Investment Agreements
Private Placement
   Memorandums
​Investment Agreements
In addition to issuing a private placement memorandum (or some other similar offering memorandum), the business also needs an investment agreement (sometimes called a subscription agreement). While the PPM provides a lot of disclosures and helps to protect the business and its principals if things don’t work out, the investment agreement is the actual contract between the business and the investor. The investor promises that they are, in fact, sophisticated or accredited investors; they understand they can potentially lose their entire investment, and they agree to pay $X. In exchange for the investment, the business is promising to give the investor the actual securities, i.e., an equity interest in the business or, in some cases, a form of debt owed by the business. 

In addition to the investment agreement, investors who are receiving an equity interest in the business (whether that’s membership interests in an LLC or stock in a corporation) are usually also provided with the company’s  operating agreement  or corporate shareholder agreements to sign. 
Investment Agreement: $1,050

Note: A standalone investor agreement (without an accompanying offering document) is rarely, if ever, appropriate. All securities transactions are subject to the anti-fraud provisions of state and federal securities laws. This means that the business and its principals cannot make any false or misleading statements, whether orally or in writing, about the business, the securities offered, or the offering itself. In addition to government criminal, civil and/or administrative enforcement actions, the investors in a business can bring a private action for securities fraud and potentially recover a refund of their entire investment. The offering document not only helps to document your compliance with securities laws, but it's the best record of exactly what the business and its principals told potential investors.