Payments Outside the Ordinary Course of Business

Payments Outside the Ordinary Course of Business refer to transactions made by a company during bankruptcy proceedings that are not part of its regular operations. For example, if a company typically sells products but suddenly pays a large sum to settle a personal loan, that would be outside its ordinary course. Such payments may need court approval to ensure fairness to creditors and to comply with bankruptcy laws, as they can affect the assets available to repay debts. Overall, these payments are scrutinized to prevent favoritism among creditors during the bankruptcy process.