Title 13 — Uniform Commercial Code

This division shall be known and may be cited as Uniform Commercial Code -- Investment Securities.

(1) In this division unless the context otherwise requires (a) A security is an instrument which (i) Is issued in bearer or registered form; and (ii) Is of a type commonly dealt in upon securities exchanges or markets or commonly recognized in any area in which it is issued or de…

A lien upon a security in favor of an issuer thereof is valid against a purchaser only if the right of the issuer to such lien is noted conspicuously on the security.

(1) The provisions of this division which validate a security or compel its issue or reissue do not apply to the extent that validation, issue or reissue would result in over issue; but (a) If an identical security which does not constitute an overissue is reasonably available fo…

(1) Securities governed by this division are negotiable instruments. (2) In any action on a security (a) Unless specifically denied in the pleadings, each signature on the security or in a necessary indorsement is admitted; (b) When the effectiveness of a signature is put in issu…

The validity of a security and the rights and duties of the issuer with respect to registration of transfer are governed by the law (including the conflict of laws rules) of the jurisdiction of organization of the issuer. COMMENT: Section 8106 is identical to Section 8-106 of the…

(1) Unless otherwise agreed, a person obligated to deliver securities may deliver a like number of units of any securities which by nature or usage of trade are the equivalent of the securities he is obligated to deliver. (2) Where, pursuant to the contract to sell or a sale, a s…

(1) With respect to obligations on or defenses to a security issuer includes a person who (a) Places or authorizes the placing of his name on a security (otherwise than as authenticating trustee, registrar, transfer agent or the like) to evidence that it represents a share, parti…

Defense. (1) Even against a purchaser for value and without notice, the terms of a security include those stated on the security and those made part of the security by reference to another instrument, indenture or document or to a constitution, statute, ordinance, rule, regulatio…

(1) After an act or event which creates a right to immediate performance of the principal obligation evidenced by the security or which sets a date on or after which the security is to be presented or surrendered for redemption or exchange, a purchaser is charged with notice of a…

Unless noted conspicuously on the security a restriction on transfer imposed by the issuer even though otherwise lawful is ineffective except against a person with actual knowledge of it.

An unauthorized signature placed on a security prior to or in the course of issue is ineffective except that the signature is effective in favor of a purchaser for value and without notice of the lack of authority if the signing has been done by (a) An authenticating trustee, reg…

(1) Where a security contains the signatures necessary to its issue or transfer but is incomplete in any other respect (a) Any person may complete it by filling in the blanks as authorized; and (b) Even though the blanks are incorrectly filled in, the security as completed is enf…

(1) Prior to due presentment for registration of transfer of a security in registered form the issuer or indenture trustee may treat the registered owner as the person exclusively entitled to vote, to receive notifications and otherwise to exercise all the rights and powers of an…

Transfer Agent. (1) A person placing his signature upon a security as authenticating trustee, registrar, transfer agent or the like warrants to a purchaser for value without notice of the particular defect that (a) The security is genuine; and (b) His own participation in the iss…

Acquired by Bona Fide Purchaser. (1) Upon delivery of a security the purchaser acquires the rights in the security which his transferor had or had actual authority to convey except that a purchaser who has himself been a party to any fraud or illegality affecting the security or …

A bona fide purchaser is a purchaser for value in good faith and without notice of any adverse claim who takes delivery of a security in bearer form or of one in registered form issued to him or indorsed to him or in blank.

Broker means a person engaged for all or part of his time in the business of buying and selling securities, who in the transaction concerned acts for, or buys a security from or sells a security to a customer. Nothing in this division determines the capacity in which a person act…

COL120106 (1) A purchaser (including a broker for the seller or buyer but excluding an intermediary bank) of a security is charged with notice of adverse claims if (a) The security whether in bearer or registered form has been indorsed Afor collection@ or Afor surrender@ or for s…

An act or event which creates a right to immediate performance of the principal obligation evidenced by the security or which sets a date on or after which the security is to be presented or surrendered for redemption or exchange does not of itself constitute any notice of advers…

(1) A person who presents a security for registration of transfer or for payment or exchange warrants to the issuer that he is entitled to the registration, payment or exchange. But a purchaser for value without notice of adverse claims who receives a new, reissued or reregistere…

Indorsement. Where a security in registered form has been delivered to a purchaser without a necessary indorsement he may become a bona fide purchaser only as of the time the indorsement is supplied, but against the transferor the transfer is complete upon delivery and the purcha…

a Guarantor; Partial Assignment. (1) An indorsement of a security in registered form is made when an appropriate person signs on it or on a separate document an assignment or transfer of the security or a power to assign or transfer it or when the COL120106 signature of such pers…

An indorsement of a security whether special or in blank does not constitute a transfer until delivery of the security on which it appears or if the indorsement is on a separate document until delivery of both the document and the security.

