UCC filing for security agreement canada equipment - debtor name issues

This exactly. Had same issue with a Canadian parent company last year. Spent weeks going back and forth until I realized I needed to use the US subsidiary name exactly as shown on their state registration.

But what if the security agreement itself uses the Canadian entity name? Doesn't that create a mismatch between the security agreement and the UCC-1?

Already tried that but there are actually two entities listed - the Canadian parent and a US subsidiary. The equipment is titled to the subsidiary but the security agreement names the parent company. Which entity should be the debtor on the UCC-1?

You probably need to file against both entities to be safe. If the subsidiary owns the equipment but the parent guaranteed the debt, file separate UCC-1s for each entity as debtor.

Wait that doesn't sound right... you can't just file multiple UCC-1s for the same collateral. Need to figure out who actually owns the equipment first.

Never heard of that service but sounds useful. How accurate is it with catching these name matching issues?

Pretty thorough from what I've seen. It caught a middle initial discrepancy that I completely missed when doing manual comparison. Would have been another rejected filing otherwise.

That's a good point about amending the security agreement. But with a $2.8M deal and tight deadlines, that could take weeks to get all parties to re-sign.

True, but better than having an unperfected lien. At least file a placeholder UCC-1 against the entity you think is correct, then you can amend later if needed.

Actually you can't really do a 'placeholder' UCC-1... if the debtor name is wrong the filing is ineffective. Better to get it right the first time.

Interesting - I'll look into that. Our state filing guide doesn't mention foreign entity provisions but maybe there's something in the UCC statutes.

Most states follow the standard UCC Article 9 rules pretty strictly. Foreign entity provisions are rare and usually only apply to very specific circumstances.

How did you determine the actual ownership structure? Corporate records search or something else?

Had to pull corporate records from both countries plus the equipment title documentation. Took about a week to sort through everything but found the real owner.

This is why I always do a full entity verification before drafting security agreements. Too many surprises otherwise.

First rejection was 'debtor name not found in records' and second was 'debtor name format invalid'. Both pretty vague unfortunately.

Those are different issues. First one suggests the entity isn't registered in your state at all. Second suggests formatting problems with how you entered the name.

Good luck getting through to anyone. I've been on hold for 2 hours before just to ask a simple question about continuation timing.

True, but for a $2.8M deal it's worth the hold time. Better than risking an ineffective filing.

Some states have email support for UCC questions. Might be faster than phone if your state offers it.

How much does something like that cost? Seems like it could save a lot of filing fees and time.

Haven't looked at pricing but definitely cheaper than multiple rejected filings and the stress of missing perfection deadlines. The time savings alone made it worth it.

Good point. I focused so much on the debtor name that I didn't consider other fields might be problematic. The collateral description does reference the original Canadian documentation.

There you go. The collateral description needs to make sense in the context of US law and your security agreement. References to Canadian documentation might be confusing the filing system.

Exactly! Keep the collateral description generic enough to cover the equipment but specific enough to identify it. Don't reference foreign documents in the UCC-1 itself.