Prior to preparing a Regulation D Offering, you need to decide what type of offering you want to include in a private placement program from Commercial Lending Corporation. There are two different types which you might decide to provide to potential private lenders and investors, depending upon the status of your business operations. You could choose to write your Regulation D either for a debt offering, or for an equity offering.
You should understand the differences between these two and what sort of financial obligation it places on your business. A debt offering is one where you sell bonds to private lenders and investors. With bonds, there is often a maturity date and set interest rate. Once the bond matures, you are required to pay the full amount, along with the interest, back to any investors who purchased your bonds.
An equity offering, on the other hand, is where you sell shares of private stock in your company. Shareholders hold a set percentage of ownership in the business based on the amount of shares they purchased. In exchange for their shares, you receive the capital you require. You do have the right to issue dividends to shareholders, like public companies, and give them the right to vote their interest in regards to company business matters. Most companies sell between 5 and 25 percent of their ownership for a first round funding private placement program through Commercial Lending Corporation.
Tagged: Commercial Lending Corporation