Method for creating and marketing a modifiable debt product
First Claim
1. A computer implemented method of creating and marketing a modifiable debt product having a coupon wherein a debtor has the ability to change the type of the coupon comprising the steps of:
- issuing one or more modifiable debt instruments of the debtor that provide a moditiable coupon that the debtor can modify after the issuing of the debt instruments;
forming a special purpose entity which holds the modifiable debt instruments;
creating beneficial interests in the special purpose entity that pay a fixed coupon type;
obtaining for the special purpose entity a swap of the modifiable coupon for the fixed coupon type; and
marketing the beneficial interests to investors.
1 Assignment
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Accused Products
Abstract
This invention relates to a method for creating and marketing a modifiable debt product wherein a debtor who issues the debt note has the ability to modify the type of the note coupon multiple times throughout the life of the note while continuously providing fixed coupons to respective investors. The modifications to the note coupon are determined by prevailing market conditions and are executed as on-market transformations. The invention provides flexibility to the debtor who may wish to change the note in response to the fluctuations of the market without creating additional risk to investors.
102 Citations
34 Claims
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1. A computer implemented method of creating and marketing a modifiable debt product having a coupon wherein a debtor has the ability to change the type of the coupon comprising the steps of:
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issuing one or more modifiable debt instruments of the debtor that provide a moditiable coupon that the debtor can modify after the issuing of the debt instruments; forming a special purpose entity which holds the modifiable debt instruments; creating beneficial interests in the special purpose entity that pay a fixed coupon type; obtaining for the special purpose entity a swap of the modifiable coupon for the fixed coupon type; and marketing the beneficial interests to investors. - View Dependent Claims (2, 3, 4, 5, 6, 7, 8, 9, 10)
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11. A method of financing a loan for a debtor wherein the debtor has the ability to change the type of the coupon in a note for a debt, the method comprising the steps of:
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receiving a note of the debtor providing a modifiable coupon whose type the debtor has the ability to change; swapping the modifiable coupon for a fixed coupon type; and
,issuing to an investor a note having a coupon of the fixed coupon type. - View Dependent Claims (12, 13, 14, 15, 16, 17, 18, 19, 20)
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- 21. An income product for providing investors with payments of a fixed coupon type comprising a beneficial interest in a trust, wherein the trust holds as assets one or more modifiable coupon notes, wherein a debtor has the ability to change the type of coupon, and wherein the trust also holds a swap agreement providing for swapping the modifiable coupons to the fixed coupon type.
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31. A modifiable debt product comprising a note between a debtor and a lender wherein the debtor has the ability to change the note coupon type during the life of the note with on-market transformations, the note limiting the debtor'"'"'s ability to change the types of the coupon to selection from a predetermined group of coupon types;
- and the note providing the change in coupon types to be an on-market transformation determined in accordance with prevailing market conditions.
- View Dependent Claims (32, 33, 34)
Specification