UNITED STATES BANKRUPTCY COURT DISTRICT OF DELAWARE

In Re: PACIFIC ENERGY RESOURCES, LTD., et al., Debtors.

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Chapter 11 Case No. 09-10785 (KJC) (Jointly Administered)

FEE AUDITORS FINAL REPORT REGARDING INTERIM FEE APPLICATION OF SCHULLY, ROBERTS, SLATTERY & MARINO PLC FOR THE SECOND INTERIM PERIOD This is the final report of Warren H. Smith & Associates, P.C., acting in its capacity as fee auditor in the above-captioned bankruptcy proceedings, regarding the Fee Application of Schully, Roberts, Slattery & Marino PLC for the Second Interim Period (the Application). BACKGROUND 1. Schully, Roberts, Slattery & Marino PLC (SRSM) was retained as special oil-and-

gas and transactional counsel to the debtors-in-possession. In the Application, SRSM seeks approval of fees totaling $479,093.50 and costs totaling $1,306.22 for its services from June 1, 2009 through August 31, 2009 (the Application Period). 2. In conducting this audit and reaching the conclusions and recommendations

contained herein, we reviewed in detail the Application in its entirety, including each of the time and expense entries included in the exhibits to the Application, for compliance with Local Rule 2016-2 of the Local Rules of the United States Bankruptcy Court for the District of Delaware, Amended Effective December 1, 2009, and the United States Trustee Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed Under 11 U.S.C. 330, Issued January 30, 1996 (the Guidelines), as well as for consistency with precedent established in the United States
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Bankruptcy Court for the District of Delaware, the United States District Court for the District of Delaware, and the Third Circuit Court of Appeals. We served on SRSM an initial report based on our review, and received a response from SRSM, portions of which response are quoted herein. DISCUSSION 3. In our initial report, we noted two time entries reflecting what appear to be activities

unbefitting the professionals billing rate: 06/01/2009 06/01/2009 DMC 1.25 DMC 1.25 250.00 250.00 Review PACER; print; Print, review and copy new filings

We asked SRSM to explain why these activities are appropriately billed at $200 per hour. Additionally, these time entries appear to be redundant of each other. We asked SRSM to state whether they represent the same 1.25 hours of activities. SRSM provided the following response, which applies to this item as well as items 5 through 7 below: The fees of DMC require further explanation. DNC is a 25 year paralegal who assisted attorneys, particularly ACM and LGW, in monitoring extensive filings in the five related bankruptcy cases and related adversary proceedings as well as litigation filed in state courts. She was tasked with reviewing all filings (including claims filings), analyzing the filings and preparing daily memoranda regarding the contents of the filings, the properties involved, the resources to be allotted to each task and interfacing with three law firms that each represented distinct aspects of the Debtors' business. Because she was involved in the Debtors' acquisitions of the oil and gas properties and co-chaired the due diligence team, her knowledge of the Debtors' business and finances as well as the institutional history of a very complicated oil and gas property portfolio was invaluable. She also was involved in the drafting of regulatory paper for oil and gas properties, a highly skilled and responsible undertaking which she was able to perform with limited supervision. While we appreciate the additional information regarding Ms. Castles activities, we do not believe that the specific entries cited here reflect the level of skill and responsibility that may have characterized other of her activities. It is our opinion that clerical tasks should be billed at no more

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than $80.00 per hour. In In re Busy Beaver Building Centers, Inc., the Third Circuit stated that "the statute [11 U.S.C. 330] plainly specifies that the type of service performed by a paralegal (including whether it is clerical) affects the rate of compensation, not compensability vel non." 19 F.3d 833, 849 (3rd Cir. 1994). Additionally, SRSM has not explained the apparent redundancy of these time entries. Thus, we believe the appropriate amount of fees is $100, or $80 per hour for 1.25 hours. Accordingly, we recommend a reduction of $400 in fees. 4. 07/09/09 07/09/09 07/10/09 In our initial report, we noted three inadequately detailed time entries: DMC (BL) Begin process of locating document(s) responsive to requests; 0.70 140.00 DMC (BL) Begin process of copying document(s) responsive to requests; 0.20 40.00 DMC (BL) Continue with process of locating document(s) responsive to requests; 0.90 202.50

