Registered Direct Offerings

Summary

This practice note provides an overview of registered direct offerings (RDOs), including a brief overview of a typical RDO, the advantages an RDO may offer to issuers, stock exchange approval requirements, and the mechanics of conducting an RDO. An RDO is a public offering of securities to a targeted group of investors with the assistance of a placement agent. An RDO has characteristics of both a public and private offering, and can be an attractive alternative to a traditional firm commitment underwritten public offering (referred to in this practice note as a “traditional public offering”) or a PIPE (private investment in public equity) transaction. An attorney advising a client on an RDO should be familiar with the key documents and procedures used in traditional public offerings (whether initial public offerings (IPOs) or follow-on offerings) and PIPE transactions to fully understand the advantages and disadvantages of each type of offering for a particular issuer.