408.402(1)(1) The issuer may require the following assurance that each necessary endorsement (
s. 408.308) is genuine and effective:
408.402(1)(a)
(a) In all cases, a guarantee of the signature (
s. 408.312 (1) or
(2)) of the person endorsing a certificated security or originating an instruction including, in the case of an instruction, a warranty of the taxpayer identification number or, in the absence thereof, other reasonable assurance of identity;
408.402(1)(b)
(b) If the endorsement is made or the instruction is originated by an agent, appropriate assurance of authority to sign;
408.402(1)(c)
(c) If the endorsement is made or the instruction is originated by a fiduciary, appropriate evidence of appointment or incumbency;
408.402(1)(d)
(d) If there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; and
408.402(1)(e)
(e) If the endorsement is made or the instruction is originated by a person not covered by any of the foregoing, assurance appropriate to the case corresponding as nearly as may be to the foregoing.
408.402(2)
(2) A "guarantee of the signature" in
sub. (1) means a guarantee signed by or on behalf of a person reasonably believed by the issuer to be responsible. The issuer may adopt standards with respect to responsibility if they are not manifestly unreasonable.
408.402(3)
(3) "Appropriate evidence of appointment or incumbency" in
sub. (1) means:
408.402(3)(a)
(a) In the case of a fiduciary appointed or qualified by a court, a certificate issued by or under the direction or supervision of that court or an officer thereof and dated within 60 days before the date of presentation for transfer, pledge or release; or
408.402(3)(b)
(b) In any other case, a copy of a document showing the appointment or a certificate issued by or on behalf of a person reasonably believed by the issuer to be responsible or, in the absence of that document or certificate, other evidence reasonably deemed by the issuer to be appropriate. The issuer may adopt standards with respect to the evidence if they are not manifestly unreasonable. The issuer is not charged with notice of the contents of any document obtained under this paragraph except to the extent that the contents relate directly to the appointment or incumbency.
408.402(4)
(4) The issuer may elect to require reasonable assurance beyond that specified in this section, but if it does so and for a purpose other than that specified in
sub. (3) (b), both requires and obtains a copy of a will, trust, indenture, articles of partnership, bylaws, or other controlling instrument, it is charged with notice of all matters contained therein affecting the transfer, pledge or release.
408.402 History
History: 1985 a. 237;
1993 a. 490.
408.403
408.403
Issuer's duty as to adverse claims. 408.403(1)
(1) An issuer to whom a certificated security is presented for registration shall inquire into adverse claims if:
408.403(1)(a)
(a) A written notification of an adverse claim is received at a time and in a manner affording the issuer a reasonable opportunity to act on it prior to the issuance of a new, reissued or reregistered certificated security, and the notification identifies the claimant, the registered owner and the issue of which the security is a part, and provides an address for communications directed to the claimant; or
408.403(1)(b)
(b) The issuer is charged with notice of an adverse claim from a controlling instrument it has elected to require under
s. 408.402 (4).
408.403(2)
(2) The issuer may discharge any duty of inquiry by any reasonable means, including notifying an adverse claimant by registered or certified mail at the address furnished by the adverse claimant or if there is no such address at the adverse claimant's residence or regular place of business that the security has been presented for registration of transfer by a named person, and that the transfer will be registered unless within 30 days from the date of mailing the notification, either:
408.403(2)(a)
(a) An appropriate restraining order, injunction or other process issues from a court of competent jurisdiction; or
408.403(2)(b)
(b) There is filed with the issuer an indemnity bond sufficient in the issuer's judgment to protect the issuer and any transfer agent, registrar or other agent of the issuer involved from any loss it or they may suffer by complying with the adverse claim.
408.403(3)
(3) Unless an issuer is charged with notice of an adverse claim from a controlling instrument which it has elected to require under
s. 408.402 (4) or receives notification of an adverse claim under
sub. (1), if a certificated security presented for registration is endorsed by the appropriate person or persons the issuer is under no duty to inquire into adverse claims. In particular:
408.403(3)(a)
(a) An issuer registering a certificated security in the name of a person who is a fiduciary or who is described as a fiduciary is not bound to inquire into the existence, extent, or correct description of the fiduciary relationship and thereafter the issuer may assume without inquiry that the newly registered owner continues to be the fiduciary until the issuer receives written notice that the fiduciary is no longer acting as such with respect to the particular security;
408.403(3)(b)
(b) An issuer registering transfer on an indorsement by a fiduciary is not bound to inquire whether the transfer is made in compliance with a controlling instrument or with the law of the state having jurisdiction of the fiduciary relationship, including any law requiring the fiduciary to obtain court approval of the transfer;
408.403(3)(c)
(c) The issuer is not charged with notice of the contents of any court record or file or other recorded or unrecorded document even though the document is in its possession and even though the transfer is made on the indorsement of a fiduciary to the fiduciary himself or herself or to his or her nominee; and
408.403(3)(d)
(d) An issuer registering a transfer of a security upon an indorsement by a corporation, either individually or as fiduciary in whose name the security is registered, is not bound to inquire whether the indorsement is within the authority of the indorsing officer, or to obtain any corporate resolution or supporting paper, and may assume without inquiry that the indorsement is within the authority of the indorsing officer or officers, that each person who executes the indorsement is an incumbent of the office in which capacity he or she purports to sign and that if more than one officer is required to execute the indorsement, all who must execute it have done so.
