Secret Agent Man
Confessions of a Stock Transfer Agent
Josh McGinn, CEP, American Stock Transfer & Trust, LLC
Wendy Jennings, CEP, AppDynamics, Inc.
Carrie Kovac, CEP, E*TRADE Financial Corporate Services, Inc.
Disclosure
The information contained in this presentation has been prepared by E*TRADE Financial Corporate Services, Inc., AppDynamics, Inc. and
American Stock Transfer & Trust, LLC, each of whom are responsible for their own content. E*TRADE Financial Corporate Services, Inc. does
not recommend or endorse the product and service offerings of these third parties.
The laws, regulations and rulings addressed by the products, services, and publications offered by E*TRADE Financial Corporate Services,
Inc. and its affiliates are subject to various interpretations and frequent change. E*TRADE Financial Corporate Services, Inc. and its affiliates
do not warrant these products, services, and publications against different interpretations or subsequent changes of laws, regulations and
rulings. E*TRADE Financial Corporate Services, Inc. and its affiliates do not provide legal, accounting or tax advice. Always consult your own
legal, accounting and tax advisors.
The E*TRADE Financial family of companies provides financial services that include trading, investing, banking, and managing employee stock
plans.
Employee stock plan solutions are offered by E*TRADE Financial Corporate Services, Inc.
Securities products and services are offered by E*TRADE Securities LLC, Member FINRA/SIPC.
In connection with the stock plan services it offers, E*TRADE Financial Corporate Services, Inc. utilizes the services of E*TRADE Securities
LLC to administer stock plan participant brokerage accounts.
E*TRADE Financial Corporate Services, Inc. and E*TRADE Securities LLC are separate but affiliated companies.
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2
Secret Codes
FASB
NQ
ASC718
IPO
SEC
x-Date
LT
SDS
S-1
ATOP
IRS
144
FATCA
FINRA
DWAC
ESPP
SDS
TA
STC
3921
DTC
S-8
RSA
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SOX
1099
ISO
701
PTS
W-9
1042
DD
SESO
T+3
SOX
What is a ‘Transfer Agent’?
A transfer agent is a trust company, bank or similar financial
institution assigned by a corporation to maintain records of
investors and account balances and transactions, to cancel and
issue certificates, to process investor mailings and to deal with any
associated problems (i.e. lost or stolen certificates).
Source: http://www.investopedia.com/terms/t/transferagent.asp
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Transfer Agent Main Functions
Issue and cancel certificates to reflect changes in ownership.
For example, when a company declares a stock dividend or stock split, the
transfer agent issues new shares. Transfer agents keep records of who owns a
company’s stocks and bonds and how those stocks and bonds are held—whether
by the owner in certificate form, by the company in book-entry form, or by the
investor’s brokerage firm in street name. They also keep records of how many
shares or bonds each investor owns.
Source: https://www.sec.gov/answers/transferagent.htm
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Transfer Agent Duties
 Record Keeper & Registrar
– Maintain accurate records
 Shareholder (name, address, social security number, shares, cost basis, email
address)
 Foreign holders
 Cap Table (share issuances, transfers, cancellations, treasury stock)
 Abandoned Property/Escheatment
– Lost v. dormant
– Indications of ‘last contact’ v. activity
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Transfer Agent Main Functions
Act as an intermediary for the company.
A transfer agent may also serve as the company’s paying agent to pay out
interest, cash and stock dividends, or other distributions to stock- and
bondholders. In addition, transfer agents act as proxy agent (sending out proxy
materials), exchange agent (exchanging a company’s stock or bonds in a
merger), tender agent (tendering shares in a tender offer), and mailing agent
(mailing the company’s quarterly, annual, and other reports).
Source: https://www.sec.gov/answers/transferagent.htm
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Transfer Agent Duties
 Proxy – Record Dates, Mailings, Tabulations, Solicitations
 Dividends – Payments, Tax Reporting, etc.
 Stock Splits/Spin-offs/Acquisitions
– Due Bills, trading, delivery, vesting (at close)
 Investor Relations reference (link to TA website), FAQ
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Transfer Agent Main Functions
Handle lost, destroyed, or stolen certificates.
Transfer agents help shareholders and bondholders when a stock or bond
certificate has been lost, destroyed, or stolen. Also, if a shareholder holds
securities in his or her own name and wants to transfer or sell them, the
shareholder may need to get their signature "guaranteed" before a transfer agent
will accept the transaction.
Source: https://www.sec.gov/answers/transferagent.htm
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Transfer Agent Duties
 Losses
 DRS, Paperless, Book-Entry & “Certificateless”
 Medallion Guarantees
 Comply with Regulatory Requirements
– Federal, State, Stock Exchange & DTC
 SEC, IRS, Cost basis, UCC, Listing requirements
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Equity Award Processing
 Stock Option Issuances, Employee Stock Purchase Plans,
Restricted Stock Awards
– Process flow
 Exercise (option payment & taxes, stock swaps)
 Issuance (post or delivery – DRS or DWAC)
– Reconciliation of Share Pools (S-8, forfeitures)
– “Gotcha’s”
– Best Practices
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Restrictions
 Restricted Stock
– ‘33 Act/Rule 144, Affiliate/Control/Section 16
– Lock-Up, Unvested, Escrow
– Heathrow Natural Food & Beverage Case
– Opinion Process
 10b5-1 Sale Programs
– Target Population
– Filing
– Execution & Delivery
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Contacts
Joshua McGinn, CEP
SVP, Western Region Relationship Management
American Stock Transfer & Trust, LLC
[email protected]
Wendy Jennings, CEP
Director, Employee Shareholder Services
AppDynamics, Inc.
[email protected]
Carrie Kovac, CEP
Senior Vice President, Relationship Management
E*TRADE Financial Corporate Services, Inc.
[email protected]
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