US Laws, Codes, Statutes & Cases

OKLAHOMA STATUTES

TITLE 12A.

COMMERCIAL CODE

_________

§12A-1-9-101.  Short title.

SHORT TITLE

This article, Sections 1 through 144 of this act, may be cited as Uniform Commercial Code - Secured Transactions.

Added by Laws 2000, c. 371, § 1, eff. July 1, 2001.

§12A-1-9-102.  Definitions and index of definitions.

DEFINITIONS AND INDEX OF DEFINITIONS

(a)  In this article:

(1)  "Accession" means goods that are physically united with other goods in such a manner that the identity of the original goods is not lost.

(2) (A) "Account", except as used in "account for", means a right to payment of a monetary obligation, whether or not earned by performance:

(i) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of;

(ii) for services rendered or to be rendered;

(iii) for a policy of insurance issued or to be issued;

(iv) for a secondary obligation incurred or to be incurred;

(v) for energy provided or to be provided;

(vi) for the use or hire of a vessel under a charter or other contract;

(vii) arising out of the use of a credit or charge card or information contained on or for use with the card; or

(viii) as winnings in a lottery or other game of chance operated or sponsored by a state, governmental unit of a state, or a person licensed or authorized to operate the game by a state or governmental unit of a state.

(B) The term includes health-care-insurance receivables.

(C) The term does not include:

(i) rights to payment evidenced by chattel paper or an instrument;

(ii) commercial tort claims;

(iii) deposit accounts;

(iv) investment property;

(v) letter-of-credit rights or letters of credit; or

(vi) rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card.

(3)  "Account debtor" means a person obligated on an account, chattel paper, or general intangible.  The term does not include persons obligated to pay a negotiable instrument, even if the instrument constitutes part of chattel paper.

(4)  "Accounting", except as used in "accounting for", means a record:

(A) authenticated by a secured party;

(B) indicating the aggregate unpaid secured obligations as of a date not more than thirty-five (35) days earlier or thirty-five (35) days later than the date of the record; and

(C) identifying the components of the obligations in reasonable detail.

(5)  "Agricultural lien" means an interest in farm products:

(A) which secures payment or performance of an obligation for:

(i) goods or services furnished in connection with a debtor's farming operation; or

(ii) rent on real property leased by a debtor in connection with its farming operation;

(B) which is created by statute in favor of a person that:

(i) in the ordinary course of its business furnished goods or services to a debtor in connection with a debtor's farming operation; or

(ii) leased real property to a debtor in connection with the debtor's farming operation; and

(C) whose effectiveness does not depend on the person's possession of the personal property.

(6)  "As-extracted collateral" means:

(A) oil, gas, or other minerals that are subject to a security interest that:

(i) is created by a debtor having an interest in the minerals before extraction; and

(ii) attaches to the minerals as extracted; or

(B) accounts arising out of the sale at the wellhead or minehead of oil, gas, or other minerals in which the debtor had an interest before extraction.

(7)  "Authenticate" means:

(A) to sign; or

(B) to execute or otherwise adopt a symbol, or encrypt or similarly process a record in whole or in part, with the present intent of the authenticating person to identify the person and adopt or accept a record.

(8)  "Bank" means an organization that is engaged in the business of banking.  The term includes savings banks, savings and loan associations, credit unions, and trust companies.

(9)  "Cash proceeds" means proceeds that are money, checks, deposit accounts, or the like.

(10)  "Certificate of title" means a certificate of title with respect to which a statute provides for the security interest in question to be indicated on the certificate as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the collateral.

(11)  "Chattel paper" means a record or records that evidence both a monetary obligation and a security interest in specific goods, a security interest in specific goods and software used in the goods, a security interest in specific goods and license of software used in the goods, a lease of specific goods, or a lease of specific goods and license of software used in the goods.  In this paragraph, "monetary obligation" means a monetary obligation secured by the goods or owed under a lease of goods and includes a monetary obligation with respect to software used in the goods.  The term does not include charters or other contracts involving the use or hire of a vessel.  If a transaction is evidenced by records that include an instrument or series of instruments, the group of records taken together constitutes chattel paper.

(12)  "Collateral" means the property subject to a security interest or agricultural lien.  The term includes:

(A) proceeds to which a security interest attaches;

(B) accounts, chattel paper, payment intangibles, and promissory notes that have been sold; and

(C) goods that are the subject of a consignment.

(13)  "Commercial tort claim" means a claim arising in tort with respect to which:

(A) the claimant is an organization; or

(B) the claimant is an individual and the claim:

(i) arose in the course of the claimant's business or profession; and

(ii) does not include damages arising out of personal injury to or the death of an individual.

(14)  "Commodity account" means an account maintained by a commodity intermediary in which a commodity contract is carried for a commodity customer.

(15)  "Commodity contract" means a commodity futures contract, an option on a commodity futures contract, a commodity option, or another contract if the contract or option is:

(A) traded on or subject to the rules of a board of trade that has been designated as a contract market for such a contract pursuant to federal commodities laws; or

(B) traded on a foreign commodity board of trade, exchange, or market, and is carried on the books of a commodity intermediary for a commodity customer.

(16)  "Commodity customer" means a person for which a commodity intermediary carries a commodity contract on its books.

(17)  "Commodity intermediary" means a person that:

(A) is registered as a futures commission merchant under federal commodities law; or

(B) in the ordinary course of its business provides clearance or settlement services for a board of trade that has been designated as a contract market pursuant to federal commodities law.

(18)  "Communicate" means:

(A) to send a written or other tangible record;

(B) to transmit a record by any means agreed upon by the persons sending and receiving the record; or

(C) in the case of transmission of a record to or by a filing office, to transmit a record by any means prescribed by filing-office rule.

(19)  "Consignee" means a merchant to which goods are delivered in a consignment.

(20)  "Consignment" means a transaction, regardless of its form, in which a person delivers goods to a merchant for the purpose of sale and:

(A) the merchant:

(i) deals in goods of that kind under a name other than the name of the person making delivery;

(ii) is not an auctioneer; and

(iii) is not generally known by its creditors to be substantially engaged in selling the goods of others;

(B) with respect to each delivery, the aggregate value of the goods is One Thousand Dollars ($1,000.00) or more at the time of delivery;

(C) the goods are not consumer goods immediately before delivery; and

(D) the transaction does not create a security interest that secures an obligation.

(21)  "Consignor" means a person that delivers goods to a consignee in a consignment.

(22)  "Consumer debtor" means a debtor in a consumer transaction.

(23)  "Consumer goods" means goods that are used or bought for use primarily for personal, family, or household purposes.

(24)  "Consumer-goods transaction" means a consumer transaction in which:

(A) an individual incurs an obligation primarily for personal, family, or household purposes; and

(B) a security interest in consumer goods secures the obligation.

(25)  "Consumer obligor" means an obligor who is an individual and who incurred the obligation as part of a transaction entered into primarily for personal, family, or household purposes.

(26)  "Consumer transaction" means a transaction in which (i) an individual incurs an obligation primarily for personal, family, or household purposes, (ii) a security interest secures the obligation, and (iii) the collateral is held or acquired primarily for personal, family, or household purposes.  The term includes consumer-goods transactions.

(27)  "Continuation statement" means an amendment of a financing statement which:

(A) identifies, by its file number, the initial financing statement to which it relates; and

(B) indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified financing statement.

(28)  "Debtor" means:

(A) a person having an interest, other than a security interest or other lien, in the collateral, whether or not the person is an obligor;

(B) a seller of accounts, chattel paper, payment intangibles, or promissory notes; or

(C) a consignee.

(29)  "Deposit account" means a demand, time, savings, passbook, or similar account maintained with a bank as defined in paragraph (8) of this subsection.  The term does not include investment property or a deposit account evidenced by an instrument.

(30)  "Document" means a document of title or a receipt of the type described in subsection (b) of Section 7201 of this title.

(31)  "Electronic chattel paper" means chattel paper evidenced by a record or records consisting of information stored in an electronic medium.

(32)  "Encumbrance" means a right, other than an ownership interest, in real property.  The term includes mortgages and other liens on real property.

(33)  "Equipment" means goods other than inventory, farm products, or consumer goods.

(34)  "Farm products" means goods, other than standing timber, with respect to which the debtor is engaged in a farming operation and which are:

(A) crops grown, growing, or to be grown, including:

(i) crops produced on trees, vines, and bushes; and

(ii) aquatic goods produced in aquacultural operations;

(B) livestock, born or unborn, including aquatic goods produced in aquacultural operations;

(C) supplies used or produced in a farming operation; or

(D) products of crops or livestock in their unmanufactured states.

(35)  "Farming operation" means raising, cultivating, propagating, fattening, grazing, or any other farming, livestock, or aquacultural operation.

(36)  "File number" means the number assigned to an initial financing statement pursuant to subsection (a) of Section 19519 of this title.

(37)  "Filing office" means an office designated in Section 19501 as the place to file a financing statement.

(38)  "Filing-office rule" means a rule adopted pursuant to Section 19526 and 19526.1 of this title.

(39)  "Financing statement" means a record or records composed of an initial financing statement and any filed record relating to the initial financing statement.

(40)  "Fixture filing" means the filing of a financing statement covering goods that are or are to become fixtures and satisfying subsections (a) and (b) of Section 19502 of this title.  The term includes the filing of a financing statement covering goods of a transmitting utility which are or are to become fixtures.

