Arizona Laws 47-8501. 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.
Terms Used In Arizona Laws 47-8501
- Entitlement: A Federal program or provision of law that requires payments to any person or unit of government that meets the eligibility criteria established by law. Entitlements constitute a binding obligation on the part of the Federal Government, and eligible recipients have legal recourse if the obligation is not fulfilled. Social Security and veterans' compensation and pensions are examples of entitlement programs.
- Financial asset: except as otherwise provided in section 47-8103, means:
(a) A security;
(b) 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
(c) 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 chapter. See Arizona Laws 47-8102
- Person: includes a corporation, company, partnership, firm, association or society, as well as a natural person. See Arizona Laws 1-215
- Securities intermediary: means :
(a) A clearing corporation; or
(b) 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. See Arizona Laws 47-8102
- Security: except as otherwise provided in section 47-8103, 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:
(a) 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;
(b) 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
(c) Which:
(i) Is, or is of a type, dealt in or traded on securities exchanges or securities markets; or
(ii) Is a medium for investment and by its terms expressly provides that it is a security governed by this chapter. See Arizona Laws 47-8102
- Security entitlement: means the rights and property interest of an entitlement holder with respect to a financial asset specified in article 5 of this chapter. See Arizona Laws 47-8102
B. Except as otherwise provided in subsections D and E, a person acquires a security entitlement if a securities intermediary:
1. Indicates by book entry that a financial asset has been credited to the person’s securities account;
2. Receives a financial asset from the person or acquires a financial asset for the person and, in either case, accepts it for credit to the person’s securities account; or
3. Becomes obligated under another law, regulation or rule to credit a financial asset to the person’s securities account.
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.