1 2 3 4 5 6 7 8 9 10 11 12

KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 AVENUE OF THE STARS, 39TH FLOOR LOS ANGELES, CALIFORNIA 90067 TELEPHONE: (310) 407-4000

LEE R. BOGDANOFF (State Bar No. 119542) JONATHAN S. SHENSON (State Bar No. 184250) DAVID M. GUESS (State Bar No. 238241) KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 Avenue of the Stars, 39th Floor Los Angeles, CA 90067 Telephone: (310) 407-4000 Facsimile: (310) 407-9090 Proposed Bankruptcy Counsel for Debtors and Debtors In Possession Debtors' Mailing Address 3411 N. Perris Blvd. Perris, CA 92571 National R.V. Holdings, Inc.'s Tax I.D. #XX-XXX-1079 National R.V., Inc.'s Tax I.D. #XX-XXX-5022

UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA RIVERSIDE DIVISION In re NATIONAL R.V. HOLDINGS, INC., a Delaware corporation; NATIONAL R.V., INC., a California corporation, Debtors. Case No.: 6:07-17941-PC Chapter 11 Jointly Administered with Case No.: 6:07-17937-PC SUPPLEMENT TO EMERGENCY MOTION OF DEBTORS AND DEBTORS IN POSSESSION PURSUANT TO LOCAL BANKRUPTCY RULE 2081-1(b) AND (c) FOR ORDER: (1) GRANTING DEBTORS AND DEBTORS IN POSSESSION INTERIM USE OF CASH COLLATERAL; AND (2) SCHEDULING DEADLINES RELATING TO THE NEXT HEARING ON USE OF CASH COLLATERAL Hearing Date: Time: Place: December 20, 2007 10:00 a.m. Courtroom 303 U.S. Bankruptcy Court 3420 Twelfth Street Riverside, CA 92501-3819

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
100684.5

1 2 3 4 5 6 7 8 9 10 11 12
KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 AVENUE OF THE STARS, 39TH FLOOR LOS ANGELES, CALIFORNIA 90067 TELEPHONE: (310) 407-4000

TO THE HONORABLE PETER H. CARROLL, UNITED STATES BANKRUPTCY JUDGE, THE OFFICE OF THE UNITED STATES TRUSTEE, THE DEBTORS' TWENTY LARGEST UNSECURED CREDITORS, THE DEBTORS' SECURED LENDERS AND OTHER PARTIES IN INTEREST: National R.V. Holdings, Inc., a Delaware corporation ("NRVH"), and National R.V., Inc., a California corporation ("NRV", and collectively the "Debtors"), the debtors and debtors in possession in the above-captioned cases, shall and do hereby file this supplement (the "Supplement") to that certain Emergency Motion of Debtors and Debtors in Possession Pursuant to Local Bankruptcy Rule 2081-1(b) and (c) for Order: (1) Granting Debtors and Debtors in Possession Interim Use of Cash Collateral; and (2) Scheduling Deadlines Relating to the Next Hearing on Use of Cash Collateral [Docket #11] (the "Motion"), and, in connection therewith, move this Court pursuant to Local Bankruptcy Rule 2081-1(b) and (c), on an emergency basis, for entry of an order authorizing the Debtors to use cash collateral (on a consensual basis) and granting the other relief contemplated in the proposed form of stipulated-order attached hereto as Exhibit 1 (the "Order") to fund payroll, security services, utility deposits and other essential items from December 20, 2007 to and through January 8, 2008 as provided for in the budget attached hereto as Exhibit 2 (the "Budget"). The Debtors have reached an agreement with Wells Fargo Bank, N.A. ("Wells Fargo") for such continued use of Cash Collateral, and are not aware of any other secured creditors having an interest in such Cash Collateral. The relief sought herein is supported by the

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Declaration of Thomas J. Martini in Support of Supplement to Emergency Motion of Debtors and Debtors in Possession Pursuant to Local Bankruptcy Rule 2081-1(b) and (c) for Order: (1) Granting Debtors and Debtors in Possession Interim Use of Cash Collateral; and (2) Scheduling Deadlines Relating to the Next Hearing on Use of Cash Collateral (the "Martini Declaration"), which the Debtors are filing concurrently herewith.

100684.5

1 2 3 4 5 6 7 8 9 10 11 12
KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 AVENUE OF THE STARS, 39TH FLOOR LOS ANGELES, CALIFORNIA 90067 TELEPHONE: (310) 407-4000

