Illinois Compiled Statutes
810 ILCS 5/ - Uniform Commercial Code.
Article 8 - Investment Securities

(810 ILCS 5/Art. 8 heading)

 
(810 ILCS 5/Art. 8 Pt. 1 heading)

 
(810 ILCS 5/8-101) (from Ch. 26, par. 8-101)
Sec. 8-101.
Short title.
This Article may be cited as Uniform Commercial
Code--Investment Securities.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-102) (from Ch. 26, par. 8-102)
Sec. 8-102.
Definitions.
(a) In this Article:
(b) Other definitions applying to this Article and the Sections in
which they appear are:
Appropriate person Section 8-107
Control Section 8-106
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.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-103) (from Ch. 26, par. 8-103)
Sec. 8-103. Rules for determining whether certain
obligations and interests are securities or financial
assets.
(a) A share or similar equity interest issued by a corporation,
business trust, joint stock company, or similar entity is a security.
(b) An "investment company security" is a security. "Investment
company security" means a share or similar equity interest issued by an
entity that is registered as an investment company under the federal
investment company laws, an interest in a unit investment trust that is so
registered, or a face-amount certificate issued by a face-amount certificate
company that is so registered. Investment company security does not
include an insurance policy or endowment policy or annuity contract issued
by an insurance company.
(c) An interest in a partnership or limited liability company is not a
security unless it is dealt in or traded on securities exchanges or in
securities markets, its terms expressly provide that it is a security governed
by this
Article, or it is an investment company security. However, an interest in a
partnership or limited liability company is a financial asset if it is held in
a securities account.
(d) A writing that is a security certificate is governed by this Article and
not by Article 3, even though it also meets the requirements of that
Article. However, a negotiable instrument governed by Article 3 is a financial
asset if it is held in a securities account.
(e) An option or similar obligation issued by a clearing corporation
to its participants is not a security, but is a financial asset.
(f) A commodity contract, as defined in Section 9-102(a)(15),
is not a
security or a financial asset.
(g) A document of title is not a financial asset unless Section 8-102(a)(9)(iii) applies.

(Source: P.A. 95-895, eff. 1-1-09.)
 
(810 ILCS 5/8-104) (from Ch. 26, par. 8-104)
Sec. 8-104.

Acquisition of security or financial
asset or interest therein.
(a) A person acquires a security or an interest therein, under this
Article, if:
(b) A person acquires a financial asset, other than a security, or an
interest therein, under this Article, if the person acquires a security
entitlement to the financial asset.
(c) A person who acquires a security entitlement to a security or
other financial asset has the rights specified in Part 5, but is a purchaser of
any security, security entitlement, or other financial asset held by the
securities intermediary only to the extent provided in Section 8-503.
(d) Unless the context shows that a different meaning is intended, a
person who is required by other law, regulation, rule, or agreement to
transfer, deliver, present, surrender, exchange, or otherwise put in the
possession of another person a security or financial asset satisfies that
requirement by causing the other person to acquire an interest in the
security or financial asset pursuant to subsection (a) or (b).

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-105) (from Ch. 26, par. 8-105)
Sec. 8-105.
Notice of adverse claim.
(a) A person has notice of an adverse claim if:
(b) Having knowledge that a financial asset or interest therein is or
has been transferred by a representative imposes no duty of inquiry into the
rightfulness of a transaction and is not notice of an adverse claim. However,
a person who knows that a representative has transferred a financial asset or
interest therein in a transaction that is, or whose proceeds are being used,
for the individual benefit of the representative or otherwise in breach of
duty has notice of an adverse claim.
(c) An act or event that creates a right to immediate performance
of the principal obligation represented by a security certificate or sets a
date
on or after which the certificate is to be presented or surrendered for
redemption or exchange does not itself constitute notice of an adverse claim
except in the case of a transfer more than:
(d) A purchaser of a certificated security has notice of an adverse
claim if the security certificate:
(e) Filing of a financing statement under Article 9 is not notice of
an adverse claim to a financial asset.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-106) (from Ch. 26, par. 8-106)
Sec. 8-106. Control.
(a) A purchaser has "control" of a certificated security in bearer
form if the certificated security is delivered to the purchaser.
(b) A purchaser has "control" of a certificated security in registered
form if the certificated security is delivered to the purchaser, and:
(c) A purchaser has "control" of an uncertificated security if:
(d) A purchaser has "control" of a security entitlement if:
(e) 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.
(f) A purchaser who has satisfied the requirements of subsection (c) or
(d) has control even if the registered owner in the case of subsection (c)
or the entitlement holder in the case of subsection (d) 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.
(g) An issuer or a securities intermediary may not enter into an
agreement of the kind described in subsection (c)(2) or (d)(2) 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.

(Source: P.A. 95-331, eff. 8-21-07.)
 
(810 ILCS 5/8-107) (from Ch. 26, par. 8-107)
Sec. 8-107.

