PROSPECTS – EDUCATIONAL CLINIC MALTA - PowerPoint Presentation

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PROSPECTS – EDUCATIONAL CLINIC MALTAIn collaboration with DEMETRA CORPORATE ADVISORSFriday, 10 June 2016Slide2

WHAT IS PROSPECTS?

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Prospects

is a Multilateral Trading Facility (MTF) operated by the MSE which is a new market intended to facilitate access to capital for

SMEs and

S

tart-upsSlide3

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Key Features :

MTF Structure

Admission granted by MSE

MiFID Compliant

No minimum IPO size

Flexibility of issues shares or bonds

Not pass-portable

Require s a Corporate Advisor

Requires a Business PlanSlide4

THE RULES

The Rules provide for the creation of structures that will ensure a stable future for admitted companies

The Rules provide for succession and continued growth and governance and corporate structure that create and effective management environment

The Rules provide

standardisation

of Application and Disclosure Documentation

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THE RULES

Interpretation

General

Corporate Advisors

CompaniesObligations of Securities’ Holders in Equity SecuritiesCircularsTakeovers

Appendices (Templates)

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THE RULES

Chapter 2 – General :

Prospects & Rules

Applicability

– Applicant Companies will be ineligible if they satisfy the requirements of the Listing Rules (Prospectus Directive)Retention of Documentation

Prospects Committee

Discipline & Sanctions –

disclosure, fines, suspension, cancellation of Admission

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THE RULESChapter 2 – General :

Continuing application of the Rules

Fees –

Appendix 2.1

Risk Factors & DisclaimersAdvertisements

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THE RULES

Chapter 3 – Corporate Advisors :

An applicant company is required to appoint and retain a Corporate Advisor to gain and maintain admission to Prospects

Approved by the Prospects Admissions Committee within one (1) week of end of Notification Period (2 weeks from receipt of all relevant application documents)

Admission as Corporate Advisor effective as from date of issue of relevant Prospects NoticeSlide9

THE RULES

Minimum Admission Requirements :

Be either an individual or a legal person established in Malta or any

recognised

jurisdictionEmploy, directly contract or in-source at least two designated qualified persons who shall demonstrate proven experience in corporate finance, corporate governance, accounting and management consultancy

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THE RULES

A Corporate Advisor shall :

Be independent and impartial from client companies

Have in place procedures to prevent and detect conflicts of interest

Assess the on-going appropriateness of an applicant company to be admitted and remain admitted

Ensure disclosure of all material information related to a company at admission and on an on-going basis

Objectively assess whether it has the capacity to prove the necessary advice, guidance and training to its clients at admission and on an on-going basisSlide11

THE RULES

A Corporate Advisor shall :

Manage and co-ordinate other advisors at admission and on an on-going basis

Present relevant information in a consistent, complete and accurate manner

Deal with the Exchange professionally and promptlySlide12

THE RULES

In addition to the general responsibilities described, before signing and submitting an application for admission, a Corporate Advisor shall:

Ensure that the Directors of the applicant company can be relied upon to prepare and publish all relevant information

Have explained to the Directors the nature of their responsibilities and obligations

Have obtained confirmation from the Directors that the company has established provides enabling them to make complete and accurate disclosures as required by the Rules

Complete all admission documents as required under these RulesSlide13

THE RULES

Continuing Obligations:

Promptly advise the MSE of any material change that may impact its ability to comply with its responsibilities

Continually assess whether it retains the capacity to meet its responsibilities

Maintain a services agreement with each client company for the period during which it serves as Corporate Advisor (Appendix 4.17)

Independently advise, support and update each client on its continuing obligations under these RulesSlide14

THE RULESThe path to Investor Protection:

The CA :

Lead Advisor for Admission

Retained post-admission

Co-ordinates other advisors

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Specialised

skills are essential for investor protection – may be in-house or outsourcedSlide15

THE RULESApplication Process :

Formal Application for Admission –

Appendix 3.1

Check List -

cross-referencing to Rules and Documents RequiredProspects Committee will meet with Applicant – where appropriate will meet with members of the corporate advisory team leading on legal and accounting matters

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THE RULESChapter 4 – Companies :

Eligible securities :

Equity, or

Corporate Bonds (including callable bonds)

Companies may come to market without having an IPO

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THE RULES

An applicant company must :

Be an SME or start-up

Have issued and fully paid up share capital of Euro 46,588

Ensure that its M & A or equivalent constitution document satisfies the relevant requirements as outlined in Rule 4.01.01

Upon reasonable assumptions at the date of application be expected to be financially solvent for at least 12 months from the time of admission

Appoint and retain a Corporate Advisor

Provide complete and accurate information during admission process and on an on-going basis

Maintain a website containing at least the same company specific information required to be disclosed under the Rules

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THE RULES

Other

R

ules relate to :

Corporate GovernanceRelated party transactions

Lock-in of Substantial Shareholders

Dealing restrictions

Continuing Obligations

Voluntary suspension or termination

Property Companies

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THE RULESChapter 6 – Circulars :

Circulars which must be approved by the MSE shall be issued by the Issuer in respect of amongst others :

Allotment of securities and increase in share capital

Capitalisation

, bonus, scrip dividend

Redemption of debt securities

Amendments to M & A

Related party transactions

Share schemes

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THE RULESProspects securities will be available for trading on the MSE’s secondary market in accordance with the MSE’s Trading Rules as contained in Chapter 4 and Appendices of its Bye-laws

Prospects Securities held within the MSE’s CSD will be cleared, settled and registered in accordance with the relevant procedures as set out in Chapters 6 and 7 and Appendices of the MSE’s Bye-laws

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THE RULES

Admission time-frames :

One month prior to submitting application, MSE to be notified of such application

Approval by Prospects Committee within 10 days of fully compliant application

Admission becomes effective upon issue of relevant Prospects Notice

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THE RULES

Appendix 4.1 – Documentation required with application for Admission

Appendix 4.2 – Formal Application for Admission of Financial Instruments to Prospects

Appendix 4.5 – Company Admission Document Template

Appendix 4.6 – Accountant’s Report Template

Appendix 4.7 – Financial Sustainability Forecasts

Appendix 2.1 - Fees

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