Debt securities—what is the role of the underwriters/managers?
Produced in partnership with Charles Farnsworth of Baker McKenzie

The following Banking & Finance practice note produced in partnership with Charles Farnsworth of Baker McKenzie provides comprehensive and up to date legal information covering:

  • Debt securities—what is the role of the underwriters/managers?
  • What is underwriting and why are securities issuances typically underwritten?
  • What is a manager's role and responsibilities?
  • What are the key transaction documents to which a manager is a party in an offering of debt securities?
  • Mandate letter
  • Invitation telex
  • Allotment telex and agreement among managers
  • Subscription agreement
  • What risks does a manager face in a debt securities offering?
  • Liabilities and duties
  • More...

Debt securities—what is the role of the underwriters/managers?

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marks the end of the Brexit transition/implementation period entered into following the UK’s withdrawal from the EU. At this point in time (referred to in UK law as ‘IP completion day’), key transitional arrangements come to an end and significant changes begin to take effect across the UK’s legal regime. This document contains guidance on subjects impacted by these changes. Before continuing your research, see Practice Note: What does IP completion day mean for DCM lawyers?

What is underwriting and why are securities issuances typically underwritten?

The term ‘underwriting’ refers to a commitment to subscribe for or purchase securities that are not able to be sold to investors or to be paid for by investors in a securities offering. By making such a commitment, an underwriter assumes the risk from the issuer that the securities being offered will not be taken up by investors. The underwriter, therefore, effectively guarantees the issuer, subject to certain conditions, the number of securities that will be sold and the amount of proceeds the issuer will receive.

The entities acting as underwriters on a securities offering are usually investment banks. These investment banks are also often referred to as managers, bookrunners or initial purchasers, depending on the specific roles that they undertake in a particular transaction,

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