In re

UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE
Chapter II
Case No. 09-12416 (PJW)
ELECTROGLAS, INC., eta!.,
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)
)
)
)
)
)
(Joint Administration Pending)
Debtors.
__________________________ )
Related Docket No. 8
ORDER (I) AUTHORIZING PREPETITION WAGE, SALARY AND BENEFIT
PAYMENTS; (II) AUTHORIZING EMPLOYEE BENEFIT PROGRAMS; AND
(Ill) DIRECTING ALL BANKS TO HONOR RELATED PREPETITION CHECKS
THIS MATTER having come before the Bankruptcy Court upon the motion (the
"Motion"i of the Debtors for entry of an order pursuant to sections I OS( a), 363(b ), 507(a)( 4),
1107(a) and 1108 of the Bankruptcy Code: (a) authorizing, but not directing, the Debtors to pay
certain prepetition wages, salaries, and benefits of their Employees; (b) authorizing, but not
directing, the Debtors to continue their prepetition employee benefit programs or enter into other
substantially equivalent employee benefit programs; (c) authorizing, but not directing, the
Debtors to pay prepetition payroll and other employee-related taxes; (d) authorizing and
directing all banks to honor prepetition checks for payment of prepetition wage, salary and
benefit obligations; and (e) prohibiting banks from placing any holds on, or attempting to
reverse, any automatic transfers to Employees' accounts for prepetition wages and benefits; and
the Bankruptcy Court having found that: (a) it has jurisdiction over the matters raised in the
Motion pursuant to 28 U.S.C. !57 and 1334(b); (b) this is a core proceeding pursuant to 28
U.S.C. 157(b)(2); (c) the relief requested in the Motion is in the best interests ofthe Debtors,
their estates and their creditors; (d) proper and adequate notice of the Motion and the hearing on
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The Debtors are Electroglas, Inc. (EIN 77-0336101) and Electroglas International, Inc. (EIN 77-0345011).
Capitalized terms used but not defmed in this Order shall have the meanings ascribed to them in the Motion.
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Docket No. 36
July 13, 2009
the Motion has been given and that no other or further notice is necessary or required; and (e)
upon the record and after due deliberation, good and sufficient cause exists for the granting of
the relief as set forth in this Order; it is hereby
ORDERED, that the Motion is GRANTED in its entirety; and it is further
ORDERED, that subject to the requirements of sections 507(a)(4) and (a)(5) of the
Bankruptcy Code, the Debtors are authorized, but not directed, to pay or otherwise honor all
Prepetition Wages and Benefits, as described in the Motion, to, or for the benefit of, the
Employees, in an amount not to exceed $130,000.00; and it is further
ORDERED, that the Debtors are authorized, but not directed, to continue the prepetition
Employee Benefit Programs or enter into replacement programs for all or some Employee
Benefit Programs in the ordinary course of business; provided, however that the payment,
continuance of these programs, other honoring of such Prepetition Wages and Benefits, or entry
of this Order shall not make these obligations administrative expenses of the estates entitled to
priority status under sections 507 and 503 of the Bankruptcy Code; and it is further
ORDERED, that, in accordance with this Order and any other order of the Bankruptcy
Court, each of the banks and financial institutions at which the Debtors maintain their accounts is
authorized and directed to honor checks presented for payment, and to honor all funds transfer
requests made by the Debtors related to the payments authorized by this Order, to the extent that
sufficient funds are on deposit in the relevant accounts; and it is further
ORDERED, that each of the banks and other financial institutions where the Debtors
maintain their bank accounts is prohibited from placing any holds on, or attempting to reverse,
any automatic transfers to Employees' accounts for prepetition wages and benefits;
ORDERED, that the Debtors are authorized to pay the appropriate parties any and all
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amounts withheld from the wages of Employees, including, but not limited to, Social Security,
FICA, federal, state and local income taxes, garnishments, health care payments, charitable
donations and other types of withholding, whether these relate to a period before the Petition
Date or a subsequent period; and it is further
ORDERED, that the Debtors are authorized, but not directed, to pay prepetition amounts
owing in the ordinary course of business to third parties in connection with administering and
maintaining the Employee Benefit Programs; and it is further
ORDERED, that nothing in this Order, nor any payments made by the Debtors pursuant
to this Order, shall change or modify the classification of any claim or in any way change or
modify the rights or create new rights of the holder of any claim, and any claim of an Employee
shall be reduced by any amounts received by that Employee pursuant to the relief requested in
this Order; and it is further
ORDERED, that neither the provisions ofthis Order, nor any payments made by the
Debtors pursuant to the Motion or this Order, shall be deemed to constitute an assumption of any
Employee Benefit Program or other contract, or otherwise affect the Debtors' rights under
section 365 of the Bankruptcy Code to assume or reject any executory contract between the
Debtors and any Employee or any other entity; and it is further
ORDERED, that the Debtors, their officers, employees and agents are authorized to take
or refrain from taking such acts as are necessary and appropriate to implement and effectuate the
relief granted in this Order without further order of the Bankruptcy Court; and it is further
ORDERED, that the requirements of Bankruptcy Rule 6003 have been satisfied; and it is
further
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ORDERED, that the Bankruptcy Court shall retain exclusive jurisdiction to enforce the
terms of this Order.
Dated:

UNITEDSTA ES BANKRUPTCY JUDGE -
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