Prospectus of the debenture issue (art. 340 LGS)
Article 340 of the General Companies Law requires a prospectus when the debenture issue is offered to the public, with the essential information about the company and the issue.
What article 340
Article 340 governs the prospectus of the public issue of debentures.
In cases where the loan is offered for public subscription, the company shall prepare a prospectus that must contain: 1) the specifications of article 336 and the registration of the trust agreement; 2) the company's activity and its development; 3) the names of the directors and statutory auditors; 4) the result of the financial statements.
Source: Law 19.550, art. 340 — InfoLEG (updated official text)
Commentary
The prospectus is the informational document for the public investor: it allows them to assess the risk of lending to the company. It is analogous to the prospectus of the public offering of shares.
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