Do You Have to List Your Marketing Agency on Form D? Item 12 Sales Compensation Explained

Form D does not ask you to list vendors; it asks you to list every person who has been or will be paid a commission or similar compensation in connection with sales of the securities, including finders. Item 12 (Sales Compensation) captures broker-dealers, their registered representatives and anyone else paid on sales, along with their CRD numbers and the states in which they solicit; a marketing agency paid a flat fee that is not tied to sales is generally not the person Item 12 is describing, but whether a specific arrangement falls inside it is a question for issuer counsel.

The question matters more than it looks. Form D is a public filing on EDGAR, state regulators receive the same information through notice filings, and Item 12 is the field that tells every reader who is being paid to sell the round. An Item 12 answer that does not match the actual compensation arrangements can point a regulator straight at a broker-registration problem.

What Form D Item 12 Actually Asks

Form D is the notice of sales that an issuer relying on Rule 504 or Rule 506 must file. Rule 503(a)(1) requires it no later than 15 calendar days after the first sale in the offering, rolling to the next business day if the deadline falls on a weekend or holiday. The form itself is prescribed at 17 CFR 239.500.

Item 12 asks the issuer to identify each person, including any broker-dealer, associated person of a broker-dealer, or finder, who has been or will be paid or given, directly or indirectly, a commission or other similar compensation in connection with sales of securities in the offering. For each recipient the form collects:

• Recipient name and CRD number, or a box indicating the recipient has none.
• Associated broker-dealer name and CRD number, where the recipient is a registered representative.
• Street address of the recipient.
• States of solicitation, either listed individually or checked as "All States."

If nobody is being paid on sales, the issuer marks the item accordingly. A founder-led 506(c) raise with no placement agent and no finders typically reports no sales compensation recipients at all.

The Four Form D Items That Describe Who Gets Paid

Item 12 is one of four places where Form D discloses money flowing to people around the offering.

A common inconsistency is a nonzero commission figure in Item 15 with no corresponding recipient in Item 12, or the reverse.

Does a Marketing Agency Belong in Item 12?

The answer turns on how the agency is paid and what it does, not on what it is called. The table below is a framework for the conversation with counsel, not a determination for any specific engagement.

The underlying statute is Section 15(a) of the Securities Exchange Act of 1934, which generally requires a person effecting securities transactions for the account of others to register as a broker. Compensation based on the size or success of the raise is the factor that most often moves an arrangement into broker territory, which is why capital-raise marketing is conventionally priced as a retainer, a fixed project fee or a fee on managed media spend. Our analysis of success-fee arrangements and broker registration covers that pricing question in depth.

The issuer-side safe harbor runs in parallel. Exchange Act Rule 3a4-1 provides that an associated person of an issuer is not deemed a broker solely by reason of participating in the sale of the issuer's securities if that person is not subject to a statutory disqualification, is not compensated by commissions or other remuneration based directly or indirectly on transactions in securities, is not an associated person of a broker-dealer, and meets one of the rule's activity conditions. A founder who sells the round on salary and a founder who takes a bonus per dollar closed are in very different positions under that rule.

Item 12 and Bad Actor Screening Are Not the Same Population

Issuers sometimes assume that anyone left off Item 12 is also outside the Rule 506(d) bad actor analysis. The wording does not support that assumption. Rule 506(d)(1) lists among its covered persons "any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with such sale of securities." That language is framed around remuneration for solicitation, not around commissions, so issuers commonly ask counsel whether paid solicitation vendors should complete bad actor questionnaires even when they do not appear in Item 12.

For background on the disqualifying events and the look-back periods, see our guide to Rule 506(d) bad actor disqualification.

When Item 12 Changes: Amendment Triggers

Rule 503(a)(3) requires a Form D amendment to correct a material mistake of fact or error, to reflect certain changes in the information provided, and annually if the offering is continuing. For the sales compensation items, the rule draws specific lines:

• No amendment required for a change solely in any address or state of solicitation shown in response to Item 12.
• No amendment required for a decrease in sales commissions, finders' fees, or use of proceeds for payments to executive officers, directors or promoters, or for an increase that, together with all other changes since the last filing, does not exceed 10 percent.
• Amendment required as soon as practicable for other changes in the information provided, which on most readings includes adding a new compensated recipient such as a newly engaged placement agent.
• No amendment required for changes occurring after the offering terminates.

The practical consequence for a marketing team: engaging a broker-dealer mid-raise is a filing event, not only a contract event. Calendar it with counsel before the engagement letter is signed. The full set of filing mechanics is covered in our Form D deadlines and amendments guide.

