Part II
OFFERING CIRCULAR
ENTREX MARKET INDEX, LLC
150 E Palmetto Park Road
Suite 800
Boca Raton, FL 33432
Best Efforts Offering of up to 2,000,000 ?TIGRtoken? Equity
Securities
Minimum Purchase: 1 Unit ($10)
This prospectus relates to the offering and sale of up to Two
Million (2,000,000) TIGRtoken Equity Securities for an
aggregate, maximum gross dollar offering of Twenty Million
($20,000,000) Dollars (the ?Offering?). The Offering is being
made pursuant to Tier 1 of Regulation A, promulgated under the
Securities Act of 1933. Each TIGRtoken Equity Security will be
offered at Ten Dollars ($10) per unit. There is a minimum
purchase amount of One TIGRtoken Equity Security, at $10 per
unit for an aggregate purchase price of Ten ($10) Dollars.
Investing in this offering involves high degree of risk, and you
should not invest unless you can afford to lose your entire
investment: see ?Risk Factors?. This offering circular relates
to the offer and sale or other disposition of up to Two Million
(2,000,000) TIGRtoken Equity Securities, at Ten Dollars ($10)
per unit.
This is our offering, and no public market currently exists for
our TIGRtoken Equity Securities. The proposed sale will begin as
soon as practicable after this Offering Circular has been
qualified by the Securities and Exchange Commission (the ?SEC?)
and the relevant state regulators, as necessary and will
terminate on the sooner of the sale of the maximum number of
shares being sold, twelve months from the effective date of this
Offering Statement or the decision by Company management to deem
the offering closed. The shares offered hereby are offered on a
?best efforts? basis, and there is no minimum offering.
During which time this offering is being qualified by the
Securities and Exchange Commission we have a current Reg D
exempt offering being sold by principals of the company. When
and if this offering becomes qualified we shall cease the Reg D
offering and solicit this qualified Reg A Offering.
We have made no arrangements to place subscription proceeds or
funds in an escrow, trust or similar account, which means that
the proceeds or funds from the sale of securities will be
immediately available to us for use in our operations and once
received and accepted are irrevocable. See ?Plan of
Distribution? for a description of our TIGRtoken Equity
securities offering.
THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION DOES NOT
PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES
OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE
ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER
SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO
AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE
COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE
SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.
THE TIGRTOKEN EQUITY SECURITIES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE ?SECURITIES ACT?),
OR APPLICABLE STATE SECURITIES LAWS, AND ARE BEING OFFERED AND
SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF THESE LAWS. THE TIGRtoken EQUITY SECURITIES HAVE
NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE REGULATORY AUTHORITY NOR HAS THE
COMMISSION OR ANY STATE REGULATORY AUTHORITY PASSED UPON OR
ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY
OF THIS OFFERING CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
# of Price to
Proceeds to Proceeds to
Securities Public (2) Issuer (1)
others
Per Security 1 $10
$9.30 $0.70 Total
Minimum 1 $10
$9.30 $0.70
Total Maximum 2,000,000 $20,000,000
$18,600,000 $1,400,000
(1)
The amounts shown are before deducting organization
and offering costs to us, which include legal,
accounting, printing, due diligence, marketing,
consulting, finders fees, selling and other costs
incurred in the offering of the common stock.
(2)
The TIGRtoken Securities (TIGRtokens) are offered at
$10 per unit.
We are following the ?Offering Circular? format of disclosure
under Regulation A.
The date of this Amended Offering Circular is March 12, 2018
FORWARD LOOKING STATEMENTS
THIS OFFERING CIRCULAR MAY CONTAIN FORWARD-LOOKING STATEMENTS
AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY,
ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-
LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE
BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY?S
MANAGEMENT. WHEN USED IN THE OFFERING MATERIALS, THE WORDS
?ESTIMATE,? ?PROJECT,? ?BELIEVE,? ?ANTICIPATE,? ?INTEND,?
?EXPECT? AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY
FORWARD-LOOKING STATEMENTS. THESE STATEMENTS REFLECT
MANAGEMENT?S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE
SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE
COMPANY?S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE
CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING
STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE
MADE.
PART II
ITEM #2
TABLE OF CONTENTS
PART II?... ITEM 1?...SUMMARY OF OFFERING CIRCULAR ???????.?.??1
PART II?... ITEM 2?...TABLE OF CONTENTS ????????????????.?.4
PART II?... ITEM 3a?.SUMMARY OF INFORMATION IN OFFERING CIRCULAR
.........5
PART II?... ITEM 3b?.RISK FACTORS???.??????????????..???.9
PART II?... ITEM 4?...DILUTION?.???.??????????????????.14
PART II?... ITEM 5?...PLAN OF DISTRIBUTION ????.???????????...15
PART II?... ITEM 6?...USE OF PROCEEDS TO ISSUER?????..????????16
PART II?... ITEM 7?...DESCRIPTION OF BUSINESS?????????..?????18
PART II?... ITEM 8?...DESCRIPTION OF PROPERTY?????.????????...20
PART II?... ITEM 9...?MANAGEMENT?S DISCUSSIONAND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS?.21
PART II?... ITEM 10?.DIRECTORS, EXECUTIVE OFFICERS AND
SIGNIFICANT EMPLOYEES?????????????????.????.24
PART II?... ITEM 11?.COMPENSATION OF DIRECTORS AND
OFFICERS????...25
PART II?... ITEM 12?.SECURITY OWNERSHIP OF MANAGEMENT AND
CERTAIN SECURITYHOLDERS??????????.???27
PART II?... ITEM 13?. INTEREST OF MANANGEMENT AND OTHER CERTAIN
TRANSACTIONS?????????????????.??..28
PART II?... ITEM 14?. SECURITIES BEING OFFERED?????????????..29
PART F/S? ITEM 15?. HISTORICAL AND PROJECTED FINANCIAL
STATEMENTS .....???????????????????30
PART III?..ITEM 16?. INDEX TO EXHIBITS????..?????????????.33
PART III?..ITEM 17?. DESCRIPTION OF EXHIBITS?..?????????????34
PART III?..ITEM 18?. SIGNATURE PAGE??????..???????..??.??..35
PART II
ITEM 3a
SUMMARY OF INFORMATION IN OFFERING CIRCULAR
As used in this prospectus, references to the ?Company,?
