(1) On the LIBOR replacement date, the recommended benchmark replacement shall, by operation of law, be the benchmark replacement for any contract, security, or instrument that uses LIBOR as a benchmark and:

(a) Contains no fallback provisions; or

(b) Contains fallback provisions that result in a benchmark replacement, other than a recommended benchmark replacement, that is based in any way on any LIBOR value.

(2) Following the occurrence of a LIBOR discontinuance event, any fallback provisions in a contract, security, or instrument that provide for a benchmark replacement based on or otherwise involving a poll, survey, or inquiries for quotes or information concerning interbank lending rates or any interest rate or dividend rate based on LIBOR shall be disregarded as if not included in such contract, security, or instrument and shall be deemed null and void and without any force or effect.

(3)(a) This subsection shall apply to any contract, security, or instrument that uses LIBOR as a benchmark and contains fallback provisions that permit or require the selection of a benchmark replacement that is:

(i) Based in any way on any LIBOR value; or

(ii) The substantive equivalent of subdivision (1)(a), (b), or (c) of section 8-3104.

(b) A determining person shall have the authority under the LIBOR Transition Act, but shall not be required, to select on or after the occurrence of a LIBOR discontinuance event the recommended benchmark replacement as the benchmark replacement. Such selection of the recommended benchmark replacement shall be:

(i) Irrevocable;

(ii) Made by the earlier of either the LIBOR replacement date or the latest date for selecting a benchmark replacement according to such contract, security, or instrument; and

(iii) Used in any determinations of the benchmark under or with respect to such contract, security, or instrument occurring on or after the LIBOR replacement date.

(4) If a recommended benchmark replacement becomes the benchmark replacement for any contract, security, or instrument pursuant to subsection (1) or (3) of this section, then all benchmark replacement conforming changes that are applicable to such recommended benchmark replacement shall become an integral part of such contract, security, or instrument by operation of law.

(5) The LIBOR Transition Act shall not alter or impair:

(a) Any written agreement by all requisite parties that, retrospectively or prospectively, provides that the contract, security, or instrument shall not be subject to the LIBOR Transition Act without necessarily referring specifically to the act. For purposes of this subdivision, requisite parties means all parties required to amend the terms and provisions of a contract, security, or instrument that would otherwise be altered or affected by the act;

(b) Any contract, security, or instrument that contains fallback provisions that would result in a benchmark replacement that is not based on LIBOR, including, but not limited to, the prime rate or the federal funds rate, except that such contract, security, or instrument shall be subject to subsection (2) of this section;

(c) Any contract, security, or instrument subject to subsection (3) of this section as to which a determining person does not elect to use a recommended benchmark replacement pursuant to subsection (3) of this section or as to which a determining person elects to use a recommended benchmark replacement prior to the occurrence of a LIBOR discontinuance event, except that such contract, security, or instrument shall be subject to subsection (2) of this section; or

(d) The application to a recommended benchmark replacement of any cap, floor, modifier, or spread adjustment to which LIBOR had been subject pursuant to the terms of a contract, security, or instrument.

(6) Notwithstanding the Uniform Commercial Code or any other law of this state, the LIBOR Transition Act shall apply to all contracts, securities, and instruments, including contracts, with respect to commercial transactions and shall not be deemed to be displaced by any other law of this state.