WO2006047321A2 - Système et procédé de transfert d'un investissement - Google Patents

Système et procédé de transfert d'un investissement Download PDF

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Publication number
WO2006047321A2
WO2006047321A2 PCT/US2005/037981 US2005037981W WO2006047321A2 WO 2006047321 A2 WO2006047321 A2 WO 2006047321A2 US 2005037981 W US2005037981 W US 2005037981W WO 2006047321 A2 WO2006047321 A2 WO 2006047321A2
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Prior art keywords
entity
distributing
purchaser
divesting
initial
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PCT/US2005/037981
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English (en)
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WO2006047321A3 (fr
Inventor
Emanuel J. Freidman
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Freidman Emanuel J
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Application filed by Freidman Emanuel J filed Critical Freidman Emanuel J
Publication of WO2006047321A2 publication Critical patent/WO2006047321A2/fr
Publication of WO2006047321A3 publication Critical patent/WO2006047321A3/fr

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    • G—PHYSICS
    • G06—COMPUTING; CALCULATING OR COUNTING
    • G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
    • G06Q40/00—Finance; Insurance; Tax strategies; Processing of corporate or income taxes

Definitions

  • the systems and methods of the invention relate to the transfer of investment products, such as stocks, bonds, options or other investments.
  • investment products such as stocks, bonds, options or other investments.
  • Well known in the financial world are various methods and systems for trading shares of ownership in a company, such trading including both acquiring an ownership interest in a company, i.e., an investment, and divesting an ownership in a company.
  • Stock exchanges around the world are centers of activity in the trading of stocks and other investments.
  • known methods and systems fall short of providing an efficient approach to engaging in investment transactions in some situations.
  • known methods and systems fail to provide an efficient approach to trading private unregistered stock in an efficient manner.
  • the invention provides a method and system for distributing, under the control of a distributing entity, a block of investment units, the investment units held by a divesting entity, and constituting an ownership portion of a company.
  • the method may include identifying the block of investment units including a first portion of the block of investment units and a second portion of the block of investment units; effecting transfer of the first portion from the divesting entity to an initial purchaser; and providing a selling option of the second portion to the distributing entity.
  • the selling option includes providing the distributing entity the right to sell the second portion at a future time to a secondary purchaser; and providing the initial purchaser with a contingent value associated with the selling of the second portion.
  • the method further includes selling at least a portion of the second block to the secondary purchaser; generating proceeds from the selling at least a portion of the second block to the secondary purchaser; and distributing the proceeds to the distributing entity, the divesting entity and the initial purchaser.
  • the technical effect of the invention is to provide a method and system for distributing, under the control of a distributing entity, a block of investment units, which are held by a divesting entity and which constitute an ownership portion of a company, and providing various features related thereto.
  • Fig. 1 is a block diagram showing the structure of an option agreement in accordance with one embodiment of the invention
  • Fig. 2 is a high level flowchart showing the process of the inventive economic benefit option (EBO), i.e., an option agreement, in accordance with one embodiment of the invention
  • Fig. 3 is a flow chart showing further details of the "first phase of economic benefit option transaction is effected between the divesting entity (the seller), the distributing entity and the initial purchaser" step of Fig. 2, in accordance with one embodiment of the invention
  • Fig. 4 is a flowchart showing further details of the "second phase of EBO transaction is effected" step of Fig. 2, in accordance with one embodiment of the invention
  • Fig. 5 is a flowchart showing further details of the "proceeds from sale of second portion of shares is distributed" step of Fig. 4, in accordance with one embodiment of the invention;
  • Fig. 6 is a table showing advantages of the option agreement in accordance with aspects of the invention;
  • Fig. 7 is a table illustratively showing a comparison between the option agreement, in accordance with one embodiment of the invention, and alternatives to the option agreement;
  • Fig. 8 is a computer system used to implement the method of the invention in accordance with one embodiment of the invention. DETAILED DESCRIPTION OF THE INVENTION
  • the systems and methods of the invention relate to an option agreement.
  • the option agreement may involve a variety of parties.
  • the option agreement starts with an entity desiring to sell a block of shares in a particular company, for example.
  • This entity may be characterized as the seller.
  • the option agreement also includes initial or primary purchasers, as well as secondary purchasers.
  • the inventive transaction further includes what is herein characterized as a distributing entity.
  • the distributing entity acts as an interim entity between the seller and the purchasers, and in particular the secondary purchasers, as described below.
  • the distributing entity might be an investment bank.
  • the seller owns a block of shares of the common stock of a company.
  • the seller and the distributing entity enter into a placement agreement, i.e., an options agreement.
  • the placement agreement the seller agrees to sell shares to a single or a group of investors, the initial purchasers.
  • the distributing entity acts in the manner of a placement agent in conducting what may be characterized as an initial offering effected between the seller, the initial purchasers and the distributing entity.
