UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF LOUISIANA LAFAYETTE DIVISION CHAPTER 11

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1 UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF LOUISIANA LAFAYETTE DIVISION IN RE: A&B VALVE AND PIPING SYSTEMS, L.L.C., et al., DEBTORS CASE NO (JOINT ADMINISTRATION REQUESTED) 1 CHAPTER 11 CHIEF JUDGE ROBERT SUMMERHAYS MOTION FOR ENTRY OF AN ORDER TO (A) TO PAY ALL OUTSTANDING PRE- PETITION WAGES, SALARIES, OTHER ACCRUED COMPENSATION, EXPENSE REIMBURSEMENTS, BENEFITS, AND RELATED AMOUNTS; AND (B) CONTINUE SPECIFIED BENEFIT PROGRAMS IN THE ORDINARY COURSE OF BUSINESS NOW INTO COURT, through undersigned counsel, come the debtors-in-possession, A&B Valve and Piping Systems, L.L.C. ( A&B ); Kimzey Casing Service, LLC ( KCS ); Sheffield GP, LLC ( GP ); and Sheffield Holdings, LP ( Sheffield ) (collectively, the Debtors ), who move for authorization (A) to pay all outstanding pre-petition wages, salaries, other accrued compensation, expense reimbursement, benefits, and related amounts, and (B) continue specified benefit programs in the ordinary course of business (this Motion ). In support, the Debtors represent: Jurisdiction and Venue 1. This Court as jurisdiction over this matter pursuant to 28 U.S.C. 157 and This is a core proceeding pursuant to 28 U.S.C. 157(b). Venue is proper before this Court pursuant to 28 U.S.C and The Debtors have concurrently filed a Motion for Order Under Bankruptcy Rule 1015(b) Directing Joint Administration of Chapter 11 Cases seeking the joint administration of the cases of Kimzey Casing Service, LLC ( ); Sheffield Holdings, LLC ( ); and Sheffield GP, LP ( ) with A&B Valve and Piping Systems, LLC ( ) #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 1 of 16

2 2. The statutory bases for the relief requested herein are sections 105(a), 363(b), 507(a)(4), 507(a)(5) and 1114(e) of title 11 of the United States Code 11 U.S.C. 101, et seq. (the Bankruptcy Code ). Background 3. On October 16, 2015 (the Petition Date ), the Debtors filed for relief under chapter 11 of the Bankruptcy Code. The Debtors are operating their businesses and managing their properties as debtors-in-possession pursuant to Bankruptcy Code 1107 and No trustee or examiner has been appointed, and no official committee of creditors has yet been established. 4. This Court is referred to the Declaration of Ryan A. Maupin (the Declaration ) (ECF Doc. 3) for a detailed discussion of the factual background and circumstances surrounding the Debtors' commencement of these chapter 11 cases. 2 Relief Requested 5. The Debtors seek authorization, pursuant to Bankruptcy Code 105(a), 363(b), and 507(a)(4), and Bankruptcy Rules 6003 and 6004, to (i) pay their current employees (the Employees ) for work performed pre-petition, (ii) honor certain other prepetition employeerelated obligations and benefits, (iii) continue paying its employee obligations, and (iv) continue administering its employee programs and plans in the ordinary course of the Debtors businesses. 6. The Debtors seek this authorization to minimize the personal hardship that the Employees would suffer if they are not paid when due and to maintain the morale of their essential workforce at this critical time. The Employee Obligations include: Wage Obligations, Payroll Taxes, Employee Expense Reimbursement Obligations, and Employee Benefit 2 Allc a pita lize d te rm snotspe c ific a llyd e fine d he re in sha llha ve the m e a ning a sc rib e d tosuc h te rm sin the De c la ra tion #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 2 of 16