(41)  "Fixtures" means goods that have become so related to particular real property that an interest in them arises under real property law.

(42)  "General intangible" means any personal property, including things in action, other than accounts, chattel paper, commercial tort claims, deposit accounts, documents, goods, instruments, investment property, letter-of-credit rights, letters of credit, money, and oil, gas, or other minerals before extraction.  The term includes payment intangibles and software.

(43)  "Good faith" means honesty in fact and the observance of reasonable commercial standards of fair dealing.

(44) (A) "Goods" means all things that are movable when a security interest attaches.

(B) The term includes:

(i) fixtures;

(ii) standing timber that is to be cut and removed under a conveyance or contract for sale;

(iii) the unborn young of animals;

(iv) crops grown, growing, or to be grown, even if the crops are produced on trees, vines, or bushes; and

(v) manufactured homes.

(C) The term also includes a computer program embedded in goods and any supporting information provided in connection with a transaction relating to the program if:

(i) the program is associated with the goods in such a manner that it customarily is considered part of the goods; or

(ii) by becoming the owner of the goods, a person acquires a right to use the program in connection with the goods.

(D) The term does not include a computer program which is embedded in goods and that consist solely of the medium in which the program is embedded.

(E) The term also does not include accounts, chattel paper, commercial tort claims, deposit accounts, documents, general intangibles, instruments, investment property, letter-of-credit rights, letters of credit, money, or oil, gas, or other minerals before extraction.

(45)  "Governmental unit" means a subdivision, agency, department, county, parish, municipality, or other unit of the government of the United States, a state, or a foreign country.  The term includes an organization having a separate corporate existence if the organization is eligible to issue debt on which interest is exempt from income taxation under the laws of the United States.

(46)  "Health-care-insurance receivable" means an interest in or claim under a policy of insurance which is a right to payment of a monetary obligation for health-care goods or services provided or to be provided.

(47) (A) "Instrument" means a negotiable instrument or any other writing that evidences a right to the payment of a monetary obligation, is not itself a security agreement or lease, and is of a type that in ordinary course of business is transferred by delivery with any necessary endorsement or assignment.

(B) "Instrument" includes:

(i) an instrument as defined in subparagraph (A) of this paragraph, whether the instrument is subject to Section 3-104 of this title because it is not payable to order; and

(ii) a writing that contains both an acknowledgment by a bank as defined in paragraph (8) of this subsection that a sum of money has been received by the bank and its promise to repay the sum of money, which is considered a certificate of deposit by the bank issuing it, even if the writing provides that it is nontransferable or uses similar language.

(C) The term does not include:

(i) investment property;

(ii) letters of credit; or

(iii) writings that evidence a right to payment arising out of the use of a credit or charge card or information contained on or for use with the card.

(48)  "Inventory" means goods, other than farm products, which:

(A) are leased by a person as lessor;

(B) are held by a person for sale or lease or to be furnished under a contract of service;

(C) are furnished by a person under a contract of service; or

(D) consist of raw materials, work in process, or materials used or consumed in a business.

(49)  "Investment property" means a security, whether certificated or uncertificated, security entitlement, securities account, commodity contract, or commodity account.

(50)  "Jurisdiction of organization", with respect to a registered organization, means the jurisdiction under whose law the organization is organized.

(51)  "Letter-of-credit right" means a right to payment or performance under a letter of credit, whether or not the beneficiary has demanded or is at the time entitled to demand payment or performance.  The term does not include the right of a beneficiary to demand payment or performance under a letter of credit.

(52)  "Lien creditor" means:

(A) a creditor that has acquired a lien on the property involved by attachment, levy, or the like;

(B) an assignee for benefit of creditors from the time of assignment;

(C) a trustee in bankruptcy from the date of the filing of the petition; or

(D) a receiver in equity from the time of appointment.

(53) (A) "Manufactured home" means a structure, transportable in one or more sections, which:

(i) in the traveling mode, is eight body feet or more in width or forty (40) body feet or more in length, or, when erected on site, is three hundred twenty (320) or more square feet,

(ii) is built on a permanent chassis,

(iii) is designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and

(iv) includes the plumbing, heating, air-conditioning, and electrical systems contained therein.

(B) The term includes any structure that meets all of the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification required by the United States Secretary of Housing and Urban Development and complies with the standards established under Title 42 of the United States Code.

(54)  "Manufactured-home transaction" means a secured transaction:

(A) that creates a purchase-money security interest in a manufactured home, other than a manufactured home held as inventory; or

(B) in which a manufactured home, other than a manufactured home held as inventory, is the primary collateral.

(55)  "Mortgage" means a consensual interest in real property, including fixtures, which secures payment or performance of an obligation.

(56)  "New debtor" means a person that becomes bound as a debtor under subsection (d) of Section 19203 of this title by a security agreement previously entered into by another person.

(57) (A) "New value" means:

(i) money;

(ii) money's worth in property, services, or new credit; or

(iii) release by a transferee of an interest in property previously transferred to the transferee.

(B) The term does not include an obligation substituted for another obligation.

(58)  "Noncash proceeds" means proceeds other than cash proceeds.

(59) (A) "Obligor" means a person that, with respect to an obligation secured by a security interest in or an agricultural lien on the collateral:

(i) owes payment or other performance of the obligation;

(ii) has provided property other than the collateral to secure payment or other performance of the obligation; or

(iii) is otherwise accountable in whole or in part for payment or other performance of the obligation.

(B) The term does not include issuers or nominated persons under a letter of credit.

(60)  "Original debtor" means a person that, as debtor, entered into a security agreement to which a new debtor has become bound under subsection (d) of Section 19203 of this title.

(61)  "Payment intangible" means a general intangible under which the account debtor's principal obligation is a monetary obligation.

(62)  "Person related to", with respect to an individual, means:

(A) the spouse of the individual;

(B) a brother, brother-in-law, sister, or sister-in-law of the individual;

(C) an ancestor or lineal descendant of the individual or the individual's spouse; or

(D) any other relative, by blood or marriage, of the individual or the individual's spouse who shares the same home with the individual.

(63)  "Person related to", with respect to an organization, means:

(A) a person directly or indirectly controlling, controlled by, or under common control with the organization;

(B) an officer or director of, or a person performing similar functions with respect to, the organization;

(C) an officer or director of, or a person performing similar functions with respect to, a person described in subparagraph (A);

(D) the spouse of an individual described in subparagraph (A), (B), or (C) of this paragraph; or

(E) an individual who is related by blood or marriage to an individual described in subparagraph (A), (B), (C), or (D) of this paragraph and who shares the same home with the individual.

(64)  "Proceeds" means the following property:

(A) whatever is acquired upon the sale, lease, license, exchange, or other disposition of collateral;

(B) whatever is collected on, or distributed on account of, collateral;

(C) rights arising out of collateral;

(D) to the extent of the value of collateral, claims arising out of the loss, nonconformity, or interference with the use of, defects or infringement of rights in, or damage to, the collateral; or

(E) to the extent of the value of collateral and to the extent payable to the debtor or the secured party, insurance payable by reason of the loss or nonconformity of, defects or infringement of rights in, or damage to, the collateral.

(65)  "Promissory note" means an instrument that evidences a promise to pay a monetary obligation, does not evidence an order to pay, and does not contain an acknowledgment by a bank that the bank has received for deposit a sum of money or funds.

(66)  "Proposal" means a record authenticated by a secured party which includes the terms on which the secured party is willing to accept collateral in full or partial satisfaction of the obligation it secures pursuant to Sections 19620, 19621, and 19622 of this title.

(67)  "Public-finance transaction" means a secured transaction in connection with which:

(A) debt securities are issued;

(B) all or a portion of the securities issued have an initial stated maturity of at least twenty (20) years; and

(C) the debtor, obligor, secured party, account debtor or other person obligated on collateral, assignor or assignee of a secured obligation, or assignor or assignee of a security interest is a state or a governmental unit of a state.

(68)  "Pursuant to commitment", with respect to an advance made or other value given by a secured party, means pursuant to the secured party's obligation, whether or not a subsequent event of default or other event not within the secured party's control has relieved or may relieve the secured party from its obligation.

(69)  "Record", except as used in "for record", "of record", "record or legal title", and "record owner", means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.

(70)  "Registered organization" means an organization organized solely under the law of a single state or the United States and as to which the state or the United States must maintain a public record showing the organization to have been organized.

(71)  "Secondary obligor" means an obligor to the extent that:

(A) the obligor's obligation is secondary; or

(B) the obligor has a right of recourse with respect to an obligation secured by collateral against the debtor, another obligor, or property of either.

(72)  "Secured party" means:

(A) a person in whose favor a security interest is created or provided for under a security agreement, whether or not any obligation to be secured is outstanding;

(B) a person that holds an agricultural lien;

(C) a consignor;

(D) a person to which accounts, chattel paper, payment intangibles, or promissory notes have been sold;

(E) a trustee, indenture trustee, agent, collateral agent, or other representative in whose favor a security interest or agricultural lien is created or provided for; or

(F) a person that holds a security interest arising under Section 2401, 2505, paragraph (3) of Section 2711, paragraph (5) of Section 2A508, 4210, or 5118 of this title.

(73)  "Security agreement" means an agreement that creates or provides for a security interest.

