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Full title: Notice of Hearing and Motion for an Order (I) Granting Expedited Relief, (II) Authorizing Debtor to Pay Certain Prepetition Taxes and Fees, (III) Authorizing Financial Institutions to Honor and Process Related Checks and Transfers. filed by Tea Olive I, LLC . An affidavit or verification, Memorandum of law, Proposed order. Hearing scheduled 1/13/2021 at 02:00 PM at *TELEPHONIC HEARING* with Judge William J. Fisher (St Paul). (Barbie MNBS) (Entered: 01/11/2021)

Document posted on Jan 10, 2021 in the bankruptcy, 23 pages and 0 tables.

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UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF MINNESOTA In re: Case No.: 21-30037 Tea Olive I, LLC d/b/a Stock+Field, Chapter 11 Case Debtor. NOTICE OF HEARING AND MOTION FOR AN ORDER (I) GRANTING EXPEDITED RELIEF, (II) AUTHORIZING DEBTOR TO PAY CERTAIN PREPETITION TAXES AND FEES, AND (III) AUTHORIZING FINANCIAL INSTITUTIONS TO HONOR AND PROCESS RELATED CHECKS AND TRANSFERS TO: The parties in interest as specified in Local Rule 9013-3(a)(2). 1. The above-captioned debtor and debtor in possession (together, the “Debtor”) hereby move this Court for the relief requested below and give notice of hearing. 2. The Court will hold a hearing on this Motion at 2:00 p.m. (CT) on Wednesday, January 13, 2021, in Courtroom 2B, 232 Warren E. Burger Federal Building and U.S. Courthouse, 316 North Robert Street, St. Paul, MN 55101. The hearing will be held telephonically: a. Dial 1-888-684-8852; b. When prompted, enter ACCESS CODE: 5988550; c. When prompted, enter SECURITY CODE: 0428. 3. Local Rule 9006-1(c) provides deadlines for responses to this Motion. However, given the expedited nature of the relief sought, the Debtor does not object to written responses being served and filed two hours prior to the hearing. UNLESS A RESPONSE OPPOSING THE MOTION IS TIMELY FILED, THE COURT MAY GRANT THE MOTION WITHOUT A HEARING.

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4. This Court has jurisdiction over this Motion pursuant to 28 U.S.C. §§ 157 and 1334, Rule 5005 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), and Local Rules 1070-1 and 1073-1. 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. The petition commencing this chapter 11 case was filed on January 10, 2021 (the “Filing Date”). The case is currently pending in this Court. 5. This Motion arises under sections 105(a), 363(b), 507(a)(8), and 541 of the Bankruptcy Code, and is filed under Local Rules 9013-1, 9013-2 and 9013-3. Expedited relief is requested pursuant to Bankruptcy Rule 9006(c) and Local Rule 9006-1(e). Notice of the hearing on this Motion is provided pursuant to Bankruptcy Rule 2002(a) and Local Rules 9013-3 and 2002-1(b). The Debtor seeks entry of an order granting expedited relief, and authorizing it to pay to the appropriate federal, state, and local taxing authorities and other governmental agencies, in the ordinary course of business, certain: (i) unpaid taxes accrued prior to the Filing Date, including employment and withholding taxes, sales and use taxes, and certain property taxes; and (ii) hunting, fishing, and firearm-related licensing, permit, and other fees. BACKGROUND 6. On the Filing Date, the Debtor filed a voluntary petition for relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”). The Debtor has continued in possession of its respective assets and the management of its business as a debtor-in-possession pursuant to Section 1107(a) and 1108 of the Bankruptcy Code. 7. Further general background information about the Debtor and this case is set forth in the Declaration of Matthew F. Whebbe in Support of Chapter 11 Petition and Initial Motions.

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The additional facts relevant to this Motion set forth below are verified by Matthew Whebbe, as evidenced by the attached verification. RELEVANT FACTS AND RELIEF RFEQUSTED 8. In connection with the normal operation of its business, the Debtor: (a) collects fees for customer purchases of: (i) hunting and fishing licenses and permits and (ii) firearm-related background checks; and (b) collects, withholds, and incurs sales and use taxes, employment and wage-related taxes, property taxes, and bonds (all such collected fees, taxes, and charges, collectively, the “Covered Taxes and Fees”).1 The Debtor remits the Covered Taxes and Fees to various federal, state and local governments, including taxing and licensing authorities (collectively, the “Governmental Authorities”). The Covered Taxes and Fees are remitted by the Debtor through checks and electronic transfers that are processed through its banks and other financial institutions. 9. The Debtor believes that many of the Covered Taxes and Fees collected prepetition are not property of the Debtor’s estate and must therefore be turned over to the Governmental Authorities. To the extent that they are not actually the property of the Governmental Authorities, they may well give rise to priority claims. Moreover, the Debtor also seeks to pay prepetition Covered Taxes and Fees in order to forestall the Governmental Authorities from taking actions that might interfere with the Debtor’s continued operations and the sale process, such as blocking the receipt or renewal of permits required for the Debtor’s continued operations or possibly bringing personal liability actions against directors, officers, and other employees in connection with non-payment of the Covered Taxes and Fees. Actions against the Debtor’s directors, officers, 1 The Debtor also incurs other taxes based on or measured by its net income (including, but not limited to, federal and state corporate income taxes), but this Motion does not pertain to such taxes.