We asked SRSM to explain what requests this task is responding to. Additionally, we asked SRSM to explain why this activity is appropriately billed at $200 per hour. Finally, we asked SRSM to explain why the last entry is billed at a rate of $225 per hour while the others are billed at $200 per hour. SRSMs response is included in paragraph 3 above. Again, we appreciate the response and the additional information regarding the general nature of Ms. Castles work. However, in the absence of further information regarding this specific task, we cannot conclude that these activities are not merely clerical. As is stated above, we believe that clerical tasks should be billed at no more than $80.00 per hour,1 or $144.00 for 1.80 hours. Accordingly, we recommend a reduction of $238.50 in fees. 5. In our initial report, we noted another series of inadequately detailed time entries:

Thus, the unexplained difference in billing rates is inconsequential in this context.

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07/22/09 07/22/09 07/22/09 07/23/09 07/23/09 07/23/09

DMC DMC DMC DMC DMC DMC

0.80 0.80 0.80 0.90 0.90 0.90

160.00 160.00 160.00 202.50 202.50 202.50

Begin drafting of assignments; Sale of assets Continue drafting of assignments; Continue review and drafting of assignments; Continue drafting of assignments; Continue drafting of assignments; Continue drafting of assignments;

We asked SRSM to provide a further description of this activity. Additionally, we asked SRSM to explain why the same professionals time is billed at two different rates on the same day. SRSMs response is included in paragraph 3 above. We appreciate SRSMs response and believe it indicates that the cited time entries relate to due diligence activities that go beyond merely clerical work. Accordingly, we have no objection to these fees on this basis.2 6. In our initial report, we noted that during July 2009 DMCs time is sometimes billed

at $200 per hour and is sometimes billed at $225 per hour. ACMs time is sometimes billed at $450 per hour and is sometimes billed at $550 per hour. JGSs time is sometimes billed at $220 per hour and is sometimes billed at $275 per hour. We asked SRSM to explain these inconsistencies. SRSMs response is included in paragraph 3 above. For reasons discussed in paragraph 8 below, however, we recommend a reduction of each professionals billing rate to the rate in effect at the beginning of the Application Period. To avoid double-counting, no reduction is recommended in this paragraph. 7. In our initial report, we noted that SRSM substantially increased the billing rates of

several of its timekeepers during the Application Period. These increases include a 22% increase (from $450 to $550) for an attorney (Anthony Marino) who has been a partner at SRSM since 1996

