AGREED ORDER ON DEBTOR’S AMENDED EMERGENCY MOTION TO USE CASH COLLATERAL
05/31/2007 53 Agreed Order Granting in Part Debtor's Amended Emergency Motion to Use Cash Collateral and Agreed Order Setting Final Hearing on this matter. (RE: related document(s)22 Motion for Use of Cash Collateral, filed by Debtor Pro Mold, Inc.). Hearing scheduled for 6/7/2007 at 01:30 PM at Lexington Courtroom, 3rd Floor. (baa) (Entered: 05/31/2007)
------------------------
Doc 53
In Re: Case No. 07-50935
Judge William S. Howard
PRO MOLD, INC.,
Chapter 11 Debtor.
AGREED ORDER ON DEBTOR’S AMENDED EMERGENCY MOTION TO USE CASH COLLATERAL
On the 22nd day of May 2007 came on to be heard the Debtor’s Emergency Motion to Use Cash Collateral and Amended Emergency Motion to Use Cash Collateral (“Motion”) filed pursuant to 11 U.S.C. Section 363 and Federal Rule of Bankruptcy Procedure 4001 by Debtor Pro Mold, Inc. and the Objection to Debtor’s Emergency Motion to Use Cash Collateral (“Objection”) filed by the John P. Murphy, III Revocable Trust No. 1; Pro Plas, LLC, a Missouri limited liability company; 10315, LLC, a Missouri limited liability company; and John P. Murphy, III (collectively “the Murphy Entities”). The parties received notice as required by law of the filing of the Motion and the Objection and the hearing thereon.
Further, the Court finds as follows:
1. The Court has jurisdiction in regard to this matter pursuant to 28 U.S.C. Sections 157 and 1334 and the Local Rules for the United States District Court for the Eastern District of Kentucky.
2. This matter is a core proceeding under 28 U.S. C. Section 157(b)(2)(D).
3. On or about May 16, 2007 Debtor Pro Mold, Inc. (“Debtor Pro Mold”) filed its Voluntary Chapter 11 Petition for Relief in the United States Bankruptcy Court for the Eastern District of Kentucky, Lexington Division, and continues to operate its business and manage its financial affairs pursuant to Sections 1107 and 1108 of the Bankruptcy Code.
4. On May 17, 2007, Debtor Pro Mold filed its Motion for Expedited Hearing on First Day Motions and its Emergency Motion to Use Cash Collateral.
5. On May 21, 2007, the Murphy Entities filed their Objection to Debtor’s Emergency Motion to Use Cash Collateral.
6. On May 21, 2007, Debtor Pro Mold filed Debtor’s Amended Emergency Motion to Use Cash Collateral.
7. On May 22, 2007, the Court heard and granted the Debtor’s Motion for Expedited Hearing on First Day Motions.
8. On May 22, 2007 the Court heard the Debtor’s Emergency Motion to Use Cash Collateral and the Murphy Entities Objection to Debtor’s Amended Emergency Motion to Use Cash Collateral.
9. The parties agreed that one or more of the Murphy Entities have a security interest in the following:
a. all of Debtor Pro Mold’s personal property including but not limited to the Debtor’s accounts receivable, equipment, inventory, and general intangibles, whether now owned or hereafter acquired, and the proceeds thereof;
b. Debtor Pro Mold’s leasehold interest in the real property located at 10315 Page Industrial Blvd., St. Louis, Missouri 63132; and
c. Stock Certificate No. 4, representing one thousand shares (1,000) shares of common stock of Pro Mold, Inc. as described in the Stock Pledge Agreement dated April 30, 2006, with an effective date of December 31, 2005 executed by Borrower Plasticon International, Inc.
10. The parties did not agree on the amount due and owing by Debtor Pro Mold and/or Debtor Plasticon International Inc. (“Debtor Plasticon”).
11. The parties did not agree on the value of the cash collateral.
12. The parties did not agree on the existence of an equity cushion.
13. The Murphy Entities did not consent to the Debtor’s emergency or interim use of the cash collateral pursuant to 11 U.S.C. §363(c)(2)(A).
14. The Court, after notice and a hearing, authorized the Debtor’s emergency or interim use of cash collateral pursuant to 11 U.S.C. § 363(c)(2)(B) pursuant to the Pro Mold, Inc. Budget for Next 30 Days as of May 17, 2007 (“Interim Budget”) to prevent interruption in the operations of Debtor Pro Mold’s business pending a final hearing on the Debtor’s use of the Murphy Entities’ cash collateral.
