Local Rule LBR 4001-2: Use of Cash Collateral and Obtaining Credit

Rule 4001-2 Use of Cash Collateral and Obtaining Credit

(a) Contents of Motion. A motion for use of cash collateral or for authority to obtain credit, or a stipulation relating to the same, shall be accompanied by a self-contained, proposed form of order and set forth the following:

(1) the total dollar amount of the request;

(2) the specific uses to which the funds will be put;

(3) the debtor's proposed budget for the use of the funds;

(4) the amount of debt owed to any creditor claiming an interest in the collateral;

(5) the value of the collateral that secures the creditor's asserted interest;

(6) any proposal for providing adequate protection; and

(7) carve-outs for United States trustee and professional fees.

(b) Service. A motion for use of cash collateral or for authority to obtain credit, or a stipulation relating to the same, must be served upon the following parties:

(1) all creditors asserting an interest in the cash collateral, and, if known, their attorneys;

(2) any taxing authority having a claim against the debtor;

(3) the debtor's twenty (20) largest unsecured creditors;

(4) any official committee appointed and serving in the case under 11 U.S.C. § 1102;

(5) the United States trustee; and

(6) any party that has requested service of all documents and notices in the case.

(c) Urgent Motion Requirements. If a debtor files an urgent ex parte application for an order allowing the interim use of cash collateral, it must present by affidavit the following information:

(1) the names and addresses of all creditors holding a secured interest in the cash collateral, and, if known, their attorneys;

(2) the efforts made to contact those secured creditors and any appointed committee or if no committee has been appointed, the twenty (20) largest unsecured creditors, regarding the application for the use of cash collateral;

(3) the nature of the emergency that requires an ex parte order;

(4) the total dollar amount requested to be authorized; and

(5) a description of the adequate protection that will be provided to the secured creditors.

(d) Interim Relief. The court may enter an interim order authorizing use of cash collateral or borrowing, or a stipulation relating to same only to the extent necessary to avoid immediate and irreparable harm to the estate pending a final hearing. Any provision of an interim order may be reconsidered at the final hearing. Provisions in an interim order shall not be binding on the court with respect to the provisions of the final order, except that a lender: (a) will be afforded the benefits and protections of the interim order for funds advanced during the term of the interim order, and (b) will not be required to advance funds under a final order which contains provisions contrary to or inconsistent with the interim order.