► Structured Solutions for Publicly Traded Companies    

If you are managing a small to medium size Public Company, there are several ways to receive additional cash without having to do a secondary offering or a private placement.

Investments are being made in all sectors, industries, countries and exchanges:

  • Purchases of Invoices owed by publicly traded companies to third party creditors including, their attorneys, accountants, landlords, suppliers, vendors, consultants, marketers, bankers or any other third parties.
  • Debt Restructuring and Consolidation.
  • Convertible Promissory Notes
  • Purchases of Stock through a S-1, Regulation A, or Registered Direct Offering
  • Acquisition Financing
  • Purchases of large blocks of stock

This kind of Facility usually allows your company:

  • The right, but not the obligation, to sell shares of equity in tranches over a defined commitment period.
  • To raise capital by selling shares as needed or when market conditions are favorable.
  • To negotiate a floor below which stock cannot be sold, providing a safety net during a downturn.
  • To receive our contract to buy shares under the agreement regardless of the economic environment and your company’s circumstances. Benefits:
  • The flexibility to raise funds in incremental amounts
  • To increase your company’s shareholder base in a controlled and measured way
  • Both the fixed and variable costs associated with entering into a Facility tend to be lower than those associated with other means of capital raising
  • Fewer restrictions on the issuer
  • Fast access to capital

The major factors that are considered when putting an Equity Enhancement Facility in place include:

  • The total amount of equity the investor commits to purchase;
  • Parameters of Facility usage including the maximum size of each advance or tranche;
  • Purchase price determinations, including any floor price; and
  • Costs

 Advantages. The success of the Facility as a capital alternative equity financing tool can be attributed to the benefits it offers over other means of capital raising. Some advantageous features of the Facility are described below:

Flexible size and timing of cash advances:

  • Flexibility
  • Access to capital throughout the duration of the Facility
  • Low implementation costs

 Fewer Restraints. Generally the Facility imposes fewer restrictions on an issuer. The Facility does not generally restrict how the issuer uses proceeds, impose leverage ratios or require the issuer to maintain certain cash levels and will not require an issuer to reach revenue or similar targets.

 Conclusion. The Facility is a simple, flexible, and effective alternative equity financing tool that serves as a method for public companies to opportunistically raise capital from the equity markets. If properly structured and used with regard to current market conditions, the Facility is an inexpensive, non-restrictive way to raise capital without incurring excessive dilution. As such, the Facility is well suited to enhance and manage liquidity while ensuring a guaranteed source of funding regardless of market conditions.