Category: 

What are Blank Stock Certificates?

Article Details
  • Written By: Ray Hawk
  • Edited By: A. Joseph
  • Last Modified Date: 23 September 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
  • Print this Article
Free Widgets for your Site/Blog
Built at the request of Dag Hammarskjöld, the United Nations Headquarters has a meditation room dedicated to silence.   more...

October 1 ,  1890 :  Yosemite National Park was established.  more...

Blank stock certificates are stocks issued to an investor or group of investors that don’t immediately have any rights assigned to them, such as voting rights within the company. Such stock also initially does not have any guaranteed right to payment of dividends from the company. All the rights that can be assigned to such stock are determined after the fact by the corporation’s board of directors.

Stock certificates are generally issued in two forms: registered certificates and bearer certificates. Registered certificates are issued to specific individuals or corporations, and bearer stocks are a more liquid form of investment, similar to cash. Bearer stocks can be owned by anyone, allowing the exercise of voting rights within the corporation by simple physical possession of the stock. In this sense, blank stock certificates share a similarity to bearer stock in that they both provide a more anonymous form of involvement in a corporation.

The actual value of blank stock certificates, however, unlike bearer or registered stock, is undetermined until decided upon by the board of directors of the company that issued them. These certificates are offered for sale as a certificate template by many commercial printers and sold to corporations who hold onto them for future stock-issuing periods. Release of stock certificates of any type, however, is becoming increasingly uncommon in countries such as the United States, where electronic registration of stock ownership is supplanting the issuing of actual paper certificates to stock holders.

Ad

Legal firms representing corporations are usually responsible for printing stock certificates. Prior to the dominance of electronic stock registration, these firms were involved in the time-consuming task of printing thousands of such certificates for corporate clients. Complicating this is the fact that registered stock must include individual shareholder information such as the name of the investor, the number of stocks they own, as well as legal wording on the back governing transfer restrictions etc. A workaround for this was the creation of blank stock certificates.

Using blank stock certificates streamlines the stock-issuing process. A blank certificate has to contain only the proprietary border and designs that represent the company for which it is issued. Furthermore, some blank certificate designs are meant to be universal, so that they can later be customized to accommodate the needs of a variety of corporations. The company name and identifying information are added at a later date to these blank stock certificates. A common printer term for blank stock certificates is "border-only certificates."

Ad

You might also Like

Recommended

Discuss this Article

Post your comments

Post Anonymously

Login

username
password
forgot password?

Register

username
password
confirm
email