The Regulation D exemption allowsyou to raise either debt or equity money for your company by using a Private Placement Memorandum document as the official disclosure paperwork that you give to prospective investors. Attorneys charge thousand of dollars to fill in their templates, now you can do-it-yourself. Take a Look
Easy, step-by-step instructionsguide you page-by-page. Our template is not a skimped down version it's over 90 pages. It offers all the proper sections to give you full liability protection against false disclosure. You receive the document template in easy-to-use Word® format. Just edit the template information to fit your particular projects needs. This allows you to comply with all federal and state security laws and assures that you furnish the same information to all prospective investors equally.
There is no limit on the amount or typeof funding you require. We have templates that fit your particular type of company (C-corps or LLC) and your size of offering for either debt (promissory notes or bonds) or selling equity stock shares or membership units for raising start-up funds to multi-millions.
Our Template is not a software program.The template file is delivered in Microsoft Word Format and it is fully editable. It is delivered via email download available immediately following verification and approval of your purchase. The template file is packaged in a .zip file.
Place a quick, easy, credit card orderand your template is available immediately. After purchase, you will receive an email receipt with a link to download your template.
For most entrepreneurs, the best way to raise money, either debt or equity, is to obtain their financing using Regulation D (Reg D) documentation. This is an exemption which allows a limited offer and sale of their company's securities, stock units or debt without registration under the Federal Securities Act of 1933. It is accomplished through the use of a Private Placement Memorandum (PPM).
By complying with Reg D, it provides the company, its officers, and its directors with an insurance policy of sorts regarding disclosure.
You - the company issuing the securities - have complete control on how you structure the deal. For equity deals, you decide what the price of the stock will be, how much money you want to raise, and how much of the company you want to give away as well as any other terms and conditions. For debt deals, you decide what the interest rates will be and what your plan for the timing and amount of repayment will be.
There Are Six Basic RulesRegulation D consists of six basic rules.
Rule 504 is considered by many as the perfect answer for the company just starting out OR one that needs to raise less than $1 million.
You Cannot Exceed $1 Million.The total offering amount under Regulation D Rule 504 can be up to $1 million in a 12-month period, less the aggregate offering of all securities sold within 12 months before the start of a 504 offering. So, if a company has raised $100,000 in private money in the previous 12 months, it can still raise up to $900,000 without being accused of breaking the rules, or "integration."
Generally speaking, Federal Rule 504 is the simplest Reg D document to fill out. It does require the submission of Form D to the SEC and the rule is dependent on the blue-sky laws of each state in which the securities are offered. This means that if a state's blue-sky rules require disclosure, it must be provided regardless of Federal Rule 504.
A word of caution to the entrepreneurRegardless of the amount of disclosure the issuer is willing to provide, Rule 504 does not dismiss the issuer from the federal requirements, nor is there an exemption from the fraud provisions, including the areas of material omissions or misstatements. The penalties for noncompliance are severe, including monetary fines and mandatory jail sentences.
Number of Investors.With its limited disclosure requirements, Rule 504 also allows an issuer to sell securities to an unlimited number of investors. Theoretically, a company could raise $1 million by selling its stock at a penny a share to 100 million different investors. Obviously, the administrative economics are not too attractive, but there's no rule that stops an issuer from selling $500 blocks of stock to 2000 investors. Rule 504 is the only rule under Reg D that permits an unlimited number of investors.
The Rule 504 exemption provides for sales of securities of either debt or equity. This opens the door for combinations of both via convertible debentures. By way of explanation, convertible debentures are a debt issue (debenture) that is convertible to a preferred or, most commonly, common stock at some future date. Rule 504 does not require audited financial statements.
Rule 504 exemption is provided for almost any type of organization, including corporations, LLCs, partnerships, trusts, or other entities.
Rule 505 is used for offerings of $5 million or less in any 12-month period and is restricted to 35 purchasers other than "accredited investors."
There are a number of required disclosures if the sale of securities includes investors who are not accredited investors: advertising and a general solicitation are prohibited, one must inform purchasers that they receive "restricted" securities (meaning that the securities cannot be sold for a time period without registering them), you must not violate the antifraud prohibitions of the Federal Security Laws, financial statements need to be certified by an independent public accountant or at a minimum, the balance sheet needs to be audited.
Companies must give non-accredited investors disclosure documents that are the same as those used in registered offerings. If a company provides information to accredited investors, it must make this information available to non-accredited investors as well. The company must also be available to answer questions by prospective purchasers. The Issuer must comply with the securities laws of each state in which a person who buys the security is a resident, and must usually file a notice with that state's commissioner of corporations or similar official, as well as filing Form D.
