Opinion ID: 2422628
Heading Depth: 2
Heading Rank: 1

Heading: DownEast's Interest in the Deposit Account

Text: [¶ 3] In September 2005, Prospect Capital Corporation (f/k/a Prospect Energy Corporation) entered into a credit agreement through which it loaned funds to Worcester Energy Co., Inc., Worcester Energy Partners, Inc., and Biochips, LLC (collectively, Worcester). To secure the agreement, Worcester granted Prospect an Open-End Mortgage, Assignment of Rents, Security Agreement and Fixture Filing (the Mortgage). Worcester's interest in all . . . `deposit accounts' as defined in the UCC was included in the description of collateral secured by the Mortgage. [3] Prospect took no immediate steps to perfect its security interest by obtaining control of the deposit account held at The First. See 11 M.R.S. §§ 9-1104, 9-1314(1), (2). [4] [¶ 4] By February 2009, Worcester had defaulted on its obligations under the credit agreement. Prospect sent Worcester written notice of default, and later provided notice of sale to Worcester and other relevant parties. On March 11, 2009, the collateral secured by the Mortgage, including the deposit account, was sold at auction. Prospect was the high bidder. On March 24, 2009, Prospect executed a Release Bill of Sale, conveying its interest in the collateral to DownEast, its wholly owned subsidiary. Again, neither Prospect nor DownEast took action to obtain control of the deposit account.