IN THE UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION In re: COLLINS & AIKMAN CORPORATION,

et al.1 Debtors. ) ) ) ) ) ) ) ) Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) (Tax Identification #13-3489233) Honorable Steven W. Rhodes

DEBTORS MOTION FOR AN ORDER APPROVING THE SECOND STIPULATION BETWEEN THE DEBTORS AND LEAR CORPORATION REGARDING CERTAIN AMOUNTS OWED TO THE DEBTORS The above-captioned debtors (collectively, the Debtors) hereby move the Court (the Motion) for the entry of an order, substantially in the form of Exhibit A, approving the Second Stipulation Between the Debtors and Lear Corporation (Lear) Regarding Certain Amounts Owed to the Debtors. In support of this Motion, the Debtors respectfully state as follows: Jurisdiction 1. The Court has jurisdiction over this matter pursuant to 28 U.S.C. 1334. This matter

is a core proceeding within the meaning of 28 U.S.C. 157(b)(2).

1

The Debtors in the jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc., Case No. 05-55949; Becker Group, LLC (d/b/a/ Collins & Aikman Premier Mold), Case No. 05-55977; Brut Plastics, Inc., Case No. 05-55957; Collins & Aikman (Gibraltar) Limited, Case No. 05-55989; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation), Case No. 05-55952; Collins & Aikman Asset Services, Inc., Case No. 05-55959; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.), Case No. 05-55965; Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.), Case No. 05-55991; Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.), Case No. 05-55958; Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.), Case No. 05-55956; Collins & Aikman Automotive International, Inc., Case No. 05-55980; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.), Case No. 05-55985; Collins & Aikman Automotive Mats, LLC, Case No. 05-55969; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.), Case No. 05-55978; Collins & Aikman Automotive Services, LLC, Case No. 05-55981; Collins & Aikman Canada Domestic Holding Company, Case No. 05-55930; Collins & Aikman Carpet & Acoustics (MI), Inc., Case No. 05-55982; Collins & Aikman Carpet & Acoustics (TN), Inc., Case No. 05-55984; Collins & Aikman Development Company, Case No. 05-55943; Collins & Aikman Europe, Inc., Case No. 05-55971; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.), Case No. 05-55963; Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.), Case No. 05-55976; Collins & Aikman Interiors, Inc., Case No. 05-55970; Collins & Aikman International Corporation, Case No. 05-55951; Collins & Aikman Plastics, Inc., Case No. 05-55960; Collins & Aikman Products Co., Case No. 05-55932; Collins & Aikman Properties, Inc., Case No. 05-55964; Comet Acoustics, Inc., Case No. 05-55972; CW Management Corporation, Case No. 05-55979; Dura Convertible Systems, Inc., Case No. 05-55942; Gamble Development Company, Case No. 05-55974; JPS Automotive, Inc. (d/b/a PACJ, Inc.), Case No. 05-55935; New Baltimore Holdings, LLC, Case No. 05-55992; Owosso Thermal Forming, LLC, Case No. 0555946; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.), Case No. 05-55948; Wickes Asset Management, Inc., Case No. 0555962; and Wickes Manufacturing Company, Case No. 05-55968.

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0555927061219000000000012

,Y

2. 3.

Venue is proper pursuant to 28 U.S.C. 1408 and 1409. The statutory bases for the relief requested herein are section 363(b) of the

Bankruptcy Code, 11 U.S.C. 101-1330 (the Bankruptcy Code), and Rule 9019(a) of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules). Background 4. On May 17, 2005 (the Petition Date), the Debtors filed their voluntary petitions for

relief under chapter 11 of the Bankruptcy Code. The Debtors are operating their businesses and managing their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee or examiner has been appointed in these cases. On the Petition Date, the Court entered an order jointly administering these cases pursuant to Bankruptcy Rule 1015(b). 5. On May 24, 2005, the United States trustee appointed an official committee of

unsecured creditors pursuant to section 1102 of the Bankruptcy Code (the Committee). The Disputed Prepetition Debt 6. Prior to the Petition Date, the Debtors and Lear (collectively, the Parties) entered

into certain business arrangements whereby the Debtors provided Lear with certain automotive component parts and Lear provided the Debtors with certain automotive component parts. 7. The Parties disputed the respective amounts owed under such business arrangements

(the Disputed Amounts) and, on November 3, 2005, Lear filed its Motion for Relief from Stay [Docket No. 1619] (the Lear Motion), seeking among other relief, a declaration that the automatic stay did not prohibit it from recouping certain of the Disputed Amounts. 8. On March 2, 2006, the Parties filed a Stipulation Among the Debtors, Lear

