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FAQ
Knowledge

SongShares

What are SongShares?


SongShares are fractional shares of royalty streams, and an exciting new way for anyone to buy a stake in the royalties of songs they love and share in the income. The company is the first to utilize Regulation A+ of the U.S. Securities and Exchange Commission in order to sell music royalties in SongShares which are “royalty share units.” In each offering, SongVest experts work with a seller to evaluate their catalog, determine the limited number of royalty share units to be sold, and create a listing.




What is a VIP Auction?


For each offering, SongVest holds a non-binding VIP ("Verify Interest of Participation") Auction with potential investors to price the interests in the offering of royalty share units. It is also referred to as a "Test The Waters" auction under Tier 2 of Regulation A of the Securities Act and the offering circular. The unique bidding process is how potential investors collectively set the final price per unit for an offering. Registered fans can start bids at a minimum of $20 per royalty share unit with no commitment to buy. Bidders can reserve SongShares with an option to purchase them during the official VIP Sale held after SEC qualification of the offering. During the auction, participants will bid on SongShares, until all have been reserved, and the price will increase by $1. You will need to watch your bids to confirm your priority and that you do not get outbid before the auction ends! Typically the auction will run from 9amPT/12pmET and end the next day at 6pm PT/9pm ET. This may change occassionallly, the detailed auction listing will always have the most up-to-date information.




How Does Bidding Work?


Watch a video explanation During the VIP Auction period, participants can make non-binding bids on a fractional share of the royalty stream. The number of royalty share units available will vary for each auction. Once all units have sold out at a certain price, it will automatically increase by $1 and allow for more bids on the total number of SongShares. This will repeat with price increasing until time runs out and more bids are made. Bidders can place either HARD bids or PROXY bids. HARD bids are immediate bids at the current price for a specific number of units. A PROXY bid is when you set a maximum price and number of units you would purchase and the system will automatically bid for you if the price increases. SongVest’s auction platform shows bidders the current price and bid status, and then will notify them if they are outbid. When the VIP Auction is over, the price will be set at the highest amount achieved when all were SOLD OUT. If only half of the units were sold at $20, then the final set price would be $19. After the auction and SEC qualification, all participants with successful bids of SongShares will have the option to purchase the units before the general public offering!




What Happens at the End of the VIP Auction?


SongVest uses the Five Minute Rule for auctions, whereby if a bid is placed in the final five minutes of an auction the listing will stay open for an additional five minutes. There is no limit to the number of times an auction can be extended. Soso we recommend that bidders check back often as an auction nears closing time. When the auction has officially come to a close, the listing will indicate “Auction is Closed”. SongVest makes every effort to ensure system availability. However, we reserve the right to (in rare cases) close an auction prior to, or extend it beyond, the posted closing time. This may be done at our discretion and without warning. SongVest is not responsible for incomplete, failed, garbled, scrambled, delayed or misdirected computer transmissions due to technical computer hardware or software failures or other errors of any kind. If you have a successful bid at the end of the VIP Auction, you will have the option to purchase those SongShares during the VIP Sale before the general public, and after it is qualified by the SEC.




What Happens if I Win a VIP Auction?


If you have a successful bid at the end of the VIP Auction, you will have the option to purchase those SongShares during the VIP Sale before the general public, and after the offering qualified by the SEC. You may purchase up to as many royalty units as you reserved during the Auction. For example, if you reserved 50 SongShares, you can purchase 1, 2, 10, or any quantity up to 50 units.




What is a VIP Sale or Public Sale?


After a VIP Auction is complete, participants who had a winning bid at the close will have the first opportunity to buy their SongShares at the price set during a VIP Sale. These bidders can purchase UP TO the number of shares they had as part of their winning bid. They can purchase less, but not more. After the VIP Sale window, all remaining shares will be available for the public to purchase at that same price. Eligible participants in the VIP Sale who missed their window, or who want to buy additional shares, can do so during the live public offering. When all SongShares are sold, the offering will close. Once closing funds are sent to the SongVest escrow account, a subscription agreement for the royalty share units will be sent to sign electronically. Purchasers will be paid royalties quarterly through their account from SongVest.




How Do I Pay?


No money will be accepted until the offering is qualified by the SEC. Buyers must connect their bank account or credit card to their profile to complete registration on the site, and to pay for any offerings.




When Do I Receive Royalty Payments?


Royalties are paid on a quarterly basis to the bank account connected to your SongVest profile. An investor’s first royalty payment for a SongShare will be disbursed in the quarter following the reassignment of the stream. The reassignment process takes longer for some listings than others, depending on the payment company, and it is generally completed within 1 month if not sooner. If this process takes longer than a quarter, the first distribution will include payment for all distributions that would have occurred during the waiting period. You will be able to view your total investments in the SongVest dashboard, along with your royalty payment history.




What if I Want To Sell My SongShares?


At this time, there is not a secondary trading platform.




Will The Price Fluctuate on SongShares?


