UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re Chapter 11 BACK YARD BURGERS, INC., et a/. Debtors.

(Joint Administration Pending) Ref. Docket No. 6 ORDER (A) AUTHORIZING DEBTORS TO PAY (I) ALL PREPETITION EMPLOYEE OBLIGATIONS, AND (II) PREPETITION WITHHOLDING OBLIGATIONS, AND (B) DIRECTING BANKS TO HONOR RELATED TRANSFERS Upon the motion (the "Motion")2 filed by the above-captioned debtors and debtors-inpossession (collectively, the "Debtors") seeking entry of an order pursuant to sections 105, 363, 364, 503, 507(a)(4), 507(a)(5), and 541, 1107 and 1108 oftitle 11 ofthe United States Code, 11 U.S.C. 101, et seq. (the "Bankruptcy Code"), (a) authorizing, but not directing, the Debtors to pay (i) prepetition compensation and other amounts owed to the Debtors' current employees up to the relevant statutory cap for each employee, and (ii) all prepetition federal and state withholding obligations, and (b) directing all banks to honor the Debtors' prepetition checks or electronic transfers for payment of any of the foregoing, and prohibiting banks from placing any holds on, or attempting to reverse, any automatic transfers on account of the foregoing; and upon the Declaration ofJames Boyd in Support of the Debtors' Chapter 11 Petitions and Requests for
1

Case No. 12-12882 (PJW)

First Day Relief(the "First Day Declaration"); and it appearing that this Court has jurisdiction
to consider the Motion pursuant to 28 U.S.C. 157 and 1334; and it appearing that venue of these cases and the Motion in this district is proper pursuant to 28 U.S.C. 1408 and 1409; and

The Debtors in these chapter 11 cases, along with the last four digits of each Debtor's federal tax identification number, are: Back Yard Burgers, Inc. (7163), BYB Properties, Inc. (9046), Nashville BYB, LLC (6507) and Little Rock Back Yard Burgers, Inc. (9133). The mailing address of the Debtors is: St. Clouds Building, 500 Church Street, Suite 200, Nashville, TN 37219. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Motion.
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it appearing that this matter is a core proceeding pursuant to 28 U.S.C. 157(b); and this Court having determined that the relief requested in the Motion is in the best interests of the Debtors, their estates, their creditors and other parties in interest; and it appearing that proper and adequate notice of the Motion has been given and that no other or further notice is necessary; and after due deliberation thereon; and good and sufficient cause appearing therefor,
IT IS HEREBY ORDERED THAT:

1. herein. 2.

For the reasons set forth on the record, the Motion is GRANTED, as set forth

The Debtors are authorized, but not required, to honor and pay all prepetition

Employee Obligations in accordance with the Debtors' stated policies and in the ordinary course of the Debtors' business, provided however, that payments on account of prepetition Employee Obligations shall not exceed the amounts set in Exhibit A of this Order. Notwithstanding any other provision of this order, no payments to any individual employee shall exceed the amount set forth in 11 USC sections 507(a)(4) and 507(a)(5). 3. The Debtors are authorized to continue to honor their Retirement Plan and

Flexible Spending Program. 4. The Debtors are authorized, but not required, to continue to honor their agreement

with ADP. Nothing herein shall constitute an assumption or rejection of the ADP Agreement. 5. Nothing herein shall be deemed to (1) authorize the payment of any amounts in

satisfaction of pre-petition bonus or severance obligations, or which are subject to section 503(c) of the Bankruptcy Code; or (2) authorize the Debtors to cash out unpaid vacation/leave time upon termination of an employee, unless applicable state law requires such payment. 6. Nothing herein shall foreclose any party in interest from objecting to payment of

post-petition Executive Benefits, Parking Benefits or other Employee Obligations provided to

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any "insider," as that term is defined in the Bankruptcy Code, or management of the Debtors. 7. All of the Debtors' banks are authorized and directed to receive, process, honor,

and pay any and all checks or electronic transfers drawn on the Debtors' payroll and general disbursement accounts related to ordinary course employee compensation and benefits, including wages, salaries, bonuses, severance and other compensation, Employee Health Plans, Vacation Days, Bereavement Leave, Short Term Disability Insurance, Long Term Disability Insurance, Basic Life Insurance, Business Expenses, Parking Benefits, and Withholding Obligations authorized by this Order, whether presented before or after the Petition Date, provided that sufficient funds are on deposit in the applicable accounts to cover such payments. 8. Notwithstanding anything to the contrary contained herein, any payment to be

made, or authorization contained, hereunder shall be subject to the requirements imposed on the Debtors under any approved debtor-in-possession financing facility, or any order regarding the use of cash collateral. 9. To the extent that any employment or related agreements may be deemed

executory contracts within the meaning of section 365 of the Bankruptcy Code, the Debtors do not at this time seek authority to assume such contracts, and no relief is granted in respect thereof. 10. Rule 6003(b) of the Federal Rules of Bankruptcy Procedure (the "Bankruptcy

Rules") has been satisfied because the relief requested in the Motion is necessary to avoid

immediate and irreparable harm to the Debtors. 11. Notwithstanding any applicability of Bankruptcy Rule 6004(h), the terms and

conditions of this Order shall be immediately effective and enforceable upon its entry. 12. The Court shall retain jurisdiction to hear and determine all matters arising from

or related to the implementation of this Order.

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Dated:

t9 '1

?,

2012

UNITED STATES BANKRUPTCY JUDGE

PE~.~ /JJJdlt

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Exhibit A

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EmJ!lo:yee Obligations CaJ!

Independent Consultant Cap Wages and Salaries Cap

AD PCap

$12,750 $522,500 $7,790 $122,000 $25,000 $1,760 $150 $129,000 $150 $2,500 $4,300 $117,800

Vacation Days Cap Health Insurance Premium Cap Disability Insurance Cap Life Insurance Cap Workers' Compensation Program Cap Flexible Spending Program Cap Parking B enefit Cap Executive Expense Cap Withholding Obligations Cap

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