Prospectus
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Placement Memorandum, or short PPM.
Disclosure
A PPM is a disclosure document that includes relevant disclosures about your company that allow investors to weigh the risks involved with giving your company an investment. While many PPMs share similarities, they are all different due to uniqueness of each deal and the uniqueness of each investment. They should contain information on the business, financial information, legal structure and ownership information, and information related to the offering itself. It should also contain information stating that state securities regulations do not apply.
Insurance
You should consider the PPM an insurance-type expense. The PPM can be used to thwart off frivolous claims from both investors and government regulators. It is not a foolproof defense by any means, but it makes it harder for a potential litigant to win a claim and it improves your defense.
Risk
A private placement memorandum (PPM) presents an opportunity both to sell your privately offered securities to investors and to protect your companie’s interests. It is important to keep in mind that, while you do want the document to help compel investors to move forward, if they do so without a full understanding of the risks involved you open the door to legal action and investigation by the Financial Authorities.
Much in the same way that a prescription drugs must explain risks in public advertisements, securities must do the same. While health and life is at stake with prescription drugs, the savings and financial security of investors are at stake in a private placement due to the volatile nature of the returns they can expect. You should be prepared for the worst in terms of lawsuits, even while hoping for the best.
The risks involved with investing in your company must be laid out carefully in a private placement not because of a government requirement to do so. Disclosing these risks clearly before investors part with their cash is the best way to protect your firm from lawsuits claiming you defrauded or misled them. General risk factors are common for most or all private placement offerings. A disclaimer is needed in your PPM. Furthermore, investors may not be able to sell the securities for a given holding period and must be made aware of this.
Specific risk factors should touch on the challenges your firm faces. These include challenges to its industry, customers, strategy, and management. For example, if there is a chance that key management members will leave the company and cause a need for a costly search for a replacement, this should be covered. If competitive threats may derail the plans of the business entirely, this should certainly be mentioned.
Covering risks specific to the firm reduces the chances that an investor will cry foul and file a lawsuit if these worst-case scenarios occur. If you are sued, the PPM serves as a clear record that you communicated the risks from the outset.
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Writing
The process of writing a private placement memorandum requires necessary knowledge, skills and experience. It is also a time-intensive process. Save your precious time and let our team of experts writes your private placement memorandum for you. This way you are able to spend more time on the actual start or growth of your company. A private placement memorandum written by ICMA gives you the opportunity to attract a great amount of investment in your company.
Because of our expert approach and cost-effective method, we are able to offer a fully customized private placement memorandum drafted at a competitive rate.
Our service offering is tailored to both start-ups and existing companies that are entering a new phase or want to grow beyond their business borders. We are able to professionally put your plan on paper in a well-organized structure. This can be done in the form of a whole private placement memorandum, but it is also possible to write a specific portion – for example, the financial part.
If you already own a written private placement memorandum which was not approved, then ICMA is the suitable service provider to rewrite your memorandum. With the clever use of our overheads we can deliver a custom-made private placement memorandum at a competitive price, contact us for more information.
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Contact details
BUSINESS ADDRESS
1435HW Rijsenhout
The Netherlands
Phone number
REG.
REG. 27372151
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