3 Obligations (each as defined below, and collectively, the Employee Obligations ), and all fees and costs incident to the foregoing, including amounts owed to third-party administrators. 7. In addition, the Debtors seek authorization for the Debtors banks (the Banks ) to receive, process, honor and pay any and all checks, electronic fund transfers, and automatic payroll transfers drawn on the Debtors payroll and/or general disbursement accounts (collectively, the Disbursement Accounts ), to the extent that such checks or transfers relate to any of the prepetition Employee Obligations. Wage Obligations 8. Prior to the Petition Date and in the ordinary course of business, the Debtors typically paid obligations relating to wages, salary, and compensation for all of their Employees (the Wage Obligations ) through payroll checks and direct deposits into the Employee s bank accounts. 9. The Debtors have an approximate current work force of full-time Employees as follows: A&B KCS GP Sheffield Hourly Wage Employees Salaried Employees Insiders All A&B and KCS employees are paid every two weeks in arrears. A full time employee will receive 26 pay periods in a year. Payrolls are staggered such that A&B 3 The Debtors do not request relief related to insiders in this Motion. Similar relief for Insider Employees of the Debtor is requested in a separate motion filed concurrently herewith #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 3 of 16

4 employees 4 and KCS employees 5 receive paychecks on alternating weeks. In the ordinary course of business, A&B Employees are paid on Thursdays of their respective pay period and KCS Employees are paid on Fridays of their respective pay period. A&B and KCS must pay FICA, FUTA, SUTA and withholding taxes related to employee payroll as required by federal, state and/or local authorities. 11. The gross amount of A&B s monthly payroll (excluding insiders) is approximately $291,776 with A&B s share of payroll taxes estimated to be $23,028. The gross amount of KCS s monthly payroll (excluding insiders) is approximately $255,288 with KCS s share of payroll taxes estimated to be $18,961. A&B and KCS distribute payroll checks and direct deposits to Employees up to five (5) days after the close of the applicable pay period. Accordingly, the Employee Obligations for the wages and salaries of the Employees for the period from the close of the applicable pay period through the Petition Date may remain outstanding as pre-petition claims. A&B and KCS estimate that the pre-petition payroll owed on the Petition Date is $292,000. Employee Expense Reimbursement Obligations 12. The Debtors reimburse their Employees who incur and pay a variety of approved business-related expenses, in the ordinary course of performing their duties ( Employee Expense Reimbursement Obligations ). Most Employees initially incur and pay such expenses by using corporate or personal credit cards. Employees who use their personal credit card are subsequently reimbursed after submission and approval of expense reimbursement requests. 4 A&B payroll is processed by Total HR and A&B uses Total HR as its third-party payroll administrator. A&B payroll taxes are drafted directly by the taxing authorities against A&B s Disbursement Account at PNC Bank. These payroll tax payments are paid at varying intervals (weekly and quarterly). 5 KCS payroll is processed in-house and KCS uses AMCheck as its third-party payroll administrator. KCS pays all wages, payroll taxes and withholdings to AMCheck who disburses all payments #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 4 of 16

5 Employees who use a corporate credit card do not need to submit a reimbursement request since corporate card obligations are directly paid by the Debtors. 13. Because a significant lag time may occur between the time such expenses are incurred and the time an expense reimbursement request is submitted, it is difficult to determine with precision the aggregate outstanding amount of such Employee Expense Reimbursement Obligations. However, in the event pre-petition Employee Expense Reimbursement Obligations may be due and owing, the Debtors request approval to pay such obligations. A&B and KCS estimate that the Employee Expense Reimbursement Obligations owed on the Petition Date is $8, It would be patently inequitable to require Employees to personally bear any expenses that they incurred in furtherance of their responsibilities to the Debtors. Accordingly, the Debtors request authority, in their discretion and in the exercise of their business judgment, to continue to honor all of the Employee Expense Reimbursement Obligations in the ordinary course of business, regardless of when such obligations arose. Employee Benefits 15. The Debtors have established various plans and policies to provide full-time Employees with various medical, dental, prescription drug, vision, life insurance, retirement savings, and other benefits (collectively, the Employee Benefits, and amounts owed under these plans, the Employee Benefit Obligations ). 16. The Debtors provide eligible Employees with insurance for life, short term and long term disability, accident and dismemberment, vision, dental, health, and workers compensation #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 5 of 16

