SPORTFOLI

O
…
A STUDENT-ATHLETE INVESTMENT PLATFORM

2020

CREATED, DESIGNED, AND EDITED BY GAVIN

CLARKE
 TABLE OF CONTENTS

PREAMBLE...................................................................................................................................v
DEFINITIONS..............................................................................................................................vi
ARTICLE 1 INTRODUCTION..................................................................................................2
ARTICLE 2 FISCAL CALENDAR............................................................................................4
Section 1. Quarters:......................................................................................................................4
Section 2. Dividend Payouts:.......................................................................................................4
Section 3. Accrued Year:.............................................................................................................4
Section 4. Final Year Player Distinction:.....................................................................................4
Section 5. Final Year Player Trading Dead Period:.....................................................................5
Section 6. Typical Calendar:........................................................................................................5
ARTICLE 3 INTENT TO INITIAL PUBLIC OFFERING PROCESS..................................6
Section 1. Eligibility:...................................................................................................................6
Section 2. Timing:........................................................................................................................6
Section 3. Briefings:.....................................................................................................................7
ARTICLE 4 TERMS AND EXPLANATIONS OF THE OFFERING...................................8
Section 1. Timing:........................................................................................................................8
Section 2. Shares Outstanding:....................................................................................................8
Section 3. Share Pricing:..............................................................................................................8
Section 4. Volume Limitation:.....................................................................................................9
Section 5. Share Value:................................................................................................................9
Section 6. Shareholder Payout:....................................................................................................9
Section 7. Athlete Payout:..........................................................................................................12
Section 8. Dividends:.................................................................................................................13
Section 9. Commission and Fees:..............................................................................................15
Section 10. Fractional Shares:....................................................................................................15
ARTICLE 5 TRADING.............................................................................................................16
Section 1. System Design:.........................................................................................................16
Section 2. Market Open:............................................................................................................16
Section 3. Order Type:...............................................................................................................16
Section 4. Customer Requirements:...........................................................................................17

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 Section 5. Insider Trading:.........................................................................................................17
Section 6. Public Disclosure Policy for Sports Writers and Journalists:...................................18
Section 7. Public Advertising Policy for Athletes and Athlete Affiliates:.................................18
ARTICLE 6 NFL SALARY.......................................................................................................20
Section 1. Gross Salary:.............................................................................................................20
Section 2. NFLPA Salary Definition:........................................................................................20
ARTICLE 7 NCAA COMPLIANCE........................................................................................22
Section 1. “Key Restrictions” and Compliance Measures:........................................................22
Section 2. “Regulations” and Compliance Measures:...............................................................23
Section 3. “Potential Guardrails” and Compliance Measures:..................................................24
ARTICLE 8 LEGALITY...........................................................................................................26
Section 1. Legal Framework from Jeff Schwartz:....................................................................26
Section 2. Current Regulations:.................................................................................................26
Section 2a. Thirteenth Amendment Analysis:...........................................................................26
Section 2b. Public Policy Analysis:...........................................................................................27
Section 2c. Securities Law Analysis:.........................................................................................29
Section 3. Possible Complimentary Regulations:......................................................................31
Section 3a. Disclosure Requirements:.......................................................................................31
Section 3b. Contractual Limits and Limits on Transfer:............................................................32
Section 3c. A Role for the Consumer Financial Protection Bureau:.........................................32
ARTICLE 9 INDUSTRY OVERVIEW.....................................................................................35
ARTICLE 10 TARGET MARKET...........................................................................................36

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 PREAMBLE

The contents of the following articles regarding the creation and potential structure
surrounding Sportfolio are merely a summary and explanation of a business model. Regulations
and plans stated in the following articles are not to be misconstrued as factually or legally
correct; nor should they be viewed complete in any sense. All formulas, processes, structures,
and regulations are subject to change at any time and under any circumstances. The following
provide an incomplete guide for the vision and future of Sportfolio. Enjoy.

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 DEFINITIONS

As used in these articles, the following terms shall have the following meanings unless
expressly stated otherwise:

“Athlete” or “Student-Athlete” means…

“Name, Image, Likeness” or “NIL” means…
“NFL” means the National Football League.
“CBA” or “NFLPA CBA” means the National Football League Collective Bargaining
Agreement for 2020-present as amended.
“User” means….
“Salary” means any compensation of money, property, investments, loans, or anything
else of value that an NFL club pays to, or is obligated to pay to, a player or Player Affiliate, or is
paid to a third party at the request of and for the benefit of a player or Player Affiliate.
“Eligible” means a student-athlete must (1) be enrolled and attending as a full-time
student each semester, (2) must earn 6 credits of coursework that apply to graduation in your
designated academic program, (3) earn a minimum of 24 hours of coursework in your academic
program during the first year in order to be eligible to compete the next year, (4) earn at least 18
hours in your major every academic year, (5) declare a major before the third year or 5th
semester of your enrollment in college, (6) have not used up the 5 years of NCAA athletic
eligibility, and (7) follow and abide by all other NCAA rules and regulations regarding academic
and athletic honesty.