Whether indorsement, instruction, or
entitlement order is effective.
(a) "Appropriate person" means:
(b) An indorsement, instruction, or entitlement order is effective if:
(c) An indorsement, instruction, or entitlement order made by a
representative is effective even if:
(d) If a security is registered in the name of or specially indorsed to
a person described as a representative, or if a securities account is
maintained in the name of a person described as a representative, an
indorsement, instruction, or entitlement order made by the person is
effective even though the person is no longer serving in the described
capacity.
(e) Effectiveness of an indorsement, instruction, or entitlement
order is determined as of the date the indorsement, instruction, or
entitlement order is made, and an indorsement, instruction, or entitlement
order does not become ineffective by reason of any later change of
circumstances.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-108) (from Ch. 26, par. 8-108)
Sec. 8-108.
Warranties in direct holding.
(a) A person who transfers a certificated security to a purchaser for
value warrants to the purchaser, and an indorser, if the transfer is by
indorsement, warrants to any subsequent purchaser, that:
(b) A person who originates an instruction for registration of
transfer of an uncertificated security to a purchaser for value warrants to the
purchaser that:
(c) A person who transfers an uncertificated security to a purchaser
for value and does not originate an instruction in connection with the
transfer warrants that:
(d) A person who indorses a security certificate warrants to the
issuer that:
(e) A person who originates an instruction for registration of
transfer of an uncertificated security warrants to the issuer that:
(f) A person who presents a certificated security for registration of
transfer or for payment or exchange warrants to the issuer that the person is
entitled to the registration, payment, or exchange, but a purchaser for value
and without notice of adverse claims to whom transfer is registered warrants
only that the person has no knowledge of any unauthorized signature in a
necessary indorsement.
(g) If a person acts as agent of another in delivering a certificated
security to a purchaser, the identity of the principal was known to the person
to whom the certificate was delivered, and the certificate delivered by the
agent was received by the agent from the principal or received by the agent
from another person at the direction of the principal, the person delivering
the security certificate warrants only that the delivering person has authority
to act for the principal and does not know of any adverse claim to the
certificated security.
(h) A secured party who redelivers a security certificate received, or
after payment and on order of the debtor delivers the security certificate to
another person, makes only the warranties of an agent under subsection (g).
(i) Except as otherwise provided in subsection (g), a broker acting
for a customer makes to the issuer and a purchaser the warranties provided
in subsections (a) through (f). A broker that delivers a security certificate
to
its customer, or causes its customer to be registered as the owner of an
uncertificated security, makes to the customer the warranties provided in
subsection (a) or (b), and has the rights and privileges of a purchaser under
this Section. The warranties of and in favor of the broker acting as an agent
are in addition to applicable warranties given by and in favor of the
customer.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-109)
Sec. 8-109.
Warranties in indirect holding.
(a) A person who originates an entitlement order to a securities
intermediary warrants to the securities intermediary that:
(b) A person who delivers a security certificate to a securities
intermediary for credit to a securities account or originates an instruction
with respect to an uncertificated security directing that the uncertificated
security be credited to a securities account makes to the securities
intermediary the warranties specified in Section 8-108(a) or (b).
(c) If a securities intermediary delivers a security certificate to its
entitlement holder or causes its entitlement holder to be registered as the
owner of an uncertificated security, the securities intermediary makes to the
entitlement holder the warranties specified in Section 8-108(a) or (b).

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-110)
Sec. 8-110.
Applicability; choice of law.
(a) The local law of the issuer's jurisdiction, as specified in
subsection (d), governs:
(b) The local law of the securities intermediary's jurisdiction, as
specified in subsection (e), governs:
(c) The local law of the jurisdiction in which a security certificate is
located at the time of delivery governs whether an adverse claim can be
asserted against a person to whom the security certificate is delivered.
(d) "Issuer's jurisdiction" means the jurisdiction under which the
issuer of the security is organized or, if permitted by the law of that
jurisdiction, the law of another jurisdiction specified by the issuer. An
issuer
organized under the law of this State may specify the law of another
jurisdiction as the law governing the matters specified in subsection (a)(2)
through (5).
(e) The following rules determine a "securities intermediary's
jurisdiction" for purposes of this Section:
(f) A securities intermediary's jurisdiction is not determined by the
physical location of certificates representing financial assets, or by the
jurisdiction in which is organized the issuer of the financial asset with
respect to which an entitlement holder has a security entitlement, or by the
location of facilities for data processing or other record keeping concerning
the account.

(Source: P.A. 91-893, eff. 7-1-01.)
 
