Section 7-8-506 Duty of Securities Intermediary to Exercise Rights as Directed by Entitlement Holder.
90 words·~1 min read·
/al/title-7-commercial-code/part-5-security-entitlements/7-8-506·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A securities intermediary shall exercise rights with respect to a financial asset if directed to do so by an entitlement holder. A securities intermediary satisfies the duty if:
(1)the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or
(2)in the absence of agreement, the securities intermediary either places the entitlement holder in a position to exercise the rights directly or exercises due care in accordance with reasonable commercial standards to follow the direction of the entitlement holder.