ACoconut - PIPE Contract

A financial instrument that helps Foundation raise capital through a more flexible option and offered at a discount among selected private investors.

Use Case Description

The system will allow sellers to create new Private Investment in Public Equity (aka. PIPE) issuances, and allow buyers to engage existing PIPE issuance.

Actors

• Seller, who is the asset seller of the PIPE. Usually the Foundation who wants financing from the token assets;

• Buyer, who is the asset purchaser of the PIPE. Usually the token investor;

• Timer Oracle, who is an external timer service provider that provides timing information.

Precondition

• Financial Service Providers have created the PIPE instruments using the NUTS protocol;

Process Flow

Main Process Flow

• Seller creates new issuance of PIPE instrument;

• Seller deposits the issued token to the PIPE issuance;

• Buyers engages the PIPE issuance;

• Buyers deposits the fundraised token to the PIPE issuance. The fundraised token is available for withdrawal by seller;

• When the release date arrives, the issued token is available for withdrawal by the buyer.

Alternative Process Flow

• If seller fails to deposit the issued token in time, the issuance becomes unfunded;

• If buyer fails to deposit the fundraised token in time, the issuance becomes delinquent;

• If there is no engagement in time, the issuance completes with no engagement.

Issuance States

Below are the possible states of a PIPE contract:

• Initiated: The PIPE issuance is created;

• Engageable: The seller deposits the issued token;

• Active: The buyer engages the PIPE issuance;

• Complete Engaged: The release date arrived;

• Unfunded: The seller fails to deposit the issued token in time;

• Complete not Engaged: No buyer engages in time;

• Delinquent: The buyer fails to deposit fundraised token in time.