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Information necessary in a stock certificate

If you are looking for a free stock certificate template to download, you should not confuse the template with the actual stock.

A typical stock certificate should have blank fields for the following information:

  • Name of the organization issuing the stocks
  • Location of the organization issuing the stocks
  • The name of the buyers
  • The certificate number
  • The number of shares
  • Minimum price/share if available
  • Whether the buyer is purchasing common or preferred stock
  • Whether there are any restrictions
  • Date of issuance

If the organization has an official corporate seal, then it should be affixed on the certificate.

Common Considerations when applying for a stock certificate

When you are applying for a stock certificate, there are certain things to keep in mind:

  • The certificate does not mention any securities bought, only the shares you purchased.
  • A stock certificate will grant a percentage of a company’s title to the owner of the certificate.
  • The paper used to make the stock certificate is marked in a way that proves the authenticity of the certificate.
  • Legal proceedings can be used by a stockholder.
  • Many organizations don’t issue certificates each time they want to buy stocks. They usually only do this at the first time they do so.
  • That’s why companies store their stock certificates safe electronically so there is no chance of them getting lost.
  • The signature used in stock certificates cannot be digitally administered.

Types of Stock Certificates

Registered stock certificates – Stock certificates are issued to shareholders with rights to their stock. This information appears in the registration records of the organization that issues the stocks.

Bearer stock certificates – If the stocks are held in your name, you have legal rights associated with it. However, shares are transferred all the time, and this certificate is used to transfer the title without paying for stamp duty.

Stock Certificate Samples

How much is your stock certificate worth?

Even if organizations that issued stocks:

  • The company was taken off the active list
  • Merged with another company
  • Changed the name of the company

If you want to make sure your stock certificates are still valuable, there are a few things you can do:

  • Book entry: It’s common practice to keep stock certificates with official organizations such as a brokerage firm, the bank or a transfer agent.
  • Electronic records: Most brokerage firms that handle stocks and bonds keep track of the assets electronically, which allows them to make fast purchases, make dividend payments, and conduct sales through the underlying organization.
  • Direct Registration System: For most stocks, you can now transfer ownership through a Direct Registration System or DRS, which reduces the amount of paperwork and fees.

Types of Markets

You can buy stocks through the primary market, which is also called the new issue market. A new issue is the first opportunity for the general public to purchase stock directly from a corporation.

One of the most common ways to switch stocks is to sell some you already own, but it is not the only way; another way is to borrow stocks from someone else.

Why Organizations Issue Stocks

If you operate your company as a for-profit and you need to raise capital, issuing stock might be a good way to do it.

  • set up a new factory
  • launch a new product,
  • hire more employees on the payroll in order to become more profitable.
  • Merge with another company
  • Decrease debt
  • Give owners of the company more flexibility
  • Pay for new buildings
  • Finance new inventories
  • Make the company more valuable in the stock exchange

The investment banker’s primary goal throughout the process is to ensure that the company maintains a certain degree of transparency, while at the same time ensuring that it meets all federal and state regulations.

Besides this, investors have to make some confidential information public such as earnings. Investors have to be completely aware of their rights via the rights plan which is usually proposed by the management head of the company.

If you hold shares in a company for which you determine, you may also want to know what the board is doing. For example, IBM has decided to issue one right for each common share per shareholder.

Free Stock Certificate Templates

Privileges of a shareholder

You own part of the company

When you purchase stock in a publicly traded company, you basically own part of it. For instance, if you buy a share in Facebook, you will be privy to the same benefits and rights as Mark Zuckerberg who owns more than five hundred million.

You will receive regular progress reports

If you purchase $1 million of shares, you will be sent quarterly and yearly reports that will keep you abreast of the company’s financial progress. These reports will include information about how much money the company has made and lost.

The former is published and comprises of comprehensive data in charts, images and graphs but it provides more or less the same info.

Invitations to Annual Events

As a shareholder of the company, you will get invites to yearly shareholder meetings where you get to meet other shareholders and company executives. You get to vote on matters that are decided by the board.

If you can’t attend the meeting, you can still vote in your absence via an absentee ballot. The main responsibility of the board and the managers during those meetings is to increase the value of the shareholders and to prove the inherent value of the organization.

How to cash in stock certificates

If you come across an old stock certificate, you can sell it by contacting the security’s transfer agent or broker. Before doing so, research how valuable the security really is. It would be wise to have the stock checked out by an expert.

The majority of publicly traded firms make use of transfer agents to manage them as well as individuals who own stock shares in them. For example, Disney acts as its own transfer agent.

These agents have 3 major functions:

  • Cancelling and issuing stock certificates.
  • Organizations will pay interest and dividends of stocks.
  • Managing compromised or lost certificates.

If you want to find out who is handling the stock shares of the company you are working for, first look on the company’s website. If that doesn’t work, try a private firm of transfer agents.

If you have the physical stock certificate, you can ask your agent how to transfer your stocks to direct registration. With direct registration, the agent will keep a record of your stocks. You can also sell your stocks anytime you want via Direct Registration System.

If you choose to go with the paper process, you can get a free stock certificate template. Download it, fill it out and get certified, and mail it to the transfer agent along with tracking information.

You can sell your stock certificate to a stockbroker, but you have to pay for this service. Replacing the certificate itself will cost you 5% of the value, so it would be a good idea to insure the package you mail.

If you decide to sell your stock it can take up to 10 days for the proceeds of sale to be in your account.

Blank Stock Certificate Templates

Why you should use a stock certificate template

A stock certificate that does not have all of the components we discussed will be considered invalid and will not be accepted. Rather than hiring someone to draft one for you, downloading free templates would be a more cost-effective solution.

You can make changes to these templates according to your organizational needs and the investor/shareholder requirement. The final version should be checked by a certified lawyer or a transfer agent to ensure its authenticity.

We have a number of different types of stock certificates, and each is available for free. We encourage you to take as many as necessary so you can get one that suits your needs.

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TrainRocket.com helps you document every process and policy in your business so you can onboard, train, and scale faster.

Get started with TrainRocket.com for FREE!

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