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© Practising Law InstituteREAL ESTATE LAW AND PRACTICE

Course Handbook SeriesNumber N-652

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Commercial Real Estate Financing

2017

Co-ChairsSteven R. Davidson

Joshua Stein Everett S. Ward

© Practising Law Institute

14

UCC Security Interests (PowerPoint slides)

Jonathan M. Cooper

Goldberg Kohn Ltd.

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351


352


Apr

il 6,

201

7

UC

C S

EC

UR

ITY

INTE

RE

STS

Jona

than

M. C

oope

rP

LI -

Com

mer

cial

Rea

l Est

ate

Fina

ncin

g 20

17

353


2

UC

C O

verv

iew

•St

ate

Law

: Th

e U

nifo

rm C

omm

erci

al C

ode

(UC

C) i

s a

serie

s of

reco

mm

ende

d st

atut

es fo

r ado

ptio

n by

the

stat

es d

ealin

g w

ith v

ario

us c

omm

erci

al tr

ansa

ctio

ns.

•S

pons

ored

by

the

Am

eric

an L

aw In

stitu

te (A

LI) a

nd th

e N

atio

nal C

onfe

renc

e of

Com

mis

sion

ers

on U

nifo

rm S

tate

Law

s (N

CC

US

L).

•La

st s

igni

fican

t ove

rhau

l was

in 2

001,

and

mos

t rec

ent

amen

dmen

t rou

nd w

as 2

010.

•“U

nifo

rm A

dopt

ion”

:A

s th

e na

me

sugg

ests

, the

UC

C is

de

sign

ed fo

r uni

form

sta

te a

dopt

ion.

354


Com

pone

nts

of th

e U

CC

The

UC

C c

onsi

sts

of 1

0 pr

imar

y A

rtic

les:

–A

rticl

e 1

(Gen

eral

Pro

visi

ons)

–A

rticl

e 2

(Sal

es)

–A

rticl

e 2A

(Le

ases

)–

Arti

cle

3 (N

egot

iabl

e In

stru

men

ts)

–A

rticl

e 4

(Ban

k D

epos

its a

nd C

olle

ctio

ns)

–A

rticl

e 5

(Let

ters

of C

redi

t)–

Arti

cle

6 (B

ulk

Sal

es)

–A

rticl

e 7

(Doc

umen

ts o

f Titl

e)–

Arti

cle

8 (In

vest

men

t Sec

uriti

es)

–A

rtic

le 9

(S

ecur

ed T

rans

actio

ns)

3

355


Arti

cle

9 O

verv

iew

•A

rtic

le 9

/Loa

n Tr

ansa

ctio

ns: W

hile

por

tions

of o

ther

Arti

cles

of t

he

UC

C a

re a

pplic

able

to lo

an tr

ansa

ctio

ns, t

he p

rimar

y A

rticl

e ap

plic

able

to

loan

tran

sact

ions

is A

rticl

e 9

(Sec

ured

Tra

nsac

tions

)

•B

road

Cov

erag

e of

Per

sona

l Pro

pert

y C

olla

tera

l

•K

ey C

olla

tera

l Exc

lusi

ons

/ Mod

ifica

tions

(9-

109(

c)):

–S

ecur

ity in

tere

sts

in re

al p

rope

rty

–M

atte

rs p

re-e

mpt

ed b

y fe

dera

l law

(for

exa

mpl

e ai

rpla

nes,

ra

ilroa

d ca

rs, c

opyr

ight

s, c

erta

in a

gric

ultu

ral l

iens

(PA

CA

, PA

SA

))–

Inte

rest

s in

insu

ranc

eot

her t

han

(1) i

nsur

ance

that

is p

roce

eds

of

othe

r col

late

ral a

nd (2

) hea

lth c

are

insu

ranc

e re

ceiv

able

s

4

356


Prim

ary

Goa

ls o

f Arti

cle

9

Prov

ide

a sy

stem

for e

ffici

ently

and

effe

ctiv

ely:

•O

btai

ning

lien

s on

per

sona

l pro

perty

•E

nabl

ing

third

par

ties

to s

earc

h pu

blic

reco

rds

for p

rior l

iens

(n

ot p

erfe

ct, s

till “

secr

et li

ens”

