Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

1

Harrison A. Pavlasek

State Bar No. 24126906

FORSHEY & PROSTOK LLP

777 Main St., Suite 1550

Fort Worth, TX 76102

Telephone: 817-877-8855

Facsimile: 817-877-4151

hpavlasek@forsheyprostok.com

Proposed Attorneys for Debtor, M&G Transportation, 

LLC

Patrick W. Carothers (PA ID No. 85721)*

Gregory W. Hauswirth (PA ID No. 307482)*

Foster Plaza 10

680 Andersen Drive, Suite 230

Pittsburgh, PA 15220

Telephone: 412.910.7500

Facsimile: 412.910.7510

pcarothers@ch-legal.com

ghauswirth@ch-legal.com

*pro hac vice pending

Proposed Attorneys for Debtor, M&G Transportation, 

LLC

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE NORTHERN DISTRICT OF TEXAS

AMARILLO DIVISION

In re: 

M&G Transportation, LLC,

 Debtor.

)

)

)

)

)

)

Bankruptcy Case No. ______________

DEBTOR'S EMERGENCY MOTION FOR ENTRY OF AN ORDER AUTHORIZING

DEBTOR TO: (I) PAY PRE-PETITION ACCRUED EMPLOYEE WAGES, SALARIES 

AND EMPLOYEE COMPENSATION; AND (II) GRANTING RELATED RELIEF

TO THE HONORABLE ROBERT L. JONES, U.S. Bankruptcy Judge:

M&G Transportation, LLC (the "Debtor"), by and through its proposed undersigned 

counsel, hereby files this Emergency Motion For Entry of An Order Authorizing Debtor to: (I) Pay 

Pre-Petition Accrued Employee Wages, Salaries and Employee Compensation; and (II) Granting 

Related Relief (the "Motion"). In support of the Motion, Debtor relies upon and incorporates by 

reference the Declaration of Manuel Gutierrez in Support of Chapter 11 Petition and First Day 

Motions (the "Gutierrez Declaration"), and avers as follows:

JURISDICTION AND VENUE

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

2

1. On May 15, 2024 (the "Petition Date"), Debtor commenced this Chapter 11, 

Subchapter V bankruptcy case (this "Chapter 11 Case") through the filing of its voluntary petition 

for relief under chapter 11 of the United States Bankruptcy Code, 11 U.S.C §§ 101-1501 et seq. 

(the "Bankruptcy Code").

2. This matter is a core proceeding within the meaning of 28 U.S.C, § 157(b)(2)(A). 

Venue of this Chapter 11 Case in this district is proper under 28 U.S.C. §§ 1408 and 1409.

3. The statutory predicates for the relief requested herein are sections 105(a), 363, 

507(a)(4)-(5), 541, 1107(a) and 1108 of the Bankruptcy Code. Such relief is also warranted 

pursuant to Bankruptcy Rule of Procedure 6003.

BACKGROUND

4. Debtor remains in possession of its assets and continues to operate and manage its 

business as a "debtor-in-possession" pursuant to Subchapter V of the Bankruptcy Code.

5. Information regarding Debtor's history and business operations and events leading 

up to the commencement of this Chapter 11 Case is more fully described in the Gutierrez 

Declaration, which is contemporaneously filed with this Motion on the Petition Date and is 

incorporated herein by reference.

RELIEF REQUESTED

6. Debtor seeks the following authority from the Court, to exercise in its sole

discretion:

a. To honor and pay, when due, all prepetition wages, salaries, and any other prepetition employee compensation;

b. To pay Debtor’s share of applicable employment taxes in connection with the prepetition compensation;

c. To make all appropriate payroll deductions and to forward the deductions to the 

appropriate third parties; and

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

3

d. Debtor requests that all applicable banks and other financial institutions be 

authorized to receive, process, honor and pay all checks presented for payments 

and to honor all funds transfer requests made by Debtor related to such employee 

obligations, whether such checks were presented or funds transfer requests were 

submitted prior to or after the Petition Date (including checks that may have been 

presented and dishonored). 

7. Specifically, Debtor seeks approval for payment of earned compensation and 

benefits of Debtor’s entire workforce, which consists of approximately 25 full-time employees. 

Debtor’s workforce consists of non-union employees, and includes Manuel Gutierrez and German 

Gutierrez, the members of Debtor.

