COOLEY LLP 1114 Avenue of the Americas New York, New York 10036 Telephone: (212) 479-6000 Facsimile:

(212) 479-6275 Cathy Hershcopf Jeffrey L. Cohen Alex R. Velinsky Proposed Attorneys for Debtor and Debtor in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------In re METROPARK USA, INC., Debtor. ----------------------------------------------------------------

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Chapter 11 Case No. 11-______ (RDD)

MOTION FOR AN ORDER, PURSUANT TO SECTIONS 105(a) AND 331 OF THE BANKRUPTCY CODE AND BANKRUPTCY RULE 2016(a), ESTABLISHING PROCEDURES FOR INTERIM MONTHLY COMPENSATION AND REIMBURSEMENT OF EXPENSES OF PROFESSIONALS TO THE HONORABLE ROBERT D. DRAIN, UNITED STATES BANKRUPTCY JUDGE: Metropark USA, Inc., as debtor and debtor in possession (the Debtor),1 respectfully represents: BACKGROUND General 1. On the date hereof (the Petition Date), the Debtor commenced with this Court a

voluntary case under chapter 11 of title 11 of the United States Code (the Bankruptcy Code). The Debtor is authorized to operate its businesses and manage its properties as debtor in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee,

examiner, or statutory creditors committee has been appointed in this chapter 11 case.
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The last four digits of the Debtors federal tax identification number are 6659.

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The Debtors Business 2. Metropark was founded in 2004 to capitalize on the large Gen Y segment (the

25-35 year old customer) who had moved on from teen retailers, but were still looking for fashion-forward apparel and accessories. Through a multi-channel sales strategy, including sales through brick-and-mortar stores and e-commerce, Metropark caters to trendsetting young adult customers by offering a unique and highly differentiated merchandise assortment introducing a Fashion, Music, Art philosophy into the marketplace. 3. Since its founding in 2004, Metropark has grown rapidly from its four original

store locations to approximately 70 stores in 21 states, in addition to its newly redesigned online retail presence at www.metroparkusa.com. Metropark offers its customers a unique mix of premium quality apparel and accessories geared toward the 25-35 year old trendsetter. The Metropark retail stores provide a truly unique experiential lifestyle shopping environment including, style consultants, in-store events (e.g. live art installations, fashion shows and DJ performances) and a carefully edited inventory assortment of highly sought after brands with a strong offering of up and coming, fashion forward designer talent to deliver an authentic and culturally relevant mix of diverse brands to the customer. 4. As a result of several internal and external factors, the Debtor faced

extraordinary liquidity constraints in the first quarter of 2011. Because of this reality, the Debtor spent the better part of the first quarter of 2011 trying to identify a financial partner to provide an equity infusion, debt investment or otherwise stabilize the financial wherewithal of the Company. Unfortunately, a transaction in the best interest of the Company, its creditors and its shareholders was not available outside of chapter 11 and the Company has reached the end of its liquidity runway. Accordingly, the Debtor has determined that the commencement of this case would provide the sole opportunity to, among other things, sell substantially all of the assets of the Debtor as a going concern or liquidation and, if successful in identifying a going

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concern buyer, right-size the Debtors business through (i) the evaluation and elimination of liabilities that serve as a drain on the Debtors profitability, and (ii) operational improvements. JURISDICTION 5. This Court has jurisdiction to consider this matter pursuant to 28 U.S.C. 157

and 1334. This is a core proceeding pursuant to 28 U.S.C. 157(b). Venue is proper before this Court pursuant to 28 U.S.C. 1408 and 1409. RELIEF REQUESTED 6. The Debtor requests, pursuant to sections 105(a) and 331 of the Bankruptcy

Code and Bankruptcy Rule 2016(a), entry of an order establishing an orderly, regular process for the monthly allowance and payment of compensation and reimbursement of expenses for professionals whose services are authorized by this Court pursuant to sections 327 or 1103 of the Bankruptcy Code and who will be required to file applications for allowance of compensation and reimbursement of expenses pursuant to sections 330 and 331 of the Bankruptcy Code and Bankruptcy Rule 2016(a). In addition, the Debtor seeks approval of a procedure for

reimbursement of reasonable out-of-pocket expenses incurred by members of any committee appointed in this case. Retention Of Professionals 7. By separate applications filed contemporaneously herewith, the Debtor is