(74)  "Send", in connection with a record or notification, means:

(A) to deposit in the mail, deliver for transmission, or transmit by any other usual means of communication, with postage or cost of transmission provided for, addressed to any address reasonable under the circumstances; or

(B) to cause the record or notification to be received within the time that it would have been received if properly sent under subparagraph (A) of this paragraph.

(75)  "Software" means a computer program and any supporting information provided in connection with a transaction relating to the program.  The term does not include a computer program that is included in the definition of goods.

(76)  "State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction of the United States.

(77)  "Supporting obligation" means a letter-of-credit right or secondary obligation that supports the payment or performance of an account, chattel paper, a document, a general intangible, an instrument, or investment property.

(78)  "Tangible chattel paper" means chattel paper evidenced by a record or records consisting of information that is inscribed on a tangible medium.

(79)  "Termination statement" means an amendment of a financing statement which:

(A) identifies, by its file number, the initial financing statement to which it relates; and

(B) indicates either that it is a termination statement or that the identified financing statement is no longer effective.

(80)  "Transmitting utility" means a person primarily engaged in the business of:

(A) operating a railroad, subway, street railway, or trolley bus;

(B) transmitting communications electrically, electromagnetically, or by light;

(C) transmitting goods by pipeline or sewer; or

(D) transmitting or producing and transmitting electricity, steam, gas, or water.

(b)  "Control" as provided in Section 7-106 of this title and the following definitions in other articles of this title apply to this article:

"Applicant" - Section 5102 of this title.

"Beneficiary" - Section 5102 of this title.

"Broker" - Section 8102 of this title.

"Certificated security" - Section 8102 of this title.

"Check" - Section 3104 of this title.

"Clearing corporation" - Section 8102 of this title.

"Contract for sale" - Section 2106 of this title.

"Customer" - Section 4104 of this title.

"Entitlement holder" - Section 8102 of this title.

"Financial asset" - Section 8102 of this title.

"Holder in due course" - Section 3302 of this title.

"Issuer" (with respect to a letter of credit or letter-of-credit right)- Section 5102 of this title.

"Issuer" - (with respect to a security) - Section 8-201 of this title.

"Issuer" - (with respect to documents of title) - Section 7-102 of this title.

"Lease" - Section 2A103 of this title.

"Lease agreement" - Section 2A103 of this title.

"Lease contract" - Section 2A103 of this title.

"Leasehold interest" - Section 2A103 of this title.

"Lessee" - Section 2A103 of this title.

"Lessee in ordinary course of business" - Section 2A103 of this title.

"Lessor" - Section 2A103 of this title.

"Lessor's residual interest" - Section 2A103 of this title.

"Letter of credit" - Section 5102 of this title.

"Merchant" - Section 2104 of this title.

"Negotiable instrument" - Section 3104 of this title.

"Nominated person" - Section 5102 of this title.

"Note" - Section 3104 of this title.

"Proceeds of a letter of credit" - Section 5114 of this title.

"Prove" - Section 3103 of this title.

"Sale" - Section 2106 of this title.

"Securities account" - Section 8501 of this title.

"Securities intermediary" - Section 8102 of this title.

"Security" - Section 8102 of this title.

"Security certificate" - Section 8102 of this title.

"Security entitlement" - Section 8102 of this title.

"Uncertificated security" - Section 8102 of this title.

(c)  Article 1 of this title contains general definitions and principles of construction and interpretation applicable throughout this article.

Added by Laws 2000, c. 371, § 2, eff. July 1, 2001.  Amended by Laws 2004, c. 153, § 1, eff. Nov. 1, 2004; Laws 2005, c. 140, § 59, eff. Jan. 1, 2006.

§12A-1-9-103.  Purchase-money security interest; application of payments; burden of establishing.

PURCHASE-MONEY SECURITY INTEREST; APPLICATION OF PAYMENTS;

BURDEN OF ESTABLISHING

(a)  In this section:

(1)  "purchase-money collateral" means goods or software that secures a purchase-money obligation incurred with respect to that collateral; and

(2)  "purchase-money obligation" means an obligation of an obligor incurred as all or part of the price of the collateral or for value given to enable the debtor to acquire rights in or the use of the collateral if the value is in fact so used.

(b)  A security interest in goods is a purchase-money security interest:

(1)  to the extent that the goods are purchase-money collateral with respect to that security interest;

(2)  if the security interest is in inventory that is or was purchase-money collateral, to the extent that the security interest secures a purchase-money obligation incurred with respect to other inventory in which the secured party holds or held a purchase-money security interest; and

(3)  to the extent that the security interest secures a purchase-money obligation incurred with respect to software in which the secured party holds or held a purchase-money security interest.

(c)  A security interest in software is a purchase-money security interest to the extent that the security interest also secures a purchase-money obligation incurred with respect to goods in which the secured party holds or held a purchase-money security interest if:

(1)  the debtor acquired its interest in the software in an integrated transaction in which it acquired an interest in the goods; and

(2)  the debtor acquired its interest in the software for the principal purpose of using the software in the goods.

(d)  The security interest of a consignor in goods that are the subject of a consignment is a purchase-money security interest in inventory.

(e)  In a transaction other than a consumer-goods transaction, if the extent to which a security interest is a purchase-money security interest depends on the application of a payment to a particular obligation, the payment must be applied:

(1)  in accordance with any reasonable method of application to which the parties agree;

(2)  in the absence of the parties' agreement to a reasonable method, in accordance with any intention of the obligor manifested at or before the time of payment; or

(3)  in the absence of an agreement to a reasonable method and a timely manifestation of the obligor's intention, in the following order:

(A) to obligations that are not secured; and

(B) if more than one obligation is secured, to obligations secured by purchase-money security interests in the order in which those obligations were incurred.

(f)  In a transaction other than a consumer-goods transaction, a purchase-money security interest does not lose its status as such, even if:

(1)  the purchase-money collateral also secures an obligation that is not a purchase-money obligation;

(2)  collateral that is not purchase-money collateral also secures the purchase-money obligation; or

(3)  the purchase-money obligation has been renewed, refinanced, consolidated, or restructured.

(g)  In a transaction other than a consumer-goods transaction, a secured party claiming a purchase-money security interest has the burden of establishing the extent to which the security interest is a purchase-money security interest.

(h)  The limitation of the rules in subsections (e), (f), and (g) of this section to transactions other than consumer-goods transactions is intended to leave to the court the determination of the proper rules in consumer-goods transactions.  The court may not infer from that limitation the nature of the proper rule in consumer-goods transactions and may continue to apply established approaches.

Added by Laws 2000, c. 371, § 3, eff. July 1, 2001.

§12A-1-9-104.  Control of deposit account.

CONTROL OF DEPOSIT ACCOUNT

(a)  A secured party has control of a deposit account if:

(1)  the secured party is the bank with which the deposit account is maintained;

(2)  the debtor, secured party, and bank have agreed in an authenticated record that the bank will comply with instructions originated by the secured party directing disposition of the funds in the deposit account without further consent by the debtor; or

(3)  the secured party becomes the bank's customer with respect to the deposit account.

(b)  A secured party that has satisfied subsection (a) of this section has control, even if the debtor retains the right to direct the disposition of funds from the deposit account.

Added by Laws 2000, c. 371, § 4, eff. July 1, 2001.

§12A-1-9-105.  Control of electronic chattel paper.

CONTROL OF ELECTRONIC CHATTEL PAPER

A secured party has control of electronic chattel paper if the record or records comprising the chattel paper are created, stored, and assigned in such a manner that:

(1)  a single authoritative copy of the record or records exists which is unique, identifiable and, except as otherwise provided in paragraphs (4), (5), and (6) of this section, unalterable;

(2)  the authoritative copy identifies the secured party as the assignee of the record or records;

(3)  the authoritative copy is communicated to and maintained by the secured party or its designated custodian;

(4)  copies or revisions that add or change an identified assignee of the authoritative copy can be made only with the participation of the secured party;

(5)  each copy of the authoritative copy and any copy of a copy is readily identifiable as a copy that is not the authoritative copy; and

(6)  any revision of the authoritative copy is readily identifiable as an authorized or unauthorized revision.

Added by Laws 2000, c. 371, § 5, eff. July 1, 2001.

§12A-1-9-106.  Control of investment property.

CONTROL OF INVESTMENT PROPERTY

(a)  A person has control of a certificated security, uncertificated security, or security entitlement as provided in Section 8106 of this title.

(b)  A secured party has control of a commodity contract if:

(1)  the secured party is the commodity intermediary with which the commodity contract is carried; or

(2)  the commodity customer, secured party, and commodity intermediary have agreed that the commodity intermediary will apply any value distributed on account of the commodity contract as directed by the secured party without further consent by the commodity customer.

(c)  A secured party having control of all security entitlements or commodity contracts carried in a securities account or commodity account has control over the securities account or commodity account.

Added by Laws 2000, c. 371, § 6, eff. July 1, 2001.

§12A-1-9-107.  Control of letter-of-credit right.

CONTROL OF LETTER-OF-CREDIT RIGHT

A secured party has control of a letter-of-credit right to the extent of any right to payment or performance by the issuer or any nominated person if the issuer or nominated person has consented to an assignment of proceeds of the letter of credit under subsection (c) of Section 5114 of this title or otherwise applicable law or practice.

Added by Laws 2000, c. 371, § 7, eff. July 1, 2001.

