Section 9–102. Definitions And Index of Definitions.

(a) Article 9 definitions. In this article:

(1) "Accession" means goods that are physically united with other

goods in such a manner that the identity of the original

goods is not lost.

(2) "Account", except as used in "account for", means a right to

payment of a monetary obligation, whether or not earned by

performance, (i) for property that has been or is to be sold,

leased, licensed, assigned, or otherwise disposed of, (ii)

for services rendered or to be rendered, (iii) for a policy

of insurance issued or to be issued, (iv) for a secondary

obligation incurred or to be incurred, (v) for energy

provided or to be provided, (vi) for the use or hire of a

vessel under a charter or other contract, (vii) arising out

of the use of a credit or charge card or information

contained on or for use with the card, or (viii) as winnings

in a lottery or other game of chance operated or sponsored by

a state, governmental unit of a State, or person licensed or

authorized to operate the game by a State or governmental

unit of a State. The term includes health-care-insurance

receivables. The term does not include (i) rights to payment

evidenced by chattel paper or an instrument, (ii) commercial

tort claims, (iii) deposit accounts, (iv) investment

property, (v) letter-of-credit rights or letters of credit,

or (vi) rights to payment for money or funds advanced or

sold, other than rights arising out of the use of a credit or

charge card or information contained on or for use with the

card.

(3) "Account debtor" means a person obligated on an account,

chattel paper, or general intangible. The term does not

include persons obligated to pay a negotiable instrument,

even if the instrument constitutes part of chattel paper.

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

record:

(A) authenticated by a secured party;

(B) indicating the aggregate unpaid secured obligations as of

a date not more than 35 days earlier or 35 days later

than the date of the record; and

(C) identifying the components of the obligations in

reasonable detail.

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

(A) which secures payment or performance of an obligation

for:

(i) goods or services furnished in connection with a

debtor's farming operation; or

(ii) rent on real property leased by a debtor in

connection with its farming operation; and

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

(i) in the ordinary course of its business furnished

goods or services to a debtor in connection with a

debtor's farming operation; or

(ii) leased real property to a debtor in connection with

the debtor's farming operation; and

(C) whose effectiveness does not depend on the person's

possession of the personal property.

(6) "As-extracted collateral" means:

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

security interest that:

(i) is created by a debtor having an interest in the

minerals before extraction; and

(ii) attaches to the minerals as extracted; or

(B) accounts arising out of the sale at the wellhead or

minehead of oil, gas, or other minerals in which the

debtor had an interest before extraction.

(7) "Authenticate" means:

(A) to sign; or

(B) with present intent to adopt or accept a record, to

attach to or logically associate with the record an

electronic sound, symbol, or process.

(8) "Bank" means an organization that is engaged in the business

of banking. The term includes savings banks, savings and loan

associations, credit unions, and trust companies.

(9) "Cash proceeds" means proceeds that are money, checks,

deposit accounts, or the like.

(10) "Certificate of title" means a certificate of title with

respect to which a statute provides for the security

interest in question to be indicated on the certificate as a

condition or result of the security interest's obtaining

priority over the rights of a lien creditor with respect to

the collateral. Such term includes another record maintained

as an alternative to a certificate of title by the

governmental unit that issues certificates of title if a

statute permits the security interest in question to be

indicated on the record as a condition or result of the

security interest's obtaining priority over the rights of a

lien creditor with respect to the collateral.

(11) "Chattel paper" means a record or records that evidence both

a monetary obligation and a security interest in specific

goods, a security interest in specific goods and software

used in the goods, a security interest in specific goods and

license of software used in the goods, a lease of specific

goods, or a lease of specific goods and license of software

used in the goods. In this paragraph, "monetary obligation"

means a monetary obligation secured by the goods or owed

under a lease of 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.

(11-a) "Check" means (i) a draft, other than a documentary draft,

payable on demand and drawn on a bank or (ii) a cashier's

check or a teller's check. An instrument may be a check

even though it is described on its face by another term,

such as "money order". An instrument that (i) meets all of

the requirements stated in Article 3 of this chapter to be

a negotiable instrument other than stating that it is

payable to order or bearer and (ii) otherwise qualifies as

a check is a negotiable instrument and a check.