6 17. The Debtors medical plan is self-funded and administered by Group & Pension Administrators ( GPA ). The Debtors maintain a stop loss policy with United States Fire Insurance Company which provides a $50,000 cap per member. The Debtors vision and dental benefits are provided by Cigna Health and Life Insurance Company. Premiums relating to the medical, and dental plans are funded through Employee contributions and partially with contributions from the Debtors. Premiums related to vision plans are fully paid by Employee contributions. Disbursements on account of the medical claims are paid to Ventanex (a payment processing company) on a weekly basis via an ACH (which is initiated by Ventanex) and drawn against the A&B Disbursement account. 6 Premiums related to vision, and dental plans are paid on the 1st of every month. Approximately $93,364 7 is disbursed each month to GPA in connection with the medical plan, and approximately $3,401 and $1,317 is disbursed each month for A&B and KCS, respectively, to Cigna Vision and Dental in connection with the vision and dental plans. 18. The Debtors life insurance plans and disability (short-term and long-term) 8 insurance plans are provided by Life Insurance Company of North America (a Cigna company) and Accident Insurance Company, respectively. Premiums relating to the Debtors life insurance plans are fully funded by the Debtors with individual death benefits for all eligible full time employees equal to a year s salary up to a maximum of $200,000. Premiums relating to the Debtors disability (short-term and long-term) insurance plans are funded through Employee contributions. Payment of premiums on account of the Debtors life insurance plans and 6 The draw covers claims for both A&B and KCS employees. Claim expenses for KCS are charged via an intercompany account. 7 Note that this figure is for both A&B and KCS and includes amounts paid for company insiders. 8 Supplemental disability and life insurance through Colonial Life and Accident Insurance Company is available to all tenured A&B employees and is offered to all KCS employees irrespective of tenure #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 6 of 16

7 disability (short-term and long-term) insurance plans are made in the middle of every month. Approximately $5,522 and $4,650 is disbursed each month for A&B and KCS, respectively, to Cigna Life Insurance and Colonial Life in connection with the Debtors life insurance and disability plans A&B provides workers compensation insurance for its Employees at the statutorily-required level for each state it operates in through a policy provided by Commerce and Industry Insurance Company (an AIG company). Commerce and Industry Insurance Company administers and pays the Debtors workers compensation claims. Annual A&B worker s compensation insurance premiums and fees are paid through a down payment of approximately 35% with the remaining premium and fees financed through seven monthly payments with Prime Rate Premium Finance Corporation, Inc.. A&B workers compensation premiums are approximately $96,197 for the yearly policy period. 20. KCS provides workers compensation insurance for its Employees at the statutorily-required level for each state it operates in through self-insurance claims payments made by KCS for the first $15,000 of each claim and by insurance policies provided by The Rockwood Company ( Rockwood ) and Imperium Insurance Company ( Imperium ) to cover claim amounts in excess of $15,000. Rockwood and Imperium administer and pay the KCS workers compensation claims. KCS workers compensation insurance premiums, fees and actual monthly claims are paid directly by KCS up to established limits. KSC workers compensation costs are estimated to be approximately $444,120 for the yearly policy period. 21. By this Motion, the Debtors request authority to continue to make payments related to the policy so that their workers compensation programs are not interrupted. 9 Note that this figures include amounts paid for company insiders #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 7 of 16

8 22. A&B provides monthly car and cell phone allowances to certain sales and store management Employees. Nine non-insider A&B Employees receive car allowances at a monthly cost of approximately $6,350. Eight non-insider A&B Employees receive phone allowances at a monthly cost of approximately $ The Debtors also allow their Employees for certain other leaves of absence for personal reasons, many of which are required by law ( Leaves of Absence ). Leaves of Absence include family medical leaves, pregnancy, adoption and foster care leaves, military leaves, jury duty, voting leaves, personal leaves and bereavement leaves and the Debtors intend to pay any accrued Leaves of Absences in the ordinary course of business. 24. The Debtors maintain a retirement savings plan meeting the requirements of Section 401(k) of the Internal Revenue Code for the benefit of eligible Employees (the 401(k) Plan ). Full-Time Employees who are over the age of 21 and who have completed ninety (90) days of employment are eligible to be enrolled in the 401(k) Plan (the Participants ). The 401(k) Plan allows for automatic pre-tax salary deductions of eligible compensation up to the limits set by the Internal Revenue Code. The 401(k) Plan is provided by John Hancock Life and administered by July Business Services, Inc. Approximately 15 non-insider A&B Employees and 44 non-insider KCS Employees currently participate in the 401(k) Plan, and the approximate monthly amount withheld from the A&B and KCS participants paychecks for 401(k) contributions is $4,914 and $2,510, respectively One (1) insider participates in the 401(k) Plan in addition to these Employees. This insider makes monthly contributions of $ #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 8 of 16

