IN RE WINTERS SHEET METAL, INC.Case No. 11-17931-PM.

In re: WINTERS SHEET METAL, INC., Chapter 11, Debtor.

United States Bankruptcy Court, D. Maryland, Greenbelt.
July 5, 2011.
WEINSTOCK FRIEDMAN & FRIEDMAN, P.A., Marc E. Shach, Esq., Fed. Bar No. 06788, Baltimore, MD, Attorney for PNC Bank, National Association.
McNAMEE HOSEA JERNIGAN KIM GREENAN & LYNCH, P.A., James M. Greenan, Esq., Leah V. Lerman, Esq., Greenbelt, MD, Attorneys for Old Line Bank.
Kimberly D. Marshall, Esquire, Waldorf, MD, Attorney for Winters Sheet Metal, Inc.

SECOND INTERIM STIPULATION AND CONSENT ORDER AUTHORIZING THE DEBTORS' USE OF CASH COLLATERAL AND GRANTING ADEQUATE PROTECTION TO PNC BANK, NATIONAL ASSOCIATION

PAUL MANNES, Bankruptcy Judge

THIS MATTER having come before the Court on the Consent Motion For Approval of Interim Stipulation and Consent Order Authorizing the Debtors' Use of Cash Collateral and Granting Adequate Protection To PNC Bank, National Association (the "Motion"), the Court, having reviewed the Motion, proper notice having been given, and it appearing that the parties have agreed to resolve all issues in dispute therein, and for good cause shown, THE PARTIES HAVING STIPULATED THAT:

A. Winters Sheet Metal, Inc. ("Winters"), Redgate Properties, LLC ("Redgate"), and Lightfoot Group, LLC ("Lightfoot") (collectively, the "Debtors") each filed a Voluntary Petition under Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code") on April 15, 2011, (the "Petition Date"). On May 4, 2011, each Debtor filed a motion seeking the joint administration of the three (3) cases.

B. The Debtors have continued in the management and operation of their businesses and property as Debtors-in-possession in accordance with 11 U.S.C. §1107 and 1108. No trustee or examiner has been appointed in these cases as of the date hereof.

C. This Court has jurisdiction over the Case, and over the property affected hereby pursuant to 28 U.S.C. § 1334. This is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A), involving matters the use of Cash Collateral under 11 U.S.C. § 363. Venue is proper in this district pursuant to 28 U.S.C. § 1408.

D. Old Line Bank ("OLB") asserts that prior to the Petition Date, Mr. James A. Winters, Sr. and Mr. William E. Winters, Jr. ("Mssrs. Winters") entered into a commercial loan transaction with Maryland Bank & Trust Company, N.A. ("MB&T") whereby MB&T advanced funds to Mssrs. Winters in the amount of $1,332,000.00, which was later modified and increased to $1,632,000.00 (the "MB&T Loan"), as evidenced by a Promissory Note, an Indemnity Modification Deed of Trust granted by Lightfoot (the "MB&T IMDOT"), an Assignment of Rents granted by Lightfoot (the "MB&T Assignment of Rents"), and a Guaranty Agreement executed by Redgate (the "MB&T Guaranty") (collectively, the "MB&T Loan Documents"). OLB is the current holder of the MB&T Loan Documents. OLB further asserts that pursuant to the MB&T Loan Documents, Lightfoot and Redgate bound themselves to pay to OLB all sums due thereunder according to the terms and conditions contained in the MB&T Loan Documents. OLB asserts a claim against Lightfoot and Redgate for the MB&T Loan in an amount in excess of $1,632,000.00 as of the Petition Date including principal interest, attorney's fees and costs as permitted by the MB&T Loan Documents.