)•

Est

ablis

hing

prio

rity

amon

g co

mpe

ting

cred

itors

•A

ddre

ssin

g th

e rig

hts

of th

ird p

artie

s in

col

late

ral

•E

nfor

cing

sec

urity

inte

rest

s

5

357


Com

pone

nts

of A

rticl

e 9

Par

t 1 –

Gen

eral

Pro

visi

ons

Par

t 2 –

Effe

ctiv

enes

s of

Sec

urity

Agr

; Atta

chm

ent o

f

Sec

urity

Inte

rest

; Rig

hts

of P

artie

s to

Sec

urity

Agr

Par

t 3 –

Per

fect

ion

and

Prio

rity

Par

t 4 –

Rig

hts

of T

hird

Par

ties

Par

t 5 –

Filin

g

Par

t 6 –

Def

ault

Par

t 7 –

Tran

sitio

n R

ules

(no

long

er re

leva

nt)

6

358


Obt

aini

ng S

ecur

ity In

tere

sts

unde

r Arti

cle

9 ---

“Atta

chm

ent”

and

“Per

fect

ion”

“Atta

chm

ent”:

Sec

urity

inte

rest

is e

nfor

ceab

le a

gain

st th

e de

btor

“Per

fect

ion”

:Sec

urity

inte

rest

is e

nfor

ceab

le a

gain

st 3

rdpa

rties

(in

clud

ing

bank

rupt

cy tr

uste

e)

7

359


“Atta

chm

ent”

Req

uire

men

ts

•“V

alue

”: C

redi

tor h

as p

rovi

ded

valu

e (lo

w s

tand

ard;

1-

204)

–

E.g

., se

cure

d cr

edito

r has

adv

ance

d a

loan

in re

turn

for s

ecur

ity in

tere

st

•“R

ight

s”:D

ebto

r has

righ

ts in

the

colla

tera

l–

The

colla

tera

l is

owne

d by

the

debt

or o

r the

deb

tor o

ther

wis

e ha

s “ri

ghts

” in

the

colla

tera

l tha

t it c

an c

onve

y (ti

tle im

mat

eria

l; 9-

202)

–N

o re

al e

quiv

alen

t of “

title

insu

ranc

e” fo

r per

sona

l pro

pert

y

•“A

uthe

ntic

ated

” Se

curit

y A

gree

men

t “A

dequ

atel

y D

escr

ibin

g” th

e C

olla

tera

l (o

r pos

sess

ion

or c

ontro

l of c

olla

tera

l)–

Gen

eral

col

late

ral d

escr

iptio

ns s

uch

as “

all a

sset

s” a

re in

suffi

cien

t for

th

is p

urpo

se (

9-10

8(c)

)–

Aut

hent

icat

ion

gene

rally

mea

ns s

ecur

ity a

gree

men

t mus

t be

sign

ed

8

360


“Per

fect

ion”

of S

ecur

ity In

tere

sts

•M

anne

r of P

erfe

ctio

n (D

epen

ds o

n A

sset

Typ

e)–

Filin

g a

UC

C fi

nanc

ing

stat

emen

t–

Pos

sess

ion

–C

ontro

l

•Ex

ampl

es:

–Ta

ngib

le a

sset

s (fi

ling

or p

osse

ssio

n)–

Gen

eral

inta

ngib

les

(filin

g on

ly)

–D

epos

it ac

coun

ts(c

ontro

l onl

y)–

Inve

stm

ent p

rope

rty(fi

ling

or p

osse

ssio

n/co

ntro

l)–

Pro

mis

sory

not

es

(filin

g or

pos

sess

ion)

9

361


Per

fect

ion

by F

iling

UC

C F

inan

cing

Sta

tem

ents

•A

vaila

ble

for M

ost A

sset

Typ

es: S

ecur

ity in

tere

sts

in m

ost

type

s of

per

sona

l pro

perty

may

be

perfe

cted

by

filin

g a

UC

C

finan

cing

sta

tem

ent

–e.

g., a

ccou

nts

rece

ivab

le, i

nven

tory

, equ

ipm

ent a

nd g

ener

al

inta

ngib

les

•“S

earc

habl

e” F

iling

Offi

ce: T

he fi

ling

is m

ade

in a

sea

rcha

ble

data

base

in e

ach

stat

e an

d al

low

s ot

her p

oten

tial c

redi

tors

to

sear

ch fo

r prio

r lie

ns (b

urde

n is

on

the

inco

min

g cr

edito

r to

prot

ect i

tsel

f fro

m p

rior l

iens

)

•N

otic

e Fi

lings

: Unl

ike

reco

rdin

g m

ortg

ages

10

362


UC

C F

inan

cing

Sta

tem

ents

: Whe

re to

File

?