?company?, ?we,? ?our?, ?us? or ?EMI? refer to ENTREX MARKET
INDEX, LLC. unless the context otherwise indicated.
You should carefully read all information in the prospectus,
including the financial statements and their explanatory notes,
under the Financial Statements prior to making an investment
decision.
The Company
Organization: We were incorporated as a Limited Liability
Company under the laws of the State of Florida on January 24,
2018. Our principal office is located at 150 E Palmetto Park Rd
Suite 800, Boca Raton FL, 33432.
Management: Our Managing Member is Stephen H. Watkins. Our
Vice Chairman is Rick Rochon. Our other Directors initially
include Alexander Adami and Erin Flaherty both who assist in the
operations of the Company.
Controlling Shareholder: Stephen H. Watkins is the controlling
shareholder and Managing Member.
Our Business
Description of Business: Entrex Market Index or EMI is the
composite index of the Entrex Capital Market. The EMI
purchases, as a holding company, up to 10% of each company that
issues patented revenue enhanced debt securities (trademarked
TIGRcubs) on the Entrex Capital Market System. The Entrex
Capital Market, or ?Entrex? was founded in 2001 as an
Entrepreneurial Exchange with the mission to be the leading
?Capital Market System for Entrepreneurial companies?. Entrex
focuses on $5-250 million annual revenue, cash-flowing
companies, via its Patented revenue enhanced debt security
called a TIGRcub. The TIGRcub simplifies investing in this
sector of companies by avoiding equity valuation issues and
liquidity by simply providing a debt structure which may have a
base interest rate and a small slice of revenue distributed to
the TIGRcub holder on a monthly basis. This methodology provides
monthly yield to investors ? with the potential of enhanced-
yield through revenue participation. Through the establishment
of monthly yield the TIGRcub can be valued on a Net Present
Value basis.
Description of Operations: The Entrex Market Index, as a holding
company, decides which company?s TIGRcub Securities to purchase
which issue securities on the Entrex Capital Market. The Entrex
Market Index?s monthly GAAP Gross Revenues are distributed by
Issuing companies to the Entrex eChain LLC, the present payment
and servicing company for TIGRcub Securities. The Entrex Market
Index TIGRtoken security holders (TIGRtoken? holders) receive
99% of monthly GAAP Gross Revenues (received as TIGRcub Interest
Payments, or TIPs from TIGRcub Issuers) to Investors on the 30th
of each month (or the next business day pursuant to the payment
and services agreement). 1% of the monthly GAAP Gross Revenues
of the Entrex Market Index are provided to the Company as
compensation for operations. Various operational costs are
incurred by the Entrex Capital Market, LLC and/or the Entrex
eChain, LLC as the beneficiaries of the Entrex Market Index
purchases of TIGRcub Securities from Issuers. The Entrex Market
Index calculates various monthly Revenue Index of all the
companies within the Entrex Capital Market for distribution to
media channels. The Company anticipates, over time, that it
may create licensing income from the distribution of these
indexes.
Historical Operations: The Entrex Market Index has purchased a
limited series of various companies TIGRcub Securities since
February 2017. Through the monthly distributions, pursuant to
their TIGRcub agreements, the Entrex Market Index produced a
return of 12.19% with interest distributed monthly to
investors*. *The annualized average rate of return is based on
TIGRcubs issued since February 2017. An investor should not rely
on past performance as an indication of future performance.
TIGRcub values and returns will fluctuate. Investing in TIGRcubs
is subject to various risks that should be taken into
consideration, such as (but not limited to) market risk,
liquidity risk, and risk of default.
Current Operations: The Company currently manages a limited
series of TIGRcub investments and is poised to manage the
intended acquisition of up to 10% of existing and future issuers
across the Entrex Capital Market.
Growth Strategy: The Company anticipates growth through a series
of secondary offerings to increase the size of the Company?s
holdings of TIGRcub securities. Capital growth will provide
diversification of holdings beyond the proceeds of this
offering. The timing of commencement of operations may be
influenced by our relative success of this offering. We may not
raise sufficient proceeds through this offering in order to
fully execute our business plans.
The Offering
Securities Offered: 2,000,000 TIGRtoken Equity Securities
(TIGRtokens) at $10 per unit ? see PART II - ITEM 14.
Use of Proceeds: The net proceeds will be deployed to purchase
and hold up to 10% of the TIGRcub offering per Entrex Capital
Market Issuer.
Termination of Offering: The offering will commence as soon as
practicable after this Offering Circular has been qualified by
the Securities and Exchange Commission (the ?SEC?) and the
relevant state regulators, as necessary and will terminate on
the sooner of the sale of the maximum number of TIGRtoken Equity
securities being sold, twelve months from the effective date of
this Offering Statement or the decision by Company management to
deem the offering closed.
Offering Cost: We estimate our total offering estimated
offering, selling and operational expenses and compensation of
previous expenses of approximately $2,000,000 of the total
$20,000,000 offering amount.
PART II
ITEM 3b
RISK FACTORS
Investing in our securities involves risk. In evaluating the
Company and an investment in the securities, careful
consideration should be given to the following risk factors, in
addition to the other information included in this Offering
circular. Each of these risk factors could materially adversely
affect Entrex Market Index?s business, operating results or
financial condition, as well as adversely affect the value of an
investment in our securities. The following is a summary of the
most significant factors that make this offering speculative or
substantially risky. The company is still subject to all the
same risks that all companies in its industry, and all companies
in the economy, are exposed to. These include risks relating to
economic downturns, political and economic events and
technological developments (such as cyber-security).