The price for SongShares is set during the VIP Auction for each listing, and will be the same purchase price during any VIP Sale or Public Sale.





 

General FAQs

What are Royalties?


Royalties are payments made from one party (the licensee) to another (the licensor) for the right to the use of an asset. The asset can be virtually anything — from tangible assets like minerals and oil to intellectual property like songs, brands and patents. Royalties are usually paid as a percentage of revenues, gross or net, yielded from the use of the asset.




What am I Buying?


SongVest offers the opportunity to purchase future royalty revenue generated by music. Details about the royalty stream you are purchasing and the asset which generates it will be available in the specific listing you are viewing. Each listing will explicitly state the length of investment for the royalty stream at auction. There are many types of royalties for many different assets, so lengths of ownership vary. Please read the details on the specific listing.




How Do I Know if This is a Good Investment?


If you are looking for a solid Alternative Investment with bond-like qualities then you should look at our Music Royalty offerings. With fluctuations in the stock market and other investment vehicles, royalties are a stable addition to any portfolio. Each royalty asset listing will provide at least three years of historical financial data. Historical earnings are not a guarantee or predictor of future earnings.
All investments involve risk of loss. You should not construe any included content, information, or other material as investment, financial, legal, tax, or other advice. RoyaltyTraders, LLC dba SongVest is not a financial services company and that any financial assessments provided are informal in nature and for informational purposes only. Site visitors should consult with their own qualified financial and/or tax professionals.




Can I License an Asset if I Buy A Royalty Stream?


The answer to this question depends on the purchase. An investor who owns only the rights to the royalty revenue generated by an asset and does not own the asset itself, nor owns the rights to license the asset, will not be able to license the asset for further use. SongShares will only sell the royalty streams, and not ownership of the asset. However, full ownership of an asset will occasionally be posted for a regular auction, in which case an investor may license the asset as desired.




How Do I Verify the Legitimacy and Legality of the Transaction?


SongVest conducts an extensive background check on each listing. We verify each asset with both its current owner and the organization responsible for collecting and disbursing the royalties it generates. For further information, please refer to our Terms of Use.




Why Does SongVest Need So Much Information to Register?


Because SongVest is conducting business subject to SEC regulations, and paying out royalties to registered users, we must collect date of birth and social security numbers during registration for each user. All payments are processed through an escrow account at North Capital.




Is This the Same as a Cryptocurrency or NFT?


SongShares are a fractionalized share of a royalty stream. SongVest does not accept cryptocurrency for payment at this time. The royalty share units are not NFTs but each transaction is recorded on the blockchain.





Regular Auctions

What are SongShares?


SongShares are fractional shares of royalty streams, and an exciting new way for anyone to buy a stake in the royalties of songs they love and share in the income. The company is the first to utilize Regulation A+ of the U.S. Securities and Exchange Commission in order to sell music royalties in SongShares which are “royalty share units.” In each offering, SongVest experts work with a seller to evaluate their catalog, determine the limited number of royalty share units to be sold, and create a listing.




What is a VIP Auction?


For each offering, SongVest holds a non-binding VIP ("Verify Interest of Participation") Auction with potential investors to price the interests in the offering of royalty share units. It is also referred to as a "Test The Waters" auction under Tier 2 of Regulation A of the Securities Act and the offering circular. The unique bidding process is how potential investors collectively set the final price per unit for an offering. Registered fans can start bids at a minimum of $20 per royalty share unit with no commitment to buy. Bidders can reserve SongShares with an option to purchase them during the official VIP Sale held after SEC qualification of the offering. During the auction, participants will bid on SongShares, until all have been reserved, and the price will increase by $1. You will need to watch your bids to confirm your priority and that you do not get outbid before the auction ends! Typically the auction will run from 9amPT/12pmET and end the next day at 6pm PT/9pm ET. This may change occassionallly, the detailed auction listing will always have the most up-to-date information.




How Does Bidding Work?


Watch a video explanation During the VIP Auction period, participants can make non-binding bids on a fractional share of the royalty stream. The number of royalty share units available will vary for each auction. Once all units have sold out at a certain price, it will automatically increase by $1 and allow for more bids on the total number of SongShares. This will repeat with price increasing until time runs out and more bids are made. Bidders can place either HARD bids or PROXY bids. HARD bids are immediate bids at the current price for a specific number of units. A PROXY bid is when you set a maximum price and number of units you would purchase and the system will automatically bid for you if the price increases. SongVest’s auction platform shows bidders the current price and bid status, and then will notify them if they are outbid. When the VIP Auction is over, the price will be set at the highest amount achieved when all were SOLD OUT. If only half of the units were sold at $20, then the final set price would be $19. After the auction and SEC qualification, all participants with successful bids of SongShares will have the option to purchase the units before the general public offering!




What Happens at the End of the VIP Auction?