seeking authority to employ Cooley LLP as counsel to represent it in this chapter 11 case and CRG Group Partners, LLC as financial advisors. The Debtor may need to retain additional professionals in connection with the continued prosecution of this chapter 11 case. Proposed Compensation & Reimbursement Procedures 8. Pursuant to section 331 of the Bankruptcy Code, all retained professionals are

entitled to submit applications for interim compensation and reimbursement of expenses every 120 days, or more often if the Court permits. Section 331 of the Bankruptcy Code provides, in part, as follows: 3
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A trustee, an examiner, a debtors attorney, or any professional person employed under section 327 or 1103 of this title may apply to the court not more than once every 120 days after an order for relief in a case under this title, or more often if the court permits, for such compensation for services rendered before the date of such an application or reimbursement for expenses incurred before such date as is provided under section 330 of this title. 11 U.S.C. 331. Section 105(a) of the Bankruptcy Code authorizes the court to issue any order that is necessary or appropriate to carry out the provisions of [the Bankruptcy Code]. 11 U.S.C. 105(a). Thus, the Court has ample authority to enter an order authorizing the interim monthly compensation and reimbursement of expenses procedures requested herein. 9. The Debtor seeks approval of procedures that are in accordance with standing

General Order M-412 of the Bankruptcy Court for the Southern District of New York, establishing procedures for monthly compensation and reimbursement of expenses of professionals, and pursuant to sections 105(a) and 331 of the Bankruptcy Code and Bankruptcy Rule 2016(a). 10. The Debtor proposes that the payment of compensation and reimbursement of

expenses of professionals be structured as follows: (a) On or before the twentieth (20th) day of each month following the month for which compensation is sought, each professional seeking compensation under this Order shall serve a monthly statement (Monthly Fee Statement), by hand or overnight delivery on: (i) the Debtor, 5750 Grace Place, Los Angeles, California (Attn: Rick Hicks); (ii) counsel to the Debtor, Cooley LLP, 1114 Avenue of the Americas, New York, NY 10036 (Attn: Jeffrey L. Cohen, Esq.); (iii) counsel to all official committees; (iv) counsel for the Office of the United States Trustee, 33 Whitehall Street, 21st Floor, New York, New York 10004 (Attn: Susan Golden); (v) counsel to Wells Fargo Bank, N.A., Riemer & Braunstein LLP, 3 Center Plaza, Boston, Massachusetts 02108 (Attn: Donald E. Rothman), and (vi) Solomon Ward Seidenwurm & Smith, LLP, 401 B Street, Ste. 1200 San Diego, CA 92101 (Attn: Michael D. Breslauer, Esq.) as counsel to Bricoleur Capital Partners, LP in its capacity as second lien agent (collectively, the Notice Parties); (b) On or before the twentieth (20th) day of each month following the month for which compensation is sought, each professional seeking compensation shall file a Monthly Fee Statement with the Court; however, a courtesy copy need not be delivered to the Judges chambers. This Motion is not intended to alter the fee application requirements outlined in 330 and 331 of the Code. Professionals are still required to serve and file interim and final applications for approval of 4
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fees and expenses in accordance with the relevant provisions of the Code, the Federal Rules of Bankruptcy Procedure and the Local Rules for the United States Bankruptcy Court, Southern District of New York; (c) Each Monthly Fee Statement must contain a list of the individuals and their respective titles (e.g., attorney, accountant, or paralegal) who provided services during the statement period, their respective billing rates, the aggregate hours spent by each individual, a reasonably detailed breakdown of the disbursements incurred (no professional should seek reimbursement of an expense which would otherwise not be allowed pursuant to the Courts Administrative Orders dated June 24, 1991 and April 21, 1995 or the United States Trustee Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. 330 dated January 30, 1996), and contemporaneously maintained time entries for each individual in increments of tenths (1/10) of an hour; (d) If any party in interest has an objection to the compensation or reimbursement sought in a particular Monthly Fee Statement, such party shall, by no later than the thirty-fifth (35th) day following the month for which compensation is sought, file with the Court and serve upon the professional whose Monthly Fee Statement is objected to, and the other persons designated to receive statements in paragraph (a), a written Notice Of Objection To Fee Statement, setting forth the nature of the objection and the amount of fees or expenses at issue; (e) At the expiration of the thirty-five (35) day period, the Debtor shall promptly pay eighty percent (80%) of the fees and one hundred percent (100%) of the expenses identified in each Monthly Fee Statement to which no objection has been served in accordance with paragraph (d); (f) If a Notice Of Objection To Fee Statement is filed, the Debtor shall withhold payment of that portion of the Monthly Fee Statement to which the objection is directed and promptly pay the remainder of the fees and disbursements in the percentages set forth in paragraph (e) unless the professional whose statement is objected to seeks an order from the Court, upon notice and a hearing, directing payment to be made; (g) If the parties to an objection are able to resolve their dispute following the filing of a Notice of Objection to Fee Statement and if the party whose Monthly Fee Statement was objected to files a statement indicating that the objection is withdrawn and describing in detail the terms of the resolution, then the Debtor shall promptly pay, in accordance with paragraph (e), that portion of the Monthly Fee Statement which is no longer subject to an objection; (h) All objections that are not resolved by the parties or Court order, shall be preserved and presented to the Court at the next interim or final fee application hearing to be heard by the Court (see paragraph (j), below); (i) The service of an objection in accordance with paragraph (d) shall not prejudice the objecting partys right to object to any fee application made to the Court in accordance with the Code on any ground whether raised in the objection or not. Furthermore, the decision by any party not to object to a Monthly Fee 5
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Statement shall not be a waiver of any kind or prejudice that partys right to object to any fee application subsequently made to the Court in accordance with the Code; (j) Approximately every 120 days, but no more than every 150 days, each of the professionals shall serve and file with the Court an application for interim or final Court approval and allowance, pursuant to sections 330 and 331 of the Bankruptcy Code (as the case may be), of the compensation and reimbursement of expenses requested; (k) Any professional who fails to file an application seeking approval of compensation and expenses previously paid under this Order when due shall (1) be ineligible to receive further monthly payments of fees or expenses as provided herein until further order of the Court, and (2) may be required to disgorge any fees paid since retention or the last fee application, whichever is later; (l) The pendency of an application or a Court order that payment of compensation or reimbursement of expenses was improper as to a particular statement shall not disqualify a professional from the future payment of compensation or reimbursement of expenses as set forth above, unless otherwise ordered by the Court; (m) Neither the payment of, nor the failure to pay, in whole or in part, monthly compensation and reimbursement as provided herein shall have any effect on this Courts interim or final allowance of compensation and reimbursement of expenses of any professionals; (n) Counsel for each official committee may, in accordance with the foregoing procedure for monthly compensation and reimbursement of professionals, collect and submit statements of expenses, with supporting vouchers, from members of the committee he or she represents; provided, however, that such committee counsel ensures that these reimbursement requests comply with this Courts Administrative Orders dated June 24, 1991 and April 21, 1995; 11. The proposed procedures will enable the Debtor to closely monitor the costs of