As is discussed in paragraph 8 below, however, we recommend a reduction of Ms. Castles fees to a rate of $200 per hour. To avoid double-counting, no reduction is recommended in this paragraph.
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and has been licensed in Louisiana since 1985. They also include a 25% increase for an associate (Lynn Wolf) who has been licensed in Louisiana since 1987. Guideline II.A.3 calls for disclosure of the [n]ames and hourly rates of all applicants professionals and paraprofessionals who billed time and for an explanation of any changes in hourly rates from those previously charged. We asked SRSM to explain these increases. SRSM provided the following response: Fee increases were made by the firm only after the bankruptcy cases overtook the resources of the firm. Given the intensity of the work load and the complexity of the transactions contemplated by potential purchasers, three employees worked on little other than these cases. During the same time period, the firm lost one associate (who was not replaced) and one attorney who had originally been charged with working on these matters was diagnosed with breast cancer and began chemotherapy and surgical intervention. She has only returned to full time work since mid-January 2010. The remaining attorneys were charged with working at minimum 12 hour days on these cases alone. The subject properties are located in Alaska. Bankruptcy counsel and the client are based in California. SRSM is located in Louisiana. The bankruptcy court and counsel for the lenders and the creditors are located on the east coast of the United States. One potential purchaser who had a serious bid for the AK properties was located in Shanghai with counsel located in Shanghai and New York City. During the month of July, LGW and ACM were involved in conference calls and meetings that began at 7 or 8 o'clock EDT and often ran until after midnight Alaska time (which is 3 am CDT). Because we were the only firm that had knowledge of the acquisition and day-to-day operations of the portfolio of oil and gas properties and the regulatory hurdles involved in selling such a portfolio, we had no choice but to make ourselves available 24/7. During the brief period of time when we were not in conferences, NY counsel was in conference with Shanghai client, would turn out a new draft of the purchase and sale agreement, and expect our comments for an early morning call. This went on for approximately three weeks. At the same time, we were expected to produce thousands of documents related to the properties and the oil and gas resources thereon as well as introduce the potential purchaser to the AK and federal regulators and provide guidance regarding the acquisition of trouble assets. Given the time zone issues, the language barriers, and the ongoing claims of the Debtors' creditors involving complicated oil and gas matters, the work load was grueling. The Debtors' attempts to sell the properties were complicated by the presence of Chevron and its team of New York attorneys who demanded renegotiation of several complicated agreements without which no disposition of the Debtors' properties could be consummated.
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Moreover, because of the auction process for the Debtors properties, more than one bid was being worked on at any one given time. ACM and LGW had to be available to work with several bidders concurrently. These were most strenuous times. We appreciate this response and find it persuasive regarding the issue raised in paragraph 8 below. We do not believe, however, that an ad-hoc rate increase can be justified by the work entailed by an engagement after the firm is retained with a different fee structure.3 The references to the departure of one attorney, who was not replaced, and to the volume of work performed by the remaining attorneys would seem to decrease the amount of overhead relative to the fees generated. If anything, the circumstances described by SRSM point to increased profitability even without the rate increase, and they would thus militate against a rate increase of the sort described above. While firms may increase their rates after retention to keep up with rising costs or to reflect the additional experience and expertise that an attorney has accrued, SRSM does not offer these explanations. Nor would it seem plausible that attorneys who had practiced for 20+ years could suddenly increase their market value by 22% or 25%. Accordingly, we cannot recommend allowance of the fees billed beyond the rates that were in effect as of July 1, 2009. For 53.10 hours billed by ACM at $550 per hour (formerly $450), the appropriate reduction is $5,310.00 (53.10 x $100). For 622.40 hours billed by Lynn Wolf at $375 per hour (formerly $300), the appropriate reduction is $46,680.00 (622.40 x $75). For 20.40 hours billed by paralegal Joan Seelman at $275 per hour (formerly $220), the appropriate reduction is $1,122.00 (20.40 x $55). And for 67.30 hours billed by paralegal Diane Castle at $225 per hour (formerly $200), the appropriate reduction is $1,682.50 (67.30 x $25).

The ad-hoc nature of the rate increase is further underscored by the fact that the new rates were not consistently applied during the month of July. Time entries reflecting the increased rates were sometimes followed by entries reflecting the original lower rates.
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Accordingly, we recommend a reduction of $54,794.50. 8. In our initial report, we noted that Lynn G. Wolf billed the estate for a total of 825.70 This is an

hours during the Application Period, including 325.30 hours for July alone.

extraordinarily high amount. We asked SRSM to explain how this was possible. SRSMs response is included in paragraph 7 above. We appreciate that the exigency produced by a colleagues medical leave could facilitate the extraordinary effort by other timekeepers. Additionally, as SRSMs response explains above, with the bankruptcy court in Delaware, the Debtors in California, assets in Alaska, and potential purchasers in Shanghai, we understand that Ms. Wolf often had to participate in conference calls or review and revise documents late in the evening or early in the morning. Thus, as SRSM represents to us that these hours that were billed were actually worked by Ms. Wolf, we do not object to Ms. Wolfs fees on this basis. 9. In our initial report, we noted a number of other time entries for DMC ($200/$225

per hour) and JGS ($220/$275 per hour) that appear to be clerical tasks befitting a lower billing rate. See Exhibit A. We asked SRSM to explain why these activities are appropriately billed at these rates. SRSMs response is included in paragraph 7 above. We believe the response included in paragraph 3 is also relevant. Having reviewed Exhibit A in light of SRSMs responses, we believe that a number of the scheduled time entries reflect clerical activities that should be billed at no more than $80 per hour. These time entries are listed on the attached Exhibit A-1. They encompass 3.60 hours of JGSs time billed at $220 per hour (after the reduction recommended in paragraph 8 above) and 37.20 hours of DMCs time billed at $200 per hour (after the reduction recommended in paragraph 8 above). Billed at $80 per hour, these activities would produce $3,264.00 in fees as opposed to the $8,232.00 actually billed. Accordingly, we recommend a reduction of $4,968.00 in

