disclosure requirements; penalty. WRITTEN NOTIFICATION AFFECTING FARM PRODUCTS; DISCLOSURE REQUIREMENTS; PENALTY (1) A secured party or a seller of farm products may furnish to the buyer of such farm products, commission merchant, or selling agent, within one (1) year before the sale of the farm products, a written notice of a security interest, organized according to farm products, that: (a) is an original or reproduced copy thereof; (b) contains: (i) the name and address of the secured party; (ii) the name and address of the person indebted to the secured party; (iii) the social security number of the debtor or, in the case of a debtor doing business other than as an individual, the Internal Revenue Service taxpayer identification number of the debtor; and (iv) a description of the farm products subject to the security interest created by the debtor, including the amount of the products where applicable, crop year, county, and a reasonable description of the property; (c) must be amended in writing, within ten (10) days, similarly signed and transmitted, to reflect material changes; (d) will lapse on the expiration period of the statement, or the transmission of a notice signed by the secured party that the statement has lapsed, whichever occurs first; and (e) states any payment obligations imposed on the buyer of farm products, commission merchant, or selling agent by the secured party as conditions for waiver or release of the security interest. (2) For purposes of this section, receipt of notice shall be presumed if notice is sent by certified mail. (3) (a) A secured party who intends to furnish written notification of the existence of a security interest in farm products as provided in this section, shall require the person engaged in farming operations to execute a security agreement containing a provision requiring the person to furnish to the secured party a list of the buyers, commission merchants, and selling agents to or through whom the person may sell the farm products. If the person engaged in farming operations sells the farm product collateral to a buyer or through a commission merchant or selling agent not included on the list, the person engaged in farming operations shall be subject to the penalty provisions of paragraph (b) of this subsection, unless the person: (i) has notified the secured party in writing of the identity of the buyer, commission merchant, or selling agent at least seven (7) days prior to the sale; or (ii) has accounted to the secured party for the proceeds of the sale not later than twenty (20) days after the sale. (b) A person violating the provisions of paragraph (a) of this subsection shall be fined Five Thousand Dollars ($5,000.00) or fifteen percent (15%) of the value or benefit received for the farm product described in the security agreement, whichever is greater. Added by Laws 1987, c. 69, § 7. Amended by Laws 1991, c. 314, § 2, eff. Sept. 1, 1991; Laws 2000, c. 371, § 47, eff. July 1, 2001. Renumbered from § 9-307.7 of this title by Laws 2000, c. 371, § 183, eff. July 1, 2001.
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