(12) "Collateral" means the property subject to a security

interest or agricultural lien. The term includes:

(A) proceeds to which a security interest attaches;

(B) accounts, chattel paper, payment intangibles, and

promissory notes that have been sold; and

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

(13) "Commercial tort claim" means a claim arising in tort with

respect to which:

(A) the claimant is an organization; or

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

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

profession; and

(ii) does not include damages arising out of personal

injury to or the death of an individual.

(14) "Commodity account" means an account maintained by a

commodity intermediary in which a commodity contract is

carried for a commodity customer.

(15) "Commodity contract" means a commodity futures contract, an

option on a commodity futures contract, a commodity option,

or another contract if the contract or option is:

(A) traded on or subject to the rules of a board of trade

that has been designated as a contract market for such a

contract pursuant to federal commodities laws; or

(B) traded on a foreign commodity board of trade, exchange,

or market, and is carried on the books of a commodity

intermediary for a commodity customer.

(16) "Commodity customer" means a person for which a commodity

intermediary carries a commodity contract on its books.

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

(A) is registered as a futures commission merchant under

federal commodities law; or

(B) in the ordinary course of its business provides clearance

or settlement services for a board of trade that has been

designated as a contract market pursuant to federal

commodities law.

(18) "Communicate" means:

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

(B) to transmit a record by any means agreed upon by the

persons sending and receiving the record; or

(C) in the case of transmission of a record to or by a filing

office, to transmit a record by any means prescribed by

filing-office rule.

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

a consignment.

(20) "Consignment" means a transaction, regardless of its form,

in which a person delivers goods to a merchant for the

purpose of sale and:

(A) the merchant:

(i) deals in goods of that kind under a name other than

the name of the person making delivery;

(ii) is not an auctioneer; and

(iii) is not generally known by its creditors to be

substantially engaged in selling the goods of

others;

(B) with respect to each delivery, the aggregate value of the

goods is $1,000 or more at the time of delivery;

(C) the goods are not consumer goods immediately before

delivery; and

(D) the transaction does not create a security interest that

secures an obligation.

(21) "Consignor" means a person that delivers goods to a

consignee in a consignment.

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

(23) "Consumer goods" means goods that are used or bought for use

primarily for personal, family, or household purposes.

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

which:

(A) an individual incurs an obligation primarily for

personal, family, or household purposes; and

(B) a security interest in consumer goods secures the

obligation.

(25) "Consumer obligor" means an obligor who is an individual and

who incurred the obligation as part of a transaction entered

into primarily for personal, family, or household purposes.

(26) "Consumer transaction" means a transaction in which (i) an

individual incurs an obligation primarily for personal,

family, or household purposes, (ii) a security interest

secures the obligation, and (iii) the collateral is held or

acquired primarily for personal, family, or household

purposes. The term includes consumer-goods transactions.

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

statement which:

(A) identifies, by its file number, the initial financing

statement to which it relates; and

(B) indicates that it is a continuation statement for, or

that it is filed to continue the effectiveness of, the

identified financing statement.

(27-a) "Cooperative addendum" means a record that satisfies

Section 9–502(e).

(27-b) "Cooperative interest" means an ownership interest in a

cooperative organization, which interest, when created, is

coupled with possessory rights of a proprietary nature in

identified physical space belonging to the cooperative

organization. A subsequent termination of the possessory

rights shall not cause an ownership interest to cease

being a cooperative interest.

(27-c) "Cooperative organization" means an organization which has

as its principal asset an interest in real property in

this state and in which organization all ownership

interests are cooperative interests.

(27-d) "Cooperative organization security interest" means a

security interest which is in a cooperative interest, is

in favor of the cooperative organization, is created by

the cooperative record, and secures only obligations

incident to ownership of that cooperative interest.

(27-e) "Cooperative record" means those records which, as a

whole, evidence cooperative interests and define the

mutual rights and obligations of the owners of the

cooperative interests and the cooperative organization.

(27-f) "Cooperative unit" means the physical space associated

with a cooperative interest.

(28) "Debtor" means:

(A) a person having an interest, other than a security

interest or other lien, in the collateral, whether or not

the person is an obligor;

(B) a seller of accounts, chattel paper, payment intangibles,

or promissory notes; or

(C) a consignee.

(29) "Deposit account" means a demand, time, savings, passbook,

or similar account maintained with a bank. The term does not

include investment property or accounts evidenced by an

instrument.

(30) "Document" means a document of title or a receipt of the

type described in Section 7–201 (b).

(31) "Electronic chattel paper" means chattel paper evidenced by

a record or records consisting of information stored in an

electronic medium.