§12A-1-9-108.  Sufficiency of description.

SUFFICIENCY OF DESCRIPTION

(a)  Except as otherwise provided in subsections (c), (d), and (e) of this section, a description of personal or real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.

(b)  Except as otherwise provided in subsection (d) of this section, a description of collateral reasonably identifies the collateral if it identifies the collateral by:

(1)  specific listing;

(2)  category;

(3)  except as otherwise provided in subsection (e) of this section, a type of collateral defined in this title;

(4)  quantity;

(5)  computational or allocational formula or procedure; or

(6)  except as otherwise provided in subsection (c) of this section, any other method, if the identity of the collateral is objectively determinable.

(c)  A description of collateral as "all the debtor's assets" or "all the debtor's personal property" or using words of similar import does not reasonably identify the collateral.

(d)  Except as otherwise provided in subsection (e) of this section, a description of a security entitlement, securities account, or commodity account is sufficient if it describes:

(1)  the collateral by those terms or as investment property; or

(2)  the underlying financial asset or commodity contract.

(e)  A description only by type of collateral defined in this title is an insufficient description of:

(1)  a commercial tort claim; or

(2)  in a consumer transaction, consumer goods, a security entitlement, a securities account, or a commodity account.

Added by Laws 2000, c. 371, § 8, eff. July 1, 2001.

§12A-1-9-109.  Scope of article.

SCOPE OF ARTICLE

(a)  Except as otherwise provided in subsections (c) and (d) of this section, this article applies to:

(1)  a transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract;

(2)  an agricultural lien;

(3)  a sale of accounts, chattel paper, payment intangibles, or promissory notes;

(4)  a consignment;

(5)  a security interest arising under Section 2401, Section 2505, paragraph (3) of Section 2711, or paragraph (5) of Section 2A508 of this title, as provided in Section 19110 of this title; and

(6)  a security interest arising under Section 4210 or 5118 of this title.

(b)  The application of this article to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this article does not apply.

(c)  This article does not apply to the extent that:

(1)  a statute, regulation, or treaty of the United States preempts this article;

(2)  another statute of this state expressly governs the creation, perfection, priority, or enforcement of a security interest created by this state or a governmental unit of this state;

(3)  a statute of another state, a foreign country, or a governmental unit of another state or a foreign country, other than a statute generally applicable to security interests, expressly governs creation, perfection, priority, or enforcement of a security interest created by the state, country, or governmental unit; or

(4)  the rights of a transferee beneficiary or nominated person under a letter of credit are independent and superior under Section 5-114 of this title.

(d)  This article does not apply to:

(1)  a landlord's lien, other than an agricultural lien;

(2)  a lien, other than an agricultural lien, given by statute or other rule of law for services or materials, but Section 19333 of this title applies with respect to priority of the lien;

(3)  an assignment of a claim for wages, salary, or other compensation of an employee;

(4)  a sale of accounts, chattel paper, payment intangibles, or promissory notes as part of a sale of the business out of which they arose;

(5)  an assignment of accounts, chattel paper, payment intangibles, or promissory notes which is for the purpose of collection only;

(6)  an assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract;

(7)  an assignment of a single account, payment intangible, or promissory note to an assignee in full or partial satisfaction of a preexisting indebtedness;

(8)  a transfer of an interest in or an assignment of a claim under a policy of insurance, other than an assignment by or to a health-care provider of a health-care-insurance receivable and any subsequent assignment of the right to payment, but Sections 19315 and 19322 of this title apply with respect to proceeds and priorities in proceeds;

(9)  an assignment of a right represented by a judgment, other than a judgment taken on a right to payment that was collateral;

(10)  a right of recoupment or set-off, but:

(A) Section 19340 of this title applies with respect to the effectiveness of rights of recoupment or set-off against deposit accounts; and

(B) Section 19404 of this title applies with respect to defenses or claims of an account debtor;

(11)  the creation or transfer of an interest in or lien on real property, including a lease or rents thereunder, except to the extent that provision is made for:

(A) liens on real property in Sections 19203 and 19308 of this title;

(B) fixtures in Section 19334 of this title;

(C) fixture filings in Sections 19501, 19502, 19512, 19516, and 19519 of this title; and

(D) security agreements covering personal and real property in Section 19604 of this title; or

(12)  an assignment of a claim arising in tort, other than a commercial tort claim, but Sections 19315 and 19322 of this title apply with respect to proceeds and priorities in proceeds.

Added by Laws 2000, c. 371, § 9, eff. July 1, 2001.  Amended by Laws 2004, c. 153, § 2, eff. Nov. 1, 2004.

§12A-1-9-110.  Security interests arising under article 2 or 2a.

SECURITY INTERESTS ARISING UNDER ARTICLE 2 OR 2A

A security interest arising under Section 2401, 2505, paragraph (3) of Section 2711, or paragraph (5) of Section 2A508 of this title is subject to this article.  However, until the debtor obtains possession of the goods:

(1)  the security interest is enforceable, even if paragraph (3) of subsection (b) of Section 19203 of this title has not been satisfied;

(2)  filing is not required to perfect the security interest;

(3)  the rights of the secured party after default by the debtor are governed by Article 2 or 2A of this title; and

(4)  the security interest has priority over a conflicting security interest created by the debtor.

Added by Laws 2000, c. 371, § 10, eff. July 1, 2001.

§12A-1-9-201.  General effectiveness of security agreement.

GENERAL EFFECTIVENESS OF SECURITY AGREEMENT

(a)  Except as otherwise provided in this title, a security agreement is effective according to its terms between the parties, against purchasers of the collateral, and against creditors.

(b)  A transaction subject to this article is subject to any applicable rule of law which establishes a different rule for consumers, and any other statute or regulation that regulates the rates, charges, agreements and practices for loans, credit sales or other extensions of credit.

(c)  In case of conflict between this article and a rule of law, statute, or regulation described in subsection (b) of this section, the rule of law, statute, or regulation controls.  Failure to comply with a statute or regulation described in subsection (b) of this section has only the effect the statute or regulation specifies.

(d)  This article does not:

(1)  validate any rate, charge, agreement, or practice that violates a rule of law, statute, or regulation described in subsection (b) of this section; or

(2)  extend the application of the rule of law, statute, or regulation to a transaction not otherwise subject to it.

Added by Laws 2000, c. 371, § 11, eff. July 1, 2001.

§12A-1-9-202.  Title to collateral immaterial.

TITLE TO COLLATERAL IMMATERIAL

Except as otherwise provided with respect to consignments or sales of accounts, chattel paper, payment intangibles, or promissory notes, the provisions of this article with regard to rights and obligations apply whether title to collateral is in the secured party or the debtor.

Added by Laws 2000, c. 371, § 12, eff. July 1, 2001.

§12A-1-9-203.  Attachment and enforceability of security interest - Proceeds - Supporting obligations - Formal requisites.

ATTACHMENT AND ENFORCEABILITY OF SECURITY INTEREST;

PROCEEDS; SUPPORTING OBLIGATIONS; FORMAL REQUISITES

(a)  A security interest attaches to collateral when it becomes enforceable against the debtor with respect to the collateral, unless an agreement expressly postpones the time of attachment.

(b)  Except as otherwise provided in subsections (c) through (i) of this section, a security interest is enforceable against the debtor and third parties with respect to the collateral only if:

(1)  value has been given;

(2)  the debtor has rights in the collateral or the power to transfer rights in the collateral to a secured party; and

(3)  one of the following conditions is met:

(A) the debtor has authenticated a security agreement that provides a description of the collateral and, if the security interest covers timber to be cut, a description of the land concerned;

(B) the collateral is not a certificated security and is in the possession of the secured party under Section 19313 of this title pursuant to the debtor's security agreement;

(C) the collateral is a certificated security in registered form and the security certificate has been delivered to the secured party under Section 8301 of this title pursuant to the debtor's security agreement; or

(D) the collateral is deposit accounts, electronic chattel paper, investment property, letter-of-credit rights, or electronic documents, and the secured party has control under Section 7-106, 19104, 19105, 19106, or 19107 of this title pursuant to the debtor's security agreement.

(c)  Subsection (b) of this section is subject to Section 4210 of this title on the security interest of a collecting bank, Section 5118 of this title on the security interest of a letter-of-credit issuer or nominated person, Section 19110 of this title on a security interest arising under Article 2 or 2A of this title, and Section 19206 of this title on security interests in investment property.

(d)  A person becomes bound as debtor by a security agreement entered into by another person if, by operation of law other than this article or by contract:

(1)  the security agreement becomes effective to create a security interest in the person's property; or

(2)  the person becomes generally obligated for the obligations of the other person, including the obligation secured under the security agreement, and acquires or succeeds to all or substantially all of the assets of the other person.

(e)  If a new debtor becomes bound as debtor by a security agreement entered into by another person:

(1)  the agreement satisfies paragraph (3) of subsection (b) of this section with respect to existing or after-acquired property of the new debtor to the extent the property is described in the agreement; and

(2)  another agreement is not necessary to make a security interest in the property enforceable.

(f)  The attachment of a security interest in collateral gives the secured party the rights to proceeds provided by Section 19315 of this title and is also attachment of a security interest in a supporting obligation for the collateral.

(g)  The attachment of a security interest in a right to payment or performance secured by a security interest or other lien on personal or real property is also attachment of a security interest in the security interest, mortgage, or other lien.

