IN RE SK HAND TOOL CORPORATION

EUGENE WEDOFF, Bankruptcy Judge

TOTAL FEES REQUESTED: $17,712.50 TOTAL COSTS REQUESTED: $2,242.96 TOTAL FEES REDUCED: $3,094.37 TOTAL COSTS REDUCED: $128.54 TOTAL FEES ALLOWED: $14,618.13 TOTAL COSTS ALLOWED: $2,114.42

The attached time and expense entries have been underlined to reflect disallowance in whole or in part. The basis for each disallowance is reflected by numerical notations that appear on the left of each underlined entry. The numerical notations correspond to the enumerated paragraphs below.

The Court denies the allowance in part of compensation for the following task since the professional or paraprofessional expended an unreasonable amount of time on this task in light of the nature of the task, the experience and knowledge of the professional performing the task, and the amount of time previously expended by the professional or another on the task. In re Pettibone, 74 B.R. 293, 306 (Bankr. N.D. Ill. 1987) ("The Court will determine what is the reasonable amount of time an attorney should have to spend on a given project . . . An attorney should not be rewarded for inefficiency. Similarly, attorneys will not be fully compensated for spending an unreasonable number of hours on activities of little benefit to the estate."); In re Wildman, 72 B.R. 700, 713 (Bankr. N.D. Ill. 1987) (same).

As to the time devoted to the preparation of the fee application itself, the Court denies the allowance of compensation that is disproportionate to the total hours in the main case. In re Wildman, 72 B.R. 700, 711 (Bankr. N.D. Ill. 1987) ("In the absence of unusual circumstances, the hours allowed by this Court for preparing and litigating the attorney fee application should not exceed three percent of the total hours in the main case."); In re Spanjer Bros., Inc., 203 B.R. 85, 93 (Bankr. N.D. Ill. 1996) (compensation limited to 5%). See also In re Pettibone Corp., 74 B.R. 293, 304 (Bankr. N.D. Ill. 1987) (citing Coulter v. State of Tennessee, 805 F.2d 146, 151 (6th Cir. 1986) (in non-bankruptcy cases, compensation for preparation and litigation of fee petitions limited to 3-5% of the hours of the main case)).

The Court denies the allowance of compensation for the following task since the description of the time entry fails to identify in a reasonable manner the service rendered. In re Pettibone, 74 B.R. 293, 301 (Bankr. N.D. Ill. 1987) ("A proper fee application must list each activity, its date, the attorney who performed the work, a description of the nature and substance of the work performed, and the time spent on the work. [Citation omitted] Records which give no explanation of the activities performed are not compensable."); In re Wildman, 72 B.R. 700, 708-9 (Bankr. N.D. Ill. 1987) (same).

The Court denies reimbursement for fees or expenses that are overhead costs. Expenses which are overhead are not compensable because they are built into the hourly rate. See In re Wildman, 72 B.R. 700, 731 (Bankr. N.D. Ill. 1987). Overhead, for bankruptcy purposes, includes "all continuous administrative or general costs or expenses incident to the operation of the firm which cannot be attributed to a particular client or cost." In re Convent Guardian Corp., 103 B.R. 937, 939-40 (Bankr. N.D. Ill. 1989) (quoting In re Thacker, 48 B.R. 161, 164 (Bankr. N.D. Ill. 1985)).

