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First Substitute S.B. 91

Senator Lyle W. Hillyard proposes the following substitute bill:


             1     
UNIFORM COMMERCIAL CODE - GENERAL

             2     
PROVISIONS

             3     
2007 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Lyle W. Hillyard

             6     
House Sponsor: Fred R. Hunsaker

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill modifies the general provisions of the Uniform Commercial Code.
             11      Highlighted Provisions:
             12          This bill:
             13          .    repeals Title 70A, Chapter 1, General Provisions;
             14          .    enacts the revised Article 1 of the Uniform Commercial Code as Title 70A, Chapter
             15      1a, General Provisions, including provisions related to:
             16              .    the construction and interpretation of the Uniform Commercial Code;
             17              .    the relationship between the Uniform Commercial Code and other laws;
             18              .    the applicability of the Uniform Commercial Code; and
             19              .    defining terms;
             20          .    amends other provisions of the Uniform Commercial Code, to conform with the
             21      adoption of Title 70A, Chapter 1a, General Provisions; and
             22          .    makes technical amendments.
             23      Monies Appropriated in this Bill:
             24          None
             25      Other Special Clauses:


             26          None
             27      Utah Code Sections Affected:
             28      AMENDS:
             29          11-14-501, as renumbered and amended by Chapter 105, Laws of Utah 2005
             30          15-8-4, as last amended by Chapter 12, Laws of Utah 1994
             31          24-1-3, as last amended by Chapter 296, Laws of Utah 2004
             32          32A-11a-102, as last amended by Chapter 1, Laws of Utah 2000
             33          41-1a-601, as last amended by Chapter 252, Laws of Utah 2000
             34          46-4-103, as enacted by Chapter 74, Laws of Utah 2000
             35          46-4-403, as last amended by Chapter 42, Laws of Utah 2006
             36          70A-2-103, as last amended by Chapter 42, Laws of Utah 2006
             37          70A-2-202, as enacted by Chapter 154, Laws of Utah 1965
             38          70A-2a-103, as last amended by Chapter 42, Laws of Utah 2006
             39          70A-2a-501, as last amended by Chapter 237, Laws of Utah 1993
             40          70A-2a-518, as last amended by Chapter 237, Laws of Utah 1993
             41          70A-2a-519, as last amended by Chapter 237, Laws of Utah 1993
             42          70A-2a-527, as last amended by Chapter 237, Laws of Utah 1993
             43          70A-2a-528, as last amended by Chapter 237, Laws of Utah 1993
             44          70A-3-103, as last amended by Chapter 60, Laws of Utah 1998
             45          70A-4-104, as last amended by Chapter 42, Laws of Utah 2006
             46          70A-4a-105, as last amended by Chapter 237, Laws of Utah 1993
             47          70A-4a-106, as last amended by Chapter 237, Laws of Utah 1993
             48          70A-4a-204, as last amended by Chapter 237, Laws of Utah 1993
             49          70A-5-103, as repealed and reenacted by Chapter 241, Laws of Utah 1997
             50          70A-8-101, as last amended by Chapter 71, Laws of Utah 2005
             51          70A-7a-102, as enacted by Chapter 42, Laws of Utah 2006
             52          70A-9a-102.1, as last amended by Chapter 42, Laws of Utah 2006
             53          70A-10-104, as last amended by Chapter 42, Laws of Utah 2006
             54          70C-2-204, as enacted by Chapter 159, Laws of Utah 1985
             55      ENACTS:
             56          70A-1a-101, Utah Code Annotated 1953


             57          70A-1a-102, Utah Code Annotated 1953
             58          70A-1a-103, Utah Code Annotated 1953
             59          70A-1a-104, Utah Code Annotated 1953
             60          70A-1a-105, Utah Code Annotated 1953
             61          70A-1a-106, Utah Code Annotated 1953
             62          70A-1a-107, Utah Code Annotated 1953
             63          70A-1a-108, Utah Code Annotated 1953
             64          70A-1a-201, Utah Code Annotated 1953
             65          70A-1a-202, Utah Code Annotated 1953
             66          70A-1a-203, Utah Code Annotated 1953
             67          70A-1a-204, Utah Code Annotated 1953
             68          70A-1a-205, Utah Code Annotated 1953
             69          70A-1a-206, Utah Code Annotated 1953
             70          70A-1a-301, Utah Code Annotated 1953
             71          70A-1a-302, Utah Code Annotated 1953
             72          70A-1a-303, Utah Code Annotated 1953
             73          70A-1a-304, Utah Code Annotated 1953
             74          70A-1a-305, Utah Code Annotated 1953
             75          70A-1a-306, Utah Code Annotated 1953
             76          70A-1a-307, Utah Code Annotated 1953
             77          70A-1a-308, Utah Code Annotated 1953
             78          70A-1a-309, Utah Code Annotated 1953
             79          70A-1a-310, Utah Code Annotated 1953
             80      REPEALS:
             81          70A-1-101, as enacted by Chapter 154, Laws of Utah 1965
             82          70A-1-102, as enacted by Chapter 154, Laws of Utah 1965
             83          70A-1-103, as enacted by Chapter 154, Laws of Utah 1965
             84          70A-1-104, as enacted by Chapter 154, Laws of Utah 1965
             85          70A-1-105, as last amended by Chapter 252, Laws of Utah 2000
             86          70A-1-106, as enacted by Chapter 154, Laws of Utah 1965
             87          70A-1-107, as enacted by Chapter 154, Laws of Utah 1965


             88          70A-1-108, as enacted by Chapter 154, Laws of Utah 1965
             89          70A-1-109, as enacted by Chapter 154, Laws of Utah 1965
             90          70A-1-201, as last amended by Chapter 42, Laws of Utah 2006
             91          70A-1-202, as enacted by Chapter 154, Laws of Utah 1965
             92          70A-1-203, as enacted by Chapter 154, Laws of Utah 1965
             93          70A-1-204, as enacted by Chapter 154, Laws of Utah 1965
             94          70A-1-205, as enacted by Chapter 154, Laws of Utah 1965
             95          70A-1-206, as last amended by Chapter 252, Laws of Utah 2000
             96          70A-1-207, as last amended by Chapter 237, Laws of Utah 1993
             97          70A-1-208, as enacted by Chapter 154, Laws of Utah 1965
             98     
             99      Be it enacted by the Legislature of the state of Utah:
             100          Section 1. Section 11-14-501 is amended to read:
             101           11-14-501. Creation and perfection of government security interests.
             102          (1) As used in this section:
             103          (a) "Bonds" means any bond, note, lease, or other obligation of a governmental unit.
             104          (b) "Governmental unit" has the meaning assigned in [Subsection] Section
             105      70A-9a-102 [(45)].
             106          (c) "Pledge" means the creation of a security interest of any kind.
             107          (d) "Property" means any property or interests in property, other than real property.
             108          (e) "Security agreement" means any resolution, ordinance, indenture, document, or
             109      other agreement or instrument under which the revenues, fees, rents, charges, taxes, or other
             110      property are pledged to secure the bonds.
             111          (2) This section expressly governs the creation, perfection, priority, and enforcement of
             112      a security interest created by the state or a governmental unit of the state, notwithstanding
             113      anything in Title 70A, Chapter 9a, Uniform Commercial Code - Secured Transactions, to the
             114      contrary.
             115          (3) (a) The revenues, fees, rents, charges, taxes, or other property pledged by a
             116      governmental unit for the purpose of securing its bonds are immediately subject to the lien of
             117      the pledge.
             118          (b) (i) The lien is a perfected lien upon the effective date of the security agreement.


             119          (ii) The physical delivery, filing, or recording of a security agreement or financing
             120      statement under the Uniform Commercial Code or otherwise, or any other similar act, is not
             121      necessary to perfect the lien.
             122          (c) The lien of any pledge is valid, binding, perfected, and enforceable from the time
             123      the pledge is made.
             124          (d) The lien of the pledge has priority:
             125          (i) based on the time of the creation of the pledge unless otherwise provided in the
             126      security agreement; and
             127          (ii) as against all parties having claims of any kind in tort, contract, or otherwise
             128      against the governmental unit, regardless of whether or not the parties have notice of the lien.
             129          (e) Each pledge and security agreement made for the benefit or security of any of the
             130      bonds shall continue to be effective until:
             131          (i) the principal, interest, and premium, if any, on the bonds have been fully paid;
             132          (ii) provision for payment has been made; or
             133          (iii) the lien created by the security agreement has been released by agreement of the
             134      parties in interest or as provided by the security agreement that created the lien.
             135          Section 2. Section 15-8-4 is amended to read:
             136           15-8-4. Inapplicability of other laws -- Exempted transactions.
             137          (1) Rental purchase agreements that comply with this chapter are not governed by the
             138      laws relating to:
             139          (a) a security interest as defined in Subsection [ 70A-1-201 (37)] 70A-1a-201 (2)(ii); or
             140          (b) Title 70C, Utah Consumer Credit Code, except that Sections 70C-7-102 through
             141      70C-7-104 and 70C-2-205 shall apply to lessors as defined in this chapter to the same extent as
             142      they apply to creditors under Title 70C.
             143          (2) The chapter does not apply to the following:
             144          (a) rental purchase agreements primarily for business, commercial, or agricultural
             145      purposes, or those made with governmental agencies or instrumentalities or with organizations;
             146          (b) a lease of a safe deposit box;
             147          (c) a lease or bailment of personal property which is incidental to the lease of real
             148      property and which provides that the consumer has no option to purchase the leased property;
             149      or


             150          (d) a lease of a motor vehicle, as defined in Section 41-1a-102 .
             151          Section 3. Section 24-1-3 is amended to read:
             152           24-1-3. Definitions.
             153          As used in this section:
             154          (1) "Account" means the Criminal Forfeiture Restricted Account created in Section
             155      24-1-18 .
             156          (2) "Agency" means any agency of municipal, county, or state government, including
             157      law enforcement agencies, law enforcement personnel, and multi-jurisdictional task forces.
             158          (3) "Claimant" means:
             159          (a) any owner of property as defined in this section;
             160          (b) any interest holder as defined in this section; and
             161          (c) any other person or entity who asserts a claim to any property seized for forfeiture
             162      under this section.
             163          (4) "Complaint" means a civil complaint seeking the forfeiture of any real or personal
             164      property pursuant to this chapter.
             165          (5) "Constructive seizure" means a seizure of property where the property is left in the
             166      control of the owner and the seizing agency posts the property with notice of seizure by that
             167      agency for forfeiture.
             168          (6) "Contraband" means any property, item, or substance which is unlawful to produce
             169      or to possess under state or federal law.
             170          (7) (a) "Innocent owner" means an owner or interest holder who held an ownership
             171      interest in property at the time the conduct subjecting the property to seizure occurred, and:
             172          (i) did not have actual knowledge of the conduct subjecting the property to seizure; or
             173          (ii) upon learning of the conduct subjecting the property to seizure, took reasonable
             174      steps to prohibit the illegal use of the property.
             175          (b) "Innocent owner" means an owner or interest holder who acquired an ownership
             176      interest in the property and who had no knowledge that the illegal conduct subjecting the
             177      property to seizure had occurred or that the property had been seized for forfeiture, and:
             178          (i) acquired the property in a bona fide transaction for value;
             179          (ii) was a person, including a minor child, who acquired an interest in the property
             180      through probate or inheritance; or


             181          (iii) was a spouse who acquired an interest in property through dissolution of marriage
             182      or by operation of law.
             183          (8) (a) "Interest holder" means a secured party as defined in [Subsection] Section
             184      70A-9a-102 [(72)], a mortgagee, lien creditor, or the beneficiary of a security interest or
             185      encumbrance pertaining to an interest in property, whose interest would be perfected against a
             186      good faith purchaser for value.
             187          (b) "Interest holder" does not mean a person who holds property for the benefit of or as
             188      an agent or nominee for another person, or who is not in substantial compliance with any
             189      statute requiring an interest in property to be recorded or reflected in public records in order to
             190      perfect the interest against a good faith purchaser for value.
             191          (9) "Legal costs" means the costs and expenses incurred by the prosecuting agency, not
             192      to exceed 20% of the net value of the forfeited property.
             193          (10) "Legislative body" means:
             194          (a) (i) the state Legislature, county commission, county council, city commission, city
             195      council, or town council that has fiscal oversight and budgetary approval authority over a
             196      seizing agency; or
             197          (ii) the seizing agency's governing political subdivision; or
             198          (b) the lead governmental entity of a multijurisdictional task force, as designated in a
             199      memorandum of understanding executed by the agencies participating in the task force.
             200          (11) "Multijurisdictional task force" means a law enforcement task force or other
             201      agency comprised of persons who are employed by or acting under the authority of different
             202      governmental authorities, including federal, state, county or municipal governments, or any
             203      combination of these agencies.
             204          (12) "Owner" means any person or entity, other than an interest holder as defined in
             205      this section, that possesses a bona fide legal or equitable interest in real or personal property.
             206          (13) "Program" means the Crime Reduction Assistance Program created in Section
             207      24-1-19 .
             208          (14) "Property" means all property, whether real or personal, tangible or intangible.
             209          (15) "Prosecuting attorney" means:
             210          (a) the state attorney general and any assistant attorney general;
             211          (b) any district attorney or deputy district attorney; [and]