(h)  The attachment of a security interest in a securities account is also attachment of a security interest in the security entitlements carried in the securities account.

(i)  The attachment of a security interest in a commodity account is also attachment of a security interest in the commodity contracts carried in the commodity account.

Added by Laws 2000, c. 371, § 13, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 60, eff. Jan. 1, 2006.

§12A-1-9-204.  After-acquired property; future advances.

AFTER-ACQUIRED PROPERTY; FUTURE ADVANCES

(a)  Except as otherwise provided in subsection (b) of this section, a security agreement may create or provide for a security interest in after-acquired collateral.

(b)  A security interest does not attach under a term constituting an afteracquired property clause to:

(1)  consumer goods, other than an accession when given as additional security, unless the debtor acquires rights in them within ten (10) days after the secured party gives value; or

(2)  a commercial tort claim.

(c)  A security agreement may provide that collateral secures, or that accounts, chattel paper, payment intangibles, or promissory notes are sold in connection with, future advances or other value, whether or not the advances or value are given pursuant to commitment.

Added by Laws 2000, c. 371, § 14, eff. July 1, 2001.

§12A-1-9-205.  Use or disposition of collateral permissible.

USE OR DISPOSITION OF COLLATERAL PERMISSIBLE

(a)  A security interest is not invalid or fraudulent against creditors solely because:

(1)  the debtor has the right or ability to:

(A) use, commingle, or dispose of all or part of the collateral, including returned or repossessed goods;

(B) collect, compromise, enforce, or otherwise deal with collateral;

(C) accept the return of collateral or make repossessions; or

(D) use, commingle, or dispose of proceeds; or

(2)  the secured party fails to require the debtor to account for proceeds or replace collateral.

(b)  This section does not relax the requirements of possession if attachment, perfection, or enforcement of a security interest depends upon possession of the collateral by the secured party.

Added by Laws 2000, c. 371, § 15, eff. July 1, 2001.

§12A-1-9-206.  Security interest arising in purchase or delivery of financial asset.

SECURITY INTEREST ARISING IN PURCHASE

OR DELIVERY OF FINANCIAL ASSET

(a)  A security interest in favor of a securities intermediary attaches to a person's security entitlement if:

(1)  the person buys a financial asset through the securities intermediary in a transaction in which the person is obligated to pay the purchase price to the securities intermediary at the time of the purchase; and

(2)  the securities intermediary credits the financial asset to the buyer's securities account before the buyer pays the securities intermediary.

(b)  The security interest described in subsection (a) of this section secures the person's obligation to pay for the financial asset.

(c)  A security interest in favor of a person that delivers a certificated security or other financial asset represented by a writing attaches to the security or other financial asset if:

(1)  the security or other financial asset:

(A) in the ordinary course of business is transferred by delivery with any necessary endorsement or assignment; and

(B) is delivered under an agreement between persons in the business of dealing with such securities or financial assets; and

(2)  the agreement calls for delivery against payment.

(d)  The security interest described in subsection (c) of this section secures the obligation to make payment for the delivery.

Added by Laws 2000, c. 371, § 16, eff. July 1, 2001.

§12A-1-9-207.  Rights and duties of secured party having possession or control of collateral.

RIGHTS AND DUTIES OF SECURED PARTY

HAVING POSSESSION OR CONTROL OF COLLATERAL

(a)  Except as otherwise provided in subsection (d) of this section, a secured party shall use reasonable care in the custody and preservation of collateral in the secured party's possession.  In the case of chattel paper or an instrument, reasonable care includes taking necessary steps to preserve rights against prior parties unless otherwise agreed.

(b)  Except as otherwise provided in subsection (d) of this section, if a secured party has possession of collateral:

(1)  reasonable expenses, including the cost of insurance and payment of taxes or other charges, incurred in the custody, preservation, use, or operation of the collateral are chargeable to the debtor and are secured by the collateral;

(2)  the risk of accidental loss or damage is on the debtor to the extent of a deficiency in any effective insurance coverage;

(3)  the secured party shall keep the collateral identifiable, but fungible collateral may be commingled; and

(4)  the secured party may use or operate the collateral:

(A) for the purpose of preserving the collateral or its value;

(B) as permitted by an order of a court having competent jurisdiction; or

(C) except in the case of consumer goods, in the manner and to the extent agreed by the debtor.

(c)  Except as otherwise provided in subsection (d) of this section, a secured party having possession of collateral or control of collateral under Section 7-106, 19104, 19105, 19106, or 19107 of this title:

(1)  may hold as additional security any proceeds, except money or funds, received from the collateral;

(2)  shall apply money or funds received from the collateral to reduce the secured obligation, unless remitted to the debtor; and

(3)  may create a security interest in the collateral.

(d)  If the secured party is a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor:

(1)  subsection (a) of this section does not apply unless the secured party is entitled under an agreement:

(A) to charge back uncollected collateral; or

(B) otherwise to full or limited recourse against the debtor or a secondary obligor based on the nonpayment or other default of an account debtor or other obligor on the collateral; and

(2)  subsections (b) and (c) of this section do not apply.

Added by Laws 2000, c. 371, § 17, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 61, eff. Jan. 1, 2006.

§12A-1-9-208.  Additional duties of secured party having control of collateral.

ADDITIONAL DUTIES OF SECURED PARTY

HAVING CONTROL OF COLLATERAL

(a)  This section applies to cases in which there is no outstanding secured obligation and the secured party is not committed to make advances, incur obligations, or otherwise give value.

(b)  Within ten (10) days after receiving an authenticated demand by the debtor:

(1)  a secured party having control of a deposit account under paragraph (2) of subsection (a) of Section 19104 of this title shall send to the bank with which the deposit account is maintained an authenticated statement that releases the bank from any further obligation to comply with instructions originated by the secured party;

(2)  a secured party having control of a deposit account under paragraph (3) of subsection (a) of Section 19104 of this title shall:

(A) pay the debtor the balance on deposit in the deposit account; or

(B) transfer the balance on deposit into a deposit account in the debtor's name;

(3)  a secured party, other than a buyer, having control of electronic chattel paper under Section 19105 of this title shall:

(A) communicate the authoritative copy of the electronic chattel paper to the debtor or its designated custodian;

(B) if the debtor designates a custodian that is the designated custodian with which the authoritative copy of the electronic chattel paper is maintained for the secured party, communicate to the custodian an authenticated record releasing the designated custodian from any further obligation to comply with instructions originated by the secured party and instructing the custodian to comply with instructions originated by the debtor; and

(C) take appropriate action to enable the debtor or its designated custodian to make copies of or revisions to the authoritative copy which add or change an identified assignee of the authoritative copy without the consent of the secured party;

(4)  a secured party having control of investment property under paragraph (2) of subsection (d) of Section 8106 of this title or subsection (b) of Section 19106 of this title shall send to the securities intermediary or commodity intermediary with which the security entitlement or commodity contract is maintained an authenticated record that releases the securities intermediary or commodity intermediary from any further obligation to comply with entitlement orders or directions originated by the secured party;

(5)  a secured party having control of a letter-of-credit right under Section 19107 of this title shall send to each person having an unfulfilled obligation to pay or deliver proceeds of the letter of credit to the secured party an authenticated release from any further obligation to pay or deliver proceeds of the letter of credit to the secured party; and

(6)  a secured party having control of an electronic document shall:

(A) give control of the electronic document to the debtor or its designated custodian;

(B) if the debtor designates a custodian that is the designated custodian with which the authoritative copy of the electronic document is maintained for the secured party, communicate to the custodian an authenticated record releasing the designated custodian from any further obligation to comply with instructions originated by the secured party and instructing the custodian to comply with instructions originated by the debtor; and

(C) take appropriate action to enable the debtor or its designated custodian to make copies of or revisions to the authoritative copy which add or change an identified assignee of the authoritative copy without the consent of the secured party.

Added by Laws 2000, c. 371, § 18, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 62, eff. Jan 1, 2006.

§12A-1-9-209.  Duties of secured party if account debtor has been notified of assignment.

DUTIES OF SECURED PARTY IF ACCOUNT

DEBTOR HAS BEEN NOTIFIED OF ASSIGNMENT

(a)  Except as otherwise provided in subsection (c) of this section, this section applies if:

(1)  there is no outstanding secured obligation; and

(2)  the secured party is not committed to make advances, incur obligations, or otherwise give value.

(b)  Within ten (10) days after receiving an authenticated demand by the debtor, a secured party shall send to an account debtor that has received notification of an assignment to the secured party as assignee under subsection (a) of Section 19406 of this title an authenticated record that releases the account debtor from any further obligation to the secured party.

(c)  This section does not apply to an assignment constituting the sale of an account, chattel paper, or payment intangible.

Added by Laws 2000, c. 371, § 19, eff. July 1, 2001.

§12A-1-9-210.  Request for accounting; request regarding list of collateral or statement of account.

REQUEST FOR ACCOUNTING; REQUEST REGARDING

LIST OF COLLATERAL OR STATEMENT OF ACCOUNT

(a)  In this section:

(1)  "Request" means a record of a type described in paragraph (2), (3), or (4) of this subsection.

(2)  "Request for an accounting" means a record authenticated by a debtor requesting that the recipient provide an accounting of the unpaid obligations secured by collateral and reasonably identifying the transaction or relationship that is the subject of the request.

