1. In this chapter:
a. "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.
b. "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 endorsement.
c. "Broker" means a person defined as a broker or dealer under the federal
securities laws, but without excluding a bank acting in that capacity.
d. "Certificated security" means a security that is represented by a certificate.
e. "Clearing corporation" means:
(1)A person registered as a "clearing agency" under the federal securities laws;
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1. In this chapter:
a. "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.
b. "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 endorsement.
c. "Broker" means a person defined as a broker or dealer under the federal
securities laws, but without excluding a bank acting in that capacity.
d. "Certificated security" means a security that is represented by a certificate.
e. "Clearing corporation" means:
(1) A person registered as a "clearing agency" under the federal securities laws;
(2) A federal reserve bank; or
(3) 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.
f. "Communicate" means to:
(1) Send a signed record; or
(2) Transmit information by any mechanism agreed upon by the persons
transmitting and receiving the information.
g. "Endorsement" 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.
h. "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 subdivision b
or c of subsection 2 of section 41-08-41, that person is the entitlement holder.
i. "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.
j. "Financial asset", except as otherwise provided in section 41-08-03, means:
(1) A security;
(2) 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
(3) 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.
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.
k. "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.
l. "Registered form", as applied to a certificated security, means a form in which:
(1) The security certificate specifies a person entitled to the security; and
(2) 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.
m. "Securities intermediary" means:
(1) A clearing corporation; or
(2) 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.
n. "Security", except as otherwise provided in section 41-08-03, 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) 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;
(2) 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
(3) Which:
(a) Is, or is of a type, dealt in or traded on securities exchanges or
securities markets; or
(b) Is a medium for investment and by its terms expressly provides that it
is a security governed by this chapter.
o. "Security certificate" means a certificate representing a security.
p. "Security entitlement" means the rights and property interest of an entitlement
holder with respect to a financial asset specified in sections 41-08-41 through