Information Memorandum Disclaimers: What You Need To Know

Raising capital is exciting, but it also brings legal and commercial risk if your documents aren’t prepared properly.

One of the most important documents you’ll deal with in a private capital raise is an Information Memorandum (IM). And at the heart of a well-drafted IM is a clear, tailored disclaimer that helps manage risk and set expectations.

In this guide, we’ll walk through what an IM disclaimer is, what it should include, what it can’t do under Australian law, and practical steps to prepare your IM and disclaimer the right way.

What Is An Information Memorandum In Australia?

An Information Memorandum is a document used to present a business and its offer to potential investors in a private (non-prospectus) capital raise. It typically outlines the company’s business model, financials, strategy, risks, terms of the offer, and relevant legal information.

IMs are most commonly used in offers that rely on disclosure exemptions under the Corporations Act 2001 (Cth). These are often called “small scale” or “s708” offers. If you’re unfamiliar with these rules, it’s worth reading about section 708 of the Corporations Act and how it allows certain offers to proceed without a full prospectus when strict criteria are met.

Because an IM is a marketing and disclosure document, you must ensure it is accurate, not misleading, and fits within the relevant legal exemption. Even in private raises, the general prohibitions on misleading or deceptive conduct still apply.

If you’re just getting started, it can help to step back and plan your capital raise from end to end - for example, clarifying your investor profile, deciding how much to raise, and choosing the right instrument (shares, SAFE, convertible note, etc.). Our overview on capital raising for startups is a useful primer.

What Is An Information Memorandum Disclaimer?

An IM disclaimer is a dedicated section (often at the front and repeated at the back) that sets boundaries around how the document should be used. It tells readers what the document is and is not, and it helps limit your legal exposure by clarifying key points such as:

• the IM isn’t personal financial product advice
• the offer is made only to certain classes of investors and is not an offer in jurisdictions where it would be unlawful
• the information is based on assumptions and subject to change
• recipients must do their own due diligence and rely on their own enquiries
• no representation or warranty is given as to accuracy or completeness (to the extent permitted by law)
• no liability is accepted for loss arising from reliance (again, to the extent permitted by law)

A well-crafted disclaimer won’t replace accurate disclosure, but it does provide context and helps manage how recipients treat your information. It’s also common to pair the IM with a controlled distribution process (for example, via a secure data room) and a Non-Disclosure Agreement so you can share detailed materials while protecting confidentiality.

Because disclaimers need to be tailored to the structure of your offer, your investor audience, and the law that applies to your business and industry, it’s wise to use a purpose-built Information Memorandum Disclaimer rather than copying boilerplate text from another document.

What Should Your IM Disclaimer Include?

Your IM disclaimer should be specific, plain-English and consistent with the rest of your document. Common elements include:

1) Nature Of The Document And Offer

• State that the IM is for information only and is not a prospectus or product disclosure statement.
• Confirm that it does not purport to be comprehensive and is not personal, legal, tax or financial advice.
• Explain the basis of the offer (e.g. reliance on a Corporations Act disclosure exemption) and that it’s only intended for recipients who qualify (for example, sophisticated or professional investors under the Act).

2) Distribution Restrictions

• Identify where the IM may lawfully be distributed (e.g. in Australia) and prohibit circulation in jurisdictions where offering would be unlawful.
• Confirm that acceptance of the IM constitutes an acknowledgement of these restrictions.

3) Reliance And Independent Advice

• Make clear that recipients should conduct their own investigations and obtain independent professional advice.
• Note that any forward-looking statements are based on assumptions and are subject to risks, uncertainties and change.

4) Accuracy, Updates And No Duty To Correct

• Confirm the information is current as at the date of the IM and may change without notice.
• Reserve the right to update, amend, or withdraw the offer at any time.

5) Liability

• Include a qualified no-reliance statement and disclaimers of responsibility or liability to the maximum extent permitted by law.
• If advisers (e.g. legal or financial advisers) are referenced, include language clarifying they owe no duty to recipients and are not making any representation.

6) Confidentiality And Use

• Mark the IM as confidential and state that it must not be reproduced or shared without consent.
• Where appropriate, condition access to the IM on acceptance of confidentiality terms (this is often backed by a separate Non-Disclosure Agreement and a controlled data room).

7) Privacy And Personal Information

• If you collect personal information during your raise (for example, expressions of interest or investor KYC), reference your Privacy Policy and how information will be handled under the Privacy Act 1988 (Cth).

8) Document Ancillaries

• Flag that more detailed terms (for example, a Term Sheet or subscription documentation) will govern any investment and that the IM is not itself an offer capable of acceptance.

Finally, ensure your disclaimer language aligns with the rest of your IM. For example, if the IM says the offer is only open to certain investor types, the body of the document and any application form should reflect that.

What A Disclaimer Can’t Do Under Australian Law

Disclaimers are powerful risk-management tools, but they’re not magic words. There are clear limits under Australian law you need to respect.

