KRS 355.8-106: Control.

(1) A purchaser has "control" of a certificated security in bearer form if the certificated

security is delivered to the purchaser.

(2) A purchaser has "control" of a certificated security in registered form if the

certificated security is delivered to the purchaser, and:

(a) The certificate is indorsed to the purchaser or in blank by an effective

indorsement; or

(b) The certificate is registered in the name of the purchaser, upon original issue

or registration of transfer by the issuer.

(3) A purchaser has "control" of an uncertificated security if:

(a) The uncertificated security is delivered to the purchaser; or

(b) The issuer has agreed that it will comply with instructions originated by the

purchaser without further consent by the registered owner.

(4) A purchaser has "control" of a security entitlement if:

(a) The purchaser becomes the entitlement holder;

(b) The securities intermediary has agreed that it will comply with entitlement

orders originated by the purchaser without further consent by the entitlem ent

holder; or

(c) Another person, other than the transferor to the purchaser of an interest in the

security entitlement:

1. Has control of the se curity entitlement and acknowledges that it has

control on behalf of the purchaser; or

2. Obtains control of the security entitlement after having acknowledged

that it will obtain control of the security entitlement on behalf of the

purchaser.

(5) If an in terest in a security entitlement is granted by the entitlement holder to the

entitlement holder's own securities intermediary, the securities intermediary has

control.

(6) A purchaser who has satisfied the requirements of subsection (3) or (4) of this

section has control, even if the registered owner in the case of subsection (3) of this

section or the entitlement holder in the case of subsection (4) of this section retains

the right to make substitutions for the uncertificated security or security entitlement,

to originate instructions or entitlement orders to the issuer or securities

intermediary, or otherwise to deal with the uncertificated security or security

entitlement.

(7) An issuer or a securities intermediary may not enter into an agreement of the kind

described in subsection (3)(b) or (4)(b) of this section without the consent of the

registered owner or entitlement holder, but an issuer or a securities intermediary is

not required to enter into such an agreement even though the registered owner or

entitlement holder so directs. An issuer or securities intermediary that has entered

into such an agreement is not required to confirm the existence of the agreement to

another party unless requested to do so by the registered owner or entitlement

holder.

(8) A person that has control under this section is not required to acknowledge that it

has control on behalf of a purchaser.

(9) If a person acknowledges that it has or will obtain control on behalf of a purchaser,

unless the person otherwise agrees or la w other than this article or Article 9 of this

chapter otherwise provides, the person does not own any duty to the purchaser and

is not required to confirm the acknowledgment to any other person.