EB-5 Private Placement Memorandum

Project ownership, location, development, financing, business activity, NCE and JCE should align with the immigration filing.

A private placement memorandum should describe the same project that the regional center presents to USCIS in Form I-956F. Current I-956F instructions require the regional center to submit all investment and offering documents, including the PPM when one is used. Project ownership, the new commercial enterprise, job creating entity, location, business activity, financing, use of proceeds, development schedule, and material agreements should therefore align with the business plan and project filing. If the PPM was prepared before later project changes, amendments or supplements should explain those differences so the investor facing disclosures and immigration record do not tell materially inconsistent stories.

I-956F approval, investor petition approval, visa availability, job creation, and I-829 are separate stages.

The PPM should describe immigration risks accurately and avoid converting conditional expectations into guarantees. Form I-956F approval, investor petition approval, visa availability, adjustment or immigrant visa processing, job creation, sustainment, and Form I-829 adjudication are distinct stages. A regional center or issuer cannot guarantee that USCIS will approve an investor's immigration benefit. The document should also distinguish project eligibility from investor specific issues such as lawful source of funds or admissibility. Clear immigration risk disclosures help prevent marketing summaries from overstating what project approval means and should remain consistent with the representations made in subscription documents and other offering materials.

The PPM should not promise guaranteed repayment or a guaranteed rate of return inconsistent with EB-5 requirements.

EB-5 capital must satisfy the applicable at risk requirements, so the PPM should not give an investor a contractual right to guaranteed repayment or a guaranteed return that conflicts with the immigration structure. The offering should accurately explain distributions, repayment priorities, redemption provisions, maturity expectations, exit assumptions, and the possibility of loss. Immigration counsel should compare those provisions with the governing agreement and NCE to JCE financing documents. A projected repayment date can be described as an expectation when supported, but the documents should not transform that expectation into an unconditional obligation to return capital regardless of project performance or governing EB-5 requirements.

The offering should accurately describe the job model, investor capacity, job cushion, and major assumptions.

Job creation disclosures should match the economic report and the investor capacity of the project. The PPM should accurately describe the methodology, principal economic inputs, total projected jobs, anticipated investor count, and any job cushion. If construction expenditures, operating revenues, or direct employment are essential to the model, the description should be consistent with the business plan and financing. Later changes in project scope or budget can affect the job calculation and may require updated disclosures. Marketing language should not present a projected job cushion as guaranteed when the result depends on expenditures, timing, revenues, construction duration, or other variables that can change.

Current I-956F asks about conflicts among the regional center, NCE, JCE, principals, attorneys, recruiters, and other participants.

Current Form I-956F requires detailed information regarding fees, compensation, promoters, conflicts, and the policies used to monitor compliance with securities laws. The PPM should therefore disclose material relationships and compensation consistently with the project application and other offering records. Relevant parties may include the regional center, NCE, JCE, principals, managers, promoters, finders, broker dealers, migration agents, and other persons receiving transaction based compensation. The purpose is not merely formal disclosure: undisclosed economic relationships can affect investor understanding and USCIS program integrity review. Securities counsel should address separate regulatory obligations when the offering presents those issues.

• Business plan
• Economic report
• Subscription agreement
• Operating or partnership agreement
• Loan or equity agreement
• Capital stack
• Marketing materials
• I-956F responses

A PPM review should be performed against the complete project record rather than as a stand alone document exercise. Compare the PPM with the subscription agreement, operating or partnership agreement, NCE to JCE loan or equity documents, business plan, economic report, capital stack, marketing materials, Form I-956F responses, and later amendments. Check entity names, investment amount, administrative fee, use of proceeds, repayment terms, management rights, job assumptions, location classification, and compensation disclosures. Any inconsistency should be resolved or explained before filing or investor subscription when possible. A coherent record reduces both immigration ambiguity and the risk that investors received materially different project information.