(3)  "Request regarding a list of collateral" means a record authenticated by a debtor requesting that the recipient approve or correct a list of what the debtor believes to be the collateral securing an obligation and reasonably identifying the transaction or relationship that is the subject of the request.

(4)  "Request regarding a statement of account" means a record authenticated by a debtor requesting that the recipient approve or correct a statement indicating what the debtor believes to be the aggregate amount of unpaid obligations secured by collateral as of a specified date and reasonably identifying the transaction or relationship that is the subject of the request.

(b)  Subject to subsections (c), (d), (e), and (f) of this section, a secured party, other than a buyer of accounts, chattel paper, payment intangibles, or promissory notes or a consignor, shall comply with a request within fourteen (14) days after receipt:

(1)  in the case of a request for an accounting, by authenticating and sending to the debtor an accounting; and

(2)  in the case of a request regarding a list of collateral or a request regarding a statement of account, by authenticating and sending to the debtor an approval or correction.

(c)  A secured party that claims a security interest in all of a particular type of collateral owned by the debtor may comply with a request regarding a list of collateral by sending to the debtor an authenticated record including a statement to that effect within fourteen (14) days after receipt.

(d)  A person that receives a request regarding a list of collateral, claims no interest in the collateral when it receives the request, and claimed an interest in the collateral at an earlier time shall comply with the request within fourteen (14) days after receipt by sending to the debtor an authenticated record:

(1)  disclaiming any interest in the collateral; and

(2)  if known to the recipient, providing the name and mailing address of any assignee of or successor to the recipient's interest in the collateral.

(e)  A person that receives a request for an accounting or a request regarding a statement of account, claims no interest in the obligations when it receives the request, and claimed an interest in the obligations at an earlier time shall comply with the request within fourteen (14) days after receipt by sending to the debtor an authenticated record:

(1)  disclaiming any interest in the obligations; and

(2)  if known to the recipient, providing the name and mailing address of any assignee of or successor to the recipient's interest in the obligations.

(f)  A debtor is entitled without charge to one response to a request under this section during any six-month period.  The secured party may require payment of a charge not exceeding Twenty-five Dollars ($25.00) for each additional response.

Added by Laws 2000, c. 371, § 20, eff. July 1, 2001.

§12A-1-9-301.  Law governing perfection and priority of security interests.

LAW GOVERNING PERFECTION AND PRIORITY OF SECURITY INTERESTS

Except as otherwise provided in Sections 19303 through 19306 of this title, the following rules determine the law governing perfection, the effect of perfection or nonperfection, and the priority of a security interest in collateral:

(1)  Except as otherwise provided in this section, while a debtor is located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in collateral.

(2)  While collateral is located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a possessory security interest in that collateral.

(3)  Except as otherwise provided in paragraph (4) of this section, while tangible negotiable documents, goods, instruments, money, or tangible chattel paper is located in a jurisdiction, the local law of that jurisdiction governs:

(A) perfection of a security interest in the goods by filing a fixture filing;

(B) perfection of a security interest in timber to be cut; and

(C) the effect of perfection or nonperfection and the priority of a nonpossessory security interest in the collateral.

(4)  The local law of the jurisdiction in which the wellhead or minehead is located governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in as-extracted collateral.

Added by Laws 2000, c. 371, § 21, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 63, eff. Jan. 1, 2006.

§12A-1-9-302.  Law governing perfection and priority of agricultural liens.

LAW GOVERNING PERFECTION AND PRIORITY OF AGRICULTURAL LIENS

While farm products are located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of an agricultural lien on the farm products.

Added by Laws 2000, c. 371, § 22, eff. July 1, 2001.

§12A-1-9-303.  Law governing perfection and priority of security interests in goods covered by a certificate of title.

LAW GOVERNING PERFECTION AND PRIORITY OF SECURITY

INTERESTS IN GOODS COVERED BY A CERTIFICATE OF TITLE

(a)  This section applies to goods covered by a certificate of title, even if there is no other relationship between the jurisdiction under whose certificate of title the goods are covered and the goods or the debtor.

(b)  Goods become covered by a certificate of title when a valid application for the certificate of title and the applicable fee are delivered to the appropriate authority.  Goods cease to be covered by a certificate of title at the earlier of the time the certificate of title ceases to be effective under the law of the issuing jurisdiction or the time the goods become covered subsequently by a certificate of title issued by another jurisdiction.

(c)  The local law of the jurisdiction under whose certificate of title the goods are covered governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in goods covered by a certificate of title from the time the goods become covered by the certificate of title until the goods cease to be covered by the certificate of title.

Added by Laws 2000, c. 371, § 23, eff. July 1, 2001.

§12A-1-9-304.  Law governing perfection and priority of security interests in deposit accounts.

LAW GOVERNING PERFECTION AND PRIORITY OF

SECURITY INTERESTS IN DEPOSIT ACCOUNTS

(a)  The local law of a bank's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a deposit account maintained with that bank.

(b)  The following rules determine a bank's jurisdiction for purposes of this part:

(1)  If an agreement between the bank and its customer governing the deposit account expressly provides that a particular jurisdiction is the bank's jurisdiction for purposes of this part, this article, or the Uniform Commercial Code, that jurisdiction is the bank's jurisdiction.

(2)  If paragraph (1) of this subsection does not apply and an agreement between the bank and its customer governing the deposit account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the bank's jurisdiction.

(3)  If neither paragraph (1) nor paragraph (2) of this subsection applies and an agreement between the bank and its customer governing the deposit account expressly provides that the deposit account is maintained at an office in a particular jurisdiction, that jurisdiction is the bank's jurisdiction.

(4)  If none of the preceding paragraphs of this subsection applies, the bank's jurisdiction is the jurisdiction in which the office identified in an account statement as the office serving the customer's account is located.

(5)  If none of the preceding paragraphs applies, the bank's jurisdiction is the jurisdiction in which the chief executive office of the bank is located.

Added by Laws 2000, c. 371, § 24, eff. July 1, 2001.  Amended by Laws 2004, c. 153, § 3, eff. Nov. 1, 2004.

§12A-1-9-305.  Law governing perfection and priority of security interests in investment property.

LAW GOVERNING PERFECTION AND PRIORITY

OF SECURITY INTERESTS IN INVESTMENT PROPERTY

(a)  Except as otherwise provided in subsection (c) of this section, the following rules apply:

(1)  While a security certificate is located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in the certificated security represented thereby.

(2)  The local law of the issuer's jurisdiction as specified in subsection (d) of Section 8110 of this title governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in an uncertificated security.

(3)  The local law of the securities intermediary's jurisdiction as specified in subsection (e) of Section 8110 of this title governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a security entitlement or securities account.

(4)  The local law of the commodity intermediary's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a commodity contract or commodity account.

(b)  The following rules determine a commodity intermediary's jurisdiction for purposes of this part:

(1)  If an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that a particular jurisdiction is the commodity intermediary's jurisdiction for purposes of this part, this article, or this title, that jurisdiction is the commodity intermediary's jurisdiction.

(2)  If paragraph (1) of this subsection does not apply and an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that the agreement is governed by the law of a particular jurisdiction, that jurisdiction is the commodity intermediary's jurisdiction.

(3)  If neither paragraph (1) nor paragraph (2) of this subsection applies and an agreement between the commodity intermediary and commodity customer governing the commodity account expressly provides that the commodity account is maintained at an office in a particular jurisdiction, that jurisdiction is the commodity intermediary's jurisdiction.

(4)  If none of the preceding paragraphs of this section applies, the commodity intermediary's jurisdiction is the jurisdiction in which the office identified in an account statement as the office serving the commodity customer's account is located.

(5)  If none of the preceding paragraphs of this section applies, the commodity intermediary's jurisdiction is the jurisdiction in which the chief executive office of the commodity intermediary is located.

(c)  The local law of the jurisdiction in which the debtor is located governs:

(1)  perfection of a security interest in investment property by filing;

(2)  automatic perfection of a security interest in investment property created by a broker or securities intermediary; and

(3)  automatic perfection of a security interest in a commodity contract or commodity account created by a commodity intermediary.

Added by Laws 2000, c. 371, § 25, eff. July 1, 2001.

§12A-1-9-306.  Law governing perfection and priority of security interests in letter-of-credit rights.

LAW GOVERNING PERFECTION AND PRIORITY

OF SECURITY INTERESTS IN LETTER-OF-CREDIT RIGHTS

(a)  Subject to subsection (c) of this section, the local law of the issuer's jurisdiction or a nominated person's jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a security interest in a letter-of-credit right if the issuer's jurisdiction or nominated person's jurisdiction is a state.

(b)  For purposes of this part, an issuer's jurisdiction or nominated person's jurisdiction is the jurisdiction whose law governs the liability of the issuer or nominated person with respect to the letter-of-credit right as provided in Section 5116 of this title.

(c)  This section does not apply to a security interest that is perfected only under subsection (d) of Section 19308 of this title.

Added by Laws 2000, c. 371, § 26, eff. July 1, 2001.

§12A-1-9-307.  Location of debtor.

LOCATION OF DEBTOR

(a)  In this section, "place of business" means a place where a debtor conducts its affairs.