Additionally, early-stage companies are inherently riskier than
more developed companies. You should consider general risks as
well as specific risks when deciding whether to invest.
Risks Related to the Company
The Company has limited capitalization and a lack of working
capital and as a result is dependent on raising funds to grow
and expand its business.
The Company lacks sufficient working capital in order to execute
its business plan. The ability of the Company to move forward
with its objective is therefore highly dependent upon the
success of the offering described herein. Should we fail to
obtain sufficient working capital through this offering we may
be forced to abandon our business plan.
Because we have a limited history of operations we may not be
able to successfully implement our business plan.
We have approximately one year of operational history producing
limited financial results to investors. Accordingly, our
operations are subject to the risks inherent in the
establishment of a new business enterprise, including access to
capital, successful implementation of our business plan and
limited revenue from operations. We cannot assure you that our
intended activities or plan of operation will be successful or
result in revenue or profit to us and any failure to implement
our business plan may have a material adverse effect on the
business of the Company.
We are dependent on the sale of our securities to fund our
operations.
We are dependent on the sale of our securities to fund our
operations and will remain so until we generate sufficient
revenues to pay for our operating costs. Our officers and
directors have made no written commitments with respect to
providing a source of liquidity in the form of cash advances,
loans and/or financial guarantees. There can be no guarantee
that we will be able to successfully sell our equity securities.
Such liquidity and solvency problems may force the Company to
cease operations if additional financing is not available. No
known alternative resources of funds are available in the event
we do not generate sufficient funds from operations.
Risks Relating to Our Business
We will be dependent upon key administrative personnel of the
Entrex Market Index for our future success, particularly Stephen
H. Watkins. If we lose this member of the EMI management team,
our ability to implement our business strategy could be
significantly harmed.
We will depend on the experience, diligence, skill and network
of business contacts of our management personnel. The management
personnel, together with other professionals the EMI may retain
subsequent to our offering, will evaluate, negotiate, structure,
close, monitor and service our purchase of TIGRcub securities
from specific companies, as based on the proprietary weighted
formula approved by the EMI investment committee. Our future
success will be depend to a significant extent on the continued
service and coordination of the EMI administrative personnel,
Stephen H. Watkins, who is also the Chairman of the Board of
Directors. The departure of this individual could have a
material adverse effect on our ability to achieve our objectives
and manage the portfolio.
There is no active trading market for our securities.
There is currently no active trading market for our securities.
If we cannot get enough companies to join the portfolio, there
is a risk that TIGRtoken returns will not meet expectations.
In order for our business model to be successful, the Entrex
Market Index relies on numerous companies joining our portfolio
by selling the Company their TIGRcub securities. If there are
not a sufficient number of companies, the portfolio could fail
to meet expectations.
If there are not enough investors, there will not be enough cash
to deploy to a portfolio of desired size, which could affect
anticipated investor returns.
The Entrex Market Index business model relies, in part, on the
diversification of TIGRcubs purchased from numerous issuers. If
there are not sufficient investors, the Entrex Market Index may
not be able to purchase 10% of each issuing company?s offer and
the portfolio may fail to meet investor diversification and
yield expectations.
Our ability to grow will depend on our ability to raise capital.
We need access to investor capital in order to purchase TIGRcub
revenue enhanced debt securities of private companies.
Our financial condition and results of operations will depend on
our ability to manage our future growth effectively.
The Entrex Market Index is a company with limited operating
history. As such, it is subject to the business risks and
uncertainties associated with any new business enterprise,
including the lack of experience in managing or operating a
business of this type. Our ability to achieve our objectives
will depend on our ability to grow, which will depend, in turn,
on our management personnel?s ability to identify, analyze and
purchase TIGRcubs from companies that meet the Entrex Market
Index purchase criteria.
Accomplishing this results on a cost-effective basis is largely
a function of our management personnel?s structuring of
administrative duties, their ability to provide competent,
attentive and efficient services to clients and our access to
financing on acceptable terms.
We will operate in a highly competitive market for investment
opportunities.
We compete for investors with traditional investment vehicles
(including private equity funds and mezzanine funds), other
equity and non-equity based investment funds, investment banks
and other sources of financing, including traditional financial
services companies such as commercial banks and specialty
finance companies. Many of our competitors, although in a more
traditional investment space, are substantially larger than us
and have considerably greater financial, technical and marketing
resources than we do.
Our quarterly and annual operating results are subject to
fluctuation as a result of the nature of our business, and if we
fail to achieve our objectives, the value of our securities may
decline.
We could experience fluctuations in our quarterly and annual
operating results due to a number of factors, some of which are
beyond our control, including the number of investors, the
number of companies that agree to issue TIGRcubs, the degree to
which we encounter competition in our markets and general
economic conditions. As a result of these factors, results for
any period should not be relied upon as being indicative of
performance in future periods.
There are significant potential conflicts of interest which
could impact our returns.
Our management team (and any that may be retained in the
future), and the future members of a Entrex Market Index may
serve as officers, directors or principals of entities that
operate in the same or a related line of business as we do or
organizations managed by affiliates of the Entrex Market Index
that may be formed in the future. Accordingly, if this occurs,
they may have obligations to investors in those entities, the
fulfillment of which might not be in the best interests of our
investors or us.
Operational and/or Ownership conflicts of interest.
Our management team (and any that may be retained in the
future), and the future members of the Entrex Market Index may
be owners or principals of entities that the Entrex Market Index
may purchase their TIGRcub Securities. Accordingly, if this
occurs, they may have obligations to investors in those entities
which may not be in the best interest of the TIGRtoken Equity
holders of the Entrex Market Index.
Our Management may choose to, exclusively at their option, to
sell or reclassify one or more class/es of securities which
could convey rights and privileges to their owners.
The Entrex Market Index management has the right to sell or
convert any of the Company?s securities into various securities
of any other company if deemed appropriate, exclusively at the
option of the management, into a private or publicly listed
Company.