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and other employees would likely distract key personnel, whose full-time attention to the Debtor’s efforts in this Chapter 11 case is required, and would likely cause business disruptions. Any such business disruptions would erode the Debtor’s customer base and negatively impact this chapter 11 case. Accordingly, the Debtor submits that the proposed relief is in the best interest of the Debtor’s estate. 10. Fees for Hunting, Fishing, and Firearm-Related Licenses, Permits, and Memberships. The Debtor is an authorized seller of hunting and fishing licenses and permits in the states in which the Debtor has retail stores. Customers who purchase such licenses and permits from the Debtor pay the related fee to the Debtor, and the Debtor is required to remit the fees to the applicable state and local Governmental Authorities under various schedules. In addition, in connection with firearms sales, the Debtor collects background check fees from customers, and is required to remit the fees (together with the hunting and fishing fees, the “Sports Fees”) to the applicable state and local Governmental Authorities. The Governmental Authorities regularly debit the Debtor’s accounts for the collected Sports Fees. As of the Filing Date, the Debtor estimates that it is holding less than $1,000 in Sports Fees that it must pay to the Governmental Authorities. If this Motion is approved, the Debtor intends to pay the Sports Fees to the appropriate Governmental Authorities. The Debtor generally also intends to pay to the appropriate Governmental Authorities any Sports Fees it collects after the Filing Date. 11. Sales and Use Taxes. The Debtor collects or incurs various general sales and use taxes in 5 states (the “Sales and Use Taxes”). The Debtor is required to remit these Sales and Use Taxes to the applicable Governmental Authorities on a periodic basis. As of the Filing Date, approximately $850,000 in Sales and Use Taxes had been incurred or collected by the Debtor and not yet remitted to the relevant Governmental Authorities. If this Motion is approved, the Debtor

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intends to pay any Sales and Use Taxes to the appropriate Governmental Authorities. The Debtor generally also intends to pay to the appropriate Governmental Authorities any Sales and Use Taxes that arise after the Filing Date. 12. Employment and Wage-Related Taxes. The Debtor is required by law to withhold from domestic employees’ wages or pay directly various amounts related to federal, state and local taxes. These taxes include, but are not limited to, income taxes, FICA Taxes (as defined below), certain unemployment benefits for the Debtor’s employees and amounts held in respect of unemployment-related fees, and similar state, local and federal taxes that accrue on wages, benefits, disability and workers’ compensation paid to the Debtor’s employees (collectively, the “Employment and Wage-Related Taxes”). The Debtor pays the Employment and Wage-Related Taxes to various Governmental Authorities in accordance with the Internal Revenue Code and applicable state and local laws. 13. Specifically, pursuant to section 3402 of the Internal Revenue Code and various state and local laws, all employers generally are required to withhold income taxes on wages paid to employees. The Debtor’s current practice is to pay—via PEOPLE Etc., its payroll provider—the withheld income tax amounts on employee wages to the appropriate Governmental Authorities on a biweekly basis. 14. The Federal Insurance Contributions Act (“FICA”) requires employers to pay an old-age, survivors and disability tax and a hospital insurance tax on wages paid to employees and to withhold from such wages a separate old-age, survivors, and disability tax and hospital insurance tax (“FICA Taxes”). See I.R.C. §§ 3102, 3111. The employer portion of FICA Taxes and the separate employee portion of FICA Taxes generally arise when employee wages are paid, and employers, such as the Debtor, are obligated to pay such taxes to the applicable Governmental