             212          (c) any county attorney or assistant county attorney; and
             213          (d) any other attorney authorized to commence an action on behalf of the state under
             214      this chapter or other provisions of state law.
             215          (16) "Seize for forfeiture" means seizure of property:
             216          (a) by a law enforcement officer or law enforcement agency, including a constructive
             217      seizure; and
             218          (b) accompanied by an assertion by the officer or agency or by a prosecuting attorney
             219      that the property is seized for forfeiture in accordance with this chapter.
             220          Section 4. Section 32A-11a-102 is amended to read:
             221           32A-11a-102. Definitions.
             222          As used in this chapter:
             223          (1) "Affected party" means a supplier or wholesaler who is a party to a distributorship
             224      agreement that a terminating party seeks to terminate or not renew.
             225          (2) (a) "Distributorship agreement" means any written contract, agreement, or
             226      arrangement between a supplier and a wholesaler pursuant to which the wholesaler has the
             227      right to purchase, resell, and distribute in a designated geographical area any brand of beer
             228      manufactured, imported, or distributed by the supplier.
             229          (b) A separate agreement between a supplier and a wholesaler that relates to the
             230      relationship between the supplier and the wholesaler or the duties of either of them under a
             231      distributorship agreement is considered to be part of the distributorship agreement for purposes
             232      of this chapter.
             233          (c) A distributorship agreement may be for a definite or indefinite period.
             234          (3) "Good cause" means the material failure by a supplier or a wholesaler to comply
             235      with an essential, reasonable, and lawful requirement imposed by a distributorship agreement if
             236      the failure occurs after the supplier or wholesaler acting in good faith provides notice of
             237      deficiency and an opportunity to correct in accordance with Sections 32A-11a-103 and
             238      32A-11a-104 .
             239          (4) "Good faith" is as defined in [Section 70A-2-103 ] Subsection 70A-1a-201 (2)(t).
             240          (5) "Retailer" means a person subject to license under Chapter 10, Beer Retailer
             241      Licenses.
             242          (6) "Sales territory" means the geographic area of distribution and sale responsibility


             243      designated by a distributorship agreement.
             244          (7) "Supplier," notwithstanding Section 32A-1-105 , means a brewer or other person
             245      who sells beer to a wholesaler for resale in this state.
             246          (8) "Terminating party" means a supplier or wholesaler who:
             247          (a) is a party to a distributorship agreement; and
             248          (b) seeks to terminate or not renew the distributorship agreement.
             249          Section 5. Section 41-1a-601 is amended to read:
             250           41-1a-601. Lien validity -- Security interest.
             251          (1) Except as provided under Subsection (2), a lien upon a vehicle, vessel, or outboard
             252      motor, except a lien dependent upon possession, is not valid against the creditors of an owner
             253      acquiring a lien by levy or attachment, or subsequent purchasers, or encumbrancers without
             254      notice until Sections 41-1a-602 through 41-1a-606 have been complied with.
             255          (2) Security interests in inventory consisting in part of vehicles subject to registration
             256      under this chapter, that are held for sale by a person in the business of selling goods of that
             257      kind, shall be perfected under Section 70A-9a-310 , except that buyers in the ordinary course of
             258      business, as defined in Section [ 70A-1-201 ] 70A-1a-201 , take free of the security interests as
             259      provided in Section 70A-9a-320 .
             260          Section 6. Section 46-4-103 is amended to read:
             261           46-4-103. Scope.
             262          (1) Except as otherwise provided in Subsection (2), this chapter applies to electronic
             263      records and electronic signatures relating to a transaction.
             264          (2) This chapter does not apply to:
             265          (a) a transaction to the extent it is governed by a law governing the creation and
             266      execution of wills, codicils, or testamentary trusts;
             267          (b) Title 70A, Uniform Commercial Code, other than:
             268          (i) [Sections 70A-1-107 and 70A-1-206 ] Section 70A-1a-306 ; and
             269          (ii) Title 70A, Chapter 2, and Title 70A, Chapter 2a.
             270          (3) This chapter applies to an electronic record or electronic signature otherwise
             271      excluded from the application of this chapter under Subsection (2) to the extent it is governed
             272      by a law other than those specified in Subsection (2).
             273          (4) A transaction subject to this chapter is also subject to other applicable substantive


             274      law.
             275          (5) Nothing in this chapter requires any county recorder to accept for recording any
             276      instrument in electronic form.
             277          Section 7. Section 46-4-403 is amended to read:
             278           46-4-403. Transferable records.
             279          (1) As used in this section, "transferable record" means an electronic record that:
             280          (a) would be a note under Title 70A, Chapter 3, Uniform Commercial Code -
             281      Negotiable Instruments, or a document under Title 70A, Chapter 7a, Uniform Commercial
             282      Code - Documents of Title, if the electronic record were in writing; and
             283          (b) the issuer of the electronic record expressly has agreed is a transferable record.
             284          (2) A person has control of a transferable record if a system employed for evidencing
             285      the transfer of interests in the transferable record reliably establishes that person as the person
             286      to which the transferable record was issued or transferred.
             287          (3) A system satisfies Subsection (2), and a person is deemed to have control of a
             288      transferable record, if the transferable record is created, stored, and assigned in such a manner
             289      that:
             290          (a) a single authoritative copy of the transferable record exists that is unique,
             291      identifiable, and, except as otherwise provided in Subsections (3)(d), (e), and (f), unalterable;
             292          (b) the authoritative copy identifies the person asserting control as:
             293          (i) the person to which the transferable record was issued; or
             294          (ii) if the authoritative copy indicates that the transferable record has been transferred,
             295      the person to which the transferable record was most recently transferred;
             296          (c) the authoritative copy is communicated to and maintained by the person asserting
             297      control or its designated custodian;
             298          (d) copies or revisions that add or change an identified assignee of the authoritative
             299      copy can be made only with the consent of the person asserting control;
             300          (e) each copy of the authoritative copy and any copy of a copy is readily identifiable as
             301      a copy that is not the authoritative copy; and
             302          (f) any revision of the authoritative copy is readily identifiable as authorized or
             303      unauthorized.
             304          (4) (a) Except as otherwise agreed, a person having control of a transferable record is


             305      the holder, as defined in Subsection [ 70A-1-201 (20)] 70A-1a-201 (2)(u), of the transferable
             306      record and has the same rights and defenses as a holder of an equivalent record or writing
             307      under Title 70A, Uniform Commercial Code, including, if the applicable statutory
             308      requirements under Subsection 70A-3-302 (1), Section 70A-7a-501 , or Section 70A-9a-308 are
             309      satisfied, the rights and defenses of a holder in due course, a holder to which a negotiable
             310      document of title has been duly negotiated, or a purchaser, respectively.
             311          (b) Delivery, possession, and indorsement are not required to obtain or exercise any of
             312      the rights under Subsection (4)(a).
             313          (5) Except as otherwise agreed, an obligor under a transferable record has the same
             314      rights and defenses as an equivalent obligor under equivalent records or writings under Title
             315      70A, Uniform Commercial Code.
             316          (6) (a) If requested by a person against which enforcement is sought, the person
             317      seeking to enforce the transferable record shall provide reasonable proof that the person is in
             318      control of the transferable record.
             319          (b) Proof may include access to the authoritative copy of the transferable record and
             320      related business records sufficient to review the terms of the transferable record and to
             321      establish the identity of the person having control of the transferable record.
             322          Section 8. Section 70A-1a-101 is enacted to read:
             323     
CHAPTER 1a. UNIFORM COMMERCIAL CODE - GENERAL PROVISIONS

             324     
Part 1. General Provisions

             325          70A-1a-101. Title.
             326          This chapter is known as the "Uniform Commercial Code - General Provisions."
             327          Section 9. Section 70A-1a-102 is enacted to read:
             328          70A-1a-102. Scope of chapter.
             329          This chapter applies to a transaction to the extent that it is governed by another chapter
             330      of this title.
             331          Section 10. Section 70A-1a-103 is enacted to read:
             332          70A-1a-103. Construction of this title to promote its purposes and policies --
             333      Applicability of supplemental principles of law.
             334          (1) This title must be liberally construed and applied to promote its underlying
             335      purposes and policies, which are:


             336          (a) to simplify, clarify, and modernize the law governing commercial transactions;
             337          (b) to permit the continued expansion of commercial practices through custom, usage,
             338      and agreement of the parties; and
             339          (c) to make uniform the law among the various jurisdictions.
             340          (2) Unless displaced by the particular provisions of this title, the principles of law and
             341      equity, including the law merchant and the law relative to capacity to contract, principal and
             342      agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, and other
             343      validating or invalidating cause supplement its provisions.
             344          Section 11. Section 70A-1a-104 is enacted to read:
             345          70A-1a-104. Construction against implied repeal.
             346          This title being a general act intended as a unified coverage of its subject matter, no part
             347      of this title shall be considered to be impliedly repealed by subsequent legislation if such
             348      construction can reasonably be avoided.
             349          Section 12. Section 70A-1a-105 is enacted to read:
             350          70A-1a-105. Severability.
             351          If any provision or clause of this title or its application to any person or circumstance is
             352      held invalid, the invalidity does not affect other provisions or applications of this title which
             353      can be given effect without the invalid provision or application, and to this end the provisions
             354      of this title are severable.
             355          Section 13. Section 70A-1a-106 is enacted to read:
             356          70A-1a-106. Use of singular and plural-- gender.
             357          In this title, unless the statutory context otherwise requires:
             358          (1) words in the singular number include the plural, and those in the plural include the
             359      singular; and
             360          (2) words of any gender also refer to any other gender.
             361          Section 14. Section 70A-1a-107 is enacted to read:
             362          70A-1a-107. Section captions.
             363          Section captions are part of this title.
             364          Section 15. Section 70A-1a-108 is enacted to read:
             365          70A-1a-108. Relation to electronic signatures in global and national commerce
             366      act.


             367          This chapter modifies, limits, and supersedes the federal Electronic Signatures in
             368      Global and National Commerce Act, 15 U.S.C. Section 7001 et seq., except that nothing in
             369      this chapter modifies, limits, or supersedes Section 7001(c) of that act or authorizes electronic
             370      delivery of any of the notices described in Section 7003(b) of that act.
             371          Section 16. Section 70A-1a-201 is enacted to read:
             372     
Part 2. General Definitions and Principles of Interpretation

             373          70A-1a-201. General definitions.
             374          (1) Unless the context otherwise requires, words or phrases defined in this section, or
             375      in the additional definitions contained in other chapters of this title that apply to particular
             376      chapters or parts thereof, have the meanings stated.
             377          (2) Subject to definitions contained in other chapters of this title that apply to particular
             378      chapters or parts thereof:
             379          (a) "Action," in the sense of a judicial proceeding, includes recoupment, counterclaim,
             380      set-off, suit in equity, and any other proceeding in which rights are determined.
             381          (b) "Aggrieved party" means a party entitled to pursue a remedy.
             382          (c) "Agreement," as distinguished from "contract," means the bargain of the parties in
             383      fact, as found in their language or inferred from other circumstances, including course of
             384      performance, course of dealing, or usage of trade as provided in Section 70A-1a-303 .
             385          (d) "Bank" means a person engaged in the business of banking and includes a savings
             386      bank, savings and loan association, credit union, and trust company.
             387          (e) "Bearer" means a person in possession of a negotiable instrument, document of
             388      title, or certificated security that is payable to bearer or indorsed in blank.
             389          (f) "Bill of lading" means a document evidencing the receipt of goods for shipment
             390      issued by a person engaged in the business of transporting or forwarding goods.
             391          (g) "Branch" includes a separately incorporated foreign branch of a bank.
             392          (h) "Burden of establishing" a fact means the burden of persuading the trier of fact that
             393      the existence of the fact is more probable than its nonexistence.
             394          (i) "Buyer in ordinary course of business" means a person that buys goods in good
             395      faith, without knowledge that the sale violates the rights of another person in the goods, and in
             396      the ordinary course from a person, other than a pawnbroker, in the business of selling goods of
             397      that kind. A person buys goods in the ordinary course if the sale to the person comports with


