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UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION In re: ) ) PEREGRINE FINANCIAL GROUP, INC., ) ) Debtor. ) ) ) ) Chapter 7 Case No. 12-27488 Honorable Carol A. Doyle Hearing Date: October 4, 2012 Hearing Time: 10:00 a.m.

NOTICE OF MOTION PLEASE TAKE NOTICE that on October 4, 2012 at 10:00 a.m., the undersigned shall appear before the Honorable Judge Carol A. Doyle, in Courtroom 742, 219 South Dearborn Street, Chicago, Illinois, and then and there present the AGREED MOTION TO MODIFY THE AUTOMATIC STAY TO PERMIT JPMORGAN CHASE BANK N.A. TO EXERCISE LIMITED RIGHTS AND REMEDIES IN CERTAIN CASH COLLATERAL, at which time you may appear if you deem fit. Dated: September 28, 2012 Respectfully submitted, Ira Bodenstein, not personally, but as chapter 7 trustee for the estate of Peregrine Financial Group, Inc. By: Robert M. Fishman (#3124316) Mark L. Radtke (#6275738) Shaw Gussis Fishman Glantz Wolfson & Towbin LLC 321 North Clark Street Suite 800 Chicago, Illinois 60654 Phone: (312) 541-0151 Fax: (312) 980-3888 /s/ Mark L. Radtke One of his attorneys

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CERTIFICATE OF SERVICE Mark L. Radtke certifies that he caused to be served a true copy of the above and foregoing NOTICE OF MOTION and AGREED MOTION TO MODIFY THE AUTOMATIC STAY TO PERMIT JPMORGAN CHASE BANK N.A. TO EXERCISE LIMITED RIGHTS AND REMEDIES IN CERTAIN CASH COLLATERAL upon the attached Electronic Mail Notice List through the ECF System and on the attached Service List in the manner so indicated on this 28th day of September, 2012. /s/ Mark L. Radtke
Mailing Information for Case 12-27488 Electronic Mail Notice List The following is the list of parties who are currently on the list to receive email notice/service for this case.  Kimberly A Bacher kbacher@shawgussis.com, bharrington@shawgussis.com  Salvatore A Barbatano sbarbatano@shawgussis.com, jhampton@shawgussis.com  Lawrence M. Benjamin lbenjamin@ngelaw.com, rwills@ngelaw.com  Stephen T. Bobo sbobo@reedsmith.com  Ira Bodenstein iratrustee@shawgussis.com, IL29@ecfcbis.com;sdelamora@shawgussis.com  Ira Bodenstein ibodenstein@shawgussis.com, sdelamora@shawgussis.com  David E Cohen dcohen@fishercohen.com  Brooke E Conner bconner@vedderprice.com, ecfdocket@vedderprice.com;ecarlson@vedderprice.com  Michael M. Eidelman meidelman@vedderprice.com, ecfdocket@vedderprice.com  Robert M Fishman rfishman@shawgussis.com  Geoffrey S. Goodman ggoodman@foley.com, egreen@foley.com;khall@foley.com  Ava Gould agould@cftc.gov  Joshua M Grenard jgrenard@mayerbrown.com, courtnotification@mayerbrown.com  Allen J Guon aguon@shawgussis.com, sdelamora@shawgussis.com  John W Guzzardo jguzzardo@shawgussis.com, mcarter@shawgussis.com  David Paul Holtkamp dholtkamp@wfactorlaw.com, nb@wfactorlaw.com  Stephanie K. Hor-Chen shor@vedderprice.com, ecfdocket@vedderprice.com  Kevin M Hyde khyde@shawgussis.com, jhampton@shawgussis.com  Thomas S Kiriakos tkiriakos@mayerbrown.com, Courtnotification@mayerbrown.com  James C. Koutoulas jk@typhoncap.com  Vincent E. Lazar vlazar@jenner.com, lyap@jenner.com;mmatlock@jenner.com;docketing@jenner.com  Randall M Lending rlending@vedderprice.com, trobinson@vedderprice.com;ecfdocket@vedderprice.com  Michael C. Moody mmoody@orourkeandmoody.com, firm@orourkeandmoody.com,morourke@orourkeandmoody.com  Jennifer M. Muchoney jmuchoney@pfgbest.com  Michael J O'Rourke morourke@okmlaw.com  Mark L Radtke mradtke@shawgussis.com, bharrington@shawgussis.com  Rene S Roupinian RSR@outtengolden.com  Richard A. Saldinger rsaldinger@shawgussis.com  Jessica M Scheller jscheller@shawgussis.com, kdevries@shawgussis.com  Sean T Scott stscott@mayerbrown.com  Scott A Semenek scott.semenek@faegrebd.com, melanie.senesac@faegrebd.com  Anne W Stukes astukes@cftc.gov