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fees. 10. In our initial report, we noted that one of the time entries included in Exhibit A

reflects a task that seems to have taken an inordinately long time: 06/01/2009 JGS 2.00 440.00 Review of files to find copy of Transition Agreement between DCOR and Perl; conference with Ms. Wolf regarding same;

We asked SRSM to explain why it took two hours to locate the relevant agreement. SRSM provided the following response: Retrieving documents and analysis of the contents of such documents could easily take two hours if not longer. Many of these documents were due diligence documents from the original acquisitions of the underlying oil and gas leases (that occurred 3 or 4 years earlier) and required the review and analysis of several drafts of purchase and sale agreements to determine the provisions that were actually adopted at the time. The transition agreement in question was supported by a number of side agreements as well as regulatory documents that were filed with the Minerals Management Service. Because these documents are often proprietary and not available on-line or to the public, extensive research into historical paper is required. Because some of the agreements are older documents, conferences regarding past deals and analysis of the situations that influenced the final agreements were required. Legal research was also required to determine whether the MMS regulations had changed regarding oil and gas leases in the Pacific Region and whether any new agreements would need to be put in place going forward. Fortunately, JGS was able to perform these tasks without having expend even more time going to the parties who were originally involved in the early transaction (if indeed such persons are even still available). We appreciate this response and recommend no reduction in this regard. 11. In our initial report, we noted several inadequately detailed time entries relating to

phone calls, e-mail messages, and meetings, such as the following: 06/01/2009 06/01/2009 06/01/2009 ACM 0.20 ACM 0.30 ACM 1.00 90.00 135.00 450.00 Conference with Ms. Wolf; Emails to Mr. Arlington; Emails for Redoubt contraction;

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06/04/2009

LGW 0.90

270.00

Emails regarding DE bankruptcy court requests and requirements and progress thereof

We asked SRSM to be sure, in the future, to comply with Guideline II.D.5, which provides, Time entries for telephone calls, letters, and other communications should give sufficient detail to identify the parties to and the nature of the communication. SRSM provided the following response:

All emails noted in this item dated 06/01/2009 were related to the contraction of the Redoubt unit, an action taken by the AK department of natural resources that potentially divested the Debtors and their bankruptcy estate of substantial assets that the Debtor was planning to market. Attention was paid to this matter in particular because the State of Alaska by contracting the unit would have been able to attempt to administratively claim $6.8 million in cash escrow that otherwise would benefit the Debtors' estate. The 06/04/2009 LGW entry involved emails that were responsive to questions and requests for documentation from the creditors' committee and involved location and explanation of earlier property acquisitions, regulatory financial responsibility, and producing the underlying transactional paper that put the assets in the hands of the debtor initially. The requests were forwarded to SRSM by the Pachulski firm for the benefit of the creditors. We appreciate this response. 12. In our initial report, we noted several instances in which SRSM timekeepers may

have submitted time entries that are redundant of one another. See Exhibit B. We asked SRSM to explain these entries. SRSM provided the following response:

The entries on Exhibit B only appear to be redundant of one another. Because we were instructed that we could not bill more than .90 hour for any one task, tasks that took more than .90 of an hour were divided into .90 of an hour segments. Work on schedules and exhibits for complicated purchase and sale agreements involving multiple oil and gas leases, rights-of-way, material contracts, and the like take hours to draft. The property descriptions for 90 oil and gas leases make take a number of days to enter correctly, and then they must be proofread and checked against the official records of the state department of natural resources. These exhibits are generally filed of record with the recorder's office in the jurisdiction in which the property is located and become important parts of any purchaser's chain of title and are the official record of the properties as collateral for lenders. These
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tasks are labor intensive and require the skills of a seasoned paralegal and an experience oil and gas attorney at minimum. Carelessness and errors are not tolerated in such filings and may create title exceptions. We accept this response for the first, second, sixth, and eighth items on Exhibit B but note that the remaining items include two time entries that are identical except for the billing rate. It appears that in each instance the same entry was submitted at an incorrect rate and then again at a corrected rate. In each instance, we will recommend disallowance of the amount billed at the lower rate.4 Accordingly, we recommend a reduction of $1,395.00 in fees. 13. In our initial report, we noted that the Application seeks approval of $120.85 for costs

of Reproduction for June and $104.00 for August but does not indicate the per-page charge. We asked SRSM to provide this information. SRSM provided the following response:

In our fee applications filed with the bankruptcy court, we always include the following sentence: Pursuant to Local Rule 2016-2, the Firm represents that its rate for duplication is $ .10 per page. We appreciate this response but note that, while the July and August invoices do contain the referenced statement, the August detail contradicts the statement,5 and neither the Application nor the June invoice contains such a statement. We raised this issue because the reproduction costs for June are not evenly divisible by ten cents, and thus some or all of the copies must have been charged at another rate. In a follow-up discussion, we were informed that the $120.85 figure was included

The remaining time entries reflecting the higher rates are subject to the reduction discussed in paragraph 7 above. We note that the raw detail attached to the August invoice states that it is charging for 1,300 copies at a cost of $0.25 per page, and yet the $104.00 actually requested calculates to just $0.08 per page, and thus we have no objection to that charge.
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5

by mistake, and the actual amount of copy charges for June was $120.80, reflecting copies made at $0.10 per page. We appreciate this response and recommend a reduction of $0.05 in expenses. CONCLUSION 14. Thus, we recommend final approval of fees totaling $417,297.50 ($479,093.50 minus

$61,796.00) and expenses totaling $1,306.17 ($1,306.22 minus $0.05) for SRSMs services for the Application Period.

Respectfully submitted, WARREN H. SMITH & ASSOCIATES, P.C.

By: Warren H. Smith Texas State Bar No. 18757050 Mark W. Steirer Texas State Bar No. 19139600 325 N. St. Paul Street, Suite 1250 Republic Center Dallas, Texas 75201 214-698-3868 214-722-0081 (fax) whsmith@whsmithlaw.com FEE AUDITOR

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CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing document has been served via First-Class United States mail to the attached service list on this 2nd day of March, 2010.

Warren H. Smith

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SERVICE LIST The Applicant Anthony C. Marino, Esq. Lynn G. Wolf, Esq. Schully, Roberts, Slattery & Marino PLC 1100 Poydras Street, Suite 1800 New Orleans, LA 70163-1800 United States Trustee Office of the United States Trustee 844 N. King Street, Room 2207 Lock Box 35 Wilmington, DE 19801 Counsel to the Debtors Laura Davis Jones, Esq. Ira D. Kharasch, Esq. Scotta E. McFarland, Esq. Robert M. Saunders, Esq. James E. ONeill, Esq. Kathleen P. Makowski, Esq. Pachulski Stang Ziehl & LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington DE 19899-8705 Counsel to the Debtors Ian S. Fredericks, Esq. Skadden Arps, Slate, Meagher & Flom LLP One Rodney Square P.O. Box 636 Wilmington, DE 19899 Special Counsel to the Debtors Penelope Parmes, Esq. Rutan & Tucker, LLP 611 Anton Boulevard 14th Floor Costa Mesa, CA 92626 Canadian Counsel to the Debtors Jensen Lunny MacInnes Law Corporation H.C. Ritchie Clark, Q.C. P.O. Box 12077 Suite 2550 555 West Hastings Street Vancouver, BC V6B 4N5 Engineering Consultant to the Debtors Mark A. Clemans Millstream Energy, LLC 4918 Menlo Park Drive Sugarland, TX 77479 Special Oil & Gas Transactional Counsel to the Debtors Anthony C. Marino, Esq. Schully, Roberts, Slattery & Marino PLC Energy Centre 1100 Poydras Street, Suite 1800, New Orleans, LA 70163 Financial Advisor to the Debtors Curtis A. McClam Deloitte Financial Advisory Services LLP 350 South Grand Ave, Ste. 200 Los Angeles, CA 90071 Financial Advisor to the Debtors John Rutherford Lazard Freres & Co. LLC 30 Rockefeller Plaza, 61st Floor New York, NY 10020