Our Management may change our TIGRcub purchasing objectives,
operating policies and strategies without prior notice or
stockholder approval.
Our management has the authority to modify or waive certain of
our operating policies and strategies without prior notice and
without investor approval. However, absent investor approval, we
may not change the nature of our business so as to cease to
exist unless sold or purchased at the exclusive option of
management. We cannot predict the effect any changes to our
current operating policies or strategies would have on the
business model, operating results and returns to investors.
Nevertheless, the effects may adversely affect our business and
impact our ability to make distributions.
Changes in laws or regulations governing our operations may
adversely affect our business.
We are subject to regulation by laws at the local, state and
federal levels. These laws and regulations, as well as their
interpretation, may be changed from time to time. Any change in
these laws or regulations could have a material adverse effect
on our business.
Because the Entrex Market Index may be publicly traded, there
will be uncertainty regarding the value of our securities.
We shall provide to investors our calculation of the present
value (PV) of the Entrex Market Index TIGRcub portfolio. This
valuation may fluctuate significantly and could have no
relevance to actual results of the securities of the Entrex
Market Index.
Investing in private companies may present certain challenges to
us, including the lack of available information about these
companies.
We will be investing in private companies, which report to
Entrex eChain LLC through proprietary methodologies. Entrex
eChain LLC, as a service provider, has agreed to an acceptable
corporate review process that may or may not include mandating
audited financial statements from each portfolio company.
Purchase of previously issued Investor TIGRcub securities.
At the discretion of management; we may purchase TIGRcub
securities previously issued to investors via a Regulation D
offering made by the Entrex Market Index. These investors?
securities may be purchased by the Company at a premium or a
discount and at the sole discretion of management and may have
conflicts of interest with the company, the management or the
price of such securities.
Purchase of previously issued Issuer TIGRcubs securities.
At the discretion of management; we may purchase TIGRcub
securities purchased via funds provided by investors via
Regulation D offerings by the Entrex Market Index. These
issuer?s securities may be purchased by the Company at a premium
or a discount and at the sole discretion of management and may
have conflicts of interest with the company, the management or
the price of such securities.
Entrex Market Index limited operational income and expenses.
Entrex Market Index has had limited operational personnel with
historical costs absorbed by the Entrex Capital Market, LLC and
Entrex eChain LLC. If costs were to be paid directly in the
future the operations would incur costs which could limit
distributions to TIGRtoken Holders or significantly affect the
operations of the enterprise. Any funds remaining from the 1%
fees withheld from the GAAP Gross revenue investor distributions
(99%) will be distributed to licensors of technologies or
operational personnel at the sole discretion of management.
Entrex Market Index use of TICO score to establish algorithmic
risk has limited experience.
Entrex Market Index?s purchases TIGRcub securities issued
typically by private companies and as such financial information
is limited beyond information provided by the company and/or
their financial advisors. Based on the availability of
information we utilize a TICO score, or TIGRcub Indexed Credit
Observation, which is an algorithmic scoring tool used to
quantify a company?s ability to service TIGRcub debt securities.
We use the TICO to help manage purchase risk however based on
limited experience of the information inputs and algorithmic
outputs we have limited experience to know if the TICO
algorithmic parameters produce accurate investment risk profiles
of the underlying companies.
PART II
ITEM 4
DILUTION
We are offering TIGRtoken Equity Securities (TIGRtokens), which
will distribute 99% of GAAP Gross Revenue earned by the Entrex
Market Index to investors on a monthly basis.
Pursuant to the section labeled ?Warrants/Options? we may
provide TIGRtoken Equity securities (TIGRtokens) to members of
management, employees or partners which may or may not have a
dilutive effect to TIGRtoken Equity securities (TIGRtoken)
returns.
We anticipate future offerings which will purchase more TIGRcubs
which could add to the diversification of the underlying
purchased TIGRcub assets. These potential future offerings
will dilute the holdings of this offerings TIGRtoken Equity
(TIGRtokens).
PART II
ITEM 5
PLAN OF DISTRIBUTION
We are offering a maximum of 2,000,000 TIGRtoken Equity
Securities on a no minimum, ?best efforts? basis. The offering
will terminate upon the earlier to occur of: (i) the sale of all
TIGRtoken Securities being offered, or (ii) 365 days after this
Offering Circular is declared effective by the Securities and
Exchange Commission or (iii) or the decision by Company
management to deem the offering closed.
Our TIGRtoken securities are not currently listed on any
national exchange or qualified for trading on any electronic
quotation system. No securities are being sold for the account
of security holders; all net proceeds of this offering will go
to the Company.
Warrants/options:
As of the date of this prospectus, there are no outstanding
warrants to purchase our securities. We may however, pursuant to
the direction of management, issue warrants and/or options to
individuals and/or entities in the future. These warrants
and/or options may not be for the benefit of the TIGRtoken
Security holders.
State Securities Laws:
Under the securities laws of some states, the TIGRtoken
Securities may be sold in such states only through registered or
licensed brokers or dealers. In addition, in some states the
common shares may not be sold unless the shares have been
registered or qualified for sale in the state or an exemption
from registration or qualification is available and is complied
with.
PART II
ITEM 6
USE OF PROCEEDS TO ISSUER
We estimate that the net proceeds from the sale of the 2,000,000
TIGRtokens in this Offering will be approximately $18,000,000,
after deducting the estimated offering, selling and operational
expenses of approximately $2,000,000.
Each company participating in the Entrex Capital Market System
has up to 10% of its TIGRcub offering committed for purchase by
the Entrex Market Index. The Entrex Market Index purchases a
small portion of each TIGRcub Issuers? offering, providing
investors a diverse basket of yield-oriented, revenue-enhanced,
securities.