  • the initial purchasers may be granted registration rights with respect to the shares pursuant to the agreement.
  • the parties agree on an initial purchase price.
  • the seller agrees to give the distributing entity an option to place all or any part of the seller's remaining shares that are left after the initial purchase, i.e., shares that are not purchased by the initial purchasers. These left over shares might be characterized as the option share.
  • placement option aspect of the options agreement are described.
  • the seller grants to the distributing entity an exclusive option to place all or any part of the option shares.
  • This option may be exercised in whole or in part by the distributing entity on one occasion or on multiple occasions during a predetermined period, i.e., an option period.
  • the predetermined option period may be established in any suitable manner based on the parties agreement. For example, the option period may extend a certain number of days after the effective date of execution of the option agreement. However, the option period may be based on other criteria and may be affected by particular events. Further details of the timing of the option period are described below.
  • the distributing entity, the company and the seller agree that the option shares (placed by the distributing entity upon the distributing entity's exercise of the option) are to be offered and sold by the seller pursuant to what may be characterized as a secondary placement agreement.
  • the distributing entity and the seller further agree that the sale of the option shares (under the secondary placexnent agreement) will be negotiated in good faith among the seller and the distributing entity in substantially the same form as the initial placement agreement, i.e., the placement agreement that controlled the initial sale of shares to the initial purchasers.
  • the secondary placement agreement may allow for various modifications.
  • it may be that the option shares have been registered with the Securities and Exchange Commission or other governing body at the time of exercise of the option.
  • the secondary placement agreement may allow appropriate modifications as are necessary to accommodate a secondary public offering if the option shares have been registered at the time of exercise.
  • Such modifications may include such representations, warranties and agreements as are customary in a public offering, and which otherwise would not be needed.
  • the distributing entity may advise the seller of this desire in a suitable manner, e.g., in writing. Thereafter, seller shall exercise any registration rights pursuant to which seller is entitled to register the option shares for resale with the Securities and Exchange Commission, or some other appropriate governmental entity.
  • the secondary placement agreement may dictate that the seller and the company each agrees to use its commercially reasonable efforts to cause the option shares to become registered with the Securities and Excliange Commission, for example, in a suitable time frame.
  • the option shares shall be offered and sold to secondary purchasers at a suitable price, e.g., the market price determined in good faith by the distributing entity.
  • the distributing entity may take into account a variety of criteria. For example, the distributing entity may take into account the then-current trading price of common stock of the company on the New York Stock Exchange (or some other exchange), the number of option shares to be placed, and the impact of the sale on the trading price of the common stock of the company on the particular exchange.
  • the distributing entity is mandated not to offer or sell the option shares to secondary purchasers at a price lower than the initial purchase price, i.e., the price at which shares were offered to the initial purchasers.
  • the option agreement establishes the manner in which the proceeds from the sale of the option shares shall be distributed.
  • the total proceeds received by the distributing entity from purchasers of option shares at any settlement time shall be allocated and distributed as follows.
  • the seller shall receive the market price, less a placement fee.
  • the distributing entity shall receive the placement fee for each option share sold.
  • the seller shall make a distribution to the Initial Purchasers in accordance with the option agreement. For example, the seller may distribute the amount, if any, by which the market price per option share sold exceeds the initial purchase price.
  • the distributing entity receives a placement fee.
  • the placement fee is negotiated in the negotiation of the option agreement.
  • the seller pays the distributing entity a particular placement fee for each option share sold by it pursuant to any exercise by the distributing entity of the option.
  • the placement fee may be payable at the time of sale of each option share.
  • the option agreement may set forth clauses relating to registration rights. For example, the option agreement may set forth that any option shares sold pursuant to a private offering will be deemed to be registrable shares under a suitable registration rights agreement and the holders thereof shall have all of the same rights with respect to all option shares held by them that the initial purchasers have under the registration rights agreement with respect to the initial shares. Accordingly, in this manner, the option agreement puts the secondary purchasers in the same stead as the initial purchasers.
  • the option period may be dependent on a variety of factors and may be extended in some situations. However, at some point in time, the option period of the option agreement will terminate. Upon the expiration of the option period, the option will terminate and the distributing entity will then have no further rights to place any option shares. For example, option shares might be considered to be within the option period if the seller and/or the company have received an option Notice within the option period, in accordance with one embodiment of the invention. In accordance with aspects of the invention, the option agreement may set placement restrictions on the sale of the option shares.
