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Summary
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 Hybrid
structure enables an issuer to achieve the speed of
a Rule 144A offering but with the pricing of a fully-registered
offering
- As a first step,
issuer privately places debt securities - often
under Rule 144A
- Issuer undertakes
to register identical securities with
the SEC
- Then, in a subsequent
transaction, issuer exchanges the freely-tradeable
registered securities for the privately-placed restricted
securities
- Typically the interest
rate on the privately-placed securities will increase
if the issuer doesn't complete the exchange by an
agreed-upon date
A
creation of a series of SEC no-action letters
- Starting with the
Exxon Capital letter 1988
- Thus, sometimes called
Exxon Capital exchanges
Used
in about 70% of high yield debt offerings
- Expect fewer deals
will be done as A/B exchanges
- As WKSIs will be
able to use automatic shelf registration
- See
Securities Offering Reform
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SEC No-action Letters
Precedent Deals
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M&A
Related
-
Hertz Private Equity
Sponsored
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SunGard Data Systems
PrivateEquity Sponsored
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Neiman Marcus Private
Equity Sponsored
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DaVita
-
UGS Corp Private Equity
Sponsored
Convertible
debt
Noteworthy
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SEC Comment Letters
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Re:
reliance on no-action letters
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Related Topics
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