9 Payroll Taxes 25. During each pay period, the Debtors withhold deductions from Employees direct deposits for obligations such as state income taxes, federal income taxes, social security, and Medicare contributions (collectively, the Payroll Tax Deductions ), and subsequently the Debtors remit the withholdings to the relevant governmental authorities. The Debtors also pay payroll taxes pursuant to the Federal Insurance Contributions Act ( FICA ), and federal and state unemployment taxes (collectively, the Payroll Tax Payments and, together with the Payroll Tax Deductions, the Payroll Taxes ). Other Withholding Obligations 26. Frequently, the Debtors are presented with garnishment or child support orders requiring the withholding of Employee wages to satisfy such Employee obligations. Payments of these obligations are made from amounts otherwise payable to the Employees and are not an incremental cost obligation of the Debtors estates. The Debtors seek authority to continue making such deductions and to pay over such amounts to third parties as requested or required. Basis Relief Requested 27. Pursuant to Bankruptcy Code 507(a)(4)(A) and 507(a)(4)(B), claims of employees of the debtors for wages, salaries, or commissions, including vacation, severance, and sick leave pay earned within 180 days before the Commencement Date are afforded priority unsecured status to the extent of $11,725 per employee. Similarly, Bankruptcy Code 507(a)(5) provides that employees claims for contributions to certain employee benefit plans also are afforded priority unsecured status to the extent of $11,725 per employee covered by such plan, less any amount paid pursuant to Bankruptcy Code 507(a)(4) #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 9 of 16

10 28. The Debtors believe that most of the Employee Obligations relating to the period prior to the Petition Date constitute priority claims under Bankruptcy Code 507(a)(4) and (5). As priority claims, the Employee Obligations must be paid in full before any general unsecured obligations of the Debtors may be satisfied. Accordingly, the relief requested may affect only the timing of the payment of these priority obligations and will not prejudice the rights of general unsecured creditors or other parties in interest. 29. Bankruptcy Code 105(a) of the Bankruptcy Code empowers the Court to issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title. Moreover, Bankruptcy Code 363(b)(1) of the Bankruptcy Code provides [t]he trustee, after notice and a hearing, may use, sell, or lease, other than in the ordinary course of business, property of the estate. 30. A bankruptcy court s use of its equitable powers to authorize the payment of prepetition debt when such payment is needed to facilitate the rehabilitation of the debtor is not a novel concept. In re Ionosphere Clubs, Inc., 98 B.R. 174, 175 (Bankr. S.D.N.Y. 1989). Courts have recognized the applicability of the necessity of payment doctrine with respect to the payment of prepetition employee compensation and benefits. See, e.g., In re CoServ, L.L.C., 273 B.R. 487, 494 (Bankr. N.D. Tex. 2002) (noting that wage claims typically are payable out of necessity as well as by virtue of their priority ); In re Chateaugay Corp., 80 B.R. 279, (S.D.N.Y. 1987), appeal dismissed 838 F.2d 59 (2d Cir. 1988) (approving lower court order authorizing payment of prepetition wages, salaries, expenses, and benefits). This doctrine is consistent with the paramount goal of chapter 11 of facilitating the continued operation and rehabilitation of the debtor. Ionosphere Clubs, 98 B.R. at 176. The Debtors submit that application of the necessity of payment doctrine is wholly warranted in this Case #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 10 of 16

