UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION

In re: COLLINS & AIKMAN CORPORATION, et al.1, Debtors.

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Case No. 05-55927 Chapter 11 Jointly Administered Honorable Steven W. Rhodes

MOTION OF SESCOI USA, INC. FOR ALLOWANCE OF ADMINISTRATIVE EXPENSE CLAIM UNDER 11 U.S.C. 503(b)(1)(A) By this motion, Sescoi USA, Inc. (Sescoi) seeks an order, pursuant to 11 U.S.C. 503(b)(1)(A) granting Sescoi an administrative expense priority claim in the amount of $31,680.00. In support of this motion, Sescoi states as follows: JURISDICTION 1. This Court has jurisdiction over this motion pursuant to 28 U.S.C. 157 and

1334. This matter is a core proceeding within the meaning of 28 U.S.C. 157(b)(2). 2. Venue in this district is proper under 28 U.S.C. 1409.

The Debtors in the proposed jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc.; Becker Group, LLC (d/b/a Collins & Aikman Premier Mold); Brut Plastics, Inc.; Collins & Aikman (Gibraltar) Limited; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation); Collins & Aikman Asset Services, Inc.; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.); Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.); Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.); Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.); Collins & Aikman Automotive International, Inc.; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.); Collins & Aikman Automotive Mats, LLC; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.); Collins & Aikman Automotive Services, LLC; Collins & Aikman Canada Domestic Holding Company; Collins & Aikman Carpet & Acoustics (MI), Inc.; Collins & Aikman Carpet & Acoustics (TN), Inc.; Collins & Aikman Development Company; Collins & Aikman Europe, Inc.; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.); Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.); Collins & Aikman Interiors, Inc.; Collins & Aikman International Corporation; Collins &.Aikman Plastics, Inc.; Collins & Aikman Products Co.; Collins & Aikman Properties, Inc.; Comet Acoustics, Inc.; CW Management Corporation; Dura Convertible Systems, Inc.; Gamble Development Company; JPS Automotive, Inc. (d/b/a PACJ, Inc.); New Baltimore Holdings, LLC; Owosso Thermal Forming, LLC; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.); Wickes Asset Management, Inc.; and Wickes Manufacturing Company.

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BACKGROUND 3. On May 17, 2005, (the Petition Date), the above captioned debtors filed

voluntary petitions for relief under chapter 11 of the United States Code (the Bankruptcy Code). 4. The First Amended Joint Plan (the Plan) of Collins & Aikman Corporation and

its debtor subsidiaries (collectively, Debtors) was confirmed on July 18, 2007. 5. Pursuant to Article III.A.1(c) of the Plan and 1129(a)(9)(A)of the Bankruptcy

Code, administrative claims will be paid in full. FACTUAL BACKGROUND 6. Prior to the Petition Date, Sescoi and the Debtors were parties to two WorkNC

Software License Agreements (the Licensing Agreements), in the form attached hereto as Exhibit B, and two WorkNC Software Maintenance Agreements2 (the Maintenance Agreements and, together with the Licensing Agreements, the Agreements), in the form attached hereto as Exhibit C, whereby Sescoi provides software and technical maintenance and support to the Debtors. 7. The Maintenance Agreements automatically renew for one year periods and require

the Debtors to pre-pay for services to be rendered during the contract term. 8. Pre and post-petition, Sescoi provided maintenance services under the Maintenance

Agreements to the Debtors. Debtors subsequently renewed the Maintenance Agreements in 2006 and, again, in 2007. 9. At issue in this motion is the March 18, 2005 payment, in the amount of $31,680

(the Contract Amount), for services to be rendered by Sescoi to Debtors from January 2005

Sescoi was only able to locate one of the Maintenance Agreements which is attached hereto as Exhibit C.

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through December 2005. It is undisputed that Sescoi fully performed under the terms of the Agreements. 10. On May 10, 2007, Debtors commenced an adversary proceeding alleging that

payment of the Contract Amount constitutes an avoidable transfer under 502(d), 547, 548 and 550 of the Bankruptcy Code. 11. To the extent that some or all of the Contract Amount is recoverable under 550 of

the Bankruptcy Code, Sescoi is entitled an administrative expense priority claim for the postpetition services provided by Sescoi to the Debtors throughout 2005. ARGUMENT A. SESCOI IS ENTITLED TO AN ADMINISTRATIVE EXPENSE PRIORITY CLAIM UNDER 503(b)(1)(A) OF THE BANKRUPTCY CODE. 12. Section 503(b)(1)(A) of the Bankruptcy Code provides for the allowance of an

administrative expense claim for "the actual, necessary costs and expenses of preserving the [debtor's] estate . . . rendered after the commencement of the case." 11 U.S.C. 503(b)(1)(A). A claimant seeking an administrative expense claim pursuant to section 503(b)(1)(A) of the Bankruptcy Code must satisfy a two prong test and show (i) that claimant gave consideration to the debtor-in-possession and (ii) that the consideration directly and substantially benefited the estate. See In re Mammoth Mart, Inc., 536 F.2d 950, 954 (1st Cir. 1976). Consideration is furnished to the estate only where the debtor-in-possession induces post-petition performance or where the performance on a contract not rejected by the debtor-in-possession is rendered to the estate. In re Section 20 Land Group, LTD, 261 B.R. 711, 716 (Bankr. M.D. Fla. 2000). 13. Subsequent to the Petition Date, Sescoi fully honored its obligations under the