•G

ener

al R

ule

(“R

egis

tere

d O

rgan

izat

ions

”):

File

at t

he S

ecre

tary

of

Sta

te’s

Offi

ce o

f the

“sta

te o

f org

aniz

atio

n” o

f the

deb

tor

•Fo

reig

n D

ebto

rs /

Col

late

ral L

ocat

ed O

utsi

de o

f the

Uni

ted

Stat

es:

–Fi

le in

Dis

trict

of C

olum

bia?

–

Car

eful

re c

onfli

ct is

sues

with

non

-US

law

–P

erfe

ct lo

cally

and

com

ply

with

non

-US

law

s

•Fi

xtur

e Fi

lings

: Fi

le in

the

loca

l rea

l est

ate

reco

rds

for b

est p

rote

ctio

n

11

363


UC

C F

inan

cing

Sta

tem

ents

: Req

uire

d Fi

ling

Con

tent

s

•N

ame

of D

ebto

r: T

o be

effe

ctiv

e, th

e fin

anci

ng s

tate

men

t mus

t sho

w th

e co

rrec

t nam

e of

the

debt

or (a

s sh

own

on it

s ce

rtific

ate

or a

rticl

es o

f or

gani

zatio

n in

the

case

of r

egis

tere

d or

gani

zatio

ns)

–“S

wea

t the

sm

all s

tuff”

---“

No

tole

ranc

e fo

r mis

take

s!!!!

!”

•C

olla

tera

l Des

crip

tion

–G

ener

al “a

ll as

sets

” des

crip

tions

are

ok

for t

his

purp

ose

(but

aga

in,

not f

or s

ecur

ity a

gree

men

ts /

atta

chm

ent)

•N

ame/

Add

ress

of S

ecur

ed P

arty

(Impo

rtant

re p

oten

tial n

otic

es to

se

cure

d cr

edito

r)

12

364


Per

fect

ion

by C

ontro

l

•Pe

rfec

tion

Met

hod

Ava

ilabl

e fo

r: (

9-31

2 an

d 9-

314)

–D

epos

it A

ccou

nts

–E

lect

roni

c C

hatte

l Pap

er–

Inve

stm

ent P

rope

rty–

Lette

r-of

-Cre

dit R

ight

s

13

365


Met

hod

of O

btai

ning

Con

trol (

Dep

ends

on

Ass

et T

ype)

•C

ontr

ol A

gree

men

ts:

–D

epos

it ac

coun

ts (“

DA

CA

s”)

–S

ecur

ities

acc

ount

s–

Lette

r-of

-cre

dit r

ight

s

•Po

sses

sion

(e.g

., de

posi

t acc

ount

s / s

ecur

ities

acc

ount

s

mai

ntai

ned

with

the

secu

red

cred

itor)

•Li

en N

otat

ion

in A

pplic

able

Rec

ords

(e.g

., el

ectro

nic

chat

tel

pape

r)

14

366


Adv

anta

ges

of P

erfe

ctin

g by

Con

trol /

Pos

sess

ion

•En

hanc

ed P

riorit

y: W

hile

filin

g m

ay p

erfe

ct th

e lie

n, p

erfe

ctio

n by

con

trol/p

osse

ssio

n m

ay b

e m

ore

effe

ctiv

e be

caus

e ce

rtain

th

ird p

arty

righ

ts m

ay ta

ke p

riorit

y ov

er p

erfe

ctio

n by

filin

g (e

.g.,

bona

fide

pur

chas

ers

and

secu

red

parti

es p

erfe

ctin

g by

con

trol

or p

osse

ssio

n)

•Pr

actic

al A

dvan

tage

s:

–“C

ash

is K

ing”

: DA

CA

s gi

ve le

nder

the

right

to c

ut-o

ff de

btor

fro

m it

s ca

sh–

“Pos

sess

ion

is 9

/10t

hs o

f the

Law

”

15

367


Prio

rity

of S

ecur

ity In

tere

sts:

Gen

eral

Rul

es

•G

ener

al P

riorit

y: P

erfe

cted

sec

urity

inte

rest

s ge

nera

lly h

ave

prio

rity

over

: –

Uns

ecur

ed c

redi

tors

–

Unp

erfe

cted

sec

urity

inte

rest

s

•“F

irst t

o Fi

le o

r Per

fect

”: P

riorit

y ap

plie

s re

gard

less

of w

hen

the

debt

or’s

obl

igat

ions

are

incu

rred

–P

re-fi

ling

UC

C fi

nanc

ing

stat

emen

ts–

Futu

re a

dvan

ces

16

368


Exa

mpl

e

–O

n Ja

nuar

y 1s

tC

redi

tor A

mak

es a

loan

to d

ebto

r (a

secu

rity

agre

emen

t is

sign

ed g

rant

ing

a se

curit

y in

tere

st in

deb

tor’s

equ

ipm

ent).

