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- Capital Structure Analysis In Private Transactions
In this second part of the series we'll look at the first of the three pillars - capital structure. Capital structure refers to how a business finances its operations and growth. At its simplest level capital structure consists of debt and equity. The components of capital structure that I'll discuss below are: Leverage; Loan-to-Value; Liquidity; Inter-Creditor Relationships; and Bankruptcy Considerations.
- Three Pillars For Evaluating A Transaction
Commitment size and required IRR - the two decision points that define the decision to pursue a transaction. However, before deciding whether to pursue a transaction, a thorough evaluation needs to take place. But what do you look at? What needs to be considered?
- How To Not Leave Money On The Table When Raising Equity
If you are out raising equity, you need to do some simple math to make sure you are not leaving money on the table. In this article you'll find the six easy steps to price your private equity offering on the back of an envelope.
- Accredited Investor
Under rules 505 and 506 of Regulation D of Securities Act of 1933, an "accredited investor" is a defined term that describes who is eligible to invest in securities which have not been registered with the SEC.
- Using Warrants In Your Private Offering
If you are raising debt or equity you will need to incorporate warrants in your deal structure. This article provides some of the backdrop and definitions you'll need to know as you put your PPM nd term sheet together.
- Why A PPM?
There are two major reasons for preparing a Private Placement Memorandum. First is to give you cover against securities fraud claims. By writing and delivering a PPM, you are establishing a record of what has been communicated to the investors about the offering and the company.
- Contents Of A PPM
Now that you have made the decision to use a, what goes in it? The main concern of State and Federal securities laws are the protection of the investor. In this context, there is one cardinal rule – tell the truth, the whole truth and nothing but the truth.
- Regulation D
Reg D provides companies an exemption undet the Securities Act of 1933 to permit the issuance of securities which have not been registered with the SEC.
- Rule 504
Criteria and circumstances under which companies may sell securities pursuant to Rule 504 of Reg D of the Securites Act of 1933.
- Rule 505
Criteria and circumstances under which companies may sell securities pursuant to Rule 505 of Reg D of the Securites Act of 1933.
- Rule 506
Criteria and circumstances under which companies may sell securities pursuant to Rule 506 of Reg D of the Securites Act of 1933.
- Warrants
A Warrant, also called a Stock Warrant, is a certificate that entitles the holder (the person to whom the Warrant is issued) to purchase a certain number of shares of common stock, at a stated price, for a specified period of time.
- C Corp
The C corporation is a standard corporation, and is a very common business structure. The primary advantage of incorporating a business is the limited liability the corporate entity affords its shareholders.
- LLC
The LLC is a distinct business entity that combines the corporate advantage of limited liability protection with "pass-through" taxation, the method of taxation afforded to both general partnerships and S corporations.
