When bearer coupon bonds are presented for registration they should be accompanied by a written memorandum giving the following information: amount, date, title, and particular issue of bonds, whether to be registered fully or as to principal only, in whose name to be registered, address, bond numbers, number of next due coupon, and name of the firm or individual presenting the bonds. If the bonds are presented for transfer over the win dow, a ticket is given to the person presenting them, and they are delivered only upon the return of the ticket properly filled in and signed. Should bonds be received by registered mail or express, they are returned after registration in the same way as received.
When bonds registered either fully or as to principal only are presented for transfer and registration, the bank may require an irrevocable bond power to he executed by the registered holder, and if the signature is unfamiliar, the bank may require it either to be guaranteed by another bank or by a member of the local stock exchange or to be acknowledged before a notary public. In the case of such an acknowledgment, the bank may require the county clerk's certificate as to the authority of the notary to be attached to the acknowledgment.
When bonds are fully registered, an interest order must be executed by the registered holder, stating to whom interest is to be paid and the address of the payee.
The following books are used in transferring and registering bonds: i. The Transfer Book. This contains the names of the per sons from whom and to whom the bonds were transferred, the bond numbers, and, in the case of coupon bonds, the number of the coupon next due, the ledger folio number of the account, and a record of whether the bonds were received by registered mail, express, or over the window.
2. The Index. This contains the names and addresses of all registered bondholders, the total amount of bonds held by each, and, in the case of fully registered bonds, the name of the person to whom the registered interest is to be paid.
3. The Ledger. In this are recorded the names of the regis tered bondholders, the bond numbers, the dates on which the bonds were registered, the dates on which they were transferred from one name to another, and the total amount of bonds regis tered in each name.
4. The Recapitulation Book. This gives the total amount of registered coupon bonds and the total amount of fully registered bonds.
No record is kept of bearer bonds.
The Payment of Registered Interest The bank may or may not handle the payment of the regis tered interest on the issues of bonds for which it acts as registrar.
At the request of the corporation, the bank may furnish it with a list of the fully registered bondholders, and the checks for the registered interest may be mailed direct from the corporation's office. On the other hand, the corporation may send the bank a
check for the total amount of the registered interest and have the bank mail checks to the registered bondholders, in accordance with the mailing orders on file with the department. Such a check is credited to a special account and the checks which the bank sends are charged to this account as they are returned and paid. After the checks have been mailed a list is sent to the com pany giving the names of the registered bondholders, the total of the bonds held by each of them, and the amount of the check mailed to each one.
Transfer Agent for Corporate Stocks A certificate of stock is usually an engraved piece of paper bearing the signatures of the president and treasurer of the issu ing company and specifying that the holder whose name is writ ten on the certificate is the owner of a certain number of shares and that the shares are transferable only on the books of the com pany in person or by attorney upon surrender of the certificate. The certificates are usually made out for loo shares or some other round lot, depending upon the trading unit of the stock exchange. Although some exchanges provide for "odd lot" sales, say, for example, 47 shares, generally the holder of such lots is at a dis advantage when he wishes to sell; and the necessity for a separate certificate for each share of stock is a cumbersome method of handling and transfer. If a stock exchange adopts, say, a ioo share trading unit, it may require that certificates for too-share lots be printed from a distinctive plate and by a concern approved by the governing board. These and other precautions are taken against counterfeiting.
A corporation may have its certificates transferred by a trans fer clerk in its own offices. If, however, its stocks are very active in the market and if it has large issues outstanding, the work of transferring the certificates of ownership on the books of the com pany may become a large task, and to facilitate transfers, the listing committee of the stock exchange may require the company to provide a transfer agent in the financial district of the ex change. In fact, it is now customary for corporations to appoint another responsible company, usually a bank or trust company, to perform this function of transfer agent. Such bank or trust company may act in this capacity for many corporations—up to a hundred, or even more—delegating this work to its transfer department.