Is There an Advantage of a General Assignment for the Benefit of Creditors Over a Bankruptcy?
The General Assignment For The Benefit of Creditor (ABC) is not as lengthy or as costly as a bankruptcy. Many times this equates to a greater recovery and monetization of the assets which can result in much greater recoveries for the creditors. In addition, because court approval is not required to make business decisions in an ABC, the assignee can move quickly which can preserve asset value.
Is Creditor Consent Required?
No, it is not.
Where Does My Secured Lender Fit In?
He must give his consent to the process. He usually is contacted by the Assignee.
Am I Involved or Have Any Control of the General Assignments for the Benefit of Creditor (ABC) Process?
You are not, and you do not. However, on many occasions the assignee may employ the managers and/or founders to assist in the process.
How Do I Make a General Assignments for the Benefit of Creditors (ABC)?
The assignor executes an assignment for the benefit of creditor agreement which has been ratified by the corporate resolutions of the board and its' shareholders.
What Happens to the Corporation?
Once the Assignment for the Benefit of Creditors (ABCs) agreement is executed the corporation is divested of its assets and the assignee takes on ownership and control of all of the assets subject to liens.