Corporation and General Electric Capital Corporation Regarding Lear Corporations Motion for Relief from Stay [Docket No. 2286] (the First Stipulation), disposing of the Lear Motion and resolving all but a small portion of the Disputed Amounts (the Remaining Disputed Prepetition 2
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Debt). This Court entered an order approving the First Stipulation [Docket No. 2298] on March 3, 2006. 9. The Debtors and Lear have conducted extensive negotiations to resolve the

outstanding issues associated with the Remaining Disputed Prepetition Debt. As a result of such negotiations, the Parties have agreed to enter into a stipulation, in the form of Exhibit B attached hereto (the Second Stipulation), resolving the Remaining Disputed Prepetition Debt. 10. Under the terms of the Second Stipulation, the Parties have agreed that, among other

things, Lear will pay $39,756.04 to the Debtors, and Lear may recoup certain amounts from a reserve that has already been funded.3 Relief Requested 11. By this Motion, the Debtors respectfully request that the Court approve the

Stipulation pursuant to section 363(b) of the Bankruptcy Code and Bankruptcy Rule 9019(a). Notably, neither the agents for the Debtors senior, secured prepetition and postpetition lenders nor the Committee object to the Debtors request to enter into the Stipulation. Basis for Relief 12. Bankruptcy Rule 9019(a) provides, in pertinent part, that [o]n motion by the [debtor

in possession] and after notice and a hearing, the court may approve a compromise or settlement. Fed. R. Bankr. P. 9019(a). Section 363(b) allows a trustee or debtor in possession to use property of the estate other than in the ordinary course of business after appropriate notice and hearing. See 11 U.S.C. 363(b)(1). 13. Compromises are tools for expediting the administration of the case and reducing

administrative costs and are favored in bankruptcy. See Protective Comm. of Independent
3 This summary of the Second Stipulation is provided solely for the convenience of the Court and parties in interest. To the extent that there are any discrepancies between this summary and the Second Stipulation, the terms of the Second Stipulation shall govern.

3
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Stockholders of TMT Trailer Ferry, Inc. v. Anderson, 390 U.S. 414, 424 (1968) (In administering reorganization proceedings in an economic and practical matter it will often be wise to arrange the settlement of claims.); In re Fishell, 1995 WL 66622, at *2 (6th Cir. 1995); In re Haven, Inc., 2005 WL 927666, at *1 (6th Cir. B.A.P. 2005); In re Dow Corning Corp., 192 B.R. 415, 421 (AJS) (Bankr. E.D. Mich. 1996); see also Fogel v. Zell, 221 F.3d 955, 960 (7th Cir. 2000); In re Martin, 91 F.3d 389, 393 (3d Cir. 1996) (To minimize litigation and expedite the administration of a bankruptcy case, [c]ompromises are favored in bankruptcy.) (quoting 9 Collier on Bankruptcy 9019.03[1] (15th Ed. 1993)). Moreover, various courts have endorsed the use of

Bankruptcy Rule 9019 to resolve disputes. See, e.g., Bartel v. Bar Harbour Airways, Inc., 196 B.R. 268, 271 (S.D.N.Y. 1996); In re Check Reporting Service, Inc., 137 B.R. 653, 656 (Bankr. W.D. Mich. 1992); In re Miller, 148 B.R. 510, 516 (Bankr. N.D. Ill. 1992); In re Planned Systems, Inc., 82 B.R. 919, 921 (Bankr. S.D. Ohio 1988). 14. Generally, a settlement should be approved if it is determined to be fair and equitable

and does not fall below the lowest level of reasonableness. See Bauer v. Commerce Union Bank, 859 F.2d 438, 441 (6th Cir. 1988); In re Haven, Inc. 2005 WL 927666, at *3 (6th Cir. B.A.P. 2005); Dow Corning, 192 B.R. at 421. In determining whether a compromise satisfies this standard, courts ordinarily consider: (a) the probability of success in the litigation; (b) the difficulties, if any, to be encountered in the matter of collection; (c) the complexity and expense of the litigation involved; and (d) the paramount interest of creditors and proper deference to their reasonable views. See, e.g., In re Bard, 49 Fed. Appx. 528, 530 (6th Cir. 2002); In re Dow Corning Corp., 2003 WL 22218449, at *1 (DPH) (Bankr. E.D. Mich. 2003); In re Dalen, 259 B.R. 586, 611-13 (Bankr. W.D. Mich. 2001); In re Stinson, Inc., 221 B.R. 726, 732 (SWR) (Bankr. E.D. Mich. 1998).

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15.