(32) "Encumbrance" means a right, other than an ownership

interest, in real property. The term includes mortgages and

other liens on real property.

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

or consumer goods.

(34) "Farm products" means goods, other than standing timber,

with respect to which the debtor is engaged in a farming

operation and which are:

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

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

(ii) aquatic goods produced in aquacultural operations;

(B) livestock, born or unborn, including aquatic goods

produced in aquacultural operations;

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

(D) products of crops or livestock in their unmanufactured

states.

(35) "Farming operation" means raising, cultivating, propagating,

fattening, grazing, or any other farming, livestock, or

aquacultural operation.

(36) "File number" means the number assigned to an initial

financing statement pursuant to Section 9–519(a).

(37) "Filing office" means an office designated in Section 9–501

as the place to file a financing statement.

(38) "Filing-office rule" means a rule adopted pursuant to

Section 9–526.

(39) "Financing statement" means a record or records composed of

an initial financing statement and any filed record relating

to the initial financing statement.

(40) "Fixture filing" means the filing of a financing statement

covering goods that are or are to become fixtures and

satisfying Section 9–502(a) and (b). The term includes the

filing of a financing statement covering goods of a

transmitting utility which are or are to become fixtures.

(41) "Fixtures" means goods that have become so related to

particular real property that an interest in them arises

under real property law.

(42) "General intangible" means any personal property, including

things in action, other than accounts, chattel paper,

commercial tort claims, deposit accounts, documents, goods,

instruments, investment property, letter-of-credit rights,

letters of credit, money, and oil, gas, or other minerals

before extraction. The term includes payment intangibles and

software.

(43) "Good faith" means honesty in fact and the observance of

reasonable commercial standards of fair dealing.

(44) "Goods" means all things that are movable when a security

interest attaches. The term includes (i) fixtures, (ii)

standing timber that is to be cut and removed under a

conveyance or contract for sale, (iii) the unborn young of

animals, (iv) crops grown, growing, or to be grown, even if

the crops are produced on trees, vines, or bushes, and (v)

manufactured homes. The term also includes a computer

program embedded in goods and any supporting information

provided in connection with a transaction relating to the

program if (i) the program is associated with the goods in

such a manner that it customarily is considered part of the

goods, or (ii) by becoming the owner of the goods, a person

acquires a right to use the program in connection with the

goods. The term does not include a computer program embedded

in goods that consists solely of the medium in which the

program is embedded. The term also does not include

accounts, chattel paper, commercial tort claims, deposit

accounts, documents, general intangibles, instruments,

investment property, letter-of-credit rights, letters of

credit, money, or oil, gas, or other minerals before

extraction.

(45) "Governmental unit" means a subdivision, agency, department,

county, parish, municipality, or other unit of the

government of the United States, a state, or a foreign

country. The term includes an organization having a separate

corporate existence if the organization is eligible to issue

debt on which interest is exempt from income taxation under

the laws of the United States.

(46) "Health-care-insurance receivable" means an interest in or

claim under a policy of insurance which is a right to

payment of a monetary obligation for health-care goods or

services provided or to be provided.

(47) "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, or (iii) writings that

evidence a right to payment arising out of the use of a

credit or charge card or information contained on or for use

with the card.

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

(A) are leased by a person as lessor;

(B) are held by a person for sale or lease or to be furnished

under a contract of service;

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

(D) consist of raw materials, work in process, or materials

used or consumed in a business.

(49) "Investment property" means a security, whether certificated

or uncertificated, security entitlement, securities account,

commodity contract, or commodity account.

(50) "Jurisdiction of organization", with respect to a registered

organization, means the jurisdiction under whose law the

organization is formed or organized.

(51) "Letter-of-credit right" means a right to payment or

performance under a letter of credit, whether or not the

beneficiary has demanded or is at the time entitled to

demand payment or performance. The term does not include the

right of a beneficiary to demand payment or performance

under a letter of credit.

(52) "Lien creditor" means:

(A) a creditor that has acquired a lien on the property

involved by attachment, levy, or the like;

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

assignment;

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

the petition; or

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

(53) "Manufactured home" means a structure, transportable in one

or more sections, which, in the traveling mode, is eight

body feet or more in width or 40 body feet or more in

length, or, when erected on site, is 320 or more square

feet, and which is built on a permanent chassis and designed

to be used as a dwelling with or without a permanent

foundation when connected to the required utilities, and

includes the plumbing, heating, air-conditioning, and

electrical systems contained therein. The term includes any

structure that meets all of the requirements of this

paragraph except the size requirements and with respect to

which the manufacturer voluntarily files a certification

required by the United States Secretary of Housing and Urban

Development and complies with the standards established

under Title 42 of the United States Code.

