Investors – Laws & impact on funding
Daryl Oster & Russ Derickson – Investors – Know how the laws impact your options to solicit investors or partners for your project.
Daryl Oster: Elon Musk invited us to Space X couple months ago; we had a really good meeting. We talked about Hyperloop and we told him about ET3 and at the conclusion of the meeting he mentioned that his plates are very full with running two companies and that he’s not going to be able to take an active role in the development of this idea and that’s one of the reasons why open sourced it, so he put it out there for other companies to be able to take advantage of those ideas or to put a focus on other ideas and he said that he would not be a lead investor but he wanted to invest in our first project. The thing that…the timing about a little bit with investment standpoint and making a, what you call a pitch here, it’s actually illegal to do that. I cannot legally in the United States make a solicitation for investment for my company or unless it is a register security with the security exchange commission and it goes through a broker dealer and all of those very expensive processes that entail right now in today’s market maybe a couple hundred thousand dollars’ worth of expenses . So it’s not something that we can do, a lot of companies do because they are not aware of what the law says but since I was a series seven broker for a few years and also a series twenty four with my transport license there is no pleading ignorance the laws are very clear. Those laws have been modified recently but the new rules are not in place yet.
Marzena Kmiecik: So let’s talk about finding a partner, the right partner who would love to be part of the company.
Daryl Oster: What we can talk about is that with the license agreement, people can buy a licence to use the technology and control their own investment and their own project and their own resources and pay a six per cent royalty to ET3. So that is one way to form a company to do that and we actively work with several different projects with different licensees.