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 PART 1
THE PRODUCT
…

ARTICLE 1
INTRODUCTION

The NCAA is notorious for their unfair and unjust usage of student-athletes’ name,
image, and likeness (NIL). The NCAA prides itself on their amateurism status, as well as its
ability to provide an adequate education in return for an athlete’s time and skill. But as college
sports team budgets reach astronomical heights, college coaches become the highest paid public
officials in many states, and amateur athletes are being forced to return to campus amid a
growing pandemic crisis, the question of fairness arises for the athlete’s piece in this ever-
growing cash pie. Collegiate players that do not make it to the NFL suffer their first year out of

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college; with a degree they were tutored and inadequately educated for, very few networking
connections that aren’t in athletics, and no monetary earnings for countless hours of hard work.
As a result of this, the NCAA is beginning to realize they need to change their outdated model.
The NCAA is on a path towards allowing student-athletes usage of their personal name, image,
and likeness.

As soon as fall 2021, the NCAA is going to allow student-athletes to profit off name,
image, and likeness with third party companies. Sportfolio sees a first-to-market opportunity
within the NIL market. Sportfolio is a student-athlete investment platform designed so investors
can purchase shares of an athlete in hopes that they can receive a percentage of that athlete’s first
year NFL contract. Share prices rise and fall as a correlation of the supply and demand for that
athlete. The earlier an investor can buy into an athlete, the greater the possible profits can be.
Investors can sell their share when the price raises, or they can wait to see if their athlete gets
drafted into the NFL to receive a percentage of the first year NFL contract. The longer an
investor owns stock, the more quarterly dividend payments they earn. 100% of the capital
accumulated during the trading period goes right to the athlete, whether they get drafted to the
NFL or not. But if the athlete makes it to the NFL, they owe a percentage of their 1st year NFL
contract back to their investors. Sportfolio gives a value proposition to the fantasy sports market.
No longer are fans outside of the sphere of influence for their favorite athletes. Sportfolio users
can feel good knowing their investments either provide personal profit or go towards the student-
athletes who so rightfully deserve proportionate earnings. The consumer market is there: more
than 41 million individuals in North America participate in fantasy sports each year, with 47% of
those participating in leagues with fees or memberships. Sportfolio can be a first-to-market
company providing financial benefit to student-athletes and giving value added to consumers.

This is the future Sportfolio envisions. Join us in creating it.

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 ARTICLE 2
FISCAL CALENDAR

Section 1. Quarters: The following date spreads represent the annual quarters. All quarters
begin at 12:00 AM EST on the first date and are terminated at 11:59 PM EST of the last date:
Quarter 1 (“Q1”): July 1 – September 30
Quarter 2 (“Q2”): October 1 – December 31
Quarter 3 (“Q3”): January 1 – March 31
Quarter 4 (“Q4”): April 1 – June 30

Section 2. Dividend Payouts: Quarterly dividends will be paid out on the final day of Q1, Q2,
Q3, and Q4 and will process in the user’s account within five (5) business days.

Section 3. Accrued Year: Individual athletes are categorized by accrued years on a collegiate
football team. Athletes have five (5) years of collegiate athletics eligibility, and thus will be
categorized as Year-1 (“Y1”), Year-2 (“Y2”), Year-3 (“Y3”), Year-4 (“Y4”), or Year-5 (“Y5”)
athletes respectfully. Accrued Years change by one on the first day of Q1 in the new fiscal year
(July 1), so long as the athlete is using one of his eligible years for that Accrued Year. If an
athlete is not using a year of NCAA regulated eligibility, their Accrued Year does not change.

Section 4. Final Year Player Distinction: An individual changes designation from a Y1, Y2,
Y3, Y4, or Y5 player to a Final Year Player (FYP) when they either: (a) with remaining years of
collegiate eligibility, declare for the National Football League Draft by the designated draft
declaration date, (b) complete or are currently completing their final collegiate athletics eligible
year, or (c) intend to graduate early or request an early exit waiver from the National Football
League and the National Collegiate Athletic Association (and approved).

Section 5. Final Year Player Trading Dead Period: The Final Year Player (“FYP”) Trading
Dead Period will take place beginning at 12:00 AM EST on the first day of Q4 (April 1). The
FYP Trading Dead Period ends on the first day of the next fiscal year (July 1) when Accrued
Years change by 1.

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Section 6. Typical Calendar: The typical fiscal calendar for a year in Sportfolio will look as
follows (subject to change based on year):
Jul 1 Start of Q1
Accrued Years change by 1
Y1’s IPO process approved to begin
FYP Trading Dead Period ends
Early Jul NFL Training Camps begin
Late Aug College Football Regular Season begins
Early Sep NFL Regular Season begins
Early Sep Shareholder Payouts
Sep 30 End of Q1
Quarterly Dividend (1/4)
Oct 1 Start of Q2
Dec 31 End of Q2
Quarterly Dividend (2/4)
Jan 1 Start of Q3
Early Jan College Football Season ends
Early Feb NFL Super Bowl
Mar 31End of Q3
Quarterly Dividend (3/4)
Apr 1 Start of Q4
FYP Trading Dead Period begins
Late Apr NFL Draft
Jun 30 End of Q4
Athlete Payouts
Quarterly Dividend (4/4)

ARTICLE 3
INTENT TO INITIAL PUBLIC OFFERING PROCESS

Section 1. Eligibility: Individuals setting up an Initial Public Offering (“IPO”) with Sportfolio
must (a) be a least 18 years old on the date of the IPO, (b) currently attending or contractually
signed to attend a four-year accredited university within the United States, (c) must not have
been persuaded or aided in their intention to IPO by university or conference officials, and (d)
have completed and passed a basic module explaining the terms, condition, and future liabilities
associated with an IPO with Sportfolio.

