debtor in possession

(redirected from Debtor-in-Possession)
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Debtor in possession

A firm that continues to operate under the Chapter 11 bankruptcy process.

Debtor in Possession

A company that maintains its operations during a Chapter 11 bankruptcy. A debtor in possession is generally attempting to fulfill its reorganization plan, discharging certain debts and changing any structural weaknesses to put it on a path to profitability. As such, a debtor in possession is drastically different from a company in liquidation, which ceases operations and sells all its assets.

debtor in possession

A company that continues to operate while in Chapter 11 bankruptcy.

debtor in possession (DIP)

(To pronounce the abbreviation always say each letter; it is not pronounced as a word.) In bankruptcy,a Chapter 11 debtor who remains in possession of his or her property and continues to operate a business or sell the property. The DIP must still obtain court approval for nonroutine transactions but is able to conduct business, receive monies, and pay bills, including a reasonable salary for the debtor. Contrast with the situation in which a bankruptcy trustee is appointed;in this case the trustee is then in control of all assets of the debtor.

References in periodicals archive ?
There could be no windfall to a preference recipient where the payment received in reduction of the new value was itself an avoidable preference that had to be repaid to the trustee or debtor-in-possession.
The interim DIP approved as part of the first day motions represents the first portion of the fully-committed, USD950m debtor-in-possession credit facility that it obtained from Citigroup to enhance liquidity and working capital.
* This Plan is usually developed by the debtor-in-possession in conjunction with its pre-petition secured and unsecured creditors, and in consultation with the official unsecured creditors' committee.
GE Capital, Restructuring Finance has provided a USD505m debtor-in-possession (DIP) credit facility to Borders Group Inc, a specialty book retailer.
The prospect of having to disgorge their hard gotten gains to a bankruptcy trustee or debtor-in-possession, after having written off their substantial claims against the debtor, is, to put it bluntly, ONE HECK OF A BUMMER!
NewCare has obtained debtor-in-possession financing, which Lenox believes is sufficient to meet NewCare's payroll and vendor obligations.
29, 1997, will receive debtor-in-possession financing from its existing working capital lender, Congress Financial Corp., on the same terms as its current revolving credit facility.
United Airlines has received approval from a federal bankruptcy judge for boosting its debtor-in-possession financing and to extend the maturity date of the loan to 30 December with an option to extend it to 31 March 2006.
In order to protect a pre-petition settlement agreement from a post-petition preferential attack, the parties to the settlement agreement may structure the agreement in such a way as would make it substantially difficult if not impossible, for a trustee or debtor-in-possession to recover the prepetition transfer of property.
Rich's Department Stores Inc., a 26-unit discounter based in Salem, Mass., and reorganizing under Chapter 11, has received bankruptcy court approval of its entire $30 million debtor-in-possession financing facility with Gordon Brothers Finance Corp.
The money would be separate from any exit financing and would come in the form of an increase to UAL's existing debtor-in-possession loans, reported The Associated Press.
Contemporaneously with the commencement of the case, the debtor (the entity filing the voluntary petition) becomes a debtor-in-possession. The filing of a bankruptcy petition creates a bankruptcy estate which includes all legal and equitable interests of the debtor in property as of the commencement of the case.