Glossary

Analytical report

A report including company description, business development, financial and other key economic indicators verified by an analyst authorised by the Prague Stock Exchange.

Company statutes

Company statutes represent a basic document establishing a company and defining its fundamental internal functional rules.

Covenants

Covenants in finance relate to terms (e.g., debt-earnings ratio) in a financial contract, such as a loan document or bond issue defining the limits of the borrower’s furtherer lending.

Creditor

A creditor or lender is a party that has a claim on the services of a second party. It is a person or institution to whom money is owed.

Crowdfunding

Crowdfunding is the practice of funding a project or venture by raising small amounts of money from a large number of people, typically via the internet.

Dividend

A dividend is a distribution of profits by a corporation to its shareholders.

Equity

Equity represents a financial or non-financial contribution to a company in exchange for a share in the company’s ownership.

ISIN

An International Securities Identification Number (ISIN) is a code that uniquely identifies a specific securities issue for the purposes of trading securities. The organisation that allocates ISINs in the Czech Republic is the Central Securities Depository Prague.

Issuer of securities

An issuer is a legal entity that develops, registers, and sells securities for the purpose of financing its operations. Typical examples of securities are bonds, company shares or investment certificates.

Legal due diligence report

Review of all company documents to verify their accuracy and completeness, conducted by a legal advisory firm, authorised by the Prague Stock Exchange.

Liquidity

Liquidity refers to the efficiency or ease with which an asset or security can be converted into ready cash without affecting its market price.

People-to Business (P2B)

P2B represents the direct business relationship between people and businesses.

Principal

Principal is the original sum of money borrowed in a loan or put into an investment.

Proof of concept

Proof of Concept (POC) is a small exercise to test a design idea or assumption. The main purpose of developing a POC is to demonstrate functionality and to verify a certain concept or theory that can be achieved in development.

Prospectus

A prospectus is a formal document required for securities offered to the public, which is filed for offerings of stocks or bonds. The document can help investors make more informed investment decisions because it contains a host of relevant information about the investment security.

Roadshow

A roadshow is a series of presentations made in various locations leading up to a public offering. The roadshow is a sales pitch or promotion made by the underwriting firm and a company’s management team to potential investors or creditors before going public.

Securities issues

An issue is a process of offering securities in order to raise funds from investors. Companies may issue bonds or stocks to investors as a method of financing their businesses.