This Article does not provide a specific answer to the question of which State's law applies to the restriction on assignment in the example. However, assuming that under non-UCC choice-of-law principles the effectiveness of the restriction would be governed by the law of State Y, which governs the franchise agreement, the fact that State X's Article 9 governs the secured transaction between SP and D would not override the otherwise applicable law governing the agreement. Of course, to the extent that jurisdictions eventually adopt identical versions of this Article and courts interpret it consistently, the inability to identify the applicable law in circumstances such as those in the example may be inconsequential.

4. Inalienability Under Other Law. Subsection (a) [Maine cite subsection (1)] addresses the question whether property necessarily is transferable by virtue of its inclusion (i.e., its eligibility as collateral) within the scope of Article 9 [Maine cite Article 9-A]. It gives a negative answer, subject to the identified exceptions. The substance of subsection (a) [Maine cite subsection (1)] was implicit under former Article 9.

5. Negative Pledge Covenant. Subsection (b) [Maine cite subsection (2)] is an exception to the general rule in subsection (a) [Maine cite subsection (1)]. It makes clear that in secured transactions under this Article the debtor has rights in collateral (whether legal title or equitable) which it can transfer and which its creditors can reach. It is best explained with an example.