The Bond Market & Legal Mechanics of Note Issuances

• Get an overview of the bond/capital markets, including the timescales and risks involved for the relevant parties on a bond issuance transaction.
• Covers the legal characteristics of emerging markets bonds and the legal mechanics of how bonds work and how they are cleared/settled.
• Covers the technical legal aspects as well as the detailed practical step by step process of issuing bonds.
• Provides an outline of the pros and cons of stand-alone bond issuances vs programme-based MTN bond issuances.
• Be appraised of the various aspects of due diligence required when issuing bonds and the types of investors targeted (Reg S vs Rule 144A).
• Learn about the Prospectus Directive requirements, the selling restrictions including the US ones that are relevant to bond issuances as well as the implications of the Market Abuse Directive.

The Bond Market

• The International Capital Markets
• The ICMA (International Capital Market Association)
  • The ICMA Recommendations & Handbook
  • Standard form documents & language
  • Negotiating Auditors Letters
• 4 Categories of issuance of equity Securities

The Legal Characteristics of Bonds

• Key Features
• Key Concepts
  • Fungibility
  • Negative Pledges
  • Custody
  • Subordination
    • Legal
    • Structural
    • Contractual
      • Trust Subordination
      • Contingent Debt Subordination

The Legal Mechanics of How Bonds Work & Clearing

• Bearer vs Registered Bonds
• Global vs Definitive Bonds
• Temporary vs Permanent Global Bond Market Notes
• CGN vs NGN Structure
• Clearing and Settlement of Bonds
• Credit Rating of Bonds
• Exercise: Participants will be placed in groups and given a set of questions to discuss and respond to in order to consolidate their knowledge on Part 1 of the webinar.

Processes for Plain Vanilla Listed Securities Issuances

• 4 Stages of a Stand-alone Bond Issue
• Programme-based Note Issue
• Due Diligence
  • Purpose and Scope
  • Legal due diligence
  • Accounting and financial due diligence
  • Business due diligence
  • Process
• Reg S vs Rule 144A due diligence
• 10b-5 legal opinions
  • US law liability and defence
  • Content

The Prospectus

• Requirement to publish a prospectus
  • Scope of Green Bond Market
  • Exemptions
• Format and Content
  • Retail
  • Wholesale
• The changes made by the new Prospectus Directive
• Risk Factors
• Listing
  • Approval
  • Publication
    • Preliminary prospectus (Red)
    • Final prospectus (Black)
    • Supplementary prospectuses
• Group Discussion Exercise on plotting out the exact timeline of key deliverables from start to closing day, identifying the risks to the various parties involved at each of the different stages
• Implications of the Market Abuse Directive
• Selling Restrictions
  • EU
  • US
  • Other Jurisdictions

The trainer is an expert in structured finance specialising in securitisation, real estate finance, banking, capital markets, derivatives, structured products and financial regulation.

She is a consultant, keynote speaker, business adviser, author and trainer and has practised law for nearly 20 years in the banking & finance industry. She has spent her career advising some of the most prestigious global financial institutions such as Goldman Sachs, Morgan Stanley, Citigroup & Credit Suisse. Her primary role was to manage the legal risk globally across the various businesses within an investment bank. As a trainer, she now designs and leads training workshops for senior lawyers, law firm partners, accountants, bankers and various senior executives.

She has been actively involved in the creation of innovative structured transactions; structuring, drafting and negotiating complex financings including complex repo facilities, hybrid structured products with multiple embedded derivatives, repackaging, synthetic CLOs and regulatory-driven structured transactions; all types of securitisation transactions and restructuring them; supervision of large scale remediation project involving the mis-selling of bond market interest rates swaps, financial regulatory projects and financial litigation.

She holds a Law LL.B (Hons) degree from University College London (UCL) and has worked in the Finance Know-how team at Clifford Chance. She trained at Sidley Austin Brown & Wood LLP and worked on a number of award-winning transactions involving repackaging, securitisations and US corporate bond market securities. She practised as a solicitor at Linklaters LLP in Singapore and has also worked in New York and Hong Kong.

Returning to London, she spent around 5 years at Allen & Overy LLP. She advised on a wide range of issues including asset swap bonds, insolvencies, disclosure matters under the Prospectus Directive, US 144A SEC-registered deals, real estate finance, master trust, CMBS and RMBS securitisations and Opco/Propco structures for loan securitisations. She was seconded to Credit Suisse to work on the Real Estate Finance trading desk where she worked on loan origination, leverage finance and acquisition finance deals. Later she was seconded to Citibank where she advised on LMA loans, highly structured real estate finance transactions, risk mitigation and syndication.

In 2007 she moved to Credit Suisse as in-house legal counsel advising on structured capital markets, derivatives and structured products including fund-linked products, a range of exotic trades, CDOs, CLOs, repos and other highly structured financing transactions conducted during and post-credit crunch. She structured and documented trades that achieved the required regulatory capital and balance sheet treatment using a combination of techniques such as credit default swaps, call options or unfunded loan participations.

She started working as a specialist consultant in 2009 advising her clients on complex projects involving legal, operational, regulatory and compliance matters on derivatives, structured products.

This course provides an overview of debt securities and bond trading. It is relevant for in-house lawyers and private practice lawyers alike as well as bankers, bond traders involved in anything from the day to day business such as the usual plain vanilla bonds to the more complex heavily negotiated transactions involving structured securities or unusual assets. This course will also be relevant to the Operations and Documentation teams involved in bond transactions from time to time, structurers, compliance personnel as well as accountants who advise clients on bond trades.

The first part of this course sets the scene by introducing the treasury bond market including the ICMA, The ICMA Handbook & Recommendations with an overview of the categories of debt securities in the market. We then discuss in detail the legal characteristics of bonds including the key concepts embedded. We cover in detail the legal mechanical production of how bonds are created, cleared and settled. We conclude this by undergoing a group exercise so that the participants have the opportunity to consolidate their knowledge.

In the second part of the course, we then cover the 4 stages of a bond issue, look at stand-alone vs programme-based bond issues and go through the various aspects of due diligence that are required. We discuss the differences in due diligence burdens between Reg S vs Rule 144A offerings and the provision of a 10b-5 legal opinion. We will then dwell on the discussion of the requirements of the Prospectus Directive, listing and the publications of a Red and a Black Prospectuses. We will then have a group discussion exercise which will involve plotting out the exact timeline of key deliverables from the start to the closing of a bond issuance, identifying the risks to the various parties involved at each of the different stages. We will then proceed to go through the implications of the Market Abuse Directive and finish off with a discussion on selling restrictions. We will conclude this by going through some group case studies so that participants can be provided with practical examples and be given the opportunity to analyse them.