A senior secured creditor’s right to credit bid in a typical Section 363 sale empowers the creditor to protect itself against any perceived undervaluation of its collateral, whether by the market or otherwise, by being able to bid up to the full amount of the creditor’s debt for the collateral, even where the fair market value of the collateral is less than the amount of such debt, if the Section 363 sale process does not produce a sale price from a third party bidder that is otherwise acceptable to the creditor. Yet, what if a bankruptcy sale is not to be conducted as a stand-alone Section 363 sale, but pursuant to a Chapter 11 plan of reorganization?

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