Section 2. Timing:
(a) An eligible individual may begin the IPO process starting on the first day of Q1
(July 1) in their first Accrued Year. When an Intent to IPO Form (“I-IPO”) is filed with the IPO
office, a thirty-day (30) Warm-Up Period begins. During the Warm-Up Period, the individual

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may void their intent to IPO at any time, with no legal obligation or penalty for failing to
continue the IPO process.
(b) During the Warm-Up Period, the individual is assigned a representative from
Sportfolio in addition selecting a third-party representative on their own accord. Both the
representative from Sportfolio and the third-party should provide legal and ethical counsel to the
individual by educating them about the future considerations of an IPO with Sportfolio.
Sportfolio and the third-party representatives must virtually or physically meet with the
individual for a minimum of three (3), thirty (30) minute briefing sessions during the Warm-Up
period 3.3.
(c) When the Warm-Up period is complete, and the individual wishes to continue the
process towards an IPO, the individual may set an IPO date by personal preference. The IPO date
must occur within one-hundred and eighty (180) days from the conclusion of the Warm-Up
period. When an IPO date is confirmed, the individual is now legally obligated to follow through
with creating an IPO with Sportfolio. After 180 days, a new I-IPO Form and Warm-Up period
must be completed.

Section 3. Briefings: Sessions with Sportfolio, a third-party representative, and the individual
must consist of legal advice, contractual explanations and simplifications, possible marketing
deal examples, and familial counseling. No signatures or legal obligations will be fulfilled at the
briefings. All briefings will be held in compliance with the NCAA’s future possible regulations
for third party marketers and financial advisors.

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 ARTICLE 4
TERMS AND EXPLANATIONS OF THE OFFERING

Section 1. Timing: Share trading begins at 12:00 PM EST on the date of the IPO and continues
until the player changes designation into a Final Year Player. Trading ceases on the first day of
Q3 in the athlete’s final year (April 1).

Section 2. Shares Outstanding:

(a) The total number of initial shares outstanding is determined by the individual’s
Accrued Year in which the IPO occurs. The number of shares in the chart below represents the
total public shares outstanding by the Accrued Year of the IPO, in addition to the possible pre-
IPO shares that could be purchased by Sportfolio as mentioned in 4.2(b).

IPO Year Public Shares Possible Pre-IPO Shares

Year 1 3000 0
Year 2 3000 0
Year 3 2500 500
Year 4 2500 500
Year 5 2000 1000

(b) Sportfolio reserves the right, if it so chooses, to buy Pre-IPO stock in Y3, Y4, or
Y5 athletes up to the amounts stated in the Possible pre-IPO column above. Therefore, Sportfolio
can purchase 500 shares of Y3, 500 shares of Y4, and 1000 shares of Y5 athletes respectfully.
Pre-IPO shares are priced at $10.00 per share and are redeemed at the typical future possible
value of 0.0065% per share.

Section 3. Share Pricing: Share prices are initially set at $10.00 per share and are raised and
lowered as a reflection of supply and demand within the market (see ARTICLE 5 TRADING).
However, shares cannot lower more than the initial $10.00 per share. Fractional shares of ½ and
¼ are available for initial prices of $5.00 and $2.50 respectfully are changed proportionately to
the price of a full share 4.10(a-b).

Section 4. Volume Limitation: No one individual shareholder can claim greater than thirty
percent (30%) of the total public shares of an athlete. No one individual shareholder can make
one transaction that is greater than ten percent (10%) of the total public shares of an athlete.

Section 5. Share Value: For every share purchased, the shareholder will receive the exact value
of 0.0065% of a possible future first-year rookie salary in the National Football League by the
individual the stock is invested in. Fractional shares split the share value proportionately

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(0.00325% for ½ shares and 0.001625% for ¼ shares). The percent of possible future first-year
rookie NFL salary is a percentage of Gross Salary as defined by the National Football League
Players Association. More information on Gross Salary can be found in ARTICLE 6 NFL
SALARY.

Salary Split per Share=0.000065∗Gross Salary

Ex1) Person A purchases and holds 1 share of Athlete X until the FYP Trading
Dead Period. Athlete X is drafted in the 6th round of the NFL draft and his Gross Salary is
$656,884.00. On the designated Shareholder Payout date, Person A receives 1 share
worth 0.0065% of Athlete X’s first year Gross Salary. This equates to $42.70 per share (
0.000065∗$ 656,884.00=$ 42.70).

Section 6. Shareholder Payout:

(a) Shareholders only receive the Shareholder Payout if (1) the athlete is drafted or
signed as a free agent with a National Football League club within one-hundred and eighty (180)
days of the National Football League Draft, (2) the athlete is on a 53-man regular season roster at
the start of the regular season, AND (3) the athlete is eligible for full season salary and bonuses
as determined and outlined in the National Football League Collective Bargaining Agreement.
Shareholders do NOT receive Shareholder payouts for athletes who are contracted under the
National Football League in any capacity which is not defined as a “player on roster” by the
National Football League Players Association. Official NFL practice squad players are exempt
from paying Shareholder Payouts. The Shareholder Payout is split proportionately among all
shareholders and is outlined in the Payout per Shareholder formula below. The Total Shareholder
Payout formula represents the total amount the athlete pays to shareholders.

