The managing underwriter shall announce the guide for subscription under joint signature of the issuer, the managing underwriters, underwriters, and sales agency securities companies handling subscription service pursuant to the details of simplified prospectus submitted along with the registration statement during the period from the submission of the registration statement until the subscription date.
Subscriptions are generally received through the real name confirmation process of the managing underwriter and sales agency securities companies for 2 days after the registration statement becomes effective, which then proceed according to the subscription criteria published to the investors in advance.
The managing underwriter and sales agency securities companies determine by themselves a certain degree of margin pursuant to market status, the number of stocks offered, etc. in order to prevent non-fulfillment of subscription.
The managing underwriter allocates shares according to its allocation criteria after closing of the subscription. Following are the allocation ratios of the subscription.
|Group of subscribers||allocation ratio|
|Employee stock ownership association||20%|
|General investors||20% or more|
In case of allocating the stocks of public offering, the managing underwriter shall not allocate the stocks to interested parties of the issuer or underwriters, and the persons having significant interests relating to the public offering, for example, providing the issuer or underwriters with relevant services.
The managing underwriter can adjust the volume of the public offering according to market status by using over-allotment option system which allows issuing more stocks than the quantity to be determined to offer after discussing with the issuer.
As the number of the allocated stocks has been confirmed, the managing underwriter and sales agency securities companies substitute subscription margin for the payment for shares thereon, refund the excess subscription margin to each subscriber. In the contrary case, subscribers shall pay the shortfall additionally, and underwriters shall underwrite the stocks unpaid on their own accounts.
The payment procedure is completed when the managing underwriter pays subscription money to the designated bank, receives the certificate for the deposit of subscription money from the bank, and transfers it to the issuer.