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Co-Counsel to the Official Committee of Unsecured Creditors David B. Stratton, Esq. James C. Carignan, Esq. Pepper Hamilton LLP Hercules Plaza, Suite 1500 1313 Market Street Wilmington, DE 19899 Co-Counsel to the Official Committee of Unsecured Creditors Filiberto Agusti, Esq. Steven Reed, Esq. Joshua Taylor, Esq. Steptoe & Johnson LLP 1330 Connecticut Avenue NW Washington, DC 20036

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Exhibit A 06/01/2009 06/04/2009 06/04/2009 DMC 1.00 DMC 1.00 JGS 2.00 200.00 200.00 440.00 Index and organize updates of pleading filed in PERL Bankruptcy proceedings; Review PACER; print, review and copy new filings; Review of files to find copy of Transition Agreement between DCOR and Perl; conference with Ms. Wolf regarding same; Index and organize updates of pleading filed in PERL Bankruptcy proceeding; Provide necessary copies to attorneys; Set up new files; Continue with review of PACER; Print, review and copy new filings; Index and organize updates of pleading filed in PERL Bankruptcy proceeding; Provide necessary copies to attorneys; Set up new files; Continue with indexing of additional pleadings filed in Bankruptcy Proceeding; Continue with indexing of additional pleadings filed in Bankruptcy Proceeding; Prepare new advisary proceeding files; Review PACER to print, organize and index all new pleadings; Continue review of PACER to print, organize and index all new pleadings; Travel to MMS to file OSFR 1019 and 1021 forms; scan and sent documents to Ms. Kerrigan; Review PACER to print, organize and index all new pleadings; Review PACER to print, organize and index all new pleadings;

06/04/2009 06/04/2009 06/04/2009 06/05/2009 06/05/2009 06/05/2009 06/05/2009 06/05/2009 06/10/2009 06/11/2009 06/11/2009 06/19/2009 06/22/2009 06/23/2009 06/25/2009 06/29/2009

DMC 1.00 DMC 0.90 DMC 0.90 DMC 0.90 DMC 0.50 DMC 0.90 DMC 0.90 DMC 0.90 DMC 1.00 DMC 1.00 DMC 0.80 DMC 3.60 DMC 1.50 JGS 0.80

200.00 180.00 180.00 180.00 100.00 180.00 180.00 180.00 200.00 200.00 160.00 720.00 300.00 176.00 500.00 200.00

DMC 2.50 DMC 1.00

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06/30/2009

DMC 1.60

320.00

Update all pleadings clips to include recent filings and update indices (1.50); ... Review PACER to print new pleadings filed since June 30, 2009; Review new pleadings index filed since June 30, 2009: Organize new pleadings filed since June 30, 2009; Continue to index pleadings files; (AD) Pulled some documents requested in due diligence e-mail; Continue with review of PACER to obtain and index all recent pleadings; analysis, prepare memo and report to ACM Prepare index of all recent pleadings and analysis; Continue review of PACER to obtain all recent pleadings and prepare memo; Review of PACER to obtain and index all recent pleadings; Obtain and index all recent pleadings from PACER; prepare summary Index all recent pleadings; Analyze and prepare memoranda Continue to index recent pleadings; analyze and prepare memo Continue indexing all recent pleadings; Report to LGW with notation Locate copies of Trading Bay Field Joint Operating Agreement; Review PACER to obtain copies of pleadings (1.40); copy, index and file recent pleadings filed of record (2.80); Prepare memos Set up PSA and Bid files; prepare analysis of bids

07/06/2009 07/06/2009 07/06/2009 07/07/2009 07/08/2009 07/17/2009

DMC DMC DMC DMC JGS DMC

0.90 0.90 0.20 0.90 0.80 0.90

180.00 180.00 40.00 202.50 220.00 180.00

07/17/2009 07/17/2009 07/17/2009 07/17/2009 07/20/2009 07/20/2009 07/20/2009 07/23/2009 07/24/2009

DMC DMC DMC DMC DMC DMC DMC DMC DMC

0.90 0.90 0.50 0.50 0.90 0.90 0.90 0.90 4.20

180.00 180.00 100.00 100.00 202.50 180.00 180.00 180.00 945.00

07/27/2009

DMC

0.70

157.50

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07/27/2009 07/27/2009 07/28/2009 07/28/2009 07/30/2009 07/30/2009 07/31/2009 08/03/2009 08/03/2009 08/20/2009