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

(A) that creates a purchase-money security interest in a

manufactured home, other than a manufactured home held as

inventory; or

(B) in which a manufactured home, other than a manufactured

home held as inventory, is the primary collateral.

(55) "Mortgage" means a consensual interest in real property,

including fixtures, which secures payment or performance of

an obligation.

(56) "New debtor" means a person that becomes bound as debtor

under Section 9–203(d) by a security agreement previously

entered into by another person.

(57) "New value" means (i) money, (ii) money's worth in property,

services, or new credit, or (iii) release by a transferee of

an interest in property previously transferred to the

transferee. The term does not include an obligation

substituted for another obligation.

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

(59) "Obligor" means a person that, with respect to an obligation

secured by a security interest in or an agricultural lien on

the collateral, (i) owes payment or other performance of the

obligation, (ii) has provided property other than the

collateral to secure payment or other performance of the

obligation, or (iii) is otherwise accountable in whole or in

part for payment or other performance of the obligation. The

term does not include issuers or nominated persons under a

letter of credit.

(60) "Original debtor", except as used in Section 9–310(c),

means a person that, as debtor, entered into a security

agreement to which a new debtor has become bound under

Section 9–203(d).

(60-a) "Payment assurance device" means any device installed in a

vehicle that can be used to remotely disable the vehicle.

(61) "Payment intangible" means a general intangible under which

the account debtor's principal obligation is a monetary

obligation.

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

(A) the spouse of the individual;

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

the individual;

(C) an ancestor or lineal descendant of the individual or the

individual's spouse; or

(D) any other relative, by blood or marriage, of the

individual or the individual's spouse who shares the same

home with the individual.

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

(A) a person directly or indirectly controlling, controlled

by, or under common control with the organization;

(B) an officer or director of, or a person performing similar

functions with respect to, the organization;

(C) an officer or director of, or a person performing similar

functions with respect to, a person described in

subparagraph (A);

(D) the spouse of an individual described in subparagraph

(A), (B), or (C); or

(E) an individual who is related by blood or marriage to an

individual described in subparagraph (A), (B), (C), or

(D) and shares the same home with the individual.

(64) "Proceeds", except as used in Section 9–609(b), means the

following property:

(A) Whatever is acquired upon the sale, lease, license,

exchange, or other disposition of collateral;

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

collateral;

(C) rights arising out of collateral;

(D) to the extent of the value of collateral, claims arising

out of the loss, nonconformity, or interference with the

use of, defects or infringement of rights in, or damage

to, the collateral; or

(E) to the extent of the value of collateral and to the

extent payable to the debtor or the secured party,

insurance payable by reason of the loss or nonconformity

of, defects or infringement of rights in, or damage to,

the collateral.

(65) "Promissory note" means an instrument that evidences a

promise to pay a monetary obligation, does not evidence an

order to pay, and does not contain an acknowledgment by a

bank that the bank has received for deposit a sum of money

or funds.

(66) "Proposal" means a record authenticated by a secured party

which includes the terms on which the secured party is

willing to accept collateral in full or partial satisfaction

of the obligation it secures pursuant to Sections 9–620,

9–621, and 9–622.

(66-a) "Prove" with respect to a fact means to meet the burden of

establishing the fact (Section 1-201(8)).

(67) "Public-finance transaction" means a secured transaction in

connection with which:

(A) debt securities are issued;

(B) all or a portion of the securities issued have an initial

stated maturity of at least 20 years; and

(C) the debtor, obligor, secured party, account debtor or

other person obligated on collateral, assignor or

assignee of a secured obligation, or assignor or assignee

of a security interest is a state or a governmental unit

of a state.

(68) "Public organic record" means a record that is available to

the public for inspection and is:

(A) a record consisting of the record initially filed with or

issued by a state or the United States to form or

organize an organization and any record filed with or

issued by the state or the United States which amends or

restates the initial record;

(B) an organic record of a business trust consisting of the

record initially filed with a state and any record filed

with the state which amends or restates the initial

record, if a statute of the state governing business

trusts requires that the record be filed with the state;

or

(C) a record consisting of legislation enacted by the

legislature of a state or the Congress of the United

States which forms or organizes an organization, any

record amending the legislation, and any record filed

with or issued by the state or the United States which

amends or restates the name of the organization.