(810 ILCS 5/8-111)
Sec. 8-111.
Clearing corporation rules.
A rule
adopted by a clearing corporation governing rights and obligations among
the clearing corporation and its participants in the clearing corporation is
effective even if the rule conflicts with this Code and affects another
party who does not consent to the rule.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-112)
Sec. 8-112.
Creditor's legal process.
(a) The interest of a debtor in a certificated security may be
reached by a creditor only by actual seizure of the security certificate by the
officer making the attachment or levy, except as otherwise provided in
subsection (d). However, a certificated security for which the certificate has
been surrendered to the issuer may be reached by a creditor by legal process
upon the issuer.
(b) The interest of a debtor in an uncertificated security may be
reached by a creditor only by legal process upon the issuer at its chief
executive office in the United States, except as otherwise provided in
subsection (d).
(c) The interest of a debtor in a security entitlement may be
reached by a creditor only by legal process upon the securities intermediary
with whom the debtor's securities account is maintained, except as otherwise
provided in subsection (d).
(d) The interest of a debtor in a certificated security for which the
certificate is in the possession of a secured party, or in an uncertificated
security registered in the name of a secured party, or a security entitlement
maintained in the name of a secured party, may be reached by a creditor by
legal process upon the secured party.
(e) A creditor whose debtor is the owner of a certificated security,
uncertificated security, or security entitlement is entitled to aid from a
court
of competent jurisdiction, by injunction or otherwise, in reaching the
certificated security, uncertificated security, or security entitlement or in
satisfying the claim by means allowed at law or in equity in regard to
property that cannot readily be reached by other legal process.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-113)
Sec. 8-113.
Statute of frauds inapplicable.
A contract
or modification of a contract for the sale or purchase of a security is
enforceable whether or not there is a writing signed or record authenticated
by a party against whom enforcement is sought, even if the contract or
modification is not capable of performance within one year of its making.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-114)
Sec. 8-114.

Evidentiary rules concerning
certificated securities.
The following rules apply in an action on a
certificated security against the issuer:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-115)
Sec. 8-115.

Securities intermediary and others not
liable to adverse claimant. A securities intermediary that has
transferred a financial asset pursuant to an effective entitlement order, or a
broker or other agent or bailee that has dealt with a financial asset at the
direction of its customer or principal, is not liable to a person having an
adverse claim to the financial asset, unless the securities intermediary, or
broker or other agent or bailee:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-116)
Sec. 8-116.

Securities intermediary as purchaser
for value. A securities intermediary that receives a financial asset and
establishes a security entitlement to the financial asset in favor of an
entitlement holder is a purchaser for value of the financial asset. A
securities intermediary that acquires a security entitlement to a financial
asset from another securities intermediary acquires the security entitlement
for value if the securities intermediary acquiring the security entitlement
establishes a security entitlement to the financial asset in favor of an
entitlement holder.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/Art. 8 Pt. 2 heading)

 
(810 ILCS 5/8-201) (from Ch. 26, par. 8-201)
Sec. 8-201.
Issuer.
(a) With respect to an obligation on or a defense to a security, an
"issuer" includes a person that:
(b) With respect to an obligation on or defense to a security, a
guarantor is an issuer to the extent of its guaranty, whether or not its
obligation is noted on a security certificate.
(c) With respect to a registration of a transfer, issuer means a
person on whose behalf transfer books are maintained.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-202) (from Ch. 26, par. 8-202)
Sec. 8-202.

Issuer's responsibility and defenses; notice of defect or
defense.
(a) Even against a purchaser for value and without notice, the
terms of a certificated security include terms stated on the certificate and
terms made part of the security by reference on the certificate to another
instrument, indenture, or document or to a constitution, statute, ordinance,
rule, regulation, order, or the like, to the extent the terms referred to do
not conflict with terms stated on the certificate. A reference under this
subsection does not of itself charge a purchaser for value with notice of a
defect going to the validity of the security, even if the certificate expressly
states that a person accepting it admits notice. The terms of an
uncertificated security include those stated in any instrument, indenture, or
document or in a constitution, statute, ordinance, rule, regulation, order, or
the like, pursuant to which the security is issued.
(b) The following rules apply if an issuer asserts that a security is
not valid:
(c) Except as otherwise provided in Section 8-205, lack of
genuineness of a certificated security is a complete defense, even against a
purchaser for value and without notice.
(d) All other defenses of the issuer of a security, including
nondelivery and conditional delivery of a certificated security, are
ineffective against a purchaser for value who has taken the certificated
security without notice of the particular defense.
(e) This Section does not affect the right of a party to cancel a
contract for a security "when, as and if issued" or "when distributed" in the
event of a material change in the character of the security that is the subject
of the contract or in the plan or arrangement pursuant to which the security
is to be issued or distributed.
(f) If a security is held by a securities intermediary against whom an
entitlement holder has a security entitlement with respect to the security, the
issuer may not assert any defense that the issuer could not assert if the
entitlement holder held the security directly.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-203) (from Ch. 26, par. 8-203)
Sec. 8-203.
Staleness as notice of defect or defense.
After an act or event, other than a call that has been revoked,
creating a right to immediate performance of the principal obligation
represented by a certificated security or setting 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 any defect in its issue or defense of the
issuer, if the act or event:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-204) (from Ch. 26, par. 8-204)
Sec. 8-204.
Effect of issuer's restriction on transfer.
A restriction on transfer of a security imposed by the issuer,
even if otherwise lawful, is ineffective against a person without knowledge of
the restriction unless:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-205) (from Ch. 26, par. 8-205)
Sec. 8-205.

