Critical Vendor Motions

Chapter 11 debtors often file motions, usually at the outset of a case, that seek to pay prepetition unsecured amounts owed to 'critical' vendors that supply debtors with essential goods and services. Debtors argue that, unless such motions are granted, vendors will cease supplying them, and thus jeopardize their ability to reorganize. Court orders that grant critical vendor motions require vendors to continue supplying debtors on specified business terms in return for payment of the prepetition amounts owed.

17 minute read August 15, 2003 at 02:08 PM
By
Daniel A. Lowenthal III And Peter V. Marchetti
Critical Vendor Motions

Chapter 11 debtors often file motions, usually at the outset of a case, that seek to pay prepetition unsecured amounts owed to 'critical' vendors that supply debtors with essential goods and services.

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