Non Accredited Investor
A non-accredited investor is an investor who fails to meet the net worth or income requirements defined by the Securities and Exchange Commission (SEC). Non-accredited investors are sometimes referred to as retail investors. The concept of a non-accredited investor comes from the various SEC acts and regulations that refer to accredited investors. An SPV Organizer […]
OA (Operating Agreement)
LLC Operating Agreement is a document that customizes the terms of a Limited Liability Company (LLC) according to the specific needs of the owners and outlines the financial and functional decision-making in a structured manner. An Operating Agreement is a crucial document that should be included when setting up an SPV. The document, once signed […]
OFAC (Office of Foreign Control)
Office of Foreign Assets Control is a financial intelligence and enforcement agency of the United States Treasury Department. It administers and enforces economic and trade sanctions in support of the United States national security and foreign policy objectives. The OFAC sanctions list is designed to facilitate the use of the specially designated nationals and blocked […]
Opportunity
When an SPV Organizer has concluded that a particular deal or asset is of a certain quality they share that deal or asset with their network of investors as an “opportunity”. An opportunity is the chance for an investor to subscribe to an SPVs offering of investing into a private asset.
Organizer
An individual, entity, syndicator, angel group, fund or venture capitalist who organizes SPVs and raises funds by reaching out to their network of accredited investors to invest in private assets.
Oversubscribed
Oversubscribed is a situation in which an asset, like a startup company or real estate project, has more investment interest than allocation available. For example, a start up company is raising $1 million in new capital and the SPV Organizers and venture capitalist offer $3 million in capital. This means this startup company is oversubscribed […]
Ownership Class
Different types of stock– Series A stock holders own a different ownership class than Series B stockholders, Common stockholders own a different share class than the series A or B investors, etc.
PCA (Post Close Activity)
A post-closing activity (PCA) is any event that requires active administration of the SPV by the investment portfolio, the Organizer, or the investors in the fund. There are two categories of SPVs PCA, administration of the SPV and the SPV acting in its role as an investor in an asset. Types of administration of the […]
PE (Private Equity)
Private equity is equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity. Capital for private equity is raised from retail and institutional investors, and can be […]
Plan Asset Rule
An entity, such as an SPV that is not itself a plan subject to ERISA, is treated as holding assets of the investing employee benefit plans if it appears that its primary purpose is to invest retirement plan assets. This is known as the “look-through rule.” The determination of whether an entity is treated as […]
Portfolio
A grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents. A portfolio may consist of non-public securities, like start up companies, real estate, art, and secondaries. Investing into private assets through a number of SPVs would result in a portfolio of private assets.
Portfolio Company (Investment Portfolio)
A start up company, company or entity in which an SPV invests into.
Private Transaction
A purchase or sale of assets that are not publicly listed. SPVs are used to aggregate capital to participate in a private transaction.
Pro Rata (Proportionate Allocation, Pro Rata Dividends Share, Pro Rata Investment Opportunity)
Pro rata is the term used to describe a proportionate allocation. It is a method of assigning an amount to a fraction according to its share of the whole. Pro rata in business financing may be used to identify the amount of shareholders dividend according to its share in the company. For SPVs, pro rata […]
Public Transaction
A purchase or sale of assets in which there will typically be no identifiable party to stand behind the obligations of the transaction after closing. In a public company transaction, the target company is subject to ongoing disclosure requirements by the Securities and Exchange Commission. This means that there is a significant amount of information […]