Prospectus and information memorandum templates

Pursuant to the ‘Law of the Republic of Azerbaijan on the Securities Market’ (hereinafter – the Law), public offering or admission to trading of investment securities shall be accompanied by a prospectus or information memorandum.

The purpose of preparing these documents is to provide investors with transparent and comprehensive information to support their investment decision-making. The prospectus or information memorandum shall present, in a clear, precise, and comprehensible manner, the financial position of the issuer, the securities to be issued, and the rights and risks associated therewith.

In the event an issuer makes a decision on several issuances of securities during one calendar year (except for shares), a base prospectus can be prepared. The provisions of the Law applicable to the prospectus shall also apply to the base prospectus.

An information memorandum shall be prepared instead of a prospectus where:

investment securities, including the rights attached thereto, are offered to or placed with shareholders or participants of a legal entity in the course of its merger with the issuing legal entity.
investment securities, including the rights attached thereto, are offered to or placed among shareholders or participants of separating legal entity.
total amount of securities issued does not exceed the threshold set by the Central Bank.
total nominal value of the issuer’s investment securities issued within one calendar year does not exceed the threshold set by the Central Bank.
investment securities are offered to institutional investors.

Pursuant to Article 5.6 of the Law, an issuer shall be exempt from the obligation to prepare a prospectus and an information memorandum where:

the State or a municipality, international organizations delegated by the Republic of Azerbaijan, or the Central Bank issues investment securities.
investment securities are issued with a state guarantee.
value of investment securities offered to each investor exceeds the threshold set by the Central Bank.
shares, for which no payment is required from shareholders, and which are issued in lieu of dividend payments in the same class of shares, are issued.
shares, issued on a regulated market within one calendar year are publicly offered at an amount of less than ten percent of the issuer’s authorized capital.
investment securities are not intended for public offering.

Note: Where investment securities are not admitted to trading on a regulated market or their public offering is not carried out within one year from the date of approval of the prospectus or information memorandum, the prospectus or information memorandum shall be deemed null and void.

The requirements for the prospectus and information memorandum shall be governed by the Regulations on requirements for prospectus and information memorandum.