UCC Article 9 security interest perfection issues - debtor name changes affecting lien priority

The change was from 'ABC Manufacturing LLC' to 'ABC Advanced Manufacturing LLC' - so they added 'Advanced' in the middle. I'm not sure if that would be considered seriously misleading or not.

That sounds like it could go either way honestly. The 'seriously misleading' test can be subjective and depends on how the filing office's search logic works.

I did test the search and the original filing does show up when I search the old name, but nothing comes up when I search the new name. That's what's making me nervous.

Yeah that's exactly the problem I was worried about too. The whole Article 9 system seems so fragile when it comes to name changes.

The name change was about 6 months ago, so we're definitely past the four month window. Does that mean we lost perfection entirely or just for new collateral?

Just for collateral acquired after the four month period expired. Your original collateral should still be covered, but anything new they acquired might not be.

This is why I always tell clients to notify us immediately of any name changes. Article 9 doesn't give you much wiggle room on timing.

That sounds helpful. Did it give you specific guidance on the Article 9 requirements or just flag the discrepancies?

It flagged the name mismatches and document inconsistencies, then I could see exactly where the problems were. Made it much easier to decide what corrective filings to do.

I thought Article 9 was supposed to make things simpler but the name change rules seem designed to trip people up.

The policy behind it makes sense - they want the public record to be searchable. But yeah, it creates a lot of traps for the unwary.

Especially when debtors don't think to notify their lenders about entity changes. It should be automatic but it never is.

The continuation should be valid because it's continuing the original filing, which was under the correct name at the time. The name change issue is separate from whether the continuation itself is effective.

OK that makes sense. So the continuation keeps the original filing alive, but the name change might affect what collateral is actually covered.

Same here. I now have calendar reminders set up whenever I hear about any kind of corporate change just to make sure we don't miss the deadline.

That's smart. I started doing quarterly UCC reviews for all our active files just to catch stuff like this early.

Good point. I was so focused on whether we lost perfection that I didn't think about just fixing it going forward.

Definitely file the amendment. Even if there's some technical perfection issue, having the current name on file is better than leaving it wrong.

What did the legal opinion conclude? I'm wondering if I should go that route too.

They said we were probably still perfected for the original collateral but recommended filing an amendment anyway for safety. Cost us like $3000 for the opinion though.

Ouch, that's expensive just to get comfort on a UCC filing. But I guess it's cheaper than losing your security interest.

That's a good idea. Sounds like it would be a lot cheaper than getting a legal opinion just to assess the risk.

Yeah exactly. Upload your UCC docs and the entity certificates and it'll flag any inconsistencies. Then you can decide if you need to take further action.

Thanks, that's probably the most practical approach. File the amendment first, then worry about the technical perfection issues.

Agree. Better to fix what you can fix now rather than getting paralyzed by what might have gone wrong in the past.

Exactly. And honestly, unless you're dealing with other creditors or a bankruptcy, the technical perfection gap might never matter practically.