Securities Transfer Agents

Transfer agents track the owners of securities. They also perform several other services for companies with registered and publicly traded securities in the course of tracking the owners of the securities. Transfer agents usually are banks or trust companies, although a company with publicly traded securities may perform transfer agent functions for its own securities. Functions of transfer agents include:

• Tracking company ownership -- Transfer agents issue certificates evidencing securities of a company and cancel those certificates if the underlying ownership is transferred to another person or entity. Transfer agents track ownership of the securities by keeping records of what certificates have been issued or transferred and what securities are held in street name by a brokerage or in book-entry form by the company.
  
• Determining loss or destruction of certificates of ownership of company securities and replacing those certificates upon receipt of a guaranteed signature of the true owner of the securities.
  
• Serving as company intermediaries -- Transfer agents may be a company's paying agent responsible for distribution of dividends and interest payments to stockholders and bondholders of a company. Transfer agents also may serve in the following additional agency capacities:

• Proxy agents responsible for sending out proxy materials and reporting results;
• Exchange agents that in a merger are responsible for exchanging stocks or bonds;
• Tender agents that tender shares in response to a tender offer; and
• Mailing agents responsible for mailing out annual reports and other communications to owners of company securities.

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