Example of Syndication Contract

[Steven Kleppin]

Hello. Is anyone able to provide an example syndication contract they have successfully used? I've checked the files section, and have done some searching through the forums but haven't see anything. Thank you.

[Kim Lisa Taylor]

Tread carefully here. Syndication is not a DIY area of the law, and there isn't a single document that could be called a "syndication contract" as the offering package generally contains a group of documents, all designed to work together, including required disclosure documents (depending on your investors' financial qualifications), your "investment contract" (which could be an LLC operating agreement, a limited partnership agreement, a JV agreement, a note, or other such instruments, which must be carefully drafted to protect you); a subscription agreement (where the investor basically accepts the risk of investing) and the required federal and state securities notice filings.

Further, there are a lot of nuances and decisions that must be made before you start drafting, both with respect to securities laws, state laws pertaining to your investment contract, and tax implications. Also, if you do it wrong and your investors lose money, you don't have much protection with self-drafted documents, nor do you have a securities attorney with malpractice insurance that drafted the documents to back you up. If you do draft your own docs (not advised unless you are very well versed in doing this), it would be prudent to consider having a securities attorney review them. 

Not hiring a securities attorney to advise you and draft your documents can cost you much more if you end up hiring one later to get you of a situation you inadvertently created.