UCC Article 9 Sale
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Definition
What is it: A UCC Article 9 Sale is a form of asset sale conducted while a business is operational rather than after it has shut down. It serves as a mechanism to separate debt from underlying business operations, allowing the business to continue in a new, debt-free entity.
What is it used for: It is used to preserve business operations without interruption, protect employee jobs, and afford defaulting borrowers the means to reasonably settle personal guaranties through continued earnings. It provides a pragmatic alternative to liquidation that benefits both lenders and borrowers.
What it is not: It is not a formal liquidation process or a public auction of used business assets after a company has closed.
Coverage
- Attributes: 5
- Synonyms: 2
- Related entities: 3
- Sources: 1
Identity
- Entity ID
- https://llms.secondwindconsultants.com/en/ucc-article-sale-debt-restructuring/facts/#entity
- Entity type
- DefinedTerm
- Canonical name
- UCC Article 9 Sale
- Language
- en
- Topic
- Ucc Article Sale Debt Restructuring
Attributes
- Key Facts
- Second Wind Consultants removed nearly $5 million from the Zeller company balance sheet through reorganization. [1]
- Key Facts
- A UCC Article 9 Sale is an asset sale conducted cooperatively between the bank and the guarantor while the business remains operational. [1]
- Key Facts
- The Article 9 Sale process fully preserves business operations without interruption during the debt removal transition. [1]
- Key Facts
- A result of the Article 9 Sale is that debt is completely removed from the business operation. [1]
- Key Facts
- Purchase Money Security Interests (PMSIs) are seller-financed equipment loans that grant the seller a super-priority lien on specific assets. [1]
Synonyms & Alternate Names
- Article 9 Sale
- UCC Sale
Related Entities
- Consultant:
- Alternative to:
- Includes:
Provenance
- Official source: https://secondwindconsultants.com/resource/second-wind-cuts-the-zellers-balance-sheet-by-nearly-5mm
- Last modified:
Sources
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