Okla. Stat. tit. 12A § 8-402

Current through Laws 2024, c. 453.

Section 8-402 - Assurance that Indorsement or Instruction Is Effective. 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:

(1) in all cases, a guaranty of the signature of the person making an indorsement or originating an instruction including, in the case of an instruction, reasonable assurance of identity;

(2) if the indorsement is made or the instruction is originated by an agent, appropriate assurance of actual authority to sign;

(3) if the indorsement is made or the instruction is originated by a fiduciary pursuant to paragraph (4) or (5) of subsection (a) of Section 8-107 of this title, appropriate evidence of appointment or incumbency;

(4) if there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; and

(5) if the indorsement is made or the instruction is originated by a person not covered by another provision of this subsection, assurance appropriate to the case corresponding as nearly as may be to the provisions of this subsection.

(b) An issuer may elect to require reasonable assurance beyond that specified in this section.

(c) In this section:

(1) "Guaranty of the signature" means a guaranty signed by or on behalf of a person reasonably believed by the issuer to be responsible. An issuer may adopt standards with respect to responsibility if they are not manifestly unreasonable.

(2) "Appropriate evidence of appointment or incumbency" means:

(i) in the case of a fiduciary appointed or qualified by a court, a certificate issued by or under the direction or supervision of the court or an officer thereof and dated within sixty (60) days before the date of presentation for transfer; or

(ii) in any other case, a copy of a document showing the appointment or a certificate issued by or on behalf of a person reasonably believed by an issuer to be responsible or, in the absence of that document or certificate, other evidence the issuer reasonably considers appropriate.

Okla. Stat. tit. 12A, § 8-402

Added by Laws 1961, p. 159, § 8-402. Amended by Laws 1984, HB 1800, c. 76, § 40, eff. 11/1/1984; Amended by Laws 1995, SB 522, c. 242, § 35, eff. 2/1/1996.

Oklahoma Code Comment

As a condition of performing a requested registration of transfer, Article 8 gives issuers the right to obtain assurances that indorsements of certificated securities and signatures on instructions are genuine and effective. These rights fall into two main categories: (1) the right to demand signature guarantees, and (2) the right to establish the authority of third-party signatories.

The effects of signature guarantees which the issuer may demand under this Section are found in Section 8-306 .

Pre-revision law also gave the issuer the right to demand evidence of the authority of an agent, fiduciary or other person to indorse a certificate on behalf of a principal. This right is preserved in sub sections 8-402(a)(2) through (5), and extends to agents' executions of instructions.

Two notable changes appear in Section 8-402 . First, the Section deletes the reference to taxpayer identification contained in pre-revision subsection (1)(a). Second, pre-revision subsection (4) has been deleted in an effort to discourage issuers from requiring excessive documentation to compensate for the issuer's being put on notice of all matters contained in the other unnecessary documentation. This deletion is consistent with the Article's intent to avoid a "paper upon paper dilemma," and thus relieves issuers of liability for transfers merely on grounds of notice of apparent adverse claims. But see UCC § 8-402(b)

Prior Statutory Provisions:

18 Okla. Stat. § 1.115 (1947).

See also 18 Okla. Stat. §§ 1.118-1.120 (1951).

Pre-revision UCC § 8-402.