15. The Murphy Entities requested that the Court condition or prohibit Debtor Pro Mold’s emergency or interim use of cash collateral in order to provide the Murphy Entities with the necessary adequate protection of their interest in the cash collateral pursuant to 11 U.S.C. §363(e).
16. Debtor Pro Mold again asserted that the Murphy Entities’ interest in the cash collateral was adequately protected by an equity cushion.
17. In their Objection to Debtor Pro Mold’s Motion, the Murphy Entities requested the following in order to determine if an equity cushion actually exists and in order to establish the validity of Debtor Pro Mold’s Interim Budget and Debtor Pro Mold’s projections therein:
a. Debtor Pro Mold’s check register(s) from January 1, 2007 to the date of the filing of the case and since the filing of the case;
b. Debtor Pro Mold’s General Ledger from January 1, 2007 to the date of the filing of the case and since the filing of the case;
c. Proof of insurance on the cash collateral;
d. The last two tax returns filed by Debtor Pro Mold with the Federal Government and the State of Missouri; and
e. Access to the cash collateral upon giving 48 hours written notice to Debtor Pro Mold’s attorney to inspect and appraise it.
18. At the hearing on Debtor Pro Mold’s Motion, the Murphy Entities requested additional financial information in order to determine if an equity cushion actually exists and in order to establish the validity of Debtor Pro Mold’s Interim Budget and Debtor Pro Mold’s projections therein.
19. The Court directed that access be provided to the Murphy Entities to inspect and appraise the collateral and that financial information be furnished sufficient to determine if an equity cushion actually exists and in order to establish the validity of Debtor Pro Mold’s Interim Budget and Debtor Pro Mold’s projections therein.
20. The Court conditioned Debtor Pro Mold’s use of cash collateral upon the Murphy Entities being granted access by Debtor Pro Mold to the collateral to inspect and appraise it and receiving financial information sufficient to determine if an equity cushion actually exists and in order to establish the validity of the Debtor Pro Mold’s Interim Budget and the Debtor’s projections therein.
21. The Murphy Entities requested that the Court order the Debtor and/or Debtor Plasticon to escrow the $125,000 payment that was due to Creditor Pro Plas on April 1, 2007 and all future principal and interest payments due on the $1,000,000 Promissory Note pending further Order of the Court.
22. The Court did not rule on the Murphy Entities’ request in regard to the $1,000,000 Promissory Note.
23. The Murphy Entities requested and Debtor Pro Mold and Debtor Plasticon agreed that Debtor Pro Mold and/or Debtor Plasticon would timely make all other postpetition payments due to the Murphy Entities pending further Order of the Court.
24. The final hearing on the Debtor’s Amended Motion to Use Cash Collateral will be held on June 7, 2007 at 1:30 p.m. EDT.
25. The Murphy Entities reserved the right to assert additional objections and to request additional adequate protection prior to the final hearing on the Debtor’s Amended Motion to Use Cash Collateral.
IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that
A. the Debtor’s Amended Emergency Motion to Use Cash Collateral shall be and is hereby granted in part and denied in part.
B. the factual findings in this Order are incorporated herein by this reference.
C. the Murphy Entities have a security interest in the following collateral and cash collateral:
1. all of Debtor Pro Mold’s personal property including but not limited to Debtor Pro Mold’s accounts receivable, equipment, inventory, and general intangibles, whether now owned or hereafter acquired, and the proceeds thereto;
2. Debtor Pro Mold’s leasehold interest in the real property located at 10315 Page Industrial Blvd., St. Louis, Missouri 63132; and
3. Stock Certificate No. 4, representing one thousand shares (1,000) shares of common stock of Pro Mold, Inc. as described in the Stock Pledge Agreement dated April 30, 2006, with an effective date of December 31, 2005 executed by Borrower Plasticon International, Inc.
D. Debtor Pro Mold’s emergency or interim use of cash collateral as detailed in the Debtor Pro Mold’s Interim Budget that is attached hereto shall be and is hereby authorized pursuant to 11 U.S.C. §363(c)(2)(B) to prevent interruption in the operations of Debtor Pro Mold’s business pending a final hearing on the Debtor’s use of cash collateral.
E. Debtor shall not make any expenditures or incur any obligations relating to nonbudgeted items including capital improvements, without the prior written approval of the Murphy Entities, unless the Court orders otherwise with notice to the Murphy Entities and an opportunity to object.