Effect of unauthorized signature on
security certificate. An unauthorized signature placed on a security
certificate before or in the course of issue is ineffective, but the signature
is effective in favor of a purchaser for value of the certificated security if
the purchaser is without notice of the lack of authority and the signing has
been done by:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-206) (from Ch. 26, par. 8-206)
Sec. 8-206.

Completion or alteration of security
certificate.
(a) If a security certificate contains the signatures necessary to its
issue or transfer but is incomplete in any other respect:
(b) A complete security certificate that has been improperly altered, even
if fraudulently, remains enforceable, but only according to its original
terms.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-207) (from Ch. 26, par. 8-207)
Sec. 8-207.
Rights and duties of issuer with respect to registered owners.
(a) Before due presentment for registration of transfer of a
certificated security in registered form or of an instruction requesting
registration of transfer of an uncertificated security, the issuer or indenture
trustee may treat the registered owner as the person exclusively entitled to
vote, receive notifications, and otherwise exercise all the rights and powers
of an owner.
(b) This Article does not affect the liability of the registered owner
of a security for a call, assessment, or the like.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-208) (from Ch. 26, par. 8-208)
Sec. 8-208.

Effect of signature of authenticating trustee, registrar,
or transfer agent.
(a) A person signing a security certificate as authenticating trustee,
registrar, transfer agent, or the like, warrants to a purchaser for value of
the certificated security, if the purchaser is without notice of a particular
defect, that:
(b) Unless otherwise agreed, a person signing under subsection (a) does
not assume responsibility for the validity of the security in other respects.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-209)
Sec. 8-209.
Issuer's lien.
A lien in favor of an issuer upon a
certificated security is valid against a purchaser only if the right of the
issuer to the lien is noted conspicuously on the security certificate.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-210)
Sec. 8-210.
Overissue.
(a) In this Section, "overissue" means the issue of securities in
excess of the amount the issuer has corporate power to issue, but an
overissue does not occur if appropriate action has cured the overissue.
(b) Except as otherwise provided in subsections (c) and (d), the
provisions of this Article which validate a security or compel its issue or
reissue do not apply to the extent that validation, issue, or reissue would
result in overissue.
(c) If an identical security not constituting an overissue is
reasonably available for purchase, a person entitled to issue or validation
may compel the issuer to purchase the security and deliver it if certificated
or register its transfer if uncertificated, against surrender of any security
certificate the person holds.
(d) If a security is not reasonably available for purchase, a person
entitled to issue or validation may recover from the issuer the price the
person or the last purchaser for value paid for it with interest from the date
of the person's demand.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/Art. 8 Pt. 3 heading)

 
(810 ILCS 5/8-301) (from Ch. 26, par. 8-301)
Sec. 8-301.
Delivery.
(a) Delivery of a certificated security to a purchaser occurs when:
(b) Delivery of an uncertificated security to a purchaser occurs
when:
(Source: P.A. 91-893, eff. 7-1-01.)
 
(810 ILCS 5/8-302) (from Ch. 26, par. 8-302)
Sec. 8-302.
Rights of purchaser.
(a) Except as otherwise provided in subsections (b) and (c), of a
certificated or uncertificated security acquires all rights in the security
that the transferor had or had
power to transfer.
(b) A purchaser of a limited interest acquires rights only to the
extent of the interest purchased.
(c) A purchaser of a certificated security who as a previous holder
had notice of an adverse claim does not improve its position by taking from
a protected purchaser.

(Source: P.A. 91-893, eff. 7-1-01.)
 