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Authorities promptly thereafter. See I.R.C. §§ 3101 and 3111. The Debtor’s current practice is to pay—via PEOPLE Etc., its payroll provider—such amounts to the appropriate Governmental Authorities on a biweekly basis. Consistent with the income taxes and FICA Taxes, the Debtor’s current practice is to pay—again, via PEOPLE Etc., its payroll provider—all other Employment and Wage-Related Taxes to the appropriate Governmental Authorities. 15. Although it is difficult to assess precisely the amount of Employment and Wage-Related Taxes that have been or will be withheld on account of prepetition services, the Debtor estimates that its next obligation to remit such taxes will be in the amount of approximately $27,000. If this Motion is approved, the Debtor intends to pay all withheld Employment and Wage-Related Taxes as they come due. 16. Contemporaneously herewith, the Debtor has filed a motion seeking, among other things, authorization to continue to pay prepetition wages, salaries and other compensation to employees. The postpetition payment of prepetition wages, salaries and other compensation will result in additional withholding of and direct payment obligations for various Employment and Wage-Related Taxes as described above, for which authorization for remittance to the appropriate Governmental Authorities is also requested by this Motion.2 17. Property Taxes. The Debtor has property tax obligations to certain Governmental Authorities, including, without limitation, for personal property and certain leased real property pursuant to the relevant leases (collectively, the “Property Taxes”). It is critical that the Debtor is authorized to pay any Property Taxes, particularly where under applicable law the failure to pay gives rise to a secured state law lien. 2 Pursuant to the CARES Act, the Debtor has deferred approximately $800,000 in pre-petition taxes. In this Motion, the Debtor is not seeking authority to pay the $800,000 in deferred pre-petition taxes.

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18. The Debtor’s current practice generally is to pay such amounts to the appropriate Governmental Authorities on various dates during the year, and no later than when they become due. Interest and penalties accrue if such Property Taxes are not timely paid. Timely paying these Property Taxes, therefore, will reduce costs by minimizing interest and penalty charges. The Debtor estimates that it owes approximately $640,945 for such real and personal property tax obligations that arose prepetition but are unpaid and come due after the Filing Date 19. Bonds. The Debtor additionally is required by applicable law to post bonds in connection with its vehicle sales and trailer rentals. In connection with this obligation, the Debtor has posted bonds in the total amount of approximately $900,000 to approximately 23 state and local Governmental Authorities. It is critical that the Debtor be authorized to continue to allow the Governmental Authorities to hold these bonds (and for the Debtor to pay any additional requested bonds)in a timely manner) in order to prevent violations of applicable laws. REQUEST FOR AUTHORITY FOR BANKS TO HONOR AND PROCESS RELATED CHECKS AND TRANSFERS 20. The Debtor also requests that all applicable banks be authorized to receive, process, honor, and pay all checks presented for payment of, and to honor all fund transfer requests made by the Debtor related to the claims that the Debtor requests authority to pay in this Motion, regardless of whether the checks were presented or fund transfer requests were submitted before or after the Filing Date, provided that: (a) funds are available in the Debtor’s accounts to cover the checks and fund transfers and (b) all the banks are authorized to rely on the Debtor’s designation of any particular check as approved by the proposed order. 21. Nothing in this Motion should be construed as impairing the Debtor’s right to contest the validity or amount of the Covered Taxes and Fees assessed by the Governmental Authorities, and the Debtor expressly reserves all of its rights with respect thereto.

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22. Based upon the foregoing, the Debtor submits that the relief requested herein is essential, appropriate, and in the best interest of the Debtor’s estate and creditors. Absent this relief, the value of the Debtor’s estate will suffer, possibly precipitously. Consequently, all of the Debtor’s creditors will benefit if the requested relief is granted. EXPEDITED RELIEF 23. The Debtor requests expedited relief on this Motion. Previously and concurrently herewith the Debtor has scheduled and served a number of initial motions designed to facilitate an orderly transition to chapter 11. The granting of this Motion on an expedited basis will enable the Debtor to remain current on its outstanding tax and license obligations so that federal or state-by-state involvement in this bankruptcy case does not unduly delay and complicate the process. 24. Pursuant to Local Rule 9013-2, this Motion is verified and is accompanied by a Memorandum of Law, proposed order and proof of service. 25. Pursuant to Local Rule 9013-2, the Debtor gives notice that it may, if necessary, call one or more of the following to testify regarding the facts set forth in this Motion: (a) Matthew Whebbe, the Chief Executive Officer of the Debtor, whose business address is 2600 Eagan Woods Drive, Suite 120, Eagan, MN 55121 and (b) Michael Wesley, a Partner at Clear Thinking Group, the Chief Restructuring Officer and Financial Advisor to the Debtor, whose business address is 401 Towne Centre Drive, Hillsborough, NJ 08844. REQUEST FOR WAIVER OF STAY 26. In addition, by this Motion, the Debtor seeks a waiver of any stay of the effectiveness of the order approving this Motion. Pursuant to Bankruptcy Rule 6004(h), “[a]n order authorizing the use, sale, or lease of property other than cash collateral is stayed until the expiration of 14 days after entry of the order, unless the court orders otherwise.” As discussed

