The issuer of a tender bond indicates in advance the interest rate, term to maturity and (approximate) amount of capital required, albeit without revealing the issue price. In order to subscribe to the bonds prior to their being traded on the exchange, interested investors must not only be prepared to pay the specified amount (e.g. CHF 30,000) but also submit a bid for the issue price (e.g. 100.6%).
In allocating the bond issue, the issuer takes into account the best bids until its capital requirements are met. If that sum is achieved with, for example, an average bid of 100.5% or higher, the entire issue will be placed at that price. Investors who bid more than 100.5% will get their full allotment. Those who bid precisely 100.5% will, under circumstances, get only a partial allotment, while lower bidders will come away empty-handed.