debtor in possession

(redirected from Debtors 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 ?
Brian Swett represents senior secured lenders and other secured creditors, as well as public and private companies, including debtors in possession, sellers, purchasers, shareholders and investors, in all aspects of in-court and out-of-court workout, restructuring and reorganization matters.
The purpose of this meeting is so that the Equity Committee's professionals can respond to questions equity holders may have with respect to the Plan of Reorganization proposed by Mirant Corporation and its affiliated entities, which are debtors and debtors in possession in Chapter 11 bankruptcy cases pending in the United States Bankruptcy Court for the Northern District of Texas, Fort Worth Division (lead case number 03-46590).
The Company does not expect any outside directors to be added to the Board at this time, and, as debtors and debtors in possession, will continue to manage and operate its assets and businesses subject to the supervision and orders of the bankruptcy court.