When an Entire Security Issue Is Directly Sold to Qualified

question 31

Multiple Choice

When an entire security issue is directly sold to qualified institutional investors, such an issue is called a:

• A) Public issue
• B) Private placement
• C) Securitization
• D) Commercial paper

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Definitions:

Secured Party

A lender or creditor who has a security interest in collateral owned by the debtor, which gives them a legal right to the property if the debtor defaults.

Secured Perfected Creditor

Refers to a creditor who has taken the necessary legal steps to secure a right in the borrower’s collateral, ensuring priority over claims made by other creditors.

After-Acquired Property

Property acquired by a debtor after an agreement or court order, which may become subject to claim by creditors.

UCC

The Uniform Commercial Code governs commercial transactions in a way that facilitates the easy flow of commerce through consistent legal rules.