A Primer on Investing in and Owning Stocks
Issuance of Stock Certificates
Buyers of shares who want their names to be recognized in the company’s stock and transfer books should specifically request their stockbrokers that stock certificates be issued under their names. Buyers who do not do so will have ownership of their shares under “street” or “scripless form” under the name of the stockbroker. In the absence of a proxy, the registered owner has voting rights to the shares of stock.
A stock certificate is the proof of owernship / right to ownership in a company. Ownership of shares can be transferred once the corrpesponding stock certificate is endorsed or signed by the owner at the back thereof. Stock certificates should be safeguarded properly. They should not be endorsed at the back until there is a sale or transfer.
Replacement of Lost or Destroyed Stock Certificates
Should your stock certificates become lost, stolen, or destroyed, please immediately notify FPHC or its stock transfer agent in writing so that transfers may not be allowed to avoid any unscrupulous selling of the shares. Pursuant to the Corporation Code and FPHC’s By-Laws, the registered owner should submit the following: (1) an Affidavit of Loss indicating, among others, the nature of the loss or destruction, the stock certificate number(s), and the number of shares involved; (2) an Affidavit of publication from the publisher evidencing that the loss was published in a newspaper of general circulation once a week for 3 consecutive weeks, (3) a surety bond equivalent to 150% of the market value of the shares, should you decide to have the replacement stock certificate issued within one year from the last publication date. Otherwise, the replacement stock certificate shall be issued one year after the last publication date, and (4) transfer fees charged by FPHC’s stock transfer agent.
Replacement of Stock Certificates Due to Change in Legal Name
In most cases, change in legal name arises due to marriage of a female stockholder. For the registered ownership of the stock certificate to be changed, the following is required: (1) a signed letter from the stockholder requesting the change in name; (2) duly endorsed stock certificate(s); (3) submission of a certified true copy of the legal document (e.g. marriage contract) evidencing the change in name, and (4) transfer fees charged by FPHC’s stock transfer agent.
Direct Transfers (DTs) are stock transactions where a registered stockholder transfers his or her shares of stock to another party outside the PSE, usually from an “over-the-counter” transaction mutually agreed upon by the buyer and seller.
For FPHC or its stock transfer agent to register DTs, the parties should submit to the stock transfer agent the following: (1) duly-endorsed stock certificates; (2) a Deed of Sale or Assignment, (3) proof of payment of the capital gains tax, including a Certificate Authorizing Registration issued by the Bureau of Internal Revenue; (4) specimen signature cards of the new owner, (5) a copy of valid identification cards (if the new owner is an individual) or Articles of Incorporation, By-Laws, and List of authorized signatories (if the new owner is a corporation), and (6) transfer fees to be charged by FPHC’s stock transfer agent.
Alternatively, direct transfers may be coursed through PSE-licensed stockbrokers who can effect a “cross-sale” in the PSE trading floor. In such instance, the stockbroker arranges for the remittance of taxes. In lieu of the capital gains tax, stockholders will be charged sales transation tax equivalent to 1/2 of 1% of the market value of the shares crossed. In addition, brokers normally charge commission for DTs.
Change of Mailing Address
Stockholders who have changed their address and wishes that their records with the compay or stock transfer agent be updated should send a signed letter request and a copy of two (2) valid identification cards. Stockholders are encouraged to regularly update their addresses to ensure receipt of company notices or dividends.