What is an Affidavit of Lost Stock Certificate?

Key Takeaways

• A Stock Certificate proves share ownership and is essential for transfers, voting rights, dividends, and protecting shareholder interests.

• To replace a lost Stock Certificate, you must file an Affidavit, purchase an indemnity bond, and pay for a replacement certificate.

• An Affidavit of Lost Stock Certificate is a sworn statement used when a stock certificate is lost, stolen, or destroyed.

• Your Affidavit of Lost Stock Certificate must be commissioned by a notary to make it valid and accepted by the issuing company.

• To avoid future loss, store your certificate securely, keep digital copies, and consider converting it to an electronic format.

• Use NotaryPro’s free template and online commissioning service to easily replace your lost Stock Certificate from anywhere.

Before the internet and online trading platforms existed, companies that sold their shares used to issue Stock Certificates to their shareholders. As technology advanced, these physical Stock Certificates have mainly been replaced by electronic records.

You may still have these physical certificates today, especially if you own older shares. However, what can you do if your physical Stock Certificate is lost, stolen, or damaged beyond repair? 

Here, we explore what to do when you lose a Stock Certificate and how to make the process of replacing it smoother.

What Is a Stock Certificate?

A Stock Certificate, also known as a share certificate, is an official document that proves you own shares in a company. It includes critical information, like your name, the number of shares you own, the date of issue, and the issuing company’s seal. 

Stock Certificates are typically larger than standard paper (8.5 x 11 inches). They also feature intricate designs to prevent forgery and counterfeiting, which was a common problem before the internet revolutionized stock investing. 

In addition to a design, certificates contain details like the date, ID number, and other relevant information. Stock certificates also feature executive signatures, which may be either copied or handwritten. 

Today, many modern investments are held electronically, but you can still request a physical certificate if you prefer. That said, you must choose between a physical or a digital Stock Certificate — you cannot have both. If you request a physical Stock Certificate, ensure that you store it safely and securely. 

What Is an Affidavit of Lost Stock Certificate?

An Affidavit of Lost Stock Certificate is a sworn legal document that declares a Stock Certificate has been lost, stolen, or destroyed. It acts as a formal declaration, outlining the details of how the certificate was lost, damaged, or stolen. 

If you happen to lose your Stock Certificate, you’ll need an Affidavit of Lost Stock Certificate to begin the replacement process. The issuing company or transfer agent often requires you to submit this Affidavit before they can issue a replacement certificate. 

Details to Provide in Your Affidavit of Lost Stock Certificate

If you need to create an Affidavit of Lost Stock Certificate, we have the perfect solution for you. Use our free Affidavit of Lost Stock Certificate template to obtain a replacement certificate quickly and easily. All you need to do is provide some key details, and our platform will automatically format your Affidavit for you. 

Your Affidavit of Lost Stock Certificate should include the following information:

• Your full name and address
• The province or state in which the Affidavit is being signed
• Details about the Stock Certificate, including:
  • Name of the company that issued your Stock Certificate 
  • The province or state where the business was formed
  • Number of shares
  • Class of stock
  • Certificate number for your Stock Certificate
• An explanation that the Stock Certificate was lost, destroyed, or stolen, and any details to support this statement
• An explanation of the actions you’ve taken to recover or locate the missing certificate
• A statement confirming whether the Stock Certificate was endorsed, and if so, details on how it was endorsed

Commissioning an Affidavit of Lost Stock Certificate

After completing your Affidavit, you must have it commissioned. Commissioning involves signing your Affidavit in front of a notary public or commissioner of oaths to make it legally valid.

When you sign your Affidavit, you’re swearing or affirming that the information you’ve provided is true to the best of your knowledge. Intentionally not telling the truth may be considered perjury, which is a serious offence under the Criminal Code of Canada.

You can meet with a notary online to have your Affidavit commissioned online over a quick video call. The following will take place during an online notary appointment:

• You’ll present your ID to the notary, and they’ll verify your identity
• The notary will administer an oath or affirmation, asking you to confirm that the contents of your Affidavit are truthful to the best of your knowledge
• The notary will ensure you understand what you are signing
• They’ll also ensure you are signing willingly, without coercion
• You’ll sign and date your Affidavit, and the notary will witness your signature
• The notary will also sign your Affidavit and apply their official seal

Our online notary service makes commissioning your Affidavit fast and convenient. You can book a virtual appointment and have your Affidavit commissioned in under 7 minutes, from anywhere. 

You can book an Instant appointment or choose a time that works best for you, including mornings, evenings, and weekends. Enjoy the convenience of meeting with a notary from your smartphone, tablet, or computer through our trusted platform.

When Do You Need a Stock Certificate?

A Stock Certificate does more than prove ownership. It’s essential for legal, financial, and corporate situations that affect your rights as a shareholder.

Here are a few situations you’ll need a Stock Certificate for:

• Demonstrate Proof of Ownership: A Stock Certificate officially confirms how many shares you own in a company. You can use it as evidence if there’s ever a dispute or question about your ownership.
• Facilitate Transfer of Shares: If you need to transfer or give your shares to someone else, you need a Stock Certificate to make the transfer official.
• Establish Voting Rights: When you’re issued a Stock Certificate, you have the right to vote on important corporate decisions.
• Confirm Entitlement to Dividend Payments: If the company pays out profits (also known as dividends), your Stock Certificate helps confirm that you’re entitled to receive them.
• Receive Corporate Benefits: Some Stock Certificates come with additional perks, such as exclusive discounts for shareholders.
• Acquire Legal Protection: If something big happens, like a merger or a legal issue, a Stock Certificate can help protect your rights.

What Happens When a Stock Certificate Is Lost?