Payout per Shareholder=Shares Held∗Salary Split per Share

Total Shareholder Payout =Total Shares Oustanding∗Salary Split per Share

Ex1) Person A purchases and holds 2 full shares and one ¼ share of Athlete X
until the FYP Trading Dead Period. Athlete X is drafted in the 6th round of the NFL draft
and his Gross Salary is $648,987.00. On the designated Shareholder Payout date, Person
A receives 2 full shares worth $42.18 each (0.000065∗$ 648,987.00=$ 42.18) and one ¼
share worth $10.55 (0.00001625∗$ 648,987.00=$ 10.55).
Ex2) Person B purchases and holds 3 full shares of Athlete Y for $10.00 each
($30.00 total) until the FYP Trading Dead Period. Athlete Y is not drafted in the NFL
draft and not signed as a free agent to any NFL club. The Payout for Person B will be
$0.00 (3 Shares∗$ 0.00=$ 0.00). (excluding dividend payments)
Ex3) Person C purchases and holds 1 share of Athlete Z until the FYP Trading
Dead Period. The share was purchased for a price of $45.28. Athlete Z is drafted in the 7th
round of the NFL draft and receives a $628,872.00 Gross Salary. The Payout for Person

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 C will be $40.87 (0.000065∗$ 628,872.00=$ 40.87). Person C has a net loss of $4.41
ignoring any commission, fees, or dividends ($ 45.28−$ 40.87=$ 4.41).

(b) Shareholder payouts are paid on the Tuesday of week 4 of the NFL season.
Shareholder payouts can either be paid “in full” by the athlete themselves, or paid from
Sportfolio directly with a three (3) year, nine percent (9%) flat-rate interest loan taken out by the
athlete as mentioned in 4.6(d).
(c) In full Shareholder Payouts are paid directly from the athlete to the shareholders
at the contractually obligated price and on the Shareholder Payout date. Payouts will show on the
shareholders accounts within seven (7) business days.
(d) If an athlete wishes to hold off on paying shareholders directly on the designated
shareholder payout day, Sportfolio will fund the Shareholders with the contractually obligated
amount on the date specified. However, within thirty-six (36) months from the designated
Shareholder Payout date, the athlete must pay back the principle Shareholder Payout amount to
Sportfolio plus a flat-rate 9% interest. If the athlete still cannot pay the Shareholder Payout
principle amount plus interest after 36 months, legal action may occur..
(e) Additionally, shareholders receive quarterly dividend payouts which may aid in
the profitability of an athlete’s stock. Shareholder dividend details and specifics are outlined in
4.8. An individual shareholder’s net profit (ignoring commission and fees) is determined by the
following formula:

Shareholder Profit=Salary Split per Share− Avg Price per Share+Total Dividends

Ex1) Person A purchases and holds 2 full shares and one ¼ share of Athlete X
until the FYP Trading Dead Period. The full shares were priced at $16.56 and the ¼ share
was priced at $4.14. Athlete X is drafted in the 6th round of the NFL draft and his Gross
Salary is $648,987.00. On the designated Shareholder Payout date, Person A receives 2
full shares worth $42.18 each (0.000065∗$ 648,987.00=$ 42.18) and one ¼ share worth
$10.55 (0.00001625∗$ 648,987.00=$ 10.55). Person A’s profit is $54.00 (
( $ 42.18∗2+$ 10.55 )−( $ 16.56∗2+ $ 4.14 )=$ 57.65).
Ex2) Person B purchases and holds 3 full shares of Athlete Y for $10.00 each
($30.00 total) until the FYP Trading Dead Period. Athlete Y is not drafted in the NFL
draft and not signed as a free agent to any NFL club. The Payout for Person B will be
$0.00 (3 Shares∗$ 0.00=$ 0.00). (pending dividend payments) The profit for Person B is
$0.00
Ex3) Person C purchases and holds 1 share of Athlete Z until the FYP Trading
Dead Period. The share was purchased for a price of $45.28. Athlete Z is drafted in the 7th
round of the NFL draft and receives a $628,872.00 Gross Salary. The Payout for Person
C will be $39.20 (0.000065∗$ 628,872.00=$ 40.87). The profit for Person C will be -
$4.41 (a loss of $6.08) ($ 40.87−$ 45.28=−$ 4.41 ).

Section 7. Athlete Payout:

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 (a) The Athlete will receive a payout value equivalent to the average price per share
multiplied by the total number of shares sold. Athletes receive the payout under all
circumstances barring a breached contract with Sportfolio 4.7(b). The Athlete Payout date is the
final day of Q4 of their final fiscal year (June 30). Athlete payouts are determined by the formula
written below.

Athlete Payout= Average Price per Share∗Shares Outstandin g

Ex1) 3000 shares of Athlete X are sold at an average market price of $26.388.
Athlete X receives an Athlete Payout of $80,664.00 ($ 26.388∗3000=$ 79,164 .00).

(b) A breach of contract includes but is not limited to: (1) failing to graduate from
college, (2) failing to comply with NCAA regulations surrounding Sportfolio or other third party
companies, (3) committing a federal crime, and (4) failing to partake in one or more of the other
terms and conditions of the IPO contract.
(c) Marketing bonuses are the total allotment of monetary payment by Sportfolio for
an athlete’s name, image, and likeness over the course of the athlete doing business with
Sportfolio. Marketing bonuses presented by Sportfolio will be in accordance with all current and
future NCAA’s “fair market value” regulations. Marketing Bonuses are considered part of the
Total Athlete Payout yet are not paid on the “Athlete Payout Date” as stated in 7.4(a). Marketing
Bonuses are paid at the time of business yet are still considered part of the Total Athlete Payout
received by the individual. The formula for Total Athlete Payout is as follows:

Total Athlete Payout =Athlete Payout + Marketing Bonus

Ex1) Athlete X receives an Athlete Payout of $79,164.00 from capital gains.