SongVest uses the Five Minute Rule for auctions, whereby if a bid is placed in the final five minutes of an auction the listing will stay open for an additional five minutes. There is no limit to the number of times an auction can be extended. Soso we recommend that bidders check back often as an auction nears closing time. When the auction has officially come to a close, the listing will indicate “Auction is Closed”. SongVest makes every effort to ensure system availability. However, we reserve the right to (in rare cases) close an auction prior to, or extend it beyond, the posted closing time. This may be done at our discretion and without warning. SongVest is not responsible for incomplete, failed, garbled, scrambled, delayed or misdirected computer transmissions due to technical computer hardware or software failures or other errors of any kind. If you have a successful bid at the end of the VIP Auction, you will have the option to purchase those SongShares during the VIP Sale before the general public, and after it is qualified by the SEC.




What Happens if I Win a VIP Auction?


If you have a successful bid at the end of the VIP Auction, you will have the option to purchase those SongShares during the VIP Sale before the general public, and after the offering qualified by the SEC. You may purchase up to as many royalty units as you reserved during the Auction. For example, if you reserved 50 SongShares, you can purchase 1, 2, 10, or any quantity up to 50 units.




What is a VIP Sale or Public Sale?


After a VIP Auction is complete, participants who had a winning bid at the close will have the first opportunity to buy their SongShares at the price set during a VIP Sale. These bidders can purchase UP TO the number of shares they had as part of their winning bid. They can purchase less, but not more. After the VIP Sale window, all remaining shares will be available for the public to purchase at that same price. Eligible participants in the VIP Sale who missed their window, or who want to buy additional shares, can do so during the live public offering. When all SongShares are sold, the offering will close. Once closing funds are sent to the SongVest escrow account, a subscription agreement for the royalty share units will be sent to sign electronically. Purchasers will be paid royalties quarterly through their account from SongVest.




How Do I Pay?


No money will be accepted until the offering is qualified by the SEC. Buyers must connect their bank account or credit card to their profile to complete registration on the site, and to pay for any offerings.




When Do I Receive Royalty Payments?


Royalties are paid on a quarterly basis to the bank account connected to your SongVest profile. An investor’s first royalty payment for a SongShare will be disbursed in the quarter following the reassignment of the stream. The reassignment process takes longer for some listings than others, depending on the payment company, and it is generally completed within 1 month if not sooner. If this process takes longer than a quarter, the first distribution will include payment for all distributions that would have occurred during the waiting period. You will be able to view your total investments in the SongVest dashboard, along with your royalty payment history.




What if I Want To Sell My SongShares?


At this time, there is not a secondary trading platform.




Will The Price Fluctuate on SongShares?


The price for SongShares is set during the VIP Auction for each listing, and will be the same purchase price during any VIP Sale or Public Sale.





Seller FAQs

What are Royalties?


Royalties are payments made from one party (the licensee) to another (the licensor) for the right to the use of an asset. The asset can be virtually anything — from tangible assets like minerals and oil to intellectual property like songs, brands and patents. Royalties are usually paid as a percentage of revenues, gross or net, yielded from the use of the asset.




What am I Buying?


SongVest offers the opportunity to purchase future royalty revenue generated by music. Details about the royalty stream you are purchasing and the asset which generates it will be available in the specific listing you are viewing. Each listing will explicitly state the length of investment for the royalty stream at auction. There are many types of royalties for many different assets, so lengths of ownership vary. Please read the details on the specific listing.




How Do I Know if This is a Good Investment?


If you are looking for a solid Alternative Investment with bond-like qualities then you should look at our Music Royalty offerings. With fluctuations in the stock market and other investment vehicles, royalties are a stable addition to any portfolio. Each royalty asset listing will provide at least three years of historical financial data. Historical earnings are not a guarantee or predictor of future earnings.
All investments involve risk of loss. You should not construe any included content, information, or other material as investment, financial, legal, tax, or other advice. RoyaltyTraders, LLC dba SongVest is not a financial services company and that any financial assessments provided are informal in nature and for informational purposes only. Site visitors should consult with their own qualified financial and/or tax professionals.




Can I License an Asset if I Buy A Royalty Stream?


The answer to this question depends on the purchase. An investor who owns only the rights to the royalty revenue generated by an asset and does not own the asset itself, nor owns the rights to license the asset, will not be able to license the asset for further use. SongShares will only sell the royalty streams, and not ownership of the asset. However, full ownership of an asset will occasionally be posted for a regular auction, in which case an investor may license the asset as desired.




How Do I Verify the Legitimacy and Legality of the Transaction?


SongVest conducts an extensive background check on each listing. We verify each asset with both its current owner and the organization responsible for collecting and disbursing the royalties it generates. For further information, please refer to our Terms of Use.




Why Does SongVest Need So Much Information to Register?


Because SongVest is conducting business subject to SEC regulations, and paying out royalties to registered users, we must collect date of birth and social security numbers during registration for each user. All payments are processed through an escrow account at North Capital.




Is This the Same as a Cryptocurrency or NFT?


SongShares are a fractionalized share of a royalty stream. SongVest does not accept cryptocurrency for payment at this time. The royalty share units are not NFTs but each transaction is recorded on the blockchain.