PPM (Private Placement Memorandum)

A private placement memorandum (PPM) is the main disclosure document in a private securities offering. It is what the issuer hands prospective investors so they can understand - and are legally told about - what they are buying and what could go wrong.

A typical PPM covers:

• the company or deal and the use of proceeds,
• the terms of the securities being offered,
• detailed risk factors,
• management or sponsor background,
• financial information, and
• the subscription procedure and investor eligibility.

No single SEC rule says "you must write a PPM." Its real job is to protect the issuer against antifraud liability under Rule 10b-5: by disclosing the material facts and risks fully and accurately, the issuer reduces the chance that an investor can later claim they were misled. That is why a PPM is standard practice for a private placement under Regulation D, especially a Rule 506 offering.

"PPM" and offering memorandum are often used interchangeably; "PPM" is the common US term for private deals.

For a tokenized offering, the PPM describes the token itself - what legal claim it represents, how distributions flow, the transfer and lock-up restrictions, smart-contract and custody risks - and is paired with a subscription agreement the investor signs. A PPM is only as good as the accuracy of its disclosures, which are specific to each deal.

Source: U.S. SEC (sec.gov), as of 2026.