             398      the usual or customary practices in the kind of business in which the seller is engaged or with
             399      the seller's own usual or customary practices. A person that sells oil, gas, or other minerals at
             400      the wellhead or minehead is a person in the business of selling goods of that kind. A buyer in
             401      ordinary course of business may buy for cash, by exchange of other property, or on secured or
             402      unsecured credit, and may acquire goods or documents of title under a preexisting contract for
             403      sale. Only a buyer that takes possession of the goods or has a right to recover the goods from
             404      the seller under Chapter 2, Uniform Commercial Code - Sales, may be a buyer in ordinary
             405      course of business. "Buyer in ordinary course of business" does not include a person that
             406      acquires goods in a transfer in bulk or as security for or in total or partial satisfaction of a
             407      money debt.
             408          (j) "Conspicuous," with reference to a term, means so written, displayed, or presented
             409      that a reasonable person against which it is to operate ought to have noticed it. Whether a term
             410      is conspicuous or not is a decision for the court. Conspicuous terms include the following:
             411          (i) a heading in capitals equal to or greater in size than the surrounding text, or in
             412      contrasting type, font, or color to the surrounding text of the same or lesser size; and
             413          (ii) language in the body of a record or display in larger type than the surrounding text,
             414      or in contrasting type, font, or color to the surrounding text of the same size, or set off from
             415      surrounding text of the same size by symbols or other marks that call attention to the language.
             416          (k) "Consumer" means an individual who enters into a transaction primarily for
             417      personal, family, or household purposes.
             418          (l) "Contract," as distinguished from "agreement," means the total legal obligation that
             419      results from the parties' agreement as determined by this title as supplemented by any other
             420      applicable laws.
             421          (m) "Creditor" includes a general creditor, a secured creditor, a lien creditor, and any
             422      representative of creditors, including an assignee for the benefit of creditors, a trustee in
             423      bankruptcy, a receiver in equity, and an executor or administrator of an insolvent debtor's or
             424      assignor's estate.
             425          (n) "Defendant" includes a person in the position of defendant in a counterclaim,
             426      cross-claim, or third-party claim.
             427          (o) "Delivery," with respect to an instrument, document of title, or chattel paper, means
             428      voluntary transfer of possession.


             429          (p) "Document of title" includes bill of lading, dock warrant, dock receipt, warehouse
             430      receipt or order for the delivery of goods, and also any other document which in the regular
             431      course of business or financing is treated as adequately evidencing that the person in possession
             432      of it is entitled to receive, hold, and dispose of the document and the goods it covers. To be a
             433      document of title, a document must purport to be issued by or addressed to a bailee and purport
             434      to cover goods in the bailee's possession which are either identified or are fungible portions of
             435      an identified mass.
             436          (q) "Fault" means a default, breach, or wrongful act or omission.
             437          (r) "Fungible goods" means:
             438          (i) goods of which any unit, by nature or usage of trade, is the equivalent of any other
             439      like unit; or
             440          (ii) goods that by agreement are treated as equivalent.
             441          (s) "Genuine" means free of forgery or counterfeiting.
             442          (t) "Good faith" means honesty in fact in the conduct or transaction concerned.
             443          (u) "Holder" means:
             444          (i) the person in possession of a negotiable instrument that is payable either to bearer or
             445      to an identified person that is the person in possession; or
             446          (ii) the person in possession of a document of title if the goods are deliverable either to
             447      bearer or to the order of the person in possession.
             448          (v) "Insolvency proceeding" includes an assignment for the benefit of creditors or other
             449      proceeding intended to liquidate or rehabilitate the estate of the person involved.
             450          (w) "Insolvent" means:
             451          (i) having generally ceased to pay debts in the ordinary course of business other than as
             452      a result of bona fide dispute;
             453          (ii) being unable to pay debts as they become due; or
             454          (iii) being insolvent within the meaning of federal bankruptcy law.
             455          (x) "Money" means a medium of exchange currently authorized or adopted by a
             456      domestic or foreign government. The term includes a monetary unit of account established by
             457      an intergovernmental organization or by agreement between two or more countries.
             458          (y) "Organization" means a person other than an individual.
             459          (z) "Party," as distinguished from "third party," means a person that has engaged in a


             460      transaction or made an agreement subject to this title.
             461          (aa) "Person" means an individual, corporation, business trust, estate, trust, partnership,
             462      limited liability company, association, joint venture, government, governmental subdivision,
             463      agency, instrumentality, public corporation, or any other legal or commercial entity.
             464          (bb) "Present value" means the amount as of a date certain of one or more sums
             465      payable in the future, discounted to the date certain by use of either an interest rate specified by
             466      the parties if that rate is not manifestly unreasonable at the time the transaction is entered into
             467      or, if an interest rate is not so specified, a commercially reasonable rate that takes into account
             468      the facts and circumstances at the time the transaction is entered into.
             469          (cc) "Purchase" means taking by sale, lease, discount, negotiation, mortgage, pledge,
             470      lien, security interest, issue or reissue, gift, or any other voluntary transaction creating an
             471      interest in property.
             472          (dd) "Purchaser" means a person that takes by purchase.
             473          (ee) "Record" means information that is inscribed on a tangible medium or that is
             474      stored in an electronic or other medium and is retrievable in perceivable form.
             475          (ff) "Remedy" means any remedial right to which an aggrieved party is entitled with or
             476      without resort to a tribunal.
             477          (gg) "Representative" means a person empowered to act for another, including an
             478      agent, an officer of a corporation or association, and a trustee, executor, or administrator of an
             479      estate.
             480          (hh) "Right" includes remedy.
             481          (ii) "Security interest" means an interest in personal property or fixtures which secures
             482      payment or performance of an obligation. "Security interest" includes any interest of a
             483      consignor and a buyer of accounts, chattel paper, a payment intangible, or a promissory note in
             484      a transaction that is subject to Chapter 9a, Uniform Commercial Code - Secured Transactions.
             485      "Security interest" does not include the special property interest of a buyer of goods on
             486      identification of those goods to a contract for sale under Section 70A-2-401 , but a buyer may
             487      also acquire a "security interest" by complying with Chapter 9a, Uniform Commercial Code -
             488      Secured Transactions. Except as otherwise provided in Section 70A-2-505 , the right of a seller
             489      or lessor of goods under Chapter 2, Uniform Commercial Code - Sales, or 2A, Uniform
             490      Commercial Code - Leases, to retain or acquire possession of the goods is not a "security


             491      interest," but a seller or lessor may also acquire a "security interest" by complying with Chapter
             492      9a, Uniform Commercial Code - Secured Transactions. The retention or reservation of title by
             493      a seller of goods notwithstanding shipment or delivery to the buyer under Section 70A-2-401 is
             494      limited in effect to a reservation of a "security interest." Whether a transaction in the form of a
             495      lease creates a "security interest" is determined pursuant to Section 70A-1a-203 .
             496          (jj) "Send" in connection with a writing, record, or notice means:
             497          (i) to deposit in the mail or deliver for transmission by any other usual means of
             498      communication with postage or cost of transmission provided for and properly addressed and,
             499      in the case of an instrument, to an address specified thereon or otherwise agreed, or if there be
             500      none to any address reasonable under the circumstances; or
             501          (ii) in any other way to cause to be received any record or notice within the time it
             502      would have arrived if properly sent.
             503          (kk) "Signed" includes using any symbol executed or adopted with present intention to
             504      adopt or accept a writing.
             505          (ll) "State" means a state of the United States, the District of Columbia, Puerto Rico,
             506      the United States Virgin Islands, or any territory or insular possession subject to the jurisdiction
             507      of the United States.
             508          (mm) "Surety" includes a guarantor or other secondary obligor.
             509          (nn) "Term" means a portion of an agreement that relates to a particular matter.
             510          (oo) "Unauthorized signature" means a signature made without actual, implied, or
             511      apparent authority. The term includes a forgery.
             512          (pp) "Warehouse receipt" means a receipt issued by a person engaged in the business of
             513      storing goods for hire.
             514          (qq) "Writing" includes printing, typewriting, or any other intentional reduction to
             515      tangible form. "Written" has a corresponding meaning.
             516          Section 17. Section 70A-1a-202 is enacted to read:
             517          70A-1a-202. Notice -- Knowledge.
             518          (1) Subject to Subsection (6), a person has "notice" of a fact if the person:
             519          (a) has actual knowledge of it;
             520          (b) has received a notice or notification of it; or
             521          (c) from all the facts and circumstances known to the person at the time in question,


             522      has reason to know that it exists.
             523          (2) "Knowledge" means actual knowledge. "Knows" has a corresponding meaning.
             524          (3) "Discover," "learn," or words of similar import refer to knowledge rather than to
             525      reason to know.
             526          (4) A person "notifies" or "gives" a notice or notification to another person by taking
             527      such steps as may be reasonably required to inform the other person in ordinary course,
             528      whether or not the other person actually comes to know of it.
             529          (5) Subject to Subsection (6), a person "receives" a notice or notification when:
             530          (a) it comes to that person's attention; or
             531          (b) it is duly delivered in a form reasonable under the circumstances at the place of
             532      business through which the contract was made or at another location held out by that person as
             533      the place for receipt of such communications.
             534          (6) Notice, knowledge, or a notice or notification received by an organization is
             535      effective for a particular transaction from the time it is brought to the attention of the individual
             536      conducting that transaction and, in any event, from the time it would have been brought to the
             537      individual's attention if the organization had exercised due diligence. An organization
             538      exercises due diligence if it maintains reasonable routines for communicating significant
             539      information to the person conducting the transaction and there is reasonable compliance with
             540      the routines. Due diligence does not require an individual acting for the organization to
             541      communicate information unless the communication is part of the individual's regular duties or
             542      the individual has reason to know of the transaction and that the transaction would be
             543      materially affected by the information.
             544          Section 18. Section 70A-1a-203 is enacted to read:
             545          70A-1a-203. Lease distinguished from security interest.
             546          (1) Whether a transaction in the form of a lease creates a lease or security interest is
             547      determined by the facts of each case.
             548          (2) A transaction in the form of a lease creates a security interest if the consideration
             549      that the lessee is to pay the lessor for the right to possession and use of the goods is an
             550      obligation for the term of the lease and is not subject to termination by the lessee, and:
             551          (a) the original term of the lease is equal to or greater than the remaining economic life
             552      of the goods;


             553          (b) the lessee is bound to renew the lease for the remaining economic life of the goods
             554      or is bound to become the owner of the goods;
             555          (c) the lessee has an option to renew the lease for the remaining economic life of the
             556      goods for no additional consideration or for nominal additional consideration upon compliance
             557      with the lease agreement; or
             558          (d) the lessee has an option to become the owner of the goods for no additional
             559      consideration or for nominal additional consideration upon compliance with the lease
             560      agreement.
             561          (3) A transaction in the form of a lease does not create a security interest merely
             562      because:
             563          (a) the present value of the consideration the lessee is obligated to pay the lessor for the
             564      right to possession and use of the goods is substantially equal to or is greater than the fair
             565      market value of the goods at the time the lease is entered into;
             566          (b) the lessee assumes risk of loss of the goods;
             567          (c) the lessee agrees to pay, with respect to the goods, taxes, insurance, filing,
             568      recording, or registration fees, or service or maintenance costs;
             569          (d) the lessee has an option to renew the lease or to become the owner of the goods;
             570          (e) the lessee has an option to renew the lease for a fixed rent that is equal to or greater
             571      than the reasonably predictable fair market rent for the use of the goods for the term of the
             572      renewal at the time the option is to be performed; or
             573          (f) the lessee has an option to become the owner of the goods for a fixed price that is
             574      equal to or greater than the reasonably predictable fair market value of the goods at the time the
             575      option is to be performed.
             576          (4) Additional consideration is nominal if it is less than the lessee's reasonably
             577      predictable cost of performing under the lease agreement if the option is not exercised.
             578      Additional consideration is not nominal if:
             579          (a) when the option to renew the lease is granted to the lessee, the rent is stated to be
             580      the fair market rent for the use of the goods for the term of the renewal determined at the time
             581      the option is to be performed; or
             582          (b) when the option to become the owner of the goods is granted to the lessee, the price
             583      is stated to be the fair market value of the goods determined at the time the option is to be


             584      performed.
             585          (5) The "remaining economic life of the goods" and "reasonably predictable" fair
             586      market rent, fair market value, or cost of performing under the lease agreement must be
             587      determined with reference to the facts and circumstances at the time the transaction is entered
             588      into.
             589          Section 19. Section 70A-1a-204 is enacted to read:
             590          70A-1a-204. Value.
             591          Except as otherwise provided in Chapters 3, Uniform Commercial Code - Negotiable
             592      Instruments, 4, Uniform Commercial Code - Bank Deposits and Collections, and 5, Uniform
             593      Commercial Code - Letters of Credit, a person gives value for rights if the person acquires
             594      them:
             595          (1) in return for a binding commitment to extend credit or for the extension of
             596      immediately available credit, whether or not drawn upon and whether or not a charge-back is
             597      provided for in the event of difficulties in collection;
             598          (2) as security for, or in total or partial satisfaction of, a preexisting claim;
             599          (3) by accepting delivery under a preexisting contract for purchase; or
             600          (4) in return for any consideration sufficient to support a simple contract.
             601          Section 20. Section 70A-1a-205 is enacted to read:
             602          70A-1a-205. Reasonable time -- Seasonableness.
             603          (1) Whether a time for taking an action required by this title is reasonable depends on
             604      the nature, purpose, and circumstances of the action.
             605          (2) An action is taken seasonably if it is taken at or within the time agreed or, if no time
             606      is agreed, at or within a reasonable time.
             607          Section 21. Section 70A-1a-206 is enacted to read:
             608          70A-1a-206. Presumptions.
             609          Whenever this title creates a "presumption" with respect to a fact, or provides that a fact
             610      is "presumed," the trier of fact must find the existence of the fact unless and until evidence is
             611      introduced that supports a finding of its nonexistence.
             612          Section 22. Section 70A-1a-301 is enacted to read:
             613     
Part 3. Territorial Applicability and General Rules

             614          70A-1a-301. Territorial applicability -- Parties' power to choose applicable law.


