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Private Capital

Private placements of debt or equity involve selling company securities to accredited investors and not the public at-large. Since the securities are sold to professional investors, the Securities & Exchange Commission does not require the issuer to file extensive documentation required for public offerings. Wedbush Morgan acts as an agent for the issuing company assisting management with drafting a marketing document, presenting the company in the best possible manner and arranging meetings between management and investors active in the private equity or debt market. In addition, Wedbush Morgan bankers assist in the negotiation of financial terms to assure our clients receive the cheapest capital available under the most favorable conditions. In special situations Wedbush Morgan will also participate in the placement through a related, private-equity fund.
Typical Private Placement Timeline
ADVANTAGES:
	Provides the Company with equity capital while giving up less control than an outright sale. • Limits exposure to the volatility of the public financial markets. • Provides the Company with experienced investors who can assist in strategic management decisions. • May increase the Company's credibility with suppliers, customers and other financing sources. • Maintains confidentiality of business operations and strategies.
DISADVANTAGES:
	Limited liquidity for existing investors. • Generally provides lower valuation than the public markets. • Preferred stock increase leverage risk for common shareholders. • Existence of certain restrictive financing covenants. • Investors will generally seek representation on the Board of Directors. • Sub-S tax filing status may not be applicable.

System response times may vary due to a variety of factors, including trading volumes, market conditions, and system performance.
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