KRS 355.8-109: Warranties in indirect holding.

(1) A person who originates an entitlement order to a securities intermediary warrants

to the securities intermediary that:

(a) The entitlement order is made by an appropriate person, or if the entitlement

order is by an agent, the agent has actual authority t o act on behalf of the

appropriate person; and

(b) There is no adverse claim to the security entitlement.

(2) A person who delivers a security certificate to a securities intermediary for credit to

a securities account or originates an instruction with res pect to an uncertificated

security directing that the uncertificated security be credited to a securities account

makes to the securities intermediary the warranties specified in KRS 355.8 -108(1)

or (2).

(3) If a securities intermediary delivers a security certificate to its entitlement holder or

causes its entitlement holder to be registered as the owner of an uncertificated

security, the securities intermediary makes to the entitlement holder the warranties

specified in KRS 355.8-108(1) or (2).