PayBase will offer a Repurchase Agreement to the general public for 30 days, which will establish a contractual arrangement between PayBase™ and any Paycoin™ holder (Seller), whereby the Seller agrees to sell Paycoin™ to PayBase™ at $20.00 USD per Paycoin™.
"repurchase agreement" seems to be a real financial tool or instrument or transaction, whatever you want to call it. Not just smart wording on Homero's part. Someone in this field care to decipher it?
http://www.eagletraders.com/advice/securities/repurchase_agreements.phpA "repurchase agreement" does not have a definite legal meaning in the U.S. It could mean just about anything, will need to see what GAW's (Paybase??) lawyers put into the actual agreement that they offer on feb 1.
However, what remains troubling is the wording: ""whereby the Sellers agrees to sell Paycoin to Paybase". That sounds like a unilateral OPTION contract where the "seller" (read: dupe, syn. idiot with a pen) gives to Paybase an OPTION (e.g., a call option) to repurchase the Paycoin at a strike price of $20. So far, I have not seen anything that would suggest the opposite side of that OPTION; e.g., nothing saying that Paybase MUST repurchase each Paycoin at $20 per coin (e.g. a "put" option). Without the "put" side of the contract, the whole thing is silly if not misleading.
Don't believe me? Okay, here you go: enter into a contract with me. I will offer as many "repurchase agreement" contracts for as many XPY as you want, that contractually obligate you, the Seller, to sell each Paycoin to me, the Buyer, at $20 per coin upon demand, excercisable in monthly installments of not less than $100,000. The contracts will last for a minimum initial term of 5 years. You will put your coins into escrow during that term with a third party escrow. Have 16 million XPY? Sure, I will take a contract for all 16 million XPY right now!!!
See the problem? I can just hold these contracts forever, and if/when the price goes above $20 I will execute the buy (in small increments to avoid flooding the market when I resell for a profit). If it doesn't rise, I never have to execute. Its a guaranteed profit (or at worst, no loss) to me, and a guaranteed loss to the "Seller" (or at best nothing).
Now, maybe Josh's repurchase program will not be as it was described in the above referenced post, but I highly suspect that the words he chose were carefully chosen by his lawyers.
We will see.