Dated: January 4, 2011 NEAL, GERBER EISENBERG LLP November 16, 2010 Invoice 175505 EXPENSE SUMMARY Statement No: 175505 For professional services rendered with regard to: Re: Case Administration DISBURSEMENTS Sep 3, 2010 C. J. Troxel Westlaw Research 110.89 MAY, ANDREW G 7224182 — Research proper method for perfecting a security interest in a patent or trademark in the Seventh Circuit Oct 1, 2010 M. A. Berkoff LexisNexis Accurint Online 17.65 Research 9/9/10 — research by CPH regarding current location of two former company executives Oct 5, 2010 C. J. Troxel Reproduction of Documents 6.00 Oct 6, 2010 M. A. Berkoff Service of Summons/Subpoena — 170.00 It's Your Serve rush service on Cliff Rusnak and Claude Fuger Oct 8, 2010 M. A. Berkoff Chicago Messenger Services 27.49 Invoice Number: 544773 Invoice Date: 10/10/10 Oct 21, 2010 M. A. Berkoff Filing Fee — CT Corporation 740.35 System state lien searches for MCC Business Inc. and SK Hand Tool Corporation Oct 27, 2010 M. A. Berkoff Conference Call Charge — C3 36.57 Conferencing, Inc. conference call charges per N. Miller 9/1 and 9/8/10 Statement No: 175505 For professional services rendered with regard to: Re: Case Administration Oct 1, 2010 MAB Review e-mails. 0.10 64.50 Oct 1, 2010 NMM Conference with C. McManus 0.20 79.00 regarding issues related to general case direction (.20). Oct 19, 2010 MAB Office conference with N. Miller 0.10 64.50 regarding today's court, next steps and timing. Oct 19, 2010 NTB Circulate September invoice to 0.20 48.00 Committee. Oct 21, 2010 NTB Docket review (.1) draft and send 0.20 48.00 docketing request (.1). Oct 26, 2010 NTB Docket review (.1) draft and send 0.20 48.00 docketing request (.1). Oct 28, 2010 NTB Docket review (.1) draft and send 0.20 48.00 docketing request (.1). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.20 645.00 $129.00 N. M. Miller 0.20 395.00 $79.00 N. Taylor Brody 0.80 240.00 $192.00 TOTAL HOURS 1.20 TOTAL FEES $400.00 TOTAL FEES $400.00 Statement No: 175505 For professional services rendered with regard to: Re: Meetings Oct 4, 2010 MAB Office conference with N. Miller to 0.20 129.00 discuss case status, talks with PBGC, Webster's claim, next steps and strategy. Oct 4, 2010 NMM Conference with C. Hanson (PBGC) 0.80 316.00 regarding case status (.10); prepare for PBGC call (.20); status call with PBGC (.40), schedule committee call (.10). Oct 11, 2010 MAB Office conference with N. Miller 0.70 451.50 (.10) and prepare for Committee call (.10). Also, attend Committee call (.50). Oct 11, 2010 NMM Prepare for committee call (.30); 0.80 316.00 committee call (.50). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.90 645.00 $580.50 N. M. Miller 1.60 395.00 $632.00 TOTAL HOURS 2.50 TOTAL FEES $1,212.50 TOTAL FEES $1,212.50 Statement No: 175505 For professional services rendered with regard to: Re: Automatic Stay/Adequate Protection Oct 11, 2010 NMM Respond to creditor inquires (.20). 0.20 79.00 TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES N. M. Miller 0.20 395.00 $79.00 TOTAL HOURS 0.20 TOTAL FEES $79.00 TOTAL FEES $79.00 Statement No: 175505 For professional services rendered with regard to: Re: Court Hearings Oct 1, 2010 NMM Conference with A. Guon and court 0.20 79.00 regarding status hearing on 10/5 (.20). Oct 5, 2010 NMM Attend hearing (.30). 0.30 118.50 Oct 19, 2010 NMM Attend hearing (.30). 0.30 118.50 Oct 26, 2010 NMM Attend hearing (.40). 0.40 158.00 TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES N. M. Miller 1.20 395.00 $474.00 TOTAL HOURS 1.20 TOTAL FEES $474.00 TOTAL FEES $474.00 Statement No: 175505 For professional services rendered with regard to: Re: Insurance Oct 4, 2010 NMM Conference with A. Elbert regarding 0.20 79.00 insurance and claims preservation issues (.20). Oct 5, 2010 ARE Work on drafting demand letter. 