Category C
Shareholder Stock-Secured Loans
Stock-secured liquidity for founders, officers, directors, and major shareholders, subject to review.
- Principal Capital
- Collateral-Based
- 6–12 Month Terms
- Case by Case
Overview
Stock-secured liquidity for founders, officers, directors, major shareholders, or other holders — subject to transfer-agent, issuer, and securities-law review. Loan-to-value is evaluated case by case based on transferability, trading volume, affiliate status, foreclosure rights, and collateral enforceability.
What Proceeds Cover
- Personal or shareholder liquidity
- Diversification without a disposal
- Follow-on investment in the issuer or elsewhere
- Settlement of a defined personal obligation
- Bridging to a permitted sale window
- Estate or tax planning obligations
When This Applies
Most people arrive here from a search, in the middle of something. These are the situations this category exists to answer.
A holder's wealth is entirely in a position they do not want to sell
Selling changes ownership, signals something to the market, and may not be available at all under a lock-up. Borrowing against the position leaves it in place.
An insider needs liquidity without a disposal
Officers, directors, and control shareholders operate under constraints that ordinary holders do not. A pledge is a different transaction from a sale, and it is reviewed against those constraints rather than around them.
The company itself is not the borrower
These facilities are made to the holder. That keeps the issuer's balance sheet out of the transaction, which is frequently the entire point.
How It Is Structured
The same four things decide whether a transaction in this category can be done, and in what order they are established.
Loan-to-value follows the security, not the borrower
Bands differ by market tier because liquidity and transferability differ. A position on a national exchange and a position quoted on an expert market are not the same collateral, and are not assessed against the same coverage.
Securities-law review comes before terms
Rule 144, Section 16, lock-up agreements, pledge restrictions, transfer-agent requirements, issuer disclosure status, and applicable securities-law constraints are all examined. Affiliate and insider pledges require additional review.
The transfer agent has to be able to do what the documents say
Pledge mechanics a transfer agent will not process are not mechanics. This is confirmed during documentation rather than discovered at enforcement.
Foreclosure rights are documented and enforceable
The value of stock collateral is the ability to realise it. Where that ability is constrained — by restriction, by volume, or by agreement — the coverage required changes accordingly.
Indicative Structure
| Borrower | The holder, not the issuer |
|---|---|
| Term | 6 to 12 months |
| Loan-to-value | By market tier; indicative bands are published below |
| Position | Secured by pledge, subject to transfer-agent mechanics |
| Required review | Rule 144, Section 16, lock-ups, pledge restrictions, issuer disclosure status |
| Conditions | Diligence, legal review, collateral review, definitive documentation, and closing conditions |
All transactions remain subject to diligence, credit or investment approval, legal review, collateral review, and closing conditions.
Collateral Considered
- Free-trading public stock
- Restricted stock, subject to review
- Affiliate or insider holdings, subject to additional review
- Control agreement over a brokerage account
- Supplementary guaranty where coverage requires it
Senior liens, priority, and enforceability are reviewed during diligence.
Model a scenario against this collateralIndicative Loan-to-Value
Loan-to-value is evaluated case by case based on transferability, trading volume, affiliate status, foreclosure rights, and collateral enforceability.
| Collateral Tier | Indicative LTV | Primary Underwriting Focus |
|---|---|---|
| NYSE / Nasdaq | 30% – 50% | Shorter terms, deep liquidity, clean transfer path |
| OTCQX / OTCQB | 20% – 40% | Deeper issuer, dilution, transfer-agent, and filing review |
| Pink | 15% – 30% | Only after diligence supports liquidity and enforceability |
| Restricted / affiliate stock | Case-by-case | Proceed only if foreclosure and transfer mechanics are clean |
Required Review
Every insider or shareholder loan is subject to review of Rule 144, Section 16, lock-up agreements, pledge restrictions, transfer-agent requirements, issuer disclosure status, and applicable securities-law constraints.
Indicative collateral-based range before issuer, transferability, affiliate status, liquidity, foreclosure, transfer-agent, and legal review.
Common Questions
If your question is not here, a short call is usually faster than an email thread.
Ask directlyAm I selling my shares?
No. The position is pledged as collateral and remains yours for the term. What changes is that a lien is recorded against it and the transfer agent is instructed accordingly.
I am an officer of the issuer. Does that rule this out?
No, but it changes the review. Affiliate and insider pledges carry resale restrictions and reporting considerations, and are examined against Rule 144, Section 16, and any lock-up before terms are discussed. Being an insider is a diligence question, not a disqualification.
What loan-to-value should I expect?
It is evaluated case by case against transferability, trading volume, affiliate status, foreclosure rights, and collateral enforceability. The indicative bands by market tier are published on this page, and a scenario can be modelled in the calculator.
Does my company have to agree?
The issuer is not the borrower, but issuer disclosure status and any pledge restriction in a shareholder or lock-up agreement are part of the review, and the transfer agent has to be able to process the pledge. In practice the issuer is usually aware.
What happens if the share price falls during the term?
Coverage requirements and the consequences of a shortfall are set out in the definitive documents for each transaction rather than applied from a standing policy. They are a term to negotiate and understand before closing, not afterwards.
What Happens Next
Submitting a transaction starts a review, not a commitment. This is the sequence that follows.
Submit Intake
Provide a brief overview of your financing needs.
Initial Review
Our team reviews the opportunity and confirms alignment.
Confidential Discussion
We evaluate structure, collateral, and objectives.
Structured Solution
Where there is a fit, we outline a tailored path forward.
Submission of information does not create a commitment to lend or invest.
What to Have ReadyDocuments commonly requested during review. Nothing here is needed to submit.
Corporate
Establishes who you are and who can sign.
- Certificate of incorporation and current bylaws or operating agreement
- Current capitalisation table, including options, warrants, and convertible instruments
- Officers, directors, and holders of more than five per cent
- Board or member authority to incur debt and pledge assets
Financial
Shows what the business does and what it can carry.
- Last two years of financial statements, audited where they exist
- Current-year interim statements
- Existing debt schedule with maturities and security
- Accounts-receivable ageing, where receivables are part of the picture
Transaction
Describes what the money is for and how it comes back.
- Letter of intent, merger agreement, or registration draft, as applicable
- Use of proceeds, itemised
- Repayment or exit source, with its expected timing
- Counsel, auditor, and transfer agent engaged on the transaction
Collateral
Establishes what secures the facility and who else has a claim on it.
- UCC search results and any existing lien or security filings
- Valuation, appraisal, or ageing supporting the collateral's value
- For pledged securities: share certificates or book-entry position, and the transfer agent's requirements
- Any lock-up, pledge restriction, or shareholder agreement that touches the collateral
If This Is Not Quite It
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Submit a Transaction for Preliminary Review
Send company information, requested amount, use of proceeds, repayment source, available collateral, desired closing timeline, and any proposed equity or conversion mechanics.