Under SEC Rule 506; an issuer may issue an unlimited amount of securities, with no dollar limit, to no more than 35 on-accredited investors plus any number of "accredited investors." There are required disclosures, if a sale of securities includes purchasers who are not accredited investors. All non-accredited investors must be sophisticated and must sign an Investor Questionnaire acknowledging same. Advertising and a general solicitation are prohibited. The securities are "restricted securities" which may not be readily resold.
There is a major advantage to 506, in that it supersedes and preempts the securities laws of all the states. This saves a lot of time, effort, and expense if the issuer is obtaining money from investors in multiple states. Form D must be filed with the SEC within 15 days after the first sale of securities and also with the secretary of state of each state in which a purchaser is a resident.
Your PPM (Reg D) templates are totally inclusive with all the sections, documents, paperwork and filing information you will need. When you have completed filling in the blanks with the information that applies to your business, you will be ready to deliver the document package to your prospective investors.Included are:
This is the actual sales contract that the investor signs to subscribe to your offering. The Investor fills in the blanks for the amount he/she intends to purchase, signs the agreement and sends it to you with his/her check.
This is the set of forms that the investors fill out with certain financial data to qualify them as an accredited or non-accredited investors.
This is the form that you file with the SEC to notify them that you are engaging in a fund raising effort. It does not require approval and you do not submit your business plan or offering document. This four-page form can be submitted electronically.
This is the actual Regulation D Private Placement Memorandum (PPM) offering document that you complete and send to your prospective investors. It includes all the information about your offering, investment terms, your company, your management, use of proceeds, financials, and the SEC legends and disclosures required to comply with the regulations. An overview of the Table of Contents can be found below.
(This sample is for a corporation equity offering; LLC and debt issues vary in details)
This Financing Overview is provided as an informational overview to entrepreneurial financing. You will find sections addressing the following topics:
The Template package includes all sections, documents, paperwork and filing information you will need. When you have completed filling in the blanks with the information that applies to your business, you will be ready to deliver the document package to your prospective investors. Included are:
This is the actual Regulation D Private Placement Memorandum (PPM) offering document that you complete and send to your prospective investors. It includes all the information about your offering: investment terms, your company, your management, use of proceeds, financials, and the SEC legends and disclosures required to comply with the regulations.
After completing the order form, you will receive the template right after completing the order form.How do I know which Form to order?
The order page assists you in determining the proper Template to fit your individual situation. It includes examples of the various Template types and you simply address the following three main choices:
All types, there are no exceptions! From mom and pop retail stores to multi-million dollar super-sophisticated high-tech projects and including all types of real estate deals. Size of the project and type of industry make no difference. The important point is to comply with the security rules and regulations and to present a concise, structured set of professional disclosure documents.Do I really need a PPM offering document?
The primary reason for having a Private Placement Memorandum is that the PPM offering document satisfies the legal issues and rules and regulations for raising capital as well as provides you with a sophisticated and professional way to present your project to prospective investors. If you sell securities improperly, or do not make the proper disclosures, you could face fines and rescission (give the money back), as well as lawsuits from investors or regulatory bodies. By having a PPM, you are complying with the state and federal rules and regulations for selling securities (debt or equity) when raising capital. This includes deals from $100,000 to multi-millions. When you use a Reg D offering memorandum, you limit the liability exposure for the initial owners and directors of the company. The PPM also ensures that you are treating all investors equally. It eliminates the "he said-she said" discussion since all investors are treated equally and sign off on the information that is presented in the offering memorandum.Do I need a Private Placement Memorandum for a start-up?
You may not have much in assets or any revenues, however, this is the ideal time to have a Memorandum. A large number of early-stage companies use PPMs to raise their initial capital. Reg D financial rules do not require you to have a lot of assets and there are no minimums, in fact, many companies have losses and negative net worth. Remember, Regulation D Private Placements are disclosure documents and as long as you disclose your financial conditions, you are complying with the regulations. The investors make the investment choice knowing all the facts about the project, including financial conditions, prior to making their investment. While banks are reluctant to lend to start-ups, private investors like early-stage deals where they have the opportunity to obtain substantial returns.Will my document conform to all regulations?
Your Template Package guides you through all the necessary rules and regulations and tells you what information you need to furnish. This is a very comprehensive Template and you can pick and choose among many different clauses to fit your particular situation. The Template has been developed over 10 years to make it as simple as possible for you to conform it to your business.What else will I have to do after filing in the information in the Document Template?
You will have to file what is known as a "Form D" after your first sale of securities. Form D is a brief four-page notice that includes the names and addresses of the company's owners and stock promoters, and brief financial information on the company offering. A copy of Form D with complete instructions is included in the Package. There is no cost for filing the Form D.
