State of Illinois
92nd General Assembly

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 1        AN ACT concerning liens.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.   The  Code  of Civil Procedure is amended by
 5    changing Section 9-316 as follows:

 6        (735 ILCS 5/9-316) (from Ch. 110, par. 9-316)
 7        Sec. 9-316.  Lien upon crops. Every landlord shall have a
 8    lien upon  the  crops  grown  or  growing  upon  the  demised
 9    premises  for  the  rent thereof, whether the same is payable
10    wholly or in part in money or specific articles  of  property
11    or  products  of  the  premises,  or  labor, and also for the
12    faithful performance of the terms of  the  lease.  Such  lien
13    shall   continue  for  the  period  of  6  months  after  the
14    expiration of the term for which the  premises  are  demised,
15    and  may  be  enforced  by distraint as provided in Part 3 of
16    Article IX of this Act.
17        A good faith purchaser shall, however,  take  such  crops
18    free  of any landlord's lien unless, within 6 months prior to
19    the purchase, the landlord provides  written  notice  of  his
20    lien  to the purchaser by registered or certified mail.  Such
21    notice shall contain the names and addresses of the  landlord
22    and tenant, and clearly identify the leased property.
23        A  landlord  may  require  that,  prior  to  his tenant's
24    selling any crops grown on the demised premises,  the  tenant
25    disclose the name of the person to whom the tenant intends to
26    sell those crops.  Where such a requirement has been imposed,
27    the  tenant shall not sell the crops to any person other than
28    a person  who  has  been  disclosed  to  the  landlord  as  a
29    potential buyer of the crops.
30        A  lien  arising  under  this  Section and duly perfected
31    under Article 9 of the Uniform  Commercial  Code  shall  have
                            -2-                LRB9211690SMdv
 1    priority  over any other agricultural lien as defined in, and
 2    over any  security  interest  arising  under,  provisions  of
 3    Article 9 of the Uniform Commercial Code.
 4    (Source: P.A. 91-893, eff. 7-1-01.)

 5        Section  10.   The  Uniform Commercial Code is amended by
 6    changing Sections 9-102 and 9-109 as follows:

 7        (810 ILCS 5/9-102) (from Ch. 26, par. 9-102)
 8        Sec. 9-102. Definitions and index of definitions.
 9        (a)  Article 9 definitions.  In this Article:
10             (1)  "Accession" means  goods  that  are  physically
11        united  with  other  goods  in  such  a  manner  that the
12        identity of the original goods is not lost.
13             (2)  "Account", except as  used  in  "account  for",
14        means  a  right  to  payment  of  a  monetary obligation,
15        whether or not earned by performance,  (i)  for  property
16        that  has  been  or  is  to  be  sold,  leased, licensed,
17        assigned, or otherwise disposed  of,  (ii)  for  services
18        rendered  or  to  be  rendered,  (iii)  for  a  policy of
19        insurance issued or to be issued, (iv)  for  a  secondary
20        obligation  incurred  or  to  be incurred, (v) for energy
21        provided or to be provided, (vi) for the use or hire of a
22        vessel under a charter or other contract,  (vii)  arising
23        out  of the use of a credit or charge card or information
24        contained on or for use  with  the  card,  or  (viii)  as
25        winnings in a lottery or other game of chance operated or
26        sponsored  by  a  State, governmental unit of a State, or
27        person licensed or authorized to operate the  game  by  a
28        State or governmental unit of a State.  The term includes
29        health-care-insurance  receivables.   The  term  does not
30        include (i) rights to payment evidenced by chattel  paper
31        or  an  instrument,  (ii)  commercial  tort claims, (iii)
32        deposit   accounts,   (iv)   investment   property,   (v)
                            -3-                LRB9211690SMdv
 1        letter-of-credit rights or letters  of  credit,  or  (vi)
 2        rights  to  payment  for money or funds advanced or sold,
 3        other than rights arising out of the use of a  credit  or
 4        charge  card  or information contained on or for use with
 5        the card.
 6             (3)  "Account debtor" means a person obligated on an
 7        account, chattel paper, or general intangible.  The  term
 8        does  not  include  persons obligated to pay a negotiable
 9        instrument, even if the instrument  constitutes  part  of
10        chattel paper.
11             (4)  "Accounting",  except  as  used  in "accounting
12        for", means a record:
13                  (A)  authenticated by a secured party;
14                  (B)  indicating the  aggregate  unpaid  secured
15             obligations  as  of  a  date  not  more than 35 days
16             earlier or 35  days  later  than  the  date  of  the
17             record; and
18                  (C)  identifying    the   components   of   the
19             obligations in reasonable detail.
