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Appendix A Part 8. Policy For Donated Securities


I. Purpose

To provide guidelines to those involved in the process of soliciting, receiving and selling donated securities. Following these guidelines will insure the proper receipt disposition of gifted securities.

II. Types of Securities

A. Common Stock
B. Preferred Stock
C. Classified Common Stock (Class A/Class B)
D. Bonds or other fixed-income securities
     Common stocks are by far the most frequently received securities

III. Method of Donating Securities

A. Book entry through Depository Trust Corporation (DTC) - This is the recommended method of transferring donated securities. DTC is a service company owned by the banks and brokerage houses of the securities industry and serves as a clearinghouse by using automated book-entry delivery.

1. The donor should be encouraged to instruct their broker to "DTC" the donated securities from their account to an appropriate Auburn University Foundation (AUF) account. The following information is needed to complete this transfer:

Auburn University Foundation
Morgan Stanley Smith Barney
(DTC) 0015
Account Number 464-036526-712
Contact Name: Joni Brackett 888-599-9651
(Local) 821-1300 (Fax) 821-1310

The contact person for stock gifts and mutual fund gifts is Sylvia Huggins, Director of Endowment Investment Office, 844-5235.

Please note that mutual funds cannot be received through DTC.

2. By transferring (DTC) securities to the AUF account, the Foundation is able to expedite the receipt and sale of the donated securities and do so at a minimum cost.

3. If for some reason it is deemed appropriate to establish another AUF account for the receipt of donated securities, the AUF account must meet the following requirement:

a. The Executive Vice President and Assistant Treasurer must authorize the establishment of any AUF brokerage accounts. This is in accordance with AUF Board Policy.
b. The commission on the sale of securities must be no more than $.10 per share.
c. All maintenance or other annual fees must be waived.

The Offices of Development Accounting and the Office of Treasury Services must be notified of incoming DTC transfers.

B. Physical delivery of security certificates

1. Delivered in person: The receipt of the certificate must be properly endorsed without alteration or enlargement and signed exactly as the name appears on the face of the certificate. The certificate must be signed in the presence of a bank official(s) or broker who has the authority to guarantee the signature. The certificate should not be notarized or witnessed by any other person. See sample (ATTACHMENT 1) of the back side of a stock certificate contained within this document.

2. Delivered by mail: The donor should not endorse the certificate. The donor should endorse a stock power or bond power (whichever is applicable) and mail it separately. A bank official or broker must also guarantee the donor's signature on the stock/bond power. See sample (ATTACHMENT 2) of a stock power contained within this document

3. Security certificates received by the Office of Development Accounting should be hand delivered to the Office of Treasury Services for proper processing. Campus mail should not be used.

C. Registration of certificate in the name of Auburn University Foundation.

1. The donor may instruct the transfer agent to issue shares in the name of Auburn University Foundation and deliver the certificate to the Foundation.

2. This method of delivery is not recommended due to frequent delays and poor service on the part of transfer agents.

IV. Date of Gift

    The date of the gift is the date the donor relinquishes control of the securities.

A. The date of gift for securities received by mail for the U. S. Postal Service is the date of the postmark. If a delivery service (e.g., the Postal Service) is not used, the date of gift is the date the Foundation actually receives the securities in negotiable form. The date the donor mails securities to their broker or transfer agent for reissuance to AUF does not constitute the date of gift (see next item C. below).

B. If the securities are transferred (DTC) from the donor's brokerage account to the Foundation's brokerage account, the date of the gift is when the securities arrive in the Foundation's account. The donor should be encouraged to work with their broker to insure the proper and timely transfer of the gift.

C. If the donor has had certificates registered in the name of Auburn University Foundation, the gift is dated as of the date on the reissued certificates. Again, the donor should work with their broker to insure proper and timely registration of the securities.

V. Sales of Securities

A. Securities, as a rule, are sold upon receipt. If there appears to be a potential benefit to the Foundation by delaying the sale, the AUF administration can make such a determination. Donors cannot determine the time to sell securities.

B. Donor's broker should not sell securities from donor's account. Good delivery of securities must be made to AUF, as described in Section III, for the gift to qualify as a charitable contribution.

C. The valuation of the donor's gift will be determined on the date of good delivery to AUF.

D. Delegation of Authority

The Executive Vice President and Treasurer have delegated to the Assistant Treasurer and the Office of Treasury Services the responsibility of processing the receipt and disposition of all donated securities.


Last Updated: August 10, 2017