  • each purchaser of option shares may be required to represent that (a) such purchaser does not, and will not following the purchase of option shares, beneficially own individually or together with any of such purchaser's affiliates, more than ten percent (10%) of the company's issued and outstanding shares of common stock, and (b) is not, and will not be following the purchase of option shares, a member of a "group" (as defined in Rule 13d-5 under the Exchange Act) beneficially owning more than ten percent (10%) of the company's outstanding shares of common stock, and/or other placement restrictions as may be deemed appropriate.
  • Fig. 1 is a block diagram showing the structure of an option agreement in accordance with one embodiment of the invention.
  • Fig. 1 shows the various parties to an option agreement 100.
  • Fig. 1 shows a seller 10 who might be characterized as a divesting entity.
  • the seller 10 owns a block of investment units (shares) 22 in a company 20.
  • the seller 10 determines that the seller wishes to liquidate the block of shares 22. Accordingly, in practice of trie invention, the seller 10 coordinates with the distributing entity 30 to effect a transaction using the option agreement of the present invention.
  • company as used herein is understood to mean any entity organized such that a person or group might acquire assets in such entity and subsequently divest such assets, such as in the form of selling the person's or group's stock shares in the entity, for example.
  • the seller 10 vis-a-vis the company 20, as described herein may encompass a wide variety of situations relating to investment products, such as stocks, bonds, options or other investments.
  • the seller 10 might simply be an owner of stock in the company 20.
  • the seller 10 might be an investment bank coordinating with the company 20 to effect an issuance or other transacting of stock.
  • a first block or portion of shares 22 is sold to an initial purchaser 40.
  • This transaction which is a part of the option agreement, may be controlled by an initial placement agreement.
  • the initial purchaser 40 purchases these initial shares in conjunction with securing a contingent value in further shares sold in the future, i.e., to secondary purchasers.
  • This sale of such further shares, i.e., option shares 26 is shown in Fig. 1 is sold to secondary purchasers 50.
  • the distributing entity 30 controls the price, timing and amoimt of the option shares (26).
  • the option shares 26 may be sold to the secondary purchasers 50 under a secondary placement agreement.
  • the sale of the option shares 26 generates proceeds 70.
  • the proceeds 70 are distributed as shown in Fig. 1, in accordance with one embodiment of the invention.
  • the distributing entity 30 receives a placement fee, as shown by funds transfer 74. Further, the seller 10 receives the market price at which the option shares 26 were sold to the secondary purchasers 50, less the placement fee, as shown by funds transfer 72. Fuirther, as shown by funds transfer 76, the initial purchaser 40 receives a contingent value, for example, the market price at which the option shares 26 were sold to the secondary purchaser 50 over the initial purchase price, i.e., the contingent value would be the difference berrween (1) the market price at which the option shares 26 were sold to the secondary purchase! 50, and (2) the initial purchase price at which the initial purchaser 40 bought the initial sha,res 24.
  • Fig. 1 is illustrative.
  • Fig. 2 is a high level flowchart showing the process of the inventive economic " benefit option (EBO) in accordance with one embodiment of the invention.
  • EBO inventive economic " benefit option
  • step 210 the divesting company (seller) 10 wishes to effect the sale of an investment 22 in a private company 20.
  • the divesting company (seller) 10 approaches a distributing entity 30 to assist in a private transaction to divest the investment 22.
  • the distributing entity 30 might be in the form of an entity that performs investment banking, institutional brokerage, asset management, and private client services, for example.
  • step 230 the first phase of the option agreement transaction is effected between the divesting entity 10, the distributing entity 30 and the initial purchaser 40.
  • this first phase which includes an initial purchase, are described above.
  • Fig. 3 shows further details of the initial purchase.
  • a period of time passes by, as reflected in step 24-0.
  • step 240 the process passes to step 250.
  • step 250 the second phase of the option agreement transaction is effected between the divesting entity and the secondary purchaser. Specifically, further shares, i.e., option shares 26, are sold to a secondary purchaser 50. Fig. 4 shows further details of this second phase.
  • step 260 the option agreement process of the invention ends.
  • Fig. 3 is a flow chart showing further details of the "first phase of economic benefit option transaction is effected between the divesting entity (the seller), the distributing entity and the initial purchaser" step of Fig. 2, in accordance with one embodiment of the invention.
  • the process starts in step 230 and passes to step 232.
  • step 231 a first portion of the block of shares is transferred from the divesting entity 10 to the initial purchaser 40.
  • the first phase of the option agreement process further includes an option to sell a second portion of the block of shares 26 being provided to the distributing entity. Also, as reflected in step 235 of Fig.
  • the first phase of the option agreement further includes the initial purchaser being provided with a contingent value in the future sale of the second portion of shares. Also, as shown in step 236, the distributing entity 30 is provided with control over the price, timing and amount of the future sale of the second portion of shares. After step 236 of Fig. 3, the process passes to step 238. In step 238, the process returns to step 240 of Fig. 2.
  • Fig. 4 is a flowchart showing further details of the "second phase of EBO transaction is effected" step of Fig. 2, in accordance with one embodiment of the invention.
  • the sub-process starts in step 250 and passes to step 251.
