Equity Line of Credit (ELOC)
A committed standby equity facility from institutional investors — draw capital when you need it, on your timeline.
What You Get
- ✓Capital on demand after listing
- ✓Issuer controls timing and draw size
- ✓Institutional counterparties arranged by us
- ✓Pairs naturally with a direct listing
Built Into Every Deal
Flat-fee engagement. Directly Listed charges a flat platform fee plus an equity grant at signing — quoted individually for every deal. No percentage-of-raise surprises.
eSignature execution. Subscription agreements and engagement letters are executed through Adobe Acrobat Sign with full audit trails.
Payments. Investors fund by card for amounts under $5,000 (processed by Braintree, a PayPal service) and by wire or ACH above that.
Issuer-exemption model. Directly Listed is a technology platform; offerings are conducted by issuers in reliance on their own exemptions, with compliance workflows — accreditation, investor limits, KYC — built into the software.
Flat Fee Disclosure
Our SEC-licensed attorneys, consultants, and listing advisors are all paid out of the flat fee we charge. There are no separate legal bills—only third-party costs, such as legal opinions, valuation reports, audits, transfer agent and DTC fees, exchange application fees, and any annual exchange fees.
The flat fee is determined by the scope of services provided and your company's stage, along with an equity grant that is likewise set according to your startup's stage and needs. Every deal is quoted individually.
Equity Line of Credit — Term Sheet
A $750 million equity line of credit (ELOC) can be a useful tool for our listed companies to raise capital, providing a flexible and cost-effective means of obtaining funds. An ELOC is a financial arrangement between our client and a referred financial institution in which the client can access a pre-approved equity facility — typically secured by the company's common stock — and draw down as needed, up to $750 million.
- Duration
- 24 or 36 months.
- Determination of Purchase Price
- Generally a 5–10% discount to the volume-weighted average price (VWAP) of the company's common stock over the 10 business days following the company's delivery of a drawdown notice to the investor.
- Minimum Acceptable Price
- The company may specify a minimum acceptable price in connection with a drawdown notice, but is not required to do so.
- Investor Fee
- The investor typically receives a fee in stock upon signing the equity purchase agreement. Fees vary, but recent deals have ranged from 2–4%. The investor also typically receives a small expense reimbursement (e.g., up to $50,000).
- Registration Statement or Prospectus Supplement
- If the company does not have an effective registration statement on file for the investor's shares, it typically must file a new registration statement (Form S-1, S-3, F-1, or F-3) within a specified period after execution of the equity purchase agreement (e.g., 30 or 60 days) or pre-listing, and cause it to become effective as promptly as practicable (some deals impose a 90-day deadline; some, 10 business days after notice that the statement is not subject to SEC review). The registration statement must be effective before the company can draw down on the equity line. If an effective registration statement already exists, the company typically files a prospectus supplement describing the transaction before commencing sales.
- Representations
- The company makes a full suite of representations and warranties about its business and its SEC disclosure.
- Short Sales
- The investor typically represents that it does not have a net short position in the common stock and covenants that it will not enter into or effect any short sales of the company's common stock.
This summary is provided for information only and does not constitute an offer, commitment, or legal advice. Final terms are set in the definitive equity purchase agreement for each engagement and are subject to the referred institution's approval and applicable law.