84-8-504. 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:
(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 exercises due care in accordance with reasonable commercial standards to obtain and maintain the financial asset.
(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.
History: L. 1996, ch. 202, ยง 71; July 1.
Structure Kansas Statutes
Chapter 84 - Uniform Commercial Code
Article 8 - Investment Securities
84-8-104 Acquisition of security or financial asset or interest therein.
84-8-105 Notice of adverse claim.
84-8-107 Whether indorsement, instruction or entitlement order is effective.
84-8-108 Warranties in direct holding.
84-8-109 Warranties in indirect holding.
84-8-110 Applicability; choice of law.
84-8-111 Clearing corporation rules.
84-8-112 Creditor's legal process.
84-8-113 Statute of frauds inapplicable.
84-8-114 Evidentiary rules concerning certificated securities.
84-8-115 Securities intermediary and others not liable to adverse claimant.
84-8-116 Securities intermediary as purchaser for value.
84-8-202 Issuer's responsibility and defenses; notice of defect or defense.
84-8-203 Staleness as notice of defect or defense.
84-8-204 Effect of issuer's restriction on transfer.
84-8-205 Effect of unauthorized signature on security certificate.
84-8-206 Completion or alteration of security certificate.
84-8-207 Rights and duties of issuer with respect to registered owners.
84-8-208 Effect of signature of authenticating trustee, registrar or transfer agent.
84-8-306 Effect of guaranteeing signature, indorsement or instruction.
84-8-307 Purchaser's right to requisites for registration of transfer.
84-8-401 Duty of issuer to register transfer.
84-8-402 Assurance that indorsement or instruction is effective.
84-8-403 Demand that issuer not register transfer.
84-8-404 Wrongful registration.
84-8-405 Replacement of lost, destroyed or wrongfully taken security certificate.
84-8-406 Obligation to notify issuer of lost, destroyed or wrongfully taken security certificate.
84-8-407 Authenticating trustee, transfer agent and registrar.
84-8-501 Securities account; acquisition of security entitlement from securities intermediary.
84-8-502 Assertion of adverse claim against entitlement holder.
84-8-503 Property interest of entitlement holder in financial asset held by securities intermediary.
84-8-504 Duty of securities intermediary to maintain financial asset.
84-8-505 Duty of securities intermediary with respect to payments and distributions.
84-8-506 Duty of securities intermediary to exercise rights as directed by entitlement holder.
84-8-507 Duty of securities intermediary to comply with entitlement order.
84-8-510 Rights of purchaser of security entitlement from entitlement holder.
84-8-511 Priority among security interests and entitlement holders.