             615          (1) Except as provided in this section, when a transaction bears a reasonable relation to
             616      this state and also to another state or nation, the parties may agree that the law either of this
             617      state or of such other state or nation shall govern their rights and duties. Failing such
             618      agreement, this title applies to transactions bearing an appropriate relation to this state.
             619          (2) Where one of the following provisions of this title specifies the applicable law, that
             620      provision governs and a contrary agreement is effective only to the extent permitted by the law,
             621      including the conflict of laws rules, so specified:
             622          (a) rights of creditors against sold goods under Section 70A-2-402 ;
             623          (b) applicability of the chapter on leases under Sections 70A-2a-105 and 70A-2a-106 ;
             624          (c) applicability of the chapter on bank deposits and collections under Section
             625      70A-4-102 ;
             626          (d) applicability of the chapter on letters of credit under Section 70A-5-116 ;
             627          (e) applicability of the chapter on investment securities under Section 70A-8-109 ; or
             628          (f) law governing perfection, the effect of perfection or nonperfection, and the priority
             629      of security interests and agricultural liens under Sections 70A-9a-301 through 70A-9a-307 .
             630          Section 23. Section 70A-1a-302 is enacted to read:
             631          70A-1a-302. Variation by agreement.
             632          (1) Except as otherwise provided in Subsection (2) or elsewhere in this title, the effect
             633      of provisions of this title may be varied by agreement.
             634          (2) The obligations of good faith, diligence, reasonableness, and care prescribed by this
             635      title may not be disclaimed by agreement. The parties, by agreement, may determine the
             636      standards by which the performance of those obligations is to be measured if those standards
             637      are not manifestly unreasonable. Whenever this title requires an action to be taken within a
             638      reasonable time, a time that is not manifestly unreasonable may be fixed by agreement.
             639          (3) The presence in certain provisions of this title of the phrase "unless otherwise
             640      agreed," or words of similar import, does not imply that the effect of other provisions may not
             641      be varied by agreement under this section.
             642          Section 24. Section 70A-1a-303 is enacted to read:
             643          70A-1a-303. Course of performance, course of dealing, and usage of trade.
             644          (1) A "course of performance" is a sequence of conduct between the parties to a
             645      particular transaction that exists if:


             646          (a) the agreement of the parties with respect to the transaction involves repeated
             647      occasions for performance by a party; and
             648          (b) the other party, with knowledge of the nature of the performance and opportunity
             649      for objection to it, accepts the performance or acquiesces in it without objection.
             650          (2) A "course of dealing" is a sequence of conduct concerning previous transactions
             651      between the parties to a particular transaction that is fairly to be regarded as establishing a
             652      common basis of understanding for interpreting their expressions and other conduct.
             653          (3) A "usage of trade" is any practice or method of dealing having such regularity of
             654      observance in a place, vocation, or trade as to justify an expectation that it will be observed
             655      with respect to the transaction in question. The existence and scope of such a usage must be
             656      proved as facts. If it is established that such a usage is embodied in a trade code or similar
             657      record, the interpretation of the record is a question of law.
             658          (4) A course of performance or course of dealing between the parties or usage of trade
             659      in the vocation or trade in which they are engaged or of which they are or should be aware is
             660      relevant in ascertaining the meaning of the parties' agreement, may give particular meaning to
             661      specific terms of the agreement, and may supplement or qualify the terms of the agreement. A
             662      usage of trade applicable in the place in which part of the performance under the agreement is
             663      to occur may be so utilized as to that part of the performance.
             664          (5) Except as otherwise provided in Subsection (6), the express terms of an agreement
             665      and any applicable course of performance, course of dealing, or usage of trade must be
             666      construed whenever reasonable as consistent with each other. If such a construction is
             667      unreasonable:
             668          (a) express terms prevail over course of performance, course of dealing, and usage of
             669      trade;
             670          (b) course of performance prevails over course of dealing and usage of trade; and
             671          (c) course of dealing prevails over usage of trade.
             672          (6) Subject to Section 70A-2-209 , a course of performance is relevant to show a waiver
             673      or modification of any term inconsistent with the course of performance.
             674          (7) Evidence of a relevant usage of trade offered by one party is not admissible unless
             675      that party has given the other party notice that the court finds sufficient to prevent unfair
             676      surprise to the other party.


             677          Section 25. Section 70A-1a-304 is enacted to read:
             678          70A-1a-304. Obligation of good faith.
             679          Every contract or duty within this title imposes an obligation of good faith in its
             680      performance and enforcement.
             681          Section 26. Section 70A-1a-305 is enacted to read:
             682          70A-1a-305. Remedies to be liberally administered.
             683          (1) The remedies provided by this title must be liberally administered to the end that
             684      the aggrieved party may be put in as good a position as if the other party had fully performed
             685      but neither consequential or special damages nor penal damages may be had except as
             686      specifically provided in this title or by other rule of law.
             687          (2) Any right or obligation declared by this title is enforceable by action unless the
             688      provision declaring it specifies a different and limited effect.
             689          Section 27. Section 70A-1a-306 is enacted to read:
             690          70A-1a-306. Waiver or renunciation of claim or right after breach.
             691          A claim or right arising out of an alleged breach may be discharged in whole or in part
             692      without consideration by agreement of the aggrieved party in an authenticated record.
             693          Section 28. Section 70A-1a-307 is enacted to read:
             694          70A-1a-307. Prima facie evidence by third-party documents.
             695          A document in due form purporting to be a bill of lading, policy or certificate of
             696      insurance, official weigher's or inspector's certificate, consular invoice, or any other document
             697      authorized or required by the contract to be issued by a third party is prima facie evidence of its
             698      own authenticity and genuineness and of the facts stated in the document by the third party.
             699          Section 29. Section 70A-1a-308 is enacted to read:
             700          70A-1a-308. Performance or acceptance under reservation of rights.
             701          (1) A party that with explicit reservation of rights performs or promises performance or
             702      assents to performance in a manner demanded or offered by the other party does not thereby
             703      prejudice the rights reserved. Such words as "without prejudice," "under protest," or the like
             704      are sufficient.
             705          (2) Subsection (1) does not apply to an accord and satisfaction.
             706          Section 30. Section 70A-1a-309 is enacted to read:
             707          70A-1a-309. Option to accelerate at will.


             708          A term providing that one party or that party's successor in interest may accelerate
             709      payment or performance or require collateral or additional collateral "at will" or when the party
             710      "considers itself insecure," or words of similar import, means that the party has power to do so
             711      only if that party in good faith believes that the prospect of payment or performance is
             712      impaired. The burden of establishing lack of good faith is on the party against which the power
             713      has been exercised.
             714          Section 31. Section 70A-1a-310 is enacted to read:
             715          70A-1a-310. Subordinated obligations.
             716          An obligation may be issued as subordinated to performance of another obligation of
             717      the person obligated, or a creditor may subordinate its right to performance of an obligation by
             718      agreement with either the person obligated or another creditor of the person obligated.
             719      Subordination does not create a security interest as against either the common debtor or a
             720      subordinated creditor.
             721          Section 32. Section 70A-2-103 is amended to read:
             722           70A-2-103. Definitions and index of definitions.
             723          (1) In this chapter unless the context otherwise requires:
             724          (a) "Buyer" means a person who buys or contracts to buy goods.
             725          (b) "Good faith" in the case of a merchant means honesty in fact and the observance of
             726      reasonable commercial standards of fair dealing in the trade.
             727          (c) "Receipt" of goods means taking physical possession of them.
             728          (d) "Seller" means a person who sells or contracts to sell goods.
             729          (2) Other definitions applying to this chapter or to specified parts thereof, and the
             730      sections in which they appear are:
             731          (a) "Acceptance." Section 70A-2-606 .
             732          (b) "Banker's credit." Section 70A-2-325 .
             733          (c) "Between merchants." Section 70A-2-104 .
             734          (d) "Cancellation." Subsection 70A-2-106 (4).
             735          (e) "Commercial unit." Section 70A-2-105 .
             736          (f) "Confirmed credit." Section 70A-2-325 .
             737          (g) "Conforming to contract." Section 70A-2-106 .
             738          (h) "Contract for sale." Section 70A-2-106 .


             739          (i) "Cover." Section 70A-2-712 .
             740          (j) "Entrusting." Section 70A-2-403 .
             741          (k) "Financing agency." Section 70A-2-104 .
             742          (l) "Future goods." Section 70A-2-105 .
             743          (m) "Goods." Section 70A-2-105 .
             744          (n) "Identification." Section 70A-2-501 .
             745          (o) "Installment contract." Section 70A-2-612 .
             746          (p) "Letter of Credit." Section 70A-2-325 .
             747          (q) "Lot." Section 70A-2-105 .
             748          (r) "Merchant." Section 70A-2-104 .
             749          (s) "Overseas." Section 70A-2-323 .
             750          (t) "Person in position of seller." Section 70A-2-707 .
             751          (u) "Present sale." Section 70A-2-106 .
             752          (v) "Sale." Section 70A-2-106 .
             753          (w) "Sale on approval." Section 70A-2-326 .
             754          (x) "Sale or return." Section 70A-2-326 .
             755          (y) "Termination." Section 70A-2-106 .
             756          (3) "Control" as provided in Section 70A-7a-106 , and the following definitions in other
             757      chapters apply to this chapter:
             758          (a) "Check." Section 70A-3-104 .
             759          (b) "Consignee." Section 70A-7a-102 .
             760          (c) "Consignor." Section 70A-7a-102 .
             761          (d) "Consumer goods." Section 70A-9a-102 .
             762          (e) "Dishonor." Section 70A-3-502 .
             763          (f) "Draft." Section 70A-3-104 .
             764          (4) In addition, Chapter [1] 1a, Uniform Commercial Code - General Provisions,
             765      contains general definitions and principles of construction and interpretation applicable
             766      throughout this chapter.
             767          Section 33. Section 70A-2-202 is amended to read:
             768           70A-2-202. Final written expression -- Parol or extrinsic evidence.
             769          Terms with respect to which the confirmatory memoranda of the parties agree or which


             770      are otherwise set forth in a writing intended by the parties as a final expression of their
             771      agreement with respect to such terms as are included therein may not be contradicted by
             772      evidence of any prior agreement or of a contemporaneous oral agreement but may be explained
             773      or supplemented:
             774          [(a)] (1) by course of performance, course of dealing, or usage of trade (Section
             775      [ 70A-1-205 ] 70A-1a-303 ) or by course of performance (Section 70A-2-208 ); and
             776          [(b)] (2) by evidence of consistent additional terms unless the court finds the writing to
             777      have been intended also as a complete and exclusive statement of the terms of the agreement.
             778          Section 34. Section 70A-2a-103 is amended to read:
             779           70A-2a-103. Definitions -- Index of definitions.
             780          (1) In this chapter, unless the context otherwise requires:
             781          (a) "Buyer in ordinary course of business" means a person, who in good faith and
             782      without knowledge that the sale to him is in violation of the ownership rights or security
             783      interest or leasehold interest of a third party in the goods, buys in ordinary course from a person
             784      in the business of selling goods of that kind, but does not include a pawnbroker. "Buying" may
             785      be for cash or by exchange of other property or on secured or unsecured credit and includes
             786      acquiring goods or documents of title under a preexisting contract for sale, but does not include
             787      a transfer in bulk, or as security for, or in total or partial satisfaction of a money debt.
             788          (b) "Cancellation" occurs when either party puts an end to the lease contract for default
             789      by the other party.
             790          (c) "Commercial unit" means a unit of goods which by commercial usage is a single
             791      whole for purposes of lease, and the division of which materially impairs its character or value
             792      on the market or in use. A commercial unit may be a single article, such as a machine, or a set
             793      of articles, such as a suite of furniture or a line of machinery, or a quantity, such as a gross or
             794      carload, or any other unit treated in use or in the relevant market as a single whole.
             795          (d) "Conforming goods or performance under a lease contract" means goods or
             796      performance that are in accordance with the obligations under the lease contract.
             797          (e) "Consumer lease" means a lease that a lessor, regularly engaged in the business of
             798      leasing or selling, makes to a lessee, who is an individual and who takes under the lease
             799      primarily for a personal, family, or household purpose.
             800          (f) "Fault" means wrongful act, omission, breach, or default.


