Get the Note - a digital token by Republic, a US company backed by Binance & Neo - page 5.

trimpo

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The Token DPA allows investors to earn interest on the money they lend blockchain companies. With the value of principal of the loan rising due to interest and a promised discount on tokens, investors who hold a Token DPA can receive an advantaged rate on Tokens after a period of time, token distribution offering occurs and the company uses the money responsibility.

Companies provide check-points when investors can request to be paid back, in cash. It should be noted that payment can only be made if the company has retained assets sufficient to service the debt or made money.

republic.sup

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How does the waitlist work?

If the campaign reaches the maximum goal, no more investments can get accepted and all following investment commitments get added to the waitlist.

If one of the earlier investors decides to cancel or doesn’t fund their investment in time, the first person with the matching or lower desired allocation on the waitlist will get their spot.

For example, If space opens up for $1,000 and your waitlisted investment is $1,500, you won't get in, but the person behind you with a $900 waitlisted investment will get in, and the next person with a $100 waitlisted investment or less will get in as well.

republic.sup

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Quote from: Neverlessyou on May 13, 2019, 05:59:22 AM

What kind of startups are accepted to raise?

Only U.S.-based companies are accepted (you have to be incorporated in the US)
Only companies that pass the criteria of our investment committee https://republic.co/learn/investors/how_we_select_startups
More criteria listed here https://republic.co/learn/issuers/who_can_raise

Thanks for the answer. Yes, you are right and thank you for linking to the resource.

Neverlessyou

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Token DPA — an interest bearing loan that can be converted to tokens
When you join a project on Republic Crypto, you typically receive a security called the Token DPA (Debt Payable by Assets) from the company you loaned money to.

As a loan contract between you and a blockchain startup, the Token DPA is the right to receive interest on your loan or have your loan paid back in the future with the token. The ability to have your loan paid back in tokens is contingent on a trigger event, meaning you will not receive tokens unless a token distribution event occurs.

Miriam WolfStavish

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Even as development in the blockchain space is accelerating rapidly, existing regulations make it a risky proposition for token issuers to let everyday people participate in their pre-sales, leaving most people out. Previously, if you weren’t a US accredited investor – meaning you didn’t meet a high income/net worth threshold (3% of the US population), you couldn’t legally participate in public crypto-assets offerings pursuant to Rule 506(c) - also known as Reg D or an advertised private placement. We created the Token DPA, an instrument appropriate for investment crowdfunding, to help change that.

Anyone 18 or older can purchase the Token DPA through a Republic Crypto offering — American or international citizens, accredited or non-accredited investors and even certain types of entities.

Larion Drake

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Quote from: Jon Winston on May 13, 2019, 06:17:50 AM

In the event the start up folds due to insolvency, Token DPA holders may not receive tokens or cash back, but as debt holders they would be entitled to any available assets over equity or SAFT holders, during a dissolution of the business, generally.

A Token DPA can have a hard cap on the time period money may be borrowed in, ensuring that investors’ capital isn’t contributed to a project that won’t materialize within a set period of time.

Companies can customize the Token DPA to include repurchase rights as well as allow for refinancings. Depending on the terms of a company's Token DPA, investors should be aware that repayment in cash or tokens may result in no return.

Jon Winston

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In the event the start up folds due to insolvency, Token DPA holders may not receive tokens or cash back, but as debt holders they would be entitled to any available assets over equity or SAFT holders, during a dissolution of the business, generally.

Heddion

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The Token DPA’s terms can be modified to meet projects’ specific needs, allowing the loan to be paid back in cash or Tokens. For example, you can give your project breathing room by pushing back the date interest accrues. To reward early supporters, you can also ensure investors get preferential pricing on tokens if a token distribution event ever occurs. To make the Token DPA a more flexible instrument than the SAFT, the Token DPA can grant investors (instead of the company) the choice to have all or part of their monies refunded before the loan is paid back. There is no guarantee a company will have the funds to return a investor’s principal, purchasing a Token DPA can result in a total loss.

Fenomenon

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How it works?

The Token DPA sets a time limit for how long a company can hold the funds before paying interest or repaying the debt in tokens. The Token DPA encourages companies to use their funds slowly by giving investors the right to request them back. If the company does not retain the funds then they may become insolvent and will eventually fold. If investors do not request their funds back and never receive their tokens then they can earn interest on their principal. If the company completes its goals, they can repay the debt in tokens, effectively allowing investors to purchase them at a substantially discounted price.