  • the distributing entity 30 approaches various potential purchasers to secure sale of the second portion 26 of the block of shares, using its best efforts.
  • the distributing entity 30 indeed secures the sale of the second portion of the block of shares 26 (or at least a portion of the shares 26) to a secondary purchaser.
  • the distributing entity 30 effects the sale to the secondary purchasers 50 negotiating price, timing and amount of the sale of shares.
  • the shares may be sold to the secondary purchasers 50 at market price, subject to adjust based on a variety of factors, such as volume or timing, for example.
  • step 253 the process passes to step 253.
  • step 253 the proceeds from trie sale of the second portion of shares is distributed.
  • Fig. 5 shows further details of the proceeds of the sale. Then, the process passes to step 254.
  • step 254 the process decides if all the second portion of the block of shares have been sold to secondary purchasers, i.e., are there any more option shares 26 for the distributing entity 30 to place? If no, i.e., there are there more option shares 26 for the distributing entity 30 to place, then the process of Fig. 4 passes to step 255. In step 255, the distributing entity 30 continues to work with potential purchaser's to secure sale of the second portion of the block of shares. After step 255, the process passes to step 256. Step 256 reflects that at some point the negotiated date for the option will expire, i.e., the distributing entity 30 will no longer have the right to sell the option shares 26 to secondary purchasers 50.
  • step 257 the process asks whether further secondary purchasers 50 have been identified. If yes, i.e., the distributing entity 30 has identified further secondary purchasers 50, the process returns to step 252, and continues as described above. Alternatively,, in step 257, the distributing entity 30 may not have identified any further purchasers. As a result, the process returns to step 255, in which the distributing entity 30 continues to work witli secondary purchasers 50 to secure sales of the option shares 26.
  • step 254 it may be the situation that all the second poxtion of the block of shares been sold to secondary purchasers. Accordingly, the process of Fig. 4 passes to step 258.
  • step 258 the option agreement process is wrapped up between the distributing entity 30 and the seller 10, as well as the other parties. This wrap-up process may include a variety of tasks, as should be understood, such as the final completion of paper work, an accounting of the sale of the block of shares 22, as well as other ancillary matters.
  • step 256 the process determines if the option period lias expired. If the option period h.as indeed expired, the process also passes to step 258. After step 258, the process of Fig. 4 passes to step 259. In step 259, the process returns to step 260 of Fig. 2.
  • Fig. 5 is a flowchart showing further details of the "proceeds from sale of second portion of shares is distributed" step of Fig. 4, in accordance with one embodiment of the invention.
  • the process starts in step 253 and passes to step 262.
  • the seller 10 receives market price less the negotiated placement fee, i.e., the fee for the services of the distributing entity 30.
  • the process passes to step 266.
  • step 266 the initial purchaser 40 receives the contingent value through the option agreement, which effectively lowers the cost basis of the initial purchase price.
  • the initial purchaser 40 receives the difference in the market price (at which the option shares 26 were sold) over trxe initial purchase price.
  • the contingent value may be based on a per share value of the spread between the execution price of the initial tranche and the subsequent tranche or tranches, i.e., the sale to the initial purchaser 40 and the sale to the secondary purchasers 50, respectively. Further, the contingent value may also be based o>n a multiplier effect calculated as trie ratio of the number of shares sold in the subsequent offering divided by the number of shares sold in the initial offering. That is, for example, as such ratio increases, the contingent value to the initial purchaser 40 may increase since the initial purchaser 40 has undertook more of a risk.
  • the invention provides a method to effect the sale of a significant private investment in a public company.
  • the invention may effect the privateLy-placed transaction of either primary or secondary shares.
  • the invention may provide an initial purchaser with a fixed price at a negotiated discount to market price.
  • the distributing entity 30 may be mandated to use "best efforts" to provide registration rights within a fixed filing time frame.
  • the option agreement is controlled by the distributing entity to sell a block of equity in future. The option expires upon a negotiated date.
  • the distributing entity 30 determines price, timing, and amount of future sales, i.e.., sales of the option shares.
  • the initial buyer receives contingent value through the option agreement (EBO) which effectively lowers the cost basis of the initial purchase price.
  • EBO option agreement
  • Tfciis lowering of the cost basis may be based on (1) a per share value of the spread between the execution price of the initial tranche and the subsequent tranche or tranches, and/or (2) a multiplier effect calculated as the ratio of the number of shares sold in the subsequent offering divided by the number of shares sold in the initial offering.
  • Fig. 6 is a table showing some of the benefits.
  • the EBO as coined above, creates "value for company, provides orderly exit for controlling shareholder, eliminates discount in stock price due to a control shareholder, eliminates overhang in stock, increases float which often creates appreciation in underlying stock, and provides for quick execution, e.g. (30 days).
  • the EBO beneficially creates value for selling shareholder. That is, unregistered shares sold quickly at the best price available.
  • the EBO provides the ah>ility to liquidate assets in tranches without affecting market price of underlying stock. Further, the
  • EBO provides shorter timing and better pricing than a typical registered secondary.
  • the EBO creates value for buyers.