E. PNC asserts that prior to the Petition Date, Redgate entered into two (2) commercial loan transactions with PNC Bank, National Association ("PNC") whereby PNC advanced funds to Redgate in the amounts of $320,000.00 ("Redgate Loan 1") and $290,000.00 ("Redgate Loan 2") (collectively, the "Redgate Loans"), respectively, as evidenced by Secured Notes, Deeds of Trusts, Assignments of Leases, Loan Modification Agreements, and Guaranty and Suretyship Agreement (the "Redgate Loan Documents"). PNC further asserts that pursuant to the Redgate Loan Documents, Redgate bound itself to pay to PNC all sums due thereunder according to the terms and conditions contained in the Redgate Loan Documents. PNC asserts a claim against Redgate for the Redgate Loans in the amount of $518,394.17, as of the Petition Date including interest and other charges in addition to the unpaid principal balances but exclusive of attorneys' fees which are permissible pursuant to the Redgate Loan Documents.

F. PNC and OLB assert that Redgate is a "single asset real estate" entity as defined in 11 U.S.C. § 101(51B) which Redgate contests.

G. PNC asserts the obligations of Redgate under the Redgate Loan Documents for Redgate Loan 1 are secured by: (1) Deed of Trust, dated December 12, 1996, in the amount of $320,000.00, and properly recorded in the Land Records of St. Mary's County, Maryland at Liber 1116, Folio 394, granting to PNC a lien on certain Real Property commonly known as 22100 Point Lookout Road, Leonardtown, Maryland 20650 ("Redgate Property"), and more particularly described as:

ALL THE PROPERTY, SITUATE IN ST. MARY'S COUNTY, STATE OF MARYLAND WHICH IS IDENTIFIED IN THAT CERTAIN IMPROVEMENT LOCATION AND BOUNDARY SURVEY OF DEEDS 21 180 AND 81 105 PERFORMED BY LARRY O. DAY SURVEYING, LAND PLANNING AND ENGINEERING AND RECORDED AMONG THE LAND RECORDS OF ST. MARY'S COUNTY, MARYLAND IN LIBER 41, FOLIO 38. BEING ALL AND THE SAME LAND WHICH WAS CONVEYED UNTO REDGATE PROPERTIES, L.L.C., A STATE OF MARYLAND LIMITED LIABILITY COMPANY, BY DEED DATED JANUARY 19, 1995, FROM WILLIAM WINTERS, SR., PERSONAL REPRESENTATIVE OF THE ESTATE OF DOROTHY L. WINTERS, AND WILLIAM WINTERS, SR., (COLLECTIVELY THE "GRANTORS"), AS RECORDED AMONG THE LAND RECORDS OF ST. MARY'S COUNTY, MARYLAND, AT LIBER E.W.A. NO. 1011, FOLIO 507.

and (2) a corresponding Assignments of Leases ("Redgate Assignment 1") of even date, which PNC properly perfected by filing in the Land Records of St. Mary's County, Maryland at Liber 1116, Folio 409.

H. PNC asserts that the obligations of Redgate under the Redgate Loan Documents for Redgate Loan 2 are secured by: (1) an Indemnity Mortgage executed by Lightfoot, dated May 30, 2007, in the amount of $290,000.00 and properly recorded in the Land Records of St. Mary's County, Maryland at Liber 3009 Folio 265, granting to PNC a lien on certain Real Property commonly known as 43660 Pump House Lane, 43860 Web Lane, and Point Lookout Road, Leonardtown, Maryland 20650 ("Lightfoot Property"), and more particularly described as:

PARCEL ONE Tax Map 49, Parcel 224 Deed Description for 6.126 Acres of land, more or less Second Election District, St. Mary's County, Maryland Beginning at a point set on the northerly right of way line of Maryland Route 5, a 160 foot right of way per SRC Plats 13292 and 13293, said point also being the southeasterly corner of that parcel of land now or formerly owned by Walton Lumber Company as recorded in liber CBG 12 folio 236 among the land records of St. Mary's County, Maryland, thence, leaving the right of way lines of Maryland Route 5 and running with the lands of Walton Lumber Company, 1) N 03 16 40 E 833.19 feet to a point set at the southwesterly corner of that tract of land now or formerly owned by James A. Winters, Sr. As recorded in liber EWA 938 folio 57 among the aforesaid land records, thence, leaving the lands of Walton Lumber Company and running with the lands of James A. Winters, Sr. 2) S 60 04 33 E 548.30 feet to a point set at the northwesterly corner of that parcel of land now of formerly owned by William E. Winters, Sr. as recorded in liber EWA 101 1 folio 504 among the aforesaid land records, thence, leaving the lands of James A. Winters, Sr. and running with the lands of William E. Winters, Sr. 3) S 29 57 15 W 701 .98 feet to a point marked by a concrete monument found, thence, 4) N 82 45 54 W 1 10.95 feet to a point set on the northerly right of way lines of the aforementioned Maryland Route 5, thence, leaving the lands of William E. Winters, Sr. and running with the right of way lines of Maryland Route 5, 5) N 60 00 51 W 71 .89 feet to the point of beginning. Containing 6.126 Acres of land, more or less. Subject to any and all rights of way and/or easements of record. PARCEL TWO Tax Map 49, Parcel 66 Deed Description for 16.037 Acres of land, more or less Second Election District, St. Mary's County, Maryland Beginning at a point set on the northerly right of way line of Maryland Route 5, a 160 foot right of way per SRC Plats 13292 and 13293, said point also being the southwesterly corner of that parcel of land now or formerly owned by Redgate Properties LLC as recorded in liber EWA 1011 folio 507 among the land records of St. Mary's County, Maryland, thence, leaving the lands of Redgate Properties LLC and running with the northerly right of way lines of Maryland Route 5, 6) N 59 40 50 W 1297.31 feet to a point set at the southeasterly corner of that parcel of land now or formerly owned by William E. Winters, Sr. as recorded in Liber EWA 1011 folio 504 among the aforesaid land records, thence, leaving the right of way lines of Maryland Route 5 and running with the lands of William E. Winters, Sr., 7) S 82 45 54 E 1 10.95 feet to a point marked by a concrete monument found, thence, 8) N 29 57 15 E 701 .98 feet to a point set on the southerly lines of that tract of land now or formerly owned by James A. Winters, Sr. as recorded in liber EWA 938 folio 57 among the aforesaid land records, thence, leaving the lands of William E. Winters, Sr. and running with the lands of James A. Winters, Sr., 9) S 60 04 33 E 665.04 feet to a point marked by concrete monument found, thence, 10) S 05 13 48 E 400.36 feet to a point marked by an iron pipe found at the northwesterly corner of that parcel of land now or formerly owned by William E. Winters as recorded in liber EWA 1011 folio 504 among the aforesaid land records, said course and distance leaving the lands of William E. Winters, Sr., 11) S 05 1 1 10 E 241 .58 feet to a point set at the northwesterly corner of the aforesaid Redgate Properties LLC property, thence, leaving the lands of William E. Winters, Sr., and running with the lands of Redgate Properties LLC, 12) S 05 03 06 E 279.19 feet to the point of beginning. Containing 16.037 Acres of land, more or less. Subject to any and all rights of way and/or easements of record. PARCEL THREE Tax Map 50, Parcel 132 Deed Description for 83.423 Acres of land, more or less Second Election District, St. Mary's County, Maryland Beginning at a point marked by a cedar post found in the westerly lines of that tract of land now or formerly owned by Edward Pussler as recorded in liber EWA 1768 folio 622 among the lands records of St. Mary's County, Maryland, said point also being on the northerly lines of that tract of land now or formerly owned by William E. Winters, Jr. as recorded in liber MRB 18 folio 499 among the aforesaid land records, thence, leaving the lands Edward Pussler and running with the lands of William E. Winters, Jr. and the lands of James A. Winters, Sr. as recorded in liber EWA 938 folio 57 among the aforesaid land records, 13) N 82 52 35 W 2027.64 feet