928                              LAWS OF MARYLAND                      [CH. 538

(2)  During the period that goods are in the possession of the
issuer of a negotiable document therefor, a security interest in the
goods is perfected by perfecting a security interest in the document,
and any security interest in the goods otherwise perfected during
such period is subject thereto.

(3)  A security interest in goods in the possession of a bailee other
than one who has issued a negotiable document therefor is perfected
by issuance of a document in the name of the secured party or by the
bailee's receipt of notification of the secured party's interest or by
filing as to the goods.

A security interest in instruments or negotiable documents is
perfected without filing or the taking of possession for a period of
twenty-one days from the time it attaches to the extent that it arises
for new value given under a written security agreement.

(5)  A security interest remains perfected for a period of twenty-
one days without filing where a secured party having a perfected
security interest in an instrument, a negotiable document or goods
in possession of a bailee other than one who has issued a negotiable
document therefor

(a)  makes available to the debtor the goods or documents repre-
senting the goods for the purpose of ultimate sale or exchange or
for the purpose of loading, unloading, storing, shipping, transship-
ping, manufacturing, processing or otherwise dealing with them in
a manner preliminary to their sale or exchange; or

(b)  delivers the instrument to the debtor for the purpose of ulti-
mate sale or exchange or of presentation, collection, renewal or
registration of transfer.

(6)  After the twenty-one day period in subsections (4) and (5)
perfection depends upon compliance with applicable provisions of
this Sub-title.

9—305. When Possession by Secured Party Perfects Security In-
terest Without Filing.

A security interest in letters of credit and advices of credit (sub-
section (2) (a) of Section 5—116), goods, instruments, negotiable
documents or chattel paper may be perfected by the secured party's
taking possession of the collateral. If such collateral other than goods
covered by a negotiable document is held by a bailee, the secured
party is deemed to have possession from the time the bailee receives
notification of the secured party's interest. A security interest is
perfected by possession from the time possession is taken without
relation back and continues only so long as possession is retained,
unless otherwise specified in this Sub-title. The security interest may
be otherwise perfected as provided in this Sub-title before or after
the period of possession by the secured party.

9—306. "Proceeds"; Secured Party's Rights on Disposition of
Collateral.

(1) "Proceeds" includes whatever is received when collateral or
proceeds is sold, exchanged, collected or otherwise disposed of.
The term also includes the account arising when the right to payment