(810 ILCS 5/8-303) (from Ch. 26, par. 8-303)
Sec. 8-303.
Protected purchaser.
(a) "Protected purchaser" means a purchaser of a certificated or
uncertificated security, or of an interest therein, who:
(b) In addition to acquiring the rights of a purchaser, a protected
purchaser also acquires its interest in the security free of any adverse
claim.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-304) (from Ch. 26, par. 8-304)
Sec. 8-304.
Indorsement.
(a) An indorsement may be in blank or special. An indorsement in
blank includes an indorsement to bearer. A special indorsement specifies to
whom a security is to be transferred or who has power to transfer it. A
holder may convert a blank indorsement to a special indorsement.
(b) An indorsement purporting to be only of part of a security
certificate representing units intended by the issuer to be separately
transferable is effective to the extent of the indorsement.
(c) An indorsement, whether special or in blank, does not
constitute a transfer until delivery of the certificate on which it appears or,
if
the indorsement is on a separate document, until delivery of both the
document and the certificate.
(d) If a security certificate in registered form has been delivered to
a purchaser without a necessary indorsement, the purchaser may become a
protected purchaser only when the indorsement is supplied. However,
against a transferor, a transfer is complete upon delivery and the purchaser
has a specifically enforceable right to have any necessary indorsement
supplied.
(e) An indorsement of a security certificate in bearer form may give
notice of an adverse claim to the certificate, but it does not otherwise affect
a right to registration that the holder possesses.
(f) Unless otherwise agreed, a person making an indorsement
assumes only the obligations provided in Section 8-108 and not an obligation
that the security will be honored by the issuer.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-305) (from Ch. 26, par. 8-305)
Sec. 8-305.
Instruction.
(a) If an instruction has been originated by an appropriate person
but is incomplete in any other respect, any person may complete it as
authorized and the issuer may rely on it as completed, even though it has
been completed incorrectly.
(b) Unless otherwise agreed, a person initiating an instruction
assumes only the obligations imposed by Section 8-108 and not an obligation
that the security will be honored by the issuer.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-306) (from Ch. 26, par. 8-306)
Sec. 8-306.

Effect of guaranteeing signature,
indorsement, or instruction.
(a) A person who guarantees a signature of an indorser of a
security certificate warrants that at the time of signing:
(b) A person who guarantees a signature of the originator of an
instruction warrants that at the time of signing:
(c) A person who specially guarantees the signature of an originator
of an instruction makes the warranties of a signature guarantor under
subsection (b) and also warrants that at the time the instruction is presented
to the issuer:
(d) A guarantor under subsections (a) and (b) or a special
guarantor under subsection (c) does not otherwise warrant the rightfulness
of the transfer.
(e) A person who guarantees an indorsement of a security
certificate makes the warranties of a signature guarantor under subsection
(a) and also warrants the rightfulness of the transfer in all respects.
(f) A person who guarantees an instruction requesting the transfer
of an uncertificated security makes the warranties of a special signature
guarantor under subsection (c) and also warrants the rightfulness of the
transfer in all respects.
(g) An issuer may not require a special guaranty of signature, a
guaranty of indorsement, or a guaranty of instruction as a condition to
registration of transfer.
(h) The warranties under this Section are made to a person taking
or dealing with the security in reliance on the guaranty, and the guarantor is
liable to the person for loss resulting from their breach. An indorser or
originator of an instruction whose signature, indorsement, or instruction has
been guaranteed is liable to a guarantor for any loss suffered by the
guarantor as a result of breach of the warranties of the guarantor.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-307) (from Ch. 26, par. 8-307)
Sec. 8-307.

Purchaser's right to requisites for
registration of transfer. Unless otherwise agreed, the transferor
of a security on due demand shall supply the purchaser with proof of
authority to transfer or with any other requisite necessary to obtain
registration of the transfer of the security, but if the transfer is not for
value, a transferor need not comply unless the purchaser pays the necessary
expenses. If the transferor fails within a reasonable time to comply with the
demand, the purchaser may reject or rescind the transfer.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-308) (from Ch. 26, par. 8-308)
Sec. 8-308.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-309) (from Ch. 26, par. 8-309)
Sec. 8-309.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-310) (from Ch. 26, par. 8-310)
Sec. 8-310.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-311) (from Ch. 26, par. 8-311)
Sec. 8-311.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-312) (from Ch. 26, par. 8-312)
Sec. 8-312.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-313) (from Ch. 26, par. 8-313)
Sec. 8-313.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-314) (from Ch. 26, par. 8-314)
Sec. 8-314.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-315) (from Ch. 26, par. 8-315)
Sec. 8-315.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-316) (from Ch. 26, par. 8-316)
Sec. 8-316.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-317) (from Ch. 26, par. 8-317)
Sec. 8-317.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-318) (from Ch. 26, par. 8-318)
Sec. 8-318.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-319) (from Ch. 26, par. 8-319)
Sec. 8-319.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-320) (from Ch. 26, par. 8-320)
Sec. 8-320.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-321) (from Ch. 26, par. 8-321)
Sec. 8-321.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/Art. 8 Pt. 4 heading)

 
(810 ILCS 5/8-401) (from Ch. 26, par. 8-401)
Sec. 8-401.
Duty of issuer to register transfer.
(a) If a certificated security in registered form is presented to an
issuer with a request to register transfer or an instruction is presented to an
issuer with a request to register transfer of an uncertificated security, the
issuer shall register the transfer as requested if:
(b) If an issuer is under a duty to register a transfer of a security,
the issuer is liable to a person presenting a certificated security or an
instruction for registration or to the person's principal for loss resulting
from
unreasonable delay in registration or failure or refusal to register the
transfer.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-402) (from Ch. 26, par. 8-402)
Sec. 8-402.

