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369.116 Transferable records.
(1)
(2)
(3)
(4)
(5)
(6)
In this section, "transferable record" means an electronic record that:
(a) Would be a note under Article 3 of KRS Chapter 355 or a document under
Article 7 of KRS Chapter 355 if the electronic record were in writing; and
(b) The issuer of the electronic record expressly has agreed is a transferable
record.
A person has control of a transferable record if a system employed for evidencing
the transfer of interests in the transferable record reliably establishes that person as
the person to which the transferable record was issued or transferred.
A system satisfies subsection (2) of this section, and a person is deemed to have
control of a transferable record, if the transferable record is created, stored, and
assigned in such a manner that:
(a) A single authoritative copy of the transferable record exists which is unique,
identifiable, and, except as otherwise provided in paragraphs (d), (e), and (f)
of this subsection, unalterable;
(b) The authoritative copy identifies the person asserting control as:
1.
The person to which the transferable record was issued; or
2.
If the authoritative copy indicates that the transferable record has been
transferred, the person to which the transferable record was most
recently transferred;
(c) The authoritative copy is communicated to and maintained by the person
asserting control or its designated custodian;
(d) Copies of revisions that add or change an identified assignee of the
authoritative copy can be made only with the consent of the person asserting
control;
(e) 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
(f) Any revision of the authoritative copy is readily identifiable as authorized or
unauthorized.
Except as otherwise agreed, a person having control of a transferable record is the
holder, as defined in KRS 355.1-201(20), of the transferable record and has the
same rights and defenses as a holder of an equivalent record or writing under KRS
Chapter 355, including, if the applicable statutory requirements under KRS 355.3302(1), 355.7-501, or 355.9-330 are satisfied, the rights and defenses of a holder in
due course, a holder to which a negotiable document of title has been duly
negotiated, or a purchaser, respectively. Delivery, possession, and indorsement are
not required to obtain or exercise any of the rights under this subsection.
Except as otherwise agreed, an obligor under a transferable record has the same
rights and defenses as an equivalent obligor under equivalent records or writing
under KRS Chapter 355.
If requested by a person against which enforcement is sought, the person seeking to
enforce the transferable record shall provide reasonable proof that the person is in
control of the transferable record. Proof may include access to the authoritative copy
of the transferable record and related business records sufficient to review the terms
of the transferable record and to establish the identity of the person having control
of the transferable record.
Effective: July 1, 2001
History: Amended 2000 Ky. Acts ch. 301, sec. 23, effective July 1 2001. -- Created
2000 Ky. Acts ch. 301, sec. 16, effective August 1, 2000.
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