DonyTramp

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Quote from: DivinityEgo on May 13, 2019, 06:07:16 AM

What types of companies use the Token DPA?

We’ve made the Token DPA flexible enough to work for companies at every stage of development––whether they’re ramping up their projects and are looking for early followers or have sufficient funding, are releasing their protocols, and now want to legally involve supporters who might not be accredited investors. Either way, we’ve designed the Token DPA for companies to get tokens into the hands of their users, friends, and followers. Under federal securities law, companies can not publicly sell most tokens (or the rights to tokens) to unaccredited investors without seeking a proper securities registration exemption; otherwise, they risk sanction for improperly selling securities. The Token DPA is an effective instrument to sell the right to tokens to anyone, using Reg CF or other securities exemptions.

DivinityEgo

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What types of companies use the Token DPA?

VincentoDoraimon

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With a standard SAFT, investors must wait for a public token sale or distribution by an issuing company to receive tokens, otherwise their right to a return on their investment can be left unfulfilled, possibly forever. In contrast, the Token DPA provides a method for investors to either receive part or all of their principal back, earn a cash return or receive the desired tokens when certain events occur. It should be noted, these protections rely on the company issuing the Token DPA abiding by its terms, there can be no guarantee of this. For example, if a company issuing a Token DPA spends all of their capital before investors’ right to request a return of capital occurs, investors’ could force the company into insolvency when they make the request.

VeloCHARAPtor

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Our team realized: Who wants an IOU when we have existing established regimes for lending money to projects and leaving deposits on future purchases?

We're primarily concerned with how many SAFT instruments allows investors' token distribution rights to expire without the recourse of being a debtor as well as the inability of investors' to request money back if goals or projects never materialize on the promised schedule. Our team can reduce these concerns with the Token DPA, providing flexible terms favorable to investors’ interests. Despite using a framework for every agreement, each Token DPA is different and investors should read and understand each investment contract before making an investment.

trimpo

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The Token DPA (Debt Payable by Assets) (“DPA”) is a debt security created by the Republic Crypto team specifically for token pre-sales. We've designed the Token DPA with unaccredited and international investors in mind, but we believe it's the best way to pre-sell tokens for any project and for accredited and unaccredited investors alike. Just as we created and open sourced the Crowd SAFE, we’re open sourcing the Token DPA with hopes that it becomes an industry standard to make investing easier and to help support the blockchain ecosystem more broadly. Feel free to send us an e-mail if you’re planning a token pre-sale or have already held one and want to build a larger, more inclusive network of non-accredited investors.

Neverlessyou

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What kind of startups are accepted to raise?

Miriam WolfStavish

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Quote from: Jon Winston on May 13, 2019, 05:55:36 AM

If they're formatted like this example, meaning many of the same items and information (ex. issuance of stock) are covered in the same way, they're probably GAAP. That said, it's not just a question of formatting, and this isn't financial advice. https://republic.co/help/issuer-gaap-example.pdf

Remember, if you want the ability to raise over $107,000, you must have your GAAP finances reviewed by an independent CPA.

Larion Drake

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Quote from: Jon Winston on May 13, 2019, 05:55:36 AM

If they're formatted like this example, meaning many of the same items and information (ex. issuance of stock) are covered in the same way, they're probably GAAP. That said, it's not just a question of formatting, and this isn't financial advice. https://republic.co/help/issuer-gaap-example.pdf

If you're still not sure, it's best to check with a CPA. We recommend using Kristine Rasmussen from Assure ([email protected]). Most startups that have raised on Republic work with Kristine.

Jon Winston

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If they're formatted like this example, meaning many of the same items and information (ex. issuance of stock) are covered in the same way, they're probably GAAP. That said, it's not just a question of formatting, and this isn't financial advice. https://republic.co/help/issuer-gaap-example.pdf

Heddion

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Quote from: Fenomenon on May 13, 2019, 05:50:20 AM

How do I know if my financials are GAAP compliant?

GAAP refers to "generally accepted accounting principles", an industry standard for reporting financial information. To fundraise using Regulation Crowdfunding, you must submit your financial statements in GAAP format.

Fenomenon

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How do I know if my financials are GAAP compliant?

Topic: Get the Note - a digital token by Republic, a US company backed by Binance & Neo - page 5. (Read 3225 times)