  • the distributing entity may place the stock with long-term investors of the distributing entity, who then receive the benefit of the
  • the EBO may be closely monitored by the distributing entity. Specifically, the distributing entity may control the Economic Benefit Option (EBO) to protect the company, seller, and buyers.
  • EBO Economic Benefit Option
  • the EBO as described herein may be utilized in a variety of situations. However, in further illustration of the invention, there are certain factors that might make use of ttie EBO particularly attractive. These factors might include (1) that the company has a large/concentrated position, of a single/few shareholders; (2) that a significant shareholder is a motivated seller seeking trie best price available; and that (3) the significant shareholder prefers to negotiate execution price ahead of offering, rather than be subject to marked fluctuations.
  • Fig. 7 is a table illustratively showing a comparison between the option agreement (EBO), in accordance with one embodiment of the invention, and alternatives to the option agreement. Specifically, Fig. 7 shows aspects of timing, restrictions, pricing and investors. The comparison is drawn between one embodiment of the EBO described herein vds-a-vis other types of divestitures, i.e., a traditional secondary and a rule 144.
  • processing as described herein may well be and typically is implemented with the utilization of a computer system.
  • a computer system or systems may be used to effect the transfer of investment units between entities, ef ⁇ ect the transfer of funds associated the divestiture or sale of investment units, and/or effect processing to determine the amount of funds that should be allocated to the various parties, as described herein.
  • the various processing as described herein may be performed using a computer system.
  • Fig. 8 is a computer system 300 used to implement the method of the invention.
  • the computer system 300 may be in the form of particular computer components, i.e., hardware components.
  • the computer system 300 may take the form of a computer readable medium.
  • the computer system 300 is under the control of a distributing entity 30 , for distributing a block of investment units.
  • the investment units may be held by a divesting entity and constitute an ownership portion of a company.
  • the computer system 300 may include a first processing portion 310 that inputs information regarding the block of investment units.
  • a second processing portion 320 is used in effecting a transfer of the first portion from the divesting entity to an initial purchaser.
  • the transfer of the first portion to the initial purchaser includes the conveyance of a contingent value to the initial purchaser.
  • the computer system 300 also includes a third processing portion 330.
  • the third processing portion 330 is used in effecting a transfer of the second portion of investment units, e.g., stocks, from the divesting entity to a secondary purchaser.
  • the transfer of the second portion of investment units is done in accordance with the distributing entity 30 exercising the placement option under the option agreement. That is, the transfer of the second portion effects fulfillment, by the distributing entity, of the option to sell a second portion to the secondary purchaser. This sale to the secondary purchaser results in the generation of proceeds.
  • the computer system 300 further includes a fourth processing portion 340 for processing the proceeds.
  • the fourth processing portion 340 effects the distribution, of the proceeds to the distributing entity, the divesting entity, and the initial purchaser. Io particular, the fourth processing portion 340 effects the distribution of proceeds as shown in transfers (72, 74 and 76) of Fig. 1.
  • the computer system 300 may be used to perform the process of Fig. 1, as well as the processing shown in th.e flowcharts of Figs. 2-5.
  • the computer system 300 includes an input portion 352 and an output portion 354.
  • the input portion 352 may be used to input a wide variety of information into the computer system 300, so as to practice the invention, as shown in Figs. 1-5, for example.
  • Such information might include the parameters of the option agreement 100, particular regarding the various parties, particulars regarding the transfer of funds, as well as any other information needed to practice the invention as discussed herein.
  • further details of the timing of the option period are described.
  • the option period may extend a certain number of days after trie effective date of the option agreement. It is understood that various particulars of the option agreement 100, in accordance with one embodiment of the invention, may be controlled by a contract between some or all of the parties. Under this contract, and as described above, by the option agreement, the seller 10 grants to the distributing entity 30 an exclusive option to place all or any part of the option shares. The option may be exercised in whole or in part by the distributing entity 30 on one or more occasions at any time during the option period.
  • Option (a) Option.
  • Seller hereby grants to Distributing Entity an exclusive option to place all or any part of the Option Shares (the "Option").
  • the Option may be exercised in whole or in part by Distributing Entity on one or more occasions at any time during the period ending the sooner of (i) [120] days following the date hereof, or (ii) [60] days following the date that the registration statement relating to the Shares purchased in the Initial Offering becomes effective in accordance with the Registration Rights Agreement (the "Option Period”), as it may be extended as described below, upon written notice by Distributing Entity to Seller and the Company (each, an "Option Notice"), which notice shall be provided no later than five (5) business days prior to the date on which the placement agreement is to be executed and delivered.
  • Distributing Entity agrees to use, during the Option Period, as it may be extended as described below, subject to the terms hereof and applicable law, rules and regulations, commercially reasonable efforts to place all of the Option Shares as promptly as reasonably practicable on the terms provided herein.
