HUNTON ANDREWS KURTH LLP 

Riverfront Plaza, East Tower 

951 East Byrd Street 

Richmond, Virginia 23219 

Telephone: (804) 788-8200 

Facsimile: (804) 788-8218 

Tyler P. Brown (VSB No. 28072) 

Jason W. Harbour (VSB No. 68220) 

Proposed Counsel to the Debtor 

and Debtor in Possession

IN THE UNITED STATES BANKRUPTCY COURT 

FOR THE EASTERN DISTRICT OF VIRGINIA 

RICHMOND DIVISION 

In re: 

LECLAIRRYAN PLLC, 

Debtor.1

Chapter 11 

Case No. 19-34574 (KRH) 

SECOND INTERIM ORDER AUTHORIZING LECLAIRRYAN PLLC TO 

USE CASH COLLATERAL, GRANTING ADEQUATE PROTECTION 

AND RELATED RELIEF, AND SCHEDULING A FINAL HEARING 

 Upon the motion (the “Motion”)2 of LeClairRyan PLLC, the above-captioned debtor and 

debtor-in-possession (“LeClairRyan” or the “Debtor”) for entry of an order, pursuant to sections 

105, 361, and 363 of the Bankruptcy Code and Bankruptcy Rule 4001, authorizing the Debtor to 

use cash collateral and granting certain adequate protection and related relief; the Court finds 

that: (a) it has jurisdiction over the matters raised in the Motion pursuant to 28 U.S.C. §§ 157 and 

1334(b); (b) this is a core proceeding pursuant to 28 U.S.C. § 157(b)(2); (c) the relief requested 

1

 The last four digits of the Debtor’s federal tax identification number are 2451. 

2

 Unless otherwise defined herein, all capitalized terms shall have the meaning ascribed to them in the 

Motion.

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in the Motion is in the best interest of the Debtor, its estate and creditors, and is necessary to 

prevent immediate and irreparable harm to the Debtor, and its estate and operations; (d) proper 

and adequate notice of the Motion and the hearing thereon has been given and no other or further 

notice is necessary; (e) the Lender and ULXP are adequately protected by virtue of the adequate 

protection provided in Paragraphs 3 – 7; and (f) upon the record herein after due deliberation 

thereon, good and sufficient cause exists for the granting of the relief as set forth herein. 

Therefore, 

 IT IS HEREBY ORDERED THAT: 

1. The relief requested in the Motion is hereby GRANTED on an interim basis. 

2. Subject to paragraph 10 and to the entry of an order, to be submitted to the Court 

on September 26, 2019, which provides for the conversion of the Debtor’s case to Chapter 7 

effective as of 12:00 p.m. on October 4, 2019, the Debtor is authorized to use cash collateral 

solely in accordance with the Budget attached hereto as Exhibit 1 to satisfy (i) any and all prePetition Date operating and other expenses approved by the Court, (ii) obligations incurred in the 

ongoing post-Petition Date operation of the Debtor’s business, and (iii) any and all costs and 

expenses arising in connection with the administration of the Debtor’s estate, including, without 

limitation, for the payment of any fees and expenses owed to professionals employed by the 

Debtor in this chapter 11 case upon the entry of an order from this Court authorizing the payment 

of such professional’s fees and expenses.

3. While reserving the rights of all parties to contest whether and the extent to which 

the Lender has valid perfected security interests in any of the Debtor’s property, for the purpose 

of providing adequate protection on account of any valid perfected security interests the Lender 

may have in the Debtor’s property as of the Petition Date (collectively, “Lender’s Collateral”), 

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the Lender is hereby granted as security solely to the extent of the diminution in the value of the 

Lender’s Collateral, a valid, perfected, and enforceable security interest (the “Lender 

Replacement Liens”) in and upon the Lender’s Collateral in existence as of the Petition Date or 

thereafter acquired (i) to the extent of any diminution in value of Lender’s interests in the 

Lender’s Collateral, including, without limitation, any such diminution in value resulting from 

the use (including, without limitation, use in accordance with this Interim Order) by the Debtor 

of the cash collateral and any other Lender’s Collateral and the imposition of the automatic stay 

pursuant to Bankruptcy Code section 362, and (ii) to the same extent, nature, and priority of any 

security interests held by the Lender as of the Petition Date.

