Governance
Member money and partnership money never touch
The safeguards below exist because the partnership holds money that belongs to its members. They are described here so an investor can see exactly what constrains the general partner, and where the boundary between the two pools of money is drawn.
Safeguards
How the partnership is structured
- Entity
- Delaware LP
- NWX Consorcio LP, governed by Delaware partnership law. General Partner: NWX Management LLC.
- Custody
- Segregated accounts
- Member contributions held in segregated accounts at FDIC-insured U.S. banks.
- Insurance
- D&O coverage
- Directors & Officers insurance, funded by a 2% allocation of AUM.
- Reserve fund
- 5% of AUM
- Dedicated reserve against member default within a group.
- Credit reporting
- Three bureaus
- Opt-in member reporting to Equifax, Experian and TransUnion.
- Securities compliance
- Reg D, Rule 506(c)
- Form D filed. All purchasers verified as accredited investors.
- Physical presence
- Three offices
- Atlanta (HQ), Orlando and Miami, with advisors on site.
- Academic grounding
- Published research
- Savings-and-credit contract research from Princeton, MIT, the Federal Reserve, the BIS and NBER.
Segregation
Member money and partnership money are not the same money
The separation runs in both directions, and it is the first thing a diligence reader should check.
Member contributions
Held in segregated accounts at FDIC-insured U.S. banks. This money funds credit letters for the group. It is not partnership working capital, and it is not available to pay investor distributions.
Partnership revenue
The 19% administrative load is what the partnership earns. Investor distributions are paid from a share of that load, which is why growth in enrolment is the variable that drives them.
Two separate things
The member program and this offering
NWX operates a member program and is separately raising capital. They are governed differently and should not be read as one product.
The member program
Not an investment
- Pays no interest, return, or yield to members.
- Gives access to an asset, not a financial gain.
- Open to the public, subject to state availability.
- Governed by its own terms at nwxconsorcio.com.
This offering
A security
- Pays 8% annual interest on the capital base.
- Carries an option to convert into equity in the general partner.
- Open only to verified accredited investors.
- Offered under Regulation D, Rule 506(c), with Form D filed.
Regulatory posture
What the filings do and do not mean
Filing a Form D with the Securities and Exchange Commission does not constitute approval, review, or endorsement of this offering, the issuer, or the terms described here by the SEC or any state regulator.
The partnership files a Form D for this offering and verifies the accredited status of every purchaser, as Rule 506(c) requires. The member program operates under its own separate disclosure obligations and is not part of this offering.