11 31. Accordingly, this Court has authority pursuant to 11 U.S.C. 105(a) to authorize the payment of pre-petition wage and benefit claims. See, e.g. In re Idearc, Inc., 423 B.R. 138, (Bankr. N.D. Tex. 2009) subsequently aff d sub nom, In re Idearc, Inc., 662 F.3d 315 (5th Cir. 2011) (finding that the employees should be paid for vacation time in accordance with pre-petition benefit plan); In re Tusa-Expo Holdings, Inc., , 2008 WL , *2 (Bankr. N.D. Tex. Nov. 7, 2008) (noting the importance of entitlement to priority treatment in deciding whether a pre-petition unsecured claim may be paid at the initial stages of a chapter 11 case); In re Gulf Air, Inc., 112 B.R. 152 (Bankr. W.D. La. 1989) (authorizing payment of prepetition amounts due for wages, benefits, and health insurance premiums). 32. In In re Tusa-Expo, the United States Bankruptcy Court for the Northern District of Texas noted that satisfying employees pre-petition claims was essential because, among other reasons, absent paying these claims there would be significant turnover which would interrupt the continuity of the debtor s business. In addition, the court went on to note that even if an employee remains with a debtor despite nonpayment of prepetition wages and benefits, the employee s work would be affected as the employee would likely be preoccupied with his or her personal economic issues which would obstruct the employee s performance of work. Likewise here, the Debtors simply cannot risk the substantial damage to their businesses that would inevitably attend a rapid decline in Employee morale. 33. Numerous bankruptcy courts, including this Court, have recognized the importance of paying employees pre-petition claims and authorized payment of pre-petition employee compensation and benefits as appropriate under Bankruptcy Code 105(a). See, e.g., In re Port Aggregates, Inc., (Bankr. W.D. La. Dec. 19, 2014); In re Bass, Ltd., (Bankr. W.D. La. Oct. 20, 2011); In re T & M Aviation, Inc., (Bankr. W.D. La #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 11 of 16

12 Oct. 6, 2010). See also In re Pilgrim's Pride Corp., (Bankr. N.D. Tex. Dec. 02, 2008); In re Tusa-Expo Holdings, Inc., (Bankr. N.D. Tex. Nov. 7, 2008). 34. In this case, any delay or failure to pay wages, salaries, benefits, and other similar items would irreparably impair the Employees morale, dedication, confidence, and cooperation, and would adversely affect the Debtors relationship with their employees at a time when the support of the Employees is critical to the Debtors reorganization efforts. 35. Absent an order granting the relief requested herein, the Employees will suffer undue hardship and, in many instances, serious financial difficulties, as the Employees need the amounts in question to meet their own personal financial obligations. Without the requested relief, the stability of the Debtors will be undermined, perhaps irreparably, by the distinct possibility that otherwise loyal Employees will seek other employment alternatives. In addition, it would be inequitable to require the Employees to bear personally the cost of any business expenses they incurred prepetition, for the benefit of the Debtors, with the understanding that they would be reimbursed. 36. With respect to Payroll Taxes in particular, the payment of such taxes will not prejudice other creditors of the Debtors estates, as the relevant taxing authorities generally would hold priority claims under Bankruptcy Code 507(a)(8) in respect of such obligations. Moreover, the portion of the Payroll Taxes withheld from an Employee s wages on behalf of the applicable taxing authority is held in trust by the Debtors. As such, these Payroll Taxes are not property of the Debtors estates under Bankruptcy Code 541. See Begier v. IRS, 496 US 53 (1990) (withholding taxes are property held by a debtor in trust for another and, as such, are not property of the debtor's estate) #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 12 of 16

13 37. The Debtors do not seek to alter their compensation, vacation, or other benefit policies at this time. This Motion is intended only to permit the Debtors, in their discretion, to make payments consistent with the Debtors existing policies to the extent that, without the benefit of an order approving this Motion, such payments may be inconsistent with the relevant provisions of the Bankruptcy Code, and to permit the Debtors, in their discretion, to continue to honor their practices, programs, and policies with respect to its Employees, as such practices, programs, and policies were in effect as of the Petition Date. Payment of all Employee Obligations in accordance with the Debtors pre-petition business practices is in the best interests of the Debtors estates, their creditors, and all parties-in-interest and will enable the Debtors to continue to operate their businesses in an economic and efficient manner without disruption. The Employees are central to the Debtors operations and are vital to these cases. A significant deterioration in employee morale at this critical time undoubtedly would have a devastating impact on the Debtors, their customers and vendors, the value of the Debtors assets and business, and the Debtors ability to continue operations. 38. The Debtors further request that the Court authorize and direct the Banks to receive, process, and pay any and all checks, electronic fund transfers, and automatic payroll transfers drawn on the Debtors Disbursement Accounts, to the extent that such checks or transfers relate to any of the pre-petition Employee Obligations. The Debtors also seek authority to issue new post-petition checks, or effect new electronic fund transfers, on account of such claims to replace any pre-petition checks or electronic fund transfer requests that may be dishonored or rejected as a result of the commencement of the bankruptcy cases #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 13 of 16

