88R6131 SRA-F     By: Capriglione H.B. No. 5011       A BILL TO BE ENTITLED   AN ACT   relating to amendments to the Uniform Commercial Code, including   amendments concerning certain intangible assets and the perfection   of security interests in those assets.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:   ARTICLE 1. GENERAL PROVISIONS          SECTION 1.01.  Section 1.201(b), Business & Commerce Code,   is amended by amending Subdivisions (10), (15), (21), (24), (27),   (33), (36), and (37) and adding Subdivision (16-a) to read as   follows:                (10)  "Conspicuous," with reference to a term, means so   written, displayed, or presented that, based on the totality of the   circumstances, a reasonable person against which it is to operate   ought to have noticed it. Whether a term is "conspicuous" or not is   a decision for the court. [Conspicuous terms include the   following:                      [(A)  a heading in capitals equal to or greater in   size than the surrounding text, or in contrasting type, font, or   color to the surrounding text of the same or lesser size; and                      [(B)  language in the body of a record or display   in larger type than the surrounding text, or in contrasting type,   font, or color to the surrounding text of the same size, or set off   from surrounding text of the same size by symbols or other marks   that call attention to the language.]                (15)  "Delivery," with respect to an electronic   document of title, means voluntary transfer of control, and with   respect to an instrument, a tangible document of title, or an   authoritative tangible copy of a record evidencing chattel paper,   means voluntary transfer of possession.                (16-a)  "Electronic" means relating to technology   having electrical, digital, magnetic, wireless, optical,   electromagnetic, or similar capabilities.                (21)  "Holder" means:                      (A)  the person in possession of a negotiable   instrument that is payable either to bearer or to an identified   person that is the person in possession;                      (B)  the person in possession of a negotiable   tangible document of title if the goods are deliverable either to   bearer or to the order of the person in possession; or                      (C)  a person in control, other than pursuant to   Section 7.106(g), of a negotiable electronic document of title.                (24)  "Money" means a medium of exchange that is   currently authorized or adopted by a domestic or foreign   government. The term includes a monetary unit of account   established by an intergovernmental organization, or pursuant to an   [by] agreement between two or more countries. The term does not   include an electronic record that is a medium of exchange recorded   and transferable in a system that existed and operated for the   medium of exchange before the medium of exchange was authorized or   adopted by the government.                (27)  "Person" means an individual, corporation,   business trust, estate, trust, partnership, limited liability   company, association, joint venture, government, governmental   subdivision, agency, or instrumentality, or [public corporation,]   any other legal or commercial entity[, or a protected series or   registered series of a for-profit entity]. The term includes a   protected series or registered series, however denominated, of an   entity if the protected series or registered series is established   under law other than this title that limits, or limits if conditions   specified under the law are satisfied, the ability of a creditor of   the entity or of any other protected series or registered series of   the entity to satisfy a claim from assets of the protected series or   registered series.                (33)  "Representative" means a person empowered to act   for another, including an agent, an officer of an organization [a   corporation or association], and a trustee, executor, or   administrator of an estate.                (36)  "Send," in connection with a [writing,] record[,]   or notification, [notice] means:                      (A)  to deposit in the mail, [or] deliver for   transmission, or transmit by any other usual means of   communication, with postage or cost of transmission provided for,   [and properly] addressed [and, in the case of an instrument, to an   address specified thereon or otherwise agreed, or if there be none]   to any address reasonable under the circumstances; or                      (B)  to [in any other way] cause the record or   notification to be received [any record or notice] within the time   [at which] it would have been received [arrived] if properly sent   under Paragraph (A).                (37)  "Sign" means, with present intent to authenticate   or adopt a record:                      (A)  execute or adopt a tangible symbol; or                      (B)  attach to or logically associate with the   record an electronic symbol, sound, or process.   "Signed," "signing," and "signature" have corresponding meanings   [includes using any symbol executed or adopted with present   intention to adopt or accept a writing].          SECTION 1.02.  Section 1.204, Business & Commerce Code, is   amended to read as follows:          Sec. 1.204.  VALUE. Except as otherwise provided in   Chapters 3, 4, [and] 5, and 12A, a person gives value for rights if   the person acquires them:                (1)  in return for a binding commitment to extend   credit or for the extension of immediately available credit,   whether or not drawn upon and whether or not a charge-back is   provided for in the event of difficulties in collection;                (2)  as security for, or in total or partial   satisfaction of, a preexisting claim;                (3)  by accepting delivery under a preexisting contract   for purchase; or                (4)  in return for any consideration sufficient to   support a simple contract.          SECTION 1.03.  Section 1.301(b), Business & Commerce Code,   is amended to read as follows:          (b)  Where one of the following provisions of this title   specifies the applicable law, that provision governs and a contrary   agreement is effective only to the extent permitted by the law   (including the conflict of laws rules) so specified:          Rights of creditors against sold goods. Section 2.402.          Applicability of the chapter on Leases. Sections 2A.105 and   2A.106.          Applicability of the chapter on Bank Deposits and   Collections. Section 4.102.          Governing law in the chapter on Funds Transfers. Section   4A.507.          Letters of Credit. Section 5.116.          Applicability of the chapter on Investment Securities.   Section 8.110.          Law governing perfection, the effect of perfection or   nonperfection, and the priority of security interests and   agricultural liens. Sections 9.301-9.307.          Controllable electronic record. Section 12A.107.          SECTION 1.04.  Section 1.306, Business & Commerce Code, is   amended to read as follows:          Sec. 1.306.  WAIVER OF RENUNCIATION OF CLAIM OR RIGHT AFTER   BREACH. A claim or right arising out of an alleged breach may be   discharged in whole or in part without consideration by agreement   of the aggrieved party in a signed [an authenticated] record.   ARTICLE 2. SALES          SECTION 2.01.  Section 2.102, Business & Commerce Code, is   amended to read as follows:          Sec. 2.102.  SCOPE; CERTAIN SECURITY AND OTHER TRANSACTIONS   EXCLUDED FROM THIS CHAPTER. (a)  Unless the context otherwise   requires, and except as provided in Subsection (c), this chapter   applies to transactions in goods and, in the case of a hybrid   transaction, it applies to the extent provided in Subsection (b).          (b)  In a hybrid transaction:                (1)  if the sale-of-goods aspects do not predominate,   only the provisions of this chapter which relate primarily to the   sale-of-goods aspects of the transaction apply, and the provisions   that relate primarily to the transaction as a whole do not apply; or                (2)  if the sale-of-goods aspects predominate, this   chapter applies to the transaction but does not preclude   application in appropriate circumstances of other law to aspects of   the transaction which do not relate to the sale of goods.          (c)  This chapter [; it] does not:                (1)  apply to a [any] transaction that, even though   [which although] in the form of an unconditional contract to sell or   present sale, operates only to create a security interest; or                (2)  [is intended to operate only as a security   transaction nor does this chapter] impair or repeal any statute   regulating sales to consumers, farmers, or other specified classes   of buyers.          SECTION 2.02.  The heading to Section 2.106, Business &   Commerce Code, is amended to read as follows:          Sec. 2.106.  DEFINITIONS: "CONTRACT"; "AGREEMENT";   "CONTRACT FOR SALE"; "SALE"; "PRESENT SALE"; "CONFORMING" TO   CONTRACT; "TERMINATION"; "CANCELLATION"; "HYBRID TRANSACTION".          SECTION 2.03.  Section 2.106, Business & Commerce Code, is   amended by adding Subsection (e) to read as follows:          (e)  "Hybrid transaction" means a single transaction   involving a sale of goods and:                (1)  the provision of services;                (2)  a lease of other goods; or                (3)  a sale, lease, or license of property other than   goods.          SECTION 2.04.  Sections 2.201(a) and (b), Business &   Commerce Code, are amended to read as follows:          (a)  Except as otherwise provided in this section a contract   for the sale of goods for the price of $500 or more is not   enforceable by way of action or defense unless there is a record   [some writing] sufficient to indicate that a contract for sale has   been made between the parties and signed by the party against whom   enforcement is sought or by the party's [his] authorized agent or   broker. A record [writing] is not insufficient because it omits or   incorrectly states a term agreed upon but the contract is not   enforceable under this subsection [paragraph] beyond the quantity   of goods shown in the record [such writing].          (b)  Between merchants if within a reasonable time a record   [writing] in confirmation of the contract and sufficient against   the sender is received and the party receiving it has reason to know   its contents, it satisfies the requirements of Subsection (a)   against the [such] party unless [written] notice in a record of   objection to its contents is given within ten days after it is   received.          SECTION 2.05.  Section 2.202, Business & Commerce Code, is   amended to read as follows:          Sec. 2.202.  FINAL [WRITTEN] EXPRESSION: PAROL OR EXTRINSIC   EVIDENCE. Terms with respect to which the confirmatory memoranda   of the parties agree or which are otherwise set forth in a record   [writing] intended by the parties as a final expression of their   agreement with respect to such terms as are included therein may not   be contradicted by evidence of any prior agreement or of a   contemporaneous oral agreement but may be explained or   supplemented:                (1)  by course of performance, course of dealing, or   usage of trade (Section 1.303); and                (2)  by evidence of consistent additional terms unless   the court finds the record [writing] to have been intended also as a   complete and exclusive statement of the terms of the agreement.          SECTION 2.06.  Section 2.203, Business & Commerce Code, is   amended to read as follows:          Sec. 2.203.  SEALS INOPERATIVE. The affixing of a seal to a   record [writing] evidencing a contract for sale or an offer to buy   or sell goods does not constitute the record [writing] a sealed   instrument and the law with respect to sealed instruments does not   apply to such a contract or offer.          SECTION 2.07.  Section 2.205, Business & Commerce Code, is   amended to read as follows:          Sec. 2.205.  FIRM OFFERS. An offer by a merchant to buy or   sell goods in a signed record [writing] which by its terms gives   assurance that it will be held open is not revocable, for lack of   consideration, during the time stated or if no time is stated for a   reasonable time, but in no event may such period of irrevocability   exceed three months; but any such term of assurance on a form   supplied by the offeree must be separately signed by the offeror.          SECTION 2.08.  Section 2.209(b), Business & Commerce Code,   is amended to read as follows:          (b)  A signed agreement which excludes modification or   rescission except by a signed writing or other signed record cannot   be otherwise modified or rescinded, but except as between merchants   such a requirement on a form supplied by the merchant must be   separately signed by the other party.   ARTICLE 3. LEASES          SECTION 3.01.  Section 2A.102, Business & Commerce Code, is   amended to read as follows:          Sec. 2A.102.  SCOPE. (a)  This chapter applies to any   transaction, regardless of form, that creates a lease of goods and,   in the case of a hybrid lease, it applies to the extent provided in   Subsection (b). This chapter does not apply to a transaction that   creates an interest in or lease of real estate, except to the extent   that provision is made for leases of fixtures by Section 2A.309.          (b)  In a hybrid lease:                (1)  if the lease-of-goods aspects do not predominate:                      (A)  only the provisions of this chapter which   relate primarily to the lease-of-goods aspects of the transaction   apply, and the provisions that relate primarily to the transaction   as a whole do not apply;                      (B)  Section 2A.209 applies if the lease is a   finance lease; and                      (C)  Section 2A.407 applies to the promises of the   lessee in a finance lease to the extent the promises are   consideration for the right to possession and use of the leased   goods; and                (2)  if the lease-of-goods aspects predominate, this   chapter applies to the transaction, but does not preclude   application in appropriate circumstances of other law to aspects of   the lease which do not relate to the lease of goods.          SECTION 3.02.  Section 2A.103(a), Business & Commerce Code,   is amended by adding Subdivision (8-a) to read as follows:                (8-a)  "Hybrid lease" means a single transaction   involving a lease of goods and:                      (A)  the provision of services;                      (B)  the sale of other goods; or                      (C)  subject to the second sentence of Section   2A.102(a), a sale, lease, or license of property other than goods.          SECTION 3.03.  Section 2A.107, Business & Commerce Code, is   amended to read as follows:          Sec. 2A.107.  WAIVER OR RENUNCIATION OF CLAIM OR RIGHT AFTER   DEFAULT. A claim or right arising out of an alleged default or   breach of warranty may be discharged in whole or in part without   consideration by a [written] waiver or renunciation in a signed   record [and] delivered by the aggrieved party.          SECTION 3.04.  Sections 2A.201(a), (c), and (e), Business &   Commerce Code, are amended to read as follows:          (a)  A lease contract is not enforceable by way of action or   defense unless:                (1)  the total payments to be made under the lease   contract, excluding payments for options to renew or buy, are less   than $1,000; or                (2)  there is a record [writing], signed by the party   against whom enforcement is sought or by that party's authorized   agent, sufficient to indicate that a lease contract has been made   between the parties and to describe the goods leased and the lease   term.          (c)  A record [writing] is not insufficient because it omits   or incorrectly states a term agreed upon, but the lease contract is   not enforceable under Subsection (a)(2) beyond the lease term and   the quantity of goods shown in the record [writing].          (e)  The lease term under a lease contract referred to in   Subsection (d) is:                (1)  if there is a record [writing] signed by the party   against whom enforcement is sought or by that party's authorized   agent specifying the lease term, the term so specified;                (2)  if the party against whom enforcement is sought   admits in that party's pleading, testimony, or otherwise in court a   lease term, the term so admitted; or                (3)  a reasonable lease term.          SECTION 3.05.  Section 2A.202, Business & Commerce Code, is   amended to read as follows:          Sec. 2A.202.  FINAL [WRITTEN] EXPRESSION; PAROL OR   EXTRINSIC EVIDENCE. Terms with respect to which the confirmatory   memoranda of the parties agree or which are otherwise set forth in a   record [writing] intended by the parties as a final expression of   their agreement with respect to such terms as are included therein   may not be contradicted by evidence of a prior agreement or of a   contemporaneous oral agreement but may be explained or   supplemented:                (1)  by course of dealing or usage of trade or by course   of performance; and                (2)  by evidence of consistent additional terms unless   the court finds the record [writing] to have been intended also as a   complete and exclusive statement of the terms of the agreement.          SECTION 3.06.  Section 2A.203, Business & Commerce Code, is   amended to read as follows:          Sec. 2A.203.  SEALS INOPERATIVE. The affixing of a seal to a   record [writing] evidencing a lease contract or an offer to enter   into a lease contract does not render the record [writing] a sealed   instrument and the law with respect to sealed instruments does not   apply to the lease contract or offer.          SECTION 3.07.  Section 2A.205, Business & Commerce Code, is   amended to read as follows:          Sec. 2A.205.  FIRM OFFERS. An offer by a merchant to lease   goods to or from another person in a signed record [writing] that by   its terms gives assurance it will be held open is not revocable, for   lack of consideration, during the time stated or, if no time is   stated, for a reasonable time, but in no event may the period of   irrevocability exceed three months. Any such term of assurance on a   form supplied by the offeree must be separately signed by the   offeror.          SECTION 3.08.  The heading of Section 2A.208, Business &   Commerce Code, is amended to read as follows:          Sec. 2A.208.  MODIFICATION, RESCISSION, AND WAIVER.          SECTION 3.09.  Section 2A.208(b), Business & Commerce Code,   is amended to read as follows:          (b)  A signed lease agreement that excludes modification or   rescission except by a signed record [writing] may not be otherwise   modified or rescinded, but, except as between merchants, such a   requirement on a form supplied by a merchant must be separately   signed by the other party.   ARTICLE 4. NEGOTIABLE INSTRUMENTS          SECTION 4.01.  Section 3.104(a), Business & Commerce Code,   is amended to read as follows:          (a)  Except as provided in Subsections (c) and (d),   "negotiable instrument" means an unconditional promise or order to   pay a fixed amount of money, with or without interest or other   charges described in the promise or order, if it:                (1)  is payable to bearer or to order at the time it is   issued or first comes into possession of a holder;                (2)  is payable on demand or at a definite time; and                (3)  does not state any other undertaking or   instruction by the person promising or ordering payment to do any   act in addition to the payment of money, but the promise or order   may contain:                      (A)  an undertaking or power to give, maintain, or   protect collateral to secure payment;                      (B)  an authorization or power to the holder to   confess judgment or realize on or dispose of collateral; [or]                      (C)  a waiver of the benefit of any law intended   for the advantage or protection of an obligor;                      (D)  a term that specifies the law that governs   the promise or order; or                      (E)  an undertaking to resolve in a specified   forum a dispute concerning the promise or order.          