Share Certificates Lost in Post - Indemnity?

barak

muhasib wrote: »

....so this isn't done for free even if notified immediately.

I now accept that. As I said subsequently, in my case it may have been that there was a general problem with the issuing of certificates and the registrar accepted that some were never issued.

billclark_2

My partner has some problems with the Cadbury takeover by Kraft, and we would greatly appreciate any help. She is an ex-Cadbury employee shareholder, having purchased shares through their Sharesave schemes for 20 years.
She had Cadbury Schweppes shares in a number of small value certificates but these were then combined into a single holding and she cannot find the Cadbury share certificate. Computershare (the Registrar) says that she needs a replacement share certificate before she can claim the new Kraft offer and that she needs to get a letter of indemnity signed but we are unable to do so as the value of the share certificate is greater than £50,000 which is the limit companies will do.
We do not see why she needs this letter of indemnity as the Cadbury share certificate will cease to have any value within a few days. In addition the shares are in her name at this address where she has lived for 35 years. Even if the certificate were found it would cease to be traded after Kraft take over, and if it was presented it is still in her name, so would be checked and not paid out to another name and/or address. So I think that there is no actual risk of loss.
This is not a normal situation. We are not seeking a new certificate in an ongoing company, so she can sell some shares. This is a company that will not be trading under that name in a short time; in addition it is not her choice but has been forced upon us. We are not ‘professional’ shareholders; she was just investing in the company she worked for, through their Sharesave schemes, to build up money for our retirement which is due shortly. We are worried this will not now happen.
Do you know who will issue an indemnity to cover these shares?
We tried the main high street bank we have been with for years and they were no help, Computershare will not help us either but still insist on an indemnity for some reason.

Help!!

Richard_DandR

Compulsory acquisition Kraft Foods intends, assuming it becomes so entitled (by receiving 90 per cent. acceptances), to acquire compulsorily any outstanding Cadbury Shares (including any Cadbury Shares represented by Cadbury ADSs) pursuant to the provisions of the 2006 Act.
http://www.cadburyinvestors.com/cadbury_event/press_releases/2010press/2010-02-05/

If you are prepared to wait for this process to be completed, they should send your partner the Kraft shares and cash without having to supply the certificates. They should be working from the register held by Computershare.

Just had a thought. If the value is greater than £50,000 it is likely the gain will turn out to be £20k+. For CGT purposes, it would be best to have the cash proceeds in this tax year and to sell the Kraft shares in the next (after 5 April), assuming that your partner wants to sell the shares.

If the overall gain is £20k and taken in just one tax year, your partner could have a CGT liability of around £1,800. Split it over two tax years and the CGT allowances would reduce the tax significantly.

I would suggest try your bank and see if they can help. It may cost a bit but save a tax liability. Have you tried any of the suggestions above?

and a bit more:
Kraft Foods, Inc. Announces Offer Update For Cadbury plc
Monday, 15 Feb 2010 11:54am EST

Kraft Foods, Inc. announced that as at 1.00 p.m. (London time) on February 12, 2010, Kraft Foods had received valid acceptances of the Offer in respect of 1,254,238,458 Cadbury plc Shares (including those represented by Cadbury ADSs), representing approximately 90.76% of the existing issued share capital of Cadbury and approximately 90.76% of the voting rights of Cadbury. Consequently, Kraft Foods is commencing the procedure under Chapter 3 of Part 28 of the 2006 Act to acquire compulsorily all of the outstanding Cadbury Shares (including any Cadbury Shares represented by Cadbury ADSs) which it does not already hold or has not already acquired, contracted to acquire or in respect of which it has not already received valid acceptances.



http://www.reuters.com/finance/stocks/keyDevelopments?rpc=66&symbol=CBRY.L&timestamp=20100217133000

Also a 10p per share dividend is being paid and you should receive that in the normal way.

bluepebblemoney

BillClark - If you lose share certificates you can arrange for indemnity through various different companies if your bank refuses to sign. Most registrars will have a value limit of either £50,000 or £100,000. Try Royal Sun Alliance 01403 233 642 or R Dowles 0207 426 5330, where the cost is going to be about 0.5 to 1% of the share value. If you don't feel you can sort it yourself you can use a company like Blue Pebble Money or similar who will charge an additional £129 incl vat above the idemnity cost.
You may want to consider splitting the shares to utilize both yours and your spouse CGT allowance.

surreysaver

I wouldn't rely on Computershare for anything.