Athlete X receives a $1,500.00 marketing bonus for social media posts advertising for
Sportfolio. Athlete X receives a Total Athlete Payout of $80,664.00 (
$ 79,164+ $ 1,500=$ 80,664.00).

(d) The total Shareholder Payout subtracted from the Total Athlete Payout equals the
Athlete’s Net Payment (either positive or negative). A Shareholder Payout that is greater than the
Total Athlete Payout will equate to a net loss in salary for the client. A Total Athlete Payout that
is greater than the Shareholder Payout will result in a net profit in salary for the client. There are
$0.00 in Shareholder Payouts if the athlete does not fit the qualifications outlined in 4.6(a).

Athlete Net Amount=Total Athlete Payout−Total Shareholder Payout

Section 8. Dividends:
(a) Shareholders are intitled to quarterly dividends earned as a percentage of their
stock held in an athlete. Quarterly Dividend rate percentages are determined by the total number
of quarters a shareholder has held stock for. Dividend percentage rates are calculated against the
sum of the initial investment and not the variable stock price. The maximum amount of quarters

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a shareholder can hold their stock is 20 (four quarterly dividends for all five years of collegiate
eligibility). A shareholder who holds a stock for all 20 possible dividend-receiving quarters will
receive a 30% return on the initial investment from dividends alone. Dividends are not subject to
commission or fees by Sportfolio but are considered taxable income by the United States
government. Dividend rate percentages by number of quarters held are as follows; number in
parentheses is the total cumulative dividends as a percentage of the initial investment:

Q1 1.25% (1.25%) Q11 1.50% (15.50%)

Q2 1.25% (2.50%) Q12 1.50% (17.00%)
Q3 1.25% (3.75%) Q13 1.50% (18.50%)
Q4 1.25% (5.00%) Q14 1.50% (20.00%)
Q5 1.50% (6.50%) Q15 1.75% (21.75%)
Q6 1.50% (8.00%) Q16 1.75% (23.50%)
Q7 1.50% (9.50%) Q17 1.50% (25.00%)
Q8 1.50% (11.00%) Q18 1.50% (26.50%)
Q9 1.50% (12.50%) Q19 1.75% (28.25%)
Q10 1.50% (14.00%) Q20 1.75% (30.00%)

(b) Dividends are paid as a percentage of the value of the stock owned by the
shareholder. Quarterly dividends and total dividends can be calculated using the following two
formulas. Dividend yield percentage is determined using the above chart.

Quarterly Dividend =Dividend Rate %∗Total Stock Amount

Total Dividends=∑ of the Quarterly Dividends

Ex1) Person A purchases 1 full share of Athlete X for $10.00 and holds the
share for 12 quarters before Person A sells it. Person A will have collected $1.70 in total
dividends (17% of the initial investment), over 12 quarters (
$ 10.00∗( 1.25 % +1.25 %+1.25 % +1.25 %+1.50 % +1.50 %+1.50 % +1.50 %+1.50 % +1.50 %+ 1.50 %+1.
).

(c) Common public shareholders are eligible for dividends if they own the stock at
least five (5) trading days prior to the expected dividend date. Dividends are paid to full, half
(½), and quarter (¼) shareholders at their proportionate amount. Dividends are rounded to the
nearest whole cent. Dividends are paid out quarterly on the final day of each fiscal quarter.
(d) Dividends are paid from a designated cash pool supplied by Sportfolio, the
Athlete does NOT pay any percentage of dividends to their investors.
(e) Dividends paid from Sportfolio are considered “qualified dividends” under United
States law and will be taxed as such. To meet the criteria for the qualified dividend tax rate, the
stock must have been held for more than sixty (60) days prior to the ex-dividend date.

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Section 9. Commission and Fees: Sportfolio will take a flat rate commission percentage and a
service fee from all stock transactions. Sportfolio will never take any percentage of an athlete’s
payout unless the athlete applies for the three (3) year 9% interest loan as mentioned in 4.6(d).
Buy orders, sell orders, and Shareholder Payouts are subject to a 5% transaction commission in
addition to a flat $2.00 service fee. The formula for calculating total transaction cost is as
follows:

Total Transaction Cost =( Total Stock Cost∗1.05 ) + $ 2.00+tax

Section 10. Fractional Shares:

(a) Shares in an athlete may also be purchased as fractional shares. Fractional shares
may either be purchased as a ¼ share or as a ½ share. The Share Value of the fractional shares of
¼ and ½ are 0.001625% and 0.00325% respectfully. Fractional shares are still subject
commission and fees.
(b) One free ¼ fractional share is given to new traders when they create a verified
account with Sportfolio. Additionally, up to three (3) total ¼ fractional shares can be given for
every new user a customer recruits to Sportfolio using a referral link; maximum of three (3) ¼
fractional shares can be redeemed by the original Sportfolio user. The free ¼ fractional share is
purchased by Sportfolio at the IPO price of $2.50 ($10 full share price) and is exempt from
commission and fees on the buying ransaction, but not the selling transaction.
ARTICLE 5
TRADING

