70A-8-102 - Rules for determining whether certain obligations and interests are securities or financial assets.
70A-8-102. Rules for determining whether certain obligations and interests aresecurities or financial assets.
(1) A share or similar equity interest issued by a corporation, business trust, joint stockcompany, or similar entity is a security.
(2) An "investment company security" is a security. "Investment company security"means a share or similar equity interest issued by an entity that is registered as an investmentcompany under the federal investment company laws, an interest in a unit investment trust that isso registered, or a face-amount certificate issued by a face-amount certificate company that is soregistered. Investment company security does not include an insurance policy or endowmentpolicy or annuity contract issued by an insurance company.
(3) An interest in a partnership or limited liability company is not a security unless it isdealt in or traded on securities exchanges or in securities markets, its terms expressly provide thatit is a security governed by this chapter, or it is an investment company security. However, aninterest in a partnership or limited liability company is a financial asset if it is held in a securitiesaccount.
(4) A writing that is a security certificate is governed by this chapter and not by Chapter3, Uniform Commercial Code - Negotiable Instruments, even though it also meets therequirements of that chapter. However, a negotiable instrument governed by Chapter 3 is afinancial asset if it is held in a securities account.
(5) An option or similar obligation issued by a clearing corporation to its participants isnot a security, but is a financial asset.
(6) A commodity contract, as defined in Subsection 70A-9a-102(15), is not a security ora financial asset.
(7) A document of title is not a financial asset unless Subsection 70A-8-101(1)(i)(i)(C)applies.
Amended by Chapter 42, 2006 General Session