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Exemption situation

Overview

With banks unwilling to lend and public markets all but closed, UK companies have been tapping their existing shareholders for cash by means of rights offerings. According to Trowers & Hamlins partner Richard Hilderbrand, who has been involved in several UK rights offerings, such rights offerings by UK companies that are not listed on US exchanges, typically contain language excluding US shareholders from participating in the offer and prohibit sending the UK prospectus into the US. US shareholders may, however, participate in a rights offering, and the company may send the prospectus into the US, if an exemption from the registration requirements of the US Securities Act of 1933 is available.

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