TITLE 11 COMMERCIAL CODE

Section 8. Investment Securities, 11-8-101 through 11-8-603.

ARTICLE 8 INVESTMENT SECURITIES

11-8-102. Definitions.

1. 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 terms 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:
   6. "Communicate" means to:
   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 Code Section 11-8-501, 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 Code Section 11-8-103, means:

      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. Reserved.
   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 certificated security, means a form in which:
   14. "Securities intermediary" means:
   15. "Security," except as otherwise provided in Code Section 11-8-103, 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:
       1. Is, or is of a type, dealt in or traded on securities exchanges or securities markets; or
       2. 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.
   18. "Uncertificated security" means a security that is not represented by a certificate.
2. Other definitions applying to this article and the Code sections in which they appear are:

   "Appropriate person." Code Section 11-8-107.

   "Control." Code Section 11-8-106.

   "Delivery." Code Section 11-8-301.

   "Investment company security." Code Section 11-8-103.

   "Issuer." Code Section 11-8-201.

   "Overissue." Code Section 11-8-210.

   "Protected purchaser." Code Section 11-8-303.

   "Securities account." Code Section 11-8-501.

3. In addition, Article 1 of this title contains general definitions and principles of construction and interpretation applicable throughout this article.
4. 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.

A person that is registered as a "clearing agency" under the federal securities laws;

A federal reserve bank; or

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.

Send a signed writing; or

Transmit information by any mechanism agreed upon by the persons transmitting and receiving the information.

A security;

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

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.

The security certificate specifies a person entitled to the security; and

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.

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.

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;

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

Which:

(Code 1981, §11-8-102, enacted by Ga. L. 1998, p. 1323, § 1; Ga. L. 2015, p. 996, § 3B-17/SB 65.)

The 2015 amendment, effective January 1, 2016, substituted "Reserved" for " '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" in paragraph (a)(10).