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0 tracked cards Supplemental - Not MEE July 2026

A security agreement states that default occurs if the debtor sells equipment outside the ordinary course or moves collateral out of state without consent. The debtor sells a machine to a scrap buyer and moves two forklifts to another state without consent.
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An unauthorized sale or relocation of collateral can be a default if the security agreement makes it one. A sale of collateral is default only if the sale price is below market value. Unauthorized collateral sales matter only to tax law. A debtor has an absolute Article 9 right to sell any collateral free of all loan covenants.

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