Q: I’ve lost the stock certificate that shows that I own shares in a private company. What can I do?
A: Your stock certificate proves ownership of shares in a company, much like the title to a car. The certificate is not the asset itself.
Every corporation is required to maintain a ledger of owners and certificates issued. As long as you notify the corporation soon after you discover the certificate is missing, you should have no problem getting a new certificate.
What if the corporation has lost or poorly maintained its stock registry? You might have a problem. The corporation will have to reconstruct a registry using information that should be in the articles of incorporation, minutes of shareholder and director meetings, other documents or correspondence, and certificates held by other shareholders.
Some corporations may elect not to issue certificates at all. They’ll still maintain a ledger of owners and shares, but instead of mailing certificates they’ll just issue an “information statement.”
Keep in mind that, as a shareholder, you have the right to review – or have your representative review – the corporate books and records (which include the ownership ledger) with reasonable notice and during normal business hours.
This article originally appeared in The Business Owner Journal, the periodical of choice for owners of small and midsize private businesses. All rights reserved, D.L. Perkins LLC. © 2012.
This publication is intended to provide general information on the subject matters covered. It is sold and distributed with the understanding that neither the publisher nor any distributor or advertiser is engaged in providing legal, tax, insurance, investment or other professional advice. The advice of a qualified professional should be sought before any reader applies a concept presented herein to his or her particular situation or business.
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