Corporate Structure

    FIRST MONEY IS LIKE YEAST

I bring $25 million in research value to the table; I need $5 million and five years to file a broad patent.  

 

First Step:  Set up a corporation with one hundred million shares of Class A voting stock, and one hundred million shares of Class B non-voting stock.

 

I get 60 million shares of Class A stock, and the original investors of $5 million split 20 million shares of Class A stock in proportion to their investment.  

20 million shares of Class A stock, and all of the Class B stock, remain in the corporation.  

 

Original investors of $5 million get 80% of after-tax licensing, royalty, or out-right sale revenue, proportionally divided, until they receive 10x their investment value back.  I receive 10 % of after-tax licensing, royalty, or out-right sale revenue, until the original investors receive 10x their investment back, with 10% remaining in the corporation.

 

After original investors earn their 10x back, they then participate in subsequent after-tax licensing, royalty, or out-right sale revenues at a 20% rate, proportionally divided.  

 

Once the original investors earn their 10x back, I receive 60% of any after tax licensing, royalty or out-right sale revenue, and the rest stays in the corporation for use by the corporation and/or distribution to Class B stockholders.  Any subsequent stock sale after the opening round involves Class B stock.

 

  

After setting up the corporate structure, the core people necessary to carry out the required tasks must be assembled.  These people include:

 

Two salaried people.  Myself as CEO of the corporation, and a second person with an administrative role to handle the office work.  Office space would be rented monthly.  All other work would be sub-contracted out on a fee-for-service basis.  See Research Plan for more information on out-sourcing of research.

 

A CPA firm to handle the money and bookkeeping.  All investor funds would go into an escrow account under the control of the CPA, who would disperse the funds as needed by the CEO.  This firm must be selected.

 

A pharmaceutical patent attorney.  This person must be recruited. 

 

Business and contract law attorney to provide counsel on general business matters. This person needs to be recruited.

 

A marketing guru to supervise the marketing of the patent to pharmaceutical candidates.   This person or firm must also be selected.

 

I also intend to form an Advisory Board to provide seasoned advice in a structured environment.  Advisors would be included as the project proceeds.  Attendees to Advisory Board meetings would receive financial compensation for attending meetings and providing their expertise.