SECTION 4.02.  Section 3.105(a), Business & Commerce Code,   is amended to read as follows:          (a)  "Issue" means:                (1)  the first delivery of an instrument by the maker or   drawer, whether to a holder or nonholder, for the purpose of giving   rights on the instrument to any person; or                (2)  if agreed by the payee, the first transmission by   the drawer to the payee of an image of an item and information   derived from the item that enables the depositary bank to collect   the item by transferring or presenting under federal law an   electronic check.          SECTION 4.03.  Section 3.401, Business & Commerce Code, is   amended to read as follows:          Sec. 3.401.  SIGNATURE NECESSARY FOR LIABILITY ON   INSTRUMENT. [(a)]  A person is not liable on an instrument unless   the person:                (1)  signed the instrument; or                (2)  is represented by an agent or representative who   signed the instrument and the signature is binding on the   represented person under Section 3.402.          [(b)  A signature may be made (i) manually or by means of a   device or machine, and (ii) by the use of any name, including a   trade or assumed name, or by a word, mark, or symbol executed or   adopted by a person with present intention to authenticate a   writing.]          SECTION 4.04.  Section 3.604, Business & Commerce Code, is   amended to read as follows:          Sec. 3.604.  DISCHARGE BY CANCELLATION OR RENUNCIATION. (a)   A person entitled to enforce an instrument, with or without   consideration, may discharge the obligation of a party to pay the   instrument:                (1)  by an intentional voluntary act, such as surrender   of the instrument to the party, destruction, mutilation, or   cancellation of the instrument, cancellation or striking out of the   party's signature, or the addition of words to the instrument   indicating discharge; or                (2)  by agreeing not to sue or otherwise renouncing   rights against the party by a signed record.          (b)  The obligation of a party to pay a check is not   discharged solely by destruction of the check in connection with a   process in which information is extracted from the check and an   image of the check is made and, subsequently, the information and   image are transmitted for payment.          (c)  Cancellation or striking out of an indorsement pursuant   to Subsection (a) does not affect the status and rights of a party   derived from the indorsement.          [(c)  In this section, "signed," with respect to a record   that is not a writing, includes the attachment to or logical   association with the record of an electronic symbol, sound, or   process with the present intent to adopt or accept the record.]   ARTICLE 5. FUNDS TRANSFERS          SECTION 5.01.  Section 4A.103(a)(1), Business & Commerce   Code, is amended to read as follows:                (1)  "Payment order" means an instruction of a sender   to a receiving bank, transmitted orally or in a record,   [electronically, or in writing,] to pay, or to cause another bank to   pay, a fixed or determinable amount of money to a beneficiary if:                      (A)  the instruction does not state a condition of   payment to the beneficiary other than the time of payment;                      (B)  the receiving bank is to be reimbursed by   debiting an account of, or otherwise receiving payment from, the   sender; and                      (C)  the instruction is transmitted by the sender   directly to the receiving bank or to an agent, funds transfer   system, or communication system for transmittal to the receiving   bank.          SECTION 5.02.  Section 4A.201, Business & Commerce Code, is   amended to read as follows:          Sec. 4A.201.  SECURITY PROCEDURE. "Security procedure"   means a procedure established by an agreement between a customer   and a receiving bank for the purpose of (i) verifying that a payment   order or communication amending or cancelling a payment order is   that of the customer, or (ii) detecting error in the transmission or   the content of the payment order or communication. A security   procedure may impose an obligation on the receiving bank or the   customer and may require the use of algorithms or other codes,   identifying words, [or] numbers, symbols, sounds, biometrics,   encryption, callback procedures, or similar security devices.   Comparison of a signature on a payment order or communication with   an authorized specimen signature of the customer or requiring a   payment order to be sent from a known e-mail address, IP address, or   telephone number is not by itself a security procedure.          SECTION 5.03.  Sections 4A.202(b) and (c), Business &   Commerce Code, are amended to read as follows:          (b)  If a bank and its customer have agreed that the   authenticity of payment orders issued to the bank in the name of the   customer as sender will be verified pursuant to a security   procedure, a payment order received by the receiving bank is   effective as the order of the customer, whether or not authorized,   if (i) the security procedure is a commercially reasonable method   of providing security against unauthorized payment orders, and (ii)   the bank proves that it accepted the payment order in good faith and   in compliance with the bank's obligations under the security   procedure and any [written] agreement or instruction of the   customer, evidenced by a record, restricting acceptance of payment   orders issued in the name of the customer. The bank is not required   to follow an instruction that violates an [a written] agreement   with the customer evidenced by a record, or notice of which is not   received at a time and in a manner affording the bank a reasonable   opportunity to act on it before the payment order is accepted.          (c)  Commercial reasonableness of a security procedure is a   question of law to be determined by considering the wishes of the   customer expressed to the bank, the circumstances of the customer   known to the bank, including the size, type, and frequency of   payment orders normally issued by the customer to the bank,   alternative security procedures offered to the customer, and   security procedures in general use by customers and receiving banks   similarly situated. A security procedure is deemed to be   commercially reasonable if:                (1)  the security procedure was chosen by the customer   after the bank offered, and the customer refused, a security   procedure that was commercially reasonable for the customer; and                (2)  the customer expressly agreed in a record   [writing] to be bound by any payment order, whether or not   authorized, issued in its name and accepted by the bank in   compliance with the bank's obligations under the security procedure   chosen by the customer.          SECTION 5.04.  Section 4A.203(a), Business & Commerce Code,   is amended to read as follows:          (a)  If an accepted payment order is not, under Section   4A.202(a), an authorized order of a customer identified as sender,   but is effective as an order of the customer pursuant to Section   4A.202(b), the following rules apply:                (1)  By express [written] agreement evidenced by a   record, the receiving bank may limit the extent to which it is   entitled to enforce or retain payment of the payment order.                (2)  The receiving bank is not entitled to enforce or   retain payment of the payment order if the customer proves that the   order was not caused, directly or indirectly, by a person:                      (A)  entrusted at any time with duties to act for   the customer with respect to payment orders or the security   procedure; or                      (B)  who obtained access to transmitting   facilities of the customer or who obtained, from a source   controlled by the customer and without authority of the receiving   bank, information facilitating breach of the security procedure,   regardless of how the information was obtained or whether the   customer was at fault. Information includes any access device,   computer software, or the like.          SECTION 5.05.  Section 4A.207(c), Business & Commerce Code,   is amended to read as follows:          (c)  If (i) a payment order described in Subsection (b) is   accepted, (ii) the originator's payment order described the   beneficiary inconsistently by name and number, and (iii) the   beneficiary's bank pays the person identified by number as   permitted by Subsection (b)(1), the following rules apply:                (1)  If the originator is a bank, the originator is   obliged to pay its order.                (2)  If the originator is not a bank and proves that the   person identified by number was not entitled to receive payment   from the originator, the originator is not obliged to pay its order   unless the originator's bank proves that the originator, before   acceptance of the originator's order, had notice that payment of a   payment order issued by the originator might be made by the   beneficiary's bank on the basis of an identifying or bank account   number even if it identifies a person different from the named   beneficiary. Proof of notice may be made by any admissible   evidence. The originator's bank satisfies the burden of proof if it   proves that the originator, before the payment order was accepted,   signed a record [writing] stating the information to which the   notice relates.          SECTION 5.06.  Section 4A.208(b), Business & Commerce Code,   is amended to read as follows:          (b)  This subsection applies to a payment order identifying   an intermediary bank or the beneficiary's bank both by name and an   identifying number if the name and number identify different   persons.                (1)  If the sender is a bank, the receiving bank may   rely on the number as the proper identification of the intermediary   or beneficiary's bank if the receiving bank, when it executes the   sender's order, does not know that the name and number identify   different persons. The receiving bank need not determine whether   the name and number refer to the same person or whether the number   refers to a bank. The sender is obliged to compensate the receiving   bank for any loss and expenses incurred by the receiving bank as a   result of its reliance on the number in executing or attempting to   execute the order.                (2)  If the sender is not a bank and the receiving bank   proves that the sender, before the payment order was accepted, had   notice that the receiving bank might rely on the number as the   proper identification of the intermediary or beneficiary's bank   even if it identifies a person different from the bank identified by   name, the rights and obligations of the sender and the receiving   bank are governed by Subsection (b)(1), as though the sender were a   bank. Proof of notice may be made by any admissible evidence. The   receiving bank satisfies the burden of proof if it proves that the   sender, before the payment order was accepted, signed a record   [writing] stating the information to which the notice relates.                (3)  Regardless of whether the sender is a bank, the   receiving bank may rely on the name as the proper identification of   the intermediary or beneficiary's bank if the receiving bank, at   the time it executes the sender's order, does not know that the name   and number identify different persons. The receiving bank need not   determine whether the name and number refer to the same person.                (4)  If the receiving bank knows that the name and   number identify different persons, reliance on either the name or   the number in executing the sender's payment order is a breach of   the obligation stated in Section 4A.302(a)(1).          SECTION 5.07.  Section 4A.210(a), Business & Commerce Code,   is amended to read as follows:          (a)  A payment order is rejected by the receiving bank by a   notice of rejection transmitted to the sender orally[,   electronically,] or in a record [writing]. A notice of rejection   need not use any particular words and is sufficient if it indicates   that the receiving bank is rejecting the order or will not execute   or pay the order. Rejection is effective when the notice is given   if transmission is by a means that is reasonable under the   circumstances. If notice of rejection is given by a means that is   not reasonable, rejection is effective when the notice is received.   If an agreement of the sender and receiving bank establishes the   means to be used to reject a payment order:                (1)  any means complying with the agreement is   reasonable; and                (2)  any means not complying is not reasonable unless   no significant delay in receipt of the notice resulted from the use   of the noncomplying means.          SECTION 5.08.  Section 4A.211(a), Business & Commerce Code,   is amended to read as follows:          (a)  A communication of the sender of a payment order   cancelling or amending the order may be transmitted to the   receiving bank orally[, electronically,] or in a record [writing].   If a security procedure is in effect between the sender and the   receiving bank, the communication is not effective to cancel or   amend the order unless the communication is verified pursuant to   the security procedure or the bank agrees to the cancellation or   amendment.          SECTION 5.09.  Sections 4A.305(c) and (d), Business &   Commerce Code, are amended to read as follows:          (c)  In addition to the amounts payable under Subsections (a)   and (b), damages, including consequential damages, are recoverable   to the extent provided in an express [written] agreement of the   receiving bank, evidenced by a record.          (d)  If a receiving bank fails to execute a payment order it   was obliged by express agreement to execute, the receiving bank is   liable to the sender for its expenses in the transaction and for   incidental expenses and interest losses resulting from the failure   to execute. Additional damages, including consequential damages,   are recoverable to the extent provided in an express [written]   agreement of the receiving bank, evidenced by a record, but are not   otherwise recoverable.   ARTICLE 6. LETTERS OF CREDIT          SECTION 6.01.  Section 5.104, Business & Commerce Code, is   amended to read as follows:          Sec. 5.104.  FORMAL REQUIREMENTS. A letter of credit,   confirmation, advice, transfer, amendment, or cancellation may be   issued in any form that is a signed record [and is authenticated:                [(1)  by a signature; or                [(2)  in accordance with the agreement of the parties   or the standard practice referred to in Section 5.108(e)].          SECTION 6.02.  Section 5.116, Business & Commerce Code, is   amended to read as follows:          Sec. 5.116.  CHOICE OF LAW AND FORUM. (a)  The liability of   an issuer, nominated person, or adviser for action or omission is   governed by the law of the jurisdiction chosen by an agreement in   the form of a record signed [or otherwise authenticated] by the   affected parties [in the manner provided in Section 5.104] or by a   provision in the person's letter of credit, confirmation, or other   undertaking. The jurisdiction whose law is chosen need not bear any   relation to the transaction.          (b)  Unless Subsection (a) applies, the liability of an   issuer, nominated person, or adviser for action or omission is   governed by the law of the jurisdiction in which the person is   located. The person is considered to be located at the address   indicated in the person's undertaking. If more than one address is   indicated, the person is considered to be located at the address   from which the person's undertaking was issued.          (c)  For the purpose of jurisdiction, choice of law, and   recognition of interbranch letters of credit, but not enforcement   of a judgment, all branches of a bank are considered separate   juridical entities, and a bank is considered to be located at the   place where its relevant branch is considered to be located under   Subsection (d) [this subsection].          (d)  A branch of a bank is considered to be located at the   address indicated in the branch's undertaking. If more than one   address is indicated, the branch is considered to be located at the   address from which the undertaking was issued.          (e) [(c)]  Except as otherwise provided in this subsection,   the liability of an issuer, nominated person, or adviser is   governed by any rules of custom or practice, such as the Uniform   Customs and Practice for Documentary Credits, to which the letter   of credit, confirmation, or other undertaking is expressly made   subject. If (i) this chapter would govern the liability of an   issuer, nominated person, or adviser under Subsection (a) or (b),   (ii) the relevant undertaking incorporates rules of custom or   practice, and (iii) there is conflict between this chapter and   those rules as applied to that undertaking, those rules govern   except to the extent of any conflict with the nonvariable   provisions specified in Section 5.103(c).          (f) [(d)]  If there is conflict between this chapter and   Chapter 3, 4, 4A, or 9, this chapter governs.          (g) [(e)]  The forum for settling disputes arising out of an   undertaking within this chapter may be chosen in the manner and with   the binding effect that governing law may be chosen in accordance   with Subsection (a).   ARTICLE 7. DOCUMENTS OF TITLE          SECTION 7.01.  Section 7.106, Business & Commerce Code, is   amended by amending Subsection (b) and adding Subsections (c), (d),   (e), (f), (g), (h), and (i) to read as follows:          (b)  A system satisfies Subsection (a), and a person has [is   deemed to have] control of an electronic document of title, if the   document is created, stored, and transferred [assigned] in [such] a   manner that:                (1)  a single authoritative copy of the document exists   which is unique, identifiable, and, except as otherwise provided in   Subdivisions (4), (5), and (6), unalterable;                (2)  the authoritative copy identifies the person   asserting control as:                      (A)  the person to which the document was issued;   or                      (B)  if the authoritative copy indicates that the   document has been transferred, the person to which the document was   most recently transferred;                (3)  the authoritative copy is communicated to and   maintained by the person asserting control or its designated   custodian;                (4)  copies or amendments that add or change an   identified transferee [assignee] of the authoritative copy can be   made only with the consent of the person asserting control;                (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 amendment of the authoritative copy is readily   identifiable as authorized or unauthorized.          (c)  A system satisfies Subsection (a), and a person has   control of an electronic document of title, if an authoritative   electronic copy of the document, a record attached to or logically   associated with the electronic copy, or a system in which the   electronic copy is recorded:                (1)  enables the person readily to identify each   electronic copy as either an authoritative copy or a   nonauthoritative copy;                (2)  enables the person readily to identify itself in   any way, including by name, identifying number, cryptographic key,   office, or account number, as the person to which each   authoritative electronic copy was issued or transferred; and                (3)  gives the person exclusive power, subject to   Subsection (d), to:                      (A)  prevent others from adding or changing the   person to which each authoritative electronic copy has been issued   or transferred; and                      (B)  transfer control of each authoritative   electronic copy.          (d)  Subject to Subsection (e), a power is exclusive under   Subsections (c)(3)(A) and (B), even if:                (1)  the authoritative electronic copy, a record   attached to or logically associated with the authoritative   electronic copy, or a system in which the authoritative electronic   copy is recorded limits the use of the document of title or has a   protocol that is programmed to cause a change, including a transfer   or loss of control; or                (2)  the power is shared with another person.          (e)  A power of a person is not shared with another person   under Subsection (d)(2) and the person's power is not exclusive if:                (1)  the person can exercise the power only if the power   also is exercised by the other person; and                (2)  the other person:                      (A)  can exercise the power without exercise of   the power by the person; or                      (B)  is the transferor to the person of an   interest in the document of title.          (f)  If a person has the powers specified in Subsections   (c)(3)(A) and (B), the powers are presumed to be exclusive.          (g)  A person has control of an electronic document of title   if another person, other than the transferor to the person of an   interest in the document:                (1)  has control of the document and acknowledges that   it has control on behalf of the person; or                (2)  obtains control of the document after having   acknowledged that it will obtain control of the document on behalf   of the person.          (h)  A person that has control under this section is not   required to acknowledge that it has control on behalf of another   person.          (i)  If a person acknowledges that it has or will obtain   control on behalf of another person, unless the person otherwise   agrees or law other than this chapter or Chapter 9 otherwise   provides, the person does not owe any duty to the other person and   is not required to confirm the acknowledgment to any other person.   ARTICLE 8. INVESTMENT SECURITIES          SECTION 8.01.  Section 8.102(a)(6), Business & Commerce   Code, is amended to read as follows:                (6)  "Communicate" means to:                      (A)  send a signed record [writing]; or                      (B)  transmit information by any mechanism agreed   on by the persons transmitting and receiving the information.          SECTION 8.02.  Section 8.102(b), Business & Commerce Code,   is amended to read as follows:          (b)  The following [Other] definitions in [applying to] this   chapter and other chapters apply to this chapter [the sections in   which they appear are]:   Appropriate person Section 8.107   Control Section 8.106   Controllable account Section 9.102   Controllable electronic record Section 12A.102   Controllable payment intangible Section 9.102   Delivery Section 8.301   Investment company security Section 8.103   Issuer Section 8.201   Overissue Section 8.210   Protected purchaser Section 8.303   Securities account Section 8.501          SECTION 8.03.  Section 8.103, Business & Commerce Code, is   amended by adding Subsection (h) to read as follows:          (h)  A controllable account, controllable electronic record,   or controllable payment intangible is not a financial asset unless   Section 8.102(a)(9)(C) applies.          SECTION 8.04.  Section 8.106, Business & Commerce Code, is   amended by amending Subsection (d) and adding Subsections (h) and   (i) to read as follows:          (d)  A purchaser has control of a security entitlement if:                (1)  the purchaser becomes the entitlement holder;                (2)  the securities intermediary has agreed that it   will comply with entitlement orders originated by the purchaser   without further consent by the entitlement holder; or                (3)  another person, other than the transferor to the   purchaser of an interest in the security entitlement:                      (A)  has control of the security entitlement and   [on behalf of the purchaser or, having previously acquired control   of the security entitlement,] acknowledges that it has control on   behalf of the purchaser; or                      (B)  obtains control of the security entitlement   after having acknowledged that it will obtain control of the   security entitlement on behalf of the purchaser.          (h)  A person that has control under this section is not   required to acknowledge that it has control on behalf of a   purchaser.          (i)  If a person acknowledges that it has or will obtain   control on behalf of a purchaser, unless the person otherwise   agrees or law other than this chapter or Chapter 9 otherwise   provides, the person does not owe any duty to the purchaser and is   not required to confirm the acknowledgment to any other person.          SECTION 8.05.  Section 8.110, Business & Commerce Code, is   amended by adding Subsection (g) to read as follows:          (g)  The local law of the issuer's jurisdiction or the   securities intermediary's jurisdiction governs a matter or   transaction specified in Subsection (a) or (b) even if the matter or   transaction does not bear any relation to the jurisdiction.          SECTION 8.06.  Section 8.303(b), Business & Commerce Code,   is amended to read as follows:          (b)  A [In addition to acquiring the rights of a purchaser,   a] protected purchaser [also] acquires its interest in the security   free of any adverse claim.   ARTICLE 9. SECURED TRANSACTIONS          SECTION 9.01.  Section 9.102(a), Business & Commerce Code,   is amended by amending Subdivisions (2), (3), (4), (11), (42),   (47), (62), and (67) and adding Subdivisions (7-a), (7-b), (27-a),   (27-b), (31-a), (54-a), and (79-a) to read as follows:                (2)  "Account," except as used in "account for,"   "account statement," "account to," the definition of "commodity   account" in Subdivision (14), "customer's account," the definition   of "deposit account" in Subdivision (29), "on account of," and   "statement of account," 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 person licensed or authorized to operate the game by a   state or governmental unit of a state. The term includes   controllable accounts and health-care-insurance receivables. The   term does not include (i) chattel paper [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, or (vii) rights to payment   evidenced by an instrument.                (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 negotiable instrument evidences [constitutes part of] chattel   paper.                (4)  "Accounting," except as used in "accounting for,"   means a record:                      (A)  signed [authenticated] by a secured party;                      (B)  indicating the aggregate unpaid secured   obligations as of a date not more than 35 days earlier or 35 days   later than the date of the record; and                      (C)  identifying the components of the   obligations in reasonable detail.                (7-a)  "Assignee," except as used in "assignee for   benefit of creditors," means a person (i) in whose favor a security   interest that secures an obligation is created or provided for   under a security agreement, whether or not the obligation is   outstanding or (ii) to which an account, chattel paper, payment   intangible, or promissory note has been sold. The term includes a   person to which a security interest has been transferred by a   secured party.                (7-b)  "Assignor" means a person that (i) under a   security agreement creates or provides for a security interest that   secures an obligation or (ii) sells an account, chattel paper,   payment intangible, or promissory note. The term includes a   secured party that has transferred a security interest to another   person.                (11)  "Chattel paper" means:                      (A)  a right to payment of a monetary obligation   secured by specific goods, if the right to payment and security   agreement are evidenced by a record; or                      (B)  a right to payment of a monetary obligation   owed by a lessee under a lease agreement with respect to specific   goods and a monetary obligation owed by the lessee in connection   with the transaction giving rise to the lease, if:                            (i)  the right to payment and lease   agreement are evidenced by a record; and                            (ii)  the predominant purpose of the   transaction giving rise to the lease was to give the lessee the   right to possession and use of the goods. The term does not include   a right to payment arising out of a charter or other contract   involving the use or hire of a vessel or 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 [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   subdivision, "monetary obligation" means a monetary obligation   secured by the goods or owed under a lease of the goods and includes   a monetary obligation with respect to software used in the goods.   The term does not include (i) charters or other contracts involving   the use or hire of a vessel or (ii) records 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. If a transaction   is evidenced by records that include an instrument or series of   instruments, the group of records taken together constitutes   chattel paper].                (27-a)  "Controllable account" means an account   evidenced by a controllable electronic record that provides that   the account debtor undertakes to pay the person that has control   under Section 12A.105 of the controllable electronic record.                (27-b)  "Controllable payment intangible" means a   payment intangible evidenced by a controllable electronic record   that provides that the account debtor undertakes to pay the person   that has control under Section 12A.105 of the controllable   electronic record.                (31-a)  "Electronic money" means money in an electronic   form.                (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 controllable electronic records,   payment intangibles, and software.                (47)  "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 indorsement or assignment. The term does not   include (i) investment property, (ii) letters of credit, (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, [or] (iv) nonnegotiable certificates of deposit, or (v)   writings that evidence chattel paper.                (54-a)  "Money" has the meaning in Section   1.201(b)(24), but does not include (i) a deposit account or (ii)   money in an electronic form that cannot be subjected to control   under Section 9.1051.                (62)  "Payment intangible" means a general intangible   under which the account debtor's principal obligation is a monetary   obligation. The term includes a controllable payment intangible.                (67)  "Proposal" means a record signed [authenticated]   by a secured party that 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   9.620, 9.621, and 9.622.                (79-a)  "Tangible money" means money in a tangible   form.          SECTION 9.02.  Section 9.102(b), Business & Commerce Code,   is amended to read as follows:          (b)  "Control" as provided in Section 7.106 and the [The]   following definitions in other chapters apply to this chapter:   "Applicant" Section 5.102.   "Beneficiary" Section 5.102.   "Broker" Section 8.102.   "Certificated security" Section 8.102.   "Check" Section 3.104.   "Clearing corporation" Section 8.102.   "Contract for sale" Section 2.106.   ["Control" (with respect to a ] [Section 7.106.]   [] [Section 7.106.]   "Controllable electronic record" Section 12A.102.   "Customer" Section 4.104.   "Entitlement holder" Section 8.102.   "Financial asset" Section 8.102.   "Holder in due course" Section 3.302.   "Issuer" (with respect to a letter of credit   "Issuer" (with respect to a letter of credit   or letter-of-credit right) Section 5.102.   "Issuer" (with respect to a security) Section 8.201.   "Issuer" (with respect to a security) Section 8.201.   "Lease" Section 2A.103.   "Lease agreement" Section 2A.103.   "Lease contract" Section 2A.103.   "Leasehold interest" Section 2A.103.   "Lessee" Section 2A.103.   "Lessee in ordinary course of business" Section 2A.103.   "Lessee in ordinary course of business" Section 2A.103.   "Lessor" Section 2A.103.   "Lessor's residual interest" Section 2A.103.   "Letter of credit" Section 5.102.   "Merchant" Section 2.104.   "Negotiable instrument" Section 3.104.   "Nominated person" Section 5.102.   "Note" Section 3.104.   "Proceeds of a letter of credit" Section 5.114.   "Protected purchaser" Section 8.303.   "Prove" Section 3.103.   "Qualifying purchaser" Section 12A.102.   "Sale" Section 2.106.   "Securities account" Section 8.501.   "Securities intermediary" Section 8.102.   "Security" Section 8.102.   "Security certificate" Section 8.102.   "Security entitlement" Section 8.102.   "Uncertificated security" Section 8.102.   ["Virtual currency"] [Section 12.001.]          SECTION 9.03.  Section 9.104(a), Business & Commerce Code,   is amended to read as follows:          (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   a signed [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; or                (4)  another person, other than the debtor:                      (A)  has control of the deposit account and   acknowledges that it has control on behalf of the secured party; or                      (B)  obtains control of the deposit account after   having acknowledged that it will obtain control of the deposit   account on behalf of the secured party.          SECTION 9.04.  Section 9.105, Business & Commerce Code, is   amended to read as follows:          Sec. 9.105.  CONTROL OF ELECTRONIC COPY OF RECORD EVIDENCING    CHATTEL PAPER. (a)  A purchaser [secured party] has control of an   authoritative electronic copy of a record evidencing chattel paper   if a system employed for evidencing the assignment [transfer] of   interests in the chattel paper reliably establishes the purchaser    [secured party] as the person to which the authoritative electronic   copy [chattel paper] was assigned.          (b)  A system satisfies Subsection (a)[, and a secured party   has control of electronic chattel paper,] if the record or records   evidencing [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 [that] is unique, identifiable, and, except as   otherwise provided in Subdivisions (4), (5), and (6), unalterable;                (2)  the authoritative copy identifies the purchaser    [secured party] as the assignee of the record or records;                (3)  the authoritative copy is communicated to and   maintained by the purchaser [secured party] or its designated   custodian;                (4)  copies or amendments that add or change an   identified assignee of the authoritative copy can be made only with   the consent of the purchaser [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 amendment of the authoritative copy is readily   identifiable as authorized or unauthorized.          (c)  A system satisfies Subsection (a), and a purchaser has   control of an authoritative electronic copy of a record evidencing   chattel paper, if the electronic copy, a record attached to or   logically associated with the electronic copy, or a system in which   the electronic copy is recorded:                (1)  enables the purchaser readily to identify each   electronic copy as an authoritative copy or a nonauthoritative   copy;                (2)  enables the purchaser readily to identify itself   in any way, including by name, identifying number, cryptographic   key, office, or account number, as the assignee of the   authoritative electronic copy; and                (3)  gives the purchaser exclusive power, subject to   Subsection (d), to:                      (A)  prevent others from adding or changing an   identified assignee of the authoritative electronic copy; and                      (B)  transfer control of the authoritative   electronic copy.          (d)  Subject to Subsection (e), a power is exclusive under   Subsections (c)(3)(A) and (B) even if:                (1)  the authoritative electronic copy, a record   attached to or logically associated with the authoritative   electronic copy, or a system in which the authoritative electronic   copy is recorded limits the use of the authoritative electronic   copy or has a protocol programmed to cause a change, including a   transfer or loss of control; or                (2)  the power is shared with another person.          (e)  A power of a purchaser is not shared with another person   under Subsection (d)(2) and the purchaser's power is not exclusive   if:                (1)  the purchaser can exercise the power only if the   power also is exercised by the other person; and                (2)  the other person:                      (A)  can exercise the power without exercise of   the power by the purchaser; or                      (B)  is the transferor to the purchaser of an   interest in the chattel paper.          (f)  If a purchaser has the powers specified in Subsections   (c)(3)(A) and (B), the powers are presumed to be exclusive.          (g)  A purchaser has control of an authoritative electronic   copy of a record evidencing chattel paper if another person, other   than the transferor to the purchaser of an interest in the chattel   paper:                (1)  has control of the authoritative electronic copy   and acknowledges that it has control on behalf of the purchaser; or                (2)  obtains control of the authoritative electronic   copy after having acknowledged that it will obtain control of the   electronic copy on behalf of the purchaser.          SECTION 9.05.  Subchapter A, Chapter 9, Business & Commerce   Code, is amended by adding Section 9.1051 to read as follows:          Sec. 9.1051.  CONTROL OF ELECTRONIC MONEY. (a) A person has   control of electronic money if:                (1)  the electronic money, a record attached to or   logically associated with the electronic money, or a system in   which the electronic money is recorded gives the person:                      (A)  power to avail itself of substantially all   the benefit from the electronic money; and                      (B)  exclusive power, subject to Subsection (b),   to:                            (i)  prevent others from availing themselves   of substantially all the benefit from the electronic money; and                            (ii)  transfer control of the electronic   money to another person or cause another person to obtain control of   other electronic money as a result of the transfer of the electronic   money; and                (2)  the electronic money, a record attached to or   logically associated with the electronic money, or a system in   which the electronic money is recorded enables the person readily   to identify itself in any way, including by name, identifying   number, cryptographic key, office, or account number, as having the   powers under Subdivision (1).          (b)  Subject to Subsection (c), a power is exclusive under   Subsections (a)(1)(B)(i) and (ii) even if:                (1)  the electronic money, a record attached to or   logically associated with the electronic money, or a system in   which the electronic money is recorded limits the use of the   electronic money or has a protocol programmed to cause a change,   including a transfer or loss of control; or                (2)  the power is shared with another person.          (c)  A power of a person is not shared with another person   under Subsection (b)(2) and the person's power is not exclusive if:                (1)  the person can exercise the power only if the power   also is exercised by the other person; and                (2)  the other person:                      (A)  can exercise the power without exercise of   the power by the person; or                      (B)  is the transferor to the person of an   interest in the electronic money.          (d)  If a person has the powers specified in Subsections   (a)(1)(B)(i) and (ii), the powers are presumed to be exclusive.          (e)  A person has control of electronic money if another   person, other than the transferor to the person of an interest in   the electronic money:                (1)  has control of the electronic money and   acknowledges that it has control on behalf of the person; or                (2)  obtains control of the electronic money after   having acknowledged that it will obtain control of the electronic   money on behalf of the person.          SECTION 9.06.  Subchapter A, Chapter 9, Business & Commerce   Code, is amended by adding Sections 9.1072 and 9.1073 to read as   follows:          Sec. 9.1072.  CONTROL OF CONTROLLABLE ELECTRONIC RECORD,   CONTROLLABLE ACCOUNT, OR CONTROLLABLE PAYMENT INTANGIBLE. (a) A   secured party has control of a controllable electronic record as   provided in Section 12A.105.          (b)  A secured party has control of a controllable account or   controllable payment intangible if the secured party has control of   the controllable electronic record that evidences the controllable   account or controllable payment intangible.          Sec. 9.1073.  NO REQUIREMENT TO ACKNOWLEDGE OR CONFIRM; NO   DUTIES. (a) A person that has control under Section 9.104, 9.105,   or 9.1051 is not required to acknowledge that it has control on   behalf of another person.          (b)  If a person acknowledges that it has or will obtain   control on behalf of another person, unless the person otherwise   agrees or law other than this chapter otherwise provides, the   person does not owe any duty to the other person and is not required   to confirm the acknowledgment to any other person.          SECTION 9.07.  Section 9.203(b), Business & Commerce Code,   is amended to read as follows:          (b)  Except as otherwise provided in Subsections (c)-(j), 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 signed [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 9.313   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 8.301 pursuant to the debtor's   security agreement; [or]                      (D)  the collateral is controllable accounts,   controllable electronic records, controllable payment intangibles,   deposit accounts, electronic documents, electronic money,   [electronic chattel paper,] investment property, or   letter-of-credit rights, [or electronic documents,] and the   secured party has control under Section 7.106, 9.104, 9.1051   [9.105], 9.106, [or] 9.107, or 9.1072 pursuant to the debtor's   security agreement; or                      (E)  the collateral is chattel paper and the   secured party has possession and control under Section 9.3141   pursuant to the debtor's security agreement.          SECTION 9.08.  Section 9.204, Business & Commerce Code, is   amended by amending Subsection (b) and adding Subsection (b-1) to   read as follows:          (b)  Subject to Subsection (b-1), a [A] security interest   does not attach under a term constituting an after-acquired   property clause to:                (1)  consumer goods, other than an accession when given   as additional security, unless the debtor acquires rights in them   within 10 days after the secured party gives value; or                (2)  a commercial tort claim.          (b-1)  Subsection (b) does not prevent a security interest   from attaching:                (1)  to consumer goods as proceeds under Section   9.315(a) or commingled goods under Section 9.336(c);                (2)  to a commercial tort claim as proceeds under   Section 9.315(a); or                (3)  under an after-acquired property clause to   property that is proceeds of consumer goods or a commercial tort   claim.          SECTION 9.09.  Section 9.207(c), Business & Commerce Code,   is amended to read as follows:          (c)  Except as otherwise provided in Subsection (d), a   secured party having possession of collateral or control of   collateral under Section 7.106, 9.104, 9.105, 9.1051, 9.106, [or]   9.107, or 9.1072:                (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.          SECTION 9.10.  Section 9.208(b), Business & Commerce Code,   is amended to read as follows:          (b)  Within 10 days after receiving a signed [an   authenticated] demand by the debtor:                (1)  a secured party having control of a deposit   account under Section 9.104(a)(2) shall send to the bank with which   the deposit account is maintained a signed record [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 Section 9.104(a)(3) 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 9.105 of an   authoritative electronic copy of a record evidencing chattel paper    shall transfer control of the electronic copy to the debtor or a   person designated by the debtor [:                      [(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 that 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 Section 8.106(d)(2) or 9.106(b) shall send to the   securities intermediary or commodity intermediary with which the   security entitlement or commodity contract is maintained a signed   [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 9.107 shall send to each   person having an unfulfilled obligation to pay or deliver proceeds   of the letter of credit to the secured party a signed [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 under Section 7.106   of an authoritative copy of an electronic document of title [of an   electronic document] shall transfer control of the electronic copy   to the debtor or a person designated by the debtor;                (7)  a secured party having control under Section   9.1051 of electronic money shall transfer control of the electronic   money to the debtor or a person designated by the debtor; and                (8)  a secured party having control under Section   12A.105 of a controllable electronic record, other than a buyer of a   controllable account or controllable payment intangible evidenced   by the controllable electronic record, shall transfer control of   the controllable electronic record to the debtor or a person   designated by the debtor [:                      [(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].          SECTION 9.11.  Section 9.209(b), Business & Commerce Code,   is amended to read as follows:          (b)  Within 10 days after receiving a signed [an   authenticated] demand by the debtor, a secured party shall send to   an account debtor that has received notification under Section   9.406(a) or 12A.106(b) of an assignment to the secured party as   assignee a signed [under Section 9.406(a) an authenticated] record   that releases the account debtor from any further obligation to the   secured party.          SECTION 9.12.  Sections 9.210(a), (b), (c), (d), and (e),   Business & Commerce Code, are amended to read as follows:          (a)  In this section:                (1)  "Request" means a record of a type described in   Subdivision (2), (3), or (4).                (2)  "Request for an accounting" means a record signed   [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 signed [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 signed [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), 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 14 days after receipt:                (1)  in the case of a request for an accounting, by   signing [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   signing [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 a signed [an authenticated] record including a statement to   that effect within 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 14 days after receipt by   sending to the debtor a signed [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 14 days after receipt by sending to the debtor a signed [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.          SECTION 9.13.  Section 9.301, Business & Commerce Code, is   amended to read as follows:          Sec. 9.301.  LAW GOVERNING PERFECTION AND PRIORITY OF   SECURITY INTERESTS. Except as otherwise provided in Sections 9.303   through 9.3062 [9.306], 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 Subdivision (4),   while [tangible] negotiable tangible documents, goods,   instruments, or tangible 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.          SECTION 9.14.  Section 9.304(a), Business & Commerce Code,   is amended to read as follows:          (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 even if the transaction does not bear any relation to   the bank's jurisdiction.          SECTION 9.15.  Section 9.305(a), Business & Commerce Code,   is amended to read as follows:          (a)  Except as otherwise provided in Subsection (c), 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 Section 8.110(d) 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 Section 8.110(e) 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.                (5)  Subdivisions (2), (3), and (4) apply even if the   transaction does not bear any relation to the jurisdiction.          SECTION 9.16.  Subchapter C, Chapter 9, Business & Commerce   Code, is amended by adding Sections 9.3061 and 9.3062 to read as   follows:          Sec. 9.3061.  LAW GOVERNING PERFECTION AND PRIORITY OF   SECURITY INTERESTS IN CHATTEL PAPER. (a) Except as provided in   Subsection (d), if chattel paper is evidenced only by an   authoritative electronic copy of the chattel paper or is evidenced   by an authoritative electronic copy and an authoritative tangible   copy, the local law of the chattel paper's jurisdiction governs   perfection, the effect of perfection or nonperfection, and the   priority of a security interest in the chattel paper, even if the   transaction does not bear any relation to the chattel paper's   jurisdiction.          (b)  The following rules determine the chattel paper's   jurisdiction under this section:                (1)  If the authoritative electronic copy of the record   evidencing chattel paper, or a record attached to or logically   associated with the electronic copy and readily available for   review, expressly provides that a particular jurisdiction is the   chattel paper's jurisdiction for purposes of this subchapter, this   chapter, or this title, that jurisdiction is the chattel paper's   jurisdiction.                (2)  If Subdivision (1) does not apply and the rules of   the system in which the authoritative electronic copy is recorded   are readily available for review and expressly provide that a   particular jurisdiction is the chattel paper's jurisdiction for   purposes of this subchapter, this chapter, or this title, that   jurisdiction is the chattel paper's jurisdiction.                (3)  If Subdivisions (1) and (2) do not apply and the   authoritative electronic copy, or a record attached to or logically   associated with the electronic copy and readily available for   review, expressly provides that the chattel paper is governed by   the law of a particular jurisdiction, that jurisdiction is the   chattel paper's jurisdiction.                (4)  If Subdivisions (1), (2), and (3) do not apply and   the rules of the system in which the authoritative electronic copy   is recorded are readily available for review and expressly provide   that the chattel paper or the system is governed by the law of a   particular jurisdiction, that jurisdiction is the chattel paper's   jurisdiction.                (5)  If Subdivisions (1) through (4) do not apply, the   chattel paper's jurisdiction is the jurisdiction in which the   debtor is located.          (c)  If an authoritative tangible copy of a record evidences   chattel paper and the chattel paper is not evidenced by an   authoritative electronic copy, while the authoritative tangible   copy of the record evidencing chattel paper is located in a   jurisdiction, the local law of that jurisdiction governs:                (1)  perfection of a security interest in the chattel   paper by possession under Section 9.3141; and                (2)  the effect of perfection or nonperfection and the   priority of a security interest in the chattel paper.          (d)  The local law of the jurisdiction in which the debtor is   located governs perfection of a security interest in chattel paper   by filing.          Sec. 9.3062.  LAW GOVERNING PERFECTION AND PRIORITY OF   SECURITY INTERESTS IN CONTROLLABLE ACCOUNTS, CONTROLLABLE   ELECTRONIC RECORDS, AND CONTROLLABLE PAYMENT INTANGIBLES. (a)   Except as provided in Subsection (b), the local law of the   controllable electronic record's jurisdiction specified in   Sections 12A.107(c) and (d) governs perfection, the effect of   perfection or nonperfection, and the priority of a security   interest in a controllable electronic record and a security   interest in a controllable account or controllable payment   intangible evidenced by the controllable electronic record.          (b)  The local law of the jurisdiction in which the debtor is   located governs:                (1)  perfection of a security interest in a   controllable account, controllable electronic record, or   controllable payment intangible by filing; and                (2)  automatic perfection of a security interest in a   controllable payment intangible created by a sale of the   controllable payment intangible.          SECTION 9.17.  Section 9.310(b), Business & Commerce Code,   is amended to read as follows:          (b)  The filing of a financing statement is not necessary to   perfect a security interest:                (1)  that is perfected under Section 9.308(d), (e),   (f), or (g);                (2)  that is perfected under Section 9.309 when it   attaches;                (3)  in property subject to a statute, regulation, or   treaty described in Section 9.311(a);                (4)  in goods in possession of a bailee that is   perfected under Section 9.312(d)(1) or (2);                (5)  in certificated securities, documents, goods, or   instruments which is perfected without filing, control or   possession under Section 9.312(e), (f), or (g);                (6)  in collateral in the secured party's possession   under Section 9.313;                (7)  in a certificated security that is perfected by   delivery of the security certificate to the secured party under   Section 9.313;                (8)  in controllable accounts, controllable electronic   records, controllable payment intangibles, deposit accounts,   [electronic chattel paper,] electronic documents, investment   property, [virtual currencies,] or letter-of-credit rights that is   perfected by control under Section 9.314;                (8-a)  in chattel paper which is perfected by   possession and control under Section 9.3141;                (9)  in proceeds that is perfected under Section 9.315;   or                (10)  that is perfected under Section 9.316.          SECTION 9.18.  The heading to Section 9.312, Business &   Commerce Code, is amended to read as follows:          Sec. 9.312.  PERFECTION OF SECURITY INTERESTS IN CHATTEL   PAPER, CONTROLLABLE ACCOUNTS, CONTROLLABLE ELECTRONIC RECORDS,   CONTROLLABLE PAYMENT INTANGIBLES, DEPOSIT ACCOUNTS, DOCUMENTS, AND   GOODS COVERED BY DOCUMENTS, INSTRUMENTS, INVESTMENT PROPERTY,   [VIRTUAL CURRENCIES,] LETTER-OF-CREDIT RIGHTS, AND MONEY;   PERFECTION BY PERMISSIVE FILING; TEMPORARY PERFECTION WITHOUT   FILING OR TRANSFER OF POSSESSION.          SECTION 9.19.  Sections 9.312(a), (b), and (e), Business &   Commerce Code, are amended to read as follows:          (a)  A security interest in chattel paper, controllable   accounts, controllable electronic records, controllable payment   intangibles, [negotiable documents,] instruments, investment   property, or negotiable documents [and virtual currencies] may be   perfected by filing.          (b)  Except as otherwise provided in Sections 9.315(c) and   (d) for proceeds:                (1)  a security interest in a deposit account may be   perfected only by control under Section 9.314;                (2)  and except as otherwise provided in Section   9.308(d), a security interest in a letter-of-credit right may be   perfected only by control under Section 9.314; [and]                (3)  a security interest in tangible money may be   perfected only by the secured party's taking possession under   Section 9.313; and                (4)  a security interest in electronic money may be   perfected only by control under Section 9.314.          (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 20 days from the   time it attaches to the extent that it arises for new value given   under a signed [an authenticated] security agreement.          SECTION 9.20.  Sections 9.313(a), (c), and (d), Business &   Commerce Code, are amended to read as follows:          (a)  Except as otherwise provided in Subsection (b), a   secured party may perfect a security interest in [tangible   negotiable documents,] goods, instruments, negotiable tangible   documents, or tangible 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 8.301.          (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 signs [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 signed [authenticated] a record acknowledging that it   will hold possession of the 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   not [no] earlier than the time the secured party takes possession   and continues only while the secured party retains possession.          SECTION 9.21.  Sections 9.314(a), (b), and (c), Business &   Commerce Code, are amended to read as follows:          (a)  A security interest in controllable accounts,   controllable electronic records, controllable payment intangibles,   deposit accounts, electronic documents, electronic money,   investment property, or letter-of-credit rights [investment   property, deposit accounts, letter-of-credit rights, virtual   currencies, electronic chattel paper, or electronic documents] may   be perfected by control of the collateral under Section 7.106,   9.104, 9.1051, [9.105,] 9.106, 9.107, or 9.1072 [9.1071].          (b)  A security interest in controllable accounts,   controllable electronic records, controllable payment intangibles,   deposit accounts, electronic documents, electronic money, or   letter-of-credit rights [deposit accounts, electronic chattel   paper, virtual currencies, letter-of-credit rights, or electronic   documents] is perfected by control under Section 7.106, 9.104,   9.1051, [9.105,] 9.107, or 9.1072 not earlier than the time [9.1071   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 9.106 not earlier than [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.          