KRS 355.8-107: Whether indorsement, instruction, or entitlement order is effective.

(1) "Appropriate person" means:

(a) With respect to an indorsement, the person specified by a security certificate

or by an effective special indorsement to be entitled to the security;

(b) With respect to an instruction, the registered owner of an uncertifica ted

security;

(c) With respect to an entitlement order, the entitlement holder;

(d) If the person designated in paragraph (a), (b), or (c) of this subsection is

deceased, the designated person's successor taking under other law or the

designated person's p ersonal representative acting for the estate of the

decedent; or

(e) If the person designated in paragraph (a), (b), or (c) of this subsection lacks

capacity, the designated person's guardian, conservator, or other similar

representative who has power unde r other law to transfer the security or

financial asset.

(2) An indorsement, instruction, or entitlement order is effective if:

(a) It is made by the appropriate person;

(b) It is made by a person who has power under the law of agency to transfer the

security or financial asset on behalf of the appropriate person, including, in the

case of an instruction or entitlement order, a person who has control under

KRS 355.8-106(3)(b) or (4)(b); or

(c) The appropriate person has ratified it or is otherwise precluded from asserting

its ineffectiveness.

(3) An indorsement, instruction, or entitlement order made by a representative is

effective even if:

(a) The representative has failed to comply with a controlling instrument or with

the law of the state having jurisdic tion of the representative relationship,

including any law requiring the representative to obtain court approval of the

transaction; or

(b) The representative's action in making the indorsement, instruction, or

entitlement order or using the proceeds of the transaction is otherwise a breach

of duty.

(4) If a security is registered in the name of or specially indorsed to a person described

as a representative, or if a securities account is maintained in the name of a person

described as a representative, an indorsement, instruction, or entitlement order made

by the person is effective even though the person is no longer serving in the

described capacity.

(5) Effectiveness of an indorsement, instruction, or entitlement order is determined as

of the date the indorsement, instruction, or entitlement order is made, and an

indorsement, instruction, or entitlement order does not become ineffective by reason

of any later change of circumstances.