             801          (g) "Finance lease" means a lease in which:
             802          (i) the lessor does not select, manufacture, or supply the goods;
             803          (ii) the lessor acquires the goods or the right to possession and use of the goods in
             804      connection with the lease; and
             805          (iii) one of the following occurs:
             806          (A) the lessee receives a copy of the contract by which the lessor acquired the goods or
             807      the right to possession and use of the goods before signing the lease contract;
             808          (B) the lessee's approval of the contract by which the lessor acquired the goods or the
             809      right to possession and use of the goods is a condition to effectiveness of the lease contract;
             810          (C) the lessee, before signing the lease contract, receives an accurate and complete
             811      statement designating the promises and warranties, and any disclaimers of warranties,
             812      limitations, or modifications of remedies, or liquidated damages, including those of a third
             813      party, such as the manufacturer of the goods, provided to the lessor by the person supplying the
             814      goods in connection with or as part of the contract by which the lessor acquired the goods or
             815      the right to possession and use of the goods; or
             816          (D) if the lease is not a consumer lease, the lessor, before the lessee signs the lease
             817      contract, informs the lessee in writing:
             818          (I) of the identity of the person supplying the goods to the lessor, unless the lessee has
             819      selected that person and directed the lessor to acquire the goods or the right to possession and
             820      use of the goods from that person;
             821          (II) that the lessee is entitled under this chapter to the promises and warranties,
             822      including those of any third party, provided to the lessor by the person supplying the goods in
             823      connection with or as part of the contract by which the lessor acquired the goods or the right to
             824      possession and use of the goods; and
             825          (III) that the lessee may communicate with the person supplying the goods to the lessor
             826      and receive an accurate and complete statement of those promises and warranties, including
             827      any disclaimers and limitations of them or of remedies.
             828          (h) "Goods" means all things that are movable at the time of identification to the lease
             829      contract, or are fixtures. The term does not include money, documents, instruments, accounts,
             830      chattel paper, general intangibles, or minerals or the like, including oil and gas, before
             831      extraction. The term also includes the unborn young of animals.


             832          (i) "Installment lease contract" means a lease contract that authorizes or requires the
             833      delivery of goods in separate lots to be separately accepted, even though the lease contract
             834      contains a clause stating "each delivery is a separate lease" or its equivalent.
             835          (j) "Lease" means a transfer of the right to possession and use of goods for a term, in
             836      return for consideration. Unless the context clearly indicates otherwise, the term includes a
             837      sublease. But a sale, including a sale on approval or a sale or return, or retention or creation of
             838      a security interest is not a lease.
             839          (k) "Lease agreement" with respect to the lease, means the bargain of the lessor and the
             840      lessee in fact as found in their language or by implication from other circumstances including
             841      course of dealing or usage of trade or course of performance as provided in this chapter.
             842      Unless the context clearly indicates otherwise, the term includes a sublease agreement.
             843          (l) "Lease contract" means the total legal obligation that results from the lease
             844      agreement as affected by this chapter and any other applicable rules of law. Unless the context
             845      clearly indicates otherwise, the term includes a sublease contract.
             846          (m) "Leasehold interest" means the interest of the lessor or the lessee under a lease
             847      contract.
             848          (n) "Lessee" means a person who acquires the right to possession and use of goods
             849      under a lease. Unless the context clearly indicates otherwise, the term includes a sublessee.
             850          (o) "Lessee in ordinary course of business" means a person who in good faith and
             851      without knowledge that the lease to him is in violation of the ownership rights, security
             852      interest, or leasehold interest of a third party in the goods, leases in ordinary course from a
             853      person in the business of selling or leasing goods of that kind, but does not include a
             854      pawnbroker. "Leasing" may be for cash or by exchange of other property, or on secured or
             855      unsecured credit, and includes acquiring goods or documents of title under a preexisting lease
             856      contract. "Leasing" does not include a transfer in bulk or as security for or in total or partial
             857      satisfaction of a money debt.
             858          (p) "Lessor" means a person who transfers the right to possession and use of goods
             859      under a lease. Unless the context clearly indicates otherwise, the term includes a sublessor.
             860          (q) "Lessor's residual interest" means the lessor's interest in the goods after expiration,
             861      termination, or cancellation of the lease contract.
             862          (r) "Lien" means a charge against or interest in goods to secure payment of a debt or


             863      performance of an obligation, but the term does not include a security interest.
             864          (s) "Lot" means a parcel or single article that is the subject matter of a separate lease or
             865      delivery, whether or not it is sufficient to perform the lease contract.
             866          (t) "Merchant lessee" means a lessee that is a merchant with respect to goods of the
             867      kind subject to the lease.
             868          (u) "Present value" means the amount as of a date certain of one or more sums payable
             869      in the future, discounted to the date certain. The discount is determined by the interest rate
             870      specified by the parties if the rate was not manifestly unreasonable at the time the transaction
             871      was entered into; otherwise, the discount is determined by a commercially reasonable rate that
             872      takes into account the facts and circumstances of each case at the time the transaction was
             873      entered into.
             874          (v) "Purchase" includes taking by sale, lease, mortgage, security interest, pledge, gift,
             875      or any other voluntary transaction creating an interest in goods.
             876          (w) "Sublease" means a lease of goods, the right to possession and use of which was
             877      acquired by the lessor as a lessee under an existing lease.
             878          (x) "Supplier" means a person from whom a lessor buys or leases goods to be leased
             879      under a finance lease.
             880          (y) "Supply contract" means a contract under which a lessor buys or leases goods to be
             881      leased.
             882          (z) "Termination" occurs when either party, pursuant to a power created by agreement
             883      or law, puts an end to the lease contract otherwise than for default.
             884          (2) Other definitions applying to this chapter and the sections in which they appear are:
             885          (a) "Accessions," Section 70A-2a-310 [;].
             886          (b) "Construction mortgage," Section 70A-2a-309 [;].
             887          (c) "Encumbrance," Section 70A-2a-309 [;].
             888          (d) "Fixtures," Section 70A-2a-309 [;].
             889          (e) "Fixture filing," Section 70A-2a-309 [; and].
             890          (f) "Purchase money lease," Section 70A-2a-309 .
             891          (3) The following definitions in other chapters apply to this chapter:
             892          (a) "Account," Subsection 70A-9a-102 (2)[;].
             893          (b) "Between merchants," Section 70A-2-104 [;].


             894          (c) "Buyer," Section 70A-2-103 [;].
             895          (d) "Chattel paper," Subsection 70A-9a-102 (11)[;].
             896          (e) "Consumer goods," Subsection 70A-9a-102 (23)[;].
             897          (f) "Document," Subsection 70A-9a-102 (30)[;].
             898          (g) "Entrusting," Section 70A-2-403 [;].
             899          (h) "General intangible," Subsection 70A-9a-102 (42)[;].
             900          (i) "Good faith," Section 70A-2-103 ;
             901          (j) "Instrument," Subsection 70A-9a-102 [(47);](46).
             902          (k) "Merchant," Section 70A-2-104 [;].
             903          (l) "Mortgage," Subsection 70A-9a-102 [(55);](54).
             904          (m) "Pursuant to commitment," Subsection 70A-9a-102 [(68);](67).
             905          (n) "Receipt," Section 70A-2-103 [;].
             906          (o) "Sale," Section 70A-2-106 [;].
             907          (p) "Sale on approval," Section 70A-2-326 [;].
             908          (q) "Sale or return," Section 70A-2-326 [; and].
             909          (r) "Seller," Section 70A-2-103 .
             910          (4) In addition, Title 70A, Chapter [1] 1a, Uniform Commercial Code - General
             911      Provisions, contains general definitions and principles of construction and interpretation
             912      applicable throughout this chapter.
             913          Section 35. Section 70A-2a-501 is amended to read:
             914           70A-2a-501. Default -- Procedure.
             915          (1) Whether the lessor or the lessee is in default under a lease contract is determined by
             916      the lease agreement and this chapter.
             917          (2) If the lessor or the lessee is in default under the lease contract, the party seeking
             918      enforcement has rights and remedies as provided in this chapter and, except as limited by this
             919      chapter, as provided in the lease agreement.
             920          (3) If the lessor or the lessee is in default under the lease contract, the party seeking
             921      enforcement may reduce the party's claim to judgment, or otherwise enforce the lease contract
             922      by self-help or any available judicial procedure or nonjudicial procedure, including
             923      administrative proceeding, arbitration, or the like, in accordance with this chapter.
             924          (4) Except as otherwise provided in [Section 70A-1-106 ] Subsection 70A-1a-305 (1), in


             925      this chapter, or in the lease agreement, the rights and remedies referred to in Subsections (2)
             926      and (3) are cumulative.
             927          (5) If the lease agreement covers both real property and goods, the party seeking
             928      enforcement may proceed under this section as to the goods, or under other applicable law as to
             929      both the real property and the goods in accordance with that person's rights and remedies in
             930      respect of the real property, in which case this section does not apply.
             931          Section 36. Section 70A-2a-518 is amended to read:
             932           70A-2a-518. Cover -- Substitute goods.
             933          (1) After default by a lessor under the lease contract of the type described in Section
             934      70A-2a-508 , or if agreed after other default by the lessor, the lessee may cover by making any
             935      purchase or lease of or contract to purchase or lease goods in substitution for those due from
             936      the lessor.
             937          (2) Except as otherwise provided with respect to damages liquidated in the lease
             938      agreement as provided in Section 70A-2a-504 or otherwise determined pursuant to agreement
             939      of the parties as provided in [Subsection 70A-1-102 (3) and Section] Sections 70A-1a-302 and
             940      70A-2a-503 , if a lessee's cover is by lease agreement substantially similar to the original lease
             941      agreement and the lease agreement is made in good faith and in a commercially reasonable
             942      manner, the lessee may recover from the lessor as damages:
             943          (a) the present value, as of the date of the commencement of the term of the new lease
             944      agreement, of the rent under the new lease agreement applicable to that period of the new lease
             945      term that is comparable to the then remaining term of the original lease agreement, minus the
             946      present value as of the same date of the total rent for the then remaining lease term of the
             947      original lease agreement; and
             948          (b) any incidental or consequential damages less expenses saved in consequence of the
             949      lessor's default.
             950          (3) If a lessee's cover is by lease agreement that qualifies for treatment under
             951      Subsection (2), the lessee may elect to proceed under Subsection (2) or Section 70A-2a-519 . If
             952      a lessee's cover is by lease agreement that for any reason does not qualify for treatment under
             953      Subsection (2), or is by purchase or otherwise, the lessee may recover from the lessor under
             954      Section 70A-2a-519 as if the lessee had elected not to cover.
             955          Section 37. Section 70A-2a-519 is amended to read:


