HARRY HUGHES, Governor

3723

security OR ON STATEMENTS OF UNCERTIFICATED SECURITIES SENT
PURSUANT TO § 8-408.

(3) With respect to registration of transfer, PLEDGE OR
RELEASE (Subtitle 4 of this title), "issuer" means a person on
whose behalf transfer books are maintained.

8-202.

(1)  Even against a purchaser for value and without notice,
the terms of a security include:

(A)   IF THE SECURITY IS CERTIFICATED, those stated on
the security; [and]

(B)  IF THE SECURITY IS UNCERTIFICATED, THOSE
CONTAINED IN THE INITIAL TRANSACTION STATEMENT SENT TO THE
PURCHASER, OR IF HIS INTEREST IS TRANSFERRED TO HIM OTHER THAN BY
REGISTRATION OF TRANSFER, PLEDGE OR RELEASE, THE INITIAL
TRANSACTION STATEMENT SENT TO THE REGISTERED OWNER OR REGISTERED
PLEDGEE; AND

(C)   [those] THOSE made part of the security by
reference, ON THE CERTIFICATED SECURITY OR IN THE INITIAL
TRANSACTION STATEMENT, to another instrument, indenture or
document or to a constitution, statute, ordinance, rule,
regulation, order or the like, to the extent that the terms [so]
referred to do not conflict with the [stated] terms STATED ON THE
CERTIFICATED SECURITY OR CONTAINED IN THE STATEMENT. [Such a] A
reference UNDER THIS PARAGRAPH does not of itself charge a
purchaser for value with notice of a defect going to the validity
of the security even though the CERTIFICATED security OR
STATEMENT expressly states that a person accepting it admits
[such] notice.

(2)  [(a)] A CERTIFICATED security IN THE HANDS OF A
PURCHASER FOR VALUE OR AN UNCERTIFICATED SECURITY AS TO WHICH AN
INITIAL TRANSACTION STATEMENT HAS BEEN SENT TO A PURCHASER FOR
VALUE, other than [one] A SECURITY issued by a government or
governmental agency or unit even though issued with a defect
going to its validity is valid [in the hands of a] WITH RESPECT
TO THE purchaser [for value and] IF HE IS without notice of the
particular defect unless the defect involves a violation of
constitutional provisions in which case the security is valid [in
the hands of] WITH RESPECT TO a subsequent purchaser for value
and without notice of the defect.

[(b) The rule of subparagraph (a)] THIS SUBSECTION
applies to an issuer [which] THAT is a government or governmental
agency or unit only if either there has been substantial
compliance with the legal requirements governing the issue or the
issuer has received a substantial consideration for the issue as
a whole or for the particular security and a stated purpose of
the issue is one for which the issuer has power to borrow money
or issue the security.