Legal Definitions - holder of record

A holder of record is the individual or entity officially listed in the formal records of an organization or a public registry as the legal owner of a particular asset. This official registration is crucial because it determines who possesses the legal rights associated with that asset, such as the right to vote, receive income, or transfer ownership. While frequently used in the context of corporate shares (where the term "stockholder of record" is common), the concept applies more broadly to various types of assets where official ownership records are maintained.

• Example 1: Publicly Traded Company Shares

  Imagine David purchases 500 shares of a technology company, "InnovateTech Inc.," through his investment brokerage account. When InnovateTech Inc. maintains its official list of shareholders, David's brokerage firm might be listed as the holder of record for those shares, especially if they are held in "street name." The brokerage firm then holds these shares on David's behalf as the beneficial owner. If David had purchased the shares directly from InnovateTech's transfer agent and received a physical stock certificate or direct registration, then David himself would be the holder of record. This distinction is important for how David receives proxy materials for voting or dividend payments directly from the company.

• Example 2: Real Estate Ownership

  Consider a couple, Maria and Roberto, who buy a new condominium. After the purchase is finalized, their names are formally inscribed on the property deed, which is then submitted and recorded with the local county recorder's office. This official filing makes Maria and Roberto the holders of record for that condominium. This status legally confirms their ownership, granting them the exclusive right to live in, sell, or mortgage the property, and making them responsible for property taxes.

• Example 3: Vehicle Registration

  Suppose Sarah buys a used motorcycle from a private seller. After completing the sale, she must register the motorcycle with her state's Department of Motor Vehicles (DMV) and have the vehicle title transferred into her name. Once the DMV processes this change and issues a new title reflecting her ownership, Sarah becomes the holder of record for that motorcycle. This official registration proves her legal ownership, allowing her to legally operate the vehicle, obtain insurance, or sell it to another party in the future.