If you are a private company and want to offer shares of stock of your company to people interested in investing in it, yet do not want those shares listed on such public exchanges as the NYSE, NASDAQ, or S&P 500, a private company transfer agent can be of great benefit for you. Learn what this type of agent is and how this agent can help facilitate ownership of shares of your private company to them below.
What a Private Company Transfer Agent Does
A private company transfer agent is a third-party financial institution appointed by a private company to act as the main provider of shareholder recordkeeping, keep the stockholder ledger, and record and process any changes to that ledger. Thus, any ownership transfers (commonly referred to as “stock transfers”) are recorded by this agent to help ensure compliance with ownership transfers of shares of a privately held company.
Additionally, this agent will also issue and cancel stock or security certificates, record stock splits for the company, provide general cap table management, and any other required shareholder account maintenance matters.
Why Is Such an Agent Needed
Whenever a company is willing to offer shares of itself to other people, these important maintenance matters must be recorded and documented in a particular way so as to make the transfer legal. Such an agent can ensure this is done properly so as to satisfy Securities Exchange Commission (SEC) requirements, being the agent is experienced in knowing what those requirements are and how to meet them.
In addition, such an agent will also know how to stay in regular communication with shareholders when it comes to such matters as voting rights and answering relevant questions shareholders may have in regards to those shares.
ColonialStock.com provides private company transfer agent and other transfer agent and issuer compliance services to public companies and privately-held companies. Learn more about the services we can provide your company at https://www.colonialstock.com/.