DMC DMC DMC DMC DMC DMC DMC JGS DMC DMC

1.00 0.70 1.00 0.30 0.30 0.70 1.90 0.90 0.80 0.90

225.00 140.00 225.00 60.00 67.50 140.00 427.50 247.50 180.00 202.50

Update and organize files; prepare closing documents Continue setting up PSA and Bid files; Index and file recent pleadings filed of record; prepare analysis of claims Update bid files; Continue with review of PACER; Continue review, index and file pleadings; update memo to Ms. Wolf Review of PACER and index/file pleadings; Update claims spreadsheet Reviewed files to pull unit and regulatory filing information for Beat Unit; Schedule, index and evaluate pleadings; conference with Mr. Marino; Gather and copy all Trading Bay Unit Documents for transmittal to Mr. Saunders and prepare memorandum; Review, index and file recent pleadings; Continued review, index and file recent pleadings; Prepare index of right of way documents; Scan relative documents for transmittal; Email scanned documents to K. Brown, R. Saunders; J.D. Arlington and Hartig

08/25/2009 08/25/2009 08/25/2009 08/25/2009 08/25/2009

DMC DMC DMC DMC DMC

1.00 0.50 0.90 0.90 0.50

225.00 112.50 202.50 202.50 112.50

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Exhibit A-1 06/01/2009 06/04/2009 06/04/2009 DMC 1.00 DMC 1.00 JGS 2.00 200.00 200.00 440.00 Index and organize updates of pleading filed in PERL Bankruptcy proceedings; Review PACER; print, review and copy new filings; Review of files to find copy of Transition Agreement between DCOR and Perl; conference with Ms. Wolf regarding same; Index and organize updates of pleading filed in PERL Bankruptcy proceeding; Provide necessary copies to attorneys; Set up new files; Continue with review of PACER; Print, review and copy new filings; Index and organize updates of pleading filed in PERL Bankruptcy proceeding; Provide necessary copies to attorneys; Set up new files; Continue with indexing of additional pleadings filed in Bankruptcy Proceeding; Continue with indexing of additional pleadings filed in Bankruptcy Proceeding; Prepare new advisary proceeding files; Review PACER to print, organize and index all new pleadings; Continue review of PACER to print, organize and index all new pleadings; Travel to MMS to file OSFR 1019 and 1021 forms; scan and sent documents to Ms. Kerrigan; Review PACER to print, organize and index all new pleadings; Review PACER to print, organize and index all new pleadings;

06/04/2009 06/04/2009 06/04/2009 06/05/2009 06/05/2009 06/05/2009 06/05/2009 06/05/2009 06/10/2009 06/11/2009 06/11/2009 06/19/2009 06/22/2009 06/23/2009 06/25/2009 06/29/2009

DMC 1.00 DMC 0.90 DMC 0.90 DMC 0.90 DMC 0.50 DMC 0.90 DMC 0.90 DMC 0.90 DMC 1.00 DMC 1.00 DMC 0.80 DMC 3.60 DMC 1.50 JGS 0.80

200.00 180.00 180.00 180.00 100.00 180.00 180.00 180.00 200.00 200.00 160.00 720.00 300.00 176.00 500.00 200.00

DMC 2.50 DMC 1.00

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06/30/2009

DMC 1.60

320.00

Update all pleadings clips to include recent filings and update indices (1.50); ... Review PACER to print new pleadings filed since June 30, 2009; Review new pleadings index filed since June 30, 2009: Organize new pleadings filed since June 30, 2009; Continue to index pleadings files; (AD) Pulled some documents requested in due diligence e-mail; Prepare index of all recent pleadings and analysis; Review of PACER to obtain and index all recent pleadings; Continue to index recent pleadings; analyze and prepare memo Continue indexing all recent pleadings; Report to LGW with notation Review PACER to obtain copies of pleadings (1.40); copy, index and file recent pleadings filed of record (2.80); Prepare memos Continue setting up PSA and Bid files; Update bid files; Continue with review of PACER; Schedule, index and evaluate pleadings; conference with Mr. Marino; Review, index and file recent pleadings; Continued review, index and file recent pleadings; Scan relative documents for transmittal; Email scanned documents to K. Brown, R. Saunders; J.D. Arlington and Hartig

