Trade financing method, instruments and systems

• US 7,155,409 B1
• Filed: 03/05/1999
• Issued: 12/26/2006
• Est. Priority Date: 03/05/1999
• Status: Expired due to Term

• Current Assignee: Trade Finance Service Corporation
• Original Assignee: Trade Finance Service Corporation
• Inventors: Stroh, Leslie
• Primary Examiner(s): Colbert, Ella
• Application Number:
  US09/264,171
• Time in Patent Office: 2,853 Days
• Field of Search: 705/57, 705 35- 38, 709/223
• US Class Current: 705/37
• CPC Class Codes: G06Q 10/087 Inventory or stock management, e.g. order filling, procurement or balancing against orders
• CPC Class Codes: G06Q 30/04 Billing or invoicing
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

A simplified trade finance method useful, inter alia, in international trade in goods or services, a “traded product”, can employ one, and preferably two, novel, modified bills of exchange. A first bill of exchange, which is a payment draft, is executed by a buyer B, and returned to seller S prior to release of the traded product by seller S. Seller S can obtain credit verification of the first bill of exchange, if necessary, before releasing the traded product, protecting seller S from failure of buyer B to pay. The first bill of exchange can be dormant and non-negotiable until activated by an event agreeable to buyer B, for example, release of the traded product. Buyer B is thus protected against seller S delaying or failing to ship the traded product after having received a payment instrument from buyer B.

Claims

1. A trade finance method for financing the sale of a traded product supplied by a seller to a buyer physically removed from the seller, the method comprising:

a) the buyer providing an event-activated, prerelease latent payment draft to the seller or the seller'"'"'s agent prior to release of the traded product from the seller'"'"'s control wherein the event-activated prerelease latent payment draft;

i) is drawn by the seller;

ii) is payable to the seller'"'"'s order by a financial institution and is non-negotiable when drawn;

iii) is drawn on the buyer at the financial institution and is executed by the buyer to indicate the buyer'"'"'s acceptance of the payment draft;

iv) sets forth a payment draft activating event, the activating event being effective to render the draft negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain and occurrence of the activating event being agreed by the buyer and seller as commencing the payment term;

v) sets forth a payment term of specified duration, the payment term commencing with the date of occurrence of the activating event, the date of the activating event being a date occurring after execution of the payment draft by the buyer; and

vi) orders a payment of a specified amount of money to be made within the payment term;

b) the buyer executing a second payment draft, the second payment draft also satisfying the conditions of the first payment draft set forth in clauses a) i)–

vi) hereinbefore, prior to receiving the traded product; and

c) the seller releasing the traded product for delivery to the buyer subsequently to receiving the latent payment draft;

wherein the first and second payment drafts are mutually extinguishable, each payment draft being designated as being payable if the other payment draft remains unpaid.

2. A method according to claim 1 wherein the prerelease latent payment draft is also executed by the seller prior to the activating event.

3. A method according to claim 2 wherein the activating event comprises release of the traded product from the seller'"'"'s control, and wherein the seller releases the traded product subsequently to receipt by the seller of the prerelease latent payment draft.

4. A method according to claim 2 wherein the prerelease latent payment draft comprises a transaction window containing transaction identifiers that permit identification of the transaction comprising the sale of the traded product.

5. A method according to claim 4 wherein the transaction window occupies a distinct area on the prerelease latent payment draft separate from the payment draft characteristics and the transaction identifiers comprise one or more of a seller identification number, a proforma invoice identification number, a credit insurance company'"'"'s control number, an invoice number, a shipment number, a customs internal tracking number and a buyer identification number.

6. A method according to claim 4 wherein the transaction identifiers comprise a seller identification number, a proforma invoice identification number, a credit insurance company'"'"'s control number, an invoice number, a shipment number, a customs internal tracking number and a buyer identification number.