8. Debtor seeks authority to honor and pay various pre-petition wages and benefits 

that had not been issued or had not been cashed as of the Petition Date (the "Employee

Obligations"). Generally, Debtor pays the employees’ regular salary and wages one week in arrears 

on a weekly basis. In addition, to the extent any employee is entitled to earn overtime, overtime 

is paid on the same schedule. 

9. The "Pre-Petition Pay Period" would include (1) payroll for the pay cycle beginning 

May 4, 2024 and ending on May 10, 2024; and (2) the remaining payroll to be paid on May 24, 

2024 covering the pay period between May 11, 2024 and the Petition Date. Therefore, Debtor

estimates that the total amount of the Employee Obligations as of the Petition Date for the PrePetition Pay Period is approximately $59,500.00.

10. There are no employees who are currently owed, whether for the Pre-Petition Pay 

Period in excess of the statutory priority maximums under section 507(a)(4) of the Bankruptcy 

Code.

BASIS FOR RELIEF REQUESTED

A. Payment of the Employee Obligations Should be Authorized under Section 507(A) of 

the Bankruptcy Code.

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

4

11. Sections 507(a)(4) and 507(a)(5) require that certain claims for prepetition wages, 

salaries, and employee compensation are entitled to priority in payment in an amount not to exceed 

certain statutory caps. To that end, Debtor’s request for authority to pay these claims now merely 

constitutes a request to accelerate payment in order to avoid the devastation of employee morale 

and the operation of Debtor’s business. Further, the amount outstanding to any individual 

employee does not exceed the requisite statutory caps of sections 507(a)(4) and 507(a)(5) of the 

Bankruptcy Code.

12. Accordingly, granting the relief requested will not adversely affect Debtor’s other 

unsecured creditors.

B. The Proposed Payments are Appropriate under Section 363 of the Bankruptcy Code.

13. Under Section 363 of the Bankruptcy Code, this Court is empowered to authorize 

a chapter 11 debtor to expend funds in the bankruptcy court’s discretion outside of the ordinary 

course of business. See 11 U.S.C. § 363. In order to obtain approval for the use of the estate assets 

outside the ordinary course of business, Debtor must articulate a valid business justification for 

the requested use. See In re Ionosphere Clubs, Inc., 98 BR, 174, 175 (Bankr. S.D. N.Y 1989). The 

preservation and protection of a debtor’s business, the retention of a debtor’s current working 

employees and the maintenance of positive employee morale provide a sufficient business 

justification for payment of prepetition wage, salary and benefit claims, even if such payment was 

deemed to be outside the ordinary course of business. See Id.

14. Accordingly, this Court should grant the relief requested under section 363 of the 

Bankruptcy Code.

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

5

C. The Court Has Authority Pursuant to Bankruptcy Code Section 105(a) to Grant the 

Relief Requested.

15. Pursuant to section 105(a) of the Bankruptcy Code, "the court may issue any order, 

process, or judgment that is necessary or appropriate to carry out the provisions of this title." 11 

U.S.C. § 105(a). Section 105(a) of the Bankruptcy Code codifies the bankruptcy court’s inherent 

broad equitable powers.

16. It is generally recognized that the continuation of a stable employee base and

harmonious employee relations in operating a chapter 11 case is critical to a successful

reorganization. As the court noted in In re Chateaugay Corporation (LTV Corporation v. Aetna),

116 B.R. 887, 898 (Bankr. S.D.N.Y. 1990):

[E]mployee good will and contentment is an asset which is vital to 

the continuation of a debtor’s business operations and its ability to 

effectively reorganize during the chapter 11 process. In granting 

debtor’s applications for permission to provide hardship payments 

to injured workers, this court determined that the uninterrupted 

payment of LTV steel workers’ compensation obligations is 

essential to employee morale and industrial tranquility which, in 

turn, are critical to a successful reorganization. 

Id.

17. Similarly, in In re Gulf Air, Inc., 112 B.R. 152, 153 (Bankr. W.D. LA. 1989), the 

court endorsed the payment of pre-petition employee wage claims because "retention of skills, 

organization and reputation for performance must be considered valuable assets contributing to 

going concern value and aiding rehabilitation where that is possible."