Assurance that indorsement or
instruction is effective.
(a) An issuer may require the following assurance that each
necessary indorsement or each instruction is genuine and authorized:
(b) An issuer may elect to require reasonable assurance beyond
that specified in this Section.
(c) In this Section:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-403) (from Ch. 26, par. 8-403)
Sec. 8-403.
Demand that issuer not register transfer.
(a) A person who is an appropriate person to make an indorsement
or originate an instruction may demand that the issuer not register transfer
of a security by communicating to the issuer a notification that identifies the
registered owner and the issue of which the security is a part and provides
an address for communications directed to the person making the demand.
The demand is effective only if it is received by the issuer at a time and in a
manner affording the issuer reasonable opportunity to act on it.
(b) If a certificated security in registered form is presented to an
issuer with a request to register transfer or an instruction is presented to an
issuer with a request to register transfer of an uncertificated security after
a demand that the issuer not register transfer has become effective, the issuer
shall promptly communicate to (i) the person who initiated the demand at
the address provided in the demand and (ii) the person who presented the
security for registration of transfer or initiated the instruction requesting
registration of transfer a notification stating that:
(c) The period described in subsection (b)(3) may not exceed 30
days after the date of communication of the notification. A shorter period
may be specified by the issuer if it is not manifestly unreasonable.
(d) An issuer is not liable to a person who initiated a demand that
the issuer not register transfer for any loss the person suffers as a result of
registration of a transfer pursuant to an effective indorsement or instruction
if the person who initiated the demand does not, within the time stated in
the issuer's communication, either:
(e) This Section does not relieve an issuer from liability for
registering transfer pursuant to an indorsement or instruction that was not
effective.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-404) (from Ch. 26, par. 8-404)
Sec. 8-404.
Wrongful registration.
(a) Except as otherwise provided in Section 8-406, an issuer is
liable for wrongful registration of transfer if the issuer has registered a
transfer of a security to a person not entitled to it, and the transfer was
registered:
(b) An issuer that is liable for wrongful registration of transfer
under subsection (a) on demand shall provide the person entitled to the
security with a like certificated or uncertificated security, and any payments
or distributions that the person did not receive as a result of the wrongful
registration. If an overissue would result, the issuer's liability to provide
the person with a like security is governed by Section 8-210.
(c) Except as otherwise provided in subsection (a) or in a law
relating to the collection of taxes, an issuer is not liable to an owner or
other person suffering loss as a result of the registration of a transfer of a
security if registration was made pursuant to an effective indorsement or
instruction.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-405) (from Ch. 26, par. 8-405)
Sec. 8-405.

Replacement of lost, destroyed, or
wrongfully taken security certificate.
(a) If an owner of a certificated security, whether in registered or
bearer form, claims that the certificate has been lost, destroyed, or
wrongfully taken, the issuer shall issue a new certificate if the owner:
(b) If, after the issue of a new security certificate, a protected
purchaser of the original certificate presents it for registration of transfer,
the issuer shall register the transfer unless an overissue would result. In
that case, the issuer's liability is governed by Section 8-210. In addition to
any rights on the indemnity bond, an issuer may recover the new certificate
from a person to whom it was issued or any person taking under that person,
except a protected purchaser.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-406) (from Ch. 26, par. 8-406)
Sec. 8-406.

Obligation to notify issuer of lost, destroyed, or wrongfully
taken security certificate. If a security certificate has been lost,
apparently destroyed, or wrongfully taken, and the owner fails to notify the
issuer of that fact within a reasonable time after the owner has notice of it
and the issuer registers a transfer of the security before receiving
notification, the owner may not assert against the issuer a claim for
registering the transfer under Section 8-404 or a claim to a new security
certificate under Section 8-405.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-407) (from Ch. 26, par. 8-407)
Sec. 8-407.
Authenticating trustee, transfer agent, and registrar.
A
person acting as authenticating trustee, transfer agent, registrar, or other
agent for an issuer in the registration of a
transfer of its securities, in the issue of new security certificates or
uncertificated securities, or in the cancellation of surrendered security
certificates has the same obligation to the holder or owner of a certificated
or uncertificated security with regard to the particular functions performed
as the issuer has in regard to those functions.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-408) (from Ch. 26, par. 8-408)
Sec. 8-408.
(Repealed).

(Source: P.A. 85-997. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-409) (from Ch. 26, par. 8-409)
Sec. 8-409.
(Repealed).

(Source: P.A. 85-1209. Repealed by P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/Art. 8 Pt. 5 heading)

 
(810 ILCS 5/8-501)
Sec. 8-501.