             956           70A-2a-519. Lessee's damages for nondelivery, repudiation, default, and breach
             957      of warranty in regard to accepted goods.
             958          (1) Except as otherwise provided with respect to damages liquidated in the lease
             959      agreement as provided in Section 70A-2a-504 or otherwise determined pursuant to agreement
             960      of the parties as provided in [Subsection 70A-1-102 (3) and Section] Sections 70A-1a-302 and
             961      70A-2a-503 , if a lessee elects not to cover or a lessee elects to cover and the cover is by lease
             962      agreement whether or not the lease agreement qualifies for treatment under Subsection
             963      70A-2a-518 (2), or is by purchase or otherwise, the measure of damages for default by the
             964      lessor under Section 70A-2a-508 is the present value, as of the date of the default, of the then
             965      market rent minus the present value as of the same date of the original rent, computed for the
             966      remaining lease term of the original lease agreement together with incidental and consequential
             967      damages, less expenses saved in consequence of the lessor's default.
             968          (2) Market rent is to be determined as of the place for tender or, in cases of rejection
             969      after arrival or revocation of acceptance, as of the place of arrival.
             970          (3) Except as otherwise agreed, if the lessee has accepted goods and given notification
             971      as provided in Subsection 70A-2a-516 (3), the measure of damages for nonconforming tender
             972      or delivery or other default by a lessor is the loss resulting in the ordinary course of events from
             973      the lessor's default as determined in any manner that is reasonable together with incidental and
             974      consequential damages, less expenses saved in consequence of the lessor's default.
             975          (4) Except as otherwise agreed, the measure of damages for breach of warranty is the
             976      present value at the time and place of acceptance of the difference between the value of the use
             977      of the goods accepted and the value if they had been as warranted for the lease term, unless
             978      special circumstances show proximate damages of a different amount, together with incidental
             979      and consequential damages, less expenses saved in consequence of the lessor's default or
             980      breach of warranty.
             981          Section 38. Section 70A-2a-527 is amended to read:
             982           70A-2a-527. Lessor's rights to dispose of goods.
             983          (1) After a default by a lessee under the lease contract of the type described in Section
             984      70A-2a-523 or after the lessor refuses to deliver or takes possession of goods as provided in
             985      Section 70A-2a-525 or 70A-2a-526 , or if agreed, after other default by a lessee, the lessor may
             986      dispose of the goods concerned or the undelivered balance thereof by lease, sale, or otherwise.


             987          (2) Except as otherwise provided with respect to damages liquidated in the lease
             988      agreement as provided in Section 70A-2a-504 or otherwise determined pursuant to agreement
             989      of the parties as provided in [Subsection 70A-1-102 (3) and Section] Sections 70A-1a-302 and
             990      70A-2a-503 , if the disposition is by lease agreement substantially similar to the original lease
             991      agreement and the lease agreement is made in good faith and in a commercially reasonable
             992      manner, the lessor may recover from the lessee as damages:
             993          (a) accrued and unpaid rent as of the date of the commencement of the term of the new
             994      lease agreement;
             995          (b) the present value, as of the date of the commencement of the term of the new lease
             996      agreement, of the difference between the total rent for the then remaining lease term of the
             997      original lease agreement minus the present value, as of the same date, of the rent under the new
             998      lease agreement applicable to that period of the new lease term which is comparable to the then
             999      remaining term of the original lease agreement; and
             1000          (c) any incidental damages allowed under Section 70A-2a-530 , less expenses saved in
             1001      consequence of the lessee's default.
             1002          (3) If the lessor's disposition is by lease agreement that qualifies for treatment under
             1003      Subsection (2), the lessor may elect to proceed under Subsection (2) or Section 70A-2a-528 . If
             1004      the lessor's disposition is by lease agreement that for any reason does not qualify for treatment
             1005      under Subsection (2), or is by sale or otherwise, the lessor may recover from the lessee under
             1006      Section 70A-2a-528 as if the lessor had elected not to dispose of the goods.
             1007          (4) A subsequent buyer or lessee who buys or leases from the lessor in good faith for
             1008      value as a result of a disposition under this section takes the goods free of the original lease
             1009      contract and any rights of the original lessee even though the lessor fails to comply with one or
             1010      more of the requirements of this chapter.
             1011          (5) The lessor is not accountable to the lessee for any profit made on any disposition.
             1012      A lessee who has rightfully rejected or justifiably revoked acceptance shall account to the
             1013      lessor for any excess over the amount of the lessee's security interest as provided in Subsection
             1014      70A-2a-508 (5).
             1015          Section 39. Section 70A-2a-528 is amended to read:
             1016           70A-2a-528. Lessor's damages for nonacceptance, failure to pay, repudiation, or
             1017      other default.


             1018          (1) Except as otherwise provided with respect to damages liquidated in the lease
             1019      agreement as provided in Section 70A-2a-504 or otherwise determined pursuant to agreement
             1020      of the parties as provided in [Subsection 70A-1-102 (3) and Section] Sections 70A-1a-302 and
             1021      70A-2a-503 , if a lessor elects to retain the goods or a lessor elects to dispose of the goods and
             1022      the disposition is by lease agreement whether or not the lease agreement qualifies for treatment
             1023      under Subsection 70A-2a-527 (2), or is by sale or otherwise, the lessor may recover from the
             1024      lessee as damages for a default of the type described in Section 70A-2a-523 or, if agreed, for
             1025      any other default of the lessee:
             1026          (a) accrued and unpaid rent as of the date of default if the lessee has never taken
             1027      possession of the goods, or, if the lessee has taken possession of the goods, as of the date on
             1028      which the lessee makes a tender of the goods to the lessor;
             1029          (b) the present value as of the date determined under Subsection (1)(a) of default of the
             1030      total rent for the then remaining lease term of the original lease agreement and minus the
             1031      present value as of the same date of the market rent at the place where the goods are located
             1032      computed for the same lease term; and
             1033          (c) any incidental damages allowed under Section 70A-2a-530 , less expenses saved in
             1034      consequence of the lessee's default.
             1035          (2) If the measure of damages provided in Subsection (1) is inadequate to put a lessor
             1036      in as good a position as performance would have, the measure of damages is the present value
             1037      of the profit, including reasonable overhead, the lessor would have made from full performance
             1038      by the lessee, together with any incidental damages allowed under Section 70A-2a-530 , due
             1039      allowance for costs reasonably incurred and due credit for payments or proceeds of disposition.
             1040          Section 40. Section 70A-3-103 is amended to read:
             1041           70A-3-103. Definitions.
             1042          (1) In this chapter:
             1043          (a) "Acceptor" means a drawee who has accepted a draft.
             1044          (b) "Drawee" means a person ordered in a draft to make payment.
             1045          (c) "Drawer" means a person who signs or is identified in a draft as a person ordering
             1046      payment.
             1047          (d) "Good faith" means honesty in fact in the conduct or transaction concerned.
             1048          (e) "Maker" means a person who signs or is identified in a note as a person undertaking


             1049      to pay.
             1050          (f) "Order" means a written instruction to pay money signed by the person giving the
             1051      instruction. The instruction may be addressed to any person, including the person giving the
             1052      instruction, or to one or more persons jointly or in the alternative, but not in succession. An
             1053      authorization to pay is not an order unless the person authorized to pay is also instructed to pay.
             1054          (g) "Ordinary care" in the case of a person engaged in business means observance of
             1055      reasonable commercial standards, prevailing in the area in which the person is located, with
             1056      respect to the business in which the person is engaged. In the case of a bank that takes an
             1057      instrument for processing for collection or payment by automated means, reasonable
             1058      commercial standards do not require the bank to examine the instrument if the failure to
             1059      examine does not violate the bank's prescribed procedures and the bank's procedures do not
             1060      vary unreasonably from general banking usage not disapproved by this chapter or Title 70A,
             1061      Chapter 4, Uniform Commercial Code -[-] Bank Deposits and Collections.
             1062          (h) "Party" means a party to an instrument.
             1063          (i) "Promise" means a written undertaking to pay money signed by the person
             1064      undertaking to pay. An acknowledgment of an obligation by the obligor is not a promise
             1065      unless the obligor also undertakes to pay the obligation.
             1066          (j) "Prove" with respect to a fact means to meet the burden of establishing the fact as
             1067      defined in Subsection [ 70A-1-201 (8)] 70A-1a-201 (2)(h).
             1068          (k) "Remitter" means a person who purchases an instrument from its issuer if the
             1069      instrument is payable to an identified person other than the purchaser.
             1070          (2) Other definitions applying to this chapter and the sections in which they appear are:
             1071          (a) "Acceptance," Section 70A-3-409 [;].
             1072          (b) "Accommodated party," Section 70A-3-419 [;].
             1073          (c) "Accommodation party," Section 70A-3-419 [;].
             1074          (d) "Alteration," Section 70A-3-407 [;].
             1075          (e) "Anomalous indorsement," Section 70A-3-205 [;].
             1076          (f) "Blank indorsement," Section 70A-3-205 [;].
             1077          (g) "Cashier's check," Section 70A-3-104 [;].
             1078          (h) "Certificate of deposit," Section 70A-3-104 [;].
             1079          (i) "Certified check," Section 70A-3-409 [;].


             1080          (j) "Check," Section 70A-3-104 [;].
             1081          (k) "Consideration," Section 70A-3-303 [;].
             1082          (l) "Demand draft," Section 70A-3-104 [ 7;].
             1083          (m) "Draft," Section 70A-3-104 [;].
             1084          (n) "Holder in due course," Section 70A-3-302 [;].
             1085          (o) "Incomplete instrument," Section 70A-3-115 [;].
             1086          (p) "Indorsement," Section 70A-3-204 [;].
             1087          (q) "Indorser," Section 70A-3-204 [;].
             1088          (r) "Instrument," Section 70A-3-104 [;].
             1089          (s) "Issue," Section 70A-3-105 [;].
             1090          (t) "Issuer," Section 70A-3-105 [;].
             1091          (u) "Negotiable instrument," Section 70A-3-104 [;].
             1092          (v) "Negotiation," Section 70A-3-201 [;].
             1093          (w) "Note," Section 70A-3-104 [;].
             1094          (x) "Payable at a definite time," Section 70A-3-108 [;].
             1095          (y) "Payable on demand," Section 70A-3-108 [;].
             1096          (z) "Payable to bearer," Section 70A-3-109 [;].
             1097          (aa) "Payable to order," Section 70A-3-109 [;].
             1098          (bb) "Payment," Section 70A-3-602 [;].
             1099          (cc) "Person entitled to enforce," Section 70A-3-301 [;].
             1100          (dd) "Presentment," Section 70A-3-501 [;].
             1101          (ee) "Reacquisition," Section 70A-3-207 [;].
             1102          (ff) "Special indorsement," Section 70A-3-205 [;].
             1103          (gg) "Teller's check," Section 70A-3-104 [;].
             1104          (hh) "Transfer of instrument," Section 70A-3-203 [;].
             1105          (ii) "Traveler's check," Section 70A-3-104 [;].
             1106          (jj) "Value," Section 70A-3-303 .
             1107          (3) The following definitions in other chapters apply to this chapter:
             1108          (a) "Bank," Section 70A-4-105 [;].
             1109          (b) "Banking day," Section 70A-4-104 [;].
             1110          (c) "Clearinghouse," Section 70A-4-104 [;].


             1111          (d) "Collecting bank," Section 70A-4-105 [;].
             1112          (e) "Depositary bank," Section 70A-4-105 [;].
             1113          (f) "Documentary draft," Section 70A-4-104 [;].
             1114          (g) "Intermediary bank," Section 70A-4-105 [;].
             1115          (h) "Item," Section 70A-4-104 [;].
             1116          (i) "Payor bank," Section 70A-4-105 [;].
             1117          (j) "Suspends payments," Section 70A-4-104 .
             1118          (4) In addition, Chapter [1] 1a, Uniform Commercial Code - General Provisions,
             1119      contains general definitions and principles of construction and interpretation applicable
             1120      throughout this chapter.
             1121          Section 41. Section 70A-4-104 is amended to read:
             1122           70A-4-104. Definitions and index of definitions.
             1123          (1) In this chapter, unless the context otherwise requires:
             1124          (a) "Account" means any deposit or credit account with a bank including a demand,
             1125      time, savings, passbook, share draft, or similar account, other than the account evidenced by a
             1126      certificate of deposit.
             1127          (b) "Afternoon" means the period of a day between noon and midnight.
             1128          (c) "Banking day" means the part of a day on which a bank is open to the public for
             1129      carrying on substantially all of its banking functions other than a Saturday, a Sunday, or a legal
             1130      holiday.
             1131          (d) "Clearinghouse" means an association of banks or other payors regularly clearing
             1132      items.
             1133          (e) "Customer" means a person having an account with a bank or for whom a bank has
             1134      agreed to collect items including a bank that maintains an account at another bank.
             1135          (f) "Documentary draft" means a draft to be presented for acceptance or payment if
             1136      specified documents, certificated securities as provided in Section 70A-8-101 , instructions for
             1137      uncertificated securities as provided in Section 70A-8-101 , other certificates, statements, or the
             1138      like are to be received by the drawee or other payor before acceptance or payment of the draft.
             1139          (g) "Draft" means a draft as defined in Section 70A-3-104 or an item, other than an
             1140      instrument, that is an order.
             1141          (h) "Drawee" means a person ordered in a draft to make payment.