  • Distributing Entity shall not be required to use efforts to place, and shall not be entitled to exercise the Option to place, any Option Shares (i) in a private offering (a "Private Offering") that is not registered under the Securities Act of 1933, as amended (the "Act"), during any period of time or in any manner that would, in the reasonable and good faith judgment of Seller or the Company, upon advice of their counsel, after consulting with and considering the advice of counsel to Distributing Entity, create a risk that the Private Offering would be required to be registered under the Act or would not otherwise comply with applicable securities laws or regulations and that makes it inadvisable to proceed with a Private Offering at such time or in such manner, (ii) in a.
  • Public Offering a public offering that is registered under the Act during any period of time or in any manner that would, in the reasonable and good faith judgment of Seller or the Company, upon advice of their counsel, after consulting with and considering the advice of counsel to Distributing Entity, (A) create a risk that a previous or concurrent Private Offering or attempted Private Offering of securities of the Company would be required to be registered under the Act or (B) not otherwise comply with applicable securities laws or regulations and that, in the case of each of clauses (A) and (B), makes it inadvisable to proceed with a Public Offering at such time or in such manner, or (iii) during any period of time (but in no event to exceed 60 days in the aggregate) that the Company reasonably and in good faith determines that it would be impracticable or inadvisable to proceed with an offering of Option Shares at such time because of any pending discussions relating to, or the consummation of, a.
  • the EBO provides advantageous to all parties, including the company, the seller, and the buyer.
  • the EBO is applicable to primary and secondary shares.
  • the EBO can facilitate additional capital needs of a company, and also remove incentive for initial buyers to hedge/short, i.e., in that institutional investors with long term interest in company would be protected, and (b) shorting would be counter-productive by reducing the value of the EBO.
  • the EBO may further enable larger placement than otherwise possible without the EBO structure.
  • FIG. 8 shows one embodiment of a system of the invention. Further, Figs. 2-5 show various steps of one embodiment of "the method of the invention. Hereinafter, general aspects regarding implementation of the systems and methods of the invention will be described.
  • system of the invention or portions of the system of the invention, such as the computer system 300 of Fig. 8, may be in the form of a "processing machine,” such as a general purpose computer, for example.
  • processing machine such as a general purpose computer, for example.
  • processing machine is to be understood to include at least one processor that uses at least one memory.
  • the at least one memory stores a set of instructions.
  • the instructions may be either permanently or temporarily stored in the memory or memories of the processing machine.
  • the processor executes the instructions that are stored in the memory or memories in order to process data.
  • the set of instructions may include various instructions that perform a particular task or tasks, such as those tasks described above in the flowcharts. Such a set of instructions for performing a particular task may be characterized as a program, software program, or simply software.
  • the processing machine executes the instructions that are stored in the memory or memories to process data.
  • This processing of data may be in response to commands by a user or users of the processing machine, in response to previous processing, in response to a request by another processing machine and/or any other input, for example.
  • the processing machine used to implement the invention may be a general purpose computer.
  • the processing machine described above may also utilize any of a wide variety of other technologies including a special purpose computer, a computer system including a microcomputer, mini-computer or mainframe for example, a programmed microprocessor, a micro-controller, a peripheral integrated circuit element, a CSIC (Customer Specific Integrated Circuit) or ASIC (Application Specific Integrated Circuit) or other integrated circuit, a logic circuit, a digital signal processor, a programmable logic device such as a FPGA, PLD, PLA or PAL, or any other device or arrangement of devices that is capable of implementing the steps of the process of the invention.
  • a special purpose computer a computer system including a microcomputer, mini-computer or mainframe for example, a programmed microprocessor, a micro-controller, a peripheral integrated circuit element, a CSIC (Customer Specific Integrated Circuit) or ASIC (Application Specific Integrated Circuit) or other integrated circuit, a logic circuit, a digital signal
  • each of the processors and/or the memories of ttie processing machine may be located in geographically distinct locations and connected so as to communicate in any suitable manner.
  • each of the processor and/or the memory may be composed of different physical pieces of equipment. Accordingly, it is not necessary that the processor be one single piece of equipment in one location and that the memory be another single piece of equipment in another location. That is, it is contemplated that the processor may be two pieces of equipment in two different physical locations. The two distinct pieces of equipment may be connected in any suitable manner.
  • the memory may include two or more portions of memory in two or more physical locations.
  • processing as described above is performed by various components and various memories.
  • tkie processing performed by two distinct components as described above may, in accordance with a further embodiment of the invention, be performed by a single component.
  • processing performed by one distinct component as described above may be performed by two distinct components.