1.50 787.50 Discuss same with N. Miller. Oct 5, 2010 NMM Conference with A. Elbert regarding 0.30 118.50 claim preservation letter (.10); review and comment on same, and coordinate execution and delivery (.20). Oct 6, 2010 ARE E-mails with Nick Miller regarding 0.30 157.50 SK Hand Tool call. Oct 6, 2010 NMM Attention to insurance issues (.20). 0.20 79.00 Oct 7, 2010 ARE Further work on letter and e-mails 0.40 210.00 with N. Miller regarding same. Oct 7, 2010 NMM Conference with A. Elbert regarding 0.30 118.50 insurance issues (.20); coordinate claims letter (.10). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES A.R. Elbert 2.20 525.00 $1,155.00 N. M. Miller 1.00 395.00 $395.00 TOTAL HOURS 3.20 TOTAL FEES $1,550.00 TOTAL FEES $1,550.00 NEAL, GERBER EISENBERG LLP December 6, 2010 Invoice 176236 Statement No: 176236 For professional services rendered with regard to: Re: Case Administration Nov 3, 2010 NTB Conference with N. Miller regarding 0.30 72.00 fee application (.10) conference regarding service parties (.20). Nov 4, 2010 NMM Review and revise motion to convert 2.40 948.00 (1.80); conference with M. Berkoff regarding same (.20); review documents supporting conversion motion (.30); call with UST regarding same (.10). Nov 5, 2010 NMM Review and revise, and coordinate 0.30 118.50 filing of, conversion motion (.30). Nov 5, 2010 KJA Delivered courtesy copies to judge's 0.40 36.00 chambers for N. Miller. Nov 9, 2010 NTB Call to clerk regarding notice (.20); 0.40 96.00 e-mail to M. Berkoff regarding same (.10); revise notice (.10). Nov 10, 2010 NTB Revise notice (.20); e-file amended 0.80 192.00 notice (.20); coordinate service of same (.20); docket review (.10) draft and send docketing request (.10). Nov 16, 2010 NTB Obtain copies of motion to convert 0.20 48.00 for N. Miller and M. Berkoff. Nov 17, 2010 NTB Draft letter to committee enclosing 0.20 48.00 October invoice. Nov 18, 2010 MAB Office conference with N. Miller on 0.10 64.50 status and strategy. Nov 18, 2010 NTB Docket review (.10) draft and send 0.20 48.00 docketing request (.10). Nov 19, 2010 NMM Status memorandum to Committee 0.50 197.50 (.30); call with C. Gulden (UST) regarding conversion motion (.20). Nov 22, 2010 NMM Conferences with C. Gulden and M. 0.20 79.00 Berkoff regarding conversion issues (.20). Nov 24, 2010 MAB Review Webster's response to NGE's 0.30 193.50 fee application (.10); review Debtor's two motions to compromise account receivables (.10); review e-mail from Roseanne Matzat (.10). Nov 24, 2010 NTB Docket review (.10) draft and send 0.20 48.00 docketing request (.10). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.40 645.00 $258.00 N. M. Miller 3.40 395.00 $1,343.00 N. Taylor Brody 2.30 240.00 $552.00 K. J. Augusta 0.40 90.00 $36.00 TOTAL HOURS 6.50 TOTAL FEES $2,189.00 TOTAL FEES $2,189.00 Statement No: 176236 For professional services rendered with regard to: Re: Meetings Nov 22, 2010 MAB Review N. Miller e-mail to 0.20 129.00 Committee discuss same with N. Miller (.10); review monthly operating reports (.10). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.20 645.00 $129.00 TOTAL HOURS 0.20 TOTAL FEES $129.00 TOTAL FEES $129.00 Statement No: 176236 For professional services rendered with regard to: Re: Cash Collateral/DIP Financing/ Other Financing Nov 3, 2010 NMM Conferences with R. Matzat and M. 0.20 79.00 Berkoff regarding financing issues (.20). Nov 8, 2010 NMM Review order regarding DIP 0.20 79.00 financing (.10); conference with M. Berkoff regarding same (.10). Nov 9, 2010 NMM E-mail to R. Matzat regarding DIP 0.10 39.50 financing issues (.10). Nov 10, 2010 NMM Conference with M. Berkoff 0.10 39.50 regarding unsuccessful efforts to discus financing issues with Webster (.10). Nov 11, 2010 MAB Office conference with N. Miller and 0.20 129.00 exchange e-mails regarding carve out (.20). Nov 11, 2010 NMM Conference with A. Guon regarding 0.30 118.50 financing issues (.20); e-mail M. Berkoff regarding same (.10). Nov 12, 2010 NMM Conferences with A. Guon and M. 1.00 395.00 Berkoff regarding carve out issues (.30); review fee statement and pre- bills for post-fee statement period, and calculate budget requested by Webster (.40); conferences with A. Guon regarding same (.30). Nov 14, 2010 NMM Review and revise notice of filing of 0.80 316.00 proposed committee budget (.80). Nov 15, 2010 NMM Review and revise statement 0.90 355.50 regarding budgeted fees and proposed carve out (.90). Statement No: 176236 For professional services rendered with regard to: Re: Court Hearings Nov 8, 2010 MAB Office conference with N. Miller to 0.10 64.50 de-brief on court appearance on Debtor's emergency motion for use of cash collateral. Nov 8, 2010 NMM Prepare for and attend financing 0.70 276.50 hearing (.70). Nov 9, 2010 NMM Conference with M. Berkoff 0.10 39.50 regarding 11/24 hearing (.10). Nov 10, 2010 MAB Review notice and order regarding 0.40 258.00 11/24 hearing (.20), e-mails regarding amended notice of motion (.10); office conference with N. Miller regarding Bank's failure to talk after Judge Wedoffs admonition and e-mail regarding same (.10). Nov 16, 2010 MAB Review and edit proposed statement 2.60 1,677.00 to be filed in connection with financing hearing on 11/17; discuss same and approach with N. Miller (.50); review Webster's response and discuss with N. Miller (.60). Also, prepare for 11/17 Court (1.50). Nov 17, 2010 MAB Attend hearing on Debtor's 0.90 580.50 Emergency Financing Motion (.80); report to N. Miller (.10). Nov 17, 2010 NMM Debrief with M. Berkoff regarding 0.10 39.50 hearing (.10). Nov 23, 2010 MAB Prepare for November 24 court. 0.20 129.00 Nov 24, 2010 MAB Court appearance on Committee's 1.00 645.00 request to take 2004 exam of Webster (.70); follow up telephone Statement No: 176236 For professional services rendered with regard to: Re: Professional Retention/Fee Issues Nov 19, 2010 NMM Review Much Shelist fee application 0.30 118.50 (.10); review Blackman Kallick fee application (.10); conference with M. Berkoff regarding same (.10). Nov 30, 2010 MAB Attend hearing on professionals' fee 0.90 580.50 applications; read Judge Wedoff's order and e-mails regarding same (.90). TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.90 645.00 $580.50 N. M. Miller 0.30 395.00 $118.50 TOTAL HOURS 1.20 TOTAL FEES $699.00 TOTAL FEES $699.00 Statement No: 176236 For professional services rendered with regard to: Re: Fee Application Preparation Nov 1, 2010 NMM Review and revise fee application 2.80 1,106.00 (2.70); review Webster fee statement (.10). Nov 1, 2010 NTB Conference with N. Miller regarding 0.10 24.00 fee application (.10). Nov 2, 2010 NTB Revise fee application (1.0); draft 1.70 408.00 cover sheet and summary sheet (.40); draft order (.30). Nov 5, 2010 MAB Review and edit NGE's First Interim 0.70 451.50 Fee Application and exhibits; discuss same and service/notice issues with N. Miller. TIMEKEEPER SUMMARY TIMEKEEPER HOURS RATE FEES M. A. Berkoff 0.70 645.00 $451.50 N. M. Miller 2.80 395.00 $1,106.00 N. Taylor Brody 1.80 240.00 $432.00 TOTAL HOURS 5.30 TOTAL FEES $1989.50 TOTAL FEES $1,989.50