408.403(4)
(4) An issuer is under no duty as to adverse claims with respect to an uncertificated security except:
408.403(4)(a)
(a) Claims embodied in a restraining order, injunction or other legal process served upon the issuer if the process was served at a time and in a manner affording the issuer a reasonable opportunity to act on it in accordance with the requirements of
sub. (5).
408.403(4)(b)
(b) Claims of which the issuer has received a written notification from the registered owner or the registered pledgee if the notification was received at a time and in a manner affording the issuer a reasonable opportunity to act on it in accordance with the requirements of
sub. (5).
408.403(4)(c)
(c) Claims, including restrictions on transfer not imposed by the issuer, to which the registration of transfer to the present registered owner was subject and were so noted in the initial transaction statement sent to him or her.
408.403(4)(d)
(d) Claims as to which an issuer is charged with notice from a controlling instrument it has elected to require under
s. 408.402 (4).
408.403(5)
(5) If the issuer of an uncertificated security is under a duty as to an adverse claim, he or she discharges that duty by:
408.403(5)(b)
(b) Refusing to register the transfer or pledge of the security unless the nature of the claim does not preclude transfer or pledge subject thereto.
408.403(6)
(6) If the transfer or pledge of the security is registered subject to an adverse claim, a notation of the claim must be included in the initial transaction statement and all subsequent statements sent to the transferee and pledgee under
s. 408.408.
408.403(7)
(7) Notwithstanding
subs. (4) and
(5), if an uncertificated security was subject to a registered pledge at the time the issuer first came under a duty as to a particular adverse claim, the issuer has no duty as to that claim if transfer of the security is requested by the registered pledgee or an appropriate person acting for the registered pledgee unless:
408.403(7)(a)
(a) The claim was embodied in legal process which expressly provides otherwise.
408.403(7)(b)
(b) The claim was asserted in a written notification from the registered pledgee.
408.403(7)(c)
(c) The claim was one as to which the issuer was charged with notice from a controlling instrument it required under
s. 408.402 (4) in connection with the pledgee's request for transfer.
408.403(7)(d)
(d) The transfer requested is to the registered owner.
408.404
408.404
Liability and nonliability for registration. 408.404(1)(1) Except as provided in any law relating to the collection of taxes, the issuer is not liable to the owner, pledgee or any other person suffering loss as a result of the registration of a transfer, pledge or release of a security if:
408.404(1)(a)
(a) There was on or with a certificated security the necessary endorsement or the issuer had received an instruction originated by an appropriate person (
s. 408.308); and
408.404(1)(b)
(b) The issuer had no duty as to adverse claims or has discharged the duty (
s. 408.403).
408.404(2)
(2) If an issuer has registered a transfer of a certificated security to a person not entitled to it, the issuer on demand shall deliver a like security to the true owner unless:
408.404(2)(c)
(c) The delivery would result in overissue, in which case the issuer's liability is governed by
s. 408.104.
408.404(3)
(3) If an issuer has improperly registered a transfer, pledge or release of an uncertificated security, the issuer on demand from the injured party shall restore the records as to the injured party to the condition that would have obtained if the improper registration had not been made unless:
408.404(3)(b)
(b) The registration would result in overissue, in which case the issuer's liability is governed by
s. 408.104.
408.404 History
History: 1985 a. 237.
408.405
408.405
Lost, destroyed and stolen certificated securities. 408.405(1)(1) If a certificated security has been lost, apparently destroyed or wrongfully taken, and the owner fails to notify the issuer of that fact within a reasonable time after he or she has notice of it and the issuer registers a transfer of the security before receiving notification, the owner is precluded from asserting against the issuer any claim for registering the transfer under
s. 408.404 or any claim to a new security under this section.
408.405(2)
(2) If the owner of a certificated security claims that the security has been lost, destroyed or wrongfully taken, the issuer shall issue a new certificated security or, at the option of the issuer, an equivalent uncertificated security in place of the original security if the owner:
408.405(2)(a)
(a) So requests before the issuer has notice that the security has been acquired by a bona fide purchaser;
408.405(2)(b)
(b) Files with the issuer a sufficient indemnity bond; and
408.405(2)(c)
(c) Satisfies any other reasonable requirements imposed by the issuer.
