How to register physical share certificates

Physical share certificates (also known as stock certificates) are a form of ownership for certain types of investments. Although the majority of trading is now online and electronic, physical shares may still be issued in certificate form for certain companies. Physical share certificates are official documents that state the ownership of shares, and may or may not have restrictions for trading.

This can be common for the following scenarios:

• Pre-IPO, or IPO investments
• Employee share purchase plans (ESPP)
• Vested stocks, or employee stock options
• GICs
• Exempt market products

A transfer agent is a trust company, who is assigned by a publicly-traded corporation to maintain investor’s financial records. Each publicly traded company may have a different transfer agent, and you can usually view your specific transfer agent on the front bottom or back of your physical share certificate. If this information cannot be found on the certificate, you can usually find this information for the company on their website under the ‘investor relations’ area, or simply try an online search for the company name + “transfer agent”.

Some examples of popular transfer agents include:

• Computershare
• AST Trust company
• TSX Trust
• Solium Capital
• Odyssey Trust

If your securities are held in physical certificate form, you may need to contact the issuer’s Transfer Agent to have the holding converted to DRS (Direct Registration System) format. DRS is an electronic version of a physical certificate.

Questrade can deposit your DRS securities into your self-directed trading account. This enables you to trade the security in the open market. Check the bottom of this article for detailed instructions regarding depositing your DRS securities at Questrade.

Direct Registration System (DRS) allows registered securities to be held in electronic form without having a physical security certificate issued as evidence of ownership. DRS essentially ‘replaces’ the physical share certificate, and instead the shares are registered electronically with the transfer agent. You are usually issued statements/DRS receipts quarterly, or monthly depending on the specific agent.

Once your shares are registered electronically with the transfer agent, you can easily request a transfer to your Questrade account.

Some transfer agents may be able to start the transfer from their end, if the transfer agent is “starting” the process from their side, please provide them with the following information:

• Questrade’s CUID code/number: QSTR
• DTC code/number: 5084
• Your self-directed Questrade account number

If you’d like to submit the request to Questrade directly, you will need to upload the following documents:

1. DRS statement (from the transfer agent)
   • Must be issued within 2 months
   • Must show matching customer name, number of shares, company name and CUSIP
   • Shares must not be under restrictions of any kind, please see below for more information
2. Shares/Warrants Deposit Request form.
   • Complete the Shares/Warrants Deposit Request form.
   • Go to the Upload documents tab under Account Management.
   • Upload the Shares/Warrants Deposit Request form and choose Letter of direction as the document type of the form.
3. For U.S. securities only: Power of Attorney form
   • The original, hand-signed copy must be physically mailed in due to our regulators
   • You must leave “Name of transferee” and “Address of transferee” blank when completing the form

DRS transfers may take 5-10 business days to process.

DRS transfers cost $300+HST to process per security if started from Questrade.

If you are transferring to a brand-new Questrade account, you will first need to fund the account with $300+HST to cover the transfer fee before we can begin the process. Fees can only be charged to the destination account for the transfer if you have multiple accounts.

Please keep the following restrictions in mind if requesting a DRS transfer:

• OTC/Pink sheet securities are not eligible for DRS transfer into a Questrade account
  CSE (.cn) securities are only acceptable for transfer if the following requirements are met:
  • Is currently trading
  • Has a unique CUSIP
  • Eligible for deposit into CDS
  • Is unrestricted (Due to the volatile nature of CSE listed securities)
• Fractional shares cannot be transferred via DRS
• Non CDS/DTC eligible securities - Not eligible for transfer
• 1933 Securities restriction - Not eligible for transfer
• Date restrictions beyond 1 month in the future - Not eligible for transfer
  • This can be found on the back of the certificate/DRS statement and will usually state: “Cannot be sold/transferremeans we cannot process the transfer until this date
  • This means we cannot process the transfer until this date

Note: The information in this blog is for educational purposes only and should not be used or construed as financial or investment advice by any individual. Information obtained from third parties is believed to be reliable, but no representations or warranty, expressed or implied, is made by Questrade, Inc., its affiliates or any other person to its accuracy.