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above, the Debtor requires immediate relief to continue ordinary business operations for the benefit of all parties in interest. Accordingly, the Debtor submits that ample cause exists to justify a waiver of the 14-day stay imposed by Bankruptcy Rule 6004(h), to the extent that it applies. NO PREVIOUS REQUEST 27. No previous request for the relief sought herein has been made by the Debtor to this or any other court. WHEREFORE, the Debtor respectfully moves the Court for an order A. Granting expedited relief; B. Authorizing the Debtor to pay the Covered Taxes and Fees, whether relating to the period before or after the Filing Date, to the Governmental Authorities; C. Authorizing the banks to honor and process related checks and transfers; D. Granting relief from the 14-day stay under Bankruptcy Rule 6004, to the extent it applies; and E. Granting such other and further relief as the Court may deem just and equitable. Dated: January 11, 2021 /e/ Samuel M. Andre Clinton E. Cutler (#0158094) James C. Brand (#0387362) Steven R. Kinsella (#0392289) Samuel M. Andre (#0399669) FREDRIKSON & BYRON, P.A. 200 South Sixth Street, Suite 4000 Minneapolis, MN 55402-1425 (612) 492-7000 ccutler@fredlaw.com jbrand@fredlaw.com skinsella@fredlaw.com sandre@fredlaw.com PROPOSED ATTORNEYS FOR THE DEBTOR

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VERIFICATION I, Matthew Whebbe, the Chairman and Chief Executive Officer of Tea Olive I, LLC (the “Debtor”), declare under penalty of perjury that the facts set forth in the preceding motion are true and correct according to the best of my knowledge, information, and belief, including based on information provided to me by other representatives of the Debtor and the Debtor’s professional advisors. Dated: January 10, 2021 Matthew Whebbe

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UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF MINNESOTA In re: Case No.: 21-30037 Tea Olive I, LLC d/b/a Stock+Field, Chapter 11 Case Debtor. MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR AN ORDER (I) GRANTING EXPEDITED RELIEF, (II) AUTHORIZING DEBTOR TO PAY CERTAIN PREPETITION TAXES AND FEES, AND (III) AUTHORIZING FINANCIAL INSTITUTIONS TO HONOR AND PROCESS RELATED CHECKS AND TRANSFERS Tea Olive I, LLC d/b/a Stock+Field, (the “Debtor”) submits this memorandum of law in support of the motion submitted herewith (the “Motion”) in accordance with Local Rule 9013-2(a). The Debtor seeks the entry of an order substantially in the form filed herewith (i) granting expedited relief, (ii) authorizing the Debtor to pay certain prepetition taxes and fees, and (iii) authorizing financial institutions to honor and process related checks and transfers. The Motion should be granted because certain of the amounts involved are trust fund taxes, so not property of the Debtor’s estate, and the Debtor has a compelling business justification for payment of these obligations. This relief will avoid delays in payment of postpetition obligations and ensure as smooth a transition as possible into chapter 11. The Court should therefore grant the relief sought. BACKGROUND The supporting facts are set forth in the verified Motion. All capitalized terms used herein and not otherwise defined shall have the meanings ascribed to them in the Motion.

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LEGAL ANALYSIS I. THE DEBTOR’S REQUEST FOR EXPEDITED RELIEF SHOULD BE GRANTED. The Debtor requests expedited relief on the Motion. Local Rule 9006-1(b) provides that “moving documents shall be filed and served . . . not later than fourteen days before the hearing date.” Local Rule 9006-1(e), however, provides that a court may reduce the notice for cause. Cause exists here to grant the Motion on an expedited basis. The granting of this Motion on an expedited basis will enable the Debtor to remain current on its outstanding tax obligations and obligations to remit collected fees to various governmental authorities so that federal, state-by-state, or locality-by-locality involvement in this bankruptcy case does not unduly delay and complicate the process. If expedited relief is not granted and the Debtor is not able to remain current on such obligations, it is possible that Governmental Authorities would take actions that might interfere with the Debtor’s success in this case, such as blocking the receipt or renewal of permits required for the Debtor’s continued operations, drawing upon bonds, terminating the Debtor’s rights to make hunting and fishing licenses and permits available to customers, or possibly bringing personal liability actions against directors, officers, and other employees in connection with non-payment of the Covered Taxes and Fees. Actions against the Debtor’s directors, officers, and other employees would likely distract key personnel, whose full-time attention to the Debtor’s reorganization efforts is required and would likely cause potential business disruptions. Any such business disruptions would likely erode the Debtor’s customer base and negatively impact this chapter 11 case. Accordingly, expedited relief requested is necessary to avoid immediate and irreparable harm, and cause exists to reduce the notice period of the Motion.