20             (5)  "Agricultural lien" means  an  interest,  other
21        than a security interest, in farm products:
22                  (A)  which secures payment or performance of an
23             obligation  for:  (i) goods or services furnished in
24             connection with a  debtor's  farming  operation;  or
25             (ii)  rent  on  real  property leased by a debtor in
26             connection with its farming operation;
27                  (B)  which is created by statute in favor of  a
28             person  that:  (i)  in  the  ordinary  course of its
29             business furnished goods or services to a debtor  in
30             connection  with  a  debtor's  farming operation; or
31             (ii) leased real property to a debtor in  connection
32             with the debtor's farming operation; and
33                  (C)  whose effectiveness does not depend on the
34             person's possession of the personal property.
                            -4-                LRB9211690SMdv
 1             (6)  "As-extracted collateral" means:
 2                  (A)  oil,  gas,  or  other  minerals  that  are
 3             subject to a security interest that:
 4                       (i)  is  created  by  a  debtor  having an
 5                  interest in the minerals before extraction; and
 6                       (ii)  attaches   to   the   minerals    as
 7                  extracted; or
 8                  (B)  accounts  arising  out  of the sale at the
 9             wellhead or minehead of oil, gas, or other  minerals
10             in   which   the   debtor  had  an  interest  before
11             extraction.
12             (7)  "Authenticate" means:
13                  (A)  to sign; or
14                  (B)  to execute or otherwise adopt a symbol, or
15             encrypt or similarly process a record in whole or in
16             part, with the present intent of the  authenticating
17             person  to identify the person and adopt or accept a
18             record.
19             (8)  "Bank" means an organization that is engaged in
20        the business  of  banking.   The  term  includes  savings
21        banks,  savings and loan associations, credit unions, and
22        trust companies.
23             (9)  "Cash proceeds" means proceeds that are  money,
24        checks, deposit accounts, or the like.
25             (10)  "Certificate  of title" means a certificate of
26        title with respect to which a statute  provides  for  the
27        security  interest  in  question  to  be indicated on the
28        certificate as a condition  or  result  of  the  security
29        interest's  obtaining  priority over the rights of a lien
30        creditor with respect to the collateral.
31             (11)  "Chattel paper" means a record or records that
32        evidence  both  a  monetary  obligation  and  a  security
33        interest  in  specific  goods,  a  security  interest  in
34        specific goods and software used in the goods, a security
                            -5-                LRB9211690SMdv
 1        interest in specific goods and license of  software  used
 2        in  the  goods,  a lease of specific goods, or a lease of
 3        specified goods and a license of  software  used  in  the
 4        goods.   In this paragraph, "monetary obligation" means a
 5        monetary obligation secured by the goods or owed under  a
 6        lease  of  the  goods  and includes a monetary obligation
 7        with respect to software used in  the  goods.   The  term
 8        does   not   include  (i)  charters  or  other  contracts
 9        involving the use or hire of a  vessel  or  (ii)  records
10        that  evidence  a right to payment arising out of the use
11        of a credit or charge card or information contained on or
12        for use with the card.  If a transaction is evidenced  by
13        records   that   include   an  instrument  or  series  of
14        instruments,  the  group  of   records   taken   together
15        constitutes chattel paper.
16             (12)  "Collateral"  means  the property subject to a
17        security  interest  or  agricultural  lien.    The   term
18        includes:
19                  (A)  proceeds  to  which  a  security  interest
20             attaches;
21                  (B)  accounts,     chattel    paper,    payment
22             intangibles, and promissory  notes  that  have  been
23             sold; and
24                  (C)  goods   that   are   the   subject   of  a
25             consignment.
26             (13)  "Commercial tort claim" means a claim  arising
27        in tort with respect to which:
28                  (A)  the claimant is an organization; or
29                  (B)  the  claimant  is  an  individual  and the
30             claim:
31                       (i)  arose in the course of the claimant's
32                  business or profession; and
33                       (ii)  does not include damages arising out
34                  of personal  injury  to  or  the  death  of  an
                            -6-                LRB9211690SMdv
 1                  individual.
 2             (14)  "Commodity    account"    means   an   account
 3        maintained  by  a  commodity  intermediary  in  which   a
 4        commodity contract is carried for a commodity customer.
 5             (15)  "Commodity contract" means a commodity futures
 6        contract,  an  option  on a commodity futures contract, a
 7        commodity option, or another contract if the contract  or
 8        option is:
 9                  (A)  traded  on  or  subject  to the rules of a
10             board  of  trade  that  has  been  designated  as  a
11             contract market for  such  a  contract  pursuant  to
12             federal commodities laws; or
13                  (B)  traded  on  a  foreign  commodity board of
14             trade, exchange, or market, and is  carried  on  the
15             books  of  a  commodity intermediary for a commodity
16             customer.
17             (16)  "Commodity customer" means a person for  which
18        a  commodity intermediary carries a commodity contract on
19        its books.
