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355.8-106 Control.
(1)
(2)
(3)
(4)
(5)
(6)
(7)
A purchaser has "control" of a certificated security in bearer form if the certificated
security is delivered to the purchaser.
A purchaser has "control" of a certificated security in registered form if the
certificated security is delivered to the purchaser, and:
(a) The certificate is indorsed to the purchaser or in blank by an effective
indorsement; or
(b) The certificate is registered in the name of the purchaser, upon original issue
or registration of transfer by the issuer.
A purchaser has "control" of an uncertificated security if:
(a) The uncertificated security is delivered to the purchaser; or
(b) The issuer has agreed that it will comply with instructions originated by the
purchaser without further consent by the registered owner.
A purchaser has "control" of a security entitlement if:
(a) The purchaser becomes the entitlement holder;
(b) The securities intermediary has agreed that it will comply with entitlement
orders originated by the purchaser without further consent by the entitlement
holder; or
(c) Another person has control of the security entitlement on behalf of the
purchaser or, having previously acquired control of the security entitlement,
acknowledges that it has control on behalf of the purchaser.
If an interest in a security entitlement is granted by the entitlement holder to the
entitlement holder's own securities intermediary, the securities intermediary has
control.
A purchaser who has satisfied the requirements of subsection (3) or (4) of this
section has control, even if the registered owner in the case of subsection (3) of this
section or the entitlement holder in the case of subsection (4) of this section retains
the right to make substitutions for the uncertificated security or security entitlement,
to originate instructions or entitlement orders to the issuer or securities
intermediary, or otherwise to deal with the uncertificated security or security
entitlement.
An issuer or a securities intermediary may not enter into an agreement of the kind
described in subsection (3)(b) or (4)(b) of this section without the consent of the
registered owner or entitlement holder, but an issuer or a securities intermediary is
not required to enter into such an agreement even though the registered owner or
entitlement holder so directs. An issuer or securities intermediary that has entered
into such an agreement is not required to confirm the existence of the agreement to
another party unless requested to do so by the registered owner or entitlement
holder.
Effective: July 1, 2001
History: Amended 2000 Ky. Acts ch. 408, sec. 170, effective July 1, 2001. -- Repealed
and reenacted 1996 Ky. Acts ch. 130, sec. 119, effective January 1, 1997. --
Amended 1986 Ky. Acts ch. 118, sec. 14, effective July 1, 1987. -- Created 1958 Ky.
Acts ch. 77, sec. 8-106, effective July 1, 1960.
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