Prospectus Additional Information

What is a Prospectus

Raising capital, whether through an Initial Public Offering or other avenue presents a company and its shareholders with a number of challenges and significant opportunities.

Expansion, acquisitions and new product development are all reasons why companies look to raise new capital.

Prospectus are issued by companies in order to inform potential investors of an opportunity to either increase or take up a stake in a companies stock or share capital.

They are documents provided to investors on which they will base their decision on whether to invest or not.

Potential Liabilities

Liability can arise in the following circumstances under common law , contract or under various statutes.

  • Misrepresentation or incorrect or inaccurate information contained in the documents such as performance or profit forecasts.
  • Action taken by regulatory authorities in relation to a breach of Securities Legislation its rules, regulations and procedures.
  • Underwriters to an issue may claim for perceived breach of warranties or undertakings contained in the underwriting/placing agreement.
In recent times, New Zealand has seen an alarming increase in the number of allegations and cases involving the raising of capital.

Public scrutiny and changes to Stock Exchange regulations will no doubt focus the attention of companies, their directors and advisors towards the important task of ensuring that their dealings with the investment community are successful.

Prospectus Liability Insurance will negate a substantial part of any downside outcome.

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