to a point set on the easterly lines of that tract of land now or formerly owned by Walton Lumber Company as recorded in liber CBG 12 folio 236, thence, leaving the land of James A Winters, Sr. and running with the lands of Walton Lumber Company, 14) N 36 57 45 E 103.29 feet to a point, thence, 15) N 40 13 32 E 118.88 feet to a point, thence, 16) N 04 40 17 E 177.27 feet to a point, thence, 17) S 76 25 30 E 102.09 feet to a point, thence, 18) N 56 22 38 E 131 .31 feet to a point, thence, 19) N 69 44 10 E 19.02 feet to a point, thence, 20) N 25 03 09 E 129.11 feet to a point, thence, 21) N 56 46 07 E 68.83 feet to a point, thence, 22) N 03-09-00 W 58.74 feet to a point, thence, 23) N 14 21 45 E 147.16 feet to a point, thence, 24) N 41 55 13 E 85.43 feet to a point, thence, 25) S 67 08 39 E 35.80 feet to a point, thence, 26) N 65 20 55 E 82.75 feet to a point, thence, 27) N 34 28 21 E 83.20 feet to a point, thence, 28) N 46 47 19 E 38.22 feet to a point, thence, 29) N 12 42 46 W 42.32 feet to a point, thence, 30 N 58 09 03 E 109.81 feet to a point, thence, 31) N 44 03 57 E 41.94 feet to a point, thence, 32) N 73 39 34 E 88.64 feet to a point, thence, 33) N 34 01 35 E 117.42 feet to a point, thence, 34) N 11 37 56 E 40.16 feet to a point, thence, 35) N 39 11 11 E 63.39 feet to a point, thence, 36) N 40 22 35 E 59.99 feet to a point, thence, 37) N 29 25 22 E 308.09 feet to a point, thence, 38) N 29 01 26 E 207.83 feet to a point, thence, 39) N 07 22 28 E 159.34 feet to a point, thence, 40) N 43 42 16 E 30.63 feet to a point, thence, 41) N 06 11 45 E 80.05 feet to a point set on the southerly lines of that parcel of land now or formerly owned by The Board of County Commissioners of St. Mary's County, Maryland as recorded in liber MRB 19 at folio 352, thence, leaving the lands of Walton Lumber Company and running with the lands of The Board of County Commissioners of St. Mary's County, Maryland, 42) S 64 11 47 E 258.54 feet to a point marked by an iron pipe found on the southwesterly lines of that tract of land now or formerly owned by the State of Maryland, Department of Natural Resources as recorded in liber DBK 214 at folio 238 among the aforesaid land records, thence, leaving the lands of The Board of County Commissioners of St. Mary's County, Maryland and running with the lands of the State of Maryland, Department of Natural Resources, 43) S 33 49 1 1 E 239.32 feet to a point marked by an iron pipe found, thence, 44) S 77 00 00 E 181 .98 feet to a point marked by an iron pipe found, thence, 45) N 56 51 33 E 592.62 feet to a point marked by an iron pipe found, thence, 46) S 75 50 24 E 720.92 feet to a point, thence, 47) S 07 29 43 W 550.04 feet to a point marked by a stone found at the northeasterly corner of the aforesaid lands of Edward Pussler, thence, leaving the lands of the State of Maryland, Department of Natural Resources and running with the lands of Edward Pussler, 48) S 54 32 10 W 1266.63 feet to a point marked by a stone found, thence, 49) S 00 01 36 E 802.32 feet to the point of beginning. Containing 83.423 Acres of land, more or less. Subject to any and all rights of way and/or easements of record. PARCEL FOUR Tax Map 50, Parcel 252 Deed Description for 3.446 Acres of land, more or less Second Election District, St. Mary's County, Maryland Beginning at a point marked by an iron pipe found at the northwesterly corner of Lot 3, Deer Hills Subdivision as recorded in Plat Book 33 page 43 among the plat records of St. Mary's County, Maryland, said point also being the northeasterly corner of that parcel of land now or formerly owned by William E. Winters, Sr., as recorded in liber EWA 1011 folio 504 among the land records of St. Mary's County, Maryland, thence, leaving the outlines of Lot 3, Deer Hills Subdivision and running with the lands of William E. Winters, Sr. 50) N 82 46 02 W 643.68 feet to a point marked by an iron pipe found, thence, 51) N 05 13 48 W 245.30 feet to a point set on the westerly side of a 50 foot right-of way as shown on a plat entitled "Mitchum Meadows" as recorded in Plat Book 19 page 27 among the aforesaid plat records, thence, leaving the lands of William E. Winters, Sr. and running with the outlines of the 50 foot right of way and Lot 1 of the aforesaid Mitchum Meadows, 52) S 82 46 29 E 609.41 feet to a point set on the westerly outlines of Lot 1 of the aforesaid Deer Hills Subdivision, thence, leaving Lot 1, Mitchum Meadows and running with Lot 1, Deer Hills Subdivision, 53) S 12 46 01 E 254.97 feet to the point of beginning. Containing 3.446 Acres of land, more or less. Subject to any and all rights of way and/or easements of record.

