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Private Placement Memorandum

Michel Morin's Profile

I need to draft a PPM and I am searching for PPM samples, preferably in the software industry. The "Risk Factors" section is particularly challenging. Does anyone have suggestions? Thank you.

Answers

Thomas Phillips
Title: President
Company: Effective Agreements
(President, Effective Agreements) |

Finding PPMs may be a challenge because of confidentiality. Do you have a funding source or a law firm that might supply one or two redacted examples?

The risk section is a challenge, but here is one suggestion. Interview the management team, down to the manager level. You should use a set of questions that address all of the major parts of the business where risk can reside and ask the questions of the executives over the relevant areas. A thorough due diligence checklist can be a good guide regarding what questions to ask. So can the reps and warranties section of an M&A definitive agreement.

david waltz
Title: Assistant Treasurer
Company: Integrys Energy Group
(Assistant Treasurer, Integrys Energy Group) |

You can probably get a long way towards the risks by reviewing public company's 10-K's in your industry and then tweaking for your specific situation.

Michel Morin
Title: Director of Finance
Company: Imacuclean Cleaning Services, Inc.
(Director of Finance, Imacuclean Cleaning Services, Inc.) |

Thank you David. This is an excellent suggestion. An SEC Registration Statement on Form SB-1 for instance would probably be helpful too. I don't know if Edgar can still be accessed for free but I will try... Michel

david waltz
Title: Assistant Treasurer
Company: Integrys Energy Group
(Assistant Treasurer, Integrys Energy Group) |

Michel - thanks for the feedback. Good luck creating your PPM.

Topic Expert
Jim Quinlan
Title: CFO, Managing Director
Company: Trinity Group, BlueGold, Genergy, Wellco..
LinkedIn Profile
(CFO, Managing Director, Trinity Group, BlueGold, Genergy, Wellcount) |

Most of the "Risk Factors" to include are ones common to all businesses -- market, regulation, personnel (to name a few). You can get that 90% from any PPM. Many PPMs are available on line -- read and plagiarize, so to speak.

If your particular business has a risk, then its explanation should be added. Think through your business cycle for product delivery and customer procurement (including payment) and you will have enough to scare an investor so much that s/he cannot complain if anything goes wrong.

Best blessings in successful fund-raising!

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