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II. THE COURT HAS AUTHORITY TO APPROVE POSTPETITION PAYMENT OF PREPETITION TAX OBLIGATIONS. Section 105(a) of the Bankruptcy Code empowers the Court to “issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title.” 11 U.S.C. § 105(a). A bankruptcy court’s use of its equitable powers to “authorize the payment of pre-petition debt when such payment is needed to facilitate the rehabilitation of the debtor is not a novel concept.” In re Ionosphere Clubs, Inc., 98 B.R. 174, 175 (Bankr. S.D.N.Y. 1989). “Courts have used their equitable power under section 105(a) of the Code to authorize the payment of pre-petition claims when such payment is deemed necessary to the survival of a debtor in a chapter 11 reorganization.” In re Just for Feet, Inc., 242 B.R. 821, 824 (D. Del. 1999). In a long line of well-established cases, federal courts have consistently permitted postpetition payment of prepetition obligations where necessary to preserve or enhance the value of a debtor’s estate for the benefit of all creditors. See, e.g., Miltenberger v. Logansport Ry., 106 U.S. 286, 312 (1882) (payment of pre-receivership claim prior to reorganization permitted to prevent “stoppage of [crucial] business relations”); In re Payless Cashways, Inc., 268 B.R. 543, 546 (Bankr. W.D. Mo. 2001); see also In re Lehigh and N.E. Ry. Co., 657 F.2d 570, 581 (3d Cir. 1981); In re Just for Feet, Inc., 242 B.R. at 825 (“The Supreme Court, the Third Circuit and the District of Delaware all recognize the court’s power to authorize payment of pre-petition claims when such payment is necessary for the debtor’s survival during chapter 11.”). This “doctrine of necessity” functions in a chapter 11 reorganization as a mechanism by which the bankruptcy court can exercise its equitable power to allow payment of critical prepetition claims not explicitly authorized by the Bankruptcy Code. See In re Bos. & Me. Corp., 634 F.2d 1359, 1382 (1st Cir. 1980) (recognizing the existence of a judicial power to authorize trustees to pay claims for goods and services that are indispensably necessary to the debtors’ continued

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operation); In re Payless Cashways, Inc., 268 B.R. at 546; see also In re Just for Feet, Inc., 242 B.R. at 824 (“While this doctrine [of necessity] was not codified in the Bankruptcy Code, courts have used their equitable power under Section 105(a) of the Code to authorize the payment of prepetition claims . . . .”); In re United Am., Inc., 327 B.R. 776, 781 (Bankr. E.D. Va. 2005) (recognizing the doctrine of necessity as an equitable doctrine). The doctrine is frequently invoked early in a reorganization, particularly in connection with those chapter 11 sections that relate to payment of prepetition claims. The court in In re Structurelite Plastics Corp., 86 B.R. 922, 931 (Bankr. S.D. Ohio 1988), indicated its accord with “the principle that a bankruptcy court may exercise its equity powers under § 105(a) to authorize payment of pre-petition claims where such payment is necessary to ‘permit the greatest likelihood of survival of the debtor and payment of creditors in full or at least proportionately.’” The court stated that “a per se rule proscribing the payment of pre-petition indebtedness may well be too inflexible to permit the effectuation of the rehabilitative purposes of the Code.” Id. at 932 (emphasis in original). Accordingly, pursuant to section 105(a) of the Bankruptcy Code, this Court is empowered to grant the relief requested herein. III. POSTPETITION PAYMENT OF CERTAIN PREPETITION TAX OBLIGATIONS IS APPROPRIATE IN THIS CASE. A. Certain of the Covered Taxes and Fees are Not Property of the Debtor’s Estate. Certain of the Covered Taxes and Fees are collected or withheld by the Debtor on behalf of the applicable Governmental Authorities and are held in trust by the Debtor. See, e.g., I.R.C. § 7501 (stating that certain Covered Taxes and Fees are held in trust). As such, these Covered Taxes and Fees are not property of the Debtor’s estate under section 541 of the Bankruptcy Code. See, e.g., Begier v. I.R.S., 496 U.S. 53, 59 (1990) (stating that withholding taxes are property held