The Second Stipulation satisfies the standard. Entry into the Second Stipulation (a)

avoids needless litigation over issues that have been consensually resolve by the Parties and (b) provides the Debtors with an immediate cash infusion without the delay and expense of such litigation. 16. Section 363(b)(1) provides that [t]he trustee, after notice and a hearing, may use,

sell, or lease, other than in the ordinary course of business, property of the estate. 11 U.S.C. 363(b)(1). Courts within the Sixth Circuit have held that transactions should be approved under section 363 when they are supported by sound business judgment. See, e.g., Stephens Indus., Inc. v. McClung, 789 F.2d 386, 390 (6th Cir. 1986) (concluding that a court can authorize a sale of a Debtors assets when a sound business purpose dictates such action.); In re Embrace Sys. Corp., 178 B.R. 112, 124 (Bankr. W.D. Mich. 1995); see also In re North American Royalties, Inc., 276 B.R. 860, 866 (Bankr. E.D. Tenn. 2002). 17. The Second Stipulation will mark the end of a dispute that began with the filing of the

Lear Motion and spawned litigation among the Debtors and two significant creditors in these Chapter 11 Cases. The potential ongoing litigation costs associated with this matter could well exceed the full value of the Remaining Disputed Prepetition Debt. The Second Stipulation, in contrast to potential costly litigation, provides for an immediate infusion of $39,756.04 into the Debtors estates. 18. Moreover, the Second Stipulation resolves an $88,209 receivable due to Lear by

allowing Lear to recoup such amounts and without requiring any cash payment by the Debtors. Such recoupment is proper because the receivable and the amount against which the receivable will be recouped arise out of the same subject-matter and are able to be resolved in a single transaction. See In re Thompson Boat Co. 230 B.R. 815, 823 (Bankr. E.D. Mich., 1995) (to invoke the common law

5
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doctrine of recoupment, [i]t is sufficient that the counter-claims arise out of the same subject-matter, and that they are susceptible of adjustment in one action.) quoting Ward v. Township of Alpine, 171 N.W. 446 (Michigan 1919). No relief from the automatic stay imposed by section 362 of the Bankruptcy Code is necessary to effectuate this recoupment. See In re Delicruz, 300 B.R. 669, 680 (Bankr. E.D. Mich. 2003) (recoupment reduc[es] or extinguish[es] a debt arising from the same transaction, and is not stayed by the bankruptcy) (internal quotations and citations omitted). 19. The Second Stipulation will allow the Debtors to receive cash in resolution of the

Remaining Disputed Prepetition Debt without additional expense and delay and dispose of the receivable without cash payment. Accordingly, the Debtors submit that the Second Stipulation meets the standards of section 363(b) of the Bankruptcy Code and Bankruptcy Rule 9019(a), and that the Court should, therefore, grant the Motion. Notice 20. Notice of this Motion has been given to the Core Group, the 2002 List and Lear as

required by the Case Management Procedures.4 In light of the nature of the relief requested, the Debtors submit that no further notice is required. No Prior Request 21. court. No prior motion for the relief requested herein has been made to this or any other

Capitalized terms used in this paragraph 20 not otherwise defined herein shall have the meanings set forth in the First Amended Notice, Case Management and Administrative Procedures filed on June 9, 2005 [Docket No. 294].

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WHEREFORE, the Debtors respectfully request the entry of the order, substantially in the form attached hereto as Exhibit A, (a) approving the Second Stipulation and (b) granting such other further relief as is just and proper. Dated: December 19, 2006 KIRKLAND & ELLIS LLP /s/ Marc J. Carmel Richard M. Cieri (NY RC 6062) Citigroup Center 153 East 53rd Street New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 -andDavid L. Eaton (IL 3122303) Ray C. Schrock (IL 6257005) Marc J. Carmel (IL 6272032) 200 East Randolph Drive Chicago, Illinois 60601 Telephone: (312) 861-2000 Facsimile: (312) 861-2200 -andCARSON FISCHER, P.L.C. Joseph M. Fischer (P13452) 4111 West Andover Road West - Second Floor Bloomfield Hills, Michigan 48302 Telephone: (248) 644-4840 Facsimile: (248) 644-1832 Co-Counsel for the Debtors

7
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EXHIBIT A

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IN THE UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION In re: COLLINS & AIKMAN CORPORATION, et al.1 Debtors. ) ) ) ) ) ) ) ) Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) (Tax Identification #13-3489233) Honorable Steven W. Rhodes