Company needs to raise $970,000 by selling interest in its Corporation
Company needs to raise $3,500,000 and will pay it back in its LLC
Company needs to raise $8,000,000 and will pay it back in its Corporation
Company needs to raise $25,000,000 by selling interest in its LLC
Instructions:When you Click the "Buy Now" button; you will be redirected to PayPal where you will have the options to pay with a credit card or your PayPal account. After making the payment you will be sent to a download page on our website. If this does not occur it's because you either closed the window before the redirection could occur or your antivirus software prevented the redirection.
If this does occur, simply email us at info@REGD4U.com and we will send the document/s you ordered by email within 24 hours. We appreciate your patience with us if this does occur. If you have any questions, please do not hesitate to contact us.
Go to Order Page
By using the Products of RegD-4U (herein RegD-4U), the Purchaser agrees to the following:
Product:RegD-4U agrees to provide to Purchaser the product(s) listed on the online Order page of this website. These Products are hereinafter referred to as Product's. Purchaser agrees that RegD-4U will provide a specific Product or Products for download and/or email delivery to the Purchaser.
One Time Use:RegD-4U hereby grants to Purchaser a ONE TIME use of its Product. The purchase and payment of the Product/s gives the Purchaser a license to utilize the Product on a ONE-TIME use for the creation of ONE securities offering. Purchaser shall not resell or utilize the Product/s documentation, or language from RegD-4U source materials for additional transactions. Purchaser's use of the Product constitutes acceptance of this Product agreement and all of the terms and conditions contained herein. Purchaser hereby agrees not to compete, directly or indirectly, with the business of RegD-4U for a period of three (3) years following the purchase of any Product/s.
Payment for Product/s:All payments must be made in advance by purchasing such Product/s via the approved payment method in the secure shopping page of this website. If payment is declined, the order will not be available for download.
Product Refund Policy:When a Purchaser's order is received, the Products are sent from our internet server for immediate download. If Purchaser is not able to download Product/s due to their security software or firewall, Purchaser may request by email to receive Product/s via email. Once that a download is complete or email is received and replied to with delivery of the Product/s, refunds are NOT given.
Purchaser Responsibility for Compliance:The Purchaser is solely responsible for compliance with all applicable Federal and State securities laws and for ensuring that full and proper disclosure has been made to investors via the offering documentation. RegD-4U does not engage in due diligence on Purchaser's behalf to ensure all pertinent information related to the company and its security offering has been disclosed via the offering documents. RegD-4U is not a broker or dealer of securities nor registered with any Federal or State regulatory authority. The information contained in the Product/s should NOT be construed as tax or legal advice. Purchaser is advised to consult with attorneys and/or accountants for their review of all documentation.
Purchaser Indemnification:Purchaser hereby indemnifies, defends and holds RegD-4U harmless from and against any and all liability and costs incurred by the Indemnified Parties in connection with any claim arising from the utilization of the disclosure documentation provided through the Product/s.
All information on this site and in the template documents provideded by Regd-4U is provided for information purposes only and the information does not constitute legal advice but the generally accepted information regarding the development of private placement memorandums. RegD-4U is not a legal firm and users are encouraged to have accounting, legal and other experts review all documents prior to distribution.
Governing Law, and Arbitration:The laws of the State solely designated by RegD-4U shall govern this Agreement. In the event of any dispute between the parties, both parties agree to resolve them through the auspices of the Arbitration Association in the State so designated. Any award shall be final and conclusive upon the parties.
Modification or Amendment:No amendment, change or modification of this Agreement shall be valid unless in writing signed by the parties hereto.
Entire Agreement:This constitutes the entire agreement between RegD-4U and Purchaser. Access to and use of the Product/s constitutes complete agreement to and acceptance of the terms and conditions of this Product Agreement.
RegD-4U IS NOT RESPONSIBLE FOR ANY ACTIONS TAKEN BASED ON THE APPLICATION, EXECUTION, IMPLEMENTATION OR USE OF THE PRODUCTS.
RegD-4U reserves the right to change or modify website content and pricing of all Products without notice.
As a visitor to this Site, you can engage in many activities without providing any personal information. We are committed to protecting the privacy of our customers and do not disclose private or proprietary information about our customers to the general public.
Any information that is collected is strictly confidential and is not shared with any outside party unless we have written approval from our customers. We do not maintain an email list for third parties nor do we make the email addresses of our customers available to any third parties. We treat all personal account information with privacy and do not sell or distribute customer account information.
If you choose to order products on the Site, you may be asked to provide credit card information. For example, you may need to provide the following information: name, mailing address, email address, name on credit card, credit card number, credit card billing address, business and home phone numbers.
We may disclose certain information when we have reason to believe that such disclosure is required by law. This may occur in connection with a legal process, court order or other judicial administrative investigative proceeding that produces a legal request. We may disclose aggregate information compiled from our customers that does not identify the customer individually or personally. We adhere to the principles set forth by the United Sates Department of Commerce as regards the collection, retention and use of personal information from the European Union.