Hey, what is this place? Some sort of "web log" thing it seems. I vaguely remember being here before. Hi there! It's been over a month since I last posted! That's dumb! So are all of these exclamation points! There's another one! Crap.
Well, we're officially in that phase I call "Write Checks to Lawyers". In this phase, you get out your check book, write large numbers on the checks inside it, and make the checks out to, um, lawyers. Well, "lawyer", not "lawyers". I can barely afford one.
So what's this all about? Well, good question. I'll explain as best I can't 'cause I ain't no lawyer (but today I wish I was). Primarily, the things I'm getting out of this lawyer stuff are an Operating Agreement (OA), a Private Placement Memorandum (PPM), and a Subscription Materials (SM) document (I think). That sounds exciting, doesn't it?!
The OA (I'm not typing "operating agreement" a million times) is a legal document which defines how an LLC will operate including managerial rights (that's me) and members' rights (maybe that's you?). I should backtrack a second here. An LLC, limited liability
corporation company, which is Panic's (now named Alarmist) chosen business entity, has members. Those members are me and anyone else I let be a member. The people I will let be a member are my wife (she'd kill me otherwise), Charlize Theron* (never mind, my wife will kill me anyway), and anyone who buys into the Panic Alarmist private equity offering. The OA protects me, my wife, and Charlize if things go wrong, and it protects the investing members by letting them know exactly how Panic Alarmist will operate. This includes things like how profits will be handled, who calls the shots (me and Charlize if she wants to), how taxation works, etc. The OA is all about covering our collective asses. There should be another Charlize Theron joke in that last sentence, but my wife might read this. That's all I know about the OA for now. Google it for far more information than I can provide.
The PPM is a different animal altogether. A PPM is more about informing would be investors of the potential risks involved if they decide to join me, my wife, and Academy Award® winning actress, Charlize Theron in this venture. It's another ass covering legal document that gives full disclosure of what the business is, what the financial projections are, what the value of a share is, how to invest, and much more. A large portion of the
Panic Alarmist Brewing business plan will be in the PPM for potential investors to read and ingest.
Finally, there is the Subscription Materials document. This is an application, along with a check, that the investor signs in order to apply to become a member/investor in the LLC. It contains lots more legal mumbo jumbo and requires the applicant to answer various questions about themselves. Again, another covering of the ass.
Once all of the legal docs are completed, I'll be rounding up investors. I have several ready to write checks, but I'll need more. The documents will explain how I'll put all investment cash into an escrow account where it will stay, untouched, until a certain funding level is reached. Once that level is reached, the money will be available for
Panic Alarmist to use.
It's important to point out that I'm just writing about what little I know thus far. Do not take any of this as gospel. The above paragraphs may have glaring errors so please don't rely on me for any legal advice. Use this as one tiny data point in a much larger universe of research you'll need to do.
So that's where we are. I should have a better idea of the timeline soon for document completion.
*Full disclosure: Charlize Theron is not a member of
Panic Alarmist Brewing, LLC, but a man can dream, can't he?