20             (17)  "Commodity intermediary" means a person that:
21                  (A)  is  registered  as  a  futures  commission
22             merchant under federal commodities law; or
23                  (B)  in the ordinary  course  of  its  business
24             provides  clearance  or  settlement  services  for a
25             board  of  trade  that  has  been  designated  as  a
26             contract market pursuant to federal commodities law.
27             (18)  "Communicate" means:
28                  (A)  to  send  a  written  or  other   tangible
29             record;
30                  (B)  to  transmit  a record by any means agreed
31             upon  by  the  persons  sending  and  receiving  the
32             record; or
33                  (C)  in the case of transmission of a record to
34             or by a filing office, to transmit a record  by  any
                            -7-                LRB9211690SMdv
 1             means prescribed by filing-office rule.
 2             (19)  "Consignee"  means  a  merchant to which goods
 3        are delivered in a consignment.
 4             (20)  "Consignment" means a transaction,  regardless
 5        of  its  form,  in  which  a  person  delivers goods to a
 6        merchant for the purpose of sale and:
 7                  (A)  the merchant:
 8                       (i)  deals in goods of that kind  under  a
 9                  name  other  than the name of the person making
10                  delivery;
11                       (ii)  is not an auctioneer; and
12                       (iii)  is  not  generally  known  by   its
13                  creditors   to   be  substantially  engaged  in
14                  selling the goods of others;
15                  (B)  with  respect  to   each   delivery,   the
16             aggregate  value  of  the goods is $1,000 or more at
17             the time of delivery;
18                  (C)  the   goods   are   not   consumer   goods
19             immediately before delivery; and
20                  (D)  the transaction does not create a security
21             interest that secures an obligation.
22             (21)  "Consignor" means a person that delivers goods
23        to a consignee in a consignment.
24             (22)  "Consumer debtor" means a debtor in a consumer
25        transaction.
26             (23)  "Consumer goods" means goods that are used  or
27        bought   for  use  primarily  for  personal,  family,  or
28        household purposes.
29             (24)  "Consumer-goods transaction" means a  consumer
30        transaction in which:
31                  (A)  an   individual   incurs   an   obligation
32             primarily   for   personal,   family,  or  household
33             purposes; and
34                  (B)  a  security  interest  in  consumer  goods
                            -8-                LRB9211690SMdv
 1             secures the obligation.
 2             (25)  "Consumer obligor" means an obligor who is  an
 3        individual  and  who incurred the obligation as part of a
 4        transaction entered into primarily for personal,  family,
 5        or household purposes.
 6             (26)  "Consumer  transaction" means a transaction in
 7        which (i) an individual incurs  an  obligation  primarily
 8        for  personal,  family,  or  household  purposes,  (ii) a
 9        security interest secures the obligation, and  (iii)  the
10        collateral  is  held  or acquired primarily for personal,
11        family,  or  household  purposes.   The   term   includes
12        consumer-goods transactions.
13             (27)  "Continuation statement" means an amendment of
14        a financing statement which:
15                  (A)  identifies,   by   its  file  number,  the
16             initial financing statement to which it relates; and
17                  (B)  indicates  that  it  is   a   continuation
18             statement  for,  or that it is filed to continue the
19             effectiveness   of,   the    identified    financing
20             statement.
21             (28)  "Debtor" means:
22                  (A)  a  person having an interest, other than a
23             security interest or other lien, in the  collateral,
24             whether or not the person is an obligor;
25                  (B)  a   seller  of  accounts,  chattel  paper,
26             payment intangibles, or promissory notes; or
27                  (C)  a consignee.
28             (29)  "Deposit  account"  means  a   demand,   time,
29        savings, passbook, nonnegotiable certificates of deposit,
30        uncertificated  certificates of deposit, nontransferrable
31        certificates of deposit, or  similar  account  maintained
32        with  a  bank.   The  term  does  not  include investment
33        property or accounts evidenced by an instrument.
34             (30)  "Document" means a  document  of  title  or  a
                            -9-                LRB9211690SMdv
 1        receipt of the type described in Section 7-201(2).
 2             (31)  "Electronic chattel paper" means chattel paper
 3        evidenced   by   a   record   or  records  consisting  of
 4        information stored in an electronic medium.
 5             (32)  "Encumbrance" means a  right,  other  than  an
 6        ownership  interest, in real property.  The term includes
 7        mortgages and other liens on real property.
 8             (33)  "Equipment" means goods other than  inventory,
 9        farm products, or consumer goods.
10             (34)  "Farm   products"   means  goods,  other  than
11        standing timber, with respect  to  which  the  debtor  is
12        engaged in a farming operation and which are:
13                  (A)  crops  grown,  growing,  or  to  be grown,
14             including:
15                       (i)  crops produced on trees,  vines,  and
16                  bushes; and
17                       (ii)  aquatic     goods     produced    in
18                  aquacultural operations;
19                  (B)  livestock,  born  or   unborn,   including
20             aquatic goods produced in aquacultural operations;
21                  (C)  supplies  used  or  produced  in a farming
22             operation; or
23                  (D)  products of crops or  livestock  in  their
24             unmanufactured states.
