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Questions and Answers > EB-5 Requirements

Do I need to place a private placement memorandum (PPM) for my EB-5 visa?

I am intending on submitting a direct EB-5 project. My attorney informed me that a PPM is required to meet the SEC exemption requirement. However, I am not offering to sell securities to any other foreign investors. I am the business owner and the only investor in my project. Do I still need to submit the private placement memo and claim exemption with the SEC?

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Answers

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    Roberto Ortiz

    Immigration Attorney
    Answered on

    You do not have to do a PPM as this is your own investment and you are note offering it to anyone. Thank you.

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    Michael A Harris, Esq

    Immigration Attorney
    Answered on

    You need to consult with a qualified securities attorney, most definitely. Even if they are just foreigners (who will become U.S. residents, and perhaps citizens!) I believe you will still need to avail yourself of SEC Reg S in order to protect your offering''s exemption from registration under U.S. law.

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    Lei Jiang

    Immigration Attorney
    Answered on

    Yes. If you want to recruit foreign investor, this is needed. Please feel free to contact us for your EB5 questions.

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    Julia Roussinova

    Immigration Attorney
    Answered on

    You should not need PPM based on the facts presented. However, I recommend you consult an experienced securities attorney for a second opinion.

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    Fredrick W Voigtmann

    Immigration Attorney
    Answered on

    No, you do not need a PPM.

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    Rakesh Mehrotra

    Immigration Attorney
    Answered on

    Private placement memorandums (PPM) are documents drawn up between those seeking capital, for instance EB-5 Regional Centers, and investors. PPMs outline the requirements and potential financial risks that investors face in making an investment to a particular business. The PPM then protects the business that received the investment if the something goes wrong during the course of the investment. Businesses seeking Regional Center designation must submit a sample PPM to the USCIS. Thus if you are not seeking foreign investors on the face of it, it appears that you do not need a PPM. However, you should ask your attorney why he thinks that a PPM should be submitted and see if you get a credible answer. Without knowing the details of your business plan I do not want to state that your attorney is wrong.

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    Elizabeth Krukova

    Immigration Attorney
    Answered on

    It is not clear what is the reason your attorney is requiring you to submit a PPM memorandum. You are the only investor, you are not offering securities to the public, you should be exempt from this requirement.

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    Ed Beshara

    Immigration Attorney
    Answered on

    First, please obtain advise from an experienced Securities attorney in EB-5 regulations and policies. Second, based upon the fact you are investing in your own business I don''t believe you need to submit a PPM.

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    Clem Turner

    Securities Attorney
    Answered on

    Private Placement Memorandums (or PPMs) are necessary to reduce liability under the Anti-Fraud provisions of Section 12(a)(2) of the Securities Act and Section 10(b) (and Rule 10(b)(5)) of the Exchange Act. They are not required to meet the criteria of any exemption, though Regulation D does place mandatory disclosure requirements on an offering if there are unaccredited investors participating. However, as you are the only investor, your exposure from an investor suit is non-existent. You should seek experienced Securities Counsel and get a second opinion.

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    Michael E Piston

    Immigration Attorney
    Answered on

    There is no requirement that you prepare a private placement memorandum if you are making the sole investment and not selling anything to anyone else. The securities laws apply to the sale of securities. If you are not selling anything, then you don''t need to prepare a private placement memorandum or be concerned about the securities laws. Having said that, I suspect there is more going on here than meets the eye. Your attorney may have some good reason for his advice which is not apparent from your question. The best way of getting a definitive answer to your question is to ask your attorney to provide you with a written opinion explaining his reasons for believing that you need to prepare a private placement memo and take it to another attorney for a formal second opinion.

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    Jinhee Wilde

    Immigration Attorney
    Answered on

    If you are not selling securities and you are investing to own and operate your own business, you do not need to go through the SEC regulations at all.

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    Philip H Teplen

    Immigration Attorney
    Answered on

    If you have no investors, you do not need at PPM or registration. I suggest that we chat so that you clearly understand the requirements.

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    Reza Rahbaran

    Immigration Attorney
    Answered on

    No you do not need a PPM. For further information please contact Rahbaran PLLC.

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    Boyd Campbell

    Immigration Attorney
    Answered on

    You do not need a PPM, but you do need a detailed EB-5 compliant business plan.

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    Kenneth Byrd

    Immigration Attorney
    Answered on

    Respectfully, your attorney is mistaken. I have helped many clients with their direct investment to their EB-5 project, and the biggest is always the source of funds. A PPM is not required in a case such as yours.

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    Neville M Leslie

    Immigration Attorney
    Answered on

    Yes, you will need a private placement memorandum (PPM).

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    Steven Anapoell

    Securities Attorney
    Answered on

    Generally, the business that issues you securities will provide you with a private placement memorandum and related offering documents that will be filed with your EB-5 Petition.

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    Shahzad Q Qadri

    RC Creator
    Answered on

    No, unfortunately your attorney is mistaken. A PPM is used where there are multiple investors purchasing a share, the fact that you are the sole investor in your project, I am assuming you are not utilizing the RC program but a direct ''EB5'' program. You are not required to have a PPM.