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"363 sales" [2019] ELECD 2097; in Lubben, Stephen (ed), "American Business Bankruptcy" (Edward Elgar Publishing, 2019) 157

Book Title: American Business Bankruptcy

Editor(s): Lubben, Stephen

Publisher: Edward Elgar Publishing

Section: Chapter 18

Section Title: 363 sales

Number of pages: 6

Abstract/Description:

If the debtor’s assets do not need serious restructuring, but instead the company simply needs to get out from under excessive debt obligations, a quick sale can return the assets to productive use in a short period of time. Section 363(b)(1) provides that the “trustee, after notice and a hearing, may use, sell, or lease, other than in the ordinary course of business, property of the estate.” Some debtors find it easier to sell their assets in the early days of the case, and then turn to negotiating a plan that will distribute the proceeds. In essence this plan becomes a liquidating plan, and an important part of the action occurs at the point of the sale. These sales are referred to as “363 sales,” after section 363 of the Code.