(the Redgate Property and the Lightfoot Property shall collectively be known as the "Properties") and (2) a corresponding Assignments of Leases of even date ("Lightfoot Assignment") which PNC asserts is properly perfected by filing in the Land Records of St. Mary's County, Maryland at Liber 3009, Folio 278 as recorded May 31, 2007.

I. PNC and OLB assert that Lightfoot is a "single asset real estate" entity as defined in 11 U.S.C. § 101(51B), which Lightfoot contests.

J. PNC asserts that prior to the Petition Date, PNC lent the sum of $250,000.00 to Winters, which was modified and increased to the sum of $550,000.00 on March 12, 2007 and to the sum of $850,000.00 on August 13, 2008 (the "Winters Loan"). The Winters Loan is evidenced by a Secured Note, Security Agreement, Indemnity Mortgage, Business Loan Agreement, Change In Terms Agreement, Modification of Mortgage, Amendment to Loan Documents, and a Guaranty and Suretyship Agreement (the "Winters Loan Documents"). PNC asserts that pursuant to the Winters Loan Documents, Winters bound itself to pay to PNC all sums due thereunder according to the terms and conditions contained in the Winters Loan Documents. PNC asserts a claim against Winters for the Winters Loan in the amount of $797,274.41, as of the Petition Date including interest and other charges in addition to the unpaid principal balances but exclusive of attorneys' fees which are permissible pursuant to the Winters Loan Documents.

K. PNC asserts the obligations of Winters under the Winters Loan Documents are secured by (1) a Security Agreement, dated February 16, 2003 granting to PNC a lien on "All of the Debtor's inventory, accounts, general intangibles," etc., as more fully described therein, properly perfected by filing with the Maryland State Department of Assessments and Taxation as Instrument No. 181169051, filed October 20, 2003 (the "Security Agreement"); (2) an Indemnity Mortgage containing an assignment of rents ("Redgate Assignment 2"), dated May 30, 2007, executed by Redgate, in the amount of $250,000.00, and properly recorded in the Land Records of St. Mary's County, Maryland at Liber 2898, Folio 318, granting to PNC a lien on the Redgate Property; (3) an Indemnity Mortgage Modification Agreement increasing the amount of the mortgage to $550,000.00, properly perfected by filing in the Land Records of St. Mary's County, Maryland at Liber 2964, Folio 723; (4) a Modification of Mortgage dated August 13, 2008, increasing the amount of the mortgage to $850,000.00, properly perfected by filing in the Land Records of St. Mary's County, Maryland at Liber 3199 Folio 173; and (5) Real Estate Documents Modification Agreement dated June 8, 2010 and recorded in the Land Records of St. Mary's County at Liber 3448 Folio 356.

