Courtesy referrals
Transfer agents and accreditation services
Two kinds of service a company may need for its offering. Sprowtt provides neither. The names below are courtesy referrals, nothing more.
Sprowtt is not a stock transfer agent and is not an accredited-investor verification service. The services listed here are courtesy referrals only. Sprowtt has no ownership in, partnership with, or referral arrangement with any of them, and receives no referral fee, compensation or other benefit from them. The company or investor that uses a service chooses it, contracts with it and pays it directly. A listing is not an endorsement.
What a transfer agent does
- Keeps the company's official list of shareholders.
- Issues shares and records them.
- Handles transfers of shares from one holder to another.
A company can keep its own cap table in Sprowtt and export it for a transfer agent to take over. Sprowtt itself issues, transfers and cancels nothing.
When one is required
- Regulation Crowdfunding
- Investors who bought in a Regulation Crowdfunding offering are left out of the count that can require a company to register with the SEC only if, among other conditions, the company "has engaged a transfer agent registered pursuant to Section 17A(c) of the Act" (17 CFR 240.12g-6(a)(3)). A Regulation Crowdfunding offering does not run on this website: it must be conducted through a registered broker-dealer or a registered funding portal. More on Regulation Crowdfunding
- Regulation A, Tier 2
- The same condition applies (17 CFR 240.12g5-1(a)(7)(iii)).
- Rule 506(b) and Rule 506(c)
- Ask your counsel whether your offering needs one.
Transfer agents
ClearTrust, LLC
www.cleartrustonline.com813-235-4490 · Lutz, Florida
Says on its website it is SEC registered. Prices on request.
Before you sign with a transfer agent
Questions to ask any transfer agent, and to have answered in writing, before you sign. Your counsel can help you read the agreement.
- What is the exit or termination fee, and how, and how quickly, are the shareholder records handed over if you leave?
- How long is the initial term, and does the agreement renew automatically? How much notice ends it?
- Will the agent hold back the records until every invoice is paid?
- Are any fees charged per share class?
- May the agent use your shareholders' information for its own marketing?
- Does the agent pay finder's fees to anyone who refers companies to it?
- Does the agent run, or is it affiliated with, an offering platform, a broker-dealer or a funding portal?
- Is the agent registered with the SEC as a transfer agent? Ask for its registration, and check it on the SEC's EDGAR website.
Accredited-investor verification
In a Rule 506(c) offering every buyer must be an accredited investor, and the company must take reasonable steps to verify it. An investor can use a verification service or a letter from their own attorney or CPA; the company decides whether to accept it.
InvestReady
www.investready.comVerify on InvestReady's own website, then upload the letter it gives you.
Verify Investor
www.verifyinvestor.comVerify on Verify Investor's own website, then upload the letter it gives you.
Not sure whether you qualify? Am I an accredited investor? is a short self-check. It is education only and is not a verification.
Sprowtt is not a stock transfer agent and is not an accredited-investor verification service. The services listed here are courtesy referrals only. Sprowtt has no ownership in, partnership with, or referral arrangement with any of them, and receives no referral fee, compensation or other benefit from them. The company or investor that uses a service chooses it, contracts with it and pays it directly. A listing is not an endorsement.