4. While reserving the rights of all parties to contest whether and the extent to which 

ULXP has valid perfected security interests in any of the Debtor’s property, for the purpose of 

providing adequate protection for any valid perfected security interests ULXP may have in the 

cash collateral, ULXP is hereby granted as security solely to the extent of the diminution in the 

value of the cash collateral, a valid, perfected, and enforceable security interest subordinate in all 

respects to the Lender Replacement Liens (the “ULXP Replacement Liens”; and together with 

the Lender Replacement Liens, the “Replacement Liens”) in and upon the cash collateral (i) to 

the extent the cash collateral is used by the Debtor pursuant to the Budget and (ii) to the same 

extent, nature, and priority of any security interests held by ULXP as of the Petition Date. 

5. The Replacement Liens shall be valid, perfected, enforceable, and effective upon 

entry of this Interim Order without the necessity of execution, filing, or recordation of any 

financing statements or security agreements; provided, however, that notwithstanding anything 

else in this Interim Order, the Replacement Liens shall not encumber or otherwise attach to 

(a) any causes of action under chapter 5 of the Bankruptcy Code or any proceeds of such causes 

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of action or (b) any property in which the Debtor does not hold an equitable interest, including 

without limitation any property in which the Debtor holds only legal title such as funds held in 

trust. 

6. The Debtor is authorized and shall make payments to the Lender to curtail the 

Lender’s claims for principal, interest, and expenses to the extent funds are available in 

accordance with the waterfall set forth in the Budget. 

7. Subject to the Carve-Out described in paragraph 8 below, if the Replacement Liens 

and the curtailment payments authorized in this Interim Order are insufficient to protect the 

Lender against any diminution in value of the Lender’s Collateral, then the Lender shall have an 

administrative expense claim allowable under Bankruptcy Code sections 507(b) and 503(b) 

having priority over all other costs and expenses of administration of any kind, which claim shall 

at all times be senior to the rights of the Debtor, or any successor trustee or estate representative in 

the Chapter 11 case of the Debtor. Any such claim provided to the Lender as referenced in this 

paragraph shall be referred to as the “Super-Priority Claim.” The Debtor reserves all rights to 

object to the allowance of any such Super-Priority Claim on any basis, including without 

limitation, that no diminution in value of the Lender’s Collateral has occurred. In addition to the 

foregoing, except as otherwise ordered by the Court and in compliance with the Budget, none of 

Lender’s Collateral may be used to make any payments with respect to any amounts owed as of 

the Petition Date, except for the payments to the Lender contemplated in paragraph 6 above. 

8. The Replacement Liens and the Super-Priority Claim, if allowed, shall be subject 

only to (i) the payment of any unpaid fees payable pursuant to 28 U.S.C. § 1930 and (ii) fees 

payable to the clerk of the Bankruptcy Court (collectively, the “Carve-Out”). 

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9. The Debtor shall provide the Lender and ULXP on a weekly basis a report of 

actual receipts and disbursements for the prior week compared to the Budget (a “Variance 

Report”). The Variance Report shall be provided on the second business day of each applicable 

week for the preceding week. 

10. Absent a subsequent order of the Court or an agreement between the Debtor and 

the Lender, the Debtor’s authorization to use cash collateral hereunder shall terminate upon the 

first to occur of 12:00 p.m. on October 4, 2019, or any of the following, provided that the Debtor 

shall be permitted to cure any of such events that is able to be cured within two (2) business days 

following such event: 

(a) two (2) business days after receipt of written notice from the Lender if the 

applicable Variance Report reflects that the aggregate amount of Total Operating 

Disbursements has exceeded the aggregate amount of Total Operating 

Disbursements in the Budget through the relevant week by seven percent (7%), 

provided that any payments to On-Site shall not be included in such calculations; 

(b) the Debtor files a pleading with the Court seeking an order to authorize the use of 

cash collateral inconsistent with this Interim Order or that seeks approval of a 

priming, senior, or pari passu security interest in or lien upon the Lender’s 

Collateral, and the proceeds of such financing would not result in the payment in 

full of the Lender, including without limitation all of Lender’s allowable interest, 

fees and expenses; 

(c) the filing by the Debtor of any pleading seeking to challenge the Lender’s liens or 

otherwise asserting rights, claims or causes of action against Lender;

(d) failure to timely provide a Variance Report; 

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(e) the dismissal of this chapter 11 case or the appointment of a chapter 11 trustee or 

examiner with expanded powers in this chapter 11 case; 

(f) termination of the Debtor’s exclusive right to file a chapter 11 plan; 

(g) reversal of this Interim Order through reconsideration or appeal; or 

(h) two (2) business days after receipt of written notice from the Lender if the Debtor 

fails to comply with the terms of this Interim Order. 

