A Regulation D private placement memorandum (PPM) is generally required in order to raise capital from high net-worth individuals and from some institutional investors. This legal document requires a high level of skill and experience, and our Reg D PPM attorneys are experts in the drafting of this important legal instrument.

Should you Consider Buying a Template or Using a Cheap Regulation D Private Placement “Mill” to Draft Your PPM?

NO. ALMOST NEVER. You could purchase a Regulation D PPM template for a few hundred or a few thousand dollars but the entire purpose of having the private placement memorandum would be completely defeated. You absolutely NEED a skilled PPM attorney to draft a private placement offering. There are only a small number of circumstances in which a template or a non-attorney should ever be used to draft a Reg D private placement memorandum; call us now and we will share those circumstances with you, and we can even offer you an inexpensive option if your circumstances fit. That said, below are some excellent reasons to reconsider imprudent short cuts.

What are the Risks Companies Face by Attempting to Take Shortcuts?

A Regulation D PPM is NOT a formality; it is designed to “save your bottom”: Would you buy a discount parachute? Why not? A Regulation D PPM drafted by a private placement law firm, such as ours, is designed to properly and skillfully disclose representations and risks so that investors won’t be able to sue you later if the business deal you have presented them doesn’t turn out as well as hoped.

Small Private Placement Memorandum errors can lead to huge financial and legal risks later: Even a Reg D PPM drafted by a skilled private placement lawyer, if used with a slightly imperfect marketing or distribution plan, can land the issuers in very hot water and not uncommonly in jail–yes jail. The US Attorney’s Offices, State’s Attorney’s Offices, Securities and Exchange Commission, and Secretaries of States Offices throughout the United States have never been more aggressive in investigating failed securities offerings in our nation’s history. Can you guess why? Every heard of a guy by the name of Madoff?

Wanna be a daredevil? If you are raising less than $10,000 and you are a daredevil, or if you are selling your offering only to a small number of family members, a boiler plate private placement memorandum may be just fine for you. However, if you are raising over $10,000, and you like sleeping soundly at night, there are far too many risks to be “penny wise and dollar foolish.”If you have a risk adverse nature, go bungy jumping, but don’t risk your personal assets and your freedom.

What about using a template? A boiler plate template Regulation D PPM or an amateur created Private Placement Memorandum are both worth only the cost of the paper upon which they are written: Most boiler plate private placement memoranda and those written by inexperienced lawyers cannot be used for any purpose, and they are useless and dangerous because they provide a false sense of security.

PPM drafting can be described as the art of drafting around future nightmares: The art of drafting a Regulation D private placement memorandum is revealed in the experience of the PPM lawyer—writing services and templates are useless. If you are inclined toward this shortcut option, we have a money saving tip for you—simply don’t spend the money at all and don’t issue a PPM. You can use the money saved to later defend a future potential investor or regulatory action.