Local Rule 4001-4: CASH COLLATERAL

RULE 4001-4. CASH COLLATERAL.

(a) Motion for Use of Cash Collateral. In addition to complying with Bankruptcy Rule 4001(b), a motion for use of cash collateral must:

(1) identify the amount and source of cash collateral to be used along with a narrative and budget explaining the intended use of such funds;

(2) summarize all appraisals and projections used to compute the amount of adequate protection; and

(3) specifically highlight in bold typeface and provide justification for any of the following types of provisions contained in an agreement or proposed order authorizing the use of cash collateral:

(A) Any acknowledgement of the validity, amount, perfection, priority, extent or enforceability of the secured claim, if the agreement or order purports to bind any party other than the debtor, unless the agreement or order affords an objection period of not less than 60 days after the earlier of (i) the court's approval of the retention of counsel to any creditor's committee, or (ii) an order authorizing the appointment of a trustee, during which period any committee or trustee may challenge the secured claim on any basis;

(B) Any release of claims or waiver of defenses by the debtor, any estate representative, or third party;

(C) Any cross-collateralization, conversion of pre-petition debt to post-petition debt, or granting of a post-petition lien to secure a claim for pre-petition claims;

(D) Any provision that results in the priming of a perfected pre-petition secured debt without the consent of the affected creditor;

(E) Any grant of a security interest in avoidance actions or their proceeds;

(F) Any provision granting a creditor relief from the automatic stay without further order or hearing upon the breach such agreement;

(G) Any provision that immediately waives the debtor's or a trustee's right to surcharge collateral under Code section 506(c);

(H) Any provision that limits the Court's power to consider the equities of the case doctrine under Code section 552(b) or otherwise limits the Court's discretion to enter future orders in the case.

(b) Interim Hearing on Use of Cash Collateral. Any motion for interim use of cash collateral must not seek any of the relief described in subsection (a)(3) prior to a final hearing and must set forth facts demonstrating the debtor is at risk of immediate and irreparable harm, and (2) a detailed itemization of the amount of cash the debtor requests and how the debtor proposes to use it during the interim period. The debtor must serve all secured creditors who have an interest in the collateral with notice of the interim hearing in the manner the Court directs. See also Local Rule 9075-1 (providing instructions for handling emergency matters).

(c) Final Hearing on Use of Cash Collateral. In addition to the noticing requirements under the Code and the Bankruptcy Rules, the debtor must serve notice of the final hearing on all parties on the master mailing list and any other party who claims an interest in the cash collateral.