14 The Debtors Satisfy Bankruptcy Rule The Debtors submit that the facts cited herein and in the Declaration illustrate that the relief requested is necessary to avoid immediate and irreparable harm to the Debtors and their estates. Based on the foregoing, Bankruptcy Rule 6003 has been satisfied. Waiver of Bankruptcy Rules 6004(a) and (h) 40. To implement the foregoing successfully, the Debtors seek a waiver of the notice requirements under Bankruptcy Rule 6004(a) and the fourteen-day stay of an order authorizing the use, sale, or lease of property under Bankruptcy Rule 6004(h). Reservation of Rights 41. Nothing contained herein is intended or shall be construed as (i) an admission as to the validity of any claim against the Debtors, (ii) a waiver of the Debtors or any party in interest s rights to dispute any claim, or (iii) an approval or assumption of any agreement, contract, program, policy or lease under Bankruptcy Code 365. Likewise, if this Court grants the relief sought herein, any payment made pursuant to the Court s order is not intended and should not be construed as an admission to the validity of any claim or a waiver of the Debtors rights to dispute such claim subsequently. Notice 42. Notice of this Motion has been given to all parties on the Special Notice List, including, without limitation: (i) the Office of the United States Trustee; (ii) the Debtors and their counsel; (iii) PNC Bank, National Association; (iv) 3K Partners, Ltd.; (v) Community Bank; (vi) Toyota Motor Credit; (vii) the twenty (20) largest unsecured creditors of A&B Valve and Piping Systems, L.L.C.; Kimzey Casing Service, LLC; Sheffield GP, LLC; and Sheffield Holdings, LP; and (viii) governmental agencies having a regulatory or statutory interest in these #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 14 of 16

15 cases. In light of the nature of the relief requested herein, the Company submits that no other or further notice is necessary. No Prior Application 43. No previous application for the relief sought herein has been made to this or to any other court. WHEREFORE, the Debtors respectfully request the entry of an Order substantially in the form attached hereto as EXHIBIT A granting the relief requested herein, and granting such other relief as this Court may deem appropriate and just. Respectfully submitted, GORDON, ARATA, MCCOLLAM, DUPLANTIS & EAGAN, LLC By: _/s/ Louis M. Phillips Louis M. Phillips (La. Bar No ) Peter A. Kopfinger (La. Bar No ) One American Place 301 Main Street, Suite 1600 Baton Rouge, LA Telephone: (225) Facsimile: (225) lphillips@gordonarata.com pkopfinger@gordonarata.com AND Armistead M. Long (La. Bar No ) 400 East Kaliste Saloom Road, Suite 4200 Lafayette, Louisiana along@gordonarata.com Phone: (337) Fax: (337) AND #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 15 of 16

16 Patrick Rick M. Shelby (La. Bar No ) 201 St. Charles Avenue, 40 th Floor New Orleans, Louisiana Telephone: (504) Proposed Attorneys for A&B Valve and Piping Systems, L.L.C.; Kimzey Casing Service, LLC; Sheffield GP, LLC; and Sheffield Holdings, LP #6 File 10/17/15 Enter 10/17/15 12:31:18 Main Document Pg 16 of 16

17 UNITED STATES BANKRUPTCY COURT WESTERN DISTRICT OF LOUISIANA LAFAYETTE DIVISION IN RE: A&B VALVE AND PIPING SYSTEMS, L.L.C., et al., 1 DEBTORS CASE NO (JOINTLY ADMINISTERED) CHAPTER 11 CHIEF JUDGE ROBERT SUMMERHAYS ORDER AUTHORIZING (A) PAYMENT OF ALL OUTSTANDING PRE-PETITION WAGES, SALARIES, OTHER ACCRUED COMPENSATION, EXPENSE REIMBURSEMENTS, BENEFITS, AND RELATED AMOUNT; AND (B) CONTINUATION OF SPECIFIED BENEFIT PROGRAMS IN THE ORDINARY COURSE OF BUSINESS CONSIDERING the motion of the debtors-in-possession, A&B Valve and Piping Systems, L.L.C.; Kimzey Casing Service, LLC; Sheffield GP, LLC; and Sheffield Holdings, LP (collectively the Debtors ) for the entry of an Order authorizing the Debtors to (a) to pay all 1 Kimzey Casing Service, LLC ( ); Sheffield GP, LLC ( ); and Sheffield Holdings, LP ( ) are being jointly administered with A&B Valve and Piping Systems, LLC ( ) pursuant to a court order (EFC No. ) entered on October, #6-1 File 10/17/15 Enter 10/17/15 12:31:18 Proposed Order Pg 1 of 4