7. A method according to claim 2 wherein the method is computer-assisted, the prerelease latent payment draft being generated by software running on a computer, wherein the prerelease latent payment draft comprises an electronic file or a paper document printed from an electronic file, wherein the buyer can accept the prerelease latent payment draft prior to formal issuance of the draft by the seller, the instrument being incomplete until both the seller-issuer and the buyer-acceptor have signed or otherwise electronically applied their assent.

8. A method according to claim 2 wherein the seller is an exporter in one country, the buyer is an importer in another country, state or region, the traded product comprises shippable goods and the activating event comprises release of the goods by the exporter for shipment to the importer.

9. A method according to claim 8 wherein the prerelease latent payment draft comprises an electronic file, or a paper document printed from an electronic file, and is also executed by the seller prior to the activating event wherein the activating event comprises release of the traded product from the seller'"'"'s control subsequently to receipt by the seller of the prerelease latent payment draft and wherein the prerelease latent payment draft comprises a transaction window visually separate from the payment draft data, the transaction window containing transaction identifiers that permit identification of the transaction comprising the sale of the traded product.

10. A trade finance method according to claim 1 further comprising

c) the financial institution making the payment of the specified amount of money to the seller.

11. A trade finance method according to claim 10 further comprising:

d) the seller presenting the payment draft to the financial institution for collateral or collection.

12. A trade finance method according to claim 11 further comprising:

e) the financial institution collecting payment for the payment draft from the buyer.

13. A trade finance method according to claim 1 wherein the payment draft is transaction-independent and wherein the activating event comprises release of the traded product from the seller'"'"'s control, the method further comprising:

c) the financial institution making payment to the seller;

d) the seller presenting the payment draft to the financial institution for collateral or collection; and

e) the financial institution collecting payment for the payment draft from the buyer.

14. A trade finance method according to claim 1 wherein the payment draft has a term calculated from the specified event date of at least 30 days, or of 60, or 90 or 180 days.

15. A trade finance method according to claim 1 wherein the payment draft is specified on its face as being the first of a set of two mutually extinguishable payment drafts.

16. A trade finance method according to claim 1 wherein the traded product consists essentially of goods, of services or of goods and services.

17. A trade finance method for financing the sale of a traded product supplied by a seller to a buyer physically removed from the seller, the method comprising:

a) the buyer providing an event-activated prerelease first bill-of exchange to the seller or the seller'"'"'s agent prior to release of the traded product from the seller'"'"'s control wherein the event-activated first bill-of exchange;

i) is drawn by the seller;

ii) is payable to the seller'"'"'s order by a financial institution and is non-negotiable when drawn;

iii) is drawn on the buyer at the financial institution and is executed by the buyer to indicate the buyer'"'"'s acceptance of the payment draft;

iv) sets forth a payment draft activating event, the activating event being effective to render the draft negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain, occurrence of the activating event being agreed by the buyer and seller as commencing the payment term;

v) sets forth a payment term of specified duration, the payment term commencing with the date of occurrence of the activating event, the date of the activating event being a date occurring after execution of the payment draft by the buyer; and

vi) orders a payment of a specified amount of money to be made within the payment term; and

b) the seller releasing the traded product for delivery to the buyer; and

c) the buyer executing a second bill-of-exchange, the second bill-of-exchange also satisfying the conditions of the first bill-of-exchange set forth in clauses a) i)–

vi) hereinbefore, prior to receiving the traded product;

wherein the first and second bills-of-exchange are mutually extinguishable, each bill being designated as being payable if the other bill-of-exchange remains unpaid.

18. A method according to claim 17 comprising substituting a banker'"'"'s acceptance for the first bill-of-exchange.

19. A method according to claim 17 comprising furnishing a pro-forma invoice to the buyer before execution of the first bill-of-exchange by the buyer wherein the pro-forma invoice comprises information indicia indicative of

a) the identities of the buyer and the seller;

b) the nature of the traded product; and

c) a purchase price to be paid by the buyer to the seller as consideration for the traded product, the purchase price having been previously agreed by the buyer and the seller.

20. A method according to claim 19 wherein the proforma invoice includes a contractual condition removing merchandise claims or disputes from the payment cycle for resolution in accordance with international convention or treaty.