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  

William W Thorsness wthorsness@vedderprice.com, ecfdocket@vedderprice.com John Edward Waters john.waters@iowa.gov Thomas C. Wolford twolford@ngelaw.com

Via Electronic Mail and U.S. Mail CRT Special Investments LLC Attn: Joseph Sarachek 262 Harbor Drive Stamford, CT 06902 Gaivesville Coins, Inc. c/o Stephanie C. Lieb, Esq. 101 E. Kennedy Blvd., Ste. 2700 Tampa, FL 33602 rcolton@trenam.com slieb@trenam.com Joseph M. Russell JP Morgan Chase Bank NA 10 S. Dearborn Street Chicago, IL 60603 Joe.russell@jpmchase.com Gilbert B. Weisman Becket & Lee LLP 16 General Warren Blvd. Malvern, PA 19355 Notices@becket-lee.com John B. Connor John B. Connor, P.L.C. 1033 N. Fairfax St., Ste. 310 Alexandria, VA 22314 jack@johnbconnor.com Outten & Golden LLP 3 Park Ave., 29th Floor New York, NY 10016 Attn: Jack Raisner Rene Roupinian Stephen Mertz Michael Stewart Faegre Baker Daniels LLP 90 South 7th St., Ste. 2200 Minneapolis, MN 55402 stephen.mertz@faegrebd.com Michael.stewart@faegrebd.com William L. Wallander John Paul K. Napier Vinson & Elkins L.L.P. 2001 Ross Avenue, Ste. 3700 Dallas, TX 75201 jnapier@velaw.com bwallander@velaw.com Lazonia Clark Chase Paymentech Solutions, LLC 14221 Dallas Parkway Building II Dallas, TX 75254-2942 Lazonia.clark@chasepaymentech.com Andrea M. Momnie Philip J. Hendel Hendel & Collins, P.C. 101 State Street Springfield, MA 01103 amomnie@hendelcollins.com

Alicia Martin Attn: Steven R. Lehr, Esq. Steven R. Lehr, P.C. 33 Clinton Road, Ste. 100 West Caldwell, NJ 07006 slehr@lehrlaw.com Via Electronic Mail Rosemary Hollinger rhollinger@cftc.gov Robert W. Wasserman rwasserman@cftc.gov Scott Williamson swilliamson@cftc.gov Pat DiMaria pdimaria@pfgbest.com Vivian Drohan vdrohan@dlkny.com

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UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION
In re: PEREGRINE FINANCIAL GROUP, INC., ) ) ) ) ) ) ) ) ) Chapter 7 Case No. 12-27488

Honorable Judge Carol A. Doyle Hearing Date: October 4, 2012 Hearing Time: 10:00 a.m.

Debtor.

AGREED MOTION TO MODIFY THE AUTOMATIC STAY TO PERMIT JPMORGAN CHASE BANK N.A. TO EXERCISE LIMITED RIGHTS AND REMEDIES IN CERTAIN CASH COLLATERAL Ira Bodenstein, not personally, but as chapter 7 trustee (“Trustee”) for the estate of Peregrine Financial Group, Inc. d/b/a PFG Best (“Debtor”), pursuant to sections 105(a) and 362(d)(1) of title 11 of the United States Code (the “Bankruptcy Code”) and Rule 4001(d) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), moves for entry of an order (i) approving the Trustee’s agreement with JPMorgan Chase Bank, N.A. (“JPMorgan”) to provisionally authorize JPMorgan to exercise rights and remedies as a secured creditor (including, without limitation, setoff rights) it has in and to certain cash collateral it is holding against prepetition indebtedness of the Debtor relating to a letter of credit in the face amount of $300,000, and (ii) permitting relief from the automatic stay in order for JPMorgan to effectuate the exercise of those rights and remedies (including setoff). In support of the motion, the Trustee states as follows: Jurisdiction 1. This Court has jurisdiction to hear this matter and enter a final order granting the

relief requested herein pursuant to 28 U.S.C. §§ 157 and 1334 and Internal Operating Procedure

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15(a) of the United States District Court for the Northern District of Illinois. Venue is proper in this District pursuant to 28 U.S.C. §§ 1408 and 1409. 2. The statutory bases for the relief requested herein are sections 105(a) and