Securities account; acquisition of
security entitlement from securities intermediary.
(a) "Securities account" means an account to which a financial asset
is or may be credited in accordance with an agreement under which the
person maintaining the account undertakes to treat the person for whom the
account is maintained as entitled to exercise the rights that comprise the
financial asset.
(b) Except as otherwise provided in subsections (d) and (e), a
person acquires a security entitlement if a securities intermediary:
(c) If a condition of subsection (b) has been met, a person has a
security entitlement even though the securities intermediary does not itself
hold the financial asset.
(d) If a securities intermediary holds a financial asset for another
person, and the financial asset is registered in the name of, payable to the
order of, or specially indorsed to the other person, and has not been
indorsed to the securities intermediary or in blank, the other person is
treated as holding the financial asset directly rather than as having a
security entitlement with respect to the financial asset.
(e) Issuance of a security is not establishment of a security
entitlement.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-502)
Sec. 8-502.

Assertion of adverse claim against
entitlement holder. An action based on an adverse claim to a
financial asset, whether framed in conversion, replevin, constructive trust,
equitable lien, or other theory, may not be asserted against a person who
acquires a security entitlement under Section 8-501 for value and without
notice of the adverse claim.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-503)
Sec. 8-503.

Property interest of entitlement
holder in financial asset held by securities
intermediary.
(a) To the extent necessary for a securities intermediary to satisfy
all security entitlements with respect to a particular financial asset, all
interests in that financial asset held by the securities intermediary are held
by the securities intermediary for the entitlement holders, are not property
of the securities intermediary, and are not subject to claims of creditors of
the securities intermediary, except as otherwise provided in Section 8-511.
(b) An entitlement holder's property interest with respect to a
particular financial asset under subsection (a) is a pro rata property interest
in all interests in that financial asset held by the securities intermediary,
without regard to the time the entitlement holder acquired the security
entitlement or the time the securities intermediary acquired the interest in
that financial asset.
(c) An entitlement holder's property interest with respect to a
particular financial asset under subsection (a) may be enforced against the
securities intermediary only by exercise of the entitlement holder's rights
under Sections 8-505 through 8-508.
(d) An entitlement holder's property interest with respect to a
particular financial asset under subsection (a) may be enforced against a
purchaser of the financial asset or interest therein only if:
(e) An action based on the entitlement holder's property interest
with respect to a particular financial asset under subsection (a), whether
framed in conversion, replevin, constructive trust, equitable lien, or other
theory, may not be asserted against any purchaser of a financial asset or
interest therein who gives value, obtains control, and does not act in
collusion with the securities intermediary in violating the securities
intermediary's obligations under Section 8-504.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-504)
Sec. 8-504.

Duty of securities intermediary to
maintain financial asset.
(a) A securities intermediary shall promptly obtain and thereafter
maintain a financial asset in a quantity corresponding to the aggregate of all
security entitlements it has established in favor of its entitlement holders
with respect to that financial asset. The securities intermediary may
maintain those financial assets directly or through one or more other
securities intermediaries.
(b) Except to the extent otherwise agreed by its entitlement holder,
a securities intermediary may not grant any security interests in a financial
asset it is obligated to maintain pursuant to subsection (a).
(c) A securities intermediary satisfies the duty in subsection (a) if:
(d) This Section does not apply to a clearing corporation that is
itself the obligor of an option or similar obligation to which its entitlement
holders have security entitlements.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-505)
Sec. 8-505.

Duty of securities intermediary with
respect to payments and distributions.
(a) A securities intermediary shall take action to obtain a payment
or distribution made by the issuer of a financial asset. A securities
intermediary satisfies the duty if:
(b) A securities intermediary is obligated to its entitlement holder
for a payment or distribution made by the issuer of a financial asset if the
payment or distribution is received by the securities intermediary.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-506)
Sec. 8-506.

Duty of securities intermediary to exercise rights as
directed by entitlement holder. 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:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-507)
Sec. 8-507.

Duty of securities intermediary to
comply with entitlement order.
(a) A securities intermediary shall comply with an entitlement order
if the entitlement order is originated by the appropriate person, the
securities intermediary has had reasonable opportunity to assure itself that
the entitlement order is genuine and authorized, and the securities
intermediary has had reasonable opportunity to comply with the entitlement
order. A securities intermediary satisfies the duty if:
(b) If a securities intermediary transfers a financial asset pursuant
to an ineffective entitlement order, the securities intermediary shall
reestablish a security entitlement in favor of the person entitled to it, and
pay or credit any payments or distributions that the person did not receive
as a result of the wrongful transfer. If the securities intermediary does not
reestablish a security entitlement, the securities intermediary is liable to
the entitlement holder for damages.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-508)
Sec. 8-508.

Duty of securities intermediary to
change entitlement holder's position to other form of
security holding. A securities intermediary shall act at the direction
of an entitlement holder to change a security entitlement into another
available form of holding for which the entitlement holder is eligible, or to
cause the financial asset to be transferred to a securities account of the
entitlement holder with another securities intermediary. A securities
intermediary satisfies the duty if:
(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-509)
Sec. 8-509.