21. A method according to claim 19 wherein the pro-forma invoice further comprises information indicative of:

d) agreement by the buyer to use the first bill-of-exchange to pay for the purchased product.

22. A method according to claim 21 wherein the trade is an international transaction and wherein the pro-forma invoice further comprises information indicative of:

e) the law applicable to the offer and acceptance cycle and to the underlying trade transaction.

23. A method according to claim 21 wherein the trade is a domestic transaction, the buyer and the seller being located in the same country, state or region, and wherein the pro-forma invoice further comprises information indicia indicative of:

e) the law applicable to the offer and acceptance cycle and to the underlying trade transaction as being a law of the respective country, state or region.

24. A method according to claim 19 wherein the first bill-of-exchange is made out in the amount of the pro-forma invoice and wherein the pro-forma invoice is linked to the first bill-of-exchange, for use in initiating a draft substitution process.

25. A method according to claim 19 wherein the first bill-of-exchange is completed and executed by the buyer, for re-presentation to the buyer for payment at a later date.

26. A trade finance method according to claim 19 implemented on a computerized information processing system wherein, not before release of the traded product to the buyer, the seller issues an invoice for the traded product, wherein the proforma invoice references the first bill-of-exchange and the invoice references the second bill-of-exchange and the proforma invoice, the first bill-of-exchange, the second bill-of-exchange and the invoice being for the amount of the proforma invoice, and wherein the proforma invoice is a system precursor of the invoice, the method including system validation of the invoice from the proforma invoice.

27. A trade finance method according to claim 19 implemented on a computerized information processing system wherein, not before release of the traded product, the seller issues an invoice for the traded product, wherein the invoice references the proforma invoice and the first bill-of-exchange, the first bill-of-exchange, the second bill-of-exchange and the invoice being for the amount of the proforma invoice, the method including automated system comparison of the proforma invoice with the invoice for document verification in the trade finance process and wherein if said system comparison finds the invoice to be at variance with the proforma invoice, the buyer and the seller can by common agreement reinitiate the proforma invoice and first bill-of-exchange so as to make congruent the proforma invoice, the invoice, the first bill-of-exchange, and the second bill-of-exchange.

28. A method according to claim 17 comprising the seller and the buyer contracting to remove merchandise claims or disputes from the payment cycle for resolution in accordance with international convention or treaty.

29. A method according to claim 17 wherein the trade is an international transaction, wherein the method comprises furnishing a pro-forma invoice to the buyer before execution of the first bill-of-exchange by the buyer, wherein the pro-forma invoice comprises information regarding the identities of the buyer and the seller, identification of the traded product and the value of the traded product, wherein the event comprises release of the traded product from the seller'"'"'s control and wherein at least the first bill-of-exchange comprises an electronic file.

30. A method according to claim 29 wherein at least one of the first bill-of-exchange, the second bill-of-exchange, the pro-forma invoice and the invoice is or are electronically generated by computer-implemented software and are electronically transmitted to an intended recipient.

31. A method according to claim 17 comprising a purchase agreement signed by the buyer wherein the purchase agreement provides for:

f) agreement by the buyer to use the first bill-of-exchange to pay for the purchased product; and

g) the law applicable to the offer and acceptance cycle and to the underlying trade transaction.

32. A method according to claim 17, being an international trade transaction, the method further comprising a financial institution capable of issuing a banker'"'"'s acceptance, or a service intermediary acting on behalf of the financial institution, pre-approving, for the seller, substitution of a banker'"'"'s acceptance for the first bill-of-exchange accepted by the buyer.

33. A method according to claim 32 comprising the seller notifying the financial institution or its service intermediary, that the buyer and seller are about to enter into a transaction, and that at the conclusion of the transaction, the seller will offer to exchange a trade acceptance for a banker'"'"'s acceptance pre-approved by the financial institution.

34. A method according to claim 33 wherein the transaction advances if the acceptance-issuing institution approves the buyer and the transaction is aborted if the transaction or the buyer is not pre-approved.

