Prior to confirmation of a plan, several actions may happen in a Chapter 11 bankruptcy case. Continuous functioning of the debtor’s business may lead to the filing of a number of motions. The most frequent motions are for relief from the automatic stay, the use of cash collateral, or to obtain credit.
The initial motion that should be filed in every Chapter 11 case is a request to employ counsel and other professionals for the Debtor in Possession including accountants, brokers, and appraisers.
Motions for relief from stay are common in chapter 11 cases because of the typically lengthy delay between the filing of a Chapter 11 petition and the confirmation of a Chapter 11 plan.
Generally, a Chapter 11 debtor files a motion for the use of cash collateral along with the bankruptcy petition. On receiving motion for use of cash collateral the court authorizes debtors to make appropriate expenditures. A motion for authority to use cash collateral will be accompanied by a proposed form of order.
A motion for authority to obtain credit should be made in accordance with Bankruptcy Code and should be accompanied by a copy of the credit agreement and a proposed form of order.
A debtor may also file motion for approval of an agreement to provide adequate protection or an agreement to modify or terminate the stay.