administration, forecast cash flows, and implement efficient cash management procedures. Moreover, these procedures will also allow the Court and the key parties in interest, including the U.S. Trustee, to ensure the reasonableness and necessity of the compensation and reimbursement sought pursuant to such procedures. NOTICE 12. The Debtor has served notice of this Application on (i) the U.S. Trustee (Attn:

Susan Golden, Esq.), (ii) Riemer & Braunstein LLP, Three Center Plaza, Boston, MA 02108 (Attn: Donald E. Rothman, Esq.) as counsel for Wells Fargo Bank, N.A., (iii) Solomon Ward 6
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Seidenwurm & Smith, LLP, 401 B Street, Ste. 1200 San Diego, CA 92101 (Attn: Michael D. Breslauer, Esq.) as counsel to Bricoleur Capital Partners, LP in its capacity as second lien agent, and (iv) the Debtors 30 largest unsecured creditors. In light of the nature of the relief requested, the Debtor submits that no other or further notice need be provided. 13. No previous request for the relief sought herein has been made by the Debtor to

this or any other court. WHEREFORE, the Debtor respectfully requests that the Court grant the relief requested herein and such other and further relief as is just and appropriate. Dated: May 2, 2011 New York, New York Respectfully submitted,

By:

/s/ Cathy Hershcopf Cathy Hershcopf

COOLEY LLP 1114 Avenue of the Americas New York, New York 10036 Telephone: (212) 479-6000 Facsimile: (212) 479-6275 Cathy Hershcopf (CH 5875 Jeffrey L. Cohen (JC 2556) Alex R. Velinsky (AV 1012) Proposed Attorneys for Debtor and Debtor in Possession

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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------In re METROPARK USA, INC., Debtor. ----------------------------------------------------------------

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Chapter 11 Case No. 11-______ (RDD)

