Bobby Guy is a deal lawyer at Frost Brown Todd
LLC in Nashville, Tennessee, specializing in rescue
investing in the healthcare and real estate industries.
He is also a manager of FBT Financial Indices, LLC,
which produces the FBT/TrBK Distress Indices. He
can be reached at 615-251-5557 or firstname.lastname@example.org.
SAVE THE DATE
Power & Light, 202 B.R. 680 (Bankr. E.D.N. Y.
1996) (adequate protection where priming lien
would enable debtor to commence operations
and increase the value of its assets to going
concern value); In re 495 Cent. Park Ave. Corp.,
136 B.R. 626 (Bankr S.D.N. Y. 1992) (adequate
protection where property value would increase
as a result of renovations being funded by
priming lien); In re Yellowstone Mountain Club,
LLC., No. 08-61570, 2008 WL 5875547 (Bankr.
D. Mont. Dec. 17, 2008) (adequate protection
where proposed financing would continue
debtor’s business as going concern, preserving
and enhancing value, compared to going dark).
5 Union Sav. Bank v. Augie/Restivo Baking
Co. (In re Augie/Restivo Baking Co.), 860
F.2d 515, 517 (2d Cir. 1988); Gen. Elec. Capital
Corp. v. Nigro (In re Appliance Store, Inc.),
181 B.R. 237, 243 (Bankr. W.D. Pa. 1995); In re
FCX, Inc., 54 B.R. 833, 842 (Bankr. E.D.N.C.
1985). See generally G. Ray Warner, “Selected
DIP Loan Issues: Hot Topics,” Am. Bankr.
Inst. Winter Leadership Conf. (Dec. 2002).
6 See Goldstein, “Debtor in Possession
Financing” at 126. See also Specialty
Packaging Holdings, Inc., et al., Chapter
11 Case No. 10-10142 (Bankr. D. Del.).
7 See, e.g., Del. Bankr. L.R. 4001-2(a)(i)
(E); S.D.N. Y. Bankr. L.R. 4001-2(a)( 7).
8 See, e.g., In re Vanguard Diversified, Inc., 31
B.R. 364 (Bankr. E.D.N. Y. 1983)(setting out
five-part test to determine permissibility of
cross-collateralization). Compare Shapiro v.
Saybrook Mfg. Co. (In re Saybrook Mfg. Co.),
963 F.2d 1490, 1496 (11th Cir. 1992)(per se
impermissible); In re Monach Circuit Indus.,
Inc., 41 B.R. 859, 862 (Bankr. E.D. Pa. 1984)
(same) with Clyde Bergemann, Inc. v. Babcock
& Wilcox Co. (In re Babcock & Wilcox Co.),
250 F.3d 955 (5th Cir. 2001) (allowing cross-
collateralization); In re Roblin Indus., Inc., 52
B.R. 241, 244 (Bankr. W.D.N. Y. 1985)(allowing
if proper notice); In re Gen. Oil Distribs., Inc.,
20 B.R. 873, 876 (Bankr. E.D.N. Y. 1982)(same);
McCain Foods, Inc. v. Flagstaff Foodservice Co.
New England, Inc. (In re Flagstaff Foodservice
Corp.), 14 B.R. 462, 468–69 (Bankr. S.D.N. Y.
1981)(same); Borne Chem. Co. v. Lincoln First
Commercial Corp. (In re Borne Chem. Co.),
9 B.R. 263, 269 (Bankr. D.N.J. 1981)(same).
9 See, e.g, Letter from Hon. Peter J. Walsh,
U.S. Bankr. Judge for the Dist. Of Delaware,
to Delaware Bankr. Counsel, “First Day
DIP Financing Orders” (April 2, 1998);
Bruce H. White and William L. Medford,
“Debtor Financing and Liens on Avoidance
Actions,” ABI Journal at 18 (March 2004).
10 Goldstein, “Debtor in Possession
Financing” at 118-121; Jacqueline Palank,
“Bankruptcy Milestones Put Companies
on Short Leash,” Dow Jones Daily
Bankruptcy Review (Jan. 7, 2013).