A mini-maxi offering has a minimum of $15 million and a maximum of $30 million. After the offering period, $22 million in subscriptions have been received. Which statement is correct?

AThe offering must be canceled because it did not reach the maximum
BThe offering can close at $22 million since the minimum threshold of $15 million has been met✓ Correct answer
CThe offering must close at exactly $15 million or $30 million, with no amount in between
DThe underwriter must purchase the remaining $8 million to reach the maximum

Explanation

Why B — The offering can close at $22 million since the minimum threshold of $15 million has been met

In a mini-maxi offering, the issuer sets both a minimum and maximum amount. The offering can close at any amount between the minimum and maximum. Since $22 million exceeds the $15 million minimum, the offering can proceed and close at $22 million. If subscriptions had not reached $15 million, all funds would have been returned to investors. This structure gives the issuer flexibility while ensuring a minimum level of capital is raised before any funds are released from escrow.

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