How Reg CF and Reg A+ Answer the Same Question

Every exemption asks who is being paid to sell. The forms differ in where they put the answer.

The Reg CF promoter rule is the closest analogue to the marketing question in Reg D, and it is stricter in one respect: paid promotion of a Reg CF offering is confined to the platform's channels with per-communication disclosure, or to notices that comply with Rule 204. The detail is in our article on Rule 205 and paid influencers.

A Pre-Filing Checklist for Item 12

1. Inventory every party touching investors. List placement agents, finders, introducers, affiliate partners, influencers, webinar hosts and marketing vendors, with the compensation terms for each.
2. Classify compensation by trigger. Separate fixed fees, media-spend fees and retainers from anything calculated on investments, commitments, closings or investor counts.
3. Escalate every transaction-linked term to counsel. These determine Item 12 entries, Item 15 amounts and the Section 15(a) analysis.
4. Collect CRD numbers early. For each registered recipient, confirm the individual and firm CRD numbers and the states where solicitation will occur.
5. Reconcile Items 12, 15 and 16. Confirm that each dollar in Item 15 has a recipient in Item 12 and that payments to Item 3 persons appear in Item 16.
6. Run bad actor diligence on the broader Rule 506(d) population. Include paid solicitors identified with counsel, not only Item 12 recipients.
7. Set an amendment trigger list. New compensated recipients and commission increases above the 10 percent threshold go on the compliance calendar alongside the annual amendment date.
8. Align marketing contracts with the filing. Scope-of-work language that describes advertising and creative should match what the vendor actually does in the campaign.

Frequently Asked Questions

What is Item 12 on Form D?

Item 12, titled Sales Compensation, identifies each person who has been or will be paid a commission or similar compensation in connection with sales of the securities, including broker-dealers, their associated persons and finders. For each recipient it collects the name, CRD number if any, associated broker-dealer, address and states of solicitation. If no one is compensated on sales, the issuer indicates that on the form.

Do I have to list my marketing agency on Form D?

Form D does not ask for a list of vendors; Item 12 asks for persons paid a commission or similar compensation in connection with sales. An agency paid a fixed retainer for advertising and creative that is not tied to investments is generally not the recipient Item 12 describes. A fee or bonus linked to capital raised changes that analysis and also raises broker-registration questions, so issuers typically review those terms with securities counsel before filing.

Do finders have to be disclosed on Form D?

Item 12 expressly extends to finders who are paid, directly or indirectly, a commission or similar compensation in connection with sales, and Item 15 reports the dollar amount of finders' fees. Disclosure does not resolve the separate question of whether an unregistered finder's activity requires broker-dealer registration under Section 15(a) of the Exchange Act. Issuers commonly treat the two questions together with counsel.

Is adding a placement agent mid-raise a Form D amendment event?

Rule 503(a)(3) requires an amendment as soon as practicable to reflect changes in the information provided, subject to listed exceptions. The exceptions cover changes solely in an Item 12 recipient's address or states of solicitation and commission increases of 10 percent or less in aggregate, not the addition of a new compensated recipient. Issuers typically confirm the timing of the amendment with counsel when the engagement is signed.

Is everyone left off Item 12 outside the bad actor rules?

Not necessarily. Rule 506(d)(1) covers any person that has been or will be paid, directly or indirectly, remuneration for solicitation of purchasers, which is framed more broadly than commission-based compensation. Issuers commonly ask counsel whether paid solicitation vendors should complete bad actor questionnaires even when those vendors do not appear in Item 12.

Keep the Filing and the Funding Plan Consistent

Item 12 is where a raise's distribution plan becomes public record, and it should describe the same arrangements the marketing plan actually uses. Growth Turbine has provided marketing support across more than $490M in aggregate issuer-reported totals and 210+ fundraising campaigns managed supported across Reg CF, Reg D 506(c), Reg A+, and tokenized securities offerings, across 23+ crowdfunding platforms and 25+ industries. Growth Turbine provides marketing services only; it is not a broker-dealer or law firm, and it works alongside the issuer's counsel and any broker-dealer of record rather than in place of them.

Planning a Rule 506(c) raise? Our Reg D 506(c) marketing services cover accredited-investor targeting, compliant landing pages and verification-ready funnels. For programs spanning more than one exemption, see our equity crowdfunding marketing agency overview, then contact our team to scope the campaign.

Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute legal, financial, or investment advice. Always consult with qualified legal counsel and financial advisors before launching a capital raise.