Business restructuring is a process of reorganizing a company, which may be implemented for a number of different reasons such as positioning the company to be more competitive or moving the business toward an entirely new direction. Restructuring a business entity is often needed when the company has grown so that the original structure can no longer efficiently meet the goals of the company. For example, a business restructuring may spin off some departments into subsidiaries to create a more effective management model.
When business owners are in need of financing for their business they usually turn to family, friends, or private investors for funding. Whenever the business raises money through these channels, it needs to provide a document called a Private Placement Memorandum (PPM). A PPM is a disclosure document that is heavily regulated by the Securities Act. For businesses, the PPM is a critical piece of document because it provides a safety back-up against potential claims by investors.