J. MILLARD TAWES, Governor                        907

8—302. "Bona Fide Purchaser."—

A "bona fide purchaser" is a purchaser for value in good faith
and without notice of any adverse claim who takes delivery of a
security in bearer form or of one in registered form issued to him
or indorsed to him or in blank

8—303. "Broker".—

"Broker" means a person engaged for all or part of his time in
the business of buying and selling securities, who in the transaction
concerned acts for, or buys a security from or sells a security to a
customer. Nothing in this Sub-title determines the capacity in which
a person acts for purposes of any other statute or rule to which such
person is subject.

8—304. Notice to Purchaser of Adverse Claims.—

(1)  A purchaser (including a broker for the seller or buyer but
excluding an intermediary bank) of a security is charged with notice
of adverse claims if

(a)  the security whether in bearer or registered form has been
indorsed "for collection" or "for surrender" or for some other pur-
pose not involving transfer; or

(b)  the security is in bearer form and has on it an unambiguous
statement that it is the property of a person other than the trans-
feror. The mere writing of a name on a security is not such a state-
ment.

(2)  The fact that the purchaser (including a broker for the seller
or buyer) has notice that the security is held for a third person or
is registered in the name of or indorsed by a fiduciary does not create
a duty of inquiry into the rightfulness of the transfer or constitute
notice of adverse claims. If, however, the purchaser (excluding an
intermediary bank) has knowledge that the proceeds are being
used or that the transaction is for the individual benefit of the fidu-
ciary or otherwise in breech of duty, the purchaser is charged with
notice of adverse claims.

8—305. Staleness as Notice of Adverse Claims.—

An act or event which creates a right to immediate performance
of the principal obligation evidenced by the security or which sets
a date on or after which the security is to be presented or surrendered
for redemption or exchange does not of itself constitute any notice of
adverse claims except in the case of a purchase

(a)  after one year from any date set for such presentment or
surrender for redemption or exchange; or

(b)  after six months from any date set for payment of money
against presentation or surrender of the security if funds are avail-
able for payment on that date.

8—306. Warranties on Presentment and Transfer.—

(1) A person who presents a security for registration of transfer
or for payment or exchange warrants to the issuer that he is entitled