25             (35)  "Farming     operation"     means     raising,
26        cultivating,  propagating,  fattening,  grazing,  or  any
27        other farming, livestock, or aquacultural operation.
28             (36)  "File  number" means the number assigned to an
29        initial financing statement pursuant to Section 9-519(a).
30             (37)  "Filing office" means an office designated  in
31        Section 9-501 as the place to file a financing statement.
32             (38)  "Filing-office  rule"  means  a  rule  adopted
33        pursuant to Section 9-526.
34             (39)  "Financing   statement"   means  a  record  or
                            -10-               LRB9211690SMdv
 1        records composed of an initial  financing  statement  and
 2        any  filed  record  relating  to  the  initial  financing
 3        statement.
 4             (40)  "Fixture   filing"   means  the  filing  of  a
 5        financing statement covering goods that  are  or  are  to
 6        become  fixtures and satisfying Section 9-502(a) and (b).
 7        The term includes the filing  of  a  financing  statement
 8        covering goods of a transmitting utility which are or are
 9        to become fixtures.
10             (41)  "Fixtures"  means  goods  that  have become so
11        related to particular real property that an  interest  in
12        them arises under real property law.
13             (42)  "General   intangible"   means   any  personal
14        property,  including  things  in   action,   other   than
15        accounts,  chattel paper, commercial tort claims, deposit
16        accounts,  documents,  goods,   instruments,   investment
17        property,  letter-of-credit  rights,  letters  of credit,
18        money, and oil, gas, or other minerals before extraction.
19        The term includes payment intangibles and software.
20             (43)  "Good faith" means honesty  in  fact  and  the
21        observance  of  reasonable  commercial  standards of fair
22        dealing.
23             (44)  "Goods" means all things that are movable when
24        a security interest  attaches.   The  term  includes  (i)
25        fixtures,  (ii)  standing  timber  that  is to be cut and
26        removed under a conveyance or contract  for  sale,  (iii)
27        the  unborn  young of animals, (iv) crops grown, growing,
28        or to be grown, even if the crops are produced on  trees,
29        vines,  or  bushes, and (v) manufactured homes.  The term
30        also includes a computer program embedded  in  goods  and
31        any  supporting information provided in connection with a
32        transaction relating to the program if (i) the program is
33        associated with the  goods  in  such  a  manner  that  it
34        customarily  is  considered part of the goods, or (ii) by
                            -11-               LRB9211690SMdv
 1        becoming the owner of the  goods,  a  person  acquires  a
 2        right  to  use  the program in connection with the goods.
 3        The term does not include a computer program embedded  in
 4        goods  that  consist  solely  of  the medium in which the
 5        program is embedded.  The  term  also  does  not  include
 6        accounts,  chattel paper, commercial tort claims, deposit
 7        accounts, documents,  general  intangibles,  instruments,
 8        investment  property, letter-of-credit rights, letters of
 9        credit, money, or oil,  gas,  or  other  minerals  before
10        extraction.
11             (45)  "Governmental   unit"   means  a  subdivision,
12        agency,  department,  county,  parish,  municipality,  or
13        other unit of the government  of  the  United  States,  a
14        State,  or  a  foreign  country.   The  term  includes an
15        organization having a separate corporate existence if the
16        organization is eligible to issue debt on which  interest
17        is  exempt  from  income  taxation  under the laws of the
18        United States.
19             (46)  "Health-care-insurance  receivable"  means  an
20        interest in or claim under a policy of insurance which is
21        a  right  to  payment  of  a  monetary   obligation   for
22        health-care goods or services provided.
23             (47)  "Instrument"  means a negotiable instrument or
24        any other writing that evidences a right to  the  payment
25        of  a  monetary  obligation,  is  not  itself  a security
26        agreement or lease, and is of a  type  that  in  ordinary
27        course  of  business  is transferred by delivery with any
28        necessary indorsement or assignment.  The term  does  not
29        include  (i) investment property, (ii) letters of credit,
30        (iii)  nonnegotiable  certificates   of   deposit,   (iv)
31        uncertificated     certificates     of    deposit,    (v)
32        nontransferrable  certificates  of   deposit,   or   (vi)
33        writings  that evidence a right to payment arising out of
34        the use  of  a  credit  or  charge  card  or  information
                            -12-               LRB9211690SMdv
 1        contained on or for use with the card.