Accordingly, we expect to use the net proceeds, estimated as
discussed above as follows, if we raise the maximum offering
amount: Maximum Offering Amount: $20,000,000
Anticipated Purchase of TIGRcubs from Entrex Capital Market
Issuers:
Fully funding Offering: 100% $20,
000,000
Disclosed Expenses: 10% $
2,000,000
Net Offering distributed: 90%
$ 18,000,000
Anticipated Purchase of TIGRcubs: $
18,000,000
2017 Historical returns:
12.19%*
2017 Diluted return based as/if based on historical
performance: 10.97%**
*The annualized average rate of return is based on TIGRcubs
issued since January 2017. An investor should not rely on past
performance as an indication of future performance. TIGRcub
values and returns will fluctuate. Investing in TIGRcubs is
subject to various risks that should be taken into
consideration, such as (but not limited to) market risk,
liquidity risk, and risk of default. This document is not
intended as a solicitation or offer to sell TIGRcubs.
**Diluted return indicated are calculated ?as/if? the 12.19%
return provided to Entrex Market Index in 2017 had been diluted
pari-passu to the maximum net offering distributed in this
Offering. An investor should not rely on past performance as an
indication of future performance. TIGRcub values and returns
will fluctuate.
Investment Objectives:
Our primary investment objectives are:
-
to maximize the monthly yield distributed to of
investors
-
to preserve and protect your capital contribution;
-
to purchase TIGRcubs from high quality issuers to reduce
volatility and default risk
We will also seek to realize growth in the value of our
investments and to optimize the timing of their sale.
However, we cannot assure you that we will attain these
objectives or that the value of our investments will not
decrease. We have not established a specific policy regarding
the relative priority of these investment objectives.
Investment Criteria:
We believe the most important criteria for evaluating the
issuers whom we select for the Entrex Market Index include:
Historic and projected cash flowing companies
High growth industries
Strong management
2:1 or higher Debt Services
(EBITDA/Total Debt Services)
3:1 or lower Debt to Equity
(Total Debt/Book Equity)
3:75:1 or lover Leverage Multiple
(Total Long Term Debt/EBITDA)
Issuers? TIGRcub which are purchased by the Entrex Market Index
may or may/not have the indicated investment criteria above but,
at the exclusive discretion of management, may be waived as
deemed most effective for the anticipated benefit of TIGRtoken
holders.
?
PART II
ITEM 7
DESCRIPTION OF BUSINESS
Entrex Market Index or EMI is the composite index of the Entrex
Capital Market. The EMI purchases, as a holding company, up to
10% of each company that issues revenue enhanced debt
securities (called TIGRcubs) on the Entrex Capital Market
System.
The Entrex Capital Market, or ?Entrex? was founded in 2001 as
an Entrepreneurial Exchange with the mission to be the leading
?Capital Market System for Entrepreneurial companies?
Entrex focuses on $5-250 million annual revenue, cash-flowing
companies, via its Patented revenue enhanced debt security
trademarked a TIGRcub.
The TIGRcub simplifies investing in this sector of companies by
avoiding equity valuation issues and liquidity by simply
providing a debt structure which may have a base interest rate
and a small slice of revenue distributed to the TIGRcub holder
on a monthly basis.
This methodology provides monthly yield to investors ? with the
potential of enhanced-yield through revenue participation.
Through the establishment of monthly yield the TIGRcub can be
valued on a Net Present Value basis.
The Entrex Market Index, as a holding company, decides which
company?s TIGRcub Securities to purchase which issue securities
on the Entrex Capital Market.
The Entrex Market Index?s monthly GAAP Gross Revenues are
distributed by Issuing companies to the Entrex eChain LLC, the
present payment and servicing company for TIGRcub Securities.
The Entrex Market Index TIGRtoken Equity holders (TIGRtoken
holders) receive 99% of monthly GAAP Gross Revenues (received
as TIGRcub Interest Payments, or TIPs from TIGRcub Issuers) to
Investors on the 30th of each month (or the next business day
pursuant to the payment and services agreement).
1% of the monthly GAAP Gross Revenues of the Entrex Market
Index are provided to the Company as compensation for
operations. Various operational costs are incurred by the
Entrex Capital Market, LLC and/or the Entrex eChain, LLC as the
beneficiaries of the Entrex Market Index purchases of TIGRcub
Securities from Issuers.
The Entrex Market Index calculates various monthly Revenue
Index of all the companies within the Entrex Capital Market for
distribution to media channels. The Company anticipates,
over time, that it may create licensing income from the
distribution of these indexes.
The Entrex Market Index has purchased a limited series of
various companies TIGRcub Securities since February 2017.
Through the monthly distributions, pursuant to their TIGRcub
agreements, the Entrex Market Index produced a return of 12.19%
with interest distributed monthly to investors*.
*The annualized average rate of return is based on TIGRcubs
issued since February 2017. An investor should not rely on past
performance as an indication of future performance. TIGRcub
values and returns will fluctuate. Investing in TIGRcubs is
subject to various risks that should be taken into
consideration, such as (but not limited to) market risk,
liquidity risk, and risk of default.
The Company currently manages a limited series of TIGRcub
investments and is poised to manage the intended acquisition of
up to 10% of existing and future issuers across the Entrex
Capital Market.
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PART II
ITEM 8
DESCRIPTION OF PROPERTY
The Entrex Market Index utilizes offices of the Entrex Capital
Market. These offices are located on the 8th Floor at 150 East
Palmetto Park Road, Boca Raton, Florida.
The Entrex Market Index sub-licenses software from the Entrex
Capital Market LLC and the Entrex eChain LLC to manage invested
capital and investor returns. Payments made for operational
expenses, including license expense and personnel is exclusively
at the discretion of management.
Today three personnel operate at the aforementioned location,
one of which is part time. We anticipate with a successful
offering to supplement our team to manage the purchases of
TIGRcub Holdings and inquiries from investors.
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PART II
ITEM 9
MANAGEMENT DISCUSSION AND ANALSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Entrex Market Index has operated at our location during 2017
during which time it received capital from a Regulation D
private offering.
