§ 41-08-10 — (8-110) Applicability - Choice of law

1. The local law of the issuer's jurisdiction, as specified in subsection 4, governs:
a. The validity of a security;
b. The rights and duties of the issuer with respect to registration of transfer;
c. The effectiveness of registration of transfer by the issuer;
d. Whether the issuer owes any duties to an adverse claimant to a security; and
e. Whether an adverse claim can be asserted against a person to whom transfer of
a certificated or uncertificated security is registered or a person who obtains
control of an uncertificated security.
2. The local law of the securities intermediary's jurisdiction, as specified in subsection 5,
governs:
a. Acquisition of a security entitlement from the securities intermediary;
b. The rights and duties of the securities intermediary and entitlement holder arising
out of a security entitlement;
c. Whether the securities intermediary owes any duties to an adverse claimant to a
security entitlement; and
d. Whether an adverse claim can be asserted against a person who acquires a
security entitlement from the securities intermediary or a person who purchases a
security entitlement or interest therein from an entitlement holder.
3. The local law of the jurisdiction in which a security certificate is located at the time of
delivery governs whether an adverse claim can be asserted against a person to whom
the security certificate is delivered.
4. "Issuer's jurisdiction" means the jurisdiction under which the issuer of the security is
organized or, if permitted by the law of that jurisdiction, the law of another jurisdiction
specified by the issuer. An issuer organized under the law of this state may specify the
law of another jurisdiction as the law governing the matters specified in subdivisions b
through e of subsection 1.
5. The following rules determine a "securities intermediary's jurisdiction" for purposes of
this section:
a. If an agreement between the securities intermediary and its entitlement holder
governing the securities account expressly provides that a particular jurisdiction is
the securities intermediary's jurisdiction for purposes of this part, this chapter, or
this title, that jurisdiction is the securities intermediary's jurisdiction.
b. If subdivision a does not apply and an agreement between the securities
intermediary and its entitlement holder governing the securities account expressly
provides that the agreement is governed by the law of a particular jurisdiction,
that jurisdiction is the securities intermediary's jurisdiction.
c. If neither subdivision a nor b applies and an agreement between the securities
intermediary and its entitlement holder governing the securities account expressly

provides that the securities account is maintained at an office in a particular
jurisdiction, that jurisdiction is the securities intermediary's jurisdiction.
d. If none of the preceding subdivisions applies, the securities intermediary's
jurisdiction is the jurisdiction in which the office identified in an account statement
as the office serving the entitlement holder's account is located.
e. If none of the preceding subdivisions applies, the securities intermediary's
jurisdiction is the jurisdiction in which the chief executive office of the securities
intermediary is located.
6. A securities intermediary's jurisdiction is not determined by the physical location of
certificates representing financial assets, or by the jurisdiction in which is organized
the issuer of the financial asset with respect to which an entitlement holder has a
security entitlement, or by the location of facilities for data processing or other
recordkeeping concerning the account.
7. The local law of the issuer's jurisdiction or the securities intermediary's jurisdiction
governs a matter or transaction specified in subsection 1 or 2 even if the matter or
transaction does not bear any relation to the jurisdiction.