§490:8-503  Property interest of entitlement
holder in financial asset held by securities intermediary.  (a)  To the
extent necessary for a securities intermediary to satisfy all security
entitlements with respect to a particular financial asset, all interests in
that financial asset held by the securities intermediary are held by the
securities intermediary for the entitlement holders, are not property of the
securities intermediary, and are not subject to claims of creditors of the
securities intermediary, except as otherwise provided in section 490:8-511.



(b)  An entitlement holder's property interest
with respect to a particular financial asset under subsection (a) is a pro rata
property interest in all interests in that financial asset held by the securities
intermediary, without regard to the time the entitlement holder acquired the
security entitlement or the time the securities intermediary acquired the
interest in that financial asset.



(c)  An entitlement holder's property interest
with respect to a particular financial asset under subsection (a) may be
enforced against the securities intermediary only by exercise of the
entitlement holder's rights under sections 490:8-505 to 490:8-508.



(d)  An entitlement holder's property interest
with respect to a particular financial asset under subsection (a) may be
enforced against a purchaser of the financial asset or interest therein only
if:



(1)  Insolvency proceedings have been initiated by or
against the securities intermediary;



(2)  The securities intermediary does not have
sufficient interests in the financial asset to satisfy the security
entitlements of all of its entitlement holders to that financial asset;



(3)  The securities intermediary violated its
obligations under section 490:8-504 by transferring the financial asset or
interest therein to the purchaser; and



(4)  The purchaser is not protected under subsection
(e).



The trustee or other liquidator, acting on behalf of
all entitlement holders having security entitlements with respect to a particular
financial asset, may recover the financial asset, or interest therein, from the
purchaser.  If the trustee or other liquidator elects not to pursue that right,
an entitlement holder whose security entitlement remains unsatisfied has the
right to recover its interest in the financial asset from the purchaser.



(e)  An action based on the entitlement
holder's property interest with respect to a particular financial asset under
subsection (a), whether framed in conversion, replevin, constructive trust,
equitable lien, or other theory, may not be asserted against any purchaser of a
financial asset or interest therein who gives value, obtains control, and does
not act in collusion with the securities intermediary in violating the
securities intermediary's obligations under section 490:8-504. [L 1997, c 33,
pt of §2]