The failure of reclamation, which pinches Section 503(b)(9) between the Code's dueling interests in ensuring trade creditors get paid and ensuring that debtors can successfully exit Chapter 11, is ultimately tied to the advent of widespread reliance on secured credit and blanket liens
among even small debtors.
necessary to analyze blanket liens using a modified version of the
If blanket liens were prohibited, debtors could still
particular when it takes the form of a blanket lien on a debtor's
Banks like to be very secure when lending by taking blanket liens
on all assets.
By focusing on financing fixed assets, the San Francisco-based investment firm can complement any existing debt or equity capital structure and do so without requiring equity enhancements or blanket liens
Parties that perform work on multiple properties (as is often the case with subdivision or utility work) should be aware, however, that the Act authorizes blanket liens
for work performed on multiple properties pursuant to a single contract.
Lenders who previously accepted blanket liens
on corporate assets are now obtaining liens on each individual item of rolling stock due to concerns that the current economic climate may potentially lead to borrower defaults.
However, as the recent case from the Virginia Supreme Court demonstrates, the right to use blanket liens is subject to significant limitations.
Blanket liens continue to be an essential tool for use by suppliers to secure payment.
Warning: The California Department of Real Estate has not examined this offering, including, but not limited to, the condition of title, the status of blanket liens
on the project (if any), arrangements to assure project completion, escrow practices, control over project management, racially discriminatory practices (if any), terms, conditions, and price of the offer, control over annual assessments (if any), or the availability of water, services, utilities, or improvements.
The loans are secured by blanket liens
on the accounts receivable and inventory of most subsidiaries, and most subsidiaries guarantee Magellan's borrowings under the facility.