ORDER APPROVING THE SECOND STIPULATION BETWEEN THE DEBTORS AND LEAR CORPORATION REGARDING CERTAIN AMOUNTS OWED TO THE DEBTORS Upon the motion (the Motion)2 of the above-captioned debtors (collectively, the Debtors) for an order approving the Second Stipulation Between the Debtors and Lear Corporation Regarding Certain Amounts Owed to the Debtors [Docket No. ]; it appearing that the relief requested is in the best interest of the Debtors estates, their creditors and other parties in interest; it appearing that the Court has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334; it appearing that this proceeding is a core proceeding pursuant to 28 U.S.C. 157(b)(2); it
1 The Debtors in the jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc., Case No. 05-55949; Becker Group, LLC (d/b/a/ Collins & Aikman Premier Mold), Case No. 05-55977; Brut Plastics, Inc., Case No. 05-55957; Collins & Aikman (Gibraltar) Limited, Case No. 05-55989; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation), Case No. 05-55952; Collins & Aikman Asset Services, Inc., Case No. 05-55959; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.), Case No. 05-55965; Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.), Case No. 05-55991; Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.), Case No. 05-55958; Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.), Case No. 05-55956; Collins & Aikman Automotive International, Inc., Case No. 05-55980; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.), Case No. 05-55985; Collins & Aikman Automotive Mats, LLC, Case No. 05-55969; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.), Case No. 05-55978; Collins & Aikman Automotive Services, LLC, Case No. 05-55981; Collins & Aikman Canada Domestic Holding Company, Case No. 05-55930; Collins & Aikman Carpet & Acoustics (MI), Inc., Case No. 05-55982; Collins & Aikman Carpet & Acoustics (TN), Inc., Case No. 05-55984; Collins & Aikman Development Company, Case No. 05-55943; Collins & Aikman Europe, Inc., Case No. 05-55971; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.), Case No. 05-55963; Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.), Case No. 05-55976; Collins & Aikman Interiors, Inc., Case No. 05-55970; Collins & Aikman International Corporation, Case No. 05-55951; Collins & Aikman Plastics, Inc., Case No. 05-55960; Collins & Aikman Products Co., Case No. 05-55932; Collins & Aikman Properties, Inc., Case No. 05-55964; Comet Acoustics, Inc., Case No. 05-55972; CW Management Corporation, Case No. 05-55979; Dura Convertible Systems, Inc., Case No. 05-55942; Gamble Development Company, Case No. 05-55974; JPS Automotive, Inc. (d/b/a PACJ, Inc.), Case No. 05-55935; New Baltimore Holdings, LLC, Case No. 05-55992; Owosso Thermal Forming, LLC, Case No. 0555946; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.), Case No. 05-55948; Wickes Asset Management, Inc., Case No. 0555962; and Wickes Manufacturing Company, Case No. 05-55968. Capitalized terms used but not otherwise defined herein shall have the meanings set forth in the Motion.

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appearing that venue of this proceeding and this Motion in this District is proper pursuant to 28 U.S.C. 1408 and 1409; it appearing that notice of the Motion, the Second Stipulation and the opportunity for a hearing on this Motion was appropriate under the particular circumstances and that no other or further notice need by given; and after due deliberation and sufficient cause appearing therefor, it is hereby ORDERED 1. 2. 3. The Motion is granted in its entirety. The Second Stipulation is approved. The Debtors are authorized to take all actions necessary to effectuate the relief

granted pursuant to this Order in accordance with the Motion. 4. upon its entry. 5. The Court retains jurisdiction with respect to all matters arising from or related to the The terms and conditions of this Order shall be immediately effective and enforceable

implementation of this Order.

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IN THE UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION In re: COLLINS & AIKMAN CORPORATION, et al.1 Debtors. ) ) ) ) ) ) ) ) Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) (Tax Identification #13-3489233) Honorable Steven W. Rhodes

NOTICE AND OPPORTUNITY TO RESPOND TO THE DEBTORS MOTION FOR AN ORDER APPROVING THE SECOND STIPULATION BETWEEN THE DEBTORS AND LEAR CORPORATION REGARDING CERTAIN AMOUNTS OWED TO THE DEBTORS PLEASE TAKE NOTICE THAT the above-captioned debtors (collectively, the Debtors) have filed their Motion for an Order Approving the Second Stipulation Between the Debtors and Lear Corporation Regarding Certain Amounts Owed to the Debtors (the Motion). PLEASE TAKE FURTHER NOTICE THAT your rights may be affected. You may wish to review the Motion and discuss it with your attorney, if you have one in these cases. (If you do not have an attorney, you may wish to consult one.)

The Debtors in the jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc., Case No. 05-55949; Becker Group, LLC (d/b/a/ Collins & Aikman Premier Mold), Case No. 05-55977; Brut Plastics, Inc., Case No. 05-55957; Collins & Aikman (Gibraltar) Limited, Case No. 05-55989; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation), Case No. 05-55952; Collins & Aikman Asset Services, Inc., Case No. 05-55959; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.), Case No. 05-55965; Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.), Case No. 05-55991; Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.), Case No. 05-55958; Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.), Case No. 05-55956; Collins & Aikman Automotive International, Inc., Case No. 05-55980; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.), Case No. 05-55985; Collins & Aikman Automotive Mats, LLC, Case No. 05-55969; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.), Case No. 05-55978; Collins & Aikman Automotive Services, LLC, Case No. 05-55981; Collins & Aikman Canada Domestic Holding Company, Case No. 05-55930; Collins & Aikman Carpet & Acoustics (MI), Inc., Case No. 05-55982; Collins & Aikman Carpet & Acoustics (TN), Inc., Case No. 05-55984; Collins & Aikman Development Company, Case No. 05-55943; Collins & Aikman Europe, Inc., Case No. 05-55971; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.), Case No. 05-55963; Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.), Case No. 05-55976; Collins & Aikman Interiors, Inc., Case No. 05-55970; Collins & Aikman International Corporation, Case No. 05-55951; Collins & Aikman Plastics, Inc., Case No. 05-55960; Collins & Aikman Products Co., Case No. 05-55932; Collins & Aikman Properties, Inc., Case No. 05-55964; Comet Acoustics, Inc., Case No. 05-55972; CW Management Corporation, Case No. 05-55979; Dura Convertible Systems, Inc., Case No. 05-55942; Gamble Development Company, Case No. 05-55974; JPS Automotive, Inc. (d/b/a PACJ, Inc.), Case No. 05-55935; New Baltimore Holdings, LLC, Case No. 05-55992; Owosso Thermal Forming, LLC, Case No. 0555946; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.), Case No. 05-55948; Wickes Asset Management, Inc., Case No. 0555962; and Wickes Manufacturing Company, Case No. 05-55968.

