Systems, Processes and Methods of Financing Entertainment Projects and Products Thereby

• US 20110055056A1
• Filed: 08/27/2009
• Published: 03/03/2011
• Est. Priority Date: 08/27/2009
• Status: Abandoned Application

• Current Assignee: Prospect Park LLC
• Original Assignee: Prospect Park LLC
• Inventors: Kwatinetz, Jeff
• Application Number:
  US12/549,299
• Publication Number:
  US 20110055056A1
• Time in Patent Office: Days
• US Class Current: 705/30
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: G06Q 40/12 Accounting

Abstract

Systems, processes and methods of financing an entertainment project such as a feature film comprising the public offering for sale of a limited-life vehicle such as shares of common stock in a corporation whose primary asset is the project such that buyers (investors) become beneficial owners of the entertainment project, using the proceeds associated with the sale of the vehicle to produce the project, providing for the registration of the security instrument evidencing the vehicle, and paying to investors periodic returns such as distributions based upon the revenues of the entertainment project.

Claims

1. A method of financing an entertainment project comprising:

publicly offering for sale equity interests in a legal entity with a limited period of existence;

wherein the entity holds rights to an entertainment project such that buyers of the equity become beneficial owners of the entertainment project;

wherein a registration statement for the sale of the securities is filed with the United States Securities and Exchange Commission before offering the securities for sale;

disclosing all material terms of the project in the prospectus;

wherein a registration statement for the sale of the securities is declared effective by the United States Securities and Exchange Commission before selling the securities;

using the proceeds generated from the sale of the equity to produce, distribute and market the entertainment project;

using the revenues generated from the entertainment project to pay periodic distributions pari passu to all common equity holders;

calculating financial statements in accordance with generally accepted accounting principles;

wherein the financial statements are audited by a certified public accountant at an independent registered public accounting firm;

equity holders may sell their securities in the public markets; and

dissolving and winding-up the entity after a pre-determined period of time.

2. The method of claim 1, wherein the proceeds from the sale of equity is sufficient to finance the full anticipated budget for producing, distributing and marketing the entertainment project.

3. The method of claim 1, wherein the entity is a corporation and the equity is shares of common stock.

4. The method of claim 3, wherein the producers of the project are officers or directors of the corporation.

5. The method of claim 1, wherein the entity is a limited liability company and the equity is membership interests.

6. The method of claim 5, wherein the producers of the project are managers of the limited liability company.

7. The method of claim 1, wherein the entertainment project is a feature length motion picture or television program.

8. The method of claim 7, further comprising a screenwriter, director or principal actor being attached to the film before completion of the offering.

9. The method of claim 8, further comprising above-the-line talent accepting shares of common stock as compensation.

10. The method of claim 9, where no above-the-line talent receives any profit participation in the picture other than shares of common stock.

11. The method of claim 10, where no participant receives any compensation other than shares of common stock or cash.

12. The method of claim 11, further comprising restrictions on the ability of above-the-line talent to sell their shares of stock during designated periods or for a period of time after completion of the offering.

13. The method of claim 12, where the restrictions include any time before release of the film or premiere of the television program.

14. The method of claim 7, wherein the entertainment project is a slate of multiple feature films or television series.

15. The method of claim 14, further comprising a slate that is related by having the same director, producer, lead actor, screenwriter or genre for each of the films comprising the slate.

16. The method of claim 1, wherein the entertainment project is an album length musical recording.

17. The method of claim 16, further comprising a recording artist being attached to the project before completion of the offering.

18. The method of claim 17, further comprising a recording artist, musician, songwriter or producer accepting shares of common stock as compensation.

19. The method of claim 18, where no recording artist, musician, songwriter, or producer receives any profit participation in the project other than shares of common stock.

20. The method of claim 19, where no participant receives any compensation other than shares of common stock or cash.

21. The method of claim 20, further comprising restrictions on the ability of talent to sell their shares of stock during designated periods or for a period of time after completion of the offering.

22. The method of claim 21, where the restrictions include any time before release of the recording.

23. The method of claim 3, wherein no issuance of shares of preferred stock is authorized without stockholder approval.

24. The method of claim 1, wherein no issuance of convertible securities is authorized without stockholder approval.

25. The method of claim 3, wherein no issuance of shares of common stock beyond the stated amount of the full public offering is authorized without stockholder approval.

26. The method of claim 4, wherein no issuance of membership interests beyond the stated amount of the full public offering is authorized without stockholder approval.

27. The method of claim 1, wherein periodic distributions are made at least annually when the entertainment project generates revenues.

28. The method of claim 1, wherein periodic distributions are made quarterly for approximately two years after the entertainment project begins to generate revenue.

29. The method of claim 1, wherein the rights to the project are sold and a final distribution is made to equity holders after a majority of projected proceeds from the project are received.

30. The method of claim 29, wherein the final dividend corresponds to a pre-determined percentage of the net present value based on projected remaining future income of the entertainment project.

31. The method of claim 1, further comprising selling the entertainment project and distributing the sale proceeds among the equity holders.

41. Products, by the process of claim 1.

32. A system of financing an entertainment project comprising:

an initial public offering of equity interests in an entity holding rights to an entertainment project such that buyers of the equity become beneficial owners of the entertainment project;

pursuant to an effective registration statement for the sale of securities;

with the equity interests to be quoted or listed for sale on a national quotation service or national securities exchange after completion of the offering;

using the proceeds generated from the sale of the equity to produce, distribute and market the entertainment project;

periodically publicly reporting the financial results of the entertainment project in accordance with generally accepted accounting principles, as audited by certified public accountants at an independent registered public accounting firm; and

equity holders may sell their purchased securities in the public markets.

33. The system of claim 32, wherein the proceeds from the sale of equity is sufficient to finance the full anticipated budget for producing, distributing and marketing the entertainment project.

34. The system of claim 32, wherein the entity is a corporation and the equity is shares of common stock.

35. The system of claim 32, wherein the entertainment project is a feature length motion picture.

36. The system of claim 35, wherein the entertainment project is a slate of multiple feature length motion pictures.

37. The system of claim 32, wherein the entertainment project is an album length musical recording.

38. The system of claim 37, wherein the entertainment project is a series of album length musical recordings by a single recording artist.

39. The system of claim 32, wherein the initial public offering is completed before production of the entertainment project.

40. The system of claim 32, wherein the initial public offering is completed before release of the entertainment project.

42. Products, by the system of claim 32.