An indorsement of a security in bearer form may give notice of adverse claims (Section 8304) but does not otherwise affect any right to registration the holder may possess.

Unless owner has ratified an unauthorized indorsement or is otherwise precluded from asserting its ineffectiveness (a) He may assert its ineffectiveness against the issuer or any purchaser other than a purchaser for value and without notice of adverse claims who has in good faith…

(1) Any person guaranteeing a signature of an indorser of a security warrants that at the time of signing (a) The signature was genuine; and (b) The signer was an appropriate person to indorse (Section 8308); and (c) The signer has legal capacity to sign. But the guarantor does n…

as Holder; Notice of Adverse Claim. (1) Delivery to a purchaser occurs when (a) He or a person designated by him acquires possession of a security; or (b) His broker acquires possession of a security specially indorsed to or issued in the name of the purchaser; or (c) His broker …

COL120106 (1) Unless otherwise agreed where a sale of a security is made on an exchange or otherwise through brokers (a) The selling customer fulfills his duty to deliver when he places such a security in the possession of the selling broker or of a person designated by the broke…

(1) Any person against whom the transfer of a security is wrongful for any reason, including lack of delivery or his incapacity, may against any purchaser except a bona fide purchaser reclaim possession of the security or obtain possession of any new security evidencing all or pa…

on Books. Unless otherwise agreed the transferor must on due demand supply his purchaser with any proof of his authority to transfer or with any other requisite which may be necessary to obtain registration of the transfer of the security but if the transfer is not for value a tr…

(1) No attachment or levy upon a security or any share or other interest evidenced thereby which is outstanding shall be valid until the security is actually seized by the officer making the attachment or levy; but a security which has been surrendered to the issuer may be attach…

An agent or bailee who in good faith (including observance of reasonable commercial standards if he is in the business of buying, selling or otherwise dealing with securities) has received securities and sold, pledged or delivered them according to the instructions of his princip…

(1) A contract for the sale of securities is not enforceable by way of action or defense unless (a) There is some writing signed by the party against whom enforcement is sought or by his authorized agent or broker sufficient to indicate that a contract has been made for sale of a…

(1) If a security (a) Is in the custody of a clearing corporation or of a custodian bank or a nominee of either subject to the instructions of the clearing corporation; and (b) Is in bearer form or indorsed in blank by an appropriate person or registered in the name of the cleari…

(1) Where a security in registered form is presented to the issuer with a request to register transfer, the issuer is under a duty to register the transfer as requested if (a) The security is indorsed by the appropriate person or persons (Section 8308); and (b) Reasonable assuran…

(1) The issuer may require the following assurance that each necessary indorsement (Section 8308) is genuine and effective. (a) In all cases, a guarantee of the signature (subdivision (1) of Section 8312) of the person indorsing; and (b) Where the indorsement is by an agent, appr…

(1) An issuer to whom a security is presented for registration is under a duty to inquire into adverse claims if (a) A written notification of an adverse claim is received at a time and in a manner which affords the issuer a reasonable oppor- tunity to act on it prior to the issu…

(1) Except as otherwise provided in any law relating to the collection of taxes, the issuer is not liable to the owner or any other person suffering loss as a result of the registration of a transfer of a security if (a) There were on or with the security the necessary indorsemen…

(1) Where a security has been lost, apparently destroyed or wrongfully taken and the owner fails to notify the issuer of that fact within a reasonable time after he has notice of it and the issuer registers a transfer of the security before receiving such a notification, the owne…

(1) Where a person acts as authenticating trustee, transfer agent, registrar, or other agent for an issuer in the registration of transfers of its COL120106 securities or in the issue of new securities or in the cancellation of surrendered securities (a) He is under a duty to the…