30 KAR 5:040. UCC Information Management System.

      RELATES TO: KRS 355.9-515, 355.9-519, 355.9-526

      STATUTORY AUTHORITY: KRS 355.9-526(1)

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 355.9-526(1) requires the Secretary of State to promulgate administrative regulations implementing Article 9 of KRS Chapter 355. This administrative regulation establishes the requirements for the UCC Information Management System.

      Section 1. General Provisions. The Information Management System shall:

      (1) Be used by the filing officer to store, index, and retrieve information relating to financing statements;

      (2) Include an index of the names of debtors named on the financing statements which have not lapsed; and

      (3) Comply with the requirements of this administrative regulation.

      Section 2. Primary Data Elements. The primary data elements used in the UCC Information Management System shall be the following:

      (1) Identification numbers.

      (a) Each initial financing statement shall be identified by its file number, which shall be stamped on written UCC records or otherwise permanently associated with the record maintained for UCC records in the UCC Information Management System. A record shall be created in the Information Management System for each initial financing statement and all information comprising the record shall be maintained in the system. The record shall be identified by the same information assigned to the initial financing statement.

      (b) A UCC record other than an initial financing statement shall be identified by a unique file number assigned by the filing officer. In the Information Management System, records of all UCC records other than initial financing statements shall be linked to the record of their related initial financing statement.

      (2) Type of record. The type of UCC record from which data is transferred shall be identified in the Information Management System from information supplied by the remitter.

      (3) Filing date and filing time. The filing date and filing time of UCC records shall be stored in the Information Management System. Calculation of the lapse date of an initial financing statement shall be based upon the filing date and in accordance with KRS 355.9-515.

      (4) Identification of parties. The names and addresses of debtors and secured parties shall be transferred from UCC records to the UCC Information Management System using one (1) or more data entry or transmittal techniques.

      (5) Status of financing statement. In the Information Management System, each financing statement shall list a status of active or inactive.

      (6) Lapse indicator. An indicator shall be maintained by which the Information Management System identifies whether or not a financing statement will lapse and, if it does, when it will lapse.

      Section 3. Names of Debtors or Secured Parties Who are Individuals.

      (1) Individual name fields. The names of individuals shall be stored in files that include only the names of individuals, and not the names of organizations. Separate data entry fields shall be established for first (given), middle (given), and last names (surnames or family names) of individuals. A filer shall place the name of a debtor with a single name (e.g., Cher) in the last name field. The filing officer shall:

      (a) Not assume responsibility for the accurate designation of the components of a name; and

      (b) Accurately enter the data in accordance with the filer’s designation.

      (2) Titles and prefixes before names. Titles and prefixes, such as "doctor", "reverend", "Mr.", and "Mrs.", shall not be provided by filers on a UCC record. If a UCC record is submitted with titles or prefixes in the designated name fields, the data shall be entered exactly as it appears.

      (3) Titles and suffixes after names. Titles or indications of status such as "M.D." and "esquire" shall not be provided by filers on a UCC record. If a UCC record is submitted with titles or indications of status in the designated name fields, the data shall be entered exactly as it appears. Suffixes that indicate which individual is being named, such as "senior", "junior", "I", "II", and "III", shall be provided by filers in the field designated for name suffixes.

      (4) Truncation of individual names. Personal name fields in the UCC Information Management System shall be fixed in length. Although filers shall provide full names on their UCC records, a name that exceeds the fixed length shall be entered as presented to the filing officer, up to the maximum length of the data entry fields. The lengths of data entry name fields shall be as follows:

      (a) First name: fifty (50) characters.

      (b) Middle name: fifty (50) characters.

      (c) Last name: fifty (50) characters.

      (d) Suffix: fifty (50) characters.

      Section 4. Names of Debtors or Secured Parties that are Organizations.

      (1) Single field. The names of organizations shall be stored in files that include only the names of organizations and not the names of individuals.

      (2) Truncation of organization names. The organization name field in the UCC Information Management System shall be fixed in length. The maximum length shall be 300 characters. Although filers shall continue to provide full names on their UCC records, a name that exceeds the fixed length shall be entered as presented to the filing officer, up to the maximum length of the data entry field.

      Section 5. Estates. An estate shall be treated as if the decedent were the debtor under Section 3 of this administrative regulation.

      Section 6. Trusts. (1) If the trust is named in its organic record, its full legal name, as set forth in the record, shall be used and the trust shall be treated as an organization.

