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Article 9

Careless mistakes in UCC-3 terminations and continuations can lead to costly litigation with secured parties. Learn best practices for filing and recording.

Ordinary asset purchase? Article 9 sale? Bankruptcy acquisition? When buying a distressed business, the type of purchase should be top of mind.

Whether there is change in collateral or a serial number is listed incorrectly, errors in collateral descriptions can lead to expensive disputes.

An assignment for the benefit of creditors (ABC) can be a faster and more cost-effective alternative for a chapter 11 or 7 liquidation. Understand more about this alternative for selling distressed assets effectively.

In this installment we introduce you to the UCC generally, focusing on Article 9 to illustrate its importance in the context of business distress.

What are the legal remedies available under Article 9 of the UCC to a lender whose loan is secured by the personal property of a borrower who is in default? How can these legal remedies can be implemented in practice?

Considerations for Companies in a Cash Crisis A liquidity crisis is a severe financial situation in which a company does not have enough cash or cash-convertible assets, which can lead to defaults and bankruptcy. Managing cash is critical when working to preserve or maintain solvency in order to maximize opportunities for a successful turnaround or corporate restructuring. Near-Death Liquidity Is Like a Melting Ice Cube Insufficient liquidity shrinks the range of options for a financially distressed business. The metaphor of a melting ice cube is often used to illustrate this […]

How Brevity in Financing Statements Can Lead to Insufficient Collateral Descriptions Our fast-paced society, coupled with the tendency for people to use shorthand in communications by emails and Twitter, influences everyone to look for ways to save time and be less verbose. When preparing and filing a UCC-1, however, brevity can be the filer’s enemy. Description of Collateral in Security Agreements Article 9 of the UCC provides that a security agreement must “provide a description of the collateral.” A description of collateral under Article 9 is usually considered adequate if […]

The SBA’s Views, Court Rulings and Options for Your Company You need to restructure your debt and/or deal as soon as possible with assertive creditors. You want to preserve your company, and you would benefit (or already have benefited) from Paycheck Protection Program (PPP) funds as a bridge. What do you do? Can you risk Chapter 11? Are PPP loans for Chapter 11 debtors available? If not, what are your options? The CARES Act – which has led to two rounds of funding thus far – has proven to be […]

Is It Commercially Reasonable Notice, If No One Is Reading? You represent a secured lender. You are to assist your client in its exercise of rights under UCC §9-610 to sell its collateral after it has foreclosed upon the collateral. Or maybe you represent a chapter 11 debtor and are selling its assets under Bankruptcy Code §363. Or perhaps you are a federal equity receiver selling under 28 U.S.C §2001 et seq. Or you are an assignee for the benefit of creditors or state court receiver who is selling a […]

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