Mechanics of Distribution and Placement Agents: Rapid Fire

What this video covers

• Which of the five distribution methods place agent risk on the placement agent (firm commitment, standby) versus issuer risk on the sponsor (best efforts, all-or-none, mini-max)
• How the two-step mini-max trigger differs from the single all-or-none trigger, and why the offering documents control timing rather than any federal day-count rule
• Why an indication of interest is non-binding until a subscription agreement is executed and accepted, and how private pricing is negotiated with the issuer instead of discovered through public bookbuilding
• The three components of the spread (dealer manager fee, selling group commission, warrants or stock) and why selling group obligations run to the dealer manager, not the issuer
• The three baseline conditions plus one of three participation paths that an issuer's associated person must satisfy to sell without registering, and why the once-every-12-months cap applies only to the incidental-duties path
• The two unranked vehicles for contingency money (separate bank account with broker-dealer as agent or trustee, written bank escrow) and the blanket exemption from payment-handling rules for firm commitment offerings
• Why the safe harbor never reaches an outside finder, and the ordinary broker-dealer conduct standards that continue to apply in private offerings