Cash Collateral Motion

Drafts a motion for authority to use cash collateral under § 363(c)(2) — a critical first-day pleading in bankruptcy. Covers adequate protection, budget constraints, carve-outs, and interim/final hearing procedures.

Required Inputs

Case info — debtor name, case number, chapter, court, judge
Prepetition debt — secured creditor(s), loan docs, amounts, collateral descriptions
Cash collateral sources — accounts receivable, bank accounts, inventory proceeds, rents
Budget — 13-week cash flow projection with line-item detail
Adequate protection proposal — what debtor offers the secured creditor
Lien records — UCC filings, mortgages, security agreements, intercreditor agreements
Urgency basis — why interim relief is needed before final hearing

Workflow

1. Introduction and Relief Requested

Identify debtor, case, chapter
State debtor seeks authority under § 363(c)(2) for interim and final relief
Preview adequate protection package

2. Background

Business operations and necessity of cash collateral
Prepetition secured debt (nature, amount, lien position, priority)
Events leading to filing

3. Jurisdiction

Cite: 28 U.S.C. §§ 157, 1334 · 11 U.S.C. §§ 363(c)(2), 363(e) · Bankruptcy Rule 4001(b) · applicable local rules.

4. Cash Collateral Description

All cash and cash equivalents traced to secured creditor's collateral
Bank/deposit accounts, inventory/receivable proceeds, rents and profits (if applicable)

5. Necessity

Debtor cannot operate without cash collateral
Immediate obligations: payroll, vendors, operations
Consequences of denial: shutdown, job losses, asset deterioration
No alternative financing on better terms

6. Proposed Budget

13-week cash flow projection (attach as exhibit)
Categories: payroll, rent, utilities, insurance, critical vendors, professional fees
Variance reporting (typically ±10–15%) and budget modification procedures

7. Adequate Protection Package (§ 363(e))

Select from and tailor to facts:

Replacement liens — same priority on post-petition assets of same kind
Superpriority claims — § 507(b) administrative expense
Cash payments — periodic interest or principal
Equity cushion — if collateral value exceeds debt
Reporting — financials, budget variance, books-and-records access
Insurance — maintained on collateral
Additional — milestones, operating covenants, termination events

8. Interim and Final Orders

Interim (first-day hearing):

Limited period (2–3 weeks), budget compliance, immediate adequate protection, schedule final hearing

Final:

Extended authorization, full adequate protection, termination events/remedies
Carve-out for professional fees (debtor's counsel, committee counsel, UST fees)
Reservation of rights for all parties

9. Carve-Out Provisions

Professional fee carve-out (amount and structure)
UST quarterly fees, clerk fees, committee professionals
Triggers that reduce or eliminate carve-out

Checks

File as emergency/first-day motion requesting interim relief
Comply with Rule 4001(b)(1)(B) — highlight all specified provisions in the motion
Address intercreditor agreement issues and multiple-creditor priority
Budget must be realistic — inflated projections destroy credibility
Adequate protection must be substantive, not perfunctory
Include a supporting declaration from a debtor representative
Proposed order must be filed as a separate document

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