      (2) If the trust is not named in its organic record, the name of the settler shall be used.

      (a)1. If a settler is indicated to be an organization, the name shall be treated as an organization name.

      2. If the settler is an individual, the name shall be treated as an individual name.

      (b) A UCC record that uses a settler's name shall include other information provided by the filer to distinguish the debtor trust from other trusts having the same settler.

      (3) All financing statements filed against trusts or trustees acting with respect to property held in trusts shall indicate the nature of the debtor.

      Section 7. (1) Upon the filing of an initial financing statement, the status of the financing statement shall be active.

      (2) The lapse date shall be calculated in accordance with KRS 355.9-515.

      (3) A financing statement shall remain active as provided in KRS 355.9-519(7).

      Section 8. Amendment. Upon the filing of an amendment, the status of the parties and the status of the financing statement shall be as follows:

      (1) Status of secured party and debtor. An amendment shall affect the status of its debtor and secured party as follows:

      (a) Collateral amendment or address change. An amendment that amends only the collateral description or one (1) or more address shall not effect the status of any debtor or secured party.

      (b) Debtor name change. An amendment that changes a debtor’s name shall not effect the status of a debtor or secured party. If the debtor's name is changed, the related initial financing statement and all UCC records that include an identification of the initial financing statement shall be cross indexed in the UCC Information Management System so that a search under either the debtor’s old name or the debtor’s new name will reveal the initial financing statement and the related UCC records.

      (c) Secured party name change. An amendment that changes the name of a secured party shall not effect the status of a debtor or a secured party. The new name shall be added to the index as if it were a new secured party.

      (d) Addition of a debtor. An amendment that adds a new debtor name shall not effect the status of any party to the financing statement. The new debtor name shall be added as a new debtor on the financing statement.

      (e) Addition of secured party. An amendment that adds a new secured party shall not affect the status of any party to the financing statement. The new secured party name shall be added as a new secured party on the financing statement.

      (f) Deletion of debtor. An amendment that deletes a debtor shall not effect the status of any party to the financing statement, even if the amendment purports to delete all debtors.

      (g) Deletion of secured party. An amendment that deletes a secured party shall not effect the status of any party to the financing statement, even if the amendment purports to delete all secured parties.

      (2) Status of financing statement. An amendment shall have no effect upon the status of the financing statement, except that a continuation may extend the period of effectiveness of a financing statement.

      Section 9. Assignment of Powers of Secured Party. (1) Status of the parties. An assignment shall have no effect on the status of the parties to the financing statement, except that each assignee named in the assignment shall become a secured party.

      (2) Status of financing statement. An assignment shall have no effect upon the status of the financing statement.

      Section 10. Continuation. (1) Continuation of lapse date. Upon the timely filing of one (1) or more continuations by any secured party, the lapse date of the financing statement shall be postponed for five (5) years.

      (2) Status of parties. The filing of a continuation shall have no effect upon the status of any party to the financing statement.

      (3) Status of financing statement. Upon the filing of a continuation statement, the status of the financing statement shall remain active.

      Section 11. Termination. (1) Status of parties. The filing of a termination shall have no effect upon the status of any party to the financing statement.

      (2) Status of financing statement. A termination shall have no effect upon the status of the financing statement and the financing statement shall remain active for the time period established in Section 7(3) of this administrative regulation.

      Section 12. Correction Statement. (1) Status of parties. The filing of a correction statement shall have no effect upon the status of any party to the financing statement.

      (2) Status of financing statement. A correction statement shall have no effect upon the status of the financing statement.

      Section 13. Procedure upon Lapse. If a continuation statement is not timely filed, the financing statement shall lapse on its lapse date but no action shall be taken by the filing office. On the first anniversary of the lapse date, the Information Management System shall render the financing statement inactive and the financing statement shall no longer be made available to a searcher unless:

      (1) Inactive statements are requested by the searcher; and

      (2) The financing statement is still retrievable by the Information Management System.

      Section 14. XML Documents. The XML format as adopted by the International Association of Corporation Administrators shall be used for electronic transmission of UCC records except correction statements. At the request of an authorized XML remitter, the filing officer shall identify which versions and releases of the XML format are acceptable to the filing office.

      Section 15. Direct On-line (Non-XML) Data Entry Procedures. A UCC record except correction statements may be filed electronically by accessing the Secretary of State’s web site. (28 Ky.R. 998; Am. 1346; eff. 12-19-2001.)