Printable Format84-8-401. Duty of issuer to register transfer. (a) If a certificated security in registered form is presented to an issuer with a request to register transfer or an instruction is presented to an issuer with a request to register transfer of an uncertificated security, the issuer shall register the transfer as requested if:
(1) Under the terms of the security the person seeking registration of transfer is eligible to have the security registered in its name;
(2) the indorsement or instruction is made by the appropriate person or by an agent who has actual authority to act on behalf of the appropriate person;
(3) reasonable assurance is given that the indorsement or instruction is genuine and authorized (K.S.A. 84-8-402);
(4) any applicable law relating to the collection of taxes has been complied with;
(5) the transfer does not violate any restriction on transfer imposed by the issuer in accordance with K.S.A. 84-8-204;
(6) a demand that the issuer not register transfer has not become effective under K.S.A. 84-8-403, or the issuer has complied with subsection (b) of K.S.A. 84-8-403 but no legal process or indemnity bond is obtained as provided in subsection (d) of K.S.A. 84-8-403; and
(7) the transfer is in fact rightful or is to a protected purchaser.
(b) If an issuer is under a duty to register a transfer of a security, the issuer is liable to a person presenting a certificated security or an instruction for registration or to the person's principal for loss resulting from unreasonable delay in registration or failure or refusal to register the transfer.
History: L. 1996, ch. 202, § 61; July 1.
KANSAS COMMENT, 1996
This section is a modification of the former 84-8-401. It is identical to the Official Text.
Subsection (a) states the issuer's duty to register the transfer of a security. The issuer must register a transfer if the preconditions listed in paragraphs (1) through (7) are met. These preconditions are not mandatory, however, and an issuer may register the transfer even if they are not met, but no issuer can be forced to register the transfer absent compliance with these preconditions. The numbered paragraphs have been reordered and modified, and paragraphs (1) and (5) are substantially new. The seven preconditions relate to possible restrictions on the security (1), the validity of the registration request (2) and (3), collection of taxes (4), the issuer's restrictions (5), demands that the issuer not register (6) and the rights of those with adverse claims to the security (7).
Subsection (b) makes the issuer liable for damages for improper refusal to register a transfer of a security. The parallel liability of a transfer agent is stated in 84-8-407.
Revisor's Note:
Former section 84-8-401 was repealed by L. 1996, ch. 202, § 91 and the number reassigned to the current text.