  • the memory storage performed by two distinct memory portions as described above may, in accordance with a further embodiment of the invention, be performed by a single memory portion.
  • the memory storage performed by one distinct memory portion as described above may be performed by two memory portions.
  • various technologies may be used to provide communication between the various processors and/or memories, as well as to allow the processors and/or the memories of the invention to communicate with any other entity; i.e., so as to obtain further instructions or to access and use remote memory stores, for example.
  • Such technologies used to provide such communication might include a network, the Internet, Intranet, Extranet, LAN, an Ethernet, or any client server system that provides communication, for example.
  • Such communications technologies may use any suitable protocol such as TCP/IP, UDP, or OSI, for example.
  • the set of instructions may be in the form of a program or software.
  • the software may be in the form of system software or application software, for example.
  • the software might also be in the form of a collection of separate programs, a program module within a larger program, or a portion of a program module, for example
  • the software used might also include modular programming in the form of object oriented programming.
  • the software tells the processing machine what to do with the data being processed.
  • trie instructions or set of instructions used in the implementation and operation of the invention may be in a suitable form such that the processing machine may read the instructions.
  • the instructions that form a program may be in the form of a suitable programming language, which is converted to machine language or object code to allow the processor or processors to read the instructions. That is, written lines of programming code or source code, in a particular programming language, are converted to machine language using a compiler, assembler or interpreter.
  • the machine language is binary coded machine instructions that are specific to a particular type of processing machine, i.e., to a particular type of computer, for example. The computer understands the machine language.
  • any suitable programming language may be used in accordance with the -various embodiments of the invention.
  • the programming language usedma/y include assembly language, Ada, APL, Basic, C, C++, COBOL, dBase, Forth, Fortran, Jarva, Modula- 2, Pascal, Prolog, REXX, Visual Basic, and/or JavaScript, for example.
  • assembly language Ada
  • APL APL
  • Basic Basic
  • C C++
  • COBOL COBOL
  • dBase Forth
  • Fortran Fortran
  • Jarva Modula- 2
  • Pascal Pascal
  • Prolog Prolog
  • REXX REXX
  • Visual Basic Visual Basic
  • JavaScript JavaScript
  • the instructions and/or data used in the practice of the invention may utilize any compression or encryption technique or algorithm, as may be desired.
  • An encryption module might be used to encrypt data.
  • files or other data may be decrypted using a suitable decryption module, for example.
  • the invention may illustratively be embodied in the form of a processing machine, including a computer or computer system, for example, that includes at least one memory.
  • the set of instructions i.e., the software for example, that enables the computer operating system to perform the operations described above may be contained on any of a wide variety of media or medium, as desired.
  • the data that is processed by the set of instructions might also be contained on any of a wide variety of media or medium. That is, the particular medium, i.e., the memory in the processing machine, utilized to hold the set of instructions and/or the data used in the invention may take on any of a variety of physical forms or transmissions, for example.
  • the medium maybe in the form of paper, paper transparencies, a compact disk, a DVD, an integrated circuit, a hard, disk, a floppy disk, an optical disk, a magnetic tape, a RAM, a ROM, a PROM, a EPROM, a wire, a cable, a fiber, communications cha ⁇ inel, a satellite transmissions or other remote transmission, as well as any other medium or source of data that may be read by the processors of the invention.
  • the memory or memories used in the processing machine that implements the invention may be in any of a wide variety of forms to allow the memory to hold instructions, data, or other information, as is desired.
  • the memory might be in the form of a, database to hold data.
  • the database might use any desired arrangement of files such as a flat file arrangement or a relational database arrangement, for example.
  • a user interface includes any hardware, software, or combination of hardware and software used by the processing machine that allows a user to interact with the processing machine.
  • a user interface may be in the form of a dialogue screen for example.
  • a user interface may also include any of a mouse, touch screen., keyboard, voice reader, voice recognizer, dialogue screen, menu box, list, checkbox, toggle switch, a pushbutton or any other device that allows a user to receive information regarding the operation of the processing machine as it processes a set of instructions and/or provide the processing machine with information.
  • the user interface is any device that provides communication between a user and a processing machine.
  • the information provided by the user to the processing machine through the user interface may be in the form of a command, a selection of data, or some other input, for example.
  • a user interface is utilized by the processing machine that performs a set of instructions such that the processing machine processes data for a user.
  • the user interface is typically used by the processing machine for interacting with a user either to convey information or receive information from the user.
  • the user interface of trxe invention might interact, i.e., convey and receive information, with another processing machine, rather than a human user. Accordingly, the other processing machine might be characterized as a user.
  • a user interface utilized in the system and method of the invention may interact partially with another processing machine or processing machines, while also interacting partially with a human user.