 2             (48)  "Inventory"   means  goods,  other  than  farm
 3        products, which:
 4                  (A)  are leased by a person as lessor;
 5                  (B)  are held by a person for sale or lease  or
 6             to be furnished under a contract of service;
 7                  (C)  are furnished by a person under a contract
 8             of service; or
 9                  (D)  consist of raw materials, work in process,
10             or materials used or consumed in a business.
11             (49)  "Investment   property"   means   a  security,
12        whether   certificated   or   uncertificated,    security
13        entitlement,  securities  account, commodity contract, or
14        commodity account.
15             (50)  "Jurisdiction of organization",  with  respect
16        to  a  registered  organization,  means  the jurisdiction
17        under whose law the organization is organized.
18             (51)  "Letter-of-credit  right"  means  a  right  to
19        payment or performance under a letter of credit,  whether
20        or  not  the  beneficiary  has demanded or is at the time
21        entitled to demand payment or performance.  The term does
22        not include the right of a beneficiary to demand  payment
23        or performance under a letter of credit.
24             (52)  "Lien creditor" means:
25                  (A)  a creditor that has acquired a lien on the
26             property involved by attachment, levy, or the like;
27                  (B)  an  assignee for benefit of creditors from
28             the time of assignment;
29                  (C)  a trustee in bankruptcy from the  date  of
30             the filing of the petition; or
31                  (D)  a  receiver  in  equity  from  the time of
32             appointment.
33             (53)  "Manufactured   home"   means   a   structure,
34        transportable in one or  more  sections,  which,  in  the
                            -13-               LRB9211690SMdv
 1        traveling mode, is eight body feet or more in width or 40
 2        body feet or more in length, or, when erected on site, is
 3        320  or  more  square  feet,  and  which  is  built  on a
 4        permanent chassis and designed to be used as  a  dwelling
 5        with  or without a permanent foundation when connected to
 6        the  required  utilities,  and  includes  the   plumbing,
 7        heating,   air-conditioning,   and   electrical   systems
 8        contained  therein.  The term includes any structure that
 9        meets all of the requirements of  this  paragraph  except
10        the  size  requirements  and  with  respect  to which the
11        manufacturer voluntarily files a  certification  required
12        by  the  United  States  Secretary  of  Housing and Urban
13        Development and complies with the  standards  established
14        under Title 42 of the United States Code.
15             (54)  "Manufactured-home    transaction"   means   a
16        secured transaction:
17                  (A)  that  creates  a  purchase-money  security
18             interest  in  a  manufactured  home,  other  than  a
19             manufactured home held as inventory; or
20                  (B)  in which a manufactured home, other than a
21             manufactured home held as inventory, is the  primary
22             collateral.
23             (55)  "Mortgage" means a consensual interest in real
24        property,  including  fixtures,  which secures payment or
25        performance of an obligation.
26             (56)  "New debtor" means a person that becomes bound
27        as debtor under Section 9-203(d) by a security  agreement
28        previously entered into by another person.
29             (57)  "New  value"  means  (i)  money,  (ii) money's
30        worth in property, services,  or  new  credit,  or  (iii)
31        release  by  a  transferee  of  an  interest  in property
32        previously transferred to the transferee.  The term  does
33        not   include   an  obligation  substituted  for  another
34        obligation.
                            -14-               LRB9211690SMdv
 1             (58)  "Noncash proceeds" means proceeds  other  than
 2        cash proceeds.
 3             (59)  "Obligor" means a person that, with respect to
 4        an  obligation  secured  by  a security interest in or an
 5        agricultural lien on the collateral, (i) owes payment  or
 6        other  performance  of  the obligation, (ii) has provided
 7        property other than the collateral to secure  payment  or
 8        other   performance   of  the  obligation,  or  (iii)  is
 9        otherwise accountable in whole or in part for payment  or
10        other  performance  of the obligation.  The term does not
11        include issuers or nominated persons under  a  letter  of
12        credit.
13             (60)  "Original  debtor",  except as used in Section
14        9-310(c), means a person that, as debtor, entered into  a
15        security agreement to which a new debtor has become bound
16        under Section 9-203(d).
17             (61)  "Payment    intangible"    means   a   general
18        intangible under which  the  account  debtor's  principal
19        obligation is a monetary obligation.
20             (62)  "Person   related  to",  with  respect  to  an
21        individual, means:
22                  (A)  the spouse of the individual;
23                  (B)  a  brother,  brother-in-law,  sister,   or
24             sister-in-law of the individual;
25                  (C)  an  ancestor  or  lineal descendant of the
26             individual or the individual's spouse; or
27                  (D)  any other relative, by blood or  marriage,
28             of  the  individual  or  the individual's spouse who
29             shares the same home with the individual.