18. The Bankruptcy Code affords special treatment to certain pre-petition claims of

employees. Compared to a typical claim in bankruptcy, wages represent a large portion of an

employee’s wealth and economic well-being. In addition, unlike an ordinary trade creditor, the

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

6

typical employee does not have other sources of income and thus cannot diversify the risk of the 

employer’s default. Employees’ wages are essential in providing the basic necessities for the living 

expenses of employees and their families including housing, food and transportation costs.

19. Accordingly, this Court should grant the relief requested under section 105(a) of 

the Bankruptcy Code.

D. Debtor Requests Authority for Debtor’s Bank to Honor Checks and Transfer Related 

to Employee Obligations and Maintenance of Payroll Accounts.

20. Finally, Debtor requests that all applicable banks and other financial institutions be 

authorized to receive, process, honor and pay all checks presented for payments and to honor all 

funds transfer requests made by Debtor related to Employee Obligations, whether such checks 

were presented or funds transfer requests were submitted prior to or after the Petition Date 

(including checks that may have been presented and dishonored).

NOTICE

21. Notice of this Motion shall be provided to the following parties or, in lieu thereof, 

to their counsel, if known: (i) Office of the United States Trustee; (ii) Triumph Financial Services, 

LLC; (iii) United States Internal Revenue Service; and (iv) the twenty (20) largest unsecured 

creditors of Debtor. Debtor submits that, in light of the relief requested, no other or further notice 

need be provided.

NO PRIOR REQUEST

22. No prior motion for the relief requested herein has been made to this or any other 

Court.

CONCLUSION

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

7

WHEREFORE, Debtor requests entry of an Order granting the relief requested herein and 

such other and further relief as is just and proper.

Date: May 15, 2024 Respectfully submitted,

CAROTHERS & HAUSWIRTH LLP

/s/ Gregory W. Hauswirth

Patrick W. Carothers (PA ID No. 85721)*

Gregory W. Hauswirth (PA ID No. 307482)*

Foster Plaza 10

680 Andersen Drive, Suite 230

Pittsburgh, PA 15220

Telephone: 412.910.7500

Facsimile: 412.910.7510

pcarothers@ch-legal.com

ghauswirth@ch-legal.com

*pro hac vice pending

Proposed Attorneys for Debtor, M&G 

Transportation, LLC

-andFORSHEY & PROSTOK LLP

/s/ Harrison A. Pavlasek

Harrison A. Pavlasek

State Bar No. 24126906

777 Main St., Suite 1550

Fort Worth, TX 76102

Telephone: 817-877-8855

Facsimile: 817-877-4151

hpavlasek@forsheyprostok.com

Proposed Attorneys for Debtor, M&G 

Transportation, LLC

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Debtor's Emergency Motion for Entry of an Order Authorizing 

Debtor to (I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

8

CERTIFICATE OF CONFERENCE

As of May 15, 2024, counsel for Debtor was able to confer as follows:

1. Counsel for Debtor was able to speak with counsel for Triumph Financial Services, LLC 

and such creditor does not oppose the relief requested in the Motion. 

2. Counsel for Debtor was able to speak with representatives of the Internal Revenue Service 

(Revenue Officer Rasheedah Cherry and Advisory Representative Billy Brooks) who did 

not take a position on the motion. Counsel for the Internal Revenue Service was not 

available to speak on the Motion.

3. Additionally, due to the emergency nature of this filing and the infancy of this bankruptcy 

case, the undersigned counsel has not been able to speak with counsel for trial attorneys 

for the Office of the U.S. Trustee for Region 6. At this time, counsel does not know the 

position of the Office of the U.S. Trustee for Region 6 with respect to the relief requested 

in the Motion. 

/s/ Gregory W. Hauswirth

Gregory W. Hauswirth

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Order Granting Debtor's Emergency Motion For Authority to 

(I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

1

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE NORTHERN DISTRICT OF TEXAS

AMARILLO DIVISION

In re: 

M&G Transportation, LLC,

 Debtor.