From funds received we purchased various TIGRcub certificates
from Issuers of the Entrex Capital Market and presently hold
these positions.
Operationally we receive an interest payment (TIGRcub Interest
Payment or TIP) from each of the Issuers via the Entrex eChain
LLC the current payment and service provider of TIGRcub
Securities. These TIPs are typically received on the 22nd of
each month or the next business day.
We distribute TIPS received, less a $2.50 service fee of the
Entrex eChain LLC, to each investor on the last day of the
month, or the next business day, typically via ACH to the
Certificate/s holder/s of record for the prior month.
Operating Results:
2017 resulted in $2,769.31 in TIP income to the Entrex Market
Index with $2,524.62 being distributed, net of fees, to
Investors. Interest received by investors in the Entrex Market
Index represented 12.19% APR for 2017.
Entrex Market Index investors are served through a payment and
service provider; today the Entrex eChain LLC. Growth in the
Company through this offering and potential further offerings
require and rely on both the Entrex Capital Market to obtain
Issuers to purchase TIGRcub Securities and to the Entrex eChain
LLC to manage Interest Payments to Investors of this offering ?
any material financial changes to those organizations may have a
material effect on the ability to deploy funds and the ability
to service investors interest payments. Further risks are
discussed in ?Risk Factors?.
Funds from this offering will be used to purchase an additional
$18,000,000 of TIGRcub Securities resulting in projected assets
held by the Entrex Market Index of: $18,030,000.
GAAP Income from the anticipated projected assets held by the
Entrex Market Index are expected to by $2,220,058 (Calculated as
if the investments had been made for a full calendar year).
TIGRtoken Interest distributions (99%) are paid, via the Entrex
eChain LLC, to investors which are anticipated to represent
$2,197,857 (Calculated as if the investments had been made for a
full calendar year) in resulting in projected APR interest to
investors of 10.97% (Calculated as if the investments had been
made for a full calendar year).
The Entrex Market Index received 1% of GAAP gross revenues ?
projected to be $22,201. These fees pay various costs of
banks, ACH wiring fees and other expenses. Any surplus fees are
distributed to the Technology Licensor: any deficiencies will be
paid by the Entrex Capital Market.
Material Changes:
No material changes are expected in the operations or investor
returns in 2018.
Various micro and macro-economic national or global events could
have significant effect on the holdings of the Company as these
events could or would have operational effect on the held
securities of underlying companies.
To date no TIGRcub Issuer has had a formal default of their
TIGRcub Securities: but it would be reasonable to expect that
companies? securities held by the Entrex Market Index would
experience financial difficulty and potential total loss.
If any one company?s holdings were completely lost (assuming
$1,000,000 held TIGRcub position per company) the net effects to
Investors in this offering would be reduced by approximately one
half of one percent (50 BPS). The net result of one
company?s complete loss, would therefore result in a 10.36% APR
for investors.
Any additional company holdings losses would continue material
negative effect to investors of this offering.
Liquidity:
The Entrex Market Index has limited liquidity as all invested
funds purchase holdings of companies pursuant to our business
plan.
If our present payment and servicing provider, Entrex eChain
LLC, chose not to perform services for us it would materially
affect the manner and timing for us to efficiently pay investors
the monthly coupon as stated. If new payment and servicing
entities chose to effect different and/or more expensive
alternative methods of investor payments the costs would result
in reduced payments being provided to investors on a monthly
basis.
Plan of Operations:
The Entrex Market Index has bought various TIGRcub Securities
issued on the Entrex Capital Market. As such this limited
experience relies on third party research and representations in
making purchase decisions pursuant to our business plan.
Historically these decisions have produced the 12.19% returns
for investors in 2017 but past performance cannot be relied upon
for future results.
Issuers of TIGRcub securities are typically private companies
and as such financial information is limited beyond information
provided by the company and/or their financial advisors. Based
on the availability of information we utilize a TICO score, or
TIGRcub Indexed Credit Observation, which is an algorithmic
scoring tool used to quantify a company?s ability to service
TIGRcub debt securities. We use the TICO to help manage
purchase risk: See Risk Factors.
Trends:
The Entrex Market Index was a beneficiary of the positive
macroeconomic position of the economy in 2017. The companies
we invest typically maintain a positive outlook on 2018 and the
future however investor returns from the Entrex Market Index
will be dictated by the overall economic performance of the
companies? securities held by the Entrex Market Index.
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PART II
ITEM 10
DIRECTORS, EXECUTIVE OFFICERS, AND CONTROL PERSONS
Our executive officers and directors as of the date of this
offering are as follows:
Name Position
Stephen H. Watkins Managing Member
Richard Rochon Member
Thomas Hatfield Member
Erin Flaherty Member
Alexander Adami Member
Stephen H. Watkins: is Managing Member and is the founding
Chairman and CEO of Entrex. Stephen is an experienced
entrepreneur founding a series of successful information and
business services companies; two of which grew to billion dollar
market cap companies. Stephen authored the book Capital Can?t
Fund What It Can?t Find. In the past he wrote a syndicated bi-
monthly finance column?read by over eight million national
readers at its peak.
Richard C. Rochon: is Vice Chairman of the Board of the Entrex
Holding Company (EHCo, LLC). Mr. Rochon has extensive
experience as an investor, shareholder, director and officer of
various public and private companies throughout his career and
has been involved in numerous acquisitions, divestitures, spin-
offs, initial public offerings, secondary offerings and other
corporate financings and transactions. Prior to joining Entrex
Mr. Rochon formed RPCP.
Thomas Hatfield: Manages the IBM Technology Platforms across
EMI and the associated Entrex Capital Market System companies.
Mr. Hatfield brings over 30 years of expertise creating and
solving complex online information systems. His technical
experience includes the US Army where he deployed tactical
information systems and with General Electric where was a
Systems Test Engineer for final testing and ground-station
operations for military space-satellite communications. His
expertise is over 20 years creating custom systems, for
organizations including Cadence Design Systems, NEC Electronics,
Flextronics and PeopleSoft.
