Local Rule 4001-3: Authority to Obtain Credit.

Rule 4001-3. Authority to Obtain Credit.

(a) Motion for authority to obtain credit (regular notice). A motion for authority to obtain credit shall comply with Fed.R.Bankr.P. 4001(c)(1)(B), shall conform to Appendix 4F, and shall include as an attachment a statement of the debtor's projected income and projected expenses for the time during which the credit is to be extended. Unless preliminary authority is sought pursuant to Fed.R.Bankr.P. 4001(c)(2), the motion and a notice of motion shall be served on all creditors and other parties in interest not electronically served. The notice shall conform to Bankr. D.S.D. R. 2002-1(a) and shall set forth a last date (month, day, year) for filing an objection or other response that is 14 days after service of the motion and the notice of motion.

(b) Preliminary hearing. A request for a preliminary hearing on a motion for authority to obtain credit pursuant to Fed.R.Bankr.P. 4001(c)(2) shall be reflected in the title of the motion by the addition of the phrase "and Request for Preliminary Hearing." The motion for authority to obtain credit and request for a preliminary hearing shall conform to Appendix 4G and shall include, in a separate paragraph:

(1) a specific statement of the immediate and irreparable harm the estate will suffer if the debtor is not permitted to obtain credit pending a final hearing on the motion;

(2) the specific amount of credit needed during the preliminary notice period following service of the motion and the notice of motion; and

(3) the source(s) and terms of the credit and an offer of adequate protection, if different than the source(s) or the offer set forth pursuant to Fed.R.Bankr.P. 4001(c)(1)(B) and paragraph (a) above.

If the request for a preliminary hearing is granted, the Court's order will set deadlines for responses and, if necessary, a preliminary hearing. The order will constitute the notice of the motion and shall be served by the movant as directed by the Court in the order.

(c) Agreement regarding authority to obtain credit following a motion for such authority. If the debtor and all parties who timely objected to a properly filed and served motion for authority to obtain credit reach an agreement regarding such relief that does not exceed the scope of the original motion, the agreement, if reduced to writing, shall be signed and filed with the Court, and the parties shall submit pursuant to Bankr. D.S.D. R. 9072-1(a) an agreed proposed order. Upon entry of the agreed order, any previously scheduled hearing on the motion will be deemed moot. If the agreement exceeds the scope of the motion, the agreement shall be noticed for objections in compliance with Bankr. D.S.D. R. 9019-1(b).

(d) Agreement regarding authority to obtain credit when a motion for authority to obtain credit has not been filed. If parties in interest reach an agreement regarding the obtaining of credit before a motion for such relief has been filed, a motion to approve the agreement and a notice of motion shall be served on parties in interest not electronically served. If the agreement has been reduced to writing, a copy of the signed agreement shall be attached to the motion. The notice shall conform to Bankr. D.S.D. R. 2002-1(a) and shall set forth a last date (month, day, year) for filing an objection or other response that is 14 days after service of the motion and the notice of motion.

(e) Proposed order. A proposed order granting preliminary authority to obtain credit shall conform to Appendix 4H. A proposed order granting final authority to obtain credit shall conform to Appendix 4I.

REFERENCES: 11 U.S.C. § 364; Fed.R.Bankr.P. 4001.

Practice Pointer: If any party is served by mail or under the provisions of Fed.R.Civ.P. 5(b)(2)(D) [leave with clerk] or (F) [other means consented to], the notice periods stated above shall be increased three days pursuant to Fed.R.Bankr.P. 9006(f).