Securitization of sales participation certificates

• US 8,442,897 B2
• Filed: 02/14/2005
• Issued: 05/14/2013
• Est. Priority Date: 04/24/2002
• Status: Active Grant

• Current Assignee: Tykhe LLC
• Original Assignee: Tykhe LLC
• Inventors: Schulman, Henry Evan C.
• Primary Examiner(s): Oyebisi, Ojo O
• Application Number:
  US11/057,552
• Publication Number:
  US 20050222940A1
• Time in Patent Office: 3,011 Days
• Field of Search: 705/36.R, 705/35, 705/37, 705/38, 705/39
• US Class Current: 705/37
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 40/04 Trading; Exchange, e.g. stocks, commodities, derivatives or currency exchange

Abstract

The invention relates to financial products that provide a return that is a function of future sales/revenues, preferably gross sales/revenue, over a specified period of time. One embodiment of a method for creating such a financial product includes providing standard forms to an issuer and underwriter and standard terms to an issuer and investors. The terms to the issuer include providing capital to the issuer in exchange for a return that is a function of future sales over a specified period of time. The process further includes creating instruments representing investment in the financial product. The process creates the instruments in sufficient numbers and in appropriate denominations to facilitate trading in the financial product.

Claims

1. A computer-implemented system for preparing to register a sales participation based financial product offering, the system comprising:

a computer-readable storage device for storing instructions; and

a processor in communication with the computer-readable storage device, the processor operative to utilize the instructions stored in the computer-readable storage device for;

receiving information regarding the amount of an issue desired by a potential issuer;

receiving sales information related to current sales and to sales growth rate for one or more organizations;

receiving discount rate information for the issue;

setting a function of future reported sales of the one or more organizations using the desired issue amount information and a present value of estimated future sales of the one or more organizations in setting the function, the present value being based on the sales information and the discount rate information, the function being configured to later determine an amount to be paid to investors based on the future reported sales of the one or more organizations; and

determining a number of tradable instruments representing investment in the financial product, the act of determining comprising;

receiving a fixed denomination for the tradable instruments; and

dividing the issue amount by the fixed denomination to determine the number of tradable instruments.

2. The system of claim 1, wherein the one or more organizations comprise a combination of organizations that have combined to sell claims on their joint future reported sales.

3. The system of claim 1, wherein setting the function of future reported sales comprises using historical growth rates for sales.

4. The system of claim 1, wherein the discount rate information comprises a discount rate that is mutually agreed upon by the issuer and the investors in light of prevailing market conditions.

5. The system of claim 1, wherein the function of future reported sales is a linear function.

6. The system of claim 1, wherein the financial product expires worthless at maturity.

7. The system of claim 1, wherein setting a function of future reported sales comprises setting a function of future reported sales over a specified period of time.

8. The system of claim 1, wherein the future reported sales comprise at least one of:

the future reported sales of the one or more organizations;

the future reported sales of a subsidiary of the one or more organizations; and

the future reported sales of a division of the one or more organizations.

9. The system of claim 1, wherein setting a function of future reported sales comprises setting a function that is a function solely of future sales.

10. The system of claim 1, wherein setting a function of future reported sales comprises setting a function that is a function of future sales and already completed sales.

11. The system of claim 1, wherein the future reported sales of one or more organizations are defined by sales as reported on an income statement of each of the one or more organizations.

12. The system of claim 1, wherein the one or more organizations comprise the issuer.

13. The system of claim 1, wherein the processor is operative to utilize the instructions stored in the computer-readable storage device for calculating a present value of estimated future sales using an iterative calculation.