UNITED STATES BANKRUPTCY COURTNORTHERN DISTRICT OF ALABAMA DIVISIONIN RE:)CASE NO.))CHAPTER 11)Debtor.)EMERGTO USE CASH COLLATERAL BY CONSENT UNDER FED. R. BANKR. P. 4001(d) This matter is before the Court on the Emergency M(the "Debtor") for approvalof an agreement to use cash collateral. Notice of the Emergency Motion together with notice of the preliminaryhearing on the Emergency Motion has been given and served by the Debtor to (1) the Bankruptcy Administrator, (2)The District Director of the Internal Revenue Se (the "Secured Creditor") (4) any committee appointed under Section 1102 if one has beenappointed, and if not, to the twenty (20) largest unsecured creditors on the Rule 1007 (d) list. The Court consideredthe Emergency Motion; and after due de. Notice of the Emergency Motion has been given and the motion hasbeen served in accordance with Section 102(1) and Fed. R. Bankr. P. 4001(d), which notice is appropriate in theparticular circumst. Debtor filed its Petition under Chapter 11 of the Bankruptcy Code on ("the Petition Date"), and is presently operating as a Debtor in Possession in accordance with Sections 1107and 1108 of the Bankruptcy Code.(C)PRE-PETITION DEBT . The Secured Creditor is asserting a claim against Debtor in the amount of $ (the "Pre-Petition Debt"), subject to later determination (after objections, if any, by any party in interestother than the Chapter 11 Debtor in Possession) upon the filing of a properly perfected proof of claim or deemed filed under Section 1111(a) or filed by Debtor or Trustee under Rule 3004.(D)PRE-PETITION COLLATERAL . The Secured Creditor made a prima facie showing that it has aproperly perfected lien on the Debtor's property (including proceeds) at the commencement of the case and that hasa fair market value in the light of the purpose of the valuation and of the proposed disposition or use of suchproperty by the Debtor as a going concern as follows:TYPE OF COLLATERAL ESTIMATED FAIR MARKET VALUE 1. CASH COLLATERAL$ 2. INVENTORY$ 3. ACCOUNTS$ 4. OTHER COLLATERAL$ CONSTITUTING, OR WHICH MAY RESULT IN CASH COLLATERAL TOTAL$ E.CASH COLLATERAL . "Cash Collateral" as defined by Section 363(a) of the Bankruptcy Codeincludes pre-petition proceeds, products, offspring, rents, or profits of the pre-petition security interest as providedby Section 552(b) and as the term "proceeds" is described in Ala. Code. 2477-9-306.F.NECESSITY AND BEST INTEREST . The Debtor does not have sufficient unencumbered cash orother assets with which to continue to operate its business in Chapter 11. The Debtor must have immediateauthority to use cash collateral as defined herein in order to continue its business operations without interruptiontoward the objective of formulating an effective plan of reorganization for the benefit of all its creditors. Debtor's useof cash collateral to the extent and on the terms and conditions set forth herein is necessary to an effectivereorganization and in the best interest of creditors and of the Estate. The amount of cash collateral authorized to beused is only that amount necessary to avoid immediate and irreparable harm to the Estate pending a final hearing orentry of an order not to exceed $ per . There is a reasonable possibility of a successfulreorganization within a reasonable time.G.POST-PETITION COLLATERAL EQUALS PRE-PETITION COLLATERAL USED . Debtor hasmade a prima facie showing that the aggregate value of its (1) post-petition cash collateral, (2) post-petition1 "Used" being defined as resulting "in a decrease in the value of such entity's interest in such property." See Section361(2).inventory, (3) post-petition accounts, (4) other post-petition property of the Debtor constituting or which may resultin cash collateral and (5) proceeds thereof at all times shall equal or exceed the amount of pre-petition cash collateralused so that the Secured Creditor is adequately protected.H.PURPOSES . The Debtor is authorized to use the cash collateral to meet the emergency cashneeds of the Debtor, (and such other purposes as may be approved in writing by the Secured Creditor) for thepayment of actual expenses of the Debtor necessary to (a) maintain and preserve its assets, (b) continue operation ofits business, including payroll, employee expenses, and insurance expenses, and (c) pay the cost of this Chapter 11case, including professional fees and expenses, provided they are approved by the Court.The Court having determined there is a reasonable likelihood that the Debtor will prevail upon the merits atthe final hearing of the Emergency Motion as required by Section 363(c)(3), and for good cause shown, it is herebyORDERED as follows:1.USE OF CASH COLLATERAL . The Secured Creditor consents and the Debtor is authorized touse cash collateral up to the aggregate amount of $ per to pay the following expenses inaccordance with the cash collateral budget attached hereto as Exhibit "A":a. the maintenance and preservation of its assets (subject to any Section 506(c) chargeback);b. the purchase of replacement inventory; c. the continued operation of its business, including but not limited to payroll, employee expenses,and insurance;d. all administrative expenses of this Chapter 11 case, provided they are approved by the Courtupon proper notice, including Debtor's and Creditors' Committee professional fees and expenses.2.ADEQUATE PROTECTION . As adequate protection for use of the cash collateral, the SecuredCreditor is GRANTED:a. Replacement Lien . A replacement perfected security interest under Section 361(2) to the extenta Secured Creditor's cash collateral is used1 by Debtor up to the total estimated fair market value ofthe pre-petition collateral of $ (as determined in Paragraph D) and to the extentand with the same priority in Debtor's post-petition collateral, and proceeds thereof, that SecuredCreditor held in Debtor's pre-petition collateral.b. Deemed Perfected . The replacement lien granted herein is automatically deemed perfected uponentry of this order. See, Small v. Beverly Bank , 936 F.2d 945 (7th Cir. 1991). Although not required,upon request by the Secured Creditor, Debtor shall execute and deliver to the Secured Creditor anyand all UCC Financing Statements, UCC Continuation Statements, Certificates of Title or otherinstruments or documents considered by the Secured Creditor to be necessary in order to perfectthe security interest and liens granted by this Order, and the Secured Creditor is authorized toreceive, file and record the foregoing, which actions shall not be deemed a violation of theautomatic stay (but the Secured Party shall not make any further charges against Debtor therefore).c. Periodic Accountings . Debtor shall provide (monthly)(weekly) periodicaccountings by Debtor setting forth the cash receipts and disbursements made by the Debtorunder this Order. Also, copies of the Chapter 11 monthly operating reports and any other reportsreasonably required by the Secured Party shall be provided by the Debtor.d. Default Hearing . In the event Debtor defaults or violates this Order, the Secured Creditor isentitled to request a hearing within ten (10) days (or if immediate and irreparable injury, loss, ordamage, an emergency hearing within 48 hours).3.CREDITOR'S RIGHT OF INSPECTION AND AUDIT . Upon reasonable notice by the SecuredCreditor, Debtor shall permit such creditor and any of its agents reasonable and free access to the Debtor's books,records and place of business during normal business hours to verify the existence, condition and location ofcollateral in which said creditor holds a security interest and to audit Debtor's cash receipts and disbursements.4.STIPULATED AMOUNT DUE AND DULY PERFECTED FIRST LIEN . The Debtor and theSecured Creditor stipulate that the amount due the Secured Creditor is as set forth above (Paragraph C) and that theSecured Creditor holds a duly perfected security lien as of the petition date on the Debtor's (1) cash on hand, (2)inventory and (3) accounts (4) other property set forth above (Paragraph D) and (5) proceeds thereof. Thisstipulation is only binding on the Secured Creditor and Debtor.5.INTERLOCUTORY ORDER AND NO MODIFICATION OF CRED