18 outstanding pre-petition wages, salaries, other accrued compensation, expense reimbursements, benefits, and related amount; and (b) continue specified benefit programs in the ordinary course of business (the Motion ) 2 (ECF Doc. 6), the record of this case, applicable law, and for reasons orally assigned in open Court and on the record at the hearing on the Motion on October 19, 2015: IT IS ORDERED that the Debtors be and hereby are authorized, pursuant to Bankruptcy Code 105(a) and 363(b), but is not obligated or directed, in the reasonable exercise of its business judgment, to pay and honor amounts on account of Employee Obligations including, but not limited to all wages, compensation, vacation, and expense reimbursements, and to continue all Employee Benefits in the ordinary course of business; IT IS FURTHER ORDERED that all applicable Banks are authorized and directed, when requested by the Debtors and in the Debtors sole discretion, to receive, process, honor, and pay any and all checks or drafts drawn on the Debtors accounts to the Employees whether those checks were issued or presented prior to or after the Petition Date, and make other transfers, provided that sufficient funds are available in the applicable accounts whether deposited pre-petition or post-petition to make the payments; IT IS FURTHER ORDERED that authorization to pay all amounts on account of the Employee Obligations shall not affect the Debtors rights to contest the amount or validity of any Employee Obligations, including, without limitation, the payroll tax obligations that may be due to any taxing authority; IT IS FURTHER ORDERED that nothing contained in this Order or in the Motion shall constitute a rejection or assumption by the Debtors, as debtors-in-possession, of any 2 All capitalized terms used herein not defined shall have the meaning ascribed to them in the Motion #6-1 File 10/17/15 Enter 10/17/15 12:31:18 Proposed Order Pg 2 of 4

19 executory contract or unexpired lease by virtue of reference to any such contract or lease in the Motion; IT IS FURTHER ORDERED that this Court shall retain jurisdiction over the Debtors and any and all parties who receive payment pursuant to this Order with respect to any matters, claims, rights, or disputes arising from or related to the Motion, the implementation of this Order or the validity of any Employee Obligations and payroll tax obligations; IT IS FURTHER ORDERED that Bankruptcy Rule 6003 has been satisfied because the relief requested in the Motion is necessary to avoid immediate and irreparable harm to the Debtors, the Employees, the Debtors estates, and creditors; IT IS FURTHER ORDERED that, notwithstanding the foregoing, nothing contained in this Order shall be deemed to be an express or implied amendment to any approved budget for any debtor-in-possession financing approved in these cases and any payment authorized by this Order shall be subject to the terms and conditions of such debtor-in-possession financing, from and after its approval; IT IS FURTHER ORDERED that notwithstanding any applicability of Bankruptcy Rule 6004(h), the terms and conditions of this Order are immediately effective and enforceable upon entry of this Order; and IT IS FURTHER ORDERED that this Court shall retain jurisdiction with respect to any matters, claims, rights, or disputes arising from or related to the implementation of this Order. # # # #6-1 File 10/17/15 Enter 10/17/15 12:31:18 Proposed Order Pg 3 of 4

20 Prepared and submitted by: GORDON, ARATA, MCCOLLAM, DUPLANTIS & EAGAN, LLC By: _/s/ Louis M. Phillips Louis M. Phillips (La. Bar No ) Peter A. Kopfinger (La. Bar No ) One American Place 301 Main Street, Suite 1600 Baton Rouge, LA Telephone: (225) Facsimile: (225) AND Armistead M. Long (La. Bar No ) 400 East Kaliste Saloom Road, Suite 4200 Lafayette, Louisiana Phone: (337) Fax: (337) AND Patrick Rick M. Shelby (La. Bar No ) 201 St. Charles Avenue, 40 th Floor New Orleans, Louisiana Telephone: (504) Proposed Attorneys for A&B Valve and Piping Systems, L.L.C.; Kimzey Casing Service, LLC; Sheffield GP, LLC; and Sheffield Holdings, LP #6-1 File 10/17/15 Enter 10/17/15 12:31:18 Proposed Order Pg 4 of 4