How It Works: Freqently Asked Questions
Investor Eligibility and Accounts
Can anyone bid for OpenBook® auction offerings?
Institutional Investors who have been approved by WR Hambrecht + Co or an offering joint manager may participate. If you have questions about your eligibility, contact us at OpenBook@wrhambrecht.com.
Are auctions open to non-U.S. participants?
Yes, if foreign participants are permitted to participate in a particular offering and
eligible in their home markets to open accounts
with U.S. broker-dealers and to purchase U.S. registered bonds, or if the investor has
an account at a non-U.S. broker-dealer that is participating as an underwriter in the
transaction. If you have questions about your eligibility, contact us at OpenBook@wrhambrecht.com.
How do I open an account to participate in an OpenBook auction?
Visit the Open Account page for instructions on how to participate in OpenBook auctions.
Process
Where can I find information about upcoming OpenBook auctions?
Registered participants will be notified of upcoming auctions electronically. You may also find information about upcoming auctions on the OpenBook Homepage.
How do I prepare to bid in OpenBook auctions?
Investors must register in advance of an auction. Upon receipt and approval of required forms, WRH+Co will send the investor a User ID and password. A prospectus describing the securities being offered will be made available on the OpenBook Homepage and should be read before making a decision to bid. Visit the Open Account page for more information about opening an account.
How do I log into OpenBook?
Investors with a User ID and password may login to an auction by clicking on View Prospectus & Enter Auction from the OpenBook Homepage.
Next, click on “Click Here to Enter Auction”. This link leads to the login page where you can enter
your User ID and password.
How are transactions settled?
For each auction, one of the joint managers will be selected to clear and settle the offering.
What terms are set before an auction begins?
The issuer sets the following, which are announced before an auction:
- A Deal size
- A benchmark Treasury bond
- A minimum and maximum acceptable bid spread over the benchmark Treasury bond rate
- A maximum for the benchmark Treasury bond rate
- A maximum bid size per investor
- A protected spread range
- A maturity
What is the benchmark Treasury?
The benchmark Treasury is a chosen reference U.S. Treasury security of comparable maturity to the bonds being auctioned. The benchmark Treasury rate will be used to price the bond after the auction.
What is the “spread over the benchmark Treasury rate?”
The spread over the benchmark Treasury rate is the differential in basis points between the Treasury rate and the rate on a particular bond.
Technology and Security
Do I need to download special software to participate?
No, as long as your computer is equipped with a standard Web browser such as Netscape Navigator™ 6.0 or higher or Microsoft Internet Explorer™ 4.0 or higher, with javascript and cookies enabled. The monitor resolution should be set to a minimum of 800x600 for optimum readability.
Can my Internet connection affect my OpenBook auction participation?
System response times may vary due to a variety of factors, including but not limited to high Internet traffic and local Internet service provider problems.
How can I be sure that my bid is secure?
An OpenBook auction uses the same SSL Web encryption technology that is used to protect online banking transactions. If you have further questions about transaction security and technology, notify us at OpenBook@wrhambrecht.com
and we will be pleased to discuss the relevant issues.
Miscellaneous
How much does it cost to use the OpenBook® auction?
Investors pay no fees and no commissions for use of the OpenBook Bond Auction process. As in other offerings, the underwriter is compensated through a discount in purchasing the bonds from the issuer.