35. A method according to claim 34 wherein, after receiving the approval of the acceptance-issuing institution, the seller releases the traded product to the buyer and wherein such release comprises the activating event initiating the term of the first bill-of-exchange.

36. A method according to claim 35 wherein, not before release of the traded product to the buyer, the seller sends an invoice for the product along with a second bill-of-exchange to the buyer'"'"'s bank.

37. A method according to claim 36 wherein the second bill-of-exchange includes unique transaction identifiers and contains instructions to the buyer to pay on a date certain a sum of money to the account of the acceptance-issuing institution, under terms and conditions similar to the terms and conditions set forth in the first bill-of exchange.

38. A method according to claim 37 further comprising:

i) the buyer'"'"'s bank holding the buyer-signed second bill-of-exchange to maturity;

j) at maturity, the buyer'"'"'s bank debiting the buyer'"'"'s account and making a remittance to the appropriate party;

k) the seller furnishing to the acceptance-issuing institution the buyer-accepted first bill-of-exchange along with evidence of release of the traded product according to the accepted pro-forma invoice;

l) accepting institution issuing or causing to be issued a banker'"'"'s acceptance having a maturity related to the maturity of the first and second bills-of-exchange; and

m) upon the date certain, the buyer'"'"'s bank re-presents the second bill-of-exchange to the buyer and receives payment.

39. A method according to claim 17 wherein the first bill-of-exchange is electronically generated and electronically transmitted to the buyer, wherein the method is computer-assisted, the first bill-of-exchange being generated by software running on a computer and electronically transmitted to the buyer, wherein the recipient can sign the first bill-of-exchange, indicating acceptance, either by printing out and manually signing the first bill-of-exchange or by signing it electronically.

40. A computer-assisted method of financing a sale of a product traded from a seller to a buyer, the method including computer generation of an event-activated prerelease latent first bill-of-exchange and a second bill-of-exchange and comprising:

a) acceptance by the buyer of the first bill-of-exchange ordering payment for the traded product to be made by the buyer at a maturity date subsequent to the date of acceptance of the first bill-of-exchange wherein the first bill-of-exchange;

i) is drawn by the seller;

ii) is payable to the seller'"'"'s order by a financial institution and is non-negotiable when drawn;

iii) is drawn on the buyer at the financial institution and is executed by the buyer to indicate the buyer'"'"'s acceptance of the payment draft;

iv) sets forth a payment draft activating event, the activating event being effective to render the draft negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain, occurrence of the activating event being agreed by the buyer and seller as commencing the payment term;

v) sets forth a payment term of specified duration, the payment term commencing with the date of occurrence of the activating event, the date of the activating event being a date occurring after execution of the payment draft by the buyer; and

vi) orders a payment of a specified amount of money to be made within the payment term; and

b) delivery of the buyer-accepted first bill-of-exchange to the seller or the seller'"'"'s agent;

c) retention by the seller or the seller'"'"'s agent of the buyer-accepted first bill-of-exchange as collateral for payment for the traded product;

c) acceptance by the buyer of the second bill-of-exchange ordering payment for the traded product to be made at a maturity date no later than the maturity date of the first bill-of-exchange, wherein the first and second bills-of-exchange are interdependent in that each bill-of-exchange is payable only if the other bill-of-exchange is unpaid, and

d) presentation of the second bill-of-exchange to the buyer or the buyer'"'"'s agent to collect payment for the traded product.

41. A method according to claim 40 wherein the first bill-of-exchange has a maturity date determined as a fixed period subsequent to an event and the second bill-of-exchange has the same maturity date as the first bill-of-exchange and wherein the first and second bills-of-exchange are mutually extinguishable, payment of one extinguishing the other.

42. A method according to claim 41 effected by computer-implemented software operational to generate the first and second bills-of-exchange.