Agreements. Post-petition and throughout 2005, at the request of Debtors, Sescoi continued to provide the Debtors with contractual services, including software updates and technical support

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and maintenance. By requesting and accepting these services from Sescoi, Debtors induced Sescoi to perform under the pre-petition Agreements. Because the Debtors induced Sescoi to perform under the contracts post-petition, and substantial services were rendered to the Debtors post-petition, Sescoi provided consideration to the Debtors. See Section 20 Land Group, LTD, 261 B.R. at 717 (Having induced IMG to perform and willingly accepted the benefits thereof, the Debtor is now estopped to deny that administrative claim status to IMG.) For these reasons, the services provided by Sescoi satisfy the first part of the test for allowance as an administrative expense priority claim. 14. Additionally, given that the Debtors willingly renewed the Agreements in 2006 and

2007, it is clear that the services provided by Sescoi directly and substantially benefited the estates. The post-petition services were actual, necessary costs and expenses to preserve the Debtors estates because these services protected the Debtors against any loss to the value of Debtors assets. Absent Sescoi's performance of software updates, technical support and

maintenance services, Debtors would have risked allowing its computer software to become inoperable or obsolete, which would have posed a significant financial risk to Debtors. As a result, the services provided by Sescoi satisfy the second part of the test for an administrative expense priority claim. B. THE AGREEMENTS DICTATE THAT SESCOI BE ENTITLED TO THE FULL CONTRACT AMOUNT. 15. To support recovery of the value of services provided by claimant, principles of

restitution require only that claimant establish that it rendered post-petition services pursuant to its pre-petition contract, without objection by the Trustee, and that the services had value to the estate. In re Monarch Capital Corporation, 163 B.R. 899, 907 (Bankr. D. Mass. 1994). The debtor in possession is obligated for the reasonable value of those services which, depending

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on the circumstances of a particular contract, may be what is specified in the contract. NLRB v. Bildisco, 465 U.S. 513, 531 (1984). Absent credible evidence to the contrary, the reasonable value awarded to the creditor will be the amount fixed by the contract. See Section 20 Land Group, LTD, 261 B.R. at 717 (where there is no evidence to indicate that the reasonable value of use and occupancy of the premises post-petition is anything other than that fixed in the underlying lease, the Court awarded the creditor the entire site fee plus post-petition expenses as established by the contract); In re Travel 2000, Inc., 264 B.R. 444, 450 (Bankr. W.D. Mich. 2001) (to get the benefit of the [of the lease] the [lessee] should be required to pay the full rent under the lease for every day that it continued to occupy the property after the bankruptcy filing). 16. The Agreements require that Sescoi is entitled to the full Contract Amount.

Regardless of Sescois time of performance, the Agreements specify that the pre-payment provided by Debtors is payment for services rendered for the entire one year term of each Agreement. In other words, Sescoi is entitled to payment in full regardless of when and how often Sescoi provides its software updates, technical support or maintenance services. In 2005, it is

clear that Sescoi provided services to Debtors post-petition at the request of Debtors. As such, regardless of whether some services were also rendered pre-petition, Sescoi would be and is entitled to the full Contract Amount. NOTICE 17. Notice of this motion has been given to (i) counsel for Debtors, (ii) counsel for the

Liquidating Agent, (iii) counsel for the Official Committee of Unsecured Creditors appointed in this case, (iv) Counsel for Plaintiff in the Adversary Proceeding, (v) the Office of the United States Trustee, and (vi) those parties who have requested service of all motions and pleadings in this case. In light of the relief requested herein, Sescoi submits that no further notice is necessary.

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CONCLUSION WHEREFORE, Sescoi respectfully requests that this Court enter an Order, substantially in the form attached hereto as Exhibit A, (i) granting it an administrative expense priority claim in the amount of $31,680.00; and (ii) granting any other such relief the Court deems just and appropriate. CLARK HILL PLC

Dated: November 8, 2007

/s/ Joel D. Applebaum Joel D. Applebaum (P36774) Shannon L. Deeby (P60242) japplebaum@clarkhill.com 500 Woodward Avenue, Suite 3500 Detroit, MI 48226-3435 (313) 965-8300 Attorneys for Defendant Sescoi USA, Inc.

By:

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