Case 8:10-bk-16743-TA

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RON BENDER (SBN 143364) TODD M. ARNOLD (SBN 221868) LEVENE, NEALE, BENDER, YOO & BRILL L.L.P. 10250 Constellation Boulevard, Suite 1700 Los Angeles, California 90067 Telephone: (310) 229-1234; Facsimile: (310) 229-1244 Email: rb@lnbyb.com; tma@lnbyb.com Attorneys for Chapter 11 Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA SANTA ANA DIVISION In re: ) ) WESTCLIFF MEDICAL ) LABORATORIES, INC., ) ) Debtor. ____________________________________ ) ) In re: ) ) BIOLABS, INC., ) ) Debtors. ____________________________________ ) ) ) Affects All Debtors ) Affects Westcliff Medical Laboratories, ) ) Inc. only ) ) Affects Biolabs, Inc. only ) Lead Case No. 8:10-bk-16743-TA (Jointly Administered with Case No. 8:10-bk-16746-TA) Chapter 11 STIPULATION BETWEEN DEBTORS AND CYNTHIA WESBY FOR RELIEF FROM THE AUTOMATIC STAY

Westcliff Medical Laboratories, Inc. (Westcliff) and Biolabs, Inc. (Biolabs and, 24 together with Westcliff, the Debtors) and Cynthia Wesby (the Plaintiff), by and through their 25 respective undersigned counsel, hereby enter into this stipulation (the Stipulation) based on the 26 27 28 following recitals of fact:

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RECITALS On May 19, 2010, each of the Debtors commenced a voluntary case under

Chapter 11 of 11 U.S.C. 101 et seq. of the United States Code (the Bankruptcy Code) in the United States Bankruptcy Court for the Central District of the State of California (the Bankruptcy Court). B. On or about February 26, 2010, Plaintiff commenced an action against Westcliff

in the California Superior Court for the County of Orange, case number 00342421 (the State Action). By way of the State Action, the Plaintiff is seeking to recover damages on alleged claims for labor code violations, unfair business practices, negligent infliction of emotional distress, and wrongful termination in violation of public policy (the State Action Claims). C. Pursuant to section 362 of the Bankruptcy Code, the State Action is subject to an

automatic stay due to the commencement of Westcliffs bankruptcy case. On or about June 10, 2010, the Plaintiff filed Proof of Claim No. 42 in Westcliffs

bankruptcy case asserting a claim in the amount of $75,000 (Claim No. 42). E. Westcliff may have had insurance in place at the time of the alleged conduct

forming the basis for the State Action Claims and Claim No. 42 insuring against such claims. F. The parties hereto desire minimize the expense and inconvenience to the

Bankruptcy Court that would be associated with a motion for relief from the automatic stay and/or litigating the State Action Claims and Claim No. 42 and to resolve the issues among the parties. Therefore, the parties have agreed, subject to the approval of the Bankruptcy Court to relief from the automatic stay on the terms and conditions set forth below. STIPULATION NOW THEREFORE, the parties, by and through their undersigned counsel, do hereby agree as follows: 1. Upon entry of the order of the Bankruptcy Court approving this Stipulation, the

automatic stay imposed under Section 362 of the Bankruptcy Code shall be modified to the limited extent necessary to enable (a) the State Action to proceed to final judgment or settlement; and (b) the Plaintiff to attempt to recover any liquidated final judgment or settlement with

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respect to the State Action from any available insurance. 2. Upon entry of the order of the Bankruptcy Court approving this Stipulation, the

Plaintiff shall be deemed to have waived (a) Claim No. 42, and (b) the right to recover any amounts from the Debtors or their Bankruptcy estates. The Plaintiffs recovery on any alleged claims against the Debtors shall be limited to available insurance proceeds. 3. Nothing contained herein shall be deemed an admission to liability by the Debtors

or the insurance carrier with respect to the State Action. 4. The Bankruptcy Court shall retain jurisdiction and shall be the exclusive forum to

resolve any disputes or controversies arising from or relating to this Stipulation. 5. 6. This Stipulation is subject to the approval of the Bankruptcy Court. This Stipulation sets forth the entire understanding of the Parties and may not be

amended or modified except in a writing signed by the parties and approved by the Bankruptcy Court. 13 7. 14 15 16 17 18 19 20 21 Dated: November 8, 2011 22 23 24 25 26 27 28 Dated: September 27, 2011 The Parties represent and warrant to each other that the signatories to this Stipulation have the full power and authority to enter into this Stipulation and to bind the Parties. 8. This Stipulation may be executed in counterparts each of which shall be deemed

an original but all of which together shall constitute one and the same instrument. This Stipulation may be executed by facsimile or PDF signatures, and such facsimile or PDF signatures will be deemed to be as valid as an original whether or not confirmed by delivering the original signatures in person. SO STIPULATED.

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NOTE: When using this form to indicate service of a proposed order, DO NOT list any person or entity in Category I. Proposed orders do not generate an NEF because only orders that have been entered are placed on the CM/ECF docket.

