§ 394 — Lost or destroyed certificate of stock

New York § 394

• Jurisdiction: New York
• Law GBS: General Business
• Art. 26: Miscellaneous

Text

§ 394. Lost or destroyed certificate of stock. 1. The owner of shares\nrepresented by a lost or destroyed certificate of stock, if the\ncorporation shall refuse to issue a new certificate in place thereof,\nmay apply to the supreme court, at any special term held in the district\nwhere he resides, or in which the office of the corporation is located,\nfor an order requiring the corporation to show cause why it should not\nbe required to issue a new certificate in place of the one lost or\ndestroyed. The application shall be by petition, duly verified by the\nowner, stating that it is made pursuant to this section, the name of the\ncorporation, the number and date of the certificate and to whom issued,\nif known or if it can be ascertained by the petitioner, the number of\nshares represented thereby, and as particular a statement of the\ncircumstances attending such loss or destruction as the petitioner can\ngive. Upon the presentation of the petition the court shall make an\norder requiring the corporation to show cause, at a time and place\ntherein mentioned, why it should not issue a new certificate of stock in\nplace of the one described in the petition. A copy of the petition and\norder shall be served on the corporation, in the manner prescribed for\nthe service of a summons in an action against a corporation, at least\ntwenty days before the return of the order to show cause. Notice of the\napplication shall be given to the stockholder of record if he is a\nperson other than the petitioner and if he is known to the petitioner,\nand to such other persons as the court may direct; such notice shall be\ngiven in such manner by publication or otherwise as the court may\ndirect.\n 2. Upon the return of the order, with proof of due service thereof,\nthe court shall inquire into the truth of the allegations of the\npetition and hear the proofs of the parties in regard thereto. The\ncourt, if satisfied that the petitioner is the lawful owner of the\nshares, or any part thereof, described in the petition, and that the\ncertificate therefor has been lost or destroyed and cannot after due\ndiligence be found, and that no sufficient cause has been shown why a\nnew certificate should not be issued, shall make an order requiring the\ncorporation, within a time specified, to issue and deliver to the\npetitioner a new certificate for the number of shares specified in the\norder, upon the petitioner depositing in such public office as the court\nmay designate security or a bond to indemnify the corporation against\nany liability or expense which it may incur by reason of the original\ncertificate remaining outstanding. Such security or bond shall be in an\namount which shall appear to the court sufficient in the circumstances\nof the case to protect the interests of any persons to whom the\ncorporation may incur liability, and shall be in such form and with such\nsureties as the court shall approve. The court may also in its\ndiscretion order the payment of the corporation's reasonable costs and\ncounsel fees.\n 3. The issuance of a new certificate under an order of the court shall\nnot relieve the corporation from liability in damages to a transferee of\nthe original certificate in good faith and for value. The corporation\nshall not be liable to any such transferee in an amount in excess of the\namount of the bond or the amount of the security required to be\ndeposited.\n 4. In case of conflict between this section and section 8--405 or\n8--406 of the uniform commercial code, this section shall control.\n