L. The liens, as granted in the Security Agreement, Redgate Assignment 1, Redgate Assignment 2, the Lightfoot Assignment, and the MB&T Assignment of Rents (collectively, Redgate Assignment 1, Redgate Assignment 2 the Lightfoot Assignment, and the MB&T Assignment of Rents shall be known as the "Assignments"), as detailed above, constitute an alleged lien on "Cash Collateral" as defined by 11 U.S.C. § 363(a).

M. The Debtors lack sufficient unencumbered cash or other assets with which to continue to operate their businesses in Chapter 11. The Debtors require continued authority to use Cash Collateral pending a final hearing or entry of a final order to continue to operate their businesses without interruption toward the objective of formulating an effective plan of reorganization.

N The Debtors have each provided detailed budgets, setting forth an itemization of each Debtor's monthly cash needs for the period from the Petition Date through June 30, 2011 (the "Interim Budgets").

O. The Debtors, creditors and parties-in-interest shall have the absolute right to challenge or dispute the existence, extent, validity, and perfection of each lien and Assignment set forth above in accordance with this paragraph. The Debtors, creditors and parties-in-interest shall have ninety (90) days from June 8, 2011, to commence such challenge or dispute. Should said parties fail to contest such liens and Assignments in the ninety (90) day period set forth herein, such liens and Assignments shall deemed valid and perfected, subject to the rights of any potential Official Committee of Unsecured Creditors, as set forth below. Should any Official Committee of Unsecured Creditors be appointed in any of these Cases, any such Committee shall have forty-five (45) days from the date of their appointment to contest the validity or perfection of any of the liens or Assignments set forth above. Should any such Committee fail to contest such liens and Assignments in the ninety (90) day period set forth herein, or should no such Committee be appointed within one hundred twenty (120) days of June 8, 2011, such liens and Assignments shall deemed valid and perfected. IT IS HEREBY ADJUDGED AND ORDERED BY THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF MARYLAND THAT:

1. Relief Granted. As to Winters, the Motion is hereby GRANTED, subject to the terms and conditions of this Preliminary Stipulation and Consent Order Authorizing the Debtors' Use of Cash Collateral and Granting Adequate Protection To PNC Bank, National Association (the "Order").

2. Possession of Property. Winters shall retain possession of its property and may use its property in the ordinary course of business.

3. Use of Cash Collateral. PNC consents, and Winters is authorized, for the period beginning nunc pro tunc to the Petition Date and ending on July 31, 2011, to use Winters' Cash Collateral in the ordinary course of their business, and to meet Winters' ordinary cash needs, in accordance with the Interim Budget(s), up to the aggregate amount of the Interim Budget(s) for (a) the maintenance and preservation of Winters' assets; (b) the continued operation of Winters' businesses, including but not limited to payroll, payroll taxes, employee expenses, and insurance costs; and (c) the purchase of replacement supplies and inventory. By consenting to the use of Cash Collateral in accordance with this Order and the Interim Budget, PNC is not agreeing to a carve out in any amount in favor of those parties listed in the Interim Budget, other than a carve out for US Trustee fees. Nothing in this paragraph shall prejudice the rights of the Debtors to seek further or different carve outs in further orders allowing use of cash collateral upon proper notice to PNC, OLB and any party requesting notice.

4. Adequate Protection. As adequate protection for Winters' use of the Winters' Cash Collateral, from and after the Petition Date, and any diminution of the value of the Winters' Cash Collateral arising on account of Winters use thereof, PNC is GRANTED:

a. Replacement Lien.

