§ 9-404. Restrictions on assignment.
A. Commercially Harmful Restrictions on Alienation Invalid. A commercially harmful restriction on alienation (subsections (B), (C) and (D) of this section) of property is invalid.
B. Commercially Harmful Defined for Certain Transactions. In an assignment of accounts other than health-care-insurance receivables, an assignment of chattel paper, an assignment of payment intangibles that is not a sale, or a transfer of promissory notes that is not a sale, the term “commercially harmful restriction on alienation” means a term in an agreement between an account debtor and an assignor, or in a promissory note, to the extent that it:
1. Prohibits, restricts, or requires the consent of the account debtor or person obligated on the promissory note, to the assignment or transfer of, or the creation, attachment, perfection, or enforcement of a security interest in, the affected property; or
2. Provides that such an assignment, transfer, creation, attachment, perfection, or enforcement may give rise to a default or remedy.
C.
1. Commercially Harmful Defined Less Broadly for Other Transactions. In an assignment of a health-care-insurance receivable, a sale of promissory notes, a sale of payment intangibles, or a security interest in other general intangibles (including a contract, permit, or license, or franchise) that is not a sale, the term “commercially harmful restriction on alienation” has the same meaning as in subsection (B) of this section except that the references to enforcement of a security interest appearing in subsection (B)(1) and (2) of this section are excluded.
2. Limitation on Effect in Such Other Transactions. To the extent a commercially harmful restriction on alienation under subsection (C)(1) of this section would otherwise be effective under law other than this Osage Nation Secured Transactions Act, the creation, attachment, or perfection of the security interest:
a. Does not impose a duty or obligation on the account debtor or person obligated on the promissory note;
b. Is not enforceable against the account debtor or person obligated on the promissory note; and
c. Does not entitle the secured party to:
i. Use the debtor’s rights in or to the property;
ii. Have access to trade secrets or confidential information of the account debtor or person obligated on the promissory note; or
iii. Enforce the security interest.
D. Rule of Law as Commercially Harmful Restriction. In addition to the meanings set forth in subsections (B) and (C) of this section, the term “commercially harmful restriction on alienation” includes a rule of law to the extent that it:
1. Requires the consent of a governmental body or official to the assignment or transfer of, or actions described in subsection (B) or (C) of this section, as applicable, regarding a security interest in, the property; or
2. Has any of the effects of a commercially harmful restriction on alienation as defined in subsection (B) or (C) of this section, as applicable.
E. Deferral to Consumer Law; Inapplicability. This section is subject to any different rule in other law for a consumer. In addition, this section does not apply to an assignment of:
1. A claim or right to receive compensation for injuries or sickness as described in 26 U.S.C. § 104(a)(1) or (2), as the same may be amended from time to time;
2. A claim or right to receive benefits under a special needs trust as described in 42 U.S.C. § 1396p(d)(4), as the same may be amended from time to time.
3. A structured settlement payment right; or
4. A right to payment of winnings in a lottery or other game of chance regulated by law other than this Osage Nation Secured Transactions Act. ONCA 07-22, eff. June 18, 2007.