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PLEASE TAKE FURTHER NOTICE THAT in accordance with the First Amended Notice, Case Management and Administrative Procedures filed on June 9, 2005 [Docket No. 294] (the Case Management Procedures), if you wish to object to the Court granting the relief sought in the Motion, or if you want the Court to otherwise consider your views on the Motion, no later than January 4, 2007 at 4:00 p.m. prevailing Eastern Time, or such shorter time as the Court may hereafter order and of which you may receive subsequent notice, you or your attorney must file with the Court a written response, explaining your position at:2 United States Bankruptcy Court 211 West Fort Street, Suite 2100 Detroit, Michigan 48226 PLEASE TAKE FURTHER NOTICE THAT if you mail your response to the Court for filing, you must mail it early enough so the Court will receive it on or before the date above. PLEASE TAKE FURTHER NOTICE THAT you must also serve the documents so that they are received on or before January 4, 2007 at 4:00 p.m. prevailing Eastern Time, in accordance with the Case Management Procedures, including to: Kirkland & Ellis LLP Attn: Richard M. Cieri Citigroup Center 153 East 53rd Street New York, New York 10022 Facsimile: (212) 446-4900 E-mail: [email protected] -and-

Response or answer must comply with Rule 8(b), (c) and (e) of the Federal Rules of Civil Procedure.

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Kirkland & Ellis LLP Attn: David L. Eaton Ray C. Schrock Marc J. Carmel 200 East Randolph Drive Chicago, Illinois 60601 Facsimile: (312) 861-2200 E-mail: [email protected] [email protected] [email protected] -andCarson Fischer, P.L.C. Attn: Joseph M. Fischer 4111 West Andover Road West - Second Floor Bloomfield Hills, Michigan 48302 Facsimile: (248) 644-1832 E-mail: [email protected] PLEASE TAKE FURTHER NOTICE THAT if no responses to the Motion are timely filed and served, the Court may grant the Motion and enter the order without a hearing as set forth in Rule 9014-1 of the Local Rules for the United States Bankruptcy Court for the Eastern District of Michigan.

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Dated: December 19, 2006

KIRKLAND & ELLIS LLP /s/ Marc J. Carmel Richard M. Cieri (NY RC 6062) Citigroup Center 153 East 53rd Street New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 -andDavid L. Eaton (IL 3122303) Ray C. Schrock (IL 6257005) Marc J. Carmel (IL 6272032) 200 East Randolph Drive Chicago, Illinois 60601 Telephone: (312) 861-2000 Facsimile: (312) 861-2200 -andCARSON FISCHER, P.L.C. Joseph M. Fischer (P13452) 4111 West Andover Road West - Second Floor Bloomfield Hills, Michigan 48302 Telephone: (248) 644-4840 Facsimile: (248) 644-1832 Co-Counsel for the Debtors

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CERTIFICATE OF SERVICE I, Marc J. Carmel, an attorney, certify that on the 19th day of December, 2006, I caused to be served, by e-mail, facsimile and by overnight delivery, in the manner and to the parties set forth on the attached service lists, a true and correct copy of the foregoing Debtors Motion for an Order Approving the Second Stipulation Between the Debtors and Lear Corporation Regarding Certain Amounts Owed to the Debtors. Dated: December 19, 2006 /s/ Marc J. Carmel Marc J. Carmel

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Served via Electronic Mail

CREDITOR NAME A Freeman Acord Inc Adrian City Hall Alice B Eaton Amalgamated Life Askounis & Borst PC Assistant Attorney General of Texas ATC Nymold Corporation Athens City Tax Collector Autoliv ASP Inc Bailey & Cavalieri LLC Baker & Hostetler LLP Balch & Bingham LLP Barnes & Thornburg LLP Barnes & Thornburg LLP Bartlett Hackett Feinberg Basell USA Inc

CREDITOR NOTICE NAME John Livingston John Fabor Judith Greenspan Esq Thomas V Askounis Esq E Stuart Phillips Sherry Epstein Mike Keith Eric R Swanson Esq & Anthony J Nellis Esq Adam J Biehl & Yvette A Cox Wendy J Gibson & Brian A Bash Eric T Ray John T Gregg Patrick E Mears Frank F McGinn Scott Salerni

