Hey, businessmen! Are you raising money by means of a Private Placement Memorandum (also known as the Offering Memorandum, PPM Offering, Regulation D Exemption Rule 504, Rule 505 or Rule 506? If you raise money by means of a Regulation D, Private Placement Memorandum, you must know the ins and outs of the laws governing this transaction.It’s surprising how many people are going to pay big bucks for someone to write a PPM for them, but when it’s complete, they just have a stack of papers and no knowledge of how to promote their PPM to raise capital and stay within the SEC definition laws governing this cash-for-equity transaction.
A nice, general definition for one of these codes called Blue Sky Laws can be found on Wikipedia that states: A blue sky law is a U.S. state law that regulates securities offering and selling to protect the public from fraud. While the specific provisions of these laws vary between states,
They all require all securities and sales offers to be registered, as well as stock brokers and brokerage firms.The blue sky law of each state is administered by its appropriate regulatory agency, and most of it also provides private causes of action for private investors injured by securities fraud.
A private placement memo will help you stay within the guidelines of the SEC as you raise capital. Choose your PPM authoring firm wisely as it is a highly technical document, but you can easily get the money you need if it is well written.