Losing your Stock Certificate can be unsettling. The good news is that your ownership of shares remains intact. Nevertheless, losing a Stock Certificate can result in the following complications:

• Prevention of Transactions: Without a physical Stock Certificate, you cannot sell, transfer, or claim profits on your shares.
• Risk of Fraud or Unauthorized Transfer: If someone finds your Stock Certificate, they may attempt to transfer or sell your shares fraudulently.

Immediate Actions to Take if You Lose a Stock Certificate

If you lose a Stock Certificate, you need to act quickly to protect your shares and start the replacement process. Here are some crucial steps you should take as soon as possible:

Contact the Issuing Company or Transfer Agent

Stock Certificates are either managed by the company that issued them or by a third party known as a transfer agent. Transfer agents assist in maintaining shareholder records, processing ownership transfers, and handling certificate replacements. Some companies serve as their own agents, while others pay banks, trust companies, or financial institutions to handle these tasks.

Notify the issuing company or its transfer agent about the lost certificate right away. They’ll place a “stop transfer” on the missing certificate to prevent anyone from using it fraudulently. The transfer agent or issuing company will also notify the Securities and Exchange Commission about your lost Stock Certificate. 

Complete an Affidavit of Lost Stock Certificate

Next, you’ll need to fill out an Affidavit of Lost Stock Certificate to declare that your certificate was lost, destroyed, or stolen. This Affidavit also serves as your application for a new Stock Certificate. 

You can use our free Affidavit of Lost Stock Certificate template to make drafting your Affidavit easy. Simply fill in the blanks with the required information, and you’ll have a properly formatted Affidavit ready in minutes.

Purchase an Indemnity Bond

Before the issuing company or transfer agent can give you a replacement certificate, you’ll likely need to purchase an indemnity bond. An Indemnity bond is also known as a lost instrument bond. 

This bond protects the company and the transfer agent in case someone finds the original certificate and tries to redeem it fraudulently. An Indemnity bond usually costs 2% to 3% of the current market value of your missing Stock Certificate.

Purchase a Replacement Certificate

In addition to the indemnity bond, you’ll need to pay a fee to have a replacement Stock Certificate issued. Costs vary depending on the transfer agent or company; it’s best to ask how much a replacement certificate would cost before proceeding.

Request for a Replacement Certificate

If your Stock Certificate falls into the wrong hands and is transferred to an unknowing purchaser, things can get complicated. The transfer agent or issuing company may struggle to confirm that you’re the rightful owner. Therefore, you should act promptly and request a replacement certificate before someone else claims it.

How Long Does It Take To Replace a Lost Stock Certificate?

In most cases, it takes about 2 to 6 weeks to receive a replacement Stock Certificate after submitting all the necessary documents. These include your Affidavit, indemnity bond, and any supporting identification or ownership records.

However, several factors can delay the process, including:

• Missing or incomplete documentation
• Errors in your personal information
• Processing backlogs with the transfer agent, issuing company, or bonding provider

To avoid delays, ensure your Affidavit is accurate and that your indemnity bond is submitted promptly. You can follow up with the issuing company or transfer agent if you don’t hear back within a few weeks.

Finding Your Old Certificate After Reporting It Lost

If you happen to find your missing Stock Certificate after reporting it lost, don’t use it. It may already be marked as invalid. Attempting to use an old certificate after it has been reported as missing could lead to legal consequences.

Instead, contact the issuing company or transfer agent immediately and let them know you’ve found it. If the replacement process hasn’t been finalized yet, they can update their records and cancel any stop-transfer notices.

If a replacement certificate has already been issued, the original certificate will be permanently cancelled. The transfer agent or issuing company will formally document this cancellation and notify you. You’ll also be asked to return or destroy the old certificate to avoid confusion.

How to Avoid Losing a Stock Certificate

Replacing a lost Stock Certificate can be a time-consuming and expensive procedure. Once you’ve been through the process, you’ll want to avoid experiencing it again. Here are some steps to help you avoid losing another Stock Certificate:

Store Your Certificate in a Secure Location

Physical Stock Certificates are valuable legal documents. Store them in a secure location, such as a home safe or a bank safe deposit box. Avoid drawers, folders, and random files that can be misplaced or forgotten over time.

Tell a Trusted Person Where Your Certificate Is

Make sure a family member, spouse, or trusted contact knows where you store your Stock Certificate. If something happens to you, they’ll easily be able to locate it.

Make Copies of Your Certificate for Reference

Before storing your certificate, scan both sides and save a digital copy in a password-protected folder. You can also print photocopies and store them separately. If the original certificate is lost, these copies help you retrieve important details, like the certificate number, when requesting a replacement.

Record Essential Certificate Details Separately

Besides keeping a copy, write down the company name, certificate number, issue date, and number of shares. Keep these details in a different location from the certificate. If your certificate is ever misplaced, having this information on hand can significantly speed up the replacement process.

Ask Your Transfer Agent About Electronic Options

If you’re worried about losing the physical copy again, you may be able to convert your paper certificate to an electronic format. Many transfer agents offer a direct registration system (DRS), which records your shares digitally in your name. This option eliminates the risk of physical loss altogether.

Have Your Affidavit of Lost Stock Certificate Commissioned Today

Losing your Stock Certificate can feel stressful, but you can take the necessary steps to protect your investment and prevent further delays.

If you’ve lost a Stock Certificate, our free Affidavit of Lost Stock Certificate template makes it simple and efficient to start the replacement process. Once your Affidavit is ready, you can have it commissioned online in just 7 minutes. NotaryPro connects you with a licensed notary for the online commissioning process right from your device, wherever you may be.

Schedule your online notary appointment today to commission your Affidavit of Lost Stock Certificate and start the replacement process without delay.