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Article: Secured party sale can aid businesses.
- Article from:
- Crain's Cleveland Business
- Article date:
- February 26, 2001
- Author:
CopyrightCOPYRIGHT 2001 Crain Communications, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Thinking about investing in, buying or even selling a distressed business -- one that seems to be beyond a turnaround? Then you'll want to consider a secured party sale. Allowed in most states, secured party sales enable a lender to resell the assets of a corporation to satisfy its secured debt, while all unsecured debt remains attached to whatever remains of the corporation. That's usually nothing. Meanwhile, you can put the assets back in productive use, free of encumbrances. The transaction is meant to provide an out-of-court remedy for companies that otherwise would file for bankruptcy. Changes to the Uniform Commercial Code section governing secured party sales go ...