             1142          (i) "Item" means an instrument or a promise or order to pay money handled by a bank
             1143      for collection or payment. The term does not include a payment order governed by [Title 70A,]
             1144      Chapter [4A] 4a, Uniform Commercial Code - Funds Transfers, or a credit or debit card slip.
             1145          (j) "Midnight deadline" with respect to a bank is midnight on its next banking day
             1146      following the banking day on which it receives the relevant item or notice or from which the
             1147      time for taking action commences to run, whichever is later.
             1148          (k) "Settle" means to pay in cash, by clearinghouse settlement, in a charge or credit or
             1149      by remittance, or otherwise as agreed. A settlement may be either provisional or final.
             1150          (l) "Suspends payments" with respect to a bank means that it has been closed by order
             1151      of the supervisory authorities, that a public officer has been appointed to take it over or that it
             1152      ceases or refuses to make payments in the ordinary course of business.
             1153          (2) Other definitions applying to this chapter and the sections in which they appear are:
             1154          (a) "Agreement for electronic presentment," Section 70A-4-110 [;].
             1155          (b) "Bank," Section 70A-4-105 [;].
             1156          (c) "Collecting bank," Section 70A-4-105 [;].
             1157          (d) "Depositary bank," Section 70A-4-105 [;].
             1158          (e) "Intermediary bank," Section 70A-4-105 [;].
             1159          (f) "Payor bank," Section 70A-4-105 [;].
             1160          (g) "Presenting bank," Section 70A-4-105 [; and];
             1161          (h) "Presentment notice," Section 70A-4-110 .
             1162          (3) "Control" as provided in Section 70A-7a-106 and the following definitions in other
             1163      chapters apply to this chapter:
             1164          (a) "Acceptance," Section 70A-3-409 [;].
             1165          (b) "Alteration," Section 70A-3-407 [;].
             1166          (c) "Cashier's check," Section 70A-3-104 [;].
             1167          (d) "Certificate of deposit," Section 70A-3-104 [;].
             1168          (e) "Certified check," Section 70A-3-409 [;].
             1169          (f) "Check," Section 70A-3-104 [;].
             1170          (g) "Good faith," Section 70A-3-103 ;
             1171          (h) "Holder in due course," Section 70A-3-302 [;].
             1172          (i) "Instrument," Section 70A-3-104 [;].


             1173          (j) "Notice of dishonor," Section 70A-3-503 [;].
             1174          (k) "Order," Section 70A-3-103 [;].
             1175          (l) "Ordinary care," Section 70A-3-103 [;].
             1176          (m) "Person entitled to enforce," Section 70A-3-301 [;].
             1177          (n) "Presentment," Section 70A-3-501 [;].
             1178          (o) "Promise," Section 70A-3-103 [;].
             1179          (p) "Prove," Section 70A-3-103 [;].
             1180          (q) "Teller's check," Section 70A-3-104 [; and].
             1181          (r) "Unauthorized signature," Section 70A-3-403 .
             1182          (4) In addition, Chapter [1,] 1a, Uniform Commercial Code - General Provisions,
             1183      contains general definitions and principles of construction and interpretation applicable
             1184      throughout this chapter.
             1185          Section 42. Section 70A-4a-105 is amended to read:
             1186           70A-4a-105. Other definitions.
             1187          (1) In this chapter:
             1188          (a) "Authorized account" means a deposit account of a customer in a bank designated
             1189      by the customer as a source of payment orders issued by the customer to the bank. If a
             1190      customer does not so designate an account, any account of the customer is an authorized
             1191      account if payment of a payment order from that account is not inconsistent with a restriction
             1192      on the use of that account.
             1193          (b) "Bank" means a person engaged in the business of banking, and includes a savings
             1194      bank, savings and loan association, credit union, and trust company. A branch or separate
             1195      office of a bank is a separate bank for purposes of this chapter.
             1196          (c) "Customer" means a person, including a bank, having an account with a bank or
             1197      from whom a bank has agreed to receive payment orders.
             1198          (d) "Funds transfer business day" of a receiving bank means the part of a day during
             1199      which the receiving bank is open for the receipt, processing, and transmittal of payment orders
             1200      and cancellations and amendments of payment orders.
             1201          (e) "Funds transfer system" means a wire transfer network, automated clearing house,
             1202      or other communication system of a clearing house or other association of banks through which
             1203      a payment order by a bank may be transmitted to the bank to which the order is addressed.


             1204          (f) "Good faith" means honesty in fact and the observance of reasonable commercial
             1205      standards of fair dealing.
             1206          (g) "Prove" with respect to a fact means to meet the burden of establishing the fact
             1207      under Subsection [ 70A-1-201 (8)] 70A-1a-201 (2)(h).
             1208          (2) Other definitions applying to this chapter and the sections in which they appear are:
             1209          (a) "Acceptance," Section 70A-4a-209 [;].
             1210          (b) "Beneficiary," Section 70A-4a-103 [;].
             1211          (c) "Beneficiary's bank," Section 70A-4a-103 [;].
             1212          (d) "Executed," Section 70A-4a-301 [;].
             1213          (e) "Execution date," Section 70A-4a-301 [;].
             1214          (f) "Funds transfer system rule," Section 70A-4a-501 [;].
             1215          (g) "Funds transfer," Section 70A-4a-104 [;].
             1216          (h) "Intermediary bank," Section 70A-4a-104 [;].
             1217          (i) "Originator," Section 70A-4a-104 [;].
             1218          (j) "Originator's bank," Section 70A-4a-104 [;].
             1219          (k) "Payment by beneficiary's bank to beneficiary," Section 70A-4a-405 [;].
             1220          (l) "Payment by originator to beneficiary," Section 70A-4a-406 [;].
             1221          (m) "Payment by sender, to receiving bank," Section 70A-4a-403 [;].
             1222          (n) "Payment date," Section 70A-4a-401 [;].
             1223          (o) "Payment order," Section 70A-4a-103 [;].
             1224          (p) "Receiving bank," Section 70A-4a-103 [;].
             1225          (q) "Security procedure," Section 70A-4a-201 [; and].
             1226          (r) "Sender," Section 70A-4a-103 .
             1227          (3) The following definitions in Chapter 4, Uniform Commercial Code - Bank
             1228      Deposits and Collections, apply to this chapter:
             1229          (a) "Clearinghouse," Section 70A-4-104 [;].
             1230          (b) "Item," Section 70A-4-104 [; and].
             1231          (c) "Suspends payments," Section 70A-4-104 .
             1232          (4) In addition, [Title 70A,] Chapter [1] 1a, Uniform Commercial Code [-]- General
             1233      Provisions, contains general definitions and principles of construction and interpretation
             1234      applicable throughout this chapter.


             1235          Section 43. Section 70A-4a-106 is amended to read:
             1236           70A-4a-106. Time payment order is received.
             1237          (1) The time of receipt of a payment order or communication canceling or amending a
             1238      payment order is determined by the rules applicable to receipt of a notice stated in [Subsection
             1239      70A-1-201 (27)] Section 70A-1a-202 . A receiving bank may fix a cutoff time or times on a
             1240      funds transfer business day, as a cutoff time for the receipt and processing of payment orders
             1241      and communications canceling or amending payment orders. Different cutoff times may apply
             1242      to receipt of payment orders, cancellations, or amendments, or to different categories of
             1243      payment orders, cancellations, or amendments. A cutoff time may apply to senders generally
             1244      or different cutoff times may apply to different senders or categories of payment orders. If a
             1245      payment order or communication canceling or amending a payment order is received after the
             1246      close of a funds transfer business day or after the appropriate cutoff time on a funds transfer
             1247      business day, the receiving bank may treat the payment order or communication as received at
             1248      the opening of the next funds transfer business day.
             1249          (2) If this chapter refers to an execution date or payment date or states a day on which a
             1250      receiving bank is required to take any action, and the date or day does not fall on a funds
             1251      transfer business day, the next day that is a funds transfer business day is treated as the date or
             1252      day stated, unless the contrary is stated in this chapter.
             1253          Section 44. Section 70A-4a-204 is amended to read:
             1254           70A-4a-204. Refund of payment and duty of customer to report with respect to
             1255      unauthorized payment order.
             1256          (1) (a) If a receiving bank accepts a payment order issued in the name of its customer
             1257      as sender which is not authorized and not effective as the order of the customer under Section
             1258      70A-4a-202 , or not enforceable, in whole or in part, against the customer under Section
             1259      70A-4a-203 , the bank shall refund any payment of the payment order received from the
             1260      customer to the extent the bank is not entitled to enforce payment, and shall pay interest on the
             1261      refundable amount calculated from the date the bank received payment to the date of the
             1262      refund.
             1263          (b) However, the customer is not entitled to interest from the bank on the amount to be
             1264      refunded if the customer fails to exercise ordinary care to determine that the order was not
             1265      authorized by the customer and to notify the bank of the relevant facts within a reasonable time


             1266      not exceeding 90 days after the date the customer received notification from the bank that the
             1267      order was accepted or that the customer's account was debited with respect to the order.
             1268          (c) The bank is not entitled to any recovery from the customer on account of a failure
             1269      by the customer to give notification as stated in this section.
             1270          (2) Reasonable time under Subsection (1) may be fixed by agreement as stated in
             1271      Subsection [ 70A-1-204 (1)] 70A-1a-302 (2), but the obligation of a receiving bank to refund
             1272      payment as stated in Subsection (1) may not otherwise be varied by agreement.
             1273          Section 45. Section 70A-5-103 is amended to read:
             1274           70A-5-103. Scope.
             1275          (1) This chapter applies to letters of credit and to certain rights and obligations arising
             1276      out of transactions involving letters of credit.
             1277          (2) The statement of a rule in this chapter does not by itself require, imply, or negate
             1278      application of the same or a different rule to a situation not provided for, or to a person not
             1279      specified, in this chapter.
             1280          (3) With the exception of this Subsection (3), Subsections (1) and (4), Subsections
             1281      70A-5-102 (9) and (10), 70A-5-106 (4), and 70A-5-114 (4), and except to the extent prohibited
             1282      in [Subsections 70A-1-102 (3)] Section 70A-1a-302 and Subsection 70A-5-117 (4), the effect of
             1283      this chapter may be varied by agreement or by a provision stated or incorporated by reference
             1284      in an undertaking. A term in an agreement or undertaking generally excusing liability or
             1285      generally limiting remedies for failure to perform obligations is not sufficient to vary
             1286      obligations prescribed by this chapter.
             1287          (4) Rights and obligations of an issuer to a beneficiary or a nominated person under a
             1288      letter of credit are independent of the existence, performance, or nonperformance of a contract
             1289      or arrangement out of which the letter of credit arises or which underlies it, including contracts
             1290      or arrangements between the issuer and the applicant and between the applicant and the
             1291      beneficiary.
             1292          Section 46. Section 70A-7a-102 is amended to read:
             1293           70A-7a-102. Definitions and index of definitions.
             1294          (1) In this chapter, unless the context otherwise requires:
             1295          (a) "Bailee" means a person that by a warehouse receipt, bill of lading, or other
             1296      document of title acknowledges possession of goods and contracts to deliver them.


