                                 CODE OF VIRGINIA

TRANSFERABLE RECORDS (§ 59.1-494)

a. In this section, &#8220;transferable record&#8221; means an electronic record
that:

   1. Would be a note under Title 8.3A or a document under Title 8.7 if the
   electronic record were in writing; and

   2. The issuer of the electronic record expressly has agreed is a transferable
   record.

b. A person has control of a transferable record if a system employed for
evidencing the transfer of interests in the transferable record reliably
establishes that person as the person to which the transferable record was
issued or transferred.

c. A system satisfies subsection (b), and a person is deemed to have control of
a transferable record, if the transferable record is created, stored, and
assigned in such a manner that:

   1. A single authoritative copy of the transferable record exists which is
   unique, identifiable, and, except as otherwise provided in subdivisions (4),
   (5), and (6), unalterable;

   2. The authoritative copy identifies the person asserting control as:

A. The person to which the transferable record was issued; or

B. If the authoritative copy indicates that the transferable record has been
transferred, the person to which the transferable record was most recently
transferred;

   3. The authoritative copy is communicated to and maintained by the person
   asserting control or its designated custodian;

   4. Copies or revisions that add or change an identified assignee of the
   authoritative copy can be made only with the consent of the person asserting
   control;

   5. Each copy of the authoritative copy and any copy of a copy is readily
   identifiable as a copy that is not the authoritative copy; and

   6. Any revision of the authoritative copy is readily identifiable as
   authorized or unauthorized.

d. Except as otherwise agreed, a person having control of a transferable record
is the holder, as defined in &#xA7; 8.1A-201 (21), of the transferable record
and has the same rights and defenses as a holder of an equivalent record or
writing under Titles 8.1A through 8.11, including, if the applicable statutory
requirements under &#xA7;&#xA7; 8.3A-302 (a), 8.7-501, or &#xA7; 8.9A-330 are
satisfied, the rights and defenses of a holder in due course, a holder to which
a negotiable document of title has been duly negotiated, or a purchaser,
respectively. Delivery, possession, and endorsement are not required to obtain
or exercise any of the rights under this subsection.

e. Except as otherwise agreed, an obligor under a transferable record has the
same rights and defenses as an equivalent obligor under equivalent records or
writings under Titles 8.1A through 8.11.

f. If requested by a person against which enforcement is sought, the person
seeking to enforce the transferable record shall provide reasonable proof that
the person is in control of the transferable record. Proof may include access to
the authoritative copy of the transferable record and related business records
sufficient to review the terms of the transferable record and to establish the
identity of the person having control of the transferable record.

HISTORY: 2000, c. 995; 2001, c. 86; 2003, c. 353.