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  • Economics (AREA)
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  • Marketing (AREA)
  • Strategic Management (AREA)
  • Technology Law (AREA)
  • Physics & Mathematics (AREA)
  • General Business, Economics & Management (AREA)
  • General Physics & Mathematics (AREA)
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  • Financial Or Insurance-Related Operations Such As Payment And Settlement (AREA)

Abstract

L'invention concerne un procédé et un système de distribution, sous le contrôle d'une entité de distribution, un bloc d'unités d'investissement, les unités d'investissement étant détenues par une entité de déssaisissement et constituant une partie des actifs d'une société. Le procédé peut consister à: identifier le bloc d'unités d'investissement constitué d'une première partie des unités d'investissement et d'une seconde partie des unités d'investissement; transférer la première partie des unités de l'entité de déssaisissement à un acquéreur initial; et fournir une option de vente de la seconde partie à l'entité de distribution. L'option de vente consiste à: conférer à l'entité de distribution le droit de vendre ultérieurement la seconde partie des unités à un acquéreur secondaire; et fournir à l'acquéreur initial une valeur inhérente associée à la vente de la seconde partie des unités. Le procédé consiste en outre à: vendre au moins une partie des unités du second bloc à l'acquéreur secondaire; générer des produits de cette vente à l'acquéreur secondaire; et distribuer ces produits à l'entité de distribution, à l'entité de déssaisissement et à l'acquéreur initial.
PCT/US2005/037981 2004-10-21 2005-10-21 Système et procédé de transfert d'un investissement WO2006047321A2 (fr)

Applications Claiming Priority (4)

Application Number Priority Date Filing Date Title
US96935804A 2004-10-21 2004-10-21
US10/969,358 2004-10-21
US20236105A 2005-08-12 2005-08-12
US11/202,361 2005-08-12

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WO2006047321A2 true WO2006047321A2 (fr) 2006-05-04
WO2006047321A3 WO2006047321A3 (fr) 2008-11-13

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Cited By (2)

* Cited by examiner, † Cited by third party
Publication number Priority date Publication date Assignee Title
US8782770B1 (en) 2013-12-10 2014-07-15 Citigroup Technology, Inc. Systems and methods for managing security during a divestiture
US20140330693A1 (en) * 2013-05-01 2014-11-06 Keith Siilats Systems and methods for auctioning asset backed securities

Citations (2)

* Cited by examiner, † Cited by third party
Publication number Priority date Publication date Assignee Title
US20030163400A1 (en) * 2001-06-29 2003-08-28 Ivan Ross Method for structuring an obligation
US20040039685A1 (en) * 1999-06-15 2004-02-26 W.R. Hambrecht + Co., A California Corporation Auction system and method for pricing and allocation during capital formation

Patent Citations (2)

* Cited by examiner, † Cited by third party
Publication number Priority date Publication date Assignee Title
US20040039685A1 (en) * 1999-06-15 2004-02-26 W.R. Hambrecht + Co., A California Corporation Auction system and method for pricing and allocation during capital formation
US20030163400A1 (en) * 2001-06-29 2003-08-28 Ivan Ross Method for structuring an obligation

Cited By (2)

* Cited by examiner, † Cited by third party
Publication number Priority date Publication date Assignee Title
US20140330693A1 (en) * 2013-05-01 2014-11-06 Keith Siilats Systems and methods for auctioning asset backed securities
US8782770B1 (en) 2013-12-10 2014-07-15 Citigroup Technology, Inc. Systems and methods for managing security during a divestiture

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