Specification of duties of securities
intermediary by other statute or regulation; manner
of performance of duties of securities intermediary
and exercise of rights of entitlement holder.
(a) If the substance of a duty imposed upon a securities
intermediary by Sections 8-504 through 8-508 is the subject of other statute,
regulation, or rule, compliance with that statute, regulation, or rule
satisfies the duty.
(b) To the extent that specific standards for the performance of the
duties of a securities intermediary or the exercise of the rights of an
entitlement holder are not specified by other statute, regulation, or rule or
by agreement between the securities intermediary and entitlement holder,
the securities intermediary shall perform its duties and the entitlement
holder shall exercise its rights in a commercially reasonable manner.
(c) The obligation of a securities intermediary to perform the duties
imposed by Sections 8-504 through 8-508 is subject to:
(d) Sections 8-504 through 8-508 do not require a securities
intermediary to take any action that is prohibited by other statute,
regulation, or rule.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-510)
Sec. 8-510.

Rights of purchaser of security
entitlement from entitlement holder.
(a) In a case not covered by the priority rules in Article 9 or the
rules stated in subsection (c), an
action based on an adverse claim to a financial asset or
security entitlement, whether framed in conversion, replevin, constructive
trust, equitable lien, or other theory, may not be asserted against a person
who purchases a security entitlement, or an interest therein, from an
entitlement holder if the purchaser gives value, does not have notice of the
adverse claim, and obtains control.
(b) If an adverse claim could not have been asserted against an
entitlement holder under Section 8-502, the adverse claim cannot be asserted
against a person who purchases a security entitlement, or an interest therein,
from the entitlement holder.
(c) In a case not covered by the priority rules in Article 9, a
purchaser for value of a security entitlement, or an interest therein, who
obtains control has priority over a purchaser of a security entitlement, or an
interest therein, who does not obtain control. Except as otherwise provided
in subsection (d), purchasers who have control rank
according to priority in time of:
(d) A securities intermediary as purchaser
has priority over a conflicting purchaser who has control unless otherwise
agreed by the securities intermediary.

(Source: P.A. 91-893, eff. 7-1-01.)
 
(810 ILCS 5/8-511)
Sec. 8-511.

Priority
among security interests and
entitlement holders.
(a) Except as otherwise provided in subsections (b) and (c), if a
securities intermediary does not have sufficient interests in a particular
financial asset to satisfy both its obligations to entitlement holders who have
security entitlements to that financial asset and its obligation to a creditor
of the securities intermediary who has a security interest in that financial
asset, the claims of entitlement holders, other than the creditor, have
priority over the claim of the creditor.
(b) A claim of a creditor of a securities intermediary who has a
security interest in a financial asset held by a securities intermediary has
priority over claims of the securities intermediary's entitlement holders who
have security entitlements with respect to that financial asset if the creditor
has control over the financial asset.
(c) If a clearing corporation does not have sufficient financial assets
to satisfy both its obligations to entitlement holders who have security
entitlements with respect to a financial asset and its obligation to a creditor
of the clearing corporation who has a security interest in that financial
asset, the claim of the creditor has priority over the claims of entitlement
holders.

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/Art. 8 Pt. 6 heading)

 
(810 ILCS 5/8-601)
Sec. 8-601.
Effective date.
(Blank).

(Source: P.A. 89-364, eff. 1-1-96.)
 
(810 ILCS 5/8-602)
Sec. 8-602.
Repeals.
(See Section 60 of Public Act 89-364 for repeal of
certain Sections of Article 8 of the Uniform Commercial Code.)

(Source: P.A. 89-364, eff. 1-1-96; 89-626, eff. 8-9-96.)
 
(810 ILCS 5/8-603)
Sec. 8-603.
Savings clause.
(a) This amendatory Act of 1995 does not affect an action or proceeding
commenced
before this amendatory Act of 1995 takes effect.
(b) If a security interest in a security is perfected at the date this
amendatory Act of 1995 takes effect, and the action by which the security
interest was
perfected would suffice to perfect a security interest under this amendatory
Act of 1995, no
further action is required to continue perfection. If a security interest in a
security is perfected at the date this amendatory Act of 1995 takes effect but
the action by
which the security interest was perfected would not suffice to perfect a
security interest under this amendatory Act of 1995, the security interest
remains perfected
for a period of 4 months after the effective date and continues perfected
thereafter if appropriate action to perfect under this amendatory Act of 1995
is taken within
that period. If
a security interest is perfected at the date this amendatory Act of 1995 takes
effect and the
security interest can be perfected by filing under this amendatory Act of 1995,
a financing
statement signed by the secured party instead of the debtor may be filed
within that period to continue perfection or thereafter to perfect.

(Source: P.A. 89-364, eff. 1-1-96.)

Structure Illinois Compiled Statutes