(a) The person entitled under the electronic document surrenders control of the document to the issuer; and

(b) The tangible document when issued contains a statement that it is issued in substitution for the electronic document.

(2) Upon issuance of a tangible document of title in substitution for an electronic document of title in accordance with subsection (1) of this section:

(a) The electronic document ceases to have any effect or validity; and

(b) The person that procured issuance of the tangible document warrants to all subsequent persons entitled under the tangible document that the warrantor was a person entitled under the electronic document when the warrantor surrendered control of the electronic document to the issuer.

(3) Upon request of a person entitled under a tangible document of title, the issuer of the tangible document may issue an electronic document of title as a substitute for the tangible document if:

(a) The person entitled under the tangible document surrenders possession of the document to the issuer; and

(b) The electronic document when issued contains a statement that it is issued in substitution for the tangible document.

(4) Upon issuance of an electronic document of title in substitution for a tangible document of title in accordance with subsection (3) of this section:

(a) The tangible document ceases to have any effect or validity; and

(b) The person that procured issuance of the electronic document warrants to all subsequent persons entitled under the electronic document that the warrantor was a person entitled under the tangible document when the warrantor surrendered possession of the tangible document to the issuer. [1961 c.726 §77.1050; 2009 c.181 §53]