Benesch Friedlander Coplan & Aronoff LLP William E Schonberg & Stuart A Laven Jr Bernardi Ronayne & Glusac PC Rodney M. Glusac Bernstein Litowitz Berger & Grossman LLP Berry Moorman PC Berry Moorman PC Bird Svendsen Brothers Scheske & Pattison PC Borges & Associates LLC Bose McKinney & Evans LLP Bradley Arant Rose & White LLP Brendan G Best Brown Rudnick Berlack Israels LLP Bryan Clay Burr & Forman LLP Butzel Long PC Butzel Long PC Cahill Gordon & Reindel Cahill Gordon & Reindel Calhoun Di Ponio & Gaggos PLC Carlile Patchen & Murphy LLP Chambliss Bahner & Stophel PC Champaign County Collector Chris Kocinski City Of Eunice City Of Evart City Of Kitchener Finance Dept City Of Lowell City Of Marshall City Of Muskegon City Of Port Huron City Of Rialto City Of Rochester Hills City Of Salisbury City Of Westland City Of Woonsocket Ri City Treasurer City Treasurer Colbert & Winstead PC Steven Singer & John Browne Dante Benedettini Esq James Murphy Esq Eric J Scheske Wanda Borges Esq Jeannette Eisan Hinshaw Jay R Bender

EMAIL [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected]

Robert Stark & Steven Smith Shannon E Hoff Daniel N Sharkey & Paula A Osborne Matthew E Wilkins Esq Jonathan A Schaffzin Robert Usadi Kevin C Calhoun Leon Friedberg Bruce C Bailey Barb Neal The Mator at City Hall Roger Elkins City Manager Pauline Houston Lowell Regional Wastewater Maurice S Evans City Manager Bob Robles Treasurer's Office City Treasurer Kurt A Dawson City Assesor Treasurer Business License Div Pretreatment Division Tracy Horvarter Amy Wood Malone

Cole Schotz Meisel Forman & Leonard PA Stuart Komrower & Mark Politan Constellation NewEnergy Inc Catherine Barron Esq

In re: Collins & Aikman Corp., et al. Case No. 05-55927 (SWR)

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EXHIBIT B

K&E 11475585.6

IN THE UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION In re: COLLINS & AIKMAN CORPORATION, et al.1 Debtors. ) ) ) ) ) ) ) ) Chapter 11 Case No. 05-55927 (SWR) (Jointly Administered) (Tax Identification #13-3489233) Honorable Steven W. Rhodes

SECOND STIPULATION AMONG THE DEBTORS AND LEAR CORPORATION REGARDING LEAR CORPORATIONS MOTION FOR RELIEF FROM STAY This Second Stipulation (Stipulation) regarding Lear Corporations Motion for Relief from Stay [Docket No. 1619] (Motion) is made as of January ___, 2007, among the abovecaptioned debtors (collectively, including any of the above-captioned debtors affiliates and subsidiaries, the Debtors) and Lear Corporation and Lear Corporations affiliates and subsidiaries as defined in Lear Corporations Purchase Order Terms and Conditions (collectively, Lear, and collectively with the Debtors, the Parties).

The Debtors in the jointly administered cases include: Collins & Aikman Corporation; Amco Convertible Fabrics, Inc., Case No. 05-55949; Becker Group, LLC (d/b/a/ Collins & Aikman Premier Mold), Case No. 05-55977; Brut Plastics, Inc., Case No. 05-55957; Collins & Aikman (Gibraltar) Limited, Case No. 05-55989; Collins & Aikman Accessory Mats, Inc. (f/k/a the Akro Corporation), Case No. 05-55952; Collins & Aikman Asset Services, Inc., Case No. 05-55959; Collins & Aikman Automotive (Argentina), Inc. (f/k/a Textron Automotive (Argentina), Inc.), Case No. 05-55965; Collins & Aikman Automotive (Asia), Inc. (f/k/a Textron Automotive (Asia), Inc.), Case No. 0555991; Collins & Aikman Automotive Exteriors, Inc. (f/k/a Textron Automotive Exteriors, Inc.), Case No. 05-55958; Collins & Aikman Automotive Interiors, Inc. (f/k/a Textron Automotive Interiors, Inc.), Case No. 05-55956; Collins & Aikman Automotive International, Inc., Case No. 05-55980; Collins & Aikman Automotive International Services, Inc. (f/k/a Textron Automotive International Services, Inc.), Case No. 05-55985; Collins & Aikman Automotive Mats, LLC, Case No. 05-55969; Collins & Aikman Automotive Overseas Investment, Inc. (f/k/a Textron Automotive Overseas Investment, Inc.), Case No. 05-55978; Collins & Aikman Automotive Services, LLC, Case No. 05-55981; Collins & Aikman Canada Domestic Holding Company, Case No. 05-55930; Collins & Aikman Carpet & Acoustics (MI), Inc., Case No. 05-55982; Collins & Aikman Carpet & Acoustics (TN), Inc., Case No. 05-55984; Collins & Aikman Development Company, Case No. 05-55943; Collins & Aikman Europe, Inc., Case No. 05-55971; Collins & Aikman Fabrics, Inc. (d/b/a Joan Automotive Industries, Inc.), Case No. 05-55963; Collins & Aikman Intellimold, Inc. (d/b/a M&C Advanced Processes, Inc.), Case No. 05-55976; Collins & Aikman Interiors, Inc., Case No. 05-55970; Collins & Aikman International Corporation, Case No. 05-55951; Collins & Aikman Plastics, Inc., Case No. 05-55960; Collins & Aikman Products Co., Case No. 05-55932; Collins & Aikman Properties, Inc., Case No. 0555964; Comet Acoustics, Inc., Case No. 05-55972; CW Management Corporation, Case No. 05-55979; Dura Convertible Systems, Inc., Case No. 05-55942; Gamble Development Company, Case No. 05-55974; JPS Automotive, Inc. (d/b/a PACJ, Inc.), Case No. 05-55935; New Baltimore Holdings, LLC, Case No. 05-55992; Owosso Thermal Forming, LLC, Case No. 05-55946; Southwest Laminates, Inc. (d/b/a Southwest Fabric Laminators Inc.), Case No. 05-55948; Wickes Asset Management, Inc., Case No. 05-55962; and Wickes Manufacturing Company, Case No. 05-55968.