Section 1. System Design: The Sportfolio stock exchange is a direct reflection of the United
States patent 4,674,044A (expired). This system is a data processing-based apparatus that makes
an automated trading market for one or more securities. The system retrieves the best obtaining
bid and asked prices from a remote data base. Data characterizing each security’s buy/sell order
requested by a customer is supplied to the system. The order is qualified for execution by
comparing its specifics against predetermined stored parameters. The stored parameters include
the operative bid and asked prices, the amount of stock available for customer purchase or sale,
and maximum single order size. Once qualified, the order is executed, and the appropriate
parameters are updated. The system provides inventory control and profit accounting for the
market maker. Finally, the system reports the executed trade details to the customer, and to stock
price reporting systems. Upon a change in the quoted price for a security, the system updates all
relevant qualification parameters. Quoted security prices will never lower than the predetermined
$10.00 IPO.1

Section 2. Market Open: The Sportfolio Exchange is available for trading 24 hours a day for
every day of the calendar year barring the individual is in a FYP Trading Dead period. Sportfolio
reserves the right to run scheduled maintenance outages that will limit or substantially halt
trading services. Customer compensation for unplanned maintenance or outages will be dealt
with on a case by case basis.
1
https://patents.google.com/patent/US4674044A/en.

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Section 3. Order Type: Sportfolio only allows market orders, buy limit orders, and sell limit
orders to be made for athlete stocks. Sportfolio users will be notified of the risks associated with
market orders on low volume stocks if they so choose to do a market order. None of the
following order types are applicable for usage on Sportfolio: buy stops, sell stops, stop-limit
order, stop-limit orders, all or none, immediate or cancel, fill or kill, good ‘til cancelled, day, or
take profits.

Section 4. Customer Requirements:

(a) Individual customers wishing to purchase any stock using Sportfolio must (1) be
18 years or older, (2) have a valid Social Security Number (not a Taxpayer Identification
Number), (3) have a legal U.S. residential address within the 50 states or Puerto Rico (possible
exceptions for active U.S. military personnel stationed abroad), (4) be a U.S. citizen, U.S.
permanent resident, or have a valid U.S. visa, (5) not be affiliated in any capacity with the
National Football League or any of its 32 clubs, and (6) not be affiliated in any capacity with the
National Collegiate Athletic Association or any of its Division I, Division II, or Division III
teams.
(b) Individual customers wishing to purchase stock in a particular Sportfolio athlete
must select the Relational Trading checkbox when completing a stock transaction if considered
an “Insider” under 5.5.

Section 5. Insider Trading: Sportfolio defines insider trading differently that the Securities and
Exchange Commission. Athletes are not held to the same fiduciary duty as corporations and thus
are not held to the same public release information regulations. Basic insider trading regulations
exist for Sportfolio and limit selling of stock by the following persons in relation to the athlete:
friends, business associates, family members, school officers, agents, and other "tippees" of such
individuals. The aforementioned individuals may buy stock in a client at any time but are barred
from selling their stock in any manner. Insider investors must select the “I am an Insider”
checkbox when completing a transaction for an athlete’s stock in which they are an insider for.
Individuals that are defined as an Insider by the statements above and do not check the “I am an
Insider” checkbox are subject to insider trading violations. Individuals subject to insider trading
fraud with Sportfolio will be subject to some if not all of the following: (a) return of all monetary
gain resulting from the insider trading to Sportfolio and/or the athlete proportionately, (b) a fine
equivalent to 51% of the amount calculated in 5.5(a) paid directly to Sportoflio, (c) a loss of any
future first year salary ownership as a result of the insider trading violation, or (d) a lifetime ban
from using Sportfolio’s services.

Section 6. Public Disclosure Policy for Sports Writers and Journalists:

(a) Sports writers and journalists are not barred from purchasing or selling stock with
Sportfolio, but they must agree to the terms and conditions of Sportfolio’s Disclosure and Public
Information Policy if they wish to trade with Sportfolio. The elements of the Disclosure and
Public Information Policy for Sports Writers and Journalists are as follows:

12
 (i) They must not buy or sell a stock during the period of seven (7) market days
before to seven (7) market days after the publication of an opinion or prediction piece on
that same stock.
(ii) They must not disclose abhorrently incorrect or hyperbolic statements
regarding an athlete they have stake in.
(iii) They must notify our compliance department of their sportswriter or
journalist status while making an account with Sportfolio. This can be done by checking
the “I am a sportswriter or journalist” checkbox when creating an account.

(b) Sportswriters and journalists who do not agree or apply to the statements above
will may be subject to some or all of the following penalties: (a) return all monetary gain
resulting from the infringement to Sportfolio and/or the athlete proportionately, (b) lose any
future first year salary ownership as a result of the trading violation, (c) receive one strike
towards a banned Sportfolio account, or (d) an immediate lifetime ban from using Sportfolio’s
services.