30             (63)  "Person  related  to",  with  respect  to   an
31        organization, means:
32                  (A)  a    person    directly    or   indirectly
33             controlling, controlled by, or under common  control
34             with the organization;
                            -15-               LRB9211690SMdv
 1                  (B)  an  officer  or  director  of, or a person
 2             performing similar functions with  respect  to,  the
 3             organization;
 4                  (C)  an  officer  or  director  of, or a person
 5             performing similar  functions  with  respect  to,  a
 6             person described in subparagraph (A);
 7                  (D)  the  spouse  of an individual described in
 8             subparagraph (A), (B), or (C); or
 9                  (E)  an individual who is related by  blood  or
10             marriage  to an individual described in subparagraph
11             (A), (B), (C), or (D) and shares the same home  with
12             the individual.
13             (64)  "Proceeds",   except   as   used   in  Section
14        9-609(b), means the following property:
15                  (A)  whatever is acquired upon the sale, lease,
16             license,   exchange,   or   other   disposition   of
17             collateral;
18                  (B)  whatever is collected on,  or  distributed
19             on account of, collateral;
20                  (C)  rights arising out of collateral;
21                  (D)  to  the extent of the value of collateral,
22             claims arising out of the  loss,  nonconformity,  or
23             interference   with   the   use   of,   defects   or
24             infringement   of  rights  in,  or  damage  to,  the
25             collateral; or
26                  (E)  to the extent of the value  of  collateral
27             and  to  the  extent  payable  to  the debtor or the
28             secured party, insurance payable by  reason  of  the
29             loss or nonconformity of, defects or infringement of
30             rights in, or damage to, the collateral.
31             (65)  "Promissory  note"  means  an  instrument that
32        evidences a promise to pay a  monetary  obligation,  does
33        not  evidence  an  order  to pay, and does not contain an
34        acknowledgment by a bank that the bank has  received  for
                            -16-               LRB9211690SMdv
 1        deposit a sum of money or funds.
 2             (66)  "Proposal"  means  a record authenticated by a
 3        secured party which  includes  the  terms  on  which  the
 4        secured  party is willing to accept collateral in full or
 5        partial  satisfaction  of  the  obligation   it   secures
 6        pursuant to Sections 9-620, 9-621, and 9-622.
 7             (67)  "Public-finance  transaction"  means a secured
 8        transaction in connection with which:
 9                  (A)  debt securities are issued;
10                  (B)  all or a portion of the securities  issued
11             have  an  initial  stated  maturity  of  at least 20
12             years; and
13                  (C)  the  debtor,   obligor,   secured   party,
14             account   debtor   or   other  person  obligated  on
15             collateral,  assignor  or  assignee  of  a   secured
16             obligation,  or  assignor  or assignee of a security
17             interest is a State or  a  governmental  unit  of  a
18             State.
19             (68)  "Pursuant  to  commitment", with respect to an
20        advance made or other value given  by  a  secured  party,
21        means pursuant to the secured party's obligation, whether
22        or  not  a subsequent event of default or other event not
23        within the secured party's control has  relieved  or  may
24        relieve the secured party from its obligation.
25             (69)  "Record",  except as used in "for record", "of
26        record", "record or legal  title",  and  "record  owner",
27        means  information that is inscribed on a tangible medium
28        or which is stored in an electronic or other  medium  and
29        is retrievable in perceivable form.
30             (70)  "Registered     organization"     means     an
31        organization  organized  solely under the law of a single
32        State or the United States and as to which the  State  or
33        the  United  States must maintain a public record showing
34        the organization to have been organized.
                            -17-               LRB9211690SMdv
 1             (71)  "Secondary obligor" means an  obligor  to  the
 2        extent that:
 3                  (A)  the obligor's obligation is secondary; or
 4                  (B)  the  obligor  has a right of recourse with
 5             respect  to  an  obligation  secured  by  collateral
 6             against the debtor, another obligor, or property  of
 7             either.
 8             (72)  "Secured party" means:
 9                  (A)  a   person   in  whose  favor  a  security
10             interest is created or provided for under a security
11             agreement, whether  or  not  any  obligation  to  be
12             secured is outstanding;
13                  (B)  a person that holds an agricultural lien;
14                  (C)  a consignor;
15                  (D)  a person to which accounts, chattel paper,
16             payment  intangibles,  or promissory notes have been
17             sold;
18                  (E)  a  trustee,  indenture   trustee,   agent,
19             collateral  agent,  or other representative in whose
20             favor a security interest or  agricultural  lien  is
21             created or provided for; or
22                  (F)  a  person  that  holds a security interest
23             arising  under  Section  2-401,   2-505,   2-711(3),
24             2A-508(5), 4-210, or 5-118.
25             (73)  "Security  agreement"  means an agreement that
26        creates or provides for a security interest.
