NASD expels Bethesda firm
The National Association of Securities Dealers expelled Lux Investors Services of Bethesda from membership for what it charged were violations of securities laws and the agency's regulations.
Lux Investors and principal John Ernst Lux were jointly fined $100,000 and ordered to pay $10,191 in restitution for, among other things, not maintaining required minimum net capital, according to the NASD, the self-regulatory organization for the securities markets.
The regulator also said the firm, acting through Mr. Lux, bought stock for an account in which it had a beneficial interest; effected transactions with customers at unfair prices; and failed to accurately disclose markups.
The firm and Mr. Lux agreed to be barred without admitting or denying wrongdoing.
http://articles.baltimoresun.com/1994-08-16/business/1994228142_1_lux-outlet-center-martin
The Rocket Ride – Using Venture Financing for Unlimited Growth
______
What is a Rocket RideÔ?
A Rocket Ride is simply ultra-fast company development – from start up to $100 million valuation or more in one to two years.
The Rocket Ride achieves this in a set of integrated and seamless steps. You use techniques that individually are well known – seed money, venture capital, going public – but in the Rocket Ride are all part of one path to provide the fastest possible company development, not simply a botched mess of separate transactions with the partner who is most convenient at the time.
Starting with the concept, the company is positioned for its growth into an exit strategy. Possible strategic buyers are studies as to their needs and what they would find most valuable. The public securities markets are studied as to what would bring the best market value as an IPO. These items are integrated into the concept and the growth plan.
From the ground floor, the company has to be set up right. That means using sophisticated legal documents that set the company up to go public or be sold from the very beginning.
To create one seamless process, you need to craft the founding documents, the articles of incorporation, the by-laws, the incentive plans, the employment agreements, and the corporate governance rules with an eye toward the exit strategy, whether it is going public or a sale to a strategic buyer.
The growth plan and each stage of financing can then be planned. However, planning is not enough. Everyone has a good plan; it is execution that separates the dreamers from the successful.
When you have the plan, the need for management talent for the team will be easy to see.
History of the Rocket Ride
My work in the investment business started out on the OTC trading desk where all kind of stocks – from the wild penny speculations to the stodgy rust-best manufacturers – were traded. More importantly, this is where most companies that were going public started to trade.
Moving up to Vice President of Trading for an New York investment bank, I not only made markets in our IPOs and the public offerings of the other houses, I had to read the prospectuses and attend all the dog and pony shows.
As you can imagine, it was case study after case study in venture companies, their development and financing. It was also an education into what investor will avoid and what they buy.
As I become an investment banker, I developed more and more techniques for venture companies, and that lead inevitably to my starting to run them.
Make no mistake, this was the school of hard knocks – you get spanked hard if you are doing something that does not work and you find out what works and what works like crazy.
Eventually, this transformed into the idea of one process, not one disjointed transaction after another.
The limiting factor in the growth of most companies is their own decisions. In the beginning, the company has infinite potential. Bad decisions build in the limits to growth. It takes experience to build a strategy that can take you all the way.
My experience tells me that the Rocket Ride is for you if:
· You have a public or private venture company
· You have an overwhelming desire to succeed
· You are always optimistic
· You are wildly impatient
· You are a fanatic about your company
· You are a visionary
· You are tenacious
· You are willing to work hard to get results
· You are demanding of others
· You put your business first, knowing success will give you all the rewards you want
· You are willing to share the fruits of your efforts with others
· You are a leader
· You are willing to do whatever it takes to get the job done, and done on schedule
· You secretly have your corporate logo tattooed on your arm
· You want to grow your company at the fastest possible rate
The steps in the Rocket Ride are done by a team. Management is expert in its core business, but may not have either the expertise or the time needed to take Wall Street by storm. To develop the company fast, a team must perform all the needed functions and support management’s developing the core business in the fastest way.
The first financing is seed capital. Then more rounds of financing. Timing these rounds to minimize dilution is critical. Then, the major financing.
One of the benefits of doing this right is that none of the work has to be done over to prepare for going public or the sale of the company. This minimizes the use of management time. Management has to work on the core business. The money has to be there when it is needed, leaving management to focus on what they really do. Finance is, after all, only a support function.
Finally, the exit strategy. You are going public or selling out to a strategic buyer. If this is done right, the company is prepared from day one for presentation to many strategic buyers, perhaps in an auction. The strategic buyers have been suitably educated as to the key importance o the company to maximize the price.
If the company is going to go public, there is the process of finding an underwriter, valuing the company, negotiating terms, and marketing the issue. The process does not end there as the company must do well in the aftermarket trading to so the founders can cash out or not and can look back, with a great deal of satisfaction on the whole trip as a true success. That is what you truly want, isn’t it?
Would you like to learn more about the Rocket Ride? The only way to do this is to visit the author, John E. Lux at mailto:lux.investor@gmail.com
John Lux – former OTC market maker, investment banker, attorney, venture CEO, author of “How to Find a Home Run Stock,” and host of TV show “The Wall Street Insider with John Lux.”
Send mail to mailto:lux.investor@gmail.com with questions or comments about this web site. Reverse Merger Info Copyright © 2006 John Lux Last modified: November 30, 2008
Contact John to have all your questions answered about reverse mergers without obligation in a friendly, relaxed manner.
mailto:lux.investor@gmail.com
http://www.reverse-merger.info/the-rocket-ride.htm
http://www.zoominfo.com/Search/PersonDetail.aspx?PersonID=338857240
http://www.law.umaryland.edu/marshall/schoolarchives/documentspriv/CommencementDayExercises1975.pdf
http://www.articlesbase.com/authors/john-lux/98881
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