Rule 144A

Rule 144A

What Prospectus Can Do

Prospectus’s team specializes in 144A offering. Rule 144A is one of the most utilized rules in the debt securities markets when it comes to raising capital, and indeed it is a nearly trillion-dollar yearly market for capital raising.

What is Rule 144A

Rule 144A provides a safe harbor from registration and the requirements of such registration under the securities Act of 1933. Adopted pursuant to the U.S. Securities Act of 1933, as amended (the “Securities Act”, Rule 144A can only be implemented if the sale or resales of securities are sold to QIBs, or Qualified Intuitional Buyers. These QIBs are normally institutional investors with a net worth or $100 million investable assets. 144A securities can only be sold to US persons.

When underwriters or investment banks begin to sell securities under Rule 144A it is mandatory that they approach and only complete a transaction with a qualified institutional buyer – the QIBs. The main mechanism used to raise 144A capital is the prospectus, or the offering memorandum or private placement memorandum. These documents are used worldwide to sell 144A securities, and must be submitted to depository such as Euroclear and Clearstream, and the Depository Trust Corporation (DTC) for clearing and settlement purposes, particularly for debt issuance.

What We Do

Our team of Rule 144A consultants – bot for debt and for equity – assists US or foreign company’s Rule 144A offering guidance, including:

  1. team undertakes the initial analysis to check your company’s business model and/or the securities to be issued to ensure that Rule 144A can be complied with. or securities qualify for a Rule 144A Offering. Ahead of the issuance of the 144A securities, an issuer one must know whether the securities will qualify. Our team will do an analysis on the issuers qualifications and give our opinion regarding Rule 144A. This free consultation saves needed time and capital during the 144A process.
  2. To assist in the successful offering of our clients, Prospectus’s team conducts all necessary effort in order to achieve Rule 144A status and allow for a 144A offering to transpire. This includes the writing of the 144A offering memorandum or 144A prospectus, as well as supporting documentation such as the subscription agreements or trust indenture, securities identification number obtaining like the international securities identification code or a SEDOL code from the United Kingdom (like the CUSIP number from the US) and more.

144A Bond Offerings

Prospectus’ helps companies with 144A bond offerings. 144A bonds or 144A notes consists of many aspects, but the single most important document is the prospectus or the offering memorandum. The prospectus will outline the terms of what the issuer is offering, including the dollar or other currency denominations, the interest rate, maturity date, payment dates, legal and financial information, risk factors, and much more, including the subscription agreement. 144A bond offerings are often conducted with the Regulation S or Reg S rules in place, which allows for the sale of securities to non-US investors, unlike Rule 144A which allows for the sale and resale of 144A securities to US persons only. The 144A bond market consists of nearly 99% of all 144A transactions, with the remains 1% being equity offerings. The 144A market is nearly a trillion-dollar market.  Often times, the issue will create an offering memorandum and offer the bonds, via private offering, through the Prospectus, as opposed to a public bond offering. Prospectus can assist in all of your 144A bond requirements.

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Rule 144A

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Rule 144A

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