11. Except with respect to the payments to the Lender authorized in paragraph 6 

above, unless and until the Lender and/or ULXP receive additional and appropriate relief from 

this Court, neither the Lender nor ULXP shall offset, transfer, diminish, or otherwise draw down 

on any of the Debtor’s accounts and/or assets. In addition, no other creditor shall offset, transfer, 

diminish, or otherwise draw down on any of the Debtor’s accounts and/or assets absent express 

authority from the Debtor in accordance with the Budget or pursuant to a subsequent order of 

this Court. 

12. The automatic stay under Bankruptcy Code section 362(a) shall be, and hereby is, 

modified to the extent necessary to permit (i) the Lender to apply payments made pursuant to 

paragraph 6 above to curtail the Lender’s claims for principal, interest, and expenses and (ii) to 

send a notice and exercise any rights and remedies hereunder as set forth herein.

13. Nothing in this Interim Order or the Motion shall be construed as prejudicing the 

rights of the Debtor or any other party in interest to dispute or contest whether the Lender or 

ULXP has a valid perfected security interest in the cash collateral or any other property of the 

Debtor’s estate. 

14. The Lender and ULXP reserve the right to request further or different adequate 

protection for the period of time after the Debtor’s authorization to use cash collateral under this 

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Interim Order has terminated, and the Debtor or any other party may contest any such request. 

In addition, the Lender, ULXP, and the Debtor reserve all rights and defenses with respect to any 

further order or further relief pertaining to cash collateral. 

15. The Debtor is authorized and empowered to take all actions necessary to 

implement the relief granted in this Interim Order. 

16. The contents of the Motion and the notice procedures set forth in the Interim

Order Authorizing LeClairRyan PLLC to Use Cash Collateral, Granting Adequate Protection 

and Related Relief, and Scheduling a Final Hearing [Doc. No. 41] provided good and sufficient 

notice and satisfied Bankruptcy Rules 4001 and 9014 by providing parties with notice and an 

opportunity to object and be heard at a hearing. 

17. The requirement under Local Bankruptcy Rule 9013-1(G) to file a memorandum 

of law in connection with the Motion is hereby waived. 

18. Notwithstanding any Bankruptcy Rule (including, but not limited to, Bankruptcy 

Rule 6004(h)) or Local Bankruptcy Rule that might otherwise delay the effectiveness of this 

Interim Order, the terms and conditions of this Interim Order shall be immediately effective and 

enforceable upon its entry. 

19. This Court shall retain exclusive jurisdiction over any and all matters arising from 

or related to the implementation or interpretation of this Interim Order. 

Richmond, Virginia 

Dated: ______________________ ________________________________ 

 United States Bankruptcy Judge 

Sep 26 2019 /s/ Kevin R Huennekens

Entered on Docket: Sep 26 2019

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WE ASK FOR THIS: 

/s/ Tyler P. Brown 

Tyler P. Brown (VSB No. 28072) 

Jason W. Harbour (VSB No. 68220) 

HUNTON ANDREWS KURTH LLP 

Riverfront Plaza, East Tower 

951 East Byrd Street 

Richmond, VA 23219 

Tel: (804) 788-8200 

Fax: (804) 788-8218 

Email: tpbrown@HuntonAK.com 

jharbour@HuntonAK.com 

Proposed Counsel to the Debtor 

and Debtor in Possession 

CERTIFICATION OF ENDORSEMENT 

UNDER LOCAL BANKRUPTCY RULE 9022-1(C)

I hereby certify that the foregoing proposed order has been endorsed by or served 

upon all necessary parties. 

/s/ Tyler P. Brown

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EXHIBIT 1 

Budget

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