UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION - DETROIT IN THE MATTER OF: COLLINS &

AIKMAN CORPORATION, Case No. 05-55927-SWR Honorable STEVEN W. RHODES Chapter 11 Jointly Administered

Debtors. _________________________________/

OBJECTION OF TOYOTA MOTOR CREDIT CORPORATION TO DEBTORS MOTION FOR ENTRY OF AN ORDER AUTHORIZING DEBTORS TO REJECT CERTAIN EXECUTORY CONTRACTS WITH TOYOTA MOTOR CREDIT CORPORATION NOW COMES Creditor, Toyota Motor Credit Corporation (TMCC), by and through its counsel, KILPATRICK & ASSOCIATES, P.C., and for its Objection to Debtors Motion for Entry of an Order Authorizing Debtors to Reject Certain Executory Contracts with Toyota Motor Credit Corporation, states as follows: 1. On or about May 17, 2005, the Debtors filed Voluntary Petitions under Chapter 11, Title

11 of the U.S. Bankruptcy Code. 2. On the date of the filing of this case, the Debtors were in possession of 166 units of

equipment (Equipment) which the Debtors had leased from TMCC. 3. The Debtors executed a Master Lease Agreement dated November 1, 1999 and various

Supplements for specific items of equipment dated thereafter for the lease of the Equipment from TMCC (Leases). TMCC holds an ownership interest in the Equipment. 4. On August 11, 2005, this Court entered the Stipulated Order Providing for Adequate

Protection Payments to Toyota Motor Credit Corporation [Docket 917] (Adequate Protection Order) requiring the Debtors to make payments to TMCC for the continued regular use of the Equipment pending assumption or rejection of the Leases. 5. On September 14, 2005, TMCC filed its Motion for Order Requiring Debtors to Assume

or Reject Leases on Equipment on Behalf of Toyota Motor Credit Corporation [Docket 1166].

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On November 22, 2005, the Court entered the Order Regarding Motion of Toyota Motor

Credit Corporation Requiring Debtors to Assume or Reject Certain Equipment Leases [Docket 1801] (Order to Assume or Reject). 7. The Order to Assume or Reject required that the Debtors must assume or reject the

Leases by May 10, 2006. 8. On January 12, 2006, TMCC filed its Renewed Motion for Order Requiring Debtors to

Assume or Reject the Leases based on the Debtors usage of the Equipment in excess of the hours agreed to in the Leases [Docket 2048]. 9. On April 7, 2006, the Court entered the Order (A) Denying Renewed Motion for Order

Compelling Debtors to Assume or Reject Lease on Equipment on Behalf of Toyota Motor Credit Corporation; (B) Requiring Accounting of Post-Petition Over Usage and (C) Awarding Administrative Expense and Requiring Payment Thereon [Docket 2568] (Administrative Expense Order). 10. On May 10, 2006, the Debtors filed the Debtors Motion for Entry of an Order

Authorizing the Debtors to Reject Certain Executory Contracts with Toyota Motor Credit Corporation [Docket 2718] (Motion to Reject). 11. In the Motion to Reject, the Debtors state their desire to reject the Leases but request that

they have until August 31, 2006 to continue to use the 137 units of Equipment before surrendering the Equipment to TMCC. 12. reorganization. 13. TMCC does not oppose the Debtors rejection of the Leases but requests immediate The Debtors have determined that the Leases are not beneficial to an effective

surrender of the Equipment. 14. The Debtors have had 12 months since the filing of the case and six months since the

entry of the Order to Assume or Reject in which to determine the need for the Equipment and locate alternative suppliers.

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Upon information and belief, the Debtors planned to reject these leases as long ago as

February of 2006 pursuant to information provided by Debtors counsel. 16. TMCC is informed that at least some of the Equipment is located at the Debtors

Farmville, North Carolina facility, which Debtors plan to close shortly. 17. Although 11 U.S.C. 365(d)(2) allows the Debtors a reasonable time within which to

determine whether to assume or reject an executory contract, an additional three and a half months to retain and use the Equipment beyond the six months originally given by this Court is unreasonable. 18. upon rejection. 19. The Debtors retention of the Equipment after they have rejected the Leases but while TMCC is not adequately protected without the immediate surrender of all Equipment

they are looking for replacement equipment subjects the Equipment to overusage, abuse and vandalism, thereby subjecting TMCC with a loss. 20. The Debtors continued use of the Equipment subject to TMCCs interest beyond the

agreed hours under the Leases, will cause damage to TMCC because of the rejection of the Leases, damage to the Equipment because of misuse or abuse and possible abandonment of Equipment in closed plant locations. 21. The Equipment continues to depreciate on a daily basis.

WHEREFORE, Toyota Motor Credit Corporation prays this Court issue an Order (a) (b) authorizing the rejection of the Leases; requiring the Debtors to immediately surrender the Equipment to Toyota Motor Credit Corporation; (c) granting Toyota Motor Credit Corporation relief from the automatic stay pursuant to 11 U.S.C. 362(d)(1) so that it may take possession of the Equipment, treat the Debtors as in default under the Leases and enforce Toyota Motor Credit Corporations rights under the Leases; and

(d)

grant whatever further and other Relief this Court deems just and proper. Respectfully submitted; KILPATRICK & ASSOCIATES, P.C.

Dated: May 17, 2006

/s/ Leonora K. Baughman RICHARDO I. KILPATRICK (P35275) LEONORA K. BAUGHMAN (P33534) Attorneys for Creditor, Toyota Motor Credit Corporation 903 North Opdyke Road, Suite C Auburn Hills, MI 48326 ecf@kaalaw.com (248) 377 - 0700