Section 7. Public Advertising Policy for Athletes and Athlete Affiliates: Athletes and athlete
affiliates are subject to strict disclosure and advertisement regulations under the SEC. A notice
must comply with Section 4(a)(6) of the Securities Act2. The notice is allowed only if it directs
investors to the intermediary's (Sportfolio) platform and includes no more than the following
information:
(1) A statement that Sportfolio is conducting an offering pursuant to section 4(a)
(6) of the Securities Act3, the name of the intermediary through which the offering is
being conducted and a link directing the potential investor to the intermediary's platform.
(2) The terms of the offering (i.e. the amount of securities offered, the nature of
the securities, the price of the securities and the closing date of the offering period4).
(3) Factual information about the legal identity and business location, the address,
phone number and Web site, the email address of a representative and a brief description
of the business5.

2
15 U.S.C. 77d(a)(6)
3
i.d.
4
17 C.F.R. § 227.204
5
i.d.

13
 ARTICLE 6
NFL SALARY

Section 1. Gross Salary: Sportfolio uses the term “Gross Salary” to define the amount of salary
the shareholder percentages are based and calculated upon. Sportfolio’s term “Gross Salary” is
equivalent in all legal and contractual terms to the National Football League Players Associate
Collective Bargaining Agreement’s “Paragraph 5 Salary” added to NFL’s “Signing Bonus
Proration”. The NFLPA’s definitions of the following formula terms can be found in 6.2. The
formula for Gross Salary is as follows:

SportfolioGross Salary=Paragraph Five Salary+ Signing Bonus Proration

Section 2. NFLPA Salary Definition: The National Football League Players Association
Collective Bargaining Agreement explains the terms “Paragraph Five Salary”, “Signing Bonus
Proration” and “Year-One Salary” in the following excerpt:

“…the highest amount of earnable compensation for which such player and Club have
contracted in the first year of his Rookie Contract regardless of whether any or all amounts are
earned or considered “likely to be earned” as set forth in Article 13, excluding only (A)
minimum offseason workout per diem, and (B) compensation for community relations/sponsor
appearances (subject to the maximum amounts permitted in Section 3(b)(iv) below).
(ii) “Year-One Rookie Salary” for an Undrafted Rookie means the highest amount of earnable
compensation for which such player and Club have contracted in the first year of his Rookie
Contract that exceeds the then-applicable Minimum Active/Inactive Salary for players with zero
credited seasons regardless of whether any or all amounts are earned or considered “likely to
be earned” as set forth in Article 13, excluding only (A) minimum offseason workout per diem,
and (B) compensation for community relations/sponsor appearances (subject to the maximum
amounts permitted in Section 3(b)(iv) below).
(iii) For the purpose of calculating Year-One Rookie Salary, signing bonus and amounts treated
as signing bonus will be prorated on a straight-line basis pursuant to Section 3(g) below. By
way of example, a Drafted Rookie who has a $1,000,000 Paragraph 5 Salary, $250,000 in
signing bonus proration and a $250,000 incentive for 95% offensive playtime in his first season
would have Year-One Rookie Salary in that League Year of $1,500,000 regardless of whether he
earns any or all of the above amounts in his first season or whether any or all of the above
amounts are considered “likely to be earned.””6
6
National Football League Players Association Collective Bargaining Agreement. (2020). Retrieved July 8, 2020,
from https://nflpaweb.blob.core.windows.net/media/Default/NFLPA/CBA2020/NFL-

14
Exact contractual terms and conditions are required to be shared with Sportfolio following the
signing of an NFL contract. No endorsement or marketing earnings reports for NFL players need
to be shared with Sportfolio.

Section 3. Taxes: Sportfolio takes the percentage representing the Shareholder Payout from pre-
taxed earnings.

ARTICLE 7
NCAA COMPLIANCE

The following sections list quoted regulatory measures the NCAA could taking towards
future name, image, and likeness legislation. The NCAA statements in quotes are by no means
final or complete but can be used as guidelines towards framing Sportfolio’s possible future
compliance measures. “Key Restrictions” represent almost certain regulations the NCAA will
uphold and that Sportfolio needs to be prepared for. These will be further drafted but are almost
certain to be included in any final legislation. “Regulations” provide a good example of what
future rules could possibly be. “Potential Guardrails” showcase possible framing points that
could become legislation in the future but are not currently on the table for lawmaking.7

Section 1. “Key Restrictions” and Compliance Measures:

(a) “Athletes or third parties cannot use any intellectual property (logos, trademarks)
from school or conferences in endorsements.”
Compliance: Sportfolio will only use school and conference names in a
text-based, non-trademarkable manner. Any need for trademarked
materials will go through the correct approval process and be paid for in
advance.
NFLPA_CBA_March_5_2020.pdf
7
Sallee &, B. (2020, April 29). NCAA takes big step toward allowing name, image and likeness compensation for
athletes. Retrieved July 08, 2020, from https://www.cbssports.com/college-football/news/ncaa-takes-big-step-
toward-allowing-name-image-and-likeness-compensation-for-athletes/

15
 (b) “Schools or conferences cannot make endorsement payments.”
Compliance: 5.4(a)(6) Conferences and Schools are barred from having
any staff or representative purchase athlete stock using Sportfolio.
(c) “Schools or conferences cannot facilitate athletes’ endorsements”
Compliance: To be eligible to IPO with Sportfolio, 3.1(c) athletes must
not have been persuaded or aided during the intention to IPO process by
any school or conference official.
(d) “Schools cannot use -- or allow boosters to use -- endorsements as a means of
paying for enrollment or participation in athletics.”
Compliance: Boosters paying for enrollment are prevented from doing so
with regulations provided in the article sections 3.1(a) Sportfolio athletes
be at least 18 years old at the time of the IPO; and 3.1(b) athletes must be
currently attending or already contractually obligated to attend a four year
university. This theoretically eliminates any pre-enrollment payments.

Section 2. “Regulations” and Compliance Measures:

(a) “Endorsement is a genuine payment for use of NIL , not a disguised form of pay
for play with contingencies -- compensation for participation or inducement in
recruiting to select a certain school.”
Compliance: Same answer as found in 7.1(d). Regulations mandate that
3.1(a) Sportfolio athletes be at least 18 years old at the time of the IPO,
and 3.1(b) that athletes must be currently attending or already
contractually obligated to attend a four-year university.
(b) “Endorsement is for genuine use of NIL independent of athletic participation or
performance rather than payment for participation or performance.”
Compliance: Athlete pay from Sportfolio is a free market evaluation
system. Athletes that are more suitable towards marketing promotions will
receive higher marketing bonuses; and athletes that Sportfolio users deem
most profitable will receive the largest amount of capital gains. No
payment for direct game, season or participation scenarios occur using
Sportfolio.
(c) “Athletes cannot request to be compensated for NIL in situations in which they
have no legal right to demand such compensation.”
Compliance: Sportfolio leads and directs all compensation situations. The
athlete may not request bonuses or rewards that are not warranted under
their individual contract with Sportfolio.
(d) “Regulation of third parties, such as marketing agents and financial advisors.”
Compliance: 3.3 Sportfolio marketing and financial agents will be in
direct compliance and participation with future NCAA regulations.

Section 3. “Potential Guardrails” and Compliance Measures:

(a) “Potentially attempting to determine "fair market value" for endorsements to
ensure they meet within the outlined regulations.”

16
 Compliance: 4.7(c) Sportfolio’s marketing bonuses will all be presented in
accordance with the NCAA’s fair market value of endorsement
regulations.
(b) “Potentially limiting categories of promotion to be consistent with NCAA's
membership values (no alcohol, tobacco, sports gambling).”
Compliance: Sportfolio is not associated in any manner with alcohol or
tobacco. Sportfolio is not considered illegal sports gambling under US
code.8
(c) “Potentially limiting categories of third-party endorsements (athletic shoe and
apparel companies) due to a history of encouraging or facilitating recruiting and
other rules infractions.”
Compliance: Sportfolio does not have any history of encouraging or
facilitating recruiting or other rule infractions.
(d) “Potentially making changes to acceptable pre-enrollment activities for athletes.”
Compliance: Similarly stated in 7.1(d) and 7.2(a), regulations mandate that
3.1(a) Sportfolio athletes be at least 18 years old at the time of the IPO,
and that 3.1(b) athletes must be currently attending or already
contractually obligated to attend a four-year university. Thereby
eliminated all pre-enrollment activities.
(e) “Potentially ensuring any endorsements do not interfere with the NCAA's efforts
towards diversity, inclusion or gender equality.”
Compliance: Currently, Sportfolio has only been modeled towards
collegiate football. In the future Sportfolio hopes to expand to the other
“post-college drafting” sports including men’s and woman’s basketball.

8
31 U.S. Code § 5362 1(E)(i).

17
 ARTICLE 8
LEGALITY

Section 1. Legal Framework from Jeff Schwartz: 8.2-3 represent parts the framework
provided by Law Professor Jeff Schwartz in his paper titled “The Corporation of Personhood”.
In his paper, he speaks on the current regulations and ethics surrounding human equity
investing. 8.2a-2b represent the current legal and regulatory background and how it effects the
future of human equity investments such as Sportfolio. 8.3a-3c represent Schwartz’s
recommended regulatory regime for human-equity investing. Sportfolio aims to follow most of
his recommendations outlined in the paper.9

Section 2. Current Regulations:

Section 2a. Thirteenth Amendment Analysis: The 13th amendment of the United
States constitution is the amendment that banned slavery or forced labor. When
comparing the verbiage typically used of shareholders “owning” part of the corporation
they are invested in, the issue of whether human equity investment could be in
contradiction to the 13th amendment. The 13th Amendment is made up of two sections.
According to section 1, “[n]either slavery nor involuntary servitude, except as a
punishment for crime whereof the party shall have been duly convicted, shall exist within
the United States, or any place subject to their jurisdiction.”10 The issue under section 1 is
whether human equity investing qualifies as “slavery” or “involuntary servitude” as those
terms have been interpreted. Specifically, involuntary servitude applies to “situations in
which labor is compelled by physical coercion or force of law.”11 Human-equity
investments like Sportfolio do not require “labor.” The athletes must share monetary
rewards from their labor, but they are not actually required to work themselves.
Sportfolio is compliant with the 13th amendment.

Section 2b. Public Policy Analysis: Schwartz categorizes public policy views on human
equity investments into benefits and concerns for investors, and benefits and concerns for
investees. Sportfolio is mainly interested in the concerns raised by Schwartz for each
category and will provide a solution to each concern:
(a) Asymmetric information: “The value of a human-equity investment
depends on the future prospects and plans of the investee, who has far
better knowledge of these things than the investor.”12
Solution: Sportfolio does not pay any upfront costs for its athlete
stocks and therefore does not need to undergo evaluation or pricing
9
Schwartz, J., 2015. [online] Illinois Law Review. Available at: <https://illinoislawreview.org/wp-content/ilr-
content/