A continuing, valid, binding, enforceable perfected post-petition security interest under 11 U.S.C. § 361(2), nunc pro tunc to the Petition Date, in and to all assets (except avoidance actions) of Winters, as defined in the Loan Documents, and the proceeds of the foregoing, but limited to the same type of assets and to the same extent and priority as existed prepetition. The validity, perfection and priority of such replacement lien shall not be affected by the automatic stay of 11 U.S.C. § 362(a) or subject to the "equities of the case" exception of 11 U.S.C. § 552(b)(1) and (2). The replacement lien granted herein shall be subject to and subordinate to an administrative "Carve-Out," for statutory fees payable to the United States Trustee pursuant to the 11 U.S.C. § 506(c), without prejudice for Debtors' counsel to seek a carve out and the right of PNC to object thereto. However, nothing in this paragraph shall prejudice the rights and interests of OLB with respect to further orders allowing use of cash collateral.

b. Payment.

In addition to the security interests, liens, and other protections granted herein, Winters shall pay to PNC the sum of $3,500.00 by July 20, 2011 (the "Adequate Protection Payment"). The Adequate Protection Payment shall be applied by PNC to reduce the outstanding indebtedness owed by Winters to PNC. Time is of the essence. The amount of the Adequate Protection Payment set for above is not an admission by PNC, OLB or Winters that such amounts are adequate in any future orders regarding the use of Cash Collateral or adequate protection.

c. Deemed Perfected.

Subject to Paragraph O above, the replacement lien and security interest granted herein is automatically deemed perfected upon entry of this Order without the necessity of PNC taking possession, filing financing statements, mortgages or other documents, pursuant to 11 U.S.C. § 552. Although not required, upon request by PNC, the Debtors shall execute and deliver to PNC any and all UCC Financing Statements, UCC Continuation Statements, Certificates of Title or other instruments or documents considered by PNC to be necessary in order to perfect the security interests and liens in the Winters post-petition collateral and proceeds granted by this Order, and PNC is authorized to receive, file and record the foregoing, which actions shall not be deemed a violation of the automatic stay. However, nothing in this paragraph shall prejudice the rights and interest of OLB with respect to further orders allowing use of cash collateral.

d. Statutory Rights under 11 U.S.C. § 507(b).

To the extent the adequate protection provided for hereby proves insufficient to protect PNC's interest in and to the Cash Collateral, PNC shall have a super-priority administrative expense claim, pursuant to 11 U.S.C. § 507(b), senior to any and all claims against Winters under 11 U.S.C. § 507(a), whether in this proceeding or in any superseding proceeding, which shall be limited to the amount of Cash Collateral actually used. However, nothing in this paragraph shall prejudice the rights and interests of OLB with respect to further orders allowing use of cash collateral.

e. Periodic Accountings.

Winters shall remain current in the filing of their monthly operating reports, which reports shall be available to PNC through the Court's EM/ECF system. Upon PNC's or OLB's reasonable request, the Winters will provide additional detailed information pertaining to items contained in the reports.

f. Creditor's Rights of Inspection and Audit.

Upon reasonable notice by PNC or OLB and at PNC's or OLB's expense, Winters shall permit PNC, and any of its agents, and OLB, and any of its agents, reasonable and free access to the Winters' records and place of business during normal business hours to: (a) verify the existence, condition and location of collateral in which said creditor holds a security interest; (b) to conduct an appraisal(s) of any such collateral; (c) to inspect, audit and make copies of the Winters' books and records; and (d) to conduct environmental testing with respect to the Debtors' real property. In conjunction therewith, Winters shall not be entitled to seek reimbursement from PNC or OLB for incidental expenses such as time expended by Debtors, rent, or similar other expenses. Winters shall deposit all Cash Collateral into a Debtor-In-Possession bank account(s) in the name of Winters, as Debtors-in-Possession or such other account(s) as is authorized by an Order of the Bankruptcy Court on notice to creditors and the United States Trustee.

g. Insurance.

