indirectly beneficially owned by the Reporting Person may also be deemed to be indirectly beneficially owned by Sankaty Credit Member, LLC, as managing member of each of Sankaty Credit Opportunities Investors III, LLC, Sankaty Credit Opportunities Investors II, LLC and Prospect Harbor Investors, LLC. The Reporting Person is the managing member of Sankaty Credit Member, LLC. Pursuant to Instruction 4(b)(iv) of Form 4, each beneficial owner named herein has elected to report ownership of the entire number of securities owned by Sankaty Credit Opportunities III, L.P., Sankaty Credit Opportunities II, L.P. and Prospect Harbor Credit Partners, L.P., however each of them, including the Reporting Person, disclaims beneficial ownership of any securities, except to the extent of their pecuniary interest therein.

3. Pursuant to the terms of an Amended and Restated Note Purchase Agreement dated as of August 1, 2008 among the Issuer and the purchasers named therein, including the Reporting Persons, due to the existence of certain circumstances relating to the Notes purchased hereunder and to the Issuer as of February 1, 2010, the Note Purchasers received the Warrants, for no additional consideration, in amounts based on a certain percentages of the Common Stock issued and outstanding on a fully diluted basis.

4. Includes 1,705,434,711 shares issuable upon exercise of warrants held by Sankaty Credit Opportunities III, L.P., 511,778,971 shares issuable upon exercise of warrants held by Sankaty Credit Opportunities II, L.P. and 258,736,829 shares issuable upon exercise of warrants held by Prospect Harbor Credit Partners, L.P.

Remarks:

The Reporting Persons are 10% Owners of the Issuer when percentage ownership is calculated in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, which requires that calculations be made for a stockholder assuming that such stockholder has converted its convertible securities but that no other stockholder has converted its convertible securities. The Issuer in its filings has taken a different approach to calculating percentage ownership, assuming full conversion of all outstanding securities convertible into Common Stock, pursuant to which the Reporting Person is not a 10% Owner.

	/s/ Jonathan S. Lavine, individually and as managing member of Sankaty Credit Member, LLC, managing member of Sankaty Credit Opportunities Investors III, LLC, general partner of Sankaty Credit Opportunities III, L.P.	06/22/2010
	/s/ Jonathan S. Lavine, as managing member of Sankaty Credit Member, LLC, managing member of Sankaty Credit Opportunities Investors II, LLC, general partner of Sankaty Credit Opportunities II, L.P.	06/22/2010
	/s/ Jonathan S. Lavine, as managing member of Sankaty Credit Member, LLC, managing member of Prospect Harbor Investors, LLC, general partner of Prospect Harbor Credit Partners, L.P.	06/22/2010
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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