The Debtors have no access to cash other than Cash Collateral1 to satisfy their immediate and outstanding obligations. Access to these funds is a necessary precondition to the success of the efforts to dispose of assets in an orderly fashion. Unless the Court immediately enters the Order, the Debtors will suffer immediate and irreparable harm. As set forth in greater detail in the Motion, in order to dispose of their assets effectively, the Debtors need time and money. The relief requested herein will help to ensure that the Debtors continue to have the capability to aggressively find, negotiate and enter into arrangements that will yield the largest recoveries for the economic stakeholders in the estates. In addition, the Debtors currently are actively exploring other mechanisms to fund operations other than through use of Cash Collateral. The Debtors have filed this Motion in order to ensure that necessary expenses are paid during this process. Bankruptcy Rule 4001(b)(2) specifically allows the Court to conduct a preliminary hearing on a motion for authority to use cash collateral, and the Debtors respectfully submit that such a hearing must be held as quickly as possible. Local Bankruptcy Rule 2081-1(b) and (c) likewise authorize the holding of an emergency hearing on use of cash collateral. Accordingly, pursuant to Bankruptcy Rule 4001(b)(2), the Debtors specifically request that the Court authorize the Debtors to use Cash Collateral and request that the Court schedule the next hearing on this Motion on a date prior to January 8, 2008, at which time the Debtors would seek further authority to use Cash Collateral, either consensually pursuant to stipulated order or otherwise.

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

"Cash Collateral" means cash or cash equivalents, whenever acquired, in which the Debtors' estates and an entity other than the estates have an interest, including the proceeds, products, offspring, rents, or profits of property, including, without limitation, all amounts that had not been applied by Wells Fargo Bank, N.A. ("Wells Fargo") against the prepetition amounts owing by the Debtors to Wells Fargo by the time of the filing of the Debtors' chapter 11 petitions on November 30, 2007 (but not including, at this time, any Restricted Cash, as defined and further described below).

100684.5

1 2 3 4 5 6 7 8 9 10 11 12
KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 AVENUE OF THE STARS, 39TH FLOOR LOS ANGELES, CALIFORNIA 90067 TELEPHONE: (310) 407-4000

WHEREFORE, the Debtors respectfully request that the Court grant this Motion in its entirety and enter the Order: Authorizing the Debtors to use Cash Collateral on an interim basis, pending

the next hearing as specified in the Order; and Scheduling deadlines and noticing requirements in connection with the next

hearing to consider the use of Cash Collateral.

DATED: December 19, 2007

/s/ David M. Guess DAVID M. GUESS, an Attorney with KLEE, TUCHIN, BOGDANOFF & STERN LLP Proposed Bankruptcy Counsel for Debtors and Debtors in Possession

13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
100684.5

KLEE, TUCHIN, BOGDANOFF & STERN LLP 1999 AVENUE OF THE STARS, 39TH FLOOR LOS ANGELES, CALIFORNIA 90067 TELEPHONE: (310) 407-4000

28 9 8 7 6 5 4 3 2 1
EXHIBIT 1 PROPOSED FORM OF ORDER TO BE SUBMITTED AT THE HEARING.

27

26

25

24

23

22

21

20

19

18

17

16

15

14

13

12

11

10

100684.5

National RV
PROJECTED CASH FLOW Cash Collateral though Tuesday, January 8, 2008 ($000)
Week 1 Actual 12/7/07 968 1 2 42 1,010 Week 2 Actual 12/14/07 1,005 35 1,040 Week 3 F'cast 12/21/07 987 160 1,147 659 Week 4 F'cast 12/28/07 659 Week 5 F'cast 1/4/08 519 781 1,300 949 Week 6 F'cast 1/8/08 949 TOTAL Through 1/8/08 968 1,018 1,986

Week Ending
1

Notes

BEGINNING CASH (Funding Acct + Lockbox) RECEIPTS: Cash Collections on Accounts Receivable Deposit 1/2 of sale of Energy Credits AVAILABLE CASH CASH DISBURSEMENTS:

2 3 4

5 6 7 8 9 10 11 12 13

Personnel: Payroll, Payroll Taxes, and Benefit Professional: Kemlite - Trial expenses Operating/Finance: Security Services Utility Deposits Payments to chassis vendors Transportation agreemen All Other Operating Expenses TOTAL CASH DISBURSEMENTS

3 4 5 6 1 7 8

47

64 190 21 40 83 35 55 488

64

75 200

21

21

5 5

6 53

55 140

55 351

20 20

250 390 63 40 83 35 196 1,057

ENDING CASH (Funding Acct + Lockbox)

Notes: 1 - Anticipated funding of Accounts Receivable for units sold pre-petition; 2 encumbered units need to be paid of for $83k. 2 - Sale of Energy Credits for $1.5m - 1/2 rec'd at Court approval; balance at AQMD transfer. 3 - Payroll - employees paid 1 week in arrears - arrearage from final pre-petition week paid pre-petition. Net payroll paid in current week - payroll taxes paid in following week. 4 - Expenses for experts ($260k) and post-petition retainer for O'Melveny ($200k) in Kemlite trial to begin in January 2008. 5 - Security costs $3k per day - $21k per week. 6 - Projected amounts required to fund utility deposits within 20 days of the petition date. 7 - Deposit for continued transportation services (returns units not sold; ships new sold units) 8 - All other operating expenses, except professional fees. Made up of Utilities, business insurance employee fringe, office supplies, travel, and other operating expenses (estimated at $220k per month).

1,005

987

659

519

949

929

929

EXHIBIT 2
CONFIDENTIAL - DRAFT FOR DISCUSSION PURPOSES ONLY