362(d)(1) of the Bankruptcy Code and Bankruptcy Rule 4001(d). Background 3. On July 10, 2012 (“Petition Date”), the Debtor filed a voluntary petition for relief

under chapter 7 of the Bankruptcy Code, 11 U.S.C. § 101, et. seq. Ira Bodenstein is the duly appointed chapter 7 trustee of the Debtor’s estate. On July 13, 2012, the Court entered an order authorizing the Trustee to operate the Debtor’s business and pay employee obligations pursuant to 11 U.S.C. § 721. 4. JPMorgan issued a letter of credit identified as LC ref # CTCS-689995 for the

benefit of ERGS Golub Realty, L.L.C. (“Golub”) in the face amount of $300,000 (the “Golub LC”). The Golub LC was set to expire on October 1, 2012. Golub is the Debtor’s landlord for its office lease at 311 West Monroe, Chicago, Illinois (the “Lease”). 5. The Trustee has not sought to assume or reject the Lease and is current on all

payments required under the Lease. 6. On or about September 17, 2012, JPMC asserts that it received from Golub a

conforming draw document for payment of the full amount under the Golub LC. On or about September 19, 2012, JPMorgan honored Golub’s demand. 7. JPMorgan asserts that, on or about October 6, 2006, Debtor executed a certain

Assignment of Deposit Account Agreement (the “Pledge Agreement”) granting JPMorgan a security interest in deposit account no. xxxxx7253 (the “Account”) to secure payment and performance of the Debtor’s “Liabilities” (as that term is defined in the Pledge Agreement). A

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copy of the Pledge Agreement is attached hereto as Exhibit A. JPMorgan further asserts that the Liabilities secured by the Pledge Agreement include, without limitation, Debtor’s reimbursement obligations under and with respect to the Golub LC and certain other letters of credit issued by JPMorgan for the account of the Debtor. JPMorgan is currently holding cash collateral in the amount of $962,601.27 in the Account (the “Cash Collateral”). With respect to the Golub LC, JPMorgan has asserted that the Debtor’s reimbursement obligations under various prepetition agreements include the full amount drawn under the Golub LC, a $500 negotiation fee and accrued interest, along with JPMorgan’s costs and expenses, including its attorneys’ fees and expenses (collectively, the “Reimbursement Obligations”). JPMorgan calculates the

Reimbursement Obligations (and certain fees relating to the other letters of credit), as of September 27, 2012, to be $306,507.08 consisting of the $300,000 honored draw, $416.67 in interest on the $300,000 from the date of the honored demand, the $500 negotiation fee, $0.69 in interest on the $500 negotiation fee from the date of the demand, $2,089.72 in letter of credit fees,1 and $3,500.00 in estimated out-of-pocket expenses (including legal fees and expenses), and JPMorgan calculates the per diem interest amount at the pertinent rates to be $52.17. JPMorgan further asserts that the Reimbursement Obligations, as well as the Debtor’s reimbursement obligations under the other letters of credit, are fully secured by the Cash Collateral. 8. The Trustee, on behalf of the estate, wants to limit the extent of the estate’s

Reimbursement Obligations, including without limitation, the accrual of interest. Subject to this Court’s approval, the Trustee has accordingly agreed to seek limited relief from the automatic stay in order to permit JPMorgan to exercise its rights and remedies as a secured creditor (including, without limitation, setoff rights) in and to the Cash Collateral and, after doing so, to

1 Of this $2,089.72 in letter or credit fees, JPMorgan calculates that a total of $1,091.67 relates to the Golub LC, while the $998.05 balance relates to the other letters of credit.

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provisionally apply the commensurate amount of the Cash Collateral to the satisfaction of the Reimbursement Obligations in an amount not exceeding $306,507.08, plus the $52.17 interest per diem for each day after September 27, 2012 and through the first business day that such provisional application is permitted to occur pursuant to an unstayed Order of this Court. Notwithstanding JPMorgan’s exercise of its rights and remedies as a secured creditor (including setoff rights) in and to the Cash Collateral and its provisional application of the Cash Collateral in satisfaction of such Reimbursement Obligations, the Trustee and JPMorgan expressly preserve all of their respective claims, rights, defenses, powers, and remedies, including, without limitation, the Trustee’s right to subsequently challenge the amount and extent of JPMorgan’s application of such Cash Collateral in satisfaction of such Reimbursement Obligations and JPMorgan’s right to proceed against the Cash Collateral for the reimbursement of any additional out-of-pocket expenses (including attorneys’ fees and expense) incurred in defending any such challenge. Moreover, nothing in this agreed motion is intended to affect any of JPMorgan’s other claims, rights, defenses, powers, and/or remedies against the estate (including, without limitation, its rights against the Cash Collateral for reimbursement of any amount relating to the other letters of credit and for payment and/or performance of any of the other Liabilities) or any of the Trustee’s defenses with respect thereto. Provisional Relief from the Automatic Stay Is Warranted 9. By this Motion, the Trustee requests that this Court enter an order (i) approving

the Trustee’s agreement with JPMorgan to provisionally apply the commensurate amount of the Cash Collateral to the satisfaction of the Reimbursement Obligations in an amount not exceeding $306,507.08 plus the $52.17 interest per diem for each day after September 27, 2012 and through the first business day that such provisional application is permitted to occur pursuant to an

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unstayed Order of this Court and (ii) granting relief from the automatic stay in order for JPMorgan to exercise its rights and remedies as a secured creditor (including setoff rights) in and to the Cash Collateral so as to effectuate such provisional application, without prejudice to the parties’ respective rights regarding the extent, priority, and validity of JPMorgan’s secured or other claims against the Debtor’s estate. 10. The Trustee believes that this Court’s approval of JPMorgan’s provisional

application of the Cash Collateral and a corresponding grant of relief from the automatic stay are appropriate under the circumstances. The Trustee has undertaken a preliminary investigation of Golub’s right to draw the full amount of the Golub LC and JPMorgan’s rights in the Cash Collateral. Although the Trustee’s final determination regarding the extent of JPMorgan’s rights in the Cash Collateral is subject to further evaluation, the Trustee currently believes that JPMorgan is entitled to exercise remedies as a secured creditor, including setoff rights, in accordance with the operative documents. See Stephenson v. Salisbury (In re Corland Corp.), 967 F.2d 1069, 1076 (5th Cir. 1992) (the automatic stay does not defeat the right of setoff; rather, setoff is merely stayed pending an ‘orderly examination of the debtor’s and creditor’s rights.’”). Moreover, the Trustee is currently unaware of the existence of any security interest that would prime JPMorgan’s rights in the Cash Collateral. Consequently, the Trustee believes that cause exists to permit JPMorgan relief from the automatic stay to the extent necessary to permit the provisional application of the Cash Collateral described herein. In order to stop the accrual of the Reimbursement Obligations, including interest, pending the Trustee’s final evaluation of the extent of JPMorgan’s secured or other claims in this case, this Motion should be approved. Moreover, a waiver of the 14-day stay under Fed. R. Bankr. P. 4001(a)(3) is appropriate under the circumstances to avoid the accrual of additional obligations.

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Notice 11. Pursuant to Fed. R. Bankr. P. 4001(d), notice of this Motion has been given to the

Office of the United States Trustee and the parties requesting notice in this case. In light of the nature of the relief requested, the Trustee submits that no further or other notice is required. WHEREFORE, the Trustee requests the entry of an order, pursuant to 11 U.S.C. § 362(d) and Fed. R. Bankr. P. 4001(d), (a) approving the Trustee’s agreement with JPMorgan to provisionally apply the commensurate amount of the Cash Collateral to the satisfaction of the Reimbursement Obligations in an amount not exceeding $306,507.08, plus the $52.17 interest per diem for each day after September 27, 2012 and through the first business day such provisional application is permitted to occur pursuant to an unstayed Order of this Court; (b) granting relief from the automatic stay in order for JPMorgan to effectuate such provisional application of the Cash Collateral, without prejudice to the parties’ respective rights regarding the extent, priority, and validity of JPMorgan’s secured or other claims against the Debtor’s estate; (c) waiving the 14-day stay under Fed. R. Bankr. P. 4001(a)(3); and (d) granting such other and further relief as is just and equitable. Dated: September 28, 2012 Respectfully submitted, Ira Bodenstein, not personally, but as chapter 7 trustee for the estate of Peregrine Financial Group, Inc. By: Robert M. Fishman (#3124316) Mark L. Radtke (#6275738) Shaw Gussis Fishman Glantz Wolfson & Towbin LLC 321 North Clark Street, Suite 800 Chicago, Illinois 60654 Phone: (312) 541-0151 Fax: (312) 980-3888 /s/ Mark L. Radtke One of his attorneys

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