(b)  Except as otherwise provided in this section, the following rules determine a debtor's location:

(1)  A debtor who is an individual is located at the individual's principal residence;

(2)  A debtor that is an organization and has only one place of business is located at its place of business; and

(3)  A debtor that is an organization and has more than one place of business is located at its chief executive office.

(c)  Subsection (b) of this section of this section applies only if a debtor's residence, place of business, or chief executive office, as applicable, is located in a jurisdiction whose law generally requires information concerning the existence of a nonpossessory security interest to be made generally available in a filing, recording, or registration system as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the collateral.  If subsection (b) of this section does not apply, the debtor is located in the District of Columbia.

(d)  A person that ceases to exist, have a residence, or have a place of business continues to be located in the jurisdiction specified by subsections (b) and (c) of this section.

(e)  A registered organization that is organized under the law of a state is located in that state.

(f)  Except as otherwise provided in subsection (i) of this section, a registered organization that is organized under the law of the United States and a branch or agency of a bank that is not organized under the law of the United States or a state are located:

(1)  in the state that the law of the United States designates, if the law designates a state of location;

(2)  in the state that the registered organization, branch, or agency designates, if the law of the United States authorizes the registered organization, branch, or agency to designate its state of location; or

(3)  in the District of Columbia, if neither paragraph (1) nor paragraph (2) of this subsection applies.

(g)  A registered organization continues to be located in the jurisdiction specified by subsection (e) or (f) of this section notwithstanding:

(1)  the suspension, revocation, forfeiture, or lapse of the registered organization's status as such in its jurisdiction of organization; or

(2)  the dissolution, winding up, or cancellation of the existence of the registered organization.

(h)  The United States is located in the District of Columbia.

(i)  A branch or agency of a bank that is not organized under the law of the United States or a state is located in the state in which the branch or agency is licensed, if all branches and agencies of the bank are licensed in only one state.

(j)  A foreign air carrier under the Federal Aviation Act of 1958, as amended, is located at the designated office of the agent upon which service of process may be made on behalf of the carrier.

(k)  This section applies only for purposes of this part.

Added by Laws 2000, c. 371, § 27, eff. July 1, 2001.

§12A-1-9-308.  When security interest or agricultural lien is perfected; continuity of perfection.

WHEN SECURITY INTEREST OR AGRICULTURAL

LIEN IS PERFECTED; CONTINUITY OF PERFECTION

(a)  Except as otherwise provided in this section and Section 19309 of this title, a security interest is perfected if it has attached and all of the applicable requirements for perfection in Sections 19310 through 19316 of this title have been satisfied.  A security interest is perfected when it attaches if the applicable requirements are satisfied before the security interest attaches.

(b)  An agricultural lien is perfected if it has become effective and all of the applicable requirements for perfection in Section 19310 of this title have been satisfied.  An agricultural lien is perfected when it becomes effective if the applicable requirements are satisfied before the agricultural lien becomes effective.

(c)  A security interest or agricultural lien is perfected continuously if it is originally perfected by one method under this article and is later perfected by another method under this article, without an intermediate period when it was unperfected.

(d)  Perfection of a security interest in collateral also perfects a security interest in a supporting obligation for the collateral.

(e)  Perfection of a security interest in a right to payment or performance also perfects a security interest in a security interest, mortgage, or other lien on personal or real property securing the right.

(f)  Perfection of a security interest in a securities account also perfects a security interest in the security entitlements carried in the securities account.

(g)  Perfection of a security interest in a commodity account also perfects a security interest in the commodity contracts carried in the commodity account.

Added by Laws 2000, c. 371, § 28, eff. July 1, 2001.

§12A-1-9-309.  Security interest perfected upon attachment.

SECURITY INTEREST PERFECTED UPON ATTACHMENT

The following security interests are perfected when they attach:

(1)  a purchase-money security interest in consumer goods, except as otherwise provided in subsection (b) of Section 19311 of this title with respect to consumer goods that are subject to a statute or treaty described in subsection (a) of Section 19311 of this title;

(2)  an assignment of accounts or payment intangibles which does not by itself or in conjunction with other assignments to the same assignee transfer a significant part of the assignor's outstanding accounts or payment intangibles;

(3)  a sale of a payment intangible;

(4)  a sale of a promissory note;

(5)  a security interest created by the assignment of a health-care-insurance receivable to the provider of the health-care goods or services;

(6)  a security interest arising under Section 2401, 2505, paragraph (3) of Section 2711, or paragraph (5) of Section 2A508 of this title, until the debtor obtains possession of the collateral;

(7)  a security interest of a collecting bank arising under Section 4210 of this title;

(8)  a security interest of an issuer or nominated person arising under Section 5118 of this title;

(9)  a security interest arising in the delivery of a financial asset under subsection (c) of Section 19206 of this title;

(10)  a security interest in investment property created by a broker or securities intermediary;

(11)  a security interest in a commodity contract or a commodity account created by a commodity intermediary;

(12)  an assignment for the benefit of all creditors of the transferor and subsequent transfers by the assignee thereunder;

(13)  a security interest created by an assignment of a beneficial interest in a decedent's estate; and

(14)  a sale by an individual of an account that is a right to payment of winnings in a lottery or other game of chance.

Added by Laws 2000, c. 371, § 29, eff. July 1, 2001.  Amended by Laws 2004, c. 153, § 4, eff. Nov. 1, 2004.

§12A-1-9-310.  When filing required to perfect security interest or agricultural lien - Security interests and agricultural liens to which filing provisions do not apply.

WHEN FILING REQUIRED TO PERFECT SECURITY INTEREST OR

AGRICULTURAL LIEN; SECURITY INTERESTS AND AGRICULTURAL

LIENS TO WHICH FILING PROVISIONS DO NOT APPLY

(a)  Except as otherwise provided in subsection (b) of this section and Section 19312 of this title, a financing statement must be filed to perfect all security interests and agricultural liens.

(b)  The filing of a financing statement is not necessary to perfect a security interest:

(1)  that is perfected under subsection (d), (e), (f), or (g) of Section 19308 of this title;

(2)  that is perfected under Section 19309 of this title when it attaches;

(3)  in property subject to a statute, regulation, or treaty described in subsection (a) of Section 19311 of this title;

(4)  in goods in possession of a bailee which is perfected under paragraph (1) or (2) of subsection (d) of Section 19312 of this title;

(5)  in certificated securities, documents, goods, or instruments which is perfected without filing, control, or possession under subsection (e), (f), or (g) of Section 19312 of this title;

(6)  in collateral in the secured party's possession under Section 19313 of this title;

(7)  in a certificated security which is perfected by delivery of the security certificate to the secured party under Section 19313 of this title;

(8)  in deposit accounts, electronic chattel paper, investment property, or letter-of-credit rights which is perfected by control under Section 19314 of this title;

(9)  in proceeds which is perfected under Section 19315 of this title; or

(10)  that is perfected under Section 19316 of this title.

(c)  If a secured party assigns a perfected security interest or agricultural lien, a filing under this article is not required to continue the perfected status of the security interest against creditors of and transferees from the original debtor.

Added by Laws 2000, c. 371, § 30, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 64, eff. Jan. 1, 2006.

§12A-1-9-311.  Perfection of security interests in property subject to certain statutes, regulations, and treaties.

PERFECTION OF SECURITY INTERESTS IN PROPERTY

SUBJECT TO CERTAIN STATUTES, REGULATIONS, AND TREATIES

(a)  Except as otherwise provided in subsection (d) of this section, the filing of a financing statement is not necessary or effective to perfect a security interest in property subject to:

(1)  a statute, regulation, or treaty of the United States whose requirements for a security interest's obtaining priority over the rights of a lien creditor with respect to the property preempt subsection (a) of Section 19310 of this title;

(2)  another statute of this state that provides for central filing of, or that requires indication on or delivery for indication on a certificate of title of, any security interest in the property as a condition or result of perfection, including, but not limited to, Section 1110 of Title 47 and Section 4013 of Title 63 of the Oklahoma Statutes;

(3)  a certificate-of-title statute of another jurisdiction which provides for a security interest to be indicated on the certificate as a condition or result of the security interest's obtaining priority over the rights of a lien creditor with respect to the property; or

(4)  the law or procedure of a federally recognized Indian tribe, if the security interest is in a vehicle registered or to be registered by the federally recognized Indian tribe and if within thirty (30) days after the security interest attaches, it is noted on the face of a certificate of title issued by the Indian tribe or, notwithstanding subsection G of Section 1110 of Title 47 of the Oklahoma Statutes, the security interest is otherwise perfected under an applicable law or procedure of that tribe.

(b)  Compliance with the requirements of a statute, regulation, or treaty described in subsection (a) of this section for obtaining priority over the rights of a lien creditor is equivalent to the filing of a financing statement under this article.  Except as otherwise provided in subsection (d) of this section and Section 19313 and subsections (d) and (e) of Section 19316 of this title for goods covered by a certificate of title, a security interest in property subject to a statute, regulation, or treaty described in subsection (a) of this section may be perfected only by compliance with those requirements, and a security interest so perfected remains perfected notwithstanding a change in the use or transfer of possession of the collateral.

(c)  Except as otherwise provided in subsection (d) of this section and subsections (d) and (e) of Section 19316 of this title, duration and renewal of perfection of a security interest perfected by compliance with the requirements prescribed by a statute, regulation, or treaty described in subsection (a) of this section are governed by the statute, regulation, or treaty.  In other respects, the security interest is subject to this article.

