Okla. Stat. tit. 12A § 8-506

Current through Laws 2024, c. 453.

Section 8-506 - Duty of Securities Intermediary to Exercise Rights as Directed by Entitlement Holder

A securities intermediary shall exercise rights with respect to a financial asset if directed to do so by an entitlement holder. A securities intermediary satisfies the duty if:

(1) the securities intermediary acts with respect to the duty as agreed upon by the entitlement holder and the securities intermediary; or

(2) in the absence of agreement, the securities intermediary either places the entitlement holder in a position to exercise the rights directly or exercises due care in accordance with reasonable commercial standards to follow the direction of the entitlement holder.

Okla. Stat. tit. 12A, § 8-506

Added by Laws 1995, SB 522, c. 242, § 46, eff. 2/1/1996.

Oklahoma Code Comment

Although by virtue of the structure of the indirect holding system, the securities intermediary is the party who has the power to exercise the corporate and other rights that come from holding a security, the intermediary must exercise those powers as the representative of the entitlement holder rather than at its own discretion. The holder may, of course, confer discretionary authority upon the intermediary by agreement. As is the case with other duties under Sections 8-504 through 8-508, the intermediary may satisfy its duty under this Section by acting according to any agreement made in good faith with the entitlement holder or by exercising due care. Additionally, the intermediary may place the holder in a position to exercise the rights directly. Under sub section 8-509(a), compliance with applicable regulatory requirements constitutes compliance with Section 8-506 .

Prior Statutory Provisions:

None.