Winters shall at all times maintain insurance in the form and to the extent required under the Loan Documents or as may be further required by PNC to properly protect its collateral, and provide proof of said insurance to PNC and OLB within twenty-one (21) days of the entry of the Order by providing certificates of insurance. Those certificates of insurance shall list, where applicable, PNC and OLB as a loss payee and a recipient of notice in the event of cancellation.

h. Taxes.

Winters shall remain current in paying all employment taxes, sales taxes and real estate taxes due and payable by Winters for the periods after the Petition Date and otherwise to comply with the requirements of a debtor-in-possession.

5. Events of Default.

Failure to make the Adequate Protection Payment when due, shall be deemed to be a "Monetary Default". In the event of a Monetary Default, Winters shall be given a five (5) calendar day period to cure such Monetary Default. Such right to cure shall only apply to the first Monetary Default. Winters shall not be entitled to cure any subsequent Monetary Default under this Order or any future Order regarding the use of Cash Collateral or Adequate Protection. The failure of Winters to comply with any of the terms of this Order other than those set forth in Paragraph 4b above shall be deemed to be a "Non-Monetary Default". In the event of any Non-Monetary Default, Winters shall have five (5) calendar days from notice of such Non-Monetary Default to cure such Non-Monetary Default. Should Winters fail to cure any Monetary or Non-Monetary Default as set forth above, Winters shall immediately cease use of the Cash Collateral without further order of this Court.

6. Expedited Hearing.

Should an event of default occur as set forth above, or Winters otherwise violate this Order, PNC and/or OLB is entitled to request a hearing within ten (10) days on a Motion for Relief from the Automatic Stay or to Prohibit Use of Cash Collateral (or if immediate and irreparable injury, loss or damage may occur, an emergency hearing within 48 hours).

7. Expiration of Authority to Use Cash Collateral.

Irrespective of whether Winters defaults under or violate this Order, this Order will automatically expire on July 31, 2011, unless it is extended with the written consent of PNC (which consent may be withheld in PNC's sole discretion) or the approval of the Bankruptcy Court. Time is of the essence. However, nothing in this paragraph shall prejudice the rights or interests of OLB with respect to further orders allowing use of cash collateral.

8. No Effect on Creditor's Rights against Non-Debtors and Non-Estate Property.

Nothing contained herein shall be deemed or construed to limit PNC's or OLB's rights against any non-bankrupt co-borrower or guarantor of Winters or with respect to any property that is not property of the Winters estate.

9. Interlocutory Order and No Modification of Creditor's Adequate Protection.

This is an interlocutory order. Nothing contained herein shall be deemed or construed to: (a) limit PNC or OLB to the relief granted herein; (b) bar PNC or OLB from seeking other and further relief (including without limitation relief from the terms of this Order) for cause shown on appropriate notice to the Debtors and other parties-in-interest entitled to notice of same; (c) require PNC or OLB to make any further loans or advances to the Debtors; (d) constitute a waiver of any default under the Loan Documents or the reinstatement of any Loan Document. The Order may be modified for cause shown by the Debtors, PNC, OLB or any other party-in-interest on due notice. No such modification, however, shall deprive PNC or OLB of its interest in Debtors' property (pre-petition and post-petition).

10. Reservation of Rights.

Nothing in this Order shall be deemed to preclude OLB from contesting the validity, extent or priority of the liens asserted by PNC or that some or all of the cash collateral of Winters belongs to OLB. It is the intent of the preceding sentence that all rights are reserved to all parties in connection with the issue of priority of liens and Assignments and whether the cash collateral belongs in whole or in part to PNC.

11. Based on the facts of this case the notice requirements of Federal Rule of Bankruptcy Procedure 4001 are deemed to be complied with or otherwise waived. A subsequent/final hearing on the use of Cash Collateral shall be held on July 21, 2011 at the United States Bankruptcy Court, Federal Courthouse, 6500 Cherrywood Lane, Courtroom 3-D, Greenbelt, Maryland 20770 at 10:30 AM.

SO ORDERED.


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