408.405(3)
(3) If, after the issue of a new certificated or uncertificated security, a bona fide purchaser of the original certificated security presents it for registration of transfer, the issuer shall register the transfer unless registration would result in overissue, in which event the issuer's liability is governed by
s. 408.104. In addition to any rights on the indemnity bond, the issuer may recover the new certificated security from the person to whom it was issued or any person taking under him or her except a bona fide purchaser or may cancel the uncertificated security unless a bona fide purchaser or any person taking under a bona fide purchaser is then the registered owner or registered pledgee thereof.
408.405 History
History: 1985 a. 237.
408.406
408.406
Duty of authenticating trustee, transfer agent or registrar. 408.406(1)(1) If a person acts as authenticating trustee, transfer agent, registrar or other agent for an issuer in the registration of transfers of its certificated securities or in the registration of transfers, pledges and releases of its uncertificated securities, in the issue of new securities or in the cancellation of surrendered securities:
408.406(1)(a)
(a) That person is under a duty to the issuer to exercise good faith and due diligence in performing that person's functions; and
408.406(1)(b)
(b) With regard to the particular functions he or she performs, he or she has the same obligation to the holder or owner of a certificated security or to the owner or pledgee of an uncertificated security and has the same rights and privileges as the issuer has in regard to those functions.
408.406(2)
(2) Notice to an authenticating trustee, transfer agent, registrar or other agent is notice to the issuer with respect to the functions performed by the agent.
408.406 History
History: 1985 a. 237;
1991 a. 316.
408.407
408.407
Exchangeability of securities. 408.407(1)
(1) No issuer is subject to the requirements of this section unless it regularly maintains a system for issuing the class of securities involved under which both certificated and uncertificated securities are regularly issued to the category of owners, which includes the person in whose name the new security is to be registered.
408.407(2)
(2) Upon surrender of a certificated security with all necessary endorsements and presentation of a written request by the person surrendering the security, the issuer, if he or she has no duty as to adverse claims or has discharged the duty (
s. 408.403), shall issue to the person or a person designated by him or her an equivalent uncertificated security subject to all liens, restrictions and claims that were noted on the certificated security.
408.407(3)
(3) Upon receipt of a transfer instruction originated by an appropriate person who so requests, the issuer of an uncertificated security shall cancel the uncertificated security and issue an equivalent certificated security on which must be noted conspicuously any liens and restrictions of the issuer and any adverse claims, as to which the issuer has a duty under
s. 408.403 (4), to which the uncertificated security was subject. The certificated security shall be registered in the name of and delivered to:
408.407(3)(a)
(a) The registered owner if the uncertificated security was not subject to a registered pledge; or
408.407(3)(b)
(b) The registered pledgee if the uncertificated security was subject to a registered pledge.
408.407 History
History: 1985 a. 237.
408.408
408.408
Statements of uncertificated securities. 408.408(1)(1) Within 2 business days after the transfer of an uncertificated security has been registered, the issuer shall send to the new registered owner and, if the security has been transferred subject to a registered pledge, to the registered pledgee a written statement containing all of the following:
408.408(1)(a)
(a) A description of the issue of which the uncertificated security is a part.
408.408(1)(c)
(c) The name and address and any taxpayer identification number of the newly registered owner and, if the security has been transferred subject to a registered pledge, the name and address and any taxpayer identification number of the registered pledgee.
408.408(1)(d)
(d) A notation of any liens and restrictions of the issuer and any adverse claims, as to which the issuer has a duty under
s. 408.403 (4), to which the uncertificated security is or may be subject at the time of registration or a statement that there are none of those liens, restrictions or adverse claims.
408.408(2)
(2) Within 2 business days after the pledge of an uncertificated security has been registered, the issuer shall send to the registered owner and the registered pledgee a written statement containing all of the following:
408.408(2)(a)
(a) A description of the issue of which the uncertificated security is a part.
408.408(2)(c)
(c) The name and address and any taxpayer identification number of the registered owner and the registered pledgee.
408.408(2)(d)
(d) A notation of any liens and restrictions of the issuer and any adverse claims, as to which the issuer has a duty under
s. 408.403 (4), to which the uncertificated security is or may be subject at the time of registration or a statement that there are none of those liens, restrictions or adverse claims.
408.408(3)
(3) Within 2 business days after the release from pledge of an uncertificated security has been registered, the issuer shall send to the registered owner and the pledgee whose interest was released a written statement containing all of the following:
408.408(3)(a)
(a) A description of the issue of which the uncertificated security is a part.
408.408(3)(b)
(b) The number of shares or units released from pledge.
408.408(3)(c)
(c) The name and address and any taxpayer identification number of the registered owner and the pledgee whose interest was released.