07/06/2009 07/06/2009 07/06/2009 07/07/2009 07/08/2009 07/17/2009 07/17/2009 07/20/2009 07/20/2009 07/24/2009

DMC DMC DMC DMC JGS DMC DMC DMC DMC DMC

0.90 0.90 0.20 0.90 0.80 0.90 0.50 0.90 0.90 4.20

180.00 180.00 40.00 202.50 220.00 180.00 100.00 180.00 180.00 945.00

07/27/2009 07/28/2009 07/30/2009 08/03/2009 08/25/2009 08/25/2009 08/25/2009 08/25/2009

DMC DMC DMC DMC DMC DMC DMC DMC

0.70 0.30 0.30 0.80 1.00 0.50 0.90 0.50

140.00 60.00 67.50 180.00 225.00 112.50 202.50 112.50

FEE AUDITORS FINAL REPORT - Page 19 pac FR Schully 2nd int 6-8.09.wpd

Exhibit B

1.

We note two sets of time entries that appear to be redundant of each other: ACM (AD) Conference call with Dewey, Rutan & consultants regarding PSA draft; 1.00 550.00 ACM (AD) Follow-up conference call with Dewey et al. on Polytec PSA; 0.90 495.00 ACM (AD) Conference call with Dewey, Rutan & consultants regarding PSA draft; 1.00 550.00 ACM (AD) Follow-up conference call with Dewey et al. on Polytec PSA; 0.90 495.00

07/17/09

07/17/09

07/17/09

07/17/09

2.

We note another instance in which a pair of time entries appear to be redundant of each other: LGW (AD) Send MMS 15 Step procedure to attorneys at V&E for Silverpoint; conference call to discuss qualification for Pacific region 0.90 337.50 LGW (AD) Send MMS 15 Step procedure to attorneys at V&E for Silverpoint; conference call to discuss qualification for Pacific region 0.90 337.50

07/23/09

07/23/09

3.

We note another instance in which a pair of time entries appear to be redundant of each other: ACM (AD) Various lenders' PSA for Beta Unit; 0.60 330.00 ACM (AD) Various lenders' PSA for Beta Unit; 0.60 270.00

07/25/09

07/25/09

4.

We note another instance in which a pair of time entries appear to be redundant of each

FEE AUDITORS FINAL REPORT - Page 20 pac FR Schully 2nd int 6-8.09.wpd

other: 07/25/09 ACM Review Beta PSA and forward to Clinsky Parker for comment; 1.00 550.00 ACM Revise Beta PSA and forward to Clinsky Parker for comment; 1.00 450.00

07/25/09

5.

We note another instance in which a pair of time entries appear to be redundant of each other: ACM (AD) Conference call with Dewey team and Pearl team to discuss status of PSA changes for Group 1 assets; 0.90 495.00 ACM (AD) Conference call with Dewey team and Pearl team to discuss status of PSA changes for Group 1 assets; 0.90 405.00

07/28/09

07/28/09

6.

We note another instance in which a pair of time entries appear to be redundant of each other: LGW (AD) Continue intensive work on schedules and exhibits to BETA PSAs - Polytec ,OCAR 0.90 337.50 LGW (AD) Continue intensive work on schedules and exhibits to BETA PSAs - Polytec ,OCAR 0.90 337.50

07/30/09

07/30/09

7.

We note another instance in which a pair of time entries appear to be redundant of each other: ACM (AD) Conference call with Dewey Team and Mr. Perkins regarding Kitchen Lights Unit; 0.60 330.00

07/30/09

07/30/09

ACM (AD) Conference call with Dewey Team and Mr. Perkins regarding Kitchen Lights Unit;

FEE AUDITORS FINAL REPORT - Page 21 pac FR Schully 2nd int 6-8.09.wpd

0.60

270.00

8.

We note another instance in which a pair of time entries appear to be redundant of each other: DMC 0.90 180.00 Continue with review of PACER to obtain and index all recent pleadings; analysis, prepare memo and report to ACM Continue review of PACER to obtain all recent pleadings and prepare memo;

07/17/2009

07/17/2009

DMC

0.90

180.00

FEE AUDITORS FINAL REPORT - Page 22 pac FR Schully 2nd int 6-8.09.wpd