–

On

Janu

ary

10th

Cre

dito

r B fi

les

a U

CC

fina

ncin

g st

atem

ent a

gain

st a

ll of

de

btor

’s e

quip

men

t, bu

t has

not

yet

ent

ered

into

a s

ecur

ity a

gree

men

t (C

redi

tor

B is

firs

t to

file,

but

has

not

yet

per

fect

ed it

s se

curit

y in

tere

st).

–O

n Ja

nuar

y 20

thC

redi

tor A

file

s a

finan

cing

sta

tem

ent a

gain

st d

ebto

r’s

equi

pmen

t (C

redi

tor A

is n

ow p

erfe

cted

, and

is fi

rst t

o pe

rfect

).–

On

Janu

ary

30th

Cre

dito

r B m

akes

a lo

an to

deb

tor a

nd d

ebto

r sig

ns a

sec

urity

ag

reem

ent g

rant

ing

a se

curit

y in

tere

st in

all

of it

s eq

uipm

ent (

Cre

dito

r B is

now

pe

rfect

ed, a

nd is

sec

ond

to p

erfe

ct)

Who

has

prio

rity ?

Cre

dito

r B h

as p

riorit

y be

caus

e it

filed

firs

t (ev

en th

ough

it

perf

ecte

d se

cond

). C

redi

tor A

cou

ld h

ave

filed

firs

t, bu

t fai

led

to d

o so

. If

Cre

dito

r B s

earc

hed

the

reco

rds

it w

ould

not

hav

e fo

und

any

evid

ence

of C

redi

tor

A’s

sec

urity

inte

rest

and

is fr

ee to

ass

ume

the

asse

ts a

re fr

ee a

nd c

lear

.

17

369


Prio

rity

Exc

eptio

ns

•Pu

rcha

se M

oney

Sec

urity

Inte

rest

s:

–Eq

uipm

ent :

Whe

n a

loan

is a

dvan

ced

to p

urch

ase

a sp

ecifi

c ite

m o

f eq

uipm

ent (

incl

udin

g se

ller f

inan

cing

), a

purc

hase

mon

ey s

ecur

ity in

tere

st

in s

uch

equi

pmen

t (a

“PM

SI”)

has

prio

rity

over

prio

r per

fect

ed s

ecur

ity

inte

rest

s th

erei

n so

long

as

the

PM

SI i

s pe

rfect

ed n

o la

ter t

han

20 d

ays

afte

r the

deb

tor r

ecei

ves

poss

essi

on o

f the

equ

ipm

ent.

–In

vent

ory:

Sam

e as

for e

quip

men

t, bu

t •

No

20 d

ay g

race

per

iod

(PM

SI m

ust b

e pe

rfect

ed p

rior t

o de

btor

taki

ng

poss

essi

on)

•R

equi

red

Not

ice:

PM

SI c

redi

tor m

ust s

end

a no

tice

to a

ny p

rior

perfe

cted

cre

dito

r of i

ts in

tere

st in

the

inve

ntor

y pr

ior t

o de

btor

’s re

ceip

t of

the

inve

ntor

y->

Not

e: I

mpo

rtan

ce o

f mai

ntai

ning

cor

rect

sec

ured

par

ty n

otic

e in

form

atio

n on

UC

C fi

nanc

ing

stat

emen

ts18

370


Prio

rity

Exc

eptio

ns (C

on’t)

•C

ontr

actu

al S

ubor

dina

tion

•Pe

rfec

tion

by C

ontr

ol /

Poss

essi

on–

Whe

n pe

rfect

ion

is p

ossi

ble

by b

oth

filin

g an

d by

con

trol /

po

sses

sion

, per

fect

ion

by c

ontro

l / p

osse

ssio

n us

ually

win

s (e

.g. i

nstru

men

ts, s

ecur

ities

, let

ter-

of-c

redi

t rig

hts)