PROOF OF SERVICE OF DOCUMENT

I am over the age of 18 and not a party to this bankruptcy case or adversary proceeding. My business address is: 10250 Constellation Boulevard, Suite 1700, Los Angeles, CA 90067 A true and correct copy of the foregoing document described as STIPULATION BETWEEN DEBTORS AND CYNTHIA WESBY FOR RELIEF FROM THE AUTOMATIC STAY will be served or was served (a) on the judge in chambers in the form and manner required by LBR 5005-2(d); and (b) in the manner indicated below: I. TO BE SERVED BY THE COURT VIA NOTICE OF ELECTRONIC FILING (NEF) Pursuant to controlling General Order(s) and Local Bankruptcy Rule(s) (LBR), the foregoing document will be served by the court via NEF and hyperlink to the document. On November 8, 2011, I checked the CM/ECF docket for this bankruptcy case or adversary proceeding and determined that the following person(s) are on the Electronic Mail Notice List to receive NEF transmission at the email address(es) indicated below: Raymond G Alvarado ralvarado@adorno.com Todd M Arnold tma@lnbrb.com Phillip Ashman mgolod@mcqueenashman.com, pashman@mcqueenashman.com;bkumamoto@mcqueenashman.com Richard L Barnett rick@barnettrubin.com, rlbsec@barnettrubin.com Ron Bender rb@lnbrb.com Ronald K Brown rkbgwhw@aol.com Jennifer Witherell Crastz jcrastz@hemar-rousso.com Carol J Fogleman mfrost@bwslaw.com Anthony A Friedman aaf@lnbrb.com John-patrick M Fritz jpf@lnbrb.com Jeffrey K Garfinkle bkgroup@buchalter.com, jgarfinkle@buchalter.com;lgoodwin@buchalter.com Fredric Glass fglass@fairharborcapital.com Nancy S Goldenberg nancy.goldenberg@usdoj.gov D Edward Hays ehays@marshackhays.com Michael J Heyman michael.heyman@klgates.com Mark D Houle mark.houle@pillsburylaw.com Jacqueline L James jlj@lnbyb.com Jeff D Kahane jkahane@duanemorris.com Andy Kong Kong.Andy@ArentFox.com Rodger M Landau rlandau@lgbfirm.com, kmoss@lgbfirm.com Matthew A Lesnick matt@lesnicklaw.com Michael B Lubic michael.lubic@klgates.com Frank F McGinn ffm@bostonbusinesslaw.com Elissa Miller emiller@sulmeyerlaw.com, asokolowski@sulmeyerlaw.com Aram Ordubegian ordubegian.aram@arentfox.com Ernie Zachary Park ernie.park@bewleylaw.com Richard Park Richard.Park@usdoj.gov Justin E Rawlins jrawlins@winston.com, docketla@winston.com Benjamin Seigel bseigel@buchalter.com, IFS_filing@buchalter.com David B Shemano dshemano@pwkllp.com Philip E Strok pstrok@wgllp.com United States Trustee (SA) ustpregion16.sa.ecf@usdoj.gov Howard J Weg hweg@pwkllp.com

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Sharon Z Weiss sharon.weiss@hro.com Joseph M Welch jwelch@buchalter.com Johnny White , seb@blakeleyllp.com;bblakeley@blakeleyllp.com;rclifford@blakeleyllp.com Service information continued on attached page

II. SERVED BY U.S. MAIL (indicate method for each person or entity served): On November 8, 2011, I served the following person(s) and/or entity(ies) at the last known address(es) in this bankruptcy case or adversary proceeding by placing a true and correct copy thereof in a sealed envelope in the United States Mail, first class, postage prepaid, and/or with an overnight mail service addressed as follows. Listing the judge here constitutes a declaration that mailing to the judge will be completed no later than 24 hours after the document is filed.

Hon. Theodor Albert United States Bankruptcy Court 411 West Fourth Street Santa Ana, CA 92701

Keith F. Simpson Law offices of Keith F. Simpson A Professional Corporation 1230 Rosecrans Avenue, Suite 170 Manhattan Beach, CA 90266 Service information continued on attached page

III. SERVED BY PERSONAL DELIVERY, FACSIMILE TRANSMISSION OR EMAIL (indicate method for each person or entity served): Pursuant to F.R.Civ.P. 5 and/or controlling LBR, on November 8, 2011, I served the following person(s) and/or entity(ies) by personal delivery, or (for those who consented in writing to such service method), by facsimile transmission and/or email as follows. Listing the judge here constitutes a declaration that personal delivery on the judge will be completed no later than 24 hours after the document is filed. Service information continued on attached page I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. November 8, 2011 Date Lourdes Cruz Type Name /s/ Lourdes Cruz Signature

This form is mandatory. It has been approved for use by the United States Bankruptcy Court for the Central District of California.

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August 2010

F 9013-3.1.PROOF.SERVICE