43. A computer-assisted trade finance method for financing the sale of a traded product supplied by a seller to a buyer geographically removed from the seller, the method comprising:

a) the seller making an offer to the buyer by providing to the buyer the following computer-generated documents;

i) a pro-forma invoice indicating the identities of the buyer and the seller, the nature of the traded product and an agreed purchase price to be paid by the buyer to the seller for the traded product; and

ii) an event-activated prerelease latent first bill-of-exchange payable to the seller'"'"'s order and drawn on the buyer, the first bill-of-exchange ordering a payment, being payment for the traded product, to be made within a term commencing with a specified activating event intended by the buyer and the seller to occur subsequently to execution of the first bill-of-exchange by the buyer the activating event being effective to render the draft negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain, occurrence of the activating event being agreed by the buyer and seller as commencing the payment term; and

b) the buyer accepting the offer by executing and accepting both the pro-forma invoice and the first bill-of-exchange.

44. A method according to claim 43 wherein the pro-forma invoice and the first bill-of-exchange are separately executed and, subsequently to the activating event, the seller issues an invoice corresponding with the pro-forma invoice and indicating the date of the activating event, and a second bill-of-exchange also satisfying the conditions set forth in clause a) ii) of claim 43 for the first bill-of-exchange.

45. A method according to claim 44 wherein the pro-forma invoice includes:

i) an agreement that the buyer will pay against the first or the second bill-of-exchange to be issued after the activating event; and

ii) a non-recourse agreement to contractually remove trade disputes from the payment cycle.

46. A method according to claim 45 wherein the pro-forma invoice is signed by both the buyer and seller before release of the traded product by the seller.

47. A method according to claim 45 wherein, after the activating event and, if the activating event is not a release of the traded product, after release of the traded product, the seller issues a second bill-of-exchange and wherein the first and second bills-of-exchange are each designated on their faces as being payable only if the other bill-of-exchange remains unpaid, whereby payment of one bill-of-exchange extinguishes the other bill-of-exchange.

48. A method according to claim 47 wherein the first bill-of-exchange, the pro-forma invoice, the invoice and the second bill-of-exchange are all issued by one of the seller and the buyer and wherein the issuing party matches common particulars in the documents to ensure coherence of the documents.

49. A method according to claim 48 comprising, prior to the activating event, a financial institution providing a banker'"'"'s acceptance with respect to the first bill-of-exchange held as collateral.

50. A computer-assisted method for trading a product between a seller and a buyer, the method comprising:

a) said buyer executing a computer-generated pro-forma invoice having indicia indicative of the traded product;

b) said buyer executing a computer-generated event-activated prerelease latent first bill-of-exchange having indicia indicating that the buyer, by acceptance of the first bill-of-exchange, is legally bound to pay for the traded product upon the happening of an activating event and indicating that the first bill-of-exchange;

i) is drawn by the seller;

ii) is payable to the seller'"'"'s order by a financial institution and is non-negotiable when drawn;

iii) is drawn on the buyer at the financial institution and is executed by the buyer to indicate the buyer'"'"'s acceptance of the first bill-of-exchange;

iv) sets forth the activating event, the activating event being effective to render the draft negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain, occurrence of the activating event being agreed by the buyer and seller as commencing the payment term;

v) sets forth a payment term of specified duration, the payment term commencing with the date of occurrence of the activating event, the date of the activating event being a date occurring after execution of the first of exchange by the buyer; and

vi) orders a payment of a specified amount of money to be made within the payment term;

c) said buyer sending to said seller said first bill-of-exchange;

d) said buyer sending to said seller said pro-forma invoice;

e) said seller notifying a financial institution of the receipt by said seller of said buyer-executed first bill-of-exchange and said buyer-executed pro-forma invoice;

f) said financial institution transmitting to said seller a transaction approval;

g) said seller causing said event to happen;

h) said seller issuing;

i) computer-generated invoice enabling the holder of said invoice to obtain said traded product; and

ii) a computer-generated second bill-of-exchange having indicia indicating that the buyer, by acceptance of the second bill-of-exchange, is legally bound to pay for the traded product upon execution of said second bill-of-exchange;

i) said second bill-of-exchange being presented to said buyer, and said buyer executing said second bill-of-exchange;

j) said executed second bill-of-exchange being exchanged for said invoice whereby said invoice is in the possession of the buyer;

k) said seller providing said first bill-of-exchange to said financial institution; and

l) said financial institution issuing a banker'"'"'s acceptance obligating said financial institution to pay said seller.