K&E 11423353.4

WHEREAS, on May 17, 2005 (Petition Date), the Debtors filed petitions for relief under chapter 11 of title 11 of the United States Code, 11 U.S.C. 101-1330 (as amended, the Bankruptcy Code), in the United States Bankruptcy Court for the Eastern District of Michigan (the Court); and WHEREAS, prior to the Petition Date, the Debtors provided Lear with certain automotive component parts for which Lear and the Debtors agreed in the First Stipulation (defined below) that (before consideration of Lears setoff and recoupment rights) the prepetition Lear receivable owed to the Debtors was $4,441,028 (the Lear Receivable). At the time of the First Stipulation, the Debtors believed that they were owed an additional $866,622 from Lear (including additional amounts, claimed to be owed to General Electric Capital Corporation (GECC), as discussed below), on account of prepetition shipments to Lear (the Disputed Prepetition Debt); and WHEREAS, prior to the Petition Date, Lear provided to the Debtors certain automotive component parts for which the Debtors agreed in the First Stipulation that Lear was owed $331,899 (the Debtors Receivable). At the time of the First Stipulation, Lear asserted that it continued to be owed on account of prepetition shipments to the Debtors an additional $88,209 from the Debtors (the Additional Receivable). The parties have reconciled and now agree that the Additional Receivable is due to Lear; and WHEREAS, on November 3, 2005, Lear filed the Motion, seeking among other relief, a declaration that the automatic stay did not prohibit it from recouping the prepetition amounts owed to Lear by the Debtors against prepetition amounts that Lear owed the Debtors; and

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WHEREAS, under certain agreements (collectively, the Agreements) the Debtors sold, assigned and transferred certain of their accounts receivables to Carcorp Inc., who in turn assigned substantially all of those accounts receivable to GECC; and WHEREAS, GECC alleges that, under the terms of the Agreements, approximately $1,776,305 of the Lear Receivable was assigned to GECC. In the First Stipulation, the Parties agreed that $1,323,907 was owed with respect to those assigned accounts. The difference of approximately $452,398 was included in the Disputed Prepetition Debt; and WHEREAS, on December 22, 2005, GECC filed a Limited Objection of General Electric Capital Corporation to Motion of Lear Corporation for Relief from the Stay [Docket No. 1946] (the Objection) asserting that the Motion should be denied to the extent Lear sought court approval to exercise any recoupment against accounts receivable assigned to GECC; and WHEREAS, under the Agreements, GECC claims to own and hold valid, perfected first and prior liens on and security interests in, among other assets of the Debtors, the portion of the Lear Receivable described in the second paragraph preceding this paragraph; and WHEREAS, on December 22, 2005, GECC filed a complaint for declaratory judgment and related relief [Docket No. 1944] (Complaint) against the Debtors and Lear seeking payment of the portion of the Lear Receivable assigned to GECC; and WHEREAS, on March 2, 2006, the Parties filed a Stipulation Among the Debtors, Lear Corporation and General Electric Capital Corporation Regarding Lear Corporations Motion for Relief from Stay [Docket No. 2286] (First Stipulation), agreeing that (i) Lear could recoup $331,899 from the portion of the Lear Receivable not assigned to GECC (the Lear Payment Amount), (ii) Lear would pay $2,697,683 to the Debtors, on account of the portion of the Lear Receivable not assigned to GECC, and $1,323,907 to GECC, both payments together