)

)

)

)

)

)

Bankruptcy Case No. ____________

ORDER GRANTING DEBTOR’S EMERGENCY 

MOTION FOR AUTHORITY TO (I) PAY PRE-PETITION 

ACCRUED EMPLOYEE WAGES, SALARIES AND EMPLOYEE 

COMPENSATION; AND (II) RELIEF RELATED TO THE FOREGOING

Upon consideration of the Emergency Motion for an Order Authorizing Debtor to: (1) Pay 

Pre-Petition Accrued Employee Wages, Salaries and Any Other Pre-Petition Employee 

Compensation; and (2) Relief Related to the Foregoing (the "Motion"),1it is hereby ORDERED: 

1 Terms not otherwise defined herein shall have the meaning ascribed to them in the Motion.

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Order Granting Debtor's Emergency Motion For Authority to 

(I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

2

1. The Motion is GRANTED upon the terms set forth herein.

2. Debtor is authorized, but not directed, in the ordinary course of business and in accordance 

with Debtor's standard policies and prepetition practices, (a) to honor and pay all 

prepetition wages, salaries, benefits and any other pre-petition employee compensation; (b) 

honor and pay Debtor's share of applicable employment taxes in connection with the prepetition compensation; and (c) to make all appropriate payroll deductions and to forward 

the deductions to the appropriate third parties, in an amount not to exceed $59,500.00 (the 

"Pre-Petition Payroll"). 

3. Debtor is authorized to pay the Pre-Petition Payroll as set forth above, subject to the 

limitations contained in sections (507)(a)(4) and (a)(5) of the Bankruptcy Code.

4. The requirements set forth in Bankruptcy Rule 6003(b) are satisfied or otherwise deemed 

waived. 

5. Notwithstanding the possible application of Bankruptcy Rules 6004(h), 9014 or otherwise, 

the terms and conditions of this Order shall be immediately effective and enforceable upon 

its entry and is not stayed. 

6. The entry of this Order is without prejudice to: (i) Office of the United States Trustee; and 

(ii) any creditor of Debtor's estate to file an objection to the Motion or this Order within 

thirty (30) days of the date hereof.

7. Debtor's payment of the Pre-Petition Payroll remains subject to any valid objection filed 

by a party identified in Paragraph 6 herein. If the Court determines such objection to be 

valid, Debtor shall be responsible for pursuing and recovering the Pre-Petition Payroll from 

its employees. 

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Order Granting Debtor's Emergency Motion For Authority to 

(I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

3

8. To the extent Debtor's bankruptcy estate is determined to be administratively insolvent, all 

parties' rights are expressly reserved to seek disgorgement of the Pre-Petition Payroll from 

Debtor's employees. 

9. Nothing contained in this Order shall require or should be construed to create an 

administrative priority claim on account of obligations owing to Debtor's employees for 

services performed pre-petition. 

10. Nothing in the Motion or this Order, nor as a result of Debtor's payment of the Pre-Petition 

Payroll pursuant to this Order, shall be deemed or construed as a waiver of the right of 

Debtor, or any other party in interest, or shall impair the ability of Debtor, or any other 

party in interest, to contest the validity and amount of any payment made pursuant to this 

Order. 

11. Debtor is authorized and empowered to take all actions necessary to implement the relief 

granted in this Order. 

12. The Court shall retain jurisdiction to enforce, modify, extend or interpret this Order.

###End of Order ###

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Order Granting Debtor's Emergency Motion For Authority to 

(I) Pay Pre-Petition Accrued Employee Wages, Salaries 

and Employee Compensation; and (II) Granting Related Relief

4

Order Submitted by:

CAROTHERS & HAUSWIRTH LLP

/s/ Gregory W. Hauswirth

Patrick W. Carothers (PA ID No. 85721)*

Gregory W. Hauswirth (PA ID No. 307482)*

Foster Plaza 10

680 Andersen Drive, Suite 230

Pittsburgh, PA 15220

Telephone: 412.910.7500

Facsimile: 412.910.7510

pcarothers@ch-legal.com

ghauswirth@ch-legal.com

*pro hac vice pending

Proposed Attorneys for Debtor, M&G Transportation, LLC

-andFORSHEY & PROSTOK LLP

/s/ Harrison A. Pavlasek

Harrison A. Pavlasek

State Bar No. 24126906

777 Main St., Suite 1550

Fort Worth, TX 76102

Telephone: 817-877-8855

Facsimile: 817-877-4151

hpavlasek@forsheyprostok.com

Proposed Attorneys for Debtor, M&G Transportation, LLC

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