3.  Statutory declarations on disclosures  Use of proceeds  Independence of Note Trustee  Management Commentary  Signed agreements between issuer and transaction advisers/agents

4.  One of the key objectives of the Authority is investor protection. (Sec. 11(1) (d) of the Capital Markets Act.  Sec. 13(1)- Power of the Authority to request for any additional information that it may deem necessary to ensure that investors have access to information that would enable them make an informed decision in relation to a public offer of securities.

5.  A representation made that:  when made, the representation was known to be false or made recklessly without knowledge of its truth;  is made with the intention that investors rely on it;  investors rely on and suffer damages as a result

6.  Sec. 30D (1)- A person who makes a false, misleading or deceptive statement in a prospectus; or omits information or a statement from a prospectus which is required under this Act to be included commits an offence and shall be liable on conviction;  Individual- a fine not exceeding 10 million shillings or to imprisonment for a term not exceeding seven years or to both; and  Company -a fine not exceeding 30 million shillings. 

7.  Sec. 30 E (2). – Where the Issuer is a corporate, the directors of the Issuer at the time when the Prospectus is published and each person who accepts and is stated in the Prospectus or supplementary prospectus as accepting responsibility for or for any part of the prospectus or supplementary prospectus is jointly and severally responsible to pay compensation to any person who suffers a loss on relying on the false information including those who buy the securities in the secondary market on reliance on the false prospectus.

8.  Section 30D (1) of the Capital Markets Act requires directors of the Issuer to bear the responsibility for the disclosures contained in the disclosure documentation.  A statutory declaration by the directors and company secretary of the issuer on the accuracy of the information availed in the Information Memorandum relating to the: ◦ company’s financial position ◦ operations and future prospects ◦ a confirmation that in the event that the said information changes, based on the prevailing circumstances of the company, a supplemental disclosure document shall be submitted to the Authority for approval

9.  A statutory declaration from the CFOs who prepare the financial statements to confirm that the financial statements are true and fair to the best of their knowledge.  This is to ensure that the CFOs take responsibility for the contents of the financial statements and eliminate the defense that they may not have been aware of financial misstatements therein.

10.  A statutory declaration from the external auditor of the issuer confirming: That they were the auditors of the firm for the period That they were independent That based on their review procedure conducted, nothing came to their attention to indicate that the financial statements were not true and fair.  This will ensure that other independent parties other than the CFOs take responsibility for the contents of the financial statements and eliminate the defense that they may not have been aware of financial misstatements therein

11.  Clear disclosure on use of proceeds  What if minimum subscription level is attained?  Returns to be made to the Authority on application of proceeds bi-annually

12.  The Public Offer Regulations do not stipulate specific requirements for Note Trustees. However, the Note Trustee’s responsibilities as contained in the Trust Deed should be disclosed in the disclosure document.  The Note Trustee should be independent of the Issuer and preferably a licensee of the Authority wherever possible. This is for accountability and oversight purposes by the Authority.  Note Trustee to provide a statutory declaration on its independence from the issuer or any other party in the transaction.  The Note Trustee should also confirm that they understand their responsibilities as contained in the Trust Deed appointing them.

13.  Key audit matters that are identified by the auditors in the course of performing their audit for the latest accounting period should be included in the disclosure document. There should also be comment from management on how they are addressing the issues identified  This is to enhance transparency by ensuring that all material issues identified by auditors are made public  Inclusion of a Management Commentary on the latest financial statements of the potential issuer in the issue documentation.  The management commentary will be expected to give additional information on the operations and prospects of the company

14. Submission to the Authority signed copies of all agreements between itself and transaction team before the offer opening date as well as the signed Information Memorandum and/or Prospectus.

15. THANK YOU!