A new filing has shed light on Kodak’s licensing agreement with WENN Digital, the company that is developing KodakCoin and overseeing the cryptocurrency’s initial coin offering (ICO).
According to public documents dated March 15 and filed with the US Securities and Exchange Commission (SEC), WENN Digital paid Eastman Kodak a non-refundable $750,000 licensing fee for the rights to use Kodak branding on its digital rights management (DRM) platform, which will be secured by a blockchain feature a native cryptocurrency.
Kodak also received 50,000 shares of WENN common stock, a package the company said was worth approximately $1.25 million.
Moreover, WENN Digital will pay Kodak undisclosed royalties based on the results of the KodakCoin ICO, which was originally scheduled to begin in January but was delayed at the last minute amidst a widespread cryptocurrency market decline — and accusations that the KodakCoin tokens will be “worthless.”
However, WENN began distributing a “light paper” to prospective accredited investors earlier this month, an indication that the ICO had not been called off and is finally proceeding as planned.
In addition to its licensing fee, the filing states that Kodak will receive 3 million KodakCoins at the conclusion of the token sale as an advance payment against its royalties, with the assessed value of the tokens not exceeding $3 million. If WENN decides to issue more than 100 million tokens, Kodak will receive three percent of all tokens created above that mark.
Notably, however, WENN admits in the light paper that it is not sure whether the KodakCoin tokens fall under US federal securities regulations. The tokens will be issued using a simple agreement for future tokens (SAFT), an ICO distribution structure that the SEC is scrutinizing as a part of its broad ICO probe.
WENN notes that if the tokens are determined to be securities following consultation with SEC officials, investors will face “significant restrictions” if they attempt to sell or transfer their tokens. It is unclear if this warning will dampen enthusiasm among investors.
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