Our two primary sources of revenue are one-time placement fees at the time of a property's initial public offering and a recurring annual fee.
LEX collects a one-time placement fee from an affiliate of the issuer of each LEX Security at the time of the initial public offering. The amount of that fee varies from offering to offering and is set forth in the offering circular or prospectus of each LEX Security, available on EDGAR. That cost is borne by the sponsor of each offering and is not borne by public unit holders.
LEX collects an annual fee from issuers of LEX Securities equal to 1% of the public float. That fee is collected out of income distributions paid by the issuer to its public unit holders, reducing the amount received by public unit holders.
For example, on a theoretical property with $10m of public float on LEX (in other words, $10m was raised in the IPO), LEX would receive an annual fee of $100,000. If that theoretical property produced an annual distribution yield of 8%, this fee would reduce the distribution paid to public unit holders to 7%.
LEX does not charge any trading commissions, and absorbs any clearing, SEC, and FINRA trading fees.
LEX also receives credit interest from our clearing firm, Apex Clearing, based on the total cash balances of client accounts held at Apex Clearing.