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Digital Representation of Participation (Patent Pending) is a new Token Standard being put forth by SOAR.

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The TL;DR is as follows

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HOW IT WORKS

Founders ownership in a Company is represented by their percentage of token holdings. AUTHORIZED Tokens (“AT”): 100% of Tokens Authorized represents 100% of the Company’s Value.

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Upon Contract Deployment

ISSUED Tokens (“IT”): 5% of AT (can be Variable) are automatically made available to the public (deployed on to the Bonding Curve and to the Liquidity Pool); CUSTODIAL Wallet (“CW”): a wallet is automatically created that is controllable by the Founder and SOAR only; CUSTODIAL Tokens (“CT”): the remaining 95% of AT (can be Variable) are automatically sent to the CW; Token REQUEST (“TR”): after 3 months from Contract Deployment (can be Variable), Founder may, at its sole discretion, request any portion of the CT, for any purpose or for any reason, as follows:
  • Founder submits a TR to the CW;
  • The TR requires the Founder to identify the Amount of CT being requested, and the Wallet where the CT will be sent;
  • The TR permits, but does not require, the Founder to explain why the TR is being made, and what the TR is going to be used for;
  • The TR is automatically published publicly (on the SOAR platform, on a dedicated SOAR Twitter page, etc);
  • 72 hours later the Amount of tokens requested in the TR are automatically sent to the Wallet identified in the TR.

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SENIOR DEBT Instrument (“SD”)

A legally binding debt agreement, superior as to any and all other claims (third-party or otherwise), is automatically created between SOAR and the Founder’s Company for the amount of the Outstanding Tokens at any given time. The SD is Dynamic such that:
  • Tokens sold by Founder (removed from CW) = SD increases
  • Tokens rebought (buybacks) by Founder (replaced into CW) = SD decreases
OUTSTANDING Tokens (“OT”): the SD entitles SOAR to an amount of value of the Founders Company that is equivalent to AT minus CT (SD = AT - CT). LIQUIDITY EVENT (“LE”): upon the occurrence of a contractually agreed-upon Liquidity Event for the Founders Company (can be Series A/B/C, Exit, Going Public, etc), SOAR is entitled to a financial percentage equal to the SD.

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WHAT IT MEANS

SOAR’s Functional Outcomes of the DRP Token Standard (Patent Pending):
  • Token issuances are akin to Web2:
    • Teams allocate a percentage of tokens to sell;
    • Tokens are deployed on a bonding curve;
    • Remaining tokens (Majority of supply) is locked for 3 months, on behalf of the Founder, to protect consumers and investors.

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Disclosures and Financials

Any project following the DRP Standard will be upheld to the following terms:
  • 3 month lockup on all tokens besides initial offering;
  • Any tokens claimed post-lockup period requires 3 days advance notice;
  • Reasons made for any such claim are made to, and relied upon by, the public — and expose them to potential legal recourse by holders and/or other parties;
  • Quarterly financial reports for businesses, subject to severe legal recourse (ie fraud/misrepresentation).
Upon the occurrence of a liquidity event that causes the Company to provide proceeds to SOAR pursuant to the senior debt obligation, SOAR as the holding company reserves the right to, at its sole discretion, dispose of the proceeds in any number of manners it so chooses: Share value with holders (whether contractually required or not) via:
  • Airdrops
  • Redemptions
  • Inject directly into the chart (buy tokens, potentially burn tokens, etc);
  • Distribute equivalent (or portion) in other tokens;
  • Buyback/Burn other tokens;
  • Etc.

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PUT INTO CONTEXT

Joe owns a startup whiskey company he would like to tokenize and fundraise for. Joe allocates 5% of token supply to the bonding curve and LP. SOAR holds a senior debt for the equivalent of 5% of the whiskey company. 95% of supply is held by SOAR, on behalf of the company. This supply is locked for a minimum of 3 months. Through trading fees, Joe raises $50,000 for his company.

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WHAT’S NEXT FOR JOE?

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3 SCENARIOS

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1) After 6 months, Joe has an ACQUISITION offering

  • Joe is paid for 100% of the business, of which 5% of the value of the acquisition is directed back to SOAR to satisfy the Senior Debt; and
  • SOAR, at its sole discretion can use the capital in any of the ways outlined above; and
  • The relationships end, and all parties benefit.

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2) After 6 months, Joe decides the TOKEN IS NOT VIABLE for the business despite the company being profitable

Joe, retaining majority ownership and with a small portion of supply outstanding, can satisfy the senior debt to SOAR by purchasing all outstanding tokens through a redemption, or other offering that removes all outstanding tokens off the market.

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3) After 6 months, Joe needs to RAISE MORE CAPITAL

  • Joe, with full token and ownership flexibility can approach both traditional investors looking for equity or work with web3 funds or traders who are interested in owning tokens in exchange for cash; or
  • Should Joe go the token route, he notifies holders through the disclosure requirement that he is claiming 5% of tokens, to fund further growth; or
  • Unlike most tokens which have zero flexibility, Joe controls majority stake and thus can find suitable terms that help the business and benefit long-term holders by giving ample runway to the business.