UCC 9-307 location rules causing filing nightmare - debtor moved states
I'm pulling my hair out over UCC 9-307 location requirements and need some clarity before our continuation deadline hits next month. We have a borrower who incorporated in Delaware but moved their principal operations to Texas about 18 months ago. The original UCC-1 was filed in Delaware back in 2020 based on their incorporation state, but now I'm second-guessing whether we should have amended the filing location when they relocated their main business operations. The collateral is heavy equipment that's physically located in Texas, but the debtor is still a Delaware corporation. I've been going in circles trying to figure out if UCC 9-307 requires us to refile in Texas or if Delaware remains the correct jurisdiction since they're still incorporated there. Our loan docs are pretty standard but don't specifically address this scenario. Has anyone dealt with this type of jurisdictional headache before? I'm worried we might have an unperfected lien if we got the location wrong, and with the continuation coming up, I need to make sure we're filing in the right state. The equipment is worth about $850K so getting this wrong isn't an option.
33 comments
Join the conversation
Rachel Tao
Delaware should still be correct since they're incorporated there. UCC 9-307 looks at the state of incorporation for registered organizations, not where they do business. The physical location of collateral doesn't change the filing jurisdiction for most types of collateral.
0 coins
Derek Olson
•Are you sure about that? I thought there were exceptions for certain types of collateral or if the debtor's chief executive office moved?
0 coins
Rachel Tao
•The chief executive office rule only applies to unincorporated entities. For corporations, it's almost always the state of incorporation under 9-307(e).
0 coins
Danielle Mays
Wait, are we talking about equipment or fixtures here? Because if any of that equipment became fixtures after installation, you might need to look at fixture filing rules which could change everything about jurisdiction.
0 coins
Sayid Hassan
•It's mobile construction equipment - excavators, bulldozers, that kind of thing. Definitely not fixtures, they move between job sites regularly.
0 coins
Danielle Mays
•Ok good, that keeps it simple then. Mobile equipment stays under the general rules.
0 coins
Roger Romero
I ran into something similar last year and ended up using Certana.ai's document verification tool to double-check everything. You can upload your original UCC-1 and any related docs to make sure the debtor name and jurisdiction info is all consistent. Saved me from a potential disaster when I found a small discrepancy in the debtor name between our loan docs and the UCC filing.
0 coins
Anna Kerber
•How accurate is that tool? I've been manually cross-checking everything but it's so time consuming.
0 coins
Roger Romero
•Pretty solid - it caught things I missed doing manual comparisons. Just upload PDFs and it flags any inconsistencies between documents.
0 coins
Niko Ramsey
•Does it help with jurisdiction questions too or just name matching?
0 coins
Roger Romero
•Mainly document consistency, but it does flag if your UCC shows one state and your charter docs show another.
0 coins
Seraphina Delan
UCC 9-307(e) is pretty clear - for registered organizations like corporations, you file where they're organized (incorporated). Even if they moved operations, Delaware incorporation means Delaware filing. The equipment being in Texas doesn't matter for non-fixture collateral.
0 coins
Jabari-Jo
•But what if Texas has some weird rule about equipment financing? Some states have their own quirks.
0 coins
Seraphina Delan
•Texas follows standard UCC rules for this. The only time location of goods matters is for certain agricultural liens or if the debtor isn't a registered organization.
0 coins
Kristin Frank
This is exactly why I hate UCC filings! The rules seem straightforward until you hit edge cases like this. I spent three days researching a similar situation last month only to find out I was overthinking it.
0 coins
Micah Trail
•Tell me about it. And God forbid you mess up the continuation timing on top of everything else.
0 coins
Nia Watson
•At least continuations are easier than the initial filing. Just don't wait until the last minute!
0 coins
Alberto Souchard
Have you checked if Delaware has any specific requirements for out-of-state operations? Some states want notification even if the filing stays put.
0 coins
Sayid Hassan
•I haven't seen anything in Delaware's UCC rules about notification requirements. Do you know of specific states that require this?
0 coins
Alberto Souchard
•I might be mixing this up with corporate registration requirements. UCC is probably different.
0 coins
Katherine Shultz
Quick question - when did they actually move operations to Texas? If it was after your UCC-1 filing, then you were definitely correct at the time of filing, which is what matters for perfection.
0 coins
Sayid Hassan
•The move happened about 6 months after we filed the original UCC-1. So we were right initially, but I'm wondering about ongoing perfection.
0 coins
Marcus Marsh
•Ongoing perfection stays valid as long as you were right when you filed. The incorporation state rule doesn't change just because they moved operations.
0 coins
Hailey O'Leary
I'd double-check your loan agreement to see if there are any covenants about maintaining corporate domicile. Sometimes borrowers agree to stay incorporated in the same state for exactly this reason.
0 coins
Sayid Hassan
•Good point. I'll review the loan docs again. I don't remember a specific covenant but it's worth checking.
0 coins
Cedric Chung
•Even if there's no covenant, it doesn't change the UCC filing requirements. Delaware incorporation still means Delaware filing.
0 coins
Talia Klein
One more thing to consider - make sure the debtor name on your UCC-1 exactly matches their current corporate name in Delaware. Sometimes companies do DBA filings or name changes when they expand to new states.
0 coins
Maxwell St. Laurent
•This is huge! I've seen filings become ineffective because the debtor changed their legal name and nobody updated the UCC.
0 coins
PaulineW
•Yeah, that's where something like Certana really helps. Upload your current corporate docs and your UCC-1 to make sure the names still match perfectly.
0 coins
Sayid Hassan
•I'll definitely verify the name match. That would be a disaster if they did a name change and we missed it.
0 coins
Annabel Kimball
For what it's worth, I think you're in good shape. Delaware incorporation = Delaware UCC filing. Focus on getting your continuation filed on time and make sure all the details are accurate.
0 coins
Chris Elmeda
•Agreed. The jurisdiction question seems pretty straightforward here.
0 coins
Sayid Hassan
•Thanks everyone. Sounds like Delaware is definitely the right jurisdiction. I'll focus on getting the continuation details perfect and filed well before the deadline.
0 coins