F. Debtor Pro Mold’s emergency or interim use of the cash collateral shall be and is hereby conditioned upon Debtor Pro Mold’s compliance with the Interim Budget incorporated herein by reference and the following pursuant to 11 U.S.C. §363(e):
a. The Murphy Entities being granted access by Debtor Pro Mold to the collateral upon giving 48 hours written notice to the Debtor’s attorney to inspect and appraise it.
b. The Murphy Entities receiving the following financial information on or before June 1, 2007:
1. Debtor Pro Mold’s check register(s) from January 1, 2007 to the date of the filing of the case and since the filing of the case;
2. Debtor Pro Mold’s General Ledger from January 1, 2007 to the date of the filing of the case and since the filing of the case;
3. Proof of Insurance on the collateral;
4. The last two tax returns filed by the Debtor with the Federal Government and the State of Missouri, which will be provided on a confidential basis, but such tax returns may be used in any proceedings in this case and may be filed with the Court under seal;
5. Disbursements Journal – which includes detailed information on any disbursements not specifically disclosed in any other reports required herein;
6. Receipts Journal - – which includes detailed information on any receipts not specifically disclosed in any other reports required herein;
7. Accounts Payable Aging Detailed;
8. Accounts Receivable Aging Detailed;
9. General Ledger Monthly;
10. Sales Journal with general information as to all customers and specific information on related company sales;
11. General Journal Entries; and
12. ADP Payroll Report for Pro Mold and Plasticon
c. Debtor shall maintain at all times a policy of casualty insurance in effect on all personal property, including but not limited to equipment and inventory, for an amount at least equal to $1,000,000 naming the Murphy Entities as loss payee.
G. The Court did not rule on the Murphy Entities request in regard to the $1,000,000 Promissory Note and shall reserve this matter for the final hearing on Debtor Pro Mold’s Motion to Use Cash Collateral.
H. Debtor Pro Mold shall timely make all other post-petition payments due to the Murphy Entities pending further Order of the Court.
I. The final hearing on Debtor Pro Mold’s Amended Motion to Use Cash Collateral shall be heard on June 7, 2007 at 1:30 p.m. EDT.
J. The Murphy Entities shall be and are hereby authorized to assert additional objections and to request additional adequate protection prior to the final hearing on Debtor Pro Mold’s Motion to Use Cash Collateral.
STONE, LEYTON & GERSHMAN
A Professional Corporation
By: /s/ E. Rebecca Case
E. Rebecca Case, EDMO #2800
Howard S. Smotkin, EDMO #4407
7733 Forsyth Boulevard, Suite 500
St. Louis, Missouri 63105
(314) 721-7011
(314) 721-8660 Facsimile
erc@stoneleyton.com
hss@stoneleyton.com
Attorneys for John P. Murphy III Revocable Trust No. 1; Pro Plas, LLC; 10315, LLC, and John P. Murphy, III, individually
GREENEBAUM DOLL & MCDONALD PLCC
By: /s/ Gregory R. Schaaf
John W. Ames
Gregory R. Schaaf
300 W. Vine Street, Suite 1100
Lexington, KY 40507
(859) 288-4629
(859) 367-3877 (facsimile)
e-mail: grs@gdm.com
Local Counsel for John P. Murphy III Revocable Trust No. 1; Pro Plas, LLC; 10315, LLC, and John P. Murphy, III, individually
WYATT, TARRANT & COMBS, LLP
By: /s/ Robert J. Brown
Robert J. Brown
John P. Brice
250 West Main Street, Suite 1600
Lexington, Kentucky 40507-1746
(859) 233-2012
(859) 259-0649 Facsimile
lexbankruptcy@wyattfirm.com
Attorneys for Debtor Pro Mold, Inc.
Pursuant to Local Rule 9022-1(c), counsel for the Debtors shall cause a copy of this Order to be served on the parties that are entitled to service pursuant to the notice procedures order entered in this case pursuant to Local Rule 9022-1(a) and shall file with the Court a certificate of service of the Order upon the parties within ten (10) days hereof.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The affixing of this Court's electronic seal below is proof this document has been signed by the Judge and electronically entered by the Clerk in the official record of this case.
Signed By:
William S. Howard
Bankruptcy Judge
Dated: Thursday, May 31, 2007
(wsh)
----------------
Extract from attached image file:
PRO MOLD INC,
BUDGET FOR NEXT 30 DAYS
AS OF MAY 17, 2007
----
SALARIES, WAGES AND BENEFITS
SALARIES AND WAGES..........113,000
PAYROL TAXES..................9,920
401(K)PLAN CONTRIBUTIONS......1,000
GROUP INSURANCE...............4,810
TOTAL SALARIES AND BENEFITS 128,730 |