27             (74)  "Send",  in  connection  with  a   record   or
28        notification, means:
29                  (A)  to   deposit  in  the  mail,  deliver  for
30             transmission, or transmit by any other  usual  means
31             of   communication,   with   postage   or   cost  of
32             transmission provided for, addressed to any  address
33             reasonable under the circumstances; or
34                  (B)  to  cause the record or notification to be
                            -18-               LRB9211690SMdv
 1             received within the time that  it  would  have  been
 2             received if properly sent under subparagraph (A).
 3             (75)  "Software"  means  a  computer program and any
 4        supporting information  provided  in  connection  with  a
 5        transaction  relating  to  the program. The term does not
 6        include a  computer  program  that  is  included  in  the
 7        definition of goods.
 8             (76)  "State"  means  a  State of the United States,
 9        the District of Columbia, Puerto Rico, the United  States
10        Virgin  Islands,  or  any territory or insular possession
11        subject to the jurisdiction of the United States.
12             (77)  "Supporting      obligation"      means      a
13        letter-of-credit  right  or  secondary  obligation   that
14        supports  the  payment  or  performance  of  an  account,
15        chattel  paper,  a  document,  a  general  intangible, an
16        instrument, or investment property.
17             (78)  "Tangible chattel paper" means  chattel  paper
18        evidenced   by   a   record   or  records  consisting  of
19        information that is inscribed on a tangible medium.
20             (79)  "Termination statement" means an amendment  of
21        a financing statement which:
22                  (A)  identifies,   by   its  file  number,  the
23             initial financing statement to which it relates; and
24                  (B)  indicates either that it is a  termination
25             statement or that the identified financing statement
26             is no longer effective.
27             (80)  "Transmitting    utility"   means   a   person
28        primarily engaged in the business of:
29                  (A)  operating  a  railroad,   subway,   street
30             railway, or trolley bus;
31                  (B)  transmitting  communications electrically,
32             electromagnetically, or by light;
33                  (C)  transmitting goods by pipeline  or  sewer;
34             or
                            -19-               LRB9211690SMdv
 1                  (D)  transmitting or producing and transmitting
 2             electricity, steam, gas, or water.
 3        (b)  Definitions   in   other  Articles.   The  following
 4    definitions in other Articles apply to this Article:
 5        "Applicant". Section 5-102.
 6        "Beneficiary". Section 5-102.
 7        "Broker". Section 8-102.
 8        "Certificated security".  Section 8-102.
 9        "Check".  Section 3-104.
10        "Clearing corporation".  Section 8-102.
11        "Contract for sale".  Section 2-106.
12        "Customer".  Section 4-104.
13        "Entitlement holder".  Section 8-102.
14        "Financial asset".  Section 8-102.
15        "Holder in due course".  Section 3-302.
16        "Issuer"  (with  respect  to  a  letter  of   credit   or
17    letter-of-credit right).  Section 5-102.
18        "Issuer" (with respect to a security).  Section 8-201.
19        "Lease".  Section 2A-103.
20        "Lease agreement".  Section 2A-103.
21        "Lease contract".  Section 2A-103.
22        "Leasehold interest".  Section 2A-103.
23        "Lessee".  Section 2A-103.
24        "Lessee in ordinary course of business".  Section 2A-103.
25        "Lessor".  Section 2A-103.
26        "Lessor's residual interest".  Section 2A-103.
27        "Letter of credit".  Section 5-102.
28        "Merchant".  Section 2-104.
29        "Negotiable instrument".  Section 3-104.
30        "Nominated person".  Section 5-102.
31        "Note".  Section 3-104.
32        "Proceeds of a letter of credit".  Section 5-114.
33        "Prove".  Section 3-103.
34        "Sale".  Section 2-106.
                            -20-               LRB9211690SMdv
 1        "Securities account".  Section 8-501.
 2        "Securities intermediary".  Section 8-102.
 3        "Security".  Section 8-102.
 4        "Security certificate".  Section 8-102.
 5        "Security entitlement".  Section 8-102.
 6        "Uncertificated security".  Section 8-102.
 7        (c)  Article  1  definitions  and  principles.  Article 1
 8    contains general definitions and principles  of  construction
 9    and interpretation applicable throughout this Article.
10    (Source: P.A. 91-893, eff. 7-1-01.)

11        (810 ILCS 5/9-109) (from Ch. 26, par. 9-109)
12        Sec. 9-109.  Scope.
13        (a)  General  scope  of  Article.   Except  as  otherwise
14    provided in subsections (c) and (d), this Article applies to:
15             (1)  a  transaction,  regardless  of  its form, that
16        creates a  security  interest  in  personal  property  or
17        fixtures by contract;
18             (2)  an agricultural lien;
19             (3)  a  sale  of  accounts,  chattel  paper, payment
20        intangibles, or promissory notes;
21             (4)  a consignment;
22             (5)  a  security  interest  arising  under   Section
23        2-401,  2-505,  2-711(3),  or  2A-508(5),  as provided in
24        Section 9-110; and
25             (6)  a security interest arising under Section 4-210
26        or 5-118.
