|
A Lost Securities Bond, sometimes called a Lost Instrument Bond or Lost Document Bond, is required when a person or corporation has lost, mislaid or destroyed an original document that evidences ownership. Such instruments can be certificates of stock ownership, life insurance policies, common or preferred stock as well as federal, provincial, municipal or corporate bonds. The bond of indemnity, as it is also called, provides that the issuer of the replacement security will not suffer economic loss should the lost instrument turn up later.
When an individual or corporation has lost, destroyed or had stolen their certificates of stocks, bonds, debentures or warrants etc., the issuing corporation requires that the registered owner of the certificate(s) of stock, bonds, debentures or warrants etc. post security in the form of a Lost Securities Bond so that the issuing corporation may provide a replacement certificate.
In the event that the original certificate turns up later, the owner of the certificate must return the original certificate to the issuing company or transfer agent for cancellation. If however, the original certificate is presented for payment or transfer in good form, the Lost Securities Bond guarantees that the principal and the surety on the bond will jointly and severally reimburse the issuing company, transfer agent, registrar or depository for any loss incurred should the original certificate be presented in good form and the transfer completed.
|