It Can’t Excuse Misleading Or Deceptive Conduct

The Australian Consumer Law (ACL) and the Corporations Act prohibit misleading or deceptive conduct in trade or commerce and in relation to financial products and services. A disclaimer can’t cure statements that are false, incomplete in a misleading way, or lacking reasonable grounds (for forward-looking statements).

In practice, this means you must carefully verify your content, include balanced risk disclosures, and ensure projections are clearly labelled with the assumptions that support them. A clear statement that you don’t guarantee outcomes does not permit over-optimistic, unsubstantiated claims.

For context on how the ACL operates for businesses, see the overview of section 18 and related provisions that deal with misleading conduct.

It Can’t Expand Your Investor Pool Illegally

If you rely on an exemption under the Corporations Act, a disclaimer can’t transform a non-compliant public offer into a compliant private one. Ensure your process matches the exemption-this includes who you approach, how many offerees you have in a rolling 12-month period, and how you verify eligibility (e.g. certificates for sophisticated investors). For offers that rely on the “small scale” pathway, section 708 sets out detailed criteria you need to manage closely.

It Can’t Override Specific Legal Duties

Directors and officers owe duties under the Corporations Act and general law. A disclaimer does not negate those duties or other statutory obligations (for example, prohibitions on hawking or advertising certain offers). Make sure your capital raising process is designed with these obligations front-of-mind.

It Won’t Save A Poor Process

Even a great disclaimer won’t fix a broken process-for example, uncontrolled sharing of documents, inconsistent messaging across emails and pitch decks, or missing application terms. Align your IM, investor communications, and deal documents so they tell the same accurate story.

How To Prepare An IM (And Disclaimer) The Right Way

Here’s a practical, step-by-step approach to help you prepare your IM and disclaimer safely.

1) Map Your Raise And Investor Profile

Decide how much you want to raise, the type of instrument you’ll use (equity, SAFE, convertible note), and who you’ll approach. Match your strategy to the relevant legal pathway (for example, a small-scale personal offer to sophisticated investors). If you’re not sure which route suits your plans, speak with a lawyer early-this can save you time and pivots later.

2) Control Access And Confidentiality

Before circulating sensitive materials, put a confidentiality process in place. That usually means sending NDAs to prospective investors and hosting documents in a secure data room with access logs and watermarks. Having a clear Non-Disclosure Agreement in place also helps you share operational and financial information confidently during due diligence.

3) Draft Your IM With Accuracy And Balance

Build your IM around accurate, supportable information.

• Use conservative, clearly labelled assumptions for forward-looking statements.
• Include a balanced risk section-think market, product, supply chain, technology, regulatory and key personnel risks.
• Make sure financials and metrics are sourced and date-stamped (e.g. “management accounts as at 30 June 2025”).
• Keep version control tight so you don’t accidentally circulate conflicting drafts.

Where relevant, ensure your corporate governance and documentation support the raise. For example, if there are multiple founders, a current Shareholders Agreement and board approvals help align internal decision-making with the deal timeline.

4) Insert A Tailored Disclaimer

Use a disclaimer that’s consistent with your raise structure, distribution plan and investor eligibility criteria. Off-the-shelf disclaimers often miss key details or include statements that don’t fit your offer.

It’s often best to use a tailored Information Memorandum Disclaimer drafted to your transaction rather than copying a precedent from another business or industry.

5) Align Your Deal Documents

The IM is a high-level overview; the binding terms live in your transaction documents. Make sure your IM aligns with your Term Sheet and the final Share Subscription Agreement (or other instrument). If there’s a gap between the IM and the binding documents, the risk of confusion-and disputes-goes up.

6) Prepare A Q&A Script And Keep Communications Consistent

Investors will ask follow-up questions. Nominate a single contact person, keep a log of Q&As, and ensure your answers are consistent with the IM. If you update material information, consider whether you should issue an update or revised IM and note the change in your data room index.

7) Manage Personal Information And Security

Capital raises often involve collecting names, emails, identity documents and bank details. Handle this data under your Privacy Policy and restrict access to people who need it. Use secure channels for application forms and payments to reduce risk for you and your investors.

8) Get A Legal Review Before Circulating

Finally, have a legal expert review your IM, disclaimer and process for compliance risks and alignment with your specific exemption strategy. A short review at this stage can remove ambiguity and highlight issues before they become costly.

Key Takeaways

• An Information Memorandum is a private capital raising document-its accuracy and balance are critical, and a clear disclaimer helps manage risk and expectations.
• Your IM disclaimer should cover the nature of the document, distribution restrictions, independent advice, updates, liability, confidentiality and privacy, and it must align with your specific offer.
• Disclaimers have limits: they can’t excuse misleading or deceptive conduct, make a non-compliant offer compliant, or override statutory duties-your process still needs to be robust.
• Control document access, verify your data, align your IM with your Term Sheet and Share Subscription Agreement, and keep all investor communications consistent.
• Support your raise with the right legal documents, including a tailored Information Memorandum Disclaimer, a Non-Disclosure Agreement, and a current Shareholders Agreement.
• Getting advice early-especially on exemptions under section 708 and your disclosure approach-will help you raise capital confidently and compliantly.

If you’d like a consultation about preparing your Information Memorandum and disclaimer, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.