ORDER PURSUANT TO SECTIONS 105(a) AND 331 OF THE BANKRUPTCY CODE AND BANKRUPTCY RULE 2016(a) ESTABLISHING PROCEDURES FOR INTERIM MONTHLY COMPENSATION AND REIMBURSEMENT OF EXPENSES OF PROFESSIONALS Upon the motion, dated May 2, 2011 (the Motion),1 of Metropark USA, Inc., as debtor and debtor in possession (the Debtor),2 for an order pursuant to sections 105(a) and 331 of the Bankruptcy Code and Rule 2016(a) of the Federal Rules of Bankruptcy Procedure establishing procedures for interim monthly compensation and reimbursement of expenses of professionals, all as more fully set forth in the Motion; and the Court having jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. 157 and 1334 and the Standing Order of Referral of Cases to Bankruptcy Judges of the District Court for the Southern District of New York, dated July 19, 1984 (Ward, Acting C.J.); and consideration of the Motion and the relief requested therein being a core proceeding pursuant to 28 U.S.C. 157(b); and venue being proper before this Court pursuant to 28 U.S.C. 1408 and 1409; and due and proper notice of the Motion having been provided to (i) the U.S. Trustee (Attn: Susan Golden, Esq.), (ii) Riemer & Braunstein LLP, Three Center Plaza, Boston, MA 02108 (Attn: Donald E. Rothman, Esq.) as counsel for Wells Fargo Bank, N.A., (iii) Solomon Ward Seidenwurm & Smith, LLP, 401 B Street, Ste. 1200 San Diego, CA 92101 (Attn: Michael D. Breslauer, Esq.) as counsel to Capitalized terms used but not defined herein shall have the respective meanings ascribed to them in the Motion.
2 1

The last four digits of the Debtors federal tax identification number are 6659.

