§12A-8-102. Definitions.
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Definitions.
(a)In this article:
(1)"Adverse claim" means a claim that a claimant has a
property interest in a financial asset and that it is
a violation of the rights of the claimant for another
person to hold, transfer or deal with the financial
asset;
(2)"Bearer form", as applied to a certificated security,
means a form in which the security is payable to the
bearer of the security certificate according to its
term but not by reason of an indorsement;
(3)"Broker" means a person defined as a broker or dealer
under the federal securities laws, but without
excluding a bank acting in that capacity;
(4)"Certificated security" means a security that is
represented by a certificate;
(5)"Clearing corporation" means:
(i)a person that is registered as a "clearing
agency" under the federal securities laws;
(ii)a federal reserve bank; or
(iii)any other person that provides clearance or
settlement services with respect to financial
assets that would require it to register as a
clearing agency under the federal securities laws
but for an exclusion or exemption from the
registration requirement, if its activities as a
clearing corporation, including promulgation of
rules, are subject to regulation by a federal or
state governmental authority;
(6)"Communicate" means to:
(i)send a signed record; or
(ii)transmit information by any mechanism agreed upon
by the persons transmitting and receiving the
information;
(7)"Entitlement holder" means a person identified in the
records of a securities intermediary as the person
having a security entitlement against the securities
intermediary. If a person acquires a security
entitlement by virtue of paragraph
(2)or
(3)of
subsection
(b)of Section 8-501 of this title, that
person is the entitlement holder;
(8)"Entitlement order" means a notification communicated
to a securities intermediary directing transfer or
redemption of a financial asset to which the
entitlement holder has a security entitlement;
(9)"Financial asset", except as otherwise provided in
Section 8-103 of this title, means:
(i)a security;
(ii)an obligation of a person or a share,
participation or other interest in a person or in
property or an enterprise of a person, which is,
or is of a type, dealt in or traded on financial
markets, or which is recognized in any area in
which it is issued or dealt in as a medium for
investment; or
(iii)any property that is held by a securities
intermediary for another person in a securities
account if the securities intermediary has
expressly agreed with the other person that the
property is to be treated as a financial asset
under this article.
As context requires, the term means either the
interest itself or the means by which a person's claim
to it is evidenced, including a certificated or
uncertificated security, a security certificate, or a
security entitlement;
(10)"Good faith", for purposes of the obligation of good
faith in the performance or enforcement of contracts
or duties within this article, means honesty in fact
and the observance of reasonable commercial standards
of fair dealing;
(11)"Indorsement" means a signature that alone or
accompanied by other words is made on a security
certificate in registered form or on a separate
document for the purpose of assigning, transferring or
redeeming the security or granting a power to assign,
transfer, or redeem it;
(12)"Instruction" means a notification communicated to the
issuer of an uncertificated security which directs
that the transfer of the security be registered or
that the security be redeemed;
(13)"Registered form", as applied to a certificate
security, means a form in which:
(i)the security certificate specifies a person
entitled to the security; and
(ii)a transfer of the security may be registered upon
books maintained for that purpose by or on behalf
of the issuer, or the security certificate so
states;
(14)"Securities intermediary" means:
a clearing corporation; or
a person, including a bank or broker, that in the
ordinary course of its business maintains
securities accounts for others and is acting in
that capacity;
(15)"Security", except as otherwise provided in Section 8-
103 of this title, means an obligation of an issuer or
a share, participation, or other interest in an issuer
or in property or an enterprise of an issuer:
(i)which is represented by a security certificate in
bearer or registered form, or the transfer of
which may be registered upon books maintained for
that purpose by or on behalf of the issuer;
(ii)which is one of a class or series or by its terms
is divisible into a class or series of shares,
participations, interests, or obligations; and
(iii)which:
(A)is, or is of a type, dealt in or traded on
securities exchanges or securities markets;
or
(B)is a medium for investment and by its terms
expressly provides that it is a security
governed by this article;
(16)"Security certificate" means a certificate
representing a security;
(17)"Security entitlement" means the rights and property
interest of an entitlement holder with respect to a
financial asset specified in Part 5 of this article;
and
(18)"Uncertificated security" means a security that is not
represented by a certificate.
(b)The following definitions in this article and other articles apply to this article:
"Appropriate person". Section 8-107.
"Control". Section 8-106.
"Controllable account". Section 1-9-102.
"Controllable electronic record". Section 12-102.
"Controllable payment intangible". Section 1-9-102.
"Delivery". Section 8-301.
"Investment company security". Section 8-103.
"Issuer". Section 8-201.
"Overissue". Section 8-210.
"Protected purchaser". Section 8-303.
"Securities account". Section 8-501.
(c)In addition, Article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
(d)The characterization of a person, business, or transaction for purposes of this article does not determine the characterization of the person, business, or transaction for purposes of any other law, regulation, or rule. Added by Laws 1961, p. 151, § 8-102. Amended by Laws 1970, c. 246, § 11; Laws 1975, c. 127, § 1, emerg. eff. May 13, 1975; Laws 1984, c. 76, § 3, eff. Nov. 1, 1984; Laws 1995, c. 242, § 2, eff. Feb. 1, 1996; Laws 2024, c. 13, § 37, eff. Nov. 1, 2024.