Scribd
Upload
183 views

Sample COLLATERALlanguage

This document summarizes how to properly file a UCC-1 financing statement when issuing a promissory note to register your interest as the secured party. It recommends filing in New York, Delaware, or Maryland where many companies register to do business in the US. Checking the "Bailee/Bailor" box on the UCC-1 identifies that the promissory note is being tendered to a fiduciary for the purpose of discharging a debt through a bailment arrangement, where the fiduciary acts as the trustee or bailee. Properly identifying all debtors on the UCC-1 by the names on their social security cards registers a security interest against their commercial vessel or legal identity.

Uploaded by

Rose
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
183 views

Sample COLLATERALlanguage

This document summarizes how to properly file a UCC-1 financing statement when issuing a promissory note to register your interest as the secured party. It recommends filing in New York, Delaware, or Maryland where many companies register to do business in the US. Checking the "Bailee/Bailor" box on the UCC-1 identifies that the promissory note is being tendered to a fiduciary for the purpose of discharging a debt through a bailment arrangement, where the fiduciary acts as the trustee or bailee. Properly identifying all debtors on the UCC-1 by the names on their social security cards registers a security interest against their commercial vessel or legal identity.

Uploaded by

Rose
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 2

COLLATERAL: CERTAIN REAL PROPERTY LOCATED AT: 123 EASY STREET,

ANYWHERE, STATE 12345, TOGETHER WITH ALL IMPROVEMENTS,


FIXTURES AND APPURTENANCES.LEGAL DESCRIPTION OF PROPERTY:LOT
21, ACCORDING TO THE PLAT OF RECORD IN THE OFFICE OF THE COUNTY
RECORDER OF ANYWHERE COUNTY, ANYWHERE STATE RECORDED IN
BOOK 7 OF MAPS, PAGE 3.

Example of Box 4 which covers the description of collateral:[ORIGINAL


ISSUE] NOTE 1234567 FOR FIFTY THOUSAND DOLLARS
($50,000.00)ASSIGNED TO THE FIDUCIARY/BAILEE, FOR SETOFF,
SETTLEMENT, CLOSURE ANDDISCHARGE OF ALL CLAIMS BY
JOHN DOE ATTY ESQ. LLC & ABC BANK, N.A. ACCOUNT NUMBER
2749462920.NOTE 1223445666 TENDERED BY REGISTERED MAIL #
RA181818181IS VERIFIABLE AT ustatespostals

NOTES :

When we issue commercial paper for example a promissory note, we want to


register our interest. It is suggested to file in New York, Delaware or Maryland
because foreign companies register in Delaware and Maryland into the commercial
registry to do business within the United States. Not filing in one of these states
may be why or part of why a UCC Financing Statement might be ignored ...it might
not be done the right way. The Secured Party Creditor status is about making an
entry into the commercial registry. So when we are putting a UCC-1 commercial lien
in the international commercial registry this UCC-1 in the same registry as Bank Of
America, PNC Bank., Wells Fargo etc and all the other international companies.
Therefore, ifyou are going to be creating a liability then you want the record of your
interest in the international registry. When people hear UCC -1 many people think of
commercial liens which is part of it, but technically the UCC-1 is a financing
statement, so, every time you fund an account or you finance a transaction you
should be making record of it. If your starting to discharge debts or your dealing with
currency that is not Federal Reserve Notes because FRN’s are already registered
they all have their own serial number on them, their liens basically, but if your
funding transactions with your private currency you may issue a financing statement.
Here is a scenario...you receive a presentment saying in a nutshell that “you owe
this money or we’re going to take your property”. Whoever sent that to you, that is
their claim, that’s their account. An account and a claim are interchangeable,-
someone says they are entitled to funding. So they presented their claim and as a
secured party in a transaction we say ok, I’ll accept (A4V) and fund this transaction
by giving you the funding you need - I am going to complete your claim. So when
you issue a promissory note you want to record your interest because you are the
principle, you are the source of the funding, the originator of the funding, the funds
belong to you - you are keeping track. You register because you are the principle
and original issuer. That’s the purpose of the UCC-1.Here is an important highlight
of the video. When filing the UCC-1, go to box 5 called alternative designation if
applicable - check the Bailee Bailor box. Why check the Bailee Bailor box? Because
we are tendering an instrument to a fiduciary (presuming we already appointed the
moving party or the moving party’s attorney as the fiduciary) this is a bailment. The
tendering of the instrument to the fiduciary is a bailment – look up the term bailment,
it is an express trust where the grantor/settler/Bailor gives specific property to the
Trustee/Bailee for a specific purpose. In this instance we being the Bailor are giving
a promissory note to the Fiduciary/Bailee (attorney whom you sent your fiduciary
appointment letter to) and giving it to him for the purpose of discharging a debt. This
is a safe way to do it because although in box number 1 his name is in the debtor
box and it looks like we are making him a debtor and putting a lien on him that’s not
what we are doing – we are making him a Bailee because we established a trust
when we gave him the funds to discharge the claim. You may have to add more
than one debtor (for example the Bank and the Bank's attorney, in 2 separate debtor
boxes) Try to write their names the way it reads on their Social Security card if you
can because you are setting them up for a commercial liability if they go into default.
If you know what records to request you might find it – use an Open Records
Request and Freedom of Information law to get their information which is public
information. Remember, you’ve registered a security to them, to their commercial
vessel (the name on their Social Security card)

You might also like