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representing the undisputed prepetition amount owed by Lear, less the Lear Payment Amount and less a reserve (the Reserve) to cover the Additional Receivable; and (iii) the Parties would continue to seek reconciliation and resolution with respect to the Disputed Prepetition Debt and Additional Receivable; and WHEREAS, on March 3, 2006 this Court entered an order approving the First Stipulation [Docket No. 2298]; and WHEREAS, in accordance with the First Stipulation, Lear paid the Debtors $2,697,683 and paid GECC $1,323,907, and the Parties continued to seek a resolution of the unresolved disputes; and WHEREAS, on October 13, 2006, the Court entered the Order Approving the Stipulation Regarding the Receivables Transfer Agreement Between the Debtors and General Electric Capital Corporation [Docket No. 3500]; and WHEREAS, the Parties now agree that $513,167.85 of the Disputed Prepetition Debt is actually owed by various other customers of the Debtors or is otherwise not payable by Lear and, therefore, not properly categorized as part of the Lear Receivable; and WHEREAS, the Parties now agree that $273,271.88 of the Disputed Prepetition Debt is based on invoices that were paid by Lear and, therefore, not properly categorized as part of the Lear Receivable; and WHEREAS, after taking into account the amounts the Parties agree are not owed by Lear to the Debtors or GECC, the remaining Disputed Prepetition Debt is $79,512.08; and WHEREAS, in the interest of resolving this matter without need for further litigation the Parties agree that Lear will pay $39,756.04 (one-half of the remaining Disputed Prepetition Debt) to the Debtors in full and final settlement of the Disputed Prepetition Debt; and

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WHEREAS, the Parties have agreed that the Additional Receivable is properly due to Lear from Debtors and may be recouped from the Reserve. NOW, THEREFORE, in consideration of the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is acknowledged, it is stipulated and agreed among the Parties as follows: 1. Within five business days of the Court entering an order approving this

Stipulation, Lear shall pay $39,756.04 to the Debtors. 2. Payment of the $39,756.04 to the Debtors shall absolve Lear of any and all

liability to the Debtors for any debts on account of the Lear Receivable or the Disputed Prepetition Debt. 3. The Debtors and Lear agree that Lear may recoup the Reserve and apply it in full

settlement of the Additional Receivable. 4. Upon entry of the Order approving this Stipulation, recoupment of the Reserve by

Lear and bank clearance of the payments made to the Debtors in satisfaction of this Stipulation, (a) the Debtors release Lear from any and all claims, actions, rights or allegations with respect to any amounts owed to the Debtors on account of the Disputed Prepetition Debt or the Lear Receivable and (b) Lear releases the Debtors from any and all claims, actions, rights or allegations with respect to any amounts owed to Lear from the Debtors on account of the Debtors Receivable or the Additional Receivable; provided, however, that the foregoing does not release the Debtors from any other prepetition or postpetition claims of Lear against the Debtors, including without limitation, rejection damages, if any, or warranty claims, if any, and any rights, defenses, setoffs, objections, counterclaims or any other action that the Debtors may have with respect to such claims are hereby reserved.

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5.

The Court shall retain jurisdiction (and the Debtors and Lear consent to such

retention of jurisdiction) to resolve any disputes or controversies arising from this Stipulation. Any request for relief brought before the Court to resolve a dispute arising from this Stipulation shall be brought on proper notice and in accordance with relevant Federal Rules of Bankruptcy Procedure and Local Rules for the Bankruptcy Court of the Eastern District of Michigan. 6. Nothing in this Stipulation shall be taken as an acknowledgment that any contract

between the Debtors and Lear is executory or that the Debtors intend to either reject or assume any such contract. 7. This Stipulation may be executed in multiple counterparts, any of which may be

transmitted by facsimile, and each of which shall be deemed an original, but all of which together shall constitute one instrument. 8. This Stipulation shall not be modified, altered, amended or vacated without

written consent of all parties hereto. Any such modification, alteration, amendment or vacation, in whole or in part, shall be subject to the approval of the Court. 9. The terms and conditions of this Stipulation shall be immediately effective and

enforceable upon the entry of the order approving this Stipulation. [Remainder of page intentionally left blank]

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KIRKLAND & ELLIS LLP

BODMAN LLP

By: Richard M. Cieri (NY RC 6062) Citigroup Center 153 East 53rd Street New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 -andDavid L. Eaton (IL 3122303) Ray C. Schrock (IL 6257005) Marc J. Carmel (IL 6272032) 200 East Randolph Drive Chicago, Illinois 60601 Telephone: (312) 861-2000 Facsimile: (312) 861-2200 -andCARSON FISCHER, P.L.C. Joseph M. Fischer (P13452) 4111 West Andover Road West Second Floor Bloomfield Hills, Michigan 48302 Telephone: (248) 64404840 Facsimile: (248) 644-1832 Co-Counsel for the Debtors

By: Robert J. Diehl, Jr. (P31264) Ralph E. McDowell (P39235) 6th Floor at Ford Field 1901 St. Antoine Street Detroit, Michigan 48226 Telephone: (313) 259-7777 Counsel for Lear

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