SECTION 9.22.  Subchapter C, Chapter 9, Business & Commerce   Code, is amended by adding Section 9.3141 to read as follows:          Sec. 9.3141.  PERFECTION BY POSSESSION AND CONTROL OF   CHATTEL PAPER. (a) A secured party may perfect a security interest   in chattel paper by taking possession of each authoritative   tangible copy of the record evidencing the chattel paper and   obtaining control of each authoritative electronic copy of the   electronic record evidencing the chattel paper.          (b)  A security interest is perfected under Subsection (a)   not earlier than the time the secured party takes possession and   obtains control and remains perfected under Subsection (a) only   while the secured party retains possession and control.          (c)  Sections 9.313(c) and (f) through (i) apply to   perfection by possession of an authoritative tangible copy of a   record evidencing chattel paper.          SECTION 9.23.  Sections 9.316(a) and (f), Business &   Commerce Code, are amended to read as follows:          (a)  A security interest perfected pursuant to the law of the   jurisdiction designated in Section 9.301(1), [or] 9.305(c),   9.3061(d), or 9.3062(b) remains perfected until the earliest of:                (1)  the time perfection would have ceased under the   law of that jurisdiction;                (2)  the expiration of four months after a change of the   debtor's location to another jurisdiction; or                (3)  the expiration of one year after a transfer of   collateral to a person that thereby becomes a debtor and is located   in another jurisdiction.          (f)  A security interest in chattel paper, controllable   accounts, controllable electronic records, controllable payment   intangibles, deposit accounts, letter-of-credit rights, or   investment property that is perfected under the law of the chattel   paper's jurisdiction, the controllable electronic record's   jurisdiction, the bank's jurisdiction, the issuer's jurisdiction, a   nominated person's jurisdiction, the securities intermediary's   jurisdiction, or the commodity intermediary's jurisdiction, as   applicable, remains perfected until the earlier of:                (1)  the time the security interest would have become   unperfected under the law of that jurisdiction; or                (2)  the expiration of four months after a change of the   applicable jurisdiction to another jurisdiction.          SECTION 9.24.  Section 9.317, Business & Commerce Code, is   amended by amending Subsections (b) and (d) and adding Subsections   (f), (g), (h), and (i) to read as follows:          (b)  Except as otherwise provided in Subsection (e), a buyer,   other than a secured party, of [tangible chattel paper, tangible   documents,] goods, instruments, tangible documents, or a   certificated security takes free of a security interest or   agricultural lien if the buyer gives value and receives delivery of   the collateral without knowledge of the security interest or   agricultural lien and before it is perfected.          (d)  Subject to Subsections (f) through (i), a [A] licensee   of a general intangible or a buyer, other than a secured party, of   collateral other than electric money, [tangible chattel paper,]   tangible documents, goods, instruments, or a certificated security   takes free of a security interest if the licensee or buyer gives   value without knowledge of the security interest and before it is   perfected.          (f)  A buyer, other than a secured party, of chattel paper   takes free of a security interest if, without knowledge of the   security interest and before it is perfected, the buyer gives value   and:                (1)  receives delivery of each authoritative tangible   copy of the record evidencing the chattel paper; and                (2)  if each authoritative electronic copy of the   record evidencing the chattel paper can be subjected to control   under Section 9.105, obtains control of each authoritative   electronic copy.          (g)  A buyer of an electronic document takes free of a   security interest if, without knowledge of the security interest   and before it is perfected, the buyer gives value and, if each   authoritative electronic copy of the document can be subjected to   control under Section 7.106, obtains control of each authoritative   electronic copy.          (h)  A buyer of a controllable electronic record takes free   of a security interest if, without knowledge of the security   interest and before it is perfected, the buyer gives value and   obtains control of the controllable electronic record.          (i)  A buyer, other than a secured party, of a controllable   account or a controllable payment intangible takes free of a   security interest if, without knowledge of the security interest   and before it is perfected, the buyer gives value and obtains   control of the controllable account or controllable payment   intangible.          SECTION 9.25.  Sections 9.323(d) and (f), Business &   Commerce Code, are amended to read as follows:          (d)  Except as otherwise provided in Subsection (e), a buyer   of goods [other than a buyer in ordinary course of business] takes   free of a security interest to the extent that it secures advances   made after the earlier of:                (1)  the time the secured party acquires knowledge of   the buyer's purchase; or                (2)  45 days after the purchase.          (f)  Except as otherwise provided in Subsection (g), a lessee   of goods[, other than a lessee in ordinary course of business,]   takes the leasehold interest free of a security interest to the   extent that it secures advances made after the earlier of:                (1)  the time the secured party acquires knowledge of   the lease; or                (2)  45 days after the lease contract becomes   enforceable.          SECTION 9.26.  Sections 9.324(b) and (d), Business &   Commerce Code, are amended to read as follows:          (b)  Subject to Subsection (c) and except as otherwise   provided in Subsection (g), a perfected purchase-money security   interest in inventory has priority over a conflicting security   interest in the same inventory, has priority over a conflicting   security interest in chattel paper or an instrument constituting   proceeds of the inventory and in proceeds of the chattel paper, if   so provided in Section 9.330, and, except as otherwise provided in   Section 9.327, also has priority in identifiable cash proceeds of   the inventory to the extent the identifiable cash proceeds are   received on or before the delivery of the inventory to a buyer, if:                (1)  the purchase-money security interest is perfected   when the debtor receives possession of the inventory;                (2)  the purchase-money secured party sends a signed   [an authenticated] notification to the holder of the conflicting   security interest;                (3)  the holder of the conflicting security interest   receives any required notification within five years before the   debtor receives possession of the inventory; and                (4)  the notification states that the person sending   the notification has or expects to acquire a purchase-money   security interest in inventory of the debtor and describes the   inventory.          (d)  Subject to Subsection (e) and except as otherwise   provided in Subsection (g), a perfected purchase-money security   interest in livestock that are farm products has priority over a   conflicting security interest in the same livestock, and, except as   otherwise provided in Section 9.327, a perfected security interest   in their identifiable proceeds and identifiable products in their   unmanufactured states also has priority, if:                (1)  the purchase-money security interest is perfected   when the debtor receives possession of the livestock;                (2)  the purchase-money secured party sends a signed   [an authenticated] notification to the holder of the conflicting   security interest;                (3)  the holder of the conflicting security interest   receives the notification within six months before the debtor   receives possession of the livestock; and                (4)  the notification states that the person sending   the notification has or expects to acquire a purchase-money   security interest in livestock of the debtor and describes the   livestock.          SECTION 9.27.  Subchapter C, Chapter 9, Business & Commerce   Code, is amended by adding Section 9.3261 to read as follows:          Sec. 9.3261.  PRIORITY OF SECURITY INTEREST IN CONTROLLABLE   ACCOUNT, CONTROLLABLE ELECTRONIC RECORD, AND CONTROLLABLE PAYMENT   INTANGIBLE. A security interest in a controllable account,   controllable electronic record, or controllable payment intangible   held by a secured party having control of the account, electronic   record, or payment intangible has priority over a conflicting   security interest held by a secured party that does not have   control.          SECTION 9.28.  Sections 9.330(a), (b), and (f), Business &   Commerce Code, are amended to read as follows:          (a)  A purchaser of chattel paper has priority over a   security interest in the chattel paper that is claimed merely as   proceeds of inventory subject to a security interest if:                (1)  in good faith and in the ordinary course of the   purchaser's business, the purchaser gives new value and takes   possession of each authoritative tangible copy of the record   evidencing the chattel paper, and [or] obtains control under   Section 9.105 of each authoritative electronic copy of the record   evidencing [of] the chattel paper [under Section 9.105]; and                (2)  the authoritative copies of the record evidencing   the chattel paper do [chattel paper does] not indicate that the   chattel paper [it] has been assigned to an identified assignee   other than the purchaser.          (b)  A purchaser of chattel paper has priority over a   security interest in the chattel paper that is claimed other than   merely as proceeds of inventory subject to a security interest if   the purchaser gives new value, [and] takes possession of each   authoritative tangible copy of the record evidencing the chattel   paper, and [or] obtains control under Section 9.105 of each   authoritative electronic copy of the record evidencing [of] the   chattel paper [under Section 9.105] in good faith, in the ordinary   course of the purchaser's business, and without knowledge that the   purchase violates the rights of the secured party.          (f)  For purposes of Subsections (b) and (d), if the   authoritative copies of the record evidencing chattel paper or an   instrument indicate [indicates] that the chattel paper or   instrument [it] has been assigned to an identified secured party   other than the purchaser, a purchaser of the chattel paper or   instrument has knowledge that the purchase violates the rights of   the secured party.          SECTION 9.29.  The heading to Section 9.331, Business &   Commerce Code, is amended to read as follows:          Sec. 9.331.  PRIORITY OF RIGHTS OF PURCHASERS OF   CONTROLLABLE ACCOUNTS, CONTROLLABLE ELECTRONIC RECORDS,   CONTROLLABLE PAYMENT INTANGIBLES, [INSTRUMENTS,] DOCUMENTS,   INSTRUMENTS, AND SECURITIES[, AND VIRTUAL CURRENCIES] UNDER OTHER   CHAPTERS; PRIORITY OF INTERESTS IN FINANCIAL ASSETS AND SECURITY   ENTITLEMENTS AND PROTECTION AGAINST ASSERTION OF CLAIM UNDER   CHAPTERS [CHAPTER] 8 AND 12A [VIRTUAL CURRENCIES UNDER CHAPTER 12].          SECTION 9.30.  Sections 9.331(a) and (b), Business &   Commerce Code, are amended to read as follows:          (a)  This chapter does not limit the rights of a holder in due   course of a negotiable instrument, a holder to which a negotiable   document of title has been duly negotiated, a protected purchaser   of a security, or a qualifying purchaser of a controllable account,   controllable electronic record, or controllable payment intangible   [virtual currency]. These holders or purchasers take priority over   an earlier security interest, even if perfected, to the extent   provided in Chapters 3, 7, 8, and 12A [12].          (b)  This chapter does not limit the rights of or impose   liability on a person to the extent that the person is protected   against the assertion of a claim under Chapter 8 or 12A [12].          SECTION 9.31.  Section 9.332, Business & Commerce Code, is   amended to read as follows:          Sec. 9.332.  TRANSFER OF MONEY; TRANSFER OF FUNDS FROM   DEPOSIT ACCOUNT. (a) A transferee of tangible money takes the   money free of a security interest if the transferee receives   possession of the money without acting [unless the transferee acts]   in collusion with the debtor in violating the rights of the secured   party.          (b)  A transferee of funds from a deposit account takes the   funds free of a security interest in the deposit account if the   transferee receives the funds without acting [unless the transferee   acts] in collusion with the debtor in violating the rights of the   secured party.          (c)  A transferee of electronic money takes the money free of   a security interest if the transferee obtains control of the money   without acting in collusion with the debtor in violating the rights   of the secured party.          SECTION 9.32.  Section 9.334(f), Business & Commerce Code,   is amended to read as follows:          (f)  A security interest in fixtures, whether or not   perfected, has priority over the conflicting interest of an   encumbrancer or owner of the real property if:                (1)  the encumbrancer or owner has, in a signed [an   authenticated] record, consented to the security interest or   disclaimed an interest in the goods as fixtures; or                (2)  the debtor has a right to remove the goods as   against the encumbrancer or owner.          SECTION 9.33.  Section 9.341, Business & Commerce Code, is   amended to read as follows:          Sec. 9.341.  BANK'S RIGHTS AND DUTIES WITH RESPECT TO   DEPOSIT ACCOUNT. Except as otherwise provided in Section 9.340(c),   and unless the bank otherwise agrees in a signed [an authenticated]   record, a bank's rights and duties with respect to a deposit account   maintained with the bank are not terminated, suspended, or modified   by:                (1)  the creation, attachment, or perfection of a   security interest in the deposit account;                (2)  the bank's knowledge of the security interest; or                (3)  the bank's receipt of instructions from the   secured party.          SECTION 9.34.  Section 9.404(a), Business & Commerce Code,   is amended to read as follows:          (a)  Unless an account debtor has made an enforceable   agreement not to assert defenses or claims, and subject to   Subsections (b)-(e), the rights of an assignee are subject to:                (1)  all terms of the agreement between the account   debtor and assignor and any defense or claim in recoupment arising   from the transaction that gave rise to the contract; and                (2)  any other defense or claim of the account debtor   against the assignor that accrues before the account debtor   receives a notification of the assignment signed [authenticated] by   the assignor or the assignee.          SECTION 9.35.  Section 9.406, Business & Commerce Code, is   amended by amending Subsections (a), (b), (c), (d), and (g) and   adding Subsection (l) to read as follows:          (a)  Subject to Subsections (b)-(i) and Subsection (l), an   account debtor on an account, chattel paper, or a payment   intangible may discharge its obligation by paying the assignor   until, but not after, the account debtor receives a notification,   signed [authenticated] by the assignor or the assignee, that the   amount due or to become due has been assigned and that payment is to   be made to the assignee. After receipt of the notification, the   account debtor may discharge its obligation by paying the assignee   and may not discharge the obligation by paying the assignor.          (b)  Subject to Subsections [Subsection] (h) and (l),   notification is ineffective under Subsection (a):                (1)  if it does not reasonably identify the rights   assigned;                (2)  to the extent that an agreement between an account   debtor and a seller of a payment intangible limits the account   debtor's duty to pay a person other than the seller and the   limitation is effective under law other than this chapter; or                (3)  at the option of an account debtor, if the   notification notifies the account debtor to make less than the full   amount of any installment or other periodic payment to the   assignee, even if:                      (A)  only a portion of the account, chattel paper,   or payment intangible has been assigned to that assignee;                      (B)  a portion has been assigned to another   assignee; or                      (C)  the account debtor knows that the assignment   to that assignee is limited.          (c)  Subject to Subsections [Subsection] (h) and (l), if   requested by the account debtor, an assignee shall seasonably   furnish reasonable proof that the assignment has been made. Unless   the assignee complies, the account debtor may discharge its   obligation by paying the assignor, even if the account debtor has   received a notification under Subsection (a).          (d)  In this subsection, "promissory note" includes a   negotiable instrument that evidences chattel paper. Except as   otherwise provided in Subsection (e) and Sections 2A.303 and 9.407,   and subject to Subsection (h), a term in an agreement between an   account debtor and an assignor or in a promissory note is   ineffective to the extent that it:                (1)  prohibits, restricts, or requires the consent of   the account debtor or person obligated on the promissory note to the   assignment or transfer of, or the creation, attachment, perfection,   or enforcement of a security interest in, the account, chattel   paper, payment intangible, or promissory note; or                (2)  provides that the assignment or transfer or the   creation, attachment, perfection, or enforcement of the security   interest may give rise to a default, breach, right of recoupment,   claim, defense, termination, right of termination, or remedy under   the account, chattel paper, payment intangible, or promissory note.          (g)  Subject to Subsections [Subsection] (h) and (l), an   account debtor may not waive or vary its option under Subsection   (b)(3).          (l)  Subsections (a), (b), (c), and (g) do not apply to a   controllable account or controllable payment intangible.          SECTION 9.36.  Section 9.408, Business & Commerce Code, is   amended by adding Subsection (f) to read as follows:          (f)  In this section, "promissory note" includes a   negotiable instrument that evidences chattel paper.          SECTION 9.37.  Sections 9.509(a) and (b), Business &   Commerce Code, are amended to read as follows:          (a)  A person may file an initial financing statement,   amendment that adds collateral covered by a financing statement, or   amendment that adds a debtor to a financing statement only if:                (1)  the debtor authorizes the filing in a signed [an   authenticated] record or pursuant to Subsection (b) or (c); or                (2)  the person holds an agricultural lien that has   become effective at the time of filing and the financing statement   covers only collateral in which the person holds an agricultural   lien.          (b)  By signing [authenticating] or becoming bound as debtor   by a security agreement, a debtor or new debtor authorizes the   filing of an initial financing statement, and an amendment,   covering:                (1)  the collateral described in the security   agreement; and                (2)  property that becomes collateral under Section   9.315(a)(2), whether or not the security agreement expressly covers   proceeds.          SECTION 9.38.  Sections 9.513(b) and (c), Business &   Commerce Code, are amended to read as follows:          (b)  To comply with Subsection (a), a secured party shall   cause the secured party of record to file the termination   statement:                (1)  within one month after there is no obligation   secured by the collateral covered by the financing statement and no   commitment to make advances, incur an obligation, or otherwise give   value; or                (2)  if earlier, within 20 days after the secured party   receives a signed [an authenticated] demand from a debtor.          (c)  In cases not governed by Subsection (a), within 20 days   after a secured party receives a signed [an authenticated] demand   from a debtor, the secured party shall cause the secured party of   record for a financing statement to send the debtor a termination   statement for the financing statement or file the termination   statement in the filing office if:                (1)  except in the case of a financing statement   covering accounts or chattel paper that has been sold or goods that   are the subject of a consignment, there is no obligation secured by   the collateral covered by the financing statement and no commitment   to make an advance, incur an obligation, or otherwise give value;                (2)  the financing statement covers accounts or chattel   paper that has been sold but as to which the account debtor or other   person obligated has discharged its obligation;                (3)  the financing statement covers goods that were the   subject of a consignment to the debtor but are not in the debtor's   possession; or                (4)  the debtor did not authorize the filing of the   initial financing statement.          SECTION 9.39.  Section 9.601(b), Business & Commerce Code,   is amended to read as follows:          (b)  A secured party in possession of collateral or control   of collateral under Section 7.106, 9.104, 9.105, 9.1051, 9.106,   [or] 9.107, or 9.1072 has the rights and duties provided in Section   9.207.          SECTION 9.40.  Section 9.605, Business & Commerce Code, is   amended to read as follows:          Sec. 9.605.  UNKNOWN DEBTOR OR SECONDARY OBLIGOR. (a)   Except as provided in Subsection (b), a [A] secured party does not   owe a duty based on its status as secured party:                (1)  to a person that is a debtor or obligor, unless the   secured party knows:                      (A)  that the person is a debtor or obligor;                      (B)  the identity of the person; and                      (C)  how to communicate with the person; or                (2)  to a secured party or lienholder that has filed a   financing statement against a person, unless the secured party   knows:                      (A)  that the person is a debtor; and                      (B)  the identity of the person.          (b)  A secured party owes a duty based on its status as a   secured party to a person if, at the time the secured party obtains   control of collateral that is a controllable account, controllable   electronic record, or controllable payment intangible or at the   time the security interest attaches to the collateral, whichever is   later:                (1)  the person is a debtor or obligor; and                (2)  the secured party knows that the information in   Subsection (a)(1)(A), (B), or (C) relating to the person is not   provided by the collateral, a record attached to or logically   associated with the collateral, or the system in which the   collateral is recorded.          SECTION 9.41.  Section 9.608(a), Business & Commerce Code,   is amended to read as follows:          (a)  If a security interest or agricultural lien secures   payment or performance of an obligation, the following rules apply:                (1)  A secured party shall apply or pay over for   application the cash proceeds of collection or enforcement under   Section 9.607 in the following order to:                      (A)  the reasonable expenses of collection and   enforcement and, to the extent provided for by agreement and not   prohibited by law, reasonable attorney's fees and legal expenses   incurred by the secured party;                      (B)  the satisfaction of obligations secured by   the security interest or agricultural lien under which the   collection or enforcement is made; and                      (C)  the satisfaction of obligations secured by   any subordinate security interest in or other lien on the   collateral subject to the security interest or agricultural lien   under which the collection or enforcement is made if the secured   party receives a signed [an authenticated] demand for proceeds   before distribution of the proceeds is completed.                (2)  If requested by a secured party, a holder of a   subordinate security interest or other lien shall furnish   reasonable proof of the interest or lien within a reasonable time.   Unless the holder complies, the secured party need not comply with   the holder's demand under Subdivision (1)(C).                (3)  A secured party need not apply or pay over for   application noncash proceeds of collection and enforcement under   Section 9.607 unless the failure to do so would be commercially   unreasonable. A secured party that applies or pays over for   application noncash proceeds shall do so in a commercially   reasonable manner.                (4)  A secured party shall account to and pay a debtor   for any surplus, and the obligor is liable for any deficiency.          SECTION 9.42.  Sections 9.611(a), (b), (c), and (e),   Business & Commerce Code, are amended to read as follows:          (a)  In this section, "notification date" means the earlier   of the date on which:                (1)  a secured party sends to the debtor and any   secondary obligor a signed [an authenticated] notification of   disposition; or                (2)  the debtor and any secondary obligor waive the   right to notification.          (b)  Except as otherwise provided in Subsection (d), a   secured party that disposes of collateral under Section 9.610 shall   send to the persons specified in Subsection (c) a reasonable signed   [authenticated] notification of disposition.          (c)  To comply with Subsection (b), the secured party shall   send a signed [an authenticated] notification of disposition to:                (1)  the debtor;                (2)  any secondary obligor; and                (3)  if the collateral is other than consumer goods:                      (A)  any other person from which the secured party   has received, before the notification date, a signed [an   authenticated] notification of a claim of an interest in the   collateral;                      (B)  any other secured party or lienholder that,   10 days before the notification date, held a security interest in or   other lien on the collateral perfected by the filing of a financing   statement that:                            (i)  identified the collateral;                            (ii)  was indexed under the debtor's name as   of that date; and                            (iii)  was filed in the office in which to   file a financing statement against the debtor covering the   collateral as of that date; and                      (C)  any other secured party that, 10 days before   the notification date, held a security interest in the collateral   perfected by compliance with a statute, regulation, or treaty   described in Section 9.311(a).          (e)  A secured party complies with the requirement for   notification prescribed by Subsection (c)(3)(B) if:                (1)  not later than 20 days or earlier than 30 days   before the notification date, the secured party requests, in a   commercially reasonable manner, information concerning financing   statements indexed under the debtor's name in the office indicated   in Subsection (c)(3)(B); and                (2)  before the notification date, the secured party:                      (A)  did not receive a response to the request for   information; or                      (B)  received a response to the request for   information and sent a signed [an authenticated] notification of   disposition to each secured party or other lienholder named in that   response whose financing statement covered the collateral.          SECTION 9.43.  Section 9.613, Business & Commerce Code, is   amended to read as follows:          Sec. 9.613.  CONTENTS AND FORM OF NOTIFICATION BEFORE   DISPOSITION OF COLLATERAL: GENERAL. (a) Except in a   consumer-goods transaction, the following rules apply:                (1)  The contents of a notification of disposition are   sufficient if the notification:                      (A)  describes the debtor and the secured party;                      (B)  describes the collateral that is the subject   of the intended disposition;                      (C)  states the method of intended disposition;                      (D)  states that the debtor is entitled to an   accounting of the unpaid indebtedness and states the charge, if   any, for an accounting; and                      (E)  states the time and place of a public   disposition or the time after which any other disposition is to be   made.                (2)  Whether the contents of a notification that lacks   any of the information specified in Subdivision (1) are   nevertheless sufficient is a question of fact.                (3)  The contents of a notification providing   substantially the information specified in Subdivision (1) are   sufficient, even if the notification includes:                      (A)  information not specified by that   subdivision; or                      (B)  minor errors that are not seriously   misleading.                (4)  A particular phrasing of the notification is not   required.                (5)  The following form of notification and the form   appearing in Section 9.614(a)(3) [9.614(3)], when completed in   accordance with the instructions in Subsection (b) and Section   9.614(b), each provide sufficient information:   NOTIFICATION OF DISPOSITION OF COLLATERAL   To: (Name of debtor, obligor, or other person to which the   notification is sent)   From: (Name, address, and telephone number of secured party)   {1} Name of any debtor that is not an addressee: (Name of each   debtor)   {2} We will sell (describe collateral) (to the highest qualified   bidder) at public sale. A sale could include a lease or license. The   sale will be held as follows:   (Date)   (Time)   (Place)   {3} We will sell (describe collateral) at private sale sometime   after (date). A sale could include a lease or license.   {4} You are entitled to an accounting of the unpaid indebtedness   secured by the property that we intend to sell or, as applicable,   lease or license.   {5} If you request an accounting you must pay a charge of $   (amount).   {6} You may request an accounting by calling us at (telephone   number).          (b)  The following instructions apply to the form of   notification in Subsection (a)(5):                (1)  The instructions in this subsection refer to the   numbers in braces before items in the form of notification in   Subsection (a)(5). Do not include the numbers or braces in the   notification. The numbers and braces are used only for the purpose   of these instructions.                (2)  Include and complete item {1} only if there is a   debtor that is not an addressee of the notification and list the   name or names.                (3)  Include and complete either item {2}, if the   notification relates to a public disposition of the collateral, or   item {3}, if the notification relates to a private disposition of   the collateral. If item {2} is included, include the words "to the   highest qualified bidder" only if applicable.                (4)  Include and complete items {4} and {6}.                (5)  Include and complete item {5} only if the sender   will charge the recipient for an accounting.   [NOTIFICATION OF DISPOSITION OF COLLATERAL   [To: __________________[Name of debtor, obligor, or other person to   which the notification is sent]   [From: ________[Name, address, and telephone number of secured   party]   [Name of Debtor(s): ________________ [Include only if debtor(s) are   not an addressee]   [[For a public disposition:]   [We will sell [or lease or license, as applicable] the [describe   collateral] [to the highest qualified bidder] in public as follows:   [Day and Date: ______ Time: _____ Place: _______[For a private   disposition:]   [We will sell [or lease or license, as applicable] the _________   [describe collateral] privately sometime after _____ [day and   date].   [You are entitled to an accounting of the unpaid indebtedness   secured by the property that we intend to sell [or lease or license,   as applicable] [for a charge of $____]. You may request an   accounting by calling us at ______ [telephone number].]          SECTION 9.44.  Section 9.614, Business & Commerce Code, is   amended to read as follows:          Sec. 9.614.  CONTENTS AND FORM OF NOTIFICATION BEFORE   DISPOSITION OF COLLATERAL: CONSUMER-GOODS TRANSACTION. (a) In a   consumer-goods transaction, the following rules apply:                (1)  A notification of disposition must provide the   following information:                      (A)  the information specified in Section   9.613(a)(1) [9.613(1)];                      (B)  a description of any liability for a   deficiency of the person to which the notification is sent;                      (C)  a telephone number from which the amount that   must be paid to the secured party to redeem the collateral under   Section 9.623 is available; and                      (D)  a telephone number or mailing address from   which additional information concerning the disposition and the   obligation secured is available.                (2)  A particular phrasing of the notification is not   required.                (3)  The following form of notification, when completed   in accordance with the instructions in Subsection (b), provides   sufficient information:   (Name and address of secured party)   (Date)   NOTICE OF OUR PLAN TO SELL PROPERTY   (Name and address of any obligor who is also a debtor)   Subject: (Identify transaction)   We have your (describe collateral), because you broke promises in   our agreement.   {1} We will sell (describe collateral) at public sale. A sale could   include a lease or license. The sale will be held as follows:   (Date)   (Time)   (Place)   You may attend the sale and bring bidders if you want.   {2} We will sell (describe collateral) at private sale sometime   after (date). A sale could include a lease or license.   {3} The money that we get from the sale, after paying our costs,   will reduce the amount you owe. If we get less money than you owe,   you (will or will not, as applicable) still owe us the difference.   If we get more money than you owe, you will get the extra money,   unless we must pay it to someone else.   {4} You can get the property back at any time before we sell it by   paying us the full amount you owe, not just the past due payments,   including our expenses. To learn the exact amount you must pay, call   us at (telephone number).   {5} If you want us to explain to you in (writing) (writing or in   (description of electronic record)) (description of electronic   record) how we have figured the amount that you owe us,   {6}  call us at (telephone number) (or) (write us at (secured   party's address)) (or contact us by (description of electronic   communication method))   {7}  and request (a written explanation) (a written explanation or   an explanation in (description of electronic record)) (an   explanation in (description of electronic record)).   {8} We will charge you $ (amount) for the explanation if we sent you   another written explanation of the amount you owe us within the last   six months.   {9} If you need more information about the sale (call us at   (telephone number)) (or) (write us at (secured party's address))   (or contact us by (description of electronic communication   method)).   {10} We are sending this notice to the following other people who   have an interest in (describe collateral) or who owe money under   your agreement:   (Names of all other debtors and obligors, if any)   [________________ [Name and address of secured party]   [________________ [Date]   [NOTICE OF OUR PLAN TO SELL PROPERTY   [________________ [Name and address of any obligor who is also a   debtor]   [Subject: ___________ [Identification of Transaction]   [We have your _________[describe collateral], because you broke   promises in our agreement.   [[For a public disposition:]   [We will sell _________[describe collateral] at public sale. A   sale could include a lease or license. The sale will be held as   follows:          [Date:_______________________________________          [Time:_______________________________________          [Place:______________________________________   [You may attend the sale and bring bidders if you want.   [[For a private disposition:]   [We will sell ___________[describe collateral] at private sale   sometime after ________[date]. A sale could include a lease or   license.   [The money that we get from the sale (after paying our costs) will   reduce the amount you owe. If we get less money than you owe, you   ________[will or will not, as applicable] still owe us the   difference. If we get more money than you owe, you will get the   extra money, unless we must pay it to someone else.   [You can get the property back at any time before we sell it by   paying us the full amount you owe (not just the past due payments),   including our expenses. To learn the exact amount you must pay,   call us at __________[telephone number].   [If you want us to explain to you in writing how we have figured the   amount that you owe us, you may call us at ______[telephone number]   [or write us at _______[secured party's address] ___________] and   request a written explanation. [We will charge you $________ for   the explanation if we sent you another written explanation of the   amount you owe us within the last six months.]   [If you need more information about the sale call us at _________   [telephone number] [or write us at ______ [secured party's address]   _______________].   [We are sending this notice to the following other people who have   an interest in _______________[describe collateral] or who owe   money under your agreement:   [______________________________________ [Names of all other   debtors and obligors, if any]]                (4)  A notification in the form of Subdivision (3) is   sufficient, even if additional information appears at the end of   the form.                (5)  A notification in the form of Subdivision (3) is   sufficient, even if it includes errors in information not required   by Subdivision (1), unless the error is misleading with respect to   rights arising under this chapter.                (6)  If a notification under this section is not in the   form of Subdivision (3), law other than this chapter determines the   effect of including information not required by Subdivision (1).          (b)  The following instructions apply to the form of   notification in Subsection (a)(3):                (1)  The instructions in this subsection refer to the   numbers in braces before items in the form of notification in   Subsection (a)(3). Do not include the numbers or braces in the   notification. The numbers and braces are used only for the purpose   of these instructions.                (2)  Include and complete either item {1}, if the   notification relates to a public disposition of the collateral, or   item {2}, if the notification relates to a private disposition of   the collateral.                (3)  Include and complete items {3}, {4}, {5}, {6}, and   {7}.                (4)  In item {5}, include and complete any one of the   three alternative methods for the explanation-writing, writing or   electronic record, or electronic record.                (5)  In item {6}, include the telephone number. In   addition, the sender may include and complete either or both of the   two additional alternative methods of communication-writing or   electronic communication-for the recipient of the notification to   communicate with the sender. Neither of the two additional methods   of communication is required to be included.                (6)  In item {7}, include and complete the method or   methods for the explanation-writing, writing or electronic record,   or electronic record-included in item {5}.                (7)  Include and complete item {8} only if a written   explanation is included in item {5} as a method for communicating   the explanation and the sender will charge the recipient for   another written explanation.                (8)  In item {9}, include either the telephone number   or the address or both the telephone number and the address. In   addition, the sender may include and complete the additional method   of communication-electronic communication-for the recipient of the   notification to communicate with the sender. The additional method   of electronic communication is not required to be included.                (9)  If item {10} does not apply, insert "None" after   "agreement:".          SECTION 9.45.  Section 9.615(a), Business & Commerce Code,   is amended to read as follows:          (a)  A secured party shall apply or pay over for application   the cash proceeds of disposition under Section 9.610 in the   following order to:                (1)  the reasonable expenses of retaking, holding,   preparing for disposition, processing, and disposing and, to the   extent provided for by agreement and not prohibited by law,   reasonable attorney's fees and legal expenses incurred by the   secured party;                (2)  the satisfaction of obligations secured by the   security interest or agricultural lien under which the disposition   is made;                (3)  the satisfaction of obligations secured by any   subordinate security interest in or other subordinate lien on the   collateral if:                      (A)  the secured party receives from the holder of   the subordinate security interest or other lien a signed [an   authenticated] demand for proceeds before distribution of the   proceeds is completed; and                      (B)  in a case in which a consignor has an interest   in the collateral, the subordinate security interest or other lien   is senior to the interest of the consignor; and                (4)  a secured party that is a consignor of the   collateral if the secured party receives from the consignor a   signed [an authenticated] demand for proceeds before distribution   of the proceeds is completed.          SECTION 9.46.  Sections 9.616(a), (b), and (c), Business &   Commerce Code, are amended to read as follows:          (a)  In this section:                (1)  "Explanation" means a record [writing] that:                      (A)  states the amount of the surplus or   deficiency;                      (B)  provides an explanation in accordance with   Subsection (c) of how the secured party calculated the surplus or   deficiency;                      (C)  states, if applicable, that future debits,   credits, charges, including additional credit service charges or   interest, rebates, and expenses may affect the amount of the   surplus or deficiency; and                      (D)  provides a telephone number or mailing   address from which additional information concerning the   transaction is available.                (2)  "Request" means a record:                      (A)  signed [authenticated] by a debtor or   consumer obligor;                      (B)  requesting that the recipient provide an   explanation; and                      (C)  sent after disposition of the collateral   under Section 9.610.          (b)  In a consumer-goods transaction in which the debtor is   entitled to a surplus or a consumer obligor is liable for a   deficiency under Section 9.615, the secured party shall:                (1)  send an explanation to the debtor or consumer   obligor, as applicable, after the disposition and:                      (A)  before or when the secured party accounts to   the debtor and pays any surplus or first makes [written] demand in a   record on the consumer obligor after the disposition for payment of   the deficiency; and                      (B)  within 14 days after receipt of a request; or                (2)  in the case of a consumer obligor who is liable for   a deficiency, within 14 days after receipt of a request, send to the   consumer obligor a record waiving the secured party's right to a   deficiency.          (c)  To comply with Subsection (a)(1)(B), an explanation [a   writing] must provide the following information in the following   order:                (1)  the aggregate amount of obligations secured by the   security interest under which the disposition was made and, if the   amount reflects a rebate of unearned interest or credit service   charge, an indication of that fact, calculated as of a specified   date:                      (A)  if the secured party takes or receives   possession of the collateral after default, not more than 35 days   before the secured party takes or receives possession; or                      (B)  if the secured party takes or receives   possession of the collateral before default or does not take   possession of the collateral, not more than 35 days before the   disposition;                (2)  the amount of proceeds of the disposition;                (3)  the aggregate amount of the obligations after   deducting the amount of proceeds;                (4)  the amount, in the aggregate or by type, and types   of expenses, including expenses of retaking, holding, preparing for   disposition, processing, and disposing of the collateral, and   attorney's fees secured by the collateral which are known to the   secured party and relate to the current disposition;                (5)  the amount, in the aggregate or by type, and types   of credits, including rebates of interest or credit service   charges, to which the obligor is known to be entitled and which are   not reflected in the amount in Subdivision (1); and                (6)  the amount of the surplus or deficiency.          SECTION 9.47.  Section 9.619(a), Business & Commerce Code,   is amended to read as follows:          (a)  In this section, "transfer statement" means a record   signed [authenticated] by a secured party stating:                (1)  that the debtor has defaulted in connection with   an obligation secured by specified collateral;                (2)  that the secured party has exercised its   post-default remedies with respect to the collateral;                (3)  that, by reason of the exercise, a transferee has   acquired the rights of the debtor in the collateral; and                (4)  the name and mailing address of the secured party,   debtor, and transferee.          SECTION 9.48.  Sections 9.620(a), (b), (c), and (f),   Business & Commerce Code, are amended to read as follows:          (a)  Except as otherwise provided in Subsection (g), a   secured party may accept collateral in full or partial satisfaction   of the obligation it secures only if:                (1)  the debtor consents to the acceptance under   Subsection (c);                (2)  the secured party does not receive, within the   time set forth in Subsection (d), a notification of objection to the   proposal signed [authenticated] by:                      (A)  a person to which the secured party was   required to send a proposal under Section 9.621; or                      (B)  any other person, other than the debtor,   holding an interest in the collateral subordinate to the security   interest that is the subject of the proposal;                (3)  if the collateral is consumer goods, the   collateral is not in the possession of the debtor when the debtor   consents to the acceptance; and                (4)  Subsection (e) does not require the secured party   to dispose of the collateral or the debtor waives the requirement   pursuant to Section 9.624.          (b)  A purported or apparent acceptance of collateral under   this section is ineffective unless:                (1)  the secured party consents to the acceptance in a   signed [an authenticated] record or sends a proposal to the debtor;   and                (2)  the conditions of Subsection (a) are met.          (c)  For purposes of this section:                (1)  a debtor consents to an acceptance of collateral   in partial satisfaction of the obligation it secures only if the   debtor agrees to the terms of the acceptance in a record signed   [authenticated] after default; and                (2)  a debtor consents to an acceptance of collateral   in full satisfaction of the obligation it secures only if the debtor   agrees to the terms of the acceptance in a record signed   [authenticated] after default or the secured party:                      (A)  sends to the debtor after default a proposal   that is unconditional or subject only to a condition that   collateral not in the possession of the secured party be preserved   or maintained;                      (B)  in the proposal, proposes to accept   collateral in full satisfaction of the obligation it secures; and                      (C)  does not receive a notification of objection   signed [authenticated] by the debtor within 20 days after the   proposal is sent.          (f)  To comply with Subsection (e), the secured party shall   dispose of the collateral:                (1)  within 90 days after taking possession; or                (2)  within any longer period to which the debtor and   all secondary obligors have agreed in an agreement to that effect   entered into and signed [authenticated] after default.          SECTION 9.49.  Section 9.621(a), Business & Commerce Code,   is amended to read as follows:          (a)  A secured party that desires to accept collateral in   full or partial satisfaction of the obligation it secures shall   send its proposal to:                (1)  any person from which the secured party has   received, before the debtor consented to the acceptance, a signed   [an authenticated] notification of a claim of an interest in the   collateral;                (2)  any other secured party or lienholder that, 10   days before the debtor consented to the acceptance, held a security   interest in or other lien on the collateral perfected by the filing   of a financing statement that:                      (A)  identified the collateral;                      (B)  was indexed under the debtor's name as of   that date; and                      (C)  was filed in the office or offices in which to   file a financing statement against the debtor covering the   collateral as of that date; and                (3)  any other secured party that, 10 days before the   debtor consented to the acceptance, held a security interest in the   collateral perfected by compliance with a statute, regulation, or   treaty described in Section 9.311(a).          SECTION 9.50.  Section 9.624, Business & Commerce Code, is   amended to read as follows:          Sec. 9.624.  WAIVER. (a) A debtor or secondary obligor may   waive the right to notification of disposition of collateral under   Section 9.611 only by an agreement to that effect entered into and   signed [authenticated] after default.          (b)  A debtor may waive the right to require disposition of   collateral under Section 9.620(e) only by an agreement to that   effect entered into and signed [authenticated] after default.          (c)  Except in a consumer-goods transaction, a debtor or   secondary obligor may waive the right to redeem collateral under   Section 9.623 only by an agreement to that effect entered into and   signed [authenticated] after default.          SECTION 9.51.  Section 9.628, Business & Commerce Code, is   amended by amending Subsections (a) and (b) and adding Subsection   (f) to read as follows:          (a)  Subject to Subsection (f), unless [Unless] a secured   party knows that a person is a debtor or obligor, knows the identity   of the person, and knows how to communicate with the person:                (1)  the secured party is not liable to the person, or   to a secured party or lienholder that has filed a financing   statement against the person, for failure to comply with this   chapter; and                (2)  the secured party's failure to comply with this   chapter does not affect the liability of the person for a   deficiency.          (b)  Subject to Subsection (f), a [A] secured party is not   liable because of its status as secured party:                (1)  to a person that is a debtor or obligor, unless the   secured party knows:                      (A)  that the person is a debtor or obligor;                      (B)  the identity of the person; and                      (C)  how to communicate with the person; or                (2)  to a secured party or lienholder that has filed a   financing statement against a person, unless the secured party   knows:                      (A)  that the person is a debtor; and                      (B)  the identity of the person.          (f)  Subsections (a) and (b) do not apply to limit the   liability of a secured party to a person if, at the time the secured   party obtains control of collateral that is a controllable account,   controllable electronic record, or controllable payment intangible   or at the time the security interest attaches to the collateral,   whichever is later:                (1)  the person is a debtor or obligor; and                (2)  the secured party knows that the information in   Subsection (b)(1)(A), (B), or (C) relating to the person is not   provided by the collateral, a record attached to or logically   associated with the collateral, or the system in which the   collateral is recorded.   ARTICLE 10. CONTROLLABLE ELECTRONIC RECORDS          SECTION 10.01.  Title 1, Business & Commerce Code, is   amended by adding Chapters 12A and 12B to read as follows:   CHAPTER 12A. CONTROLLABLE ELECTRONIC RECORDS          Sec. 12A.101.  TITLE. This chapter may be cited as Uniform   Commercial Code - Controllable Electronic Records.          Sec. 12A.102.  DEFINITIONS. (a) In this chapter:                (1)  "Controllable electronic record" means a record   stored in an electronic medium that can be subjected to control   under Section 12A.105. The term does not include a controllable   account, a controllable payment intangible, a deposit account, an   electronic copy of a record evidencing chattel paper, an electronic   document of title, electronic money, investment property, or a   transferable record.                (2)  "Qualifying purchaser" means a purchaser of a   controllable electronic record or an interest in a controllable   electronic record that obtains control of the controllable   electronic record for value, in good faith, and without notice of a   claim of a property right in the controllable electronic record.                (3)  "Transferable record" has the meaning provided for   that term in:                      (A)  Section 201(a)(1) of the Electronic   Signatures in Global and National Commerce Act, 15 U.S.C. Section   7021(a)(1), as amended; or                      (B)  Section 322.016(a) of this code.                (4)  "Value" has the meaning provided in Section   3.303(a), as if references in that subsection to an "instrument"   were references to a controllable account, controllable electronic   record, or controllable payment intangible.          (b)  The definitions in Chapter 9 of "account debtor,"   "controllable account," "controllable payment intangible,"   "chattel paper," "deposit account," "electronic money," and   "investment property" apply to this chapter.          (c)  Chapter 1 contains general definitions and principles   of construction and interpretation applicable throughout this   chapter.          Sec. 12A.103.  RELATION TO CHAPTER 9 AND CONSUMER LAWS. (a)   If there is conflict between this chapter and Chapter 9, Chapter 9   governs.          (b)  A transaction subject to this chapter is subject to any   applicable rule of law that establishes a different rule for   consumers and to:                (1)  Title 4, Finance Code; and                (2)  Subchapter E, Chapter 17, of this code.          Sec. 12A.104.  RIGHTS IN CONTROLLABLE ACCOUNT, CONTROLLABLE   ELECTRONIC RECORD, AND CONTROLLABLE PAYMENT INTANGIBLE. (a) This   section applies to the acquisition and purchase of rights in a   controllable account or controllable payment intangible, including   the rights and benefits under Subsections (c), (d), (e), (g), and   (h) of a purchaser and qualifying purchaser, in the same manner this   section applies to a controllable electronic record.          (b)  To determine whether a purchaser of a controllable   account or a controllable payment intangible is a qualifying   purchaser, the purchaser obtains control of the account or payment   intangible if it obtains control of the controllable electronic   record that evidences the account or payment intangible.          (c)  Except as provided in this section, law other than this   chapter determines whether a person acquires a right in a   controllable electronic record and the right the person acquires.          (d)  A purchaser of a controllable electronic record   acquires all rights in the controllable electronic record that the   transferor had or had power to transfer, except that a purchaser of   a limited interest in a controllable electronic record acquires   rights only to the extent of the interest purchased.          (e)  A qualifying purchaser acquires its rights in the   controllable electronic record free of a claim of a property right   in the controllable electronic record.          (f)  Except as provided in Subsections (a) and (e) for a   controllable account and a controllable payment intangible or law   other than this chapter, a qualifying purchaser takes a right to   payment, right to performance, or other interest in property   evidenced by the controllable electronic record subject to a claim   of a property right in the right to payment, right to performance,   or other interest in property.          (g)  An action may not be asserted against a qualifying   purchaser based on both a purchase by the qualifying purchaser of a   controllable electronic record and a claim of a property right in   another controllable electronic record, whether the action is   framed in conversion, replevin, constructive trust, equitable   lien, or other theory.          (h)  Filing of a financing statement under Chapter 9 is not   notice of a claim of a property right in a controllable electronic   record.          Sec. 12A.105.  CONTROL OF CONTROLLABLE ELECTRONIC RECORD.   (a) A person has control of a controllable electronic record if the   electronic record, a record attached to or logically associated   with the electronic record, or a system in which the electronic   record is recorded:                (1)  gives the person:                      (A)  power to avail itself of substantially all   the benefit from the electronic record; and                      (B)  exclusive power, subject to Subsection (b),   to:                            (i)  prevent others from availing themselves   of substantially all the benefit from the electronic record; and                            (ii)  transfer control of the electronic   record to another person or cause another person to obtain control   of another controllable electronic record as a result of the   transfer of the electronic record; and                (2)  enables the person readily to identify itself in   any way, including by name, identifying number, cryptographic key,   office, or account number, as having the powers specified in   Subdivision (1).          (b)  Subject to Subsection (c), a power is exclusive under   Subsections (a)(1)(B)(i) and (ii) even if:                (1)  the controllable electronic record, a record   attached to or logically associated with the electronic record, or   a system in which the electronic record is recorded limits the use   of the electronic record or has a protocol programmed to cause a   change, including a transfer or loss of control or a modification of   benefits afforded by the electronic record; or                (2)  the power is shared with another person.          (c)  A power of a person is not shared with another person   under Subsection (b)(2) and the person's power is not exclusive if:                (1)  the person can exercise the power only if the power   also is exercised by the other person; and                (2)  the other person:                      (A)  can exercise the power without exercise of   the power by the person; or                      (B)  is the transferor to the person of an   interest in the controllable electronic record or a controllable   account or controllable payment intangible evidenced by the   controllable electronic record.          (d)  If a person has the powers specified in Subsections   (a)(1)(B)(i) and (ii), the powers are presumed to be exclusive.          (e)  A person has control of a controllable electronic record   if another person, other than the transferor to the person of an   interest in the controllable electronic record or a controllable   account or controllable payment intangible evidenced by the   controllable electronic record:                (1)  has control of the electronic record and   acknowledges that it has control on behalf of the person; or                (2)  obtains control of the electronic record after   having acknowledged that it will obtain control of the electronic   record on behalf of the person.          (f)  A person that has control under this section is not   required to acknowledge that it has control on behalf of another   person.          (g)  If a person acknowledges that it has or will obtain   control on behalf of another person, unless the person otherwise   agrees or law other than this chapter or Chapter 9 otherwise   provides, the person does not owe any duty to the other person and   is not required to confirm the acknowledgment to any other person.          Sec. 12A.106.  DISCHARGE OF ACCOUNT DEBTOR ON CONTROLLABLE   ACCOUNT OR CONTROLLABLE PAYMENT INTANGIBLE. (a) An account debtor   on a controllable account or controllable payment intangible may   discharge its obligation by paying:                (1)  the person having control of the controllable   electronic record that evidences the controllable account or   controllable payment intangible; or                (2)  except as provided in Subsection (b), a person   that formerly had control of the controllable electronic record.          (b)  Subject to Subsection (d), the account debtor may not   discharge its obligation by paying a person that formerly had   control of the controllable electronic record if the account debtor   receives a notification that:                (1)  is signed by a person that formerly had control or   the person to which control was transferred;                (2)  reasonably identifies the controllable account or   controllable payment intangible;                (3)  notifies the account debtor that control of the   controllable electronic record that evidences the controllable   account or controllable payment intangible was transferred;                (4)  identifies the transferee, in any reasonable way,   including by name, identifying number, cryptographic key, office,   or account number; and                (5)  provides a commercially reasonable method by which   the account debtor is to pay the transferee.          (c)  After receipt of a notification that complies with   Subsection (b), the account debtor may discharge its obligation by   paying in accordance with the notification and may not discharge   the obligation by paying a person that formerly had control.          (d)  Subject to Subsection (h), notification is ineffective   under Subsection (b):                (1)  unless, before the notification is sent, the   account debtor and the person that, at that time, had control of the   controllable electronic record that evidences the controllable   account or controllable payment intangible agree in a signed record   to a commercially reasonable method by which a person may furnish   reasonable proof that control has been transferred;                (2)  to the extent an agreement between the account   debtor and seller of a payment intangible limits the account   debtor's duty to pay a person other than the seller and the   limitation is effective under law other than this chapter; or                (3)  at the option of the account debtor, if the   notification notifies the account debtor to:                      (A)  divide a payment;                      (B)  make less than the full amount of an   installment or other periodic payment; or                      (C)  pay any part of a payment by more than one   method or to more than one person.          (e)  Subject to Subsection (h), if requested by the account   debtor, the person giving the notification under Subsection (b)   seasonably shall furnish reasonable proof, using the method in the   agreement referred to in Subsection (d)(1), that control of the   controllable electronic record has been transferred. Unless the   person complies with the request, the account debtor may discharge   its obligation by paying a person that formerly had control, even if   the account debtor has received a notification under Subsection   (b).          (f)  A person furnishes reasonable proof under Subsection   (e) that control has been transferred if the person demonstrates,   using the method in the agreement referred to in Subsection (d)(1),   that the transferee has the power to:                (1)  avail itself of substantially all the benefit from   the controllable electronic record;                (2)  prevent others from availing themselves of   substantially all the benefit from the controllable electronic   record; and                (3)  transfer the powers specified in Subdivisions (1)   and (2) to another person.          (g)  Subject to Subsection (h), an account debtor may not   waive or vary its rights under Subsections (d)(1) and (e) or its   option under Subsection (d)(3).          (h)  This section is subject to law other than this chapter   which establishes a different rule for an account debtor who is an   individual and who incurred the obligation primarily for personal,   family, or household purposes.          Sec. 12A.107.  GOVERNING LAW. (a) Except as provided in   Subsection (b), the local law of a controllable electronic record's   jurisdiction governs a matter covered by this chapter.          (b)  For a controllable electronic record that evidences a   controllable account or controllable payment intangible, the local   law of the controllable electronic record's jurisdiction governs a   matter covered by Section 12A.106 unless an effective agreement   determines that the local law of another jurisdiction governs.          (c)  The following rules determine a controllable electronic   record's jurisdiction under this section:                (1)  If the controllable electronic record, or a record   attached to or logically associated with the controllable   electronic record and readily available for review, expressly   provides that a particular jurisdiction is the controllable   electronic record's jurisdiction for purposes of this chapter or   this title, that jurisdiction is the controllable electronic   record's jurisdiction.                (2)  If Subdivision (1) does not apply and the rules of   the system in which the controllable electronic record is recorded   are readily available for review and expressly provide that a   particular jurisdiction is the controllable electronic record's   jurisdiction for purposes of this chapter or this title, that   jurisdiction is the controllable electronic record's jurisdiction.                (3)  If Subdivisions (1) and (2) do not apply and the   controllable electronic record, or a record attached to or   logically associated with the controllable electronic record and   readily available for review, expressly provides that the   controllable electronic record is governed by the law of a   particular jurisdiction, that jurisdiction is the controllable   electronic record's jurisdiction.                (4)  If Subdivisions (1), (2), and (3) do not apply and   the rules of the system in which the controllable electronic record   is recorded are readily available for review and expressly provide   that the controllable electronic record or the system is governed   by the law of a particular jurisdiction, that jurisdiction is the   controllable electronic record's jurisdiction.                (5)  If Subdivisions (1) through (4) do not apply, the   controllable electronic record's jurisdiction is the District of   Columbia.          (d)  If Subsection (c)(5) applies and Chapter 12 is not in   effect in the District of Columbia without material modification,   the governing law for a matter covered by this chapter is the law of   the District of Columbia as though Chapter 12 were in effect in the   District of Columbia without material modification. In this   subsection, "Chapter 12" means Chapter 12 of Uniform Commercial   Code Amendments (2022).          (e)  To the extent Subsections (a) and (b) provide that the   local law of the controllable electronic record's jurisdiction   governs a matter covered by this chapter, that law governs even if   the matter or a transaction to which the matter relates does not   bear any relation to the controllable electronic record's   jurisdiction.   CHAPTER 12B. TRANSITIONAL PROVISIONS FOR UNIFORM COMMERCIAL CODE   AMENDMENTS (2022)   SUBCHAPTER A. GENERAL PROVISIONS AND DEFINITIONS          Sec. 12B.101.  TITLE. This chapter may be cited as   Transitional Provisions for Uniform Commercial Code Amendments   (2022).          Sec. 12B.102.  DEFINITIONS. (a)  In this chapter:                (1)  "Adjustment date" means July 1, 2025.                (2)  "Amending act" means the Act of the 88th   Legislature, Regular Session, 2023, that enacted this chapter.                (3)  "Chapter 12A property" means a controllable   account, controllable electronic record, or controllable payment   intangible.                (4)  "Repealed Chapter 12" means former Chapter 12 as   that chapter existed immediately before repeal by the amending act.          (b)  The following definitions in other chapters of this   title apply to this chapter.          "Controllable account"Section 9.102.          "Controllable electronic record"Section 12A.102.          "Controllable payment intangible"Section 9.102.          "Electronic money"Section 9.102.          "Financing statement"Section 9.102.          (c)  Chapter 1 contains general definitions and principles   of construction and interpretation applicable throughout this   chapter.   SUBCHAPTER B. GENERAL TRANSITIONAL PROVISION          Sec. 12B.201.  SAVING CLAUSE. Except as provided in   Subchapter C, a transaction validly entered into before September   1, 2023, and the rights, duties, and interests flowing from the   transaction remain valid thereafter and may be terminated,   completed, consummated, or enforced as required or permitted by law   other than this title or, if applicable, this title, as though the   amending act had not taken effect.   SUBCHAPTER C. TRANSITIONAL PROVISIONS FOR CHAPTERS 9, 12, and 12A          Sec. 12B.301.  SAVING CLAUSE. (a)  Except as provided in   this subchapter, Chapter 9, as amended by the amending act, and   Chapter 12A, as added by the amending act, apply to a transaction,   lien, or other interest in property, even if the transaction, lien,   or interest was entered into, created, or acquired before September   1, 2023.          (b)  Except as provided in Subsection (c) and Sections   12B.302 through 12B.306:                (1)  a transaction, lien, or interest in property that   was validly entered into, created, or transferred before September   1, 2023, and was not governed by this title, but would be subject to   Chapter 9, as amended by the amending act, or Chapter 12A, as added   by the amending act, if it had been entered into, created, or   transferred on or after September 1, 2023, including the rights,   duties, and interests flowing from the transaction, lien, or   interest, remains valid on and after September 1, 2023; and                (2)  the transaction, lien, or interest in property may   be terminated, completed, consummated, and enforced as required or   permitted by the amending act or by the law that would apply if the   amending act had not taken effect.          (c)  Notwithstanding any other provision of this chapter:                (1)  virtual currency under repealed Chapter 12 and   Chapter 9, as that chapter existed before its amendment by the   amending act, constitutes a controllable electronic record under   Chapter 9, as amended by the amending act, and Chapter 12A, as added   by the amending act; and                (2)  control of a virtual currency accomplished under   repealed Chapter 12 constitutes control of a controllable   electronic record under Chapter 9, as amended by the amending act,   and Chapter 12A, as added by the amending act.          (d)  The amending act does not affect an action, case, or   proceeding commenced before September 1, 2023.          Sec. 12B.302.  SECURITY INTEREST PERFECTED BEFORE EFFECTIVE   DATE. (a)  A security interest that is enforceable and perfected   immediately before September 1, 2023, is a perfected security   interest under this title, as amended by the amending act, if, on   September 1, 2023, the requirements for enforceability and   perfection under this title, as amended by the amending act, are   satisfied without further action.          (b)  If a security interest is enforceable and perfected   immediately before September 1, 2023, but the requirements for   enforceability or perfection under this title, as amended by the   amending act, are not satisfied on September 1, 2023, the security   interest:                (1)  is a perfected security interest until the earlier   of the time perfection would have ceased under the law in effect   immediately before September 1, 2023, or the adjustment date;                (2)  remains enforceable thereafter only if the   security interest satisfies the requirements for enforceability   under Section 9.203, as amended by the amending act, before the   adjustment date; and                (3)  remains perfected thereafter only if the   requirements for perfection under the title, as amended by the   amending act, are satisfied before the time specified in   Subdivision (1).          Sec. 12B.303.  SECURITY INTEREST UNPERFECTED BEFORE   EFFECTIVE DATE. A security interest that is enforceable   immediately before September 1, 2023, but is unperfected at that   time:                (1)  remains an enforceable security interest until the   adjustment date;                (2)  remains enforceable thereafter if the security   interest becomes enforceable under Section 9.203, as amended by the   amending act, on September 1, 2023, or before the adjustment date;   and                (3)  becomes perfected:                      (A)  without further action, on September 1, 2023,   if the requirements for perfection under this title, as amended by   the amending act, are satisfied before or at that time; or                      (B)  when the requirements for perfection are   satisfied if the requirements are satisfied after that time.          Sec. 12B.304.  EFFECTIVENESS OF ACTION TAKEN BEFORE   EFFECTIVE DATE. (a)  If action, other than the filing of a   financing statement, is taken before September 1, 2023, and the   action would have resulted in perfection of the security interest   had the security interest become enforceable before September 1,   2023, the action is effective to perfect a security interest that   attaches under this title, as amended by the amending act, before   the adjustment date. An attached security interest becomes   unperfected on the adjustment date unless the security interest   becomes a perfected security interest under this title, as amended   by the amending act, before the adjustment date.          (b)  The filing of a financing statement before September 1,   2023, is effective to perfect a security interest on September 1,   2023, to the extent the filing would satisfy the requirements for   perfection under this title, as amended by the amending act.          (c)  The taking of an action before September 1, 2023, is   sufficient for the enforceability of a security interest on   September 1, 2023, if the action would satisfy the requirements for   enforceability under this title, as amended by the amending act.          Sec. 12B.305.  PRIORITY. (a)  Subject to Subsections (b) and   (c), this title, as amended by the amending act, determines the   priority of conflicting claims to collateral.          (b)  Subject to Subsection (c), if the priorities of claims   to collateral were established before September 1, 2023, Chapter 9,   as in effect immediately before September 1, 2023, determines   priority.          (c)  On the adjustment date, to the extent the priorities   determined by Chapter 9, as amended by the amending act, modify the   priorities established before September 1, 2023, the priorities of   claims to Chapter 12A property and electronic money established   before September 1, 2023, cease to apply.          Sec. 12B.306.  PRIORITY OF CLAIMS WHEN PRIORITY RULES OF   CHAPTER 9 DO NOT APPLY. (a)  Subject to Subsections (b) and (c),   Chapter 12A determines the priority of conflicting claims to   Chapter 12A property when the priority rules of Chapter 9, as   amended by the amending act, do not apply.          (b)  Subject to Subsection (c), when the priority rules of   Chapter 9, as amended by the amending act, do not apply and the   priorities of claims to Chapter 12A property were established   before September 1, 2023, law other than Chapter 12A determines   priority.          (c)  When the priority rules of Chapter 9, as amended by the   amending act, do not apply, to the extent the priorities determined   by this title, as amended by the amending act, modify the priorities   established before September 1, 2023, the priorities of claims to   Chapter 12A property established before September 1, 2023, cease to   apply on the adjustment date.   ARTICLE 11. REPEALERS          SECTION 11.01.  The following provisions of Title 1,   Business & Commerce Code, are repealed:                (1)  Section 7.102(a)(12);                (2)  Sections 9.102(a)(7), (31), (75), and (79);                (3)  Section 9.1071; and                (4)  Chapter 12.   ARTICLE 12.  EFFECTIVE DATE          SECTION 12.01.  This Act takes effect September 1, 2023.