IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE ------------------------------------------------------------- X In re: MERVYNS HOLDINGS, LLC, et al.

, Debtors. Chapter 11 Case No.: 08-11586 (KG)

Hearing Date: August 26, 2008 at 10:00 a.m. Objection Deadline: August 22, 2008 at 11:59 p.m. For the Committee Related Doc. No. 142

------------------------------------------------------------- X LIMITED OBJECTION OF THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS TO DEBTORS APPLICATION TO EMPLOY AND RETAIN MILLER BUCKFIRE & CO., LLC AS FINANCIAL ADVISOR AND INVESTMENT BANKER The Official Committee of Unsecured Creditors (the Committee) of Mervyns Holdings, LLC and its affiliated debtors and debtors-in-possession (collectively, the Debtors) hereby submits this limited objection (this Limited Objection) to the Debtors Application to Employ and Retain Miller Buckfire & Co., LLC (Miller Buckfire) as Financial Advisor and Investment Banker (the Miller Buckfire Application) and respectfully represents as follows: BACKGROUND 1. On July 29, 2008, the Debtors filed voluntary petitions for relief under title 11 of

the United States Code (the Bankruptcy Code) in the United States Bankruptcy Court for the District of Delaware. Pursuant to sections 1107 and 1108 of the Bankruptcy Code, the Debtors are continuing to operate their businesses and their properties as debtors-in-possession. No trustee or examiner has been appointed in these cases. 2. On August 11, 2008, the Committee was appointed in these cases by the Office of

the United States Trustee for the District of Delaware, consisting of the following seven members: (i) Li & Fung USA; (ii) Levi Strauss & Co.; (iii) R.R. Donnelly & Sons Company; (iv)
1468655 v2/NY

0q/v((6

0811586080822000000000021

5o

VF Corporation; (v) The Macerich Company; (vi) DDR MDT MV Holdings II LLC; and (vii) The CIT Group/Commercial Services, Inc. On that same day, the Committee decided to employ Cooley Godward Kronish LLP as its lead counsel and BDO Seidman, LLP as its financial advisors. On August 14, 2008, the Committee decided to employ Ashby & Geddes, P.A. as its local counsel. 3. 142). LIMITED OBJECTION 4. The Committee does not object to the Debtors selection of Miller Buckfire as On August 8, 2008, the Debtors filed the Miller Buckfire Application (Dkt. No.

their financial advisor and investment banker. However, the Committee has expressed concerns over certain components of Miller Buckfires proposed compensation structure that have yet to be consensually resolved.1 These concerns were recently heightened when the Committee was advised that the Debtors anticipate retaining the services of a chief restructuring officer (a CRO). Some of the services that would typically be provided by a CRO may overlap with the services proposed to be provided to the Debtors by Miller Buckfire or may inherently encourage duplication of services.2 Accordingly, the Committee seeks nothing more at this time than a continuance of the hearing to consider the Miller Buckfire retention so that the Committee may be provided with a reasonable opportunity to consider the retentions of Miller Buckfire and any such CRO in the appropriate context.
1

As of the filing of this Limited Objection, the Committee and Miller Buckfire have had productive discussions regarding the scope of Miller Buckfires proposed compensation structure. The Committee anticipates continuing these discussions with Miller Buckfire in an attempt to resolve its concerns on a consensual basis in advance of the hearing. For example, many of the services Miller Buckfire anticipates providing to the Debtors are in the nature of financial advisory services, at least some of which a CRO would likely be charged with. See Miller Buckfire Application, 16 (services include advising and assisting the Debtors in structuring and effectuating financial aspects of a restructuring and providing financial advice and assistance to the Debtors in connection with a plan of reorganization).

1468655 v2/NY

5.

The Committee submits that neither it, the office of the United States Trustee (the

U.S. Trustee), nor this Court should be forced to evaluate the terms of Miller Buckfires retention without the benefit of information (which the Debtors have advised will be promptly provided) concerning the scope and compensation structure for any CRO sought to be retained. Rather, the best interests of the estates will clearly be served through a contemporaneous review of these retentions to ensure that the precious assets of these estates are employed in the most appropriate manner. Moreover, the Committee does not believe that a continuance of the hearing to consider Miller Buckfires retention would prejudice Miller Buckfire or these estates, as any order authorizing Miller Buckfires retention could presumably approve such retention on a nunc pro tunc basis. WHEREFORE, the Committee respectfully requests that this Court enter an order (i) continuing the hearing on the Miller Buckfire Application until such time as the Committee, the U.S. Trustee and other parties-in-interest have been provided with a sufficient opportunity to consider the terms of Miller Buckfires retention in conjunction with any CRO retention sought by the Debtors, and (ii) granting such additional relief as is just and proper.

[signatures on following page]

1468655 v2/NY

Dated: Wilmington, Delaware August 22, 2008

Respectfully Submitted, By: /s/ Karen B. Skomorucha William P. Bowden (I.D. No. 2553) Karen B. Skomorucha (I.D. No. 4759) ASHBY & GEDDES, P.A. 500 Delaware Avenue, 8th Floor Wilmington, DE 19801-1246 (302) 654-1888 (302) 654-2067 (Facsimile) Proposed Local Counsel For The Official Committee Of Unsecured Creditors Of Mervyns Holdings, LLC, et al. -andCOOLEY GODWARD KRONISH LLP 1114 Avenue of the Americas New York, New York 01136 (212) 479-6000 (212) 479-6275 (Facsimile) Jay R. Indyke (JI 0353) Cathy Hershcopf (CH 5875) Gregory G. Plotko (GP 9234) Seth Van Aalten (SV 2663) Proposed Lead Counsel For The Official Committee Of Unsecured Creditors Of Mervyns Holdings, LLC, et al.

1468655 v2/NY