27        (b)  Security  interest  in  secured   obligation.    The
28    application  of  this  Article  to  a  security interest in a
29    secured obligation is not  affected  by  the  fact  that  the
30    obligation  is itself secured by a transaction or interest to
31    which this Article does not apply.
32        (c)  Extent  to  which  Article  does  not  apply.   This
33    Article does not apply to the extent that:
                            -21-               LRB9211690SMdv
 1             (1)  a statute, regulation, or treaty of the  United
 2        States preempts this Article;
 3             (2)  another statute of this State expressly governs
 4        the  creation,  perfection, priority, or enforcement of a
 5        security interest created by this State or a governmental
 6        unit of this State;
 7             (3)  a statute of another State, a foreign  country,
 8        or  a  governmental  unit  of  another State or a foreign
 9        country, other than a  statute  generally  applicable  to
10        security    interests,    expressly   governs   creation,
11        perfection,  priority,  or  enforcement  of  a   security
12        interest  created  by the State, country, or governmental
13        unit;
14             (4)  the  rights  of  a  transferee  beneficiary  or
15        nominated person under a letter of credit are independent
16        and superior under Section 5-114;
17             (5)  this  Article  is  in  conflict  with   Section
18        205-410 of the Department of Agriculture Law of the Civil
19        Administrative Code of Illinois or the Grain Code; or
20             (6)  this Article is in conflict with Section 18-107
21        of the Public Utilities Act.
22        (d)  Inapplicability  of  Article.  This Article does not
23    apply to:
24             (1)  a landlord's lien, other than  an  agricultural
25        lien;
26             (2)  a  lien, other than an agricultural lien, given
27        by  statute  or  other  rule  of  law  for  services   or
28        materials,  but  Section  9-333  applies  with respect to
29        priority of the lien;
30             (3)  an assignment of a claim for wages, salary,  or
31        other compensation of an employee;
32             (4)  a  sale  of  accounts,  chattel  paper, payment
33        intangibles, or promissory notes as part of a sale of the
34        business out of which they arose;
                            -22-               LRB9211690SMdv
 1             (5)  an  assignment  of  accounts,  chattel   paper,
 2        payment intangibles, or promissory notes which is for the
 3        purpose of collection only;
 4             (6)  an  assignment  of  a  right to payment under a
 5        contract to an assignee that is also obligated to perform
 6        under the contract;
 7             (7)  an assignment  of  a  single  account,  payment
 8        intangible,  or promissory note to an assignee in full or
 9        partial satisfaction of a preexisting indebtedness;
10             (8)  a transfer of  an interest in or an  assignment
11        of  a  claim  under  a policy of insurance, other than an
12        assignment  by  or  to  a  health-care  provider   of   a
13        health-care-insurance   receivable   and  any  subsequent
14        assignment of the right to payment,  but  Sections  9-315
15        and  9-322  apply with respect to proceeds and priorities
16        in proceeds;
17             (9)  an assignment  of  a  right  represented  by  a
18        judgment,  other  than  a  judgment  taken  on a right to
19        payment that was collateral;
20             (10)  a right of recoupment or set-off, but:
21                  (A)  Section 9-340 applies with respect to  the
22             effectiveness  of  rights  of  recoupment or set-off
23             against deposit accounts; and
24                  (B)  Section  9-404  applies  with  respect  to
25             defenses or claims of an account debtor;
26             (11)  the creation or transfer of an interest in  or
27        lien  on  real  property,  including  a  lease  or  rents
28        thereunder,  except  to the extent that provision is made
29        for:
30                  (A)  liens on real property in  Sections  9-203
31             and 9-308;
32                  (B)  fixtures in Section 9-334;
33                  (C)  fixture  filings in Sections 9-501, 9-502,
34             9-512, 9-516, and 9-519; and
                            -23-               LRB9211690SMdv
 1                  (D)  security agreements covering personal  and
 2             real property in Section 9-604;
 3             (12)  an  assignment  of  a  claim  arising in tort,
 4        other than a commercial tort claim,  but  Sections  9-315
 5        and  9-322  apply with respect to proceeds and priorities
 6        in proceeds;
 7             (13)  a transfer by  a  government  or  governmental
 8        subdivision or agency;
 9             (14)  a claim or a right to receive compensation for
10        injuries or sickness as described in Section 104(a)(1) or
11        (2)  of  Title  26  of the United States Code, as amended
12        from time to time; or
13             (15)  a claim or right to receive benefits  under  a
14        special  needs  trust as described in Section 1396p(d)(4)
15        of Title 42 of the United States Code,  as  amended  from
16        time to time.
17    (Source: P.A. 91-893, eff. 7-1-01.)

18        Section  99.  Effective date.  This Act takes effect upon
19    becoming law.

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