Series 79 Days

pool activitiy

//matched orders, involves a group formed for the purpose of acting in collusion to manipualte prices

Where find information on largest shareholders of SEC reporting company?

1) 13-D: best 2) 10-k 3) proxy

steps in M&A process

1) creation of the teaser 2) deliver a confidential information memorandum 3) setting up data room 4)letter of intent 5) closing the deal

EV calculations

1) equity value + total debt + preferred stock + minority interest - cash and cash equivalents 2) equity value + total debt + preferred stock + noncontrolling interest - cash and cash equivalents

Advantages of Regulation A offerings

1) financial statements simpler 2) no Exchange Act reporting olblications after offering unless company has over $10MM in total assets and more thn 10,000 shareholders 3) reduces expenses of filing with SEC Securities offerings can be offered publicly and are not restricted (oe can be freely traded in the secondary market)

Quiet period for comanager publication of research reprt for nonactive traded registered secondary offering is

10 days

Stale financial statements for WKSI

130 days

Stale financial statements for regular filer

135 days

restricion for other underwriters and selling group period of quiet period

25 days following the date of the offering

restriction for IPO of quiet period is

40 calendar days following the date of offering for manager + comanager

When stabilizing a bid what must happen?

Electronic notices of the intention to stabilize must be submmited to the FINRA Market Regulations Department or FINRA's corporate financing department. Intention to stabilize must be noted in the SEC registration filing, and once it happens a bid must be identified as such and existance of any penalty bid must be disclosed to all distribution participants.

interest coverage ratio

Interest coverage ratio = EBIT/ interest expense

bond trading at discount

Nominal Yield < Current Yield < YTM

Changes to balance sheet: A/P rise

Source of Cash

Changes to balance sheet: A/P falls

Use of cash

Changes to balance sheet: A/R rises

Use of cash

Schedule 13D

When a person, or group of persons, aquires ownerhship of more than 5% of a company's equity. Issuer does not need to file if repurchasing own securities

bond trading at a premium

YTM > Current Yield > Nominal Yield

During period of a tender offer a covered person may purchase which securities?

a covered person (ie issuer or individual making TO) w/ IB acting as dealer may purchase nonconvertible bonds of the issuer

Graphic communication

any form of electonric media, including audio and videotapes, CD-ROM, facsimilies, websites and voice meesages, as well as anything distributed via comupter

Rule 425

any written communication made in connection with, or relating to, the transaction must be filed with the SEC

SEC Rule 145

applies to situations where securities are offered as a result of business combinations due to mergers, acquisionts consolidations, reclassifications of securities or trasnfers of corporate assets. stock splits, stock dividindes and resulting changes in par value are specifically exmpeted from filing under rule 145. a private equity company, or any company that is filing for an IPO to become publicly traded would most liekly file an S-1 registration statement not 145

New Issue Rule

firm must obtain representation from an account holder or any authorizied part stating that the acount is elifible to pushcase new issues. The representaiton form the account holder may be in the form of an affirmative statement and may use electronic communication to verify account eligibility for new issuers, but may not rely oral statements. A member firm that sells new issues must reverify elibility every 12 months and must retain copies of all information and records used in verification for a minimum of at least three years.

From D

for Private placements, the issuer required to file Form D with the SEC no later than 15 days after the first sale of securities.

Regulation A

for excemption from registration for public offerings. offering cannot exceed $5MM in any one year period. Shareholders can sell up to $1.5MM of securities. Any sale by existing shareholders counts against $5MM total.

"as soon as practical"

if file tender offer and become owner of more than 5% of shares

matched orders

involve two persons acting in collusion to manipulate prices

SEC rule 135: on notices

issuer permitted to publish a note that contrains only limted information. such notices are not required to be filed with the SEC. the notice must have a legend explaining that id does not contain an offer to sell securities. this rule applies when securities are offered as a result of business combiantions due to mergers, acquisitions, consolidations, reclassifications of securities or transefer or corporate assets.

Rule 105 of Regulation M

it is a violation for any person to sell short the security tha is the subject of an offering and to purhcase an offered security from an underwriter if the short sale was executed during the period beginning five business days prior to the pricing of the offering and ending with the pricing of the issue. If the pricing of the offering occurs within five business days of the filing of registration statement, then rule 105 applies. no exemption exists for block-seize orders or institutional orders.

investors of Growth at a Reasonable Price (GARP)

low P/E ratios, low P/E to growth ratios and low price to book ratios1

20 business days

minimimum open tender offer period

follow up offer in TO

must be opened for an additional 10 business days for when a person making a TO increases or decreases the percentage of the class of securities being soutgh, the consideration being offered or the dealers soliciting fee

w/in 10 days

need to file form 13D after acuqiring more than 5%

EBITDA : GAAP or not GAAP?

not GAAP

painting the tape

occurs when manipulative transactions are reported to the consolidated tape and impact transaction decisions of other investors

risk unique to mortgage backed securities

prepayment risk

wash sales

price manipulation activities that involve the purchase and sale of securities by an individual without beneficial change of ownership, for sole purpose of raising and lowering the price of the security

If bank of america participating in distribution of public offering of its own securities:

qualified independent underwriter must participate in prep of offering documents and conflicts of interest must be disclosed in prospectuis. a QIU must serve as manager or comanager in at least three previous public offerings of a similiar sixe and type during the 3 year period preceding filing of registration statement

20 business days

registration statement becomes effective the 20th business day after filing

trust indenture act of 1939

relates to the issuance of corporate debt instruments. requires trustee to be appointed to act in the bondholder's interest

Rule 144

restricted (ie unregistered) stock must be held for 6 months before it can be resold. Control (ie insider) stock is not subject to holding period restricted + control stock are subject to volume limitations

nominal yield

same as coupon yield

at the market offering

securities sold at the prevailing market price directly into the secondary market through a designated broker dealer. issuers can use shelf registration to initate an at the market offering, where securites are sold at various prices during the day, reflecting supply/ demand profle or that issuer

Changes to balance sheet: A/R falls

source of cash

Changes to balance sheet: inventory falls

source of cash

Nasdaq Global Select

the most stringent requirements includig: public float, stockholder's equity, bid price, revenue, number of market makers, number of shareholders and cash flow from operations NOT EPS

Regulation A documents: when given to investors?

the offering circular must be furnished to investors at least 48 hours prior to the mailing of a confirmation of sale.

Direct participation programs (for limited partnerships)

the sponsor or general partner must agree to pay all the expenses associated with the solicitation of the investors in a roll-up transaction. Broker dealer soliciting the approvals from limited partners in connection with a rollup is limited to compensation of 3% of the value of the newly created securites. the amount of compensation may not be dependent on the number of investors who agree to transaction

Regulation A filing documents

to claim the excemption companies must file an offering statement with notification, offering circular and exhibits.

Restricted Period Notification Form

underwriting manager must submit to FINRA's Market Regulations department no later than day prior to commencement of restricted period. To show whether distribution participants will be excused, or designated as passive market makers

Changes to balance sheet: inventory rises

use of cash

pegging or price fixing

when prices are artificially maintained at a certain level by manipulative activity or conspiracy

Rule 165

written communications are permitted once there is a public announcement of a business combination (M&a, exchange or reclassification) if securities to be issued are required to be registered with the SEC, ~ form S-4.