§ 36-9-507 — Effect of certain events on effectiveness of financing statement.

(a) A filed financing statement remains effective with respect to collateral that is sold, exchanged, leased, licensed, or otherwise disposed of and in which a security interest or agricultural lien continues, even if the secured party knows of or consents to the disposition. (b) Except as otherwise provided in subsection (c) and Section 36-9-508, a financing statement is not rendered ineffective if, after the financing statement is filed, the information provided in the financing statement becomes seriously misleading under Section 36-9-506. (c) If the name that a filed financing statement provides for a debtor becomes insufficient as the name of the debtor pursuant to Section 36-9-503(a) so that the financing statement becomes seriously misleading pursuant to Section 36-9-506: (1) the financing statement is effective to perfect a security interest in collateral acquired by the debtor before, or within four months after, the filed financing statement becomes seriously misleading; and (2) the financing statement is not effective to perfect a security interest in collateral acquired by the debtor more than four months after the filed financing statement becomes seriously misleading, unless an amendment to the financing statement which renders the financing statement not seriously misleading is filed within four months after the financing statement became seriously misleading.

Legislative History

HISTORY: 1962 Code SECTION 10.9-507; 1966 (54) 2716; 1988 Act No. 494, SECTION 5; 2001 Act No. 67, SECTION 12; 2013 Act No. 96, SECTION 13, eff July 1, 2013. Effect of Amendment The 2013 amendment rewrote subsection (c).