(69) "Pursuant to commitment", with respect to an advance made or

other value given by a secured party, means pursuant to the

secured party's obligation, whether or not a subsequent

event of default or other event not within the secured

party's control has relieved or may relieve the secured

party from its obligation.

(70) "Record", except as used in "for record", "of record",

"record or legal title", and "record owner", means

information that is inscribed on a tangible medium or which

is stored in an electronic or other medium and is

retrievable in perceivable form.

(71) "Registered organization" means an organization formed or

organized solely under the law of a single state or the

United States by the filing of a public organic record with,

the issuance of a public organic record by, or the enactment

of legislation by the state or the United States. The term

includes a business trust that is formed or organized under

the law of a single state if a statute of the state

governing business trusts requires that the business trust's

organic record be filed with the state.

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

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

(B) the obligor has a right of recourse with respect to an

obligation secured by collateral against the debtor,

another obligor, or property of either.

(73) "Secured party" means:

(A) a person in whose favor a security interest is created or

provided for under a security agreement, whether or not

any obligation to be secured is outstanding;

(B) a person that holds an agricultural lien;

(C) a consignor;

(D) a person to which accounts, chattel paper, payment

intangibles, or promissory notes have been sold;

(E) a trustee, indenture trustee, agent, collateral agent, or

other representative in whose favor a security interest

or agricultural lien is created or provided for; or

(F) a person that holds a security interest arising under

Section 2–401, 2–505, 2–711(3), 2-A-508(5), 4–210, or

5–118.

(74) "Security agreement" means an agreement that creates or

provides for a security interest. A cooperative record that

provides that the owner of a cooperative interest has an

obligation to pay amounts to the cooperative organization

incident to ownership of that cooperative interest and which

states that the cooperative organization has a direct remedy

against that cooperative interest if such amounts are not

paid is a security agreement creating a cooperative

organization security interest.

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

(A) to deposit in the mail, deliver for transmission, or

transmit by any other usual means of communication, with

postage or cost of transmission provided for, addressed

to any address reasonable under the circumstances; or

(B) to cause the record or notification to be received within

the time that it would have been received if properly

sent under subparagraph (A).

(76) "Software" means a computer program and any supporting

information provided in connection with a transaction

relating to the program. The term does not include a

computer program that is included in the definition of

goods.

(77) "State" means a state of the United States, the District of

Columbia, Puerto Rico, the United States Virgin Islands, or

any territory or insular possession subject to the

jurisdiction of the United States.

(78) "Supporting obligation" means a letter-of-credit right or

secondary obligation that supports the payment or

performance of an account, chattel paper, a document, a

general intangible, an instrument, or investment property.

(79) "Tangible chattel paper" means chattel paper evidenced by a

record or records consisting of information that is

inscribed on a tangible medium.

(80) "Termination statement" means an amendment of a financing

statement which:

(A) identifies, by its file number, the initial financing

statement to which it relates; and

(B) indicates either that it is a termination statement or

that the identified financing statement is no longer

effective.

(81) "Transmitting utility" means a person primarily engaged in

the business of:

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

bus;

(B) transmitting communications electrically,

electromagnetically, or by light;

(C) transmitting goods by pipeline or sewer; or

(D) transmitting or producing and transmitting electricity,

steam, gas, or water.

(b) Definitions in other articles. The following definitions in other articles apply to this article:

"Applicant" Section 5–102.

"Beneficiary" Section 5–102.

"Broker" Section 8–102.

"Certificated security" Section 8–102.

"Clearing corporation" Section 8–102.

"Contract for sale" Section 2–106.

"Control" (with respect to a document Section 7–106.

of title)

"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 or letter-of-credit right) Section 5–102.

"Issuer" (with respect to a security) Section 8–201.

"Issuer" (with respect to document of title) Section 7–102.

"Lease" Section 2-A-103.

"Lease agreement" Section 2-A-103.

"Lease contract" Section 2-A-103.

"Leasehold interest" Section 2-A-103.

"Lessee" Section 2-A-103.

"Lessee in ordinary course of business" Section 2-A-103.

"Lessor" Section 2-A-103.

"Lessor's residual interest" Section 2-A-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.

"Prove" Section 4-A-105.

"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.

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