51. A method as claimed in claim 50, wherein said accepted and executed first bill-of-exchange and said accepted and executed second bill-of-exchange are mutually extinguishable whereby only one of said first and second bills-of-exchange is payable.

52. A method as claimed in claim 51, further comprising:

m) said buyer'"'"'s transaction agent remitting a payment to said financial institution; and

n) said financial institution paying a payment to the holder of said banker'"'"'s acceptance;

said payments in clauses m) and n) substantially corresponding with the value of the traded product, subject to appropriate finance discounts.

53. A method as claimed in claim 51, wherein said event is the release of goods or performance of services, said goods or services comprising the traded product.

54. A method as claimed in claim 51, wherein the event which triggers the legal obligation of said buyer is said seller'"'"'s parting with physical control of said goods or said seller'"'"'s performing said services.

55. A method as claimed in claim 50, wherein said seller notifies a third party administrator respecting the execution and sending of said first bill-of-exchange and said pro-forma invoice and wherein the third party administrator manages and monitors the trade finance process.

56. A computer-implemented method for electronically facilitating a trade transaction wherein a traded product is supplied by a seller to a buyer and wherein the buyer, the seller, a financial institution and a buyer'"'"'s transaction interface are electronically connectable with a packeted electronic information transport system, the method comprising:

a) said buyer electronically sending to said seller first packeted electronic information readable to provide an executed pro-forma invoice having information describing a commercial transaction between said buyer and said seller;

b) said buyer electronically sending to said seller second packeted electronic information readable to provide an executed event-activated prerelease latent first bill-of-exchange having information purporting to legally bind said buyer upon the happening of an event, wherein the first bill-of-exchange;

i) is drawn by the seller;

ii) is payable to the seller'"'"'s order by a financial institution and is non-negotiable when drawn;

iii) is drawn on the buyer at the financial institution and is executed by the buyer to indicate the buyer'"'"'s acceptance of the bill-of-exchange;

iv) sets forth an activating event, the activating event being effective to render the bill-of-exchange negotiable and being selected from the group of events consisting of release of the traded product by the seller, delivery of the traded product to the buyer, availability of specified funds to the buyer, availability of the proceeds of an asset sale to the buyer, in the case of a manufactured traded product, progress of manufacture of the traded product to an agreed stage and of a future date certain, occurrence of the activating event being agreed by the buyer and seller as commencing the payment term;

v) sets forth a payment term of specified duration, the payment term commencing with the date of occurrence of the activating event, the date of the activating event being a date occurring after execution of the first bill-of-exchange by the buyer; and

vi) orders a payment of a specified amount of money to be made within the payment term; and

c) said seller sending a packeted electronic notification to said financial institution regarding the sending of said first and second packeted electronic information;

d) said financial institution transmitting to said seller a packeted electronic transaction approval;

e) said seller causing said activating event to happen;

f) said seller sending to said buyer;

i) third packeted electronic information readable to provide an invoice enabling said buyer to obtain said traded product; and

ii) fourth packeted electronic information readable to provide a second bill-of exchange which upon acceptance legally binds the buyer, said first and second bills-of-exchange being mutually extinguishable;

g) said second bill-of-exchange contained in said fourth packeted electronic information being presented to said buyer and said buyer accepting the terms of said transaction information;

h) said fourth packeted information being electronically updated to include information as to the acceptance of said second bill-of-exchange by said buyer and being sent in exchange for the invoice readable from said third packeted electronic information;

i) said seller electronically transmitting said second packeted electronic information to said financial institution; and

j) said financial institution transmitting fifth packeted electronic information readable to provide a document comprising an order to pay obligating said financial institution to pay said seller.