(d)  During any period in which collateral, described in Section 1110 of Title 47 and Section 4013 of Title 63 of the Oklahoma Statutes, is inventory held for sale or lease by a person or leased by that person as lessor and that person is in the business of selling goods of that kind, this section does not apply to a security interest in that collateral created by that person as debtor.

Added by Laws 2000, c. 371, § 31, eff. July 1, 2001.  Amended by Laws 2001, c. 354, § 1, eff. July 1, 2001; Laws 2005, c. 139, § 37, emerg. eff. May 5, 2005.

§12A-1-9-312.  Perfection of security interests in chattel paper, deposit accounts, documents, goods covered by documents, instruments, investment property, letter-of-credit rights, and money - Perfection by permissive filing - Temporary perfection without filing or transfer of possession.

PERFECTION OF SECURITY INTERESTS IN CHATTEL PAPER, DEPOSIT

ACCOUNTS, DOCUMENTS, GOODS COVERED BY DOCUMENTS, INSTRUMENTS,

INVESTMENT PROPERTY, LETTER-OF-CREDIT RIGHTS, AND MONEY;

PERFECTION BY PERMISSIVE FILING; TEMPORARY PERFECTION WITHOUT

FILING OR TRANSFER OF POSSESSION

(a)  A security interest in chattel paper, negotiable documents, instruments, or investment property may be perfected by filing.

(b)  Except as otherwise provided in subsections (c) and (d) of Section 19315 of this title for proceeds:

(1)  a security interest in a deposit account may be perfected only by control under Section 19314 of this title;

(2)  and except as otherwise provided in subsection (d) of Section 19308 of this title, a security interest in a letter-of-credit right may be perfected only by control under Section 19314 of this title; and

(3)  a security interest in money may be perfected only by the secured party's taking possession under Section 19313 of this title.

(c)  While goods are in the possession of a bailee that has issued a negotiable document covering the goods:

(1)  a security interest in the goods may be perfected by perfecting a security interest in the document; and

(2)  a security interest perfected in the document has priority over any security interest that becomes perfected in the goods by another method during that time.

(d)  While goods are in the possession of a bailee that has issued a nonnegotiable document covering the goods, a security interest in the goods may be perfected by:

(1)  issuance of a document in the name of the secured party;

(2)  the bailee's receipt of notification of the secured party's interest; or

(3)  filing as to the goods.

(e)  A security interest in certificated securities, negotiable documents, or instruments is perfected without filing or the taking of possession or control for a period of twenty (20) days from the time it attaches to the extent that it arises for new value given under an authenticated security agreement.

(f)  A perfected security interest in a negotiable document or goods in possession of a bailee, other than one that has issued a negotiable document for the goods, remains perfected for twenty (20) days without filing if the secured party makes available to the debtor the goods or documents representing the goods for the purpose of:

(1)  ultimate sale or exchange; or

(2)  loading, unloading, storing, shipping, transshipping, manufacturing, processing, or otherwise dealing with them in a manner preliminary to their sale or exchange.

(g)  A perfected security interest in a certificated security or instrument remains perfected for twenty (20) days without filing if the secured party delivers the security certificate or instrument to the debtor for the purpose of:

(1)  ultimate sale or exchange; or

(2)  presentation, collection, enforcement, renewal, or registration of transfer.

(h)  After the twentyday period specified in subsection (e), (f), or (g) of this section expires, perfection depends upon compliance with this article.

Added by Laws 2000, c. 371, § 32, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 65, eff. Jan. 1, 2006.

§12A-1-9-313.  When possession by or delivery to secured party perfects security interest without filing.

WHEN POSSESSION BY OR DELIVERY TO SECURED PARTY

PERFECTS SECURITY INTEREST WITHOUT FILING

(a)  Except as otherwise provided in subsection (b) of this section, a secured party may perfect a security interest in tangible negotiable documents, goods, instruments, money, or tangible chattel paper by taking possession of the collateral.  A secured party may perfect a security interest in certificated securities by taking delivery of the certificated securities under Section 8301 of this title.

(b)  With respect to goods covered by a certificate of title issued by this state, a secured party may perfect a security interest in the goods by taking possession of the goods only in the circumstances described in subsection (d) of Section 19316 of this title.

(c)  With respect to collateral other than certificated securities and goods covered by a document, a secured party takes possession of collateral in the possession of a person other than the debtor, the secured party, or a lessee of the collateral from the debtor in the ordinary course of the debtor's business, when:

(1)  the person in possession authenticates a record acknowledging that it holds possession of the collateral for the secured party's benefit; or

(2)  the person takes possession of the collateral after having authenticated a record acknowledging that it will hold possession of collateral for the secured party's benefit.

(d)  If perfection of a security interest depends upon possession of the collateral by a secured party, perfection occurs no earlier than the time the secured party takes possession and continues only while the secured party retains possession.

(e)  A security interest in a certificated security in registered form is perfected by delivery when delivery of the certificated security occurs under Section 8301 of this title and remains perfected by delivery until the debtor obtains possession of the security certificate.

(f)  A person in possession of collateral is not required to acknowledge that it holds possession for a secured party's benefit.

(g)  If a person acknowledges that it holds possession for the secured party's benefit:

(1)  the acknowledgment is effective under subsection (c) of this section or subsection (a) of Section 8301 of this title, even if the acknowledgment violates the rights of a debtor; and

(2)  unless the person otherwise agrees or law other than this article otherwise provides, the person does not owe any duty to the secured party and is not required to confirm the acknowledgment to another person.

(h)  A secured party having possession of collateral does not relinquish possession by delivering the collateral to a person other than the debtor or a lessee of the collateral from the debtor in the ordinary course of the debtor's business if the person was instructed before the delivery or is instructed contemporaneously with the delivery:

(1)  to hold possession of the collateral for the secured party's benefit; or

(2)  to redeliver the collateral to the secured party.

(i)  A secured party does not relinquish possession, even if a delivery under subsection (h) of this section violates the rights of a debtor.  A person to which collateral is delivered under subsection (h) of this section does not owe any duty to the secured party and is not required to confirm the delivery to another person unless the person otherwise agrees or law other than this article otherwise provides.

Added by Laws 2000, c. 371, § 33, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 66, eff. Jan. 1, 2006.

§12A-1-9-314.  Perfection by control.

PERFECTION BY CONTROL

(a)  A security interest in investment property, deposit accounts, letter-of-credit rights, electronic chattel paper, or electronic documents may be perfected by control of the collateral under Section 7-106, 19104, 19105, 19106, or 19107 of this title.

(b)  A security interest in deposit accounts, electronic chattel paper, letter-of-credit rights, or electronic documents is perfected by control under Section 19104, 19105, or 19107 of this title when the secured party obtains control and remains perfected by control only while the secured party retains control.

(c)  A security interest in investment property is perfected by control under Section 19106 of this title from the time the secured party obtains control and remains perfected by control until:

(1)  the secured party does not have control; and

(2)  one of the following occurs:

(A) if the collateral is a certificated security, the debtor has or acquires possession of the security certificate;

(B) if the collateral is an uncertificated security, the issuer has registered or registers the debtor as the registered owner; or

(C) if the collateral is a security entitlement, the debtor is or becomes the entitlement holder.

Added by Laws 2000, c. 371, § 34, eff. July 1, 2001.  Amended by Laws 2005, c. 140, § 67, eff. Jan. 1, 2006.

§12A-1-9-315.  Secured party's rights on disposition of collateral and in proceeds.

SECURED PARTY'S RIGHTS ON DISPOSITION

OF COLLATERAL AND IN PROCEEDS

(a)  Except as otherwise provided in this article and in paragraph (2) of Section 2403 of this title:

(1)  a security interest or agricultural lien continues in collateral notwithstanding sale, lease, license, exchange, or other disposition thereof unless the secured party authorized the disposition free of the security interest or agricultural lien; and

(2)  a security interest attaches to any identifiable proceeds of collateral.

(b)  Proceeds that are commingled with other property are identifiable proceeds:

(1)  if the proceeds are goods, to the extent provided by Section 19336 of this title; and

(2)  if the proceeds are not goods, to the extent that the secured party identifies the proceeds by a method of tracing, including application of equitable principles, that is permitted under law other than this article with respect to commingled property of the type involved.

(c)  A security interest in proceeds is a perfected security interest if the security interest in the original collateral was perfected.

(d)  A perfected security interest in proceeds becomes unperfected on the twenty-first day after the security interest attaches to the proceeds unless:

(1)  the following conditions are satisfied:

(A) a filed financing statement covers the original collateral;

(B) the proceeds are collateral in which a security interest may be perfected by filing in the office in which the financing statement has been filed; and

(C) the proceeds are not acquired with cash proceeds;

(2)  the proceeds are identifiable cash proceeds; or

(3)  the security interest in the proceeds is perfected other than under subsection (c) of this section when the security interest attaches to the proceeds or within twenty (20) days thereafter.

(e)  If a filed financing statement covers the original collateral, a security interest in proceeds which remains perfected under paragraph (1) of subsection (d) of this section becomes unperfected at the later of:

(1)  when the effectiveness of the filed financing statement lapses under Section 19515 of this title or is terminated under Section 19513 of this title; or

(2)  the twenty-first day after the security interest attaches to the proceeds.

Added by Laws 2000, c. 371, § 35, eff. July 1, 2001.