Erin Flaherty: Manages the various holdings of the Entrex
Market Index and is instrumental in each trade and subsequent
monthly interest payments received to and from Issuers and
Investors.
Alexander Adami: Manages the financial analysis of the
underlying companies securities both before and during Issuers
securities are held by the Entrex Market Index
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PART II
ITEM 11
COMPENSATION OF DIRECTORS AND OFFICERS
Name Cash Compensation Other Compensation
Total Compensation*
Stephen H. Watkins* $1 $0
$1
*Compensation for operators and directors of the Company are
provided via wholly owned subsidiaries of EHCo, LLC the Entrex
Holding Company. Therefore limited compensation is made to
directors and officers of the Company.
Officers and Directors:
At our sole discretion we may add additional Officers and
Directors and compensate them through annual retainer fees along
with reimbursement of reasonable out-of-pocket expenses incurred
in connection with attending each meeting. Each independent
Officer and Director will receive $500 in connection with each
meeting that they attend, plus reimbursement of reasonable out-
of-pocket expenses incurred in connection with attending each
committee meeting not held concurrently with a board meeting. No
compensation is expected to be paid to Directors or Officers
until this offering is made effective.
Compensation for expenses, Officers and Directors will be
managed through the sole decisions and directions of the
Managing Member.
Indemnification Agreements:
We shall enter into indemnification agreements with our
Directors and Officers. The indemnification agreements are
intended to provide our Directors the maximum indemnification
permitted under law and/or requested by the respective Officer
and/or Director. Each indemnification agreement provides that
EMI shall indemnify the Director or Office who is a party to the
agreement (an ?Indemnitee?), including the advancement of legal
expenses, if, by reason of his or her corporate status, the
Indemnitee is, or is threatened to be made a party to or a
witness in any threatened, pending, or completed proceeding.
Significant Employees:
As of the date of this prospectus, Stephen H. Watkins is the
Managing Member of the Entrex Market Index and the key personnel
associated directly with the Entrex Market Index. Other staff
members and/or entities will be involved in Entrex Market Index
as required. At the sole discretion of management various
employment agreements and/or contracts may be made with key
personnel which regulate the manner of compensation and the
potential option purchases as provided in the employment
agreements.
Family Relationships:
There are no family relationships among our directors or
officers
Involvement in Certain Legal Proceedings:
None of our control persons are known to have been involved in
any of the following events during the past five years:
1.
Bankruptcy petition filed by or against any business of which
such person was a general partner or executive officer either
at the time of the bankruptcy or within two years prior to
that time;
2.
Any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and
other minor offences);
3.
Being subject to any order, judgment, or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining,
barring, suspending or otherwise limiting his involvement in
any type of business, securities or banking activities; or
4.
Being found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading
Commission to have violated a federal or state securities or
commodities law, and the judgment or decision has not been
reversed, suspended, or vacated.
Changes in Control:
We are unaware of any contract, or other arrangement or
provision of our Articles or by-laws, the operation of which may
at a subsequent date result in a change of control of our
company.
PART II
ITEM 12
SECURITY OWNERSHIP OF MANAGEMENT AND
CERTAIN SECURITYHOLDERS
Title of Class Name of Beneficial Amount
and Nature Percent of class (3)
Owner of
Beneficial Acquirable.
Preferred
Member
Interests Ubique Holdings, LLC* 100%
100%
This Offering TIGRtokens 100%
100%
*controlled by Watkins the Managing Member of the Entrex Market
Index, LLC
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PART II
ITEM 13
INTEREST OF MANAGEMENT AND
CERTAIN SECURITYHOLDERS
n/a
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PART II
ITEM 14
SECURITIES BEING OFFERED
We are offering a maximum of 2,000,000 TIGRtoken Securities
TIGRtoken Securities receive 99% of GAAP Gross Revenues received
by the company on a monthly basis; as confirmed monthly by
management.
These payments, made through the Entrex eChain LLC payment and
Servicing provider, are distributed to Investors via what the
IRS calls a "pass-through entity," like a partnership or sole
proprietorship. A limited liability company (LLC) is not a
separate tax entity like a corporation. The LLC itself does not
pay federal income taxes, although some states impose an annual
tax on LLCs.
TIGRtoken Securities have no dividend rights;
TIGRtoken Securities have no voting rights;
TIGRtoken Securities have no liquidation rights;
TIGRtoken Securities have no pre-emptive rights;
TIGRtoken Securities have no conversion rights;
TIGRtoken Securities have no redemption provisions;
TIGRtoken Securities have no rights inferred to the selection of
the Managing Member;
TIGRtoken Securities have no rights inferred to the decisions of
the Managing Member;
TIGRtoken Securities have no voting rights for any future Board
of Directors if created;
TIGRtoken Securities have no voting rights or selection of any
Officers;
TIGRtoken Securities have no decision on the leverage the
Company decides to obtain;
TIGRtoken Securities have no decision on and sale/merger or
acquisition;
TIGRtoken Securities have no liabilities for further calls or
future offerings;
TIGRtoken Securities have no liabilities associated with the
company;
TIGRtoken Securities have no decision on any distribution of
fees or acquisition price from a sale/merger of the company
beyond their continuation of the 99% of GAAP Gross Revenues,
from assets held, as decided by monthly by management.
