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12A-9-504.


12A-9-504.
   
   Secured Party's Right to Dispose of Collateral After Default; Effect
   of Disposition. - (1) A secured party, after default, may sell, lease
   or otherwise dispose of any or all of the collateral in its then
   condition or following any commercially reasonable preparation or
   processing. Any sale of goods is subject to the Article on Sales
   (Article 2). The proceeds of disposition shall be applied, in the
   order following, to:
   
   (a) the reasonable expenses of retaking, holding, preparing for sale
   or lease, selling, leasing and the like and, to the extent provided
   for in the agreement and not prohibited by law, the reasonable
   attorneys' fees and legal expenses incurred by the secured party;
   
   (b) the satisfaction of indebtedness secured by the security interest
   under which the disposition is made;
   
   (c) the satisfaction of indebtedness secured by any subordinate
   security interest in the collateral if written notification of demand
   therefor is received before distribution of the proceeds is completed.
   If requested by the secured party, the holder of a subordinate
   security interest must seasonably furnish reasonable proof of his
   interest, and unless he does so, the secured party need not comply
   with his demand.
   
   (2) If the security interest secures an indebtedness, the secured
   party must account to the debtor for any surplus, and, unless
   otherwise agreed, the debtor is liable for any deficiency. But if the
   underlying transaction was a sale of accounts or chattel paper, the
   debtor is entitled to any surplus or is liable for any deficiency only
   if the security agreement so provides.
   
   (3) Disposition of the collateral may be by public or private
   proceedings and may be made by way of one or more contracts. Sale or
   other disposition may be as a unit or in parcels and at any time and
   place and on any terms but every aspect of the disposition including
   the method, manner, time, place and terms must be commercially
   reasonable. Unless collateral is perishable or threatens to decline
   speedily in value or is of a type customarily sold on a recognized
   market, reasonable notification of the time and place of any public
   sale or reasonable notification of the time after which any private
   sale or other intended disposition is to be made shall be sent by the
   secured party to the debtor if he has not signed after default a
   statement renouncing or modifying his right to notification of sale.
   In the case of consumer goods, no other notification need be sent. In
   other cases, notification shall be sent to any other secured party and
   any holder of a subordinate lien from whom the secured party has
   received, before sending his notification to the debtor or before the
   debtor's renunciation of his rights, written notice of a claim of an
   interest in the collateral. The secured party may buy at any public
   sale and, if the collateral is of a type customarily sold in a
   recognized market or is of a type which is the subject of widely
   distributed standard price quotations, he may buy at private sale.
   
   (4) When collateral is disposed of by a secured party after default,
   the disposition transfers to a purchaser for value all of the debtor's
   rights therein, discharges the security interest under which it is
   made and any security interest or lien subordinate thereto. The
   purchaser takes free of all such rights and interests even though the
   secured party fails to comply with the requirements of this Part or of
   any judicial proceedings:
   
   (a) in the case of a public sale, if the purchaser has no knowledge of
   any defects in the sale and if he does not buy in collusion with the
   secured party, other bidders or the person conducting the sale; or
   
   (b) in any other case, if the purchaser acts in good faith.
   
   (5) A person who is liable to a secured party under a guaranty,
   indorsement, repurchase agreement or the like and who receives a
   transfer of collateral from the secured party or is subrogated to his
   rights has thereafter the rights and duties of the secured party. Such
   a transfer of collateral is not a sale or disposition of the
   collateral under this article.

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