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Bricoleur Capital Partners, LP in its capacity as second lien agent, and (iv) the Debtors 30 largest unsecured creditors, and it appearing that no other or further notice need be provided; and the Court having determined that the relief requested in the Motion being in the best interests of the Debtor, its creditors, and all parties in interest; and the Court having determined that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and upon all of the proceedings had before the Court and after due deliberation and sufficient cause appearing therefor, it is hereby ORDERED that the Motion is granted to the extent provided herein; and it is further ORDERED that except as may otherwise be provided in orders of the Court authorizing the retention of specific professionals, all professionals in this case may seek monthly compensation in accordance with the following procedures: (a) On or before the twentieth (20th) day of each month following the month for which compensation is sought, each professional seeking compensation under this Order shall serve a monthly statement (Monthly Fee Statement), by hand or overnight delivery on: (i) the Debtor, 5750 Grace Place, Los Angeles, California (Attn: Rick Hicks); (ii) counsel to the Debtor, Cooley LLP, 1114 Avenue of the Americas, New York, NY 10036 (Attn: Jeffrey L. Cohen, Esq.); (iii) counsel to all official committees; (iv) counsel for the Office of the United States Trustee, 33 Whitehall Street, 21st Floor, New York, New York 10004 (Attn: Susan Golden); (v) counsel to Wells Fargo Bank, N.A., Riemer & Braunstein LLP, 3 Center Plaza, Boston, Massachusetts 02108 (Attn: Donald E. Rothman), and (vi) Solomon Ward Seidenwurm & Smith, LLP, 401 B Street, Ste. 1200 San Diego, CA 92101 (Attn: Michael D. Breslauer, Esq.) as counsel to Bricoleur Capital Partners, LP in its capacity as second lien agent (collectively, the Notice Parties); (b) On or before the twentieth (20th) day of each month following the month for which compensation is sought, each professional seeking compensation shall file a Monthly Fee Statement with the Court; however, a courtesy copy need not be delivered to the Judges chambers. This Motion is not intended to alter the fee application requirements outlined in 330 and 331 of the Code. Professionals are still required to serve and file interim and final applications for approval of fees and expenses in accordance with the relevant provisions of the Code, the Federal Rules of Bankruptcy Procedure and the Local Rules for the United States Bankruptcy Court, Southern District of New York; (c) Each Monthly Fee Statement must contain a list of the individuals and their respective titles (e.g., attorney, accountant, or paralegal) who provided 2
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services during the statement period, their respective billing rates, the aggregate hours spent by each individual, a reasonably detailed breakdown of the disbursements incurred (no professional should seek reimbursement of an expense which would otherwise not be allowed pursuant to the Courts Administrative Orders dated June 24, 1991 and April 21, 1995 or the United States Trustee Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. 330 dated January 30, 1996), and contemporaneously maintained time entries for each individual in increments of tenths (1/10) of an hour; (d) If any party in interest has an objection to the compensation or reimbursement sought in a particular Monthly Fee Statement, such party shall, by no later than the thirty-fifth (35th) day following the month for which compensation is sought, file with the Court and serve upon the professional whose Monthly Fee Statement is objected to, and the other persons designated to receive statements in paragraph (a), a written Notice Of Objection To Fee Statement, setting forth the nature of the objection and the amount of fees or expenses at issue; (e) At the expiration of the thirty-five (35) day period, the Debtor shall promptly pay eighty percent (80%) of the fees and one hundred percent (100%) of the expenses identified in each Monthly Fee Statement to which no objection has been served in accordance with paragraph (d); (f) If a Notice Of Objection To Fee Statement is filed, the Debtor shall withhold payment of that portion of the Monthly Fee Statement to which the objection is directed and promptly pay the remainder of the fees and disbursements in the percentages set forth in paragraph (e) unless the professional whose statement is objected to seeks an order from the Court, upon notice and a hearing, directing payment to be made; (g) If the parties to an objection are able to resolve their dispute following the filing of a Notice of Objection to Fee Statement and if the party whose Monthly Fee Statement was objected to files a statement indicating that the objection is withdrawn and describing in detail the terms of the resolution, then the Debtor shall promptly pay, in accordance with paragraph (e), that portion of the Monthly Fee Statement which is no longer subject to an objection; (h) All objections that are not resolved by the parties or Court order, shall be preserved and presented to the Court at the next interim or final fee application hearing to be heard by the Court (see paragraph (j), below); (i) The service of an objection in accordance with paragraph (d) shall not prejudice the objecting partys right to object to any fee application made to the Court in accordance with the Code on any ground whether raised in the objection or not. Furthermore, the decision by any party not to object to a Monthly Fee Statement shall not be a waiver of any kind or prejudice that partys right to object to any fee application subsequently made to the Court in accordance with the Code; (j) Approximately every 120 days, but no more than every 150 days, each of the professionals shall serve and file with the Court an application for interim or 3
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final Court approval and allowance, pursuant to sections 330 and 331 of the Bankruptcy Code (as the case may be), of the compensation and reimbursement of expenses requested; (k) Any professional who fails to file an application seeking approval of compensation and expenses previously paid under this Order when due shall (1) be ineligible to receive further monthly payments of fees or expenses as provided herein until further order of the Court, and (2) may be required to disgorge any fees paid since retention or the last fee application, whichever is later; (l) The pendency of an application or a Court order that payment of compensation or reimbursement of expenses was improper as to a particular statement shall not disqualify a professional from the future payment of compensation or reimbursement of expenses as set forth above, unless otherwise ordered by the Court; (m) Neither the payment of, nor the failure to pay, in whole or in part, monthly compensation and reimbursement as provided herein shall have any effect on this Courts interim or final allowance of compensation and reimbursement of expenses of any professionals; (n) Counsel for each official committee may, in accordance with the foregoing procedure for monthly compensation and reimbursement of professionals, collect and submit statements of expenses, with supporting vouchers, from members of the committee he or she represents; provided, however, that such committee counsel ensures that these reimbursement requests comply with this Courts Administrative Orders dated June 24, 1991 and April 21, 1995; ORDERED that the Debtor shall include all payments to professionals on its monthly operating reports, including the amount paid to each professional; and it is further ORDERED that any party may object to requests for payments made pursuant to this Order on the grounds that the Debtor has not timely filed monthly operating reports, remained current with its administrative expenses and 28 U.S.C. 1930 fees, or a manifest exigency exists by seeking a further order of this Court, otherwise, this Order shall continue and shall remain in effect during the pendency of this case; and it is further ORDERED that all time periods set forth in this Order shall be calculated in accordance with Bankruptcy Rule 9006(a); and it is further ORDERED that this Court shall retain jurisdiction to hear and determine all matters arising from or related to the implementation, interpretation and/or enforcement of this Order; and it is further 4
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ORDERED that within two (2) business days of entry of this Order, the Debtor shall serve a copy of this Order on the Notice Parties; and it is further ORDERED that notice of the Motion as provided herein shall be deemed good and sufficient notice of such Motion. Dated: __________, 2011 White Plains, New York

HONORABLE ROBERT D. DRAIN UNITED STATES BANKRUPTCY JUDGE

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