- Description
- Specifications
The Corporations Act has a special section (Section 708) which allows Private Companies or non-listed Public Companies to raise money from the public without the requirement to issue a prospectus subject to:
(a) Not more than $2M being raised in any 12 month period;
(b) The maximum number of investors in the 12 month period is 20; and
(c) There is no advertising to the public.
Special rules also apply for sophisticated investors who are not included in the limit of 20 investors per annum.
The ability to raise up to $2M per annum by a Private or non-listed Public Company, is an attractive prospect for many companies which wish to expand their business operations.
The 'market' has established 'rules' as to the information to be issued by the companies to raise money from the public other than by issuing a prospectus and these requirements are covered in another paper.
This paper outlines procedure for a Private or non-listed Public Company to raise money from the public without issuing a prospectus under the headings:
- Funding Raising Requirements
- Small Scale Offerings
- Personal Offer
- Breach Of Small Scale Offerings
- Sophisticated Investors
- Combination of 20 Investors and Sophisticated Investor
- Restrictions On Advertising
- Securities Hawking Prohibited
- Offer Information Statement