             1297          (b) "Carrier" means a person that issues a bill of lading.
             1298          (c) "Consignee" means a person named in a bill of lading to which or to whose order
             1299      the bill promises delivery.
             1300          (d) "Consignor" means a person named in a bill of lading as the person from which the
             1301      goods have been received for shipment.
             1302          (e) "Delivery order" means a record that contains an order to deliver goods directed to a
             1303      warehouse, carrier, or other person that in the ordinary course of business issues warehouse
             1304      receipts or bills of lading.
             1305          (f) "Good faith" means honesty in fact and the observance of reasonable commercial
             1306      standards of fair dealing.
             1307          (g) "Goods" means all things that are treated as movable for the purposes of a contract
             1308      for storage or transportation.
             1309          (h) "Issuer" means a bailee that issues a document of title or, in the case of an
             1310      unaccepted delivery order, the person that orders the possessor of goods to deliver. The term
             1311      includes a person for which an agent or employee purports to act in issuing a document if the
             1312      agent or employee has real or apparent authority to issue documents, even if the issuer did not
             1313      receive any goods, the goods were misdescribed, or in any other respect the agent or employee
             1314      violated the issuer's instructions.
             1315          (i) "Person entitled under the document" means the holder, in the case of a negotiable
             1316      document of title, or the person to which delivery of the goods is to be made by the terms of, or
             1317      pursuant to instructions in a record under, a nonnegotiable document of title.
             1318          (j) "Record" means information that is inscribed on a tangible medium or that is stored
             1319      in an electronic or other medium and is retrievable in perceivable form.
             1320          (k) "Shipper" means a person that enters into a contract of transportation with a carrier.
             1321          (l) "Sign" means, with present intent to authenticate or adopt a record:
             1322          (i) to execute or adopt a tangible symbol; or
             1323          (ii) to attach to or logically associate with the record an electronic sound, symbol, or
             1324      process.
             1325          (m) "Warehouse" means a person engaged in the business of storing goods for hire.
             1326          (2) Definitions in other chapters applying to this chapter and the sections in which they
             1327      appear are:


             1328          (a) "Contract for sale," Section 70A-2-106 .
             1329          (b) "Lessee in the ordinary course of business," Section 70A-2a-103 .
             1330          (c) "Receipt" of goods, Section 70A-2-103 .
             1331          (3) In addition, Chapter [1,] 1a, Uniform Commercial Code - General Provisions,
             1332      contains general definitions and principles of construction and interpretation applicable
             1333      throughout this chapter.
             1334          Section 47. Section 70A-8-101 is amended to read:
             1335           70A-8-101. Definitions.
             1336          (1) As used in this chapter:
             1337          (a) "Adverse claim" means a claim that a claimant has a property interest in a financial
             1338      asset and that it is a violation of the rights of the claimant for another person to hold, transfer,
             1339      or deal with the financial asset.
             1340          (b) "Bearer form," as applied to a certificated security, means a form in which the
             1341      security is payable to the bearer of the security certificate according to its terms but not by
             1342      reason of an indorsement.
             1343          (c) "Broker" means a person defined as a broker or dealer under the federal securities
             1344      laws, but without excluding a bank acting in that capacity.
             1345          (d) "Certificated security" means a security that is represented by a certificate.
             1346          (e) "Clearing corporation" means:
             1347          (i) a person that is registered as a "clearing agency" under the federal securities laws;
             1348          (ii) a federal reserve bank; or
             1349          (iii) any other person that provides clearance or settlement services with respect to
             1350      financial assets that would require it to register as a clearing agency under the federal securities
             1351      laws but for an exclusion or exemption from the registration requirement, if its activities as a
             1352      clearing corporation, including promulgation of rules, are subject to regulation by a federal or
             1353      state governmental authority.
             1354          (f) "Communicate" means to:
             1355          (i) send a signed writing; or
             1356          (ii) transmit information by any mechanism agreed upon by the persons transmitting
             1357      and receiving the information.
             1358          (g) "Entitlement holder" means a person identified in the records of a securities


             1359      intermediary as the person having a security entitlement against the securities intermediary. If
             1360      a person acquired a security entitlement by virtue of Subsection 70A-8-501 (2)(b) or (c), that
             1361      person is the entitlement holder.
             1362          (h) "Entitlement order" means a notification communicated to a securities intermediary
             1363      directing transfer or redemption of a financial asset to which the entitlement holder has a
             1364      security entitlement.
             1365          (i) (i) "Financial asset," except as otherwise provided in Section 70A-8-102 , means:
             1366          (A) a security;
             1367          (B) an obligation of a person or a share, participation, or other interest in a person or in
             1368      property or an enterprise of a person, which is or is of a type, dealt in or traded on financial
             1369      markets, or which is recognized in any area in which it is issued or dealt in as a medium for
             1370      investment; or
             1371          (C) any property that is held by a securities intermediary for another person in a
             1372      securities account if that securities intermediary has expressly agreed with the other person that
             1373      the property is to be treated as a financial asset under this chapter.
             1374          (ii) As context requires, the term means either the interest itself or the means by which
             1375      a person's claim to it is evidenced, including a certificated or uncertificated security, a security
             1376      certificate, or a security entitlement.
             1377          (j) "Good faith," for purposes of the obligation of good faith in the performance or
             1378      enforcement of contracts or duties within this chapter, means honesty in fact and the
             1379      observance of reasonable commercial standards of fair dealing.
             1380          (k) "Indorsement" means a signature that alone or accompanied by other words is made
             1381      on a security certificate in registered form or on a separate document for the purpose of
             1382      assigning, transferring, or redeeming the security or granting a power to assign, transfer, or
             1383      redeem it.
             1384          (l) "Instruction" means a notification communicated to the issuer of an uncertificated
             1385      security which directs that the transfer of the security be registered or that the security be
             1386      redeemed.
             1387          (m) "Registered form," as applied to a certificated security, means a form in which:
             1388          (i) the security certificate specifies a person entitled to the security; and
             1389          (ii) a transfer of the security may be registered upon books maintained for that purpose


             1390      by or on behalf of the issuer, or the security certificate so states.
             1391          (n) "Securities intermediary" means:
             1392          (i) a clearing corporation; or
             1393          (ii) a person, including a bank or broker, that in the ordinary course of its business
             1394      maintains securities accounts for others and is acting in that capacity.
             1395          [(o)] (n) "Security," except as otherwise provided in Section 70A-8-102 , means an
             1396      obligation of an issuer or a share, participation, or other interest in an issuer or in property or an
             1397      enterprise of an issuer:
             1398          (i) which is represented by a security certificate in bearer or registered form, or the
             1399      transfer of which may be registered upon books maintained for that purpose by or on behalf of
             1400      the issuer;
             1401          (ii) which is one of a class or series or by its terms is divisible into a class or series of
             1402      shares, participations, interests, or obligations; and
             1403          (iii) which:
             1404          (A) is, or is of a type, dealt in or traded on securities exchanges or securities markets;
             1405      or
             1406          (B) is a medium for investment and by its terms expressly provides that it is a security
             1407      governed by this chapter.
             1408          (p) "Security certificate" means a certificate representing a security.
             1409          (q) "Security entitlement" means the rights and property interest of an entitlement
             1410      holder with respect to a financial asset specified in Part 5.
             1411          (r) "Uncertificated security" means a security that is not represented by a certificate.
             1412          (2) Other definitions applying to this chapter and the sections in which they appear are:
             1413          (a) "Appropriate person," Section 70A-8-106 [;].
             1414          (b) "Control," Section 70A-8-105 [;].
             1415          (c) "Delivery," Section 70A-8-301 [;].
             1416          (d) "Investment company security," Section 70A-8-102 [;].
             1417          (e) "Issuer," Section 70A-8-201 [;].
             1418          (f) "Overissue," Section 70A-8-210 [;].
             1419          (g) "Protected purchaser," Section 70A-8-303 [; and].
             1420          (h) "Securities account," Section 70A-8-501 .


             1421          (3) In addition, Chapter [1,] 1a, Uniform Commercial Code - General Provisions,
             1422      contains general definitions and principles of construction and interpretation applicable
             1423      throughout this chapter.
             1424          (4) The characterization of a person, business, or transaction for purposes of this
             1425      chapter does not determine the characterization of the person, business, or transaction for
             1426      purposes of any other law, regulation, or rule.
             1427          Section 48. Section 70A-9a-102.1 is amended to read:
             1428           70A-9a-102.1. Definitions from other chapters.
             1429          (1) "Control" as provided in Section 70A-7a-106 and the following definitions in other
             1430      chapters of this title apply to this chapter:
             1431          (a) "Applicant" Section 70A-5-102 .
             1432          (b) "Beneficiary" Section 70A-5-102 .
             1433          (c) "Broker" Section 70A-8-101 .
             1434          (d) "Certificated security" Section 70A-8-101 .
             1435          (e) "Check" Section 70A-3-104 .
             1436          (f) "Clearing corporation" Section 70A-8-101 .
             1437          (g) "Contract for sale" Section 70A-2-106 .
             1438          (h) "Customer" Section 70A-4-104 .
             1439          (i) "Entitlement holder" Section 70A-8-101 .
             1440          (j) "Financial asset" Section 70A-8-101 .
             1441          (k) "Holder in due course" Section 70A-3-302 .
             1442          (l) (i) "Issuer" (with respect to a letter of credit or letter-of-credit right) Section
             1443      70A-5-102 .
             1444          (ii) "Issuer" (with respect to a security) Section 70A-8-201 .
             1445          (iii) "Issuer" (with respect to documents of title) Section 70A-7a-102 .
             1446          (m) "Lease" Section 70A-2a-103 .
             1447          (n) "Lease agreement" Section 70A-2a-103 .
             1448          (o) "Lease contract" Section 70A-2a-103 .
             1449          (p) "Leasehold interest" Section 70A-2a-103 .
             1450          (q) "Lessee" Section 70A-2a-103 .
             1451          (r) "Lessee in ordinary course of business" Section 70A-2a-103 .


             1452          (s) "Lessor" Section 70A-2a-103 .
             1453          (t) "Lessor's residual interest" Section 70A-2a-103 .
             1454          (u) "Letter of credit" Section 70A-5-102 .
             1455          (v) "Merchant" Section 70A-2-104 .
             1456          (w) "Negotiable instrument" Section 70A-3-104 .
             1457          (x) "Nominated person" Section 70A-5-102 .
             1458          (y) "Note" Section 70A-3-104 .
             1459          (z) "Proceeds of a letter of credit" Section 70A-5-114 .
             1460          (aa) "Prove" Section 70A-3-103 .
             1461          (bb) "Sale" Section 70A-2-106 .
             1462          (cc) "Securities account" Section 70A-8-501 .
             1463          (dd) "Securities intermediary" Section 70A-8-101 .
             1464          (ee) "Security" Section 70A-8-101 .
             1465          (ff) "Security certificate" Section 70A-8-101 .
             1466          (gg) "Security entitlement" Section 70A-8-101 .
             1467          (hh) "Uncertificated security" Section 70A-8-101 .
             1468          (2) Chapter [1,] 1a, Uniform Commercial Code - General Provisions, contains general
             1469      definitions and principles of construction and interpretation applicable throughout this chapter.
             1470          Section 49. Section 70A-10-104 is amended to read:
             1471           70A-10-104. Laws not repealed.
             1472          Chapter 7a, Uniform Commercial Code - Documents of Title, does not repeal or modify
             1473      any laws prescribing the form or contents of documents of title or the services or facilities to be
             1474      afforded by bailees, or otherwise regulating bailees' businesses in respects not specifically dealt
             1475      with herein; but the fact that such laws are violated does not affect the status of a document of
             1476      title which otherwise complies with the definition of a document of title as defined in Section
             1477      [ 70A-1-201 ] 70A-1a-201 .
             1478          Section 50. Section 70C-2-204 is amended to read:
             1479           70C-2-204. Certain negotiable instruments prohibited.
             1480          With respect to a consumer credit sale not involving real property, the seller may not
             1481      take a negotiable instrument under Section 70A-3-104 other than a check as evidence of the
             1482      obligation of the buyer. A holder is not in good faith under Subsection [ 70A-1-201 (19)]


             1483      70A-1a-201 (2)(t) if he takes a negotiable instrument with notice that it is issued in violation of
             1484      this section. A holder in due course under Section 70A-3-302 is not subject to the liabilities set
             1485      forth in the provisions on the effect of violations on rights of parties under Section 70C-7-201 .
             1486          Section 51. Repealer.
             1487          This bill repeals:
             1488          Section 70A-1-101, Short title.
             1489          Section 70A-1-102, Purposes -- Rules of construction -- Variation by agreement.
             1490          Section 70A-1-103, Supplementary general principles of law applicable.
             1491          Section 70A-1-104, Construction against implicit repeal.
             1492          Section 70A-1-105, Territorial application of title -- Parties' power to choose
             1493      applicable law.
             1494          Section 70A-1-106, Remedies to be liberally administered.
             1495          Section 70A-1-107, Waiver or renunciation of claim or right after breach.
             1496          Section 70A-1-108, Severability.
             1497          Section 70A-1-109, Section captions.
             1498          Section 70A-1-201, General definitions.
             1499          Section 70A-1-202, Prima facie evidence by third-party documents.
             1500          Section 70A-1-203, Obligation of good faith.
             1501          Section 70A-1-204, Time -- Reasonable time -- "Seasonably."
             1502          Section 70A-1-205, Course of dealing and usage of trade.
             1503          Section 70A-1-206, Statute of frauds for kinds of personal property not otherwise
             1504      covered.
             1505          Section 70A-1-207, Performance or acceptance under reservation of rights.
             1506          Section 70A-1-208, Option to accelerate at will.


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