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The lender can demand anytime that the borrower repay him or her. The various State law enactments of the Uniform Commercial Code define what is and what is not a promissory note, in section 3-104(d): … (D) A promise or order other than a check is not an instrument if, at the time it is issued or first comes into possession of a holder, it contains a conspicuous statement, however expressed, to the effect that the promise or order is not negotiable or is not an instrument governed by this Article. Second, conforming changes have been made to Section 154 (clarifying that the consideration paid for stock need not consist of property or cash) and Section 157 (clarifying that the consideration to be paid for stock issued upon the exercise of rights or options need not consist of property or cash). 1953, Â§ 8108.; Â§ 8110 Mesne profits after ejectment.
Difference from IOU [ edit]
One might think that aÂ safe courseÂ is to sell the stock for a promissory note to pay for the stock later, such as when itâsÂ worth more than the sum of the note. The existence of a security interest, agricultural lien, or authority given to a debtor to dispose of or use collateral, without more, does not subject a secured party to liability in contract, tort or otherwise for the debtor’s acts or omissions. ; Â§ 9-403 Agreement not to assert defenses against assignee. (A)â”Value.” Â In this section, “value” has the meaning provided in Section 3-303(a). (B)âAgreement not to assert claim or defense. Â Except as otherwise provided in this section, an agreement between an account debtor and an assignor not to assert against an assignee any claim or defense that the account debtor may have against the assignor is enforceable by an assignee that takes an assignment: (1)âfor value; (2)âin good faith; (3)âwithout notice of a claim of a property or possessory right to the property assigned; and (4)âwithout notice of a defense or claim in recoupment of the type that may be asserted against a person entitled to enforce a negotiable instrument under Section 3-305(a). (C)âWhen subsection (b) not applicable. Â Subsection (b) does not apply to defenses of a type that may be asserted against a holder in due course of a negotiable instrument under Section 3-305(b). (D)âOmission of required statement in consumer transaction. Â In a consumer transaction, if (i) a record evidences the account debtor’s obligation, (ii) law other than this Article requires that the record include a statement to the effect that the rights of an assignee are subject to claims or defenses that the account debtor could assert against the original obligee, and (iii) the record does not include such a statement: (1)âthe record has the same effect as if the record included such a statement; and (2)âthe account debtor may assert against an assignee those claims and defenses that would have been available if the record included such a statement. (E)âRule for individual under other law. Â This section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. (F)âOther law not displaced. Â Except as otherwise provided in subsection (d), this section does not displace law other than this Article which gives effect to an agreement by an account debtor not to assert a claim or defense against an assignee. ; Â§ 9-404 Rights acquired by assignee; claims and defenses against assignee. (A)âAssignee’s rights subject to terms, claims, and defenses; exceptions. Â Unless an account debtor has made an enforceable agreement not to assert defenses or claims, and subject to subsections (b) through (e), the rights of an assignee are subject to: (1)âall terms of the agreement between the account debtor and assignor and any defense or claim in recoupment arising from the transaction that gave rise to the contract; and (2)âany other defense or claim of the account debtor against the assignor which accrues before the account debtor receives a notification of the assignment authenticated by the assignor or the assignee. (B)âAccount debtor’s claim reduces amount owed to assignee. Â Subject to subsection (c) and except as otherwise provided in subsection (d), the claim of an account debtor against an assignor may be asserted against an assignee under subsection (a) only to reduce the amount the account debtor owes. (C)âRule for individual under other law. Â This section is subject to law other than this Article which establishes a different rule for an account debtor who is an individual and who incurred the obligation primarily for personal, family, or household purposes. (D)âOmission of required statement in consumer transaction. Â In a consumer transaction, if a record evidences the account debtor’s obligation, law other than this Article requires that the record include a statement to the effect that the account debtor’s recovery against an assignee with respect to claims and defenses against the assignor may not exceed amounts paid by the account debtor under the record, and the record does not include such a statement, the extent to which a claim of an account debtor against the assignor may be asserted against an assignee is determined as if the record included such a statement. (E)âInapplicability to health-care-insurance receivable. Â This section does not apply to an assignment of a health-care-insurance receivable. ; Â§ 9-405 Modification of assigned contract. (A)âEffect of modification on assignee. Â A modification of or substitution for an assigned contract is effective against an assignee if made in good faith.