-> C

onsi

der p

erfe

ctin

g bo

th w

ays

•Fu

ture

Adv

ance

s / L

ien

Cre

dito

rs /

45 d

ay ru

le->

Impo

rtan

ce o

f per

iodi

c lie

n se

arch

es–

Exc

eptio

n if

adva

nce

is m

ade

purs

uant

to a

pre

-exi

stin

g co

mm

itmen

t19

371


Prio

rity

Exc

eptio

ns (C

on’t)

•Pr

imin

g Li

ens

/ Sec

ret L

iens

, suc

h as

:–

Land

lord

’s li

ens

–W

areh

ouse

man

’s li

ens

–P

roce

ssor

’s li

ens

–P

AC

A /

PA

SA

–B

roke

rs

•Fi

xtur

e Fi

lings

: Fix

ture

filin

gs p

erfe

cted

by

cent

raliz

ed U

CC

-1

finan

cing

sta

tem

ent v

ersu

s pe

rfect

ion

by fi

ling

of "f

ixtu

re fi

ling"

in

real

est

ate

reco

rds

20

372


Pot

entia

l Pitf

alls

•In

corr

ect d

ebto

r nam

e on

UC

C-1

fina

ncin

g st

atem

ent (

smal

l m

ista

ke c

ould

resu

lt in

unp

erfe

cted

loan

)

•IR

S fil

ings

/ IR

S pl

ays

by it

s ow

n ru

les

(deb

tor n

ame;

Spe

arin

g To

ol

case

)

•Fa

ctua

l cha

nges

term

inat

ing

perf

ectio

n–

Deb

tor n

ame

/ loc

atio

n ch

ange

s–

Deb

tor m

erge

r–

Sal

es o

f col

late

ral (

cont

inue

d pe

rfect

ion

in p

roce

eds?

)–

New

ban

k ac

coun

ts, n

ew v

ehic

les,

or o

ther

col

late

ral r

equi

ring

spec

ializ

ed p

erfe

ctio

n st

eps

21

373


Pot

entia

l Pitf

alls

(Con

’t)

•“S

ecre

t lie

ns”,

suc

h as

:–

Land

lord

’s li

ens

–W

areh

ouse

man

’s li

ens

–P

roce

ssor

’s li

ens

–P

AC

A /

PA

SA

–B

roke

rs•

Late

r in

time

“prim

ing

liens

”–

PM

SI (

care

ful o

f inv

ento

ry n

otic

es)

–P

erfe

ctio

n by

pos

sess

ion

(e.g

., st

ock

certi

ficat

es, i

nstru

men

ts)

–P

erfe

ctio

n by

con

trol (

e.g.

, ele

ctro

nic

chat

tel p

aper

, let

ter-

of-c

redi

t rig

hts,

etc

.)

22

374


Pot

entia

l Pitf

alls

(Con

’t)

•“T

ricky

” co

llate

ral,

e.g.

:–

Fore

ign

colla

tera

l–

Com

mer

cial

tort

clai

ms

–S

peci

aliz

ed c

olla

tera

l

•U

CC

term

inat

ion

stat

emen

ts–

Inad

verte

nt te

rmin

atio

n ($

1.5

billi

on s

ecur

ed lo

an to

GM

bec

ame

unse

cure

d)–

Effe

ct o

f una

utho

rized

UC

C te

rmin

atio

n st

atem

ents

•La

pses

in U

CC

fina

ncin

g st

atem

ents

(5 y

ears

)

IMPO

RTA

NC

E O

F LO

AN

FIL

E R

EVIE

W /

UPD

ATE

D S

EAR

CH

ES23

375


Cer

tain

Rig

hts

of S

ecur

ed P

artie

s U

nder

UC

C

•A

ccou

nt D

ebto

r Not

ifica

tion:

–G

ener

al R

ule:

•

Acc

ount

deb

tor r

equi

red

to p

ay s

ecur

ed c

redi

tor d

irect

ly•

Cut

s of

f cer

tain

acc

ount

deb

tor d

efen

ses

–E

xcep

tion:

Gov

ernm

ent r

ecei

vabl

es

•Se

curit

y In

tere

st S

urvi

ves

Col

late

ral S

ales

/Dis

posi

tions

: –

Gen

eral

Rul

e: A

bsen

t sec

ured

cre

dito

r con

sent

, ass

ets

subj

ect t

o a

secu

rity

inte

rest

can

not b

e so

ld fr

ee o

f a p

erfe

cted

lien

–E

xcep

tions

:•

Inve

ntor

y so

ld in

the

ordi

nary

cou

rse

of b

usin

ess

•C

erta

in ty

pes

of a

sset

s (e

.g.,

secu

ritie

s, c

hatte

l pap

er, i

nstru

men

ts)

sold

to a

goo

d fa

ith p

urch

aser

una

war

e of

the

secu

rity

inte

rest

24

376


Cer

tain

Rig

hts

of S

ecur

ed P

artie

s U

nder

UC

C (C

on’t)

•A

nti-A

ssig

nmen

t Cla

uses

Inva

lidat

ed:

Sec

urity

inte

rest

s in

ac

coun

ts re

ceiv

able

, con

tract

s an

d lic

ense

s ar

e ef

fect

ive

even

if

the

gove

rnin

g ag

reem

ents

pro

hibi

t the

ass

ignm

ent o

r gra

ntin

g of

sec

urity

inte

rest

s in

the

right

s un

der t

he a

gree

men

t

–W

ith re

spec

t to

licen

ses

and

cont

ract

s, if

ass

ignm

ent i

s pr

ohib

ited,

the

secu

rity

inte

rest

is li

mite

d to

the

proc

eeds

of

the

licen

se o

r con

tract

(can

not g

et th

e ot

her b

enef

its o

f the

ag

reem

ent)

25

377


UC

C E

nfor

cem

ent

•En

forc

emen

t Opt

ions

: Fo

llow

ing

a de

faul

t by

the

debt

or a

se

cure

d pa

rty m

ay e

nfor

ce it

s rig

hts

in th

e co

llate

ral i

n a

varie

ty

of w

ays,

suc

h as

:–

Not

ify a

ccou

nt d

ebto

rs to

mak

e pa

ymen

t to

secu

red

party

(a

nd e

nfor

ce p

aym

ent o

f acc

ount

s)–

Take

cas

h in

dep

osit

acco

unts

sub

ject

to c

ontro

l–

Rec

eive

pro

ceed

s of

dis

posi

tions

of c

olla

tera

l–

Fore

clos

e by

mea

ns o

f a p

ublic

or p

rivat

e sa

le–

Take

the

colla

tera

l in

full

or p

artia

l sat

isfa

ctio

n of

the

debt

26

378


UC

C S

ales

•Pu

blic

and

Priv

ate

Sale

s–

Not

ice

mus

t be

sent

to th

e de

btor

, oth

er o

blig

ors

and

any

othe

r cr

edito

rs h

avin

g a

perfe

cted

sec

urity

inte

rest

in th

e as

sets

bei

ng

sold

(im

port

ance

of s

ecur

ed p

arty

not

ice

info

rmat

ion)

–N

on-J

udic

ial E

nfor

cem

ent

(but

deb

tor m

ay fi

le b

ankr

uptc

y)

–C

redi

t Bid

: The

sec

ured

cre

dito

r may

pur

chas

e th

e as

sets

in a

pu

blic

sal

e, b

ut n

ot a

t a p

rivat

e sa

le (u

nles

s it

is a

n as

set t

hat i

s cu

stom

arily

sol

d on

a re

cogn

ized

mar

ket o

r sub

ject

to w

idel

y di

strib

uted

sta

ndar

d pr

ice

quot

es)

–“C

omm

erci

ally

Rea

sona

ble”

Sta

ndar

d

27

379


“Con

sens

ual”

Turn

over

•W

ith th

e co

nsen

t of t

he d

ebto

r, th

e se

cure

d cr

edito

r may

acc

ept

the

colla

tera

l in

full

or p

artia

l sat

isfa

ctio

n of

the

oblig

atio

n–

If th

e co

llate

ral w

ill sa

tisfy

less

than

all

of th

e ob

ligat

ions

, the

de

btor

and

sec

ured

cre

dito

r mus

t agr

ee o

n ho

w m

uch

defic

ienc

y w

ill re

mai

n–

Not

ice

mus

t be

give

n to

oth

er s

ecur

ed c

redi

tors

of t

he

prop

osed

tran

sact

ion

(and

they

mus

t not

obj

ect w

ithin

20

days

of r

ecei

pt o

f suc

h no

tice)

28

380


NOTES

381


NOTES

382

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