PART F/S
ITEM 15
HISTORICAL AND PROJECTED FINANCIAL STATEMENTS
Entrex Market Index, LLC
Historical and Projected
Financial Statements
(unaudited*)
Balance Sheet(Projected)
12/31/2017 Post Post Capital Deployment
Assets
Cash 7 18,000,007 30,007
Holdings 30,000 30,000 18,000,000
Fees: 2,000,000 2,000,000,
Total Assets: 30,007 20,030,007 20,030,007
Liabilities: 30,000 0 0
Retained
Earnings: -446 -446 -446
TIGRtokens: 0 20,030,000 20,030,000
Common
Equity: 453 453 453
Total
Liabilities &
Equity: 30,007 20,030,007 20,030,007
Income Statement (projected)
2/31/2017 Post Capital
Deployment
Revenues: $2,769 $2,220,058
TIGRtoken Payments : $2,525 $2,197,857
Gross Income: $245 $22,201
Expenses** $691
Net Income: -446 $22,201
TIGRtoken Projected
Return: 12.19% 10.97%***
*See accompanying notes to these financial statements
** Entrex Market Index pushes operational expenses to the Entrex
eChain LLC which is the current Payment and Servicing Provider
for all TIGRcub Securities within the Entrex Capital Market
System. Expenses, historically, for the Entrex Market Index,
LLC have been limited to bank account costs and minimal other
expenses. Due to this operating structure limited expenses
are expected to be absorbed by the Entrex Market Index Directly
with 99% of revenues distributed to TIGRtoken Holders. Any
profit, post expenses, are provided to license fees or dictated,
at its sole discretion, by the Managing Member.
*** The reduction in the post capital deployment projected
return compared to the 2017 actual return is due to the fees
associated with raising $20,000,000 via a Tier 1 Offering
pursuant to Regulation A.
Note 1. Organization, History and Business
ENTREX MARKET INDEX, LLC (?the Company?) became a Limited
Liability Corporation in Florida on January 24, 2018. The
Company was established for the purpose of adding a vehicle for
additional equity to fund Issuers, on an Indexed base, across
the Entrex Capital Market. The Company's fiscal year end is
December 31.
Note 2. Revenue Recognition
Revenue is derived from contracts with businesses through
TIGRcub Securities. Revenue is recognized in accordance GAAP
considered TIGRcub Interest Payments or TIPs.
Note 3. Stock Based Compensation
When applicable, the Company will account for stock-based
payments to employees in accordance with ASC 718, ?Stock
Compensation? (?ASC 718?). Stock-based payments to employees
include grants of stock, grants of stock options and issuance of
warrants that are recognized in the consolidated statement of
operations based on their fair values at the date of grant.
The Company accounts for stock-based payments to non-employees
in accordance with ASC 505-50, ?Equity-Based Payments to Non-
Employees.? Stock-based payments to non-employees include
grants of stock, grants of stock options and issuances of
warrants that are recognized in the consolidated statement of
operations based on the value of the vested portion of the award
over the requisite service period as measured at its then-
current fair value as of each financial reporting date.
The Company calculates the fair value of option grants and
warrant issuances utilizing the Binomial pricing model. The
amount of stock-based compensation recognized during a period is
based on the value of the portion of the awards that are
ultimately expected to vest. ASC 718 requires forfeitures to be
estimated at the time stock options are granted and warrants are
issued to employees and non-employees, and revised, if
necessary, in subsequent periods if actual forfeitures differ
from those estimates. The term ?forfeitures? is distinct from
?cancellations? or ?expirations? and represents only the
unvested portion of the surrendered stock option or
warrant. The Company estimates forfeiture rates for all
unvested awards when calculating the expense for the period. In
estimating the forfeiture rate, the Company monitors both stock
option and
Note 4. Summary of Significant Accounting Policies
(continued)
Warrant exercises as well as employee termination patterns. The
resulting stock-based compensation expense for both employee and
non-employee awards is generally recognized on a straight-line
basis over the period in which the Company expects to receive
the benefit, which is generally the vesting period.
Note 5. Related Party Transactions
There have been no related party transactions other than the
following related party stock issuances.
Note 6. Income Taxes
The Company adopted the provisions of ASC 740-10-50, formerly
FIN 48, and ?Accounting for Uncertainty in Income Taxes?. The
Company had no material unrecognized income tax assets or
liabilities as of October 1, 2016.
The Company?s policy regarding income tax interest and penalties
is to expense those items as general and administrative expense
but to identify them for tax purposes. During the period
September 7, 2016 (inception) through October 1, 2016 there were
no income tax, or related interest and penalty items in the
income statement, or liabilities on the balance sheet. The
Company files income tax returns in the U.S. federal
jurisdiction and the state of Delaware. We are not currently
involved in any income tax examinations.
Note 7. Going Concern
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.
Currently, the Company has no operating history and has not
generated significant revenue. These factors raise substantial
doubt about the Company?s ability to continue as a going
concern. Management believes that the Company?s capital
requirements will depend on many factors including the success
of the Company?s development efforts and its efforts to raise
capital. Management also believes the Company needs to raise
additional capital for working capital purposes. There is no
assurance that such financing will be available in the
future. The conditions described above raise substantial doubt
about our ability to continue as a going concern. The financial
statements of the Company do not include any adjustments
relating to the recoverability and classification of recorded
assets, or the amounts and classifications of liabilities that
might be necessary should the Company be unable to continue as a
going concern.?
ITEM 16
INDEX TO EXHIBITS
Exhibit A. State Filing Documents
Exhibit B. Federal EIN
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PART III
ITEM 17
DESCRIPTION OF EXHIBITS
Exhibit A. State Filing Documents
Exhibit B. Federal EIN
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PART III
SIGNATURE PAGE
ITEM 18
Pursuant to the requirements of Regulation A, the issuer
certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form 1-A and has
duly caused this Offering statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of
Boca Raton and County of Palm Beach, in the State of Florida,
March 6, 2018.
Entrex Market Index, LLC.
By: /s/ Stephen H. Watkins
Name: Stephen H. Watkins
Title: Managing Member
(and Principal Executive Officer)
In accordance with the requirements of the Securities Act of
1933, this registration statement was signed by the following
persons in the capacities and on the dates stated.
Signature Title
Date
/s/ Stephen H. Watkins Managing Member
March 12,2018
Stephen H. Watkins (and Principal Executive Officer)