REX Royalty Comparator
The new, unique and vitally useful analytical tool for those considering using royalties in company financings. Is now available at rexcomparator.com
We developed the website calculator so users could compare the impact of using different royalty rate and other terms for companies and projects using the same or different revenue projections.
Never before have revenue sharing royalties been able to be comparatively studied, in both tabular and graphic form. This ability will allow users of the tool to better understand, negotiate and construct royalties which better meet the needs of both Issuers and Investors.
The REX Royalty Comparator is an exciting new feature of the website www.REXRoyalties.com and is currently available without charge.
The website has been developed to allow investors, royalty issuers and their advisors to compare values between royalties having different terms or a royalty and an equity financing for the same amount of money and using the same projected revenue and other data.
The REX Royalty Comparator adjusts the user supplied Projected Revenues to reflect the royalty payments made annually, before calculating the Pre-Tax and Net After Tax amounts, using the profit margin percentages supplied by the user.
The REX Comparator uses the Compound Annual Growth Rate (CAGR) of revenues and the same time periods for the models being compared. Users may make adjustments between the A and B entries of; the amount of funding, royalty rates during different periods and profit margins.
All of the data used is supplied by users, including the user comparable Price/Earnings Ratio and Projected Revenues. British Far East Holdings Ltd. has no responsibility for either the data used or any of the calculations.
The REX Royalty Comparator was created to allow users to better understand the impact, on both issuers and owners, of differences in the terms of a royalty agreement.
Depending on the royalty issuer's situation and focus the level of royalty can be constant or vary in different periods, perhaps as a result of the magnitude of cumulative royalty payment levels. The investor may prefer a faster payout in the early years, and as a trade-off be willing to accept a smaller return over the full term of the royalty. The calculator shows the annual effect of differences in the A and B royalty terms, using the same projected revenue levels, estimated profit margins and possibly appropriate Price/Earnings Ratio. The REX Comparator is the only analytical tool, which provides users with such useful perspective.
Business ValueThe Business Value is a result of multiplying the company's annual Net After-Tax (NAT) earnings, by the Price / Earnings Ratio, selected by the website user, to be representative of publicly traded stocks of companies having similar industrial focus and characteristics. The resulting Business Value is totally dependent on the Price / Earnings Ratio selected and the achievement of the Projected Revenues and ability to attain the predicted Net After-tax percentage as projected. The user of the REX Royalty Comparator is responsible for the data and projections entered. It should be noted that a company can have a Business Value even when not producing profit. However, the Comparator is unable to make a Business Value calculation unless there is a NAT amount. Also, the Business Value calculation is only focused on the NAT multiplied by the P/E and does not consider public or privates debt for which the company may be liable.
The REX Royalty Comparator analytical tool is intended to allow those considering or negotiating a royalty-based transaction to compare the effect of the projected data, if it is achieved, and the terms of the transaction.
The REX Royalty Comparator allows users to compare the annual results of royalties using different terms for the same royalty issuer, using the same revenue projections. This unique and proprietary program will be of great value to those considering and negotiating the terms of a royalty.
Believing that royalties are a fair and reasonable means of an investor participating in the progress of a business, a fatwa declaring the process to be Sharia compliant was sought and obtained. The fatwa permits a potentially large body of investors to buy royalties, who otherwise are not able to participate in a range of company financing opportunities.
Please review both the Samples and the FAQ sections for a better understanding of our service and send me additional questions and comments. We will not publish these questions or comments without your permission to do so.
We are available for consulting should such services be desired.
Arthur Lipper, Chairman
British Far East Holdings Ltd.
British Far East Holdings Ltd.