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by debtor in trust for another and, as such, are not property of debtor’s estate); Tex. Comptroller of Pub. Accounts v. Megafoods Stores, Inc. (In re Megafood Stores, Inc.), 163 F.3d 1063, 1067-69 (9th Cir. 1998) (determining that under Texas law, state sales taxes collected created statutory trust fund, if traceable, and were not property of the estate); Al Copeland Enter., Inc. v. Tex. (In re Al Copeland Enter., Inc.), 991 F.2d 233, 235-37 (5th Cir. 1993) (holding that debtors’ prepetition collection of sales taxes and interest thereon were held subject to trust and were not property of the estate); Shank v. Wash. State Dept. of Revenue, Excise Tax Div. (In re Shank), 792 F.2d 829, 830 (9th Cir. 1986) (concluding that sales taxes required by state law to be collected by sellers from their customers are “trust fund” taxes); DeChiaro v. N.Y. State Tax Comm’n, 760 F.2d 432, 433-34 (2d Cir. 1985) (concluding that sales taxes are “trust fund” taxes); In re Am. Int’l Airways, Inc., 70 B.R. 102, 103 (Bankr. E.D. Pa. 1987) (holding that excise and withholding taxes are “trust fund” taxes); Shipley Co. v. Darr (In re Tap, Inc.), 52 B.R. 271, 277 (Bankr. D. Mass. 1985) (finding that withholding taxes are “trust fund” taxes); see generally Official Comm. of Unsecured Creditors of the Columbia Gas Transmission Corp. v. Columbia Gas Sys. Inc. (In re Columbia Gas Sys. Inc.), 997 F.2d 1039, 1060 (3d Cir. 1993) (indicating that even if the statute does not establish an express trust, a constructive trust may be found). Because certain of the Covered Taxes and Fees are not property of the Debtor’s estate, such funds are not available for the satisfaction of creditors’ claims and are the property of the relevant Governmental Authorities. B. Certain of the Covered Taxes and Fees are Priority Claims. To the extent any amounts in respect to the Covered Taxes and Fees are property of the estate under section 541 of the Bankruptcy Code, many claims related to those amounts would likely be afforded priority status under section 507(a)(8) of the Bankruptcy Code. As priority claims, those portions of the Covered Taxes and Fees must be paid in full before any general

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unsecured obligations of the Debtor can be satisfied. The Debtor believes that sufficient assets will exist to pay all priority Covered Taxes and Fees in full under any plan that may ultimately be proposed and confirmed by this Court. Accordingly, to the extent the Covered Taxes and Fees are property of the Debtor and give rise to priority claims, the relief requested will only affect the timing of the payment of these priority Covered Taxes and Fees and will not prejudice the rights of general unsecured creditors. In this respect, it should be noted that obligations labeled as “fees” or “charges” may also be entitled to priority status as taxes. See 11 U.S.C. § 507(a)(8). A fee or charge is a tax if it is an involuntary pecuniary burden: (i) laid upon the individual or their property, (ii) imposed by or under authority of a legislative body, (iii) assumed for public purposes, including the purposes of defraying expenses of government or undertakings authorized by it, and (iv) assessed under the police or taxing power of the state. See LTV Steel Co. v. Shalala (In re Chateaugay Corp.), 53 F.3d 478, 498 (2d Cir. 1995). Many of the Covered Taxes and Fees are involuntary pecuniary burdens imposed by the authority of a federal, state or local legislature under its police or taxing power. Regardless of their statutory characterization as “fees” or “charges,” many of the claims in respect to the Covered Taxes and Fees may well qualify for priority under section 507(a)(8) of the Bankruptcy Code and, as such, must be paid in full before any general unsecured obligations of a debtor may be satisfied. Thus, payment of these Covered Taxes and Fees will only affect the timing of the payment and will not prejudice the rights of the general unsecured creditors of the estate. C. Non-Payment of Certain Covered Taxes and Fees Would Cause Immediate and Irreparable Harm to the Debtor’s Estate. The Covered Taxes and Fees include amounts collected from customers for the sale of hunting and fishing licenses and permits. The Debtor is required to remit such amounts to the

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appropriate Governmental Authorities. If the Debtor fails to do so, the Governmental Authorities may terminate the Debtor’s authorization to sell such licenses and permits, which would likely reduce customer traffic into the stores. In addition, many federal and state statutes hold certain directors, officers and other employees of entities responsible for collecting or withholding taxes, or remitting certain taxes, personally liable for these types of taxes. See, e.g., I.R.C. § 6672 (imposing personal liability in connection with non-payment of employment taxes described above). To the extent such Covered Taxes and Fees were incurred by the Debtor before the Filing Date and are not remitted or paid by the Debtor, certain of the Debtor’s directors, officers, and other employees may be subject to lawsuits during the pendency of this chapter 11 case. Payment of the Covered Taxes and Fees will avoid director and employee loss of focus and morale resulting from the risk of personal liability. A lawsuit and any ensuing liability would distract personnel from important tasks, to the detriment of all parties in interest in this chapter 11 case. The dedicated and active participation of the Debtor’s directors, officers, and other employees is not only integral to the Debtor’s continued, uninterrupted operations, but is also essential to its successful reorganization. As described above and in the Motion, payment of certain of the prepetition Covered Taxes and Fees is critical to the Debtor’s continued, uninterrupted operations and to avoid immediate and irreparable harm to the Debtor’s estate. Non-payment of the Covered Taxes and Fees may cause certain Governmental Authorities to take precipitous action, including, but not limited to, conducting audits, filing liens, pursuing payment of the Covered Taxes and Fees from the Debtor’s directors, officers and other employees, and seeking to lift the automatic stay, any of which would disrupt the Debtor’s day-to-day operations and could potentially impose significant costs and burdens on the Debtor’s estate. Prompt payment of the Covered Taxes and Fees will avoid these

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unnecessary and potentially costly governmental actions. See In re FCC, 217 F.3d 125, 137 (2d Cir. 2000). Accordingly, to the extent the relief requested herein involves the use of property of the estate and Bankruptcy Rule 6003 is applicable, the requested relief is consistent with the Rule because failure to pay the Covered Taxes and Fees would cause immediate and irreparable harm to the Debtor. D. Substantial Precedent Exists for Authorizing Payment of Prepetition Taxes. In numerous chapter 11 cases in this and other districts, courts have authorized debtors to pay similar prepetition tax obligations. See, e.g., In re SCICOM Data Services, Ltd., No. 13-43894 (MER) (Bankr. D. Minn. Aug. 20, 2013) No. ECF No. 20; In re Genmar Holdings, Inc., No. 09-43537 (KAC) (Bankr. D. Minn. June 4, 2009), ECF No. 21; In re Polaroid Corp., No. 08-46617 (GFK) (Bankr. D. Minn. Dec. 23, 2008), ECF No. 22; see also In re Quicksilver Res. Inc., No. 15-10585 (LSS) (Bankr. D. Del. Mar. 20, 2015), ECF No. 101; In re RadioShack Corp., 15-10197 (BLS) (Bankr. D. Del. Feb. 9, 2015), ECF No. 164. The Debtor submits that the circumstances described herein warrant similar relief. Section 363(b)(1) of the Bankruptcy Code empowers the Court to allow the debtor to “use, sell, or lease, other than in the ordinary course of business, property of the estate.” 11 U.S.C. § 363(b)(1). The Debtor’s decisions to use, sell or lease assets outside the ordinary course of business must be based upon the sound business judgment of the debtor. In re Montgomery Ward Holding Corp., 242 B.R. 147, 153 (D. Del. 1999); see also In re Chateaugay Corp., 973 F.2d 141, 143, 145 (2d Cir. 1992) (holding that a judge determining a section 363(b) application must find from the evidence presented before him or her a good business reason to grant such application); see also In re Glob. Crossing Ltd., 295 B.R. 726, 743 (Bankr. S.D.N.Y. 2003); In re Channel One Comm., Inc., 117 B.R. 493, 496 (Bankr. E.D. Mo. 1990) (citing Comm. of Equity Sec. Holders v.

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Lionel Corp. (In re Lionel Corp.), 722 F.2d 1063, 1071 (2d Cir. 1983)); In re Ionosphere Clubs, Inc., 100 B.R. 670, 674 (Bankr. S.D.N.Y. 1989) (noting the standard for determining a section 363(b) motion is “a good business reason”). Courts emphasize that the business judgment rule is not an onerous standard and may be satisfied “‘as long as the proposed action appears to enhance the debtor’s estate.’” Crystalin, LLC v. Selma Props. Inc. (In re Crystalin, LLC), 293 B.R. 455, 463-64 (B.A.P. 8th Cir. 2003) (quoting Four B. Corp. v. Food Barn Stores, Inc. (In re Food Barn Stores, Inc.), 107 F.3d 558, 566 n.16 (8th Cir. 1997) (emphasis in original, internal alterations and quotations omitted)); see also In re AbitibiBowater, 418 B.R. 815, 831 (Bankr. D. Del. 2009) (the business judgment standard is “not a difficult standard to satisfy”). Under the business judgment rule, management of a corporation’s affairs is placed in the hands of its board of directors and officers, and the Court should interfere with their decisions only if it is made clear that those decisions are, inter alia, clearly erroneous, made arbitrarily, are in breach of the officers’ and directors’ fiduciary duty to the corporation, are made on the basis of inadequate information or study, are made in bad faith, or are in violation of the Bankruptcy Code. In re Farmland Indus., Inc., 294 B.R. 855, 881 (Bankr. W.D. Mo. 2003) (citing In re United Artists Theatre Co., 315 F.3d 217, 233 (3d Cir. 2003), Richmond Leasing Co. v. Capital Bank, N.A., 762 F.2d 1303, 1309 (5th Cir. 1985), and In re Defender Drug Stores, Inc., 145 B.R. 312, 317 (B.A.P. 9th Cir. 1992) (emphasis in original)). The Debtor submits that to the extent the use of property of the estate is implicated here, the actions for which relief is requested represent a sound exercise of the Debtor’s business judgment and are justified under section 363(b), as well as under section 105(a), of the Bankruptcy Code. As noted above, if the Covered Taxes and Fees are not paid, the Governmental Authorities could take actions that could be costly and distracting to the Debtor and interfere with the Debtor’s

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ability to succeed in this case and maximize value for creditors, which would negatively affect all of the Debtor’s creditors and employees, and other parties in interest. Moreover, because most of the Covered Taxes and Fees either (i) are “trust fund” taxes, and are therefore not property of the Debtor’s estate, or (ii) would be afforded priority status under section 507(a)(8) of the Bankruptcy Code, the Debtor’s general unsecured creditors would not be prejudiced by the Court’s granting of the relief requested herein. III. WAIVER OF STAY IS WARRANTED. Pursuant to Bankruptcy Rule 6004(h), “[a]n order authorizing the use, sale, or lease of property other than cash collateral is stayed until the expiration of 14 days after entry of the order, unless the court orders otherwise.” As set forth in the Motion, the Debtor requires immediate relief to continue ordinary business operations for the benefit of all parties in interest, including the safety of in-store customers and employees. Accordingly, the Debtor submits that ample cause exists to justify a waiver of the 14-day stay imposed by Bankruptcy Rule 6004(h), to the extent that it applies. CONCLUSION For the foregoing reasons, the Debtor respectfully requests that the Court grant the relief requested in the Motion.

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Dated: January 11, 2021 /e/ Samuel M. Andre Clinton E. Cutler (#0158094) James C. Brand (#0387362) Steven R. Kinsella (#0392289) Samuel M. Andre (#0399669) FREDRIKSON & BYRON, P.A. 200 South Sixth Street, Suite 4000 Minneapolis, MN 55402-1425 (612) 492-7000 ccutler@fredlaw.com jbrand@fredlaw.com skinsella@fredlaw.com sandre@fredlaw.com PROPOSED ATTORNEYS FOR THE DEBTOR 71724944 v3

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SUNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF MINNESOTA In re: Case No.: 21-30037 Tea Olive I, LLC d/b/a Stock+Field, Chapter 11 Case Debtor. ORDER GRANTING EXPEDITED RELIEF AND AUTHORIZING DEBTOR TO PAY CERTAIN PREPETITION TAXES AND FEES This case came before the court on the Motion for Order (I) Granting Expedited Relief; (II) Authorizing Debtor to Pay Certain Prepetition Taxes and Fees, and (III) Authorizing Financial Institutions to Honor and Process Related Checks and Transfers (the “Motion”) filed by the above-captioned debtor (the “Debtor”). Based on the Motion and the record, IT IS ORDERED: 1. The Motion is granted, including the request for expedited relief. 2. The Debtor is authorized, but not required, to pay, in its sole discretion, the (a) fees for customer purchases of: (i) hunting and fishing licenses and permits and (ii) firearm-related background checks; and (b) collects, withholds, and incurs sales and use taxes, employment and wage-related taxes, property taxes, and bonds (all such collected fees, taxes, and charges, collectively, the “Covered Taxes and Fees”), whether relating to the period before or after January 10, 2021 (the “Filing Date”), to the federal, state, and local governments, including taxing and licensing authorities. 3. All applicable banks and financial institutions are hereby authorized to receive, process, honor and pay any and all checks, drafts, wires, check transfer requests or automated clearing house transfers evidencing amounts paid by the debtor under this order whether presented

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prior to or after the Filing Date to the extent the debtor has good funds standing to its credit with such bank or other financial institution. Such banks and financial institutions are authorized to rely on the representations of the Debtor as to which checks are issued or authorized to be paid pursuant to this order without any duty of further inquiry and without liability for following the debtor’s instructions. 4. Notwithstanding anything to the contrary contained in this order, any payment made or to be made under this order, any authorization contained in this order, or any claim for which payment is authorized hereunder, shall be subject to any orders of this court approving any use of cash collateral by the debtor and any budget governing use of cash collateral. 5. Nothing in this order shall be construed as impairing the debtor’s right to contest the validity or amount of any Covered Taxes and Fees assessed by the federal, state, and local governments, including taxing and licensing authorities, and all of the Debtor’s rights with respect thereto are hereby reserved. 6. Notwithstanding the possible applicability of Fed. R. Bankr. P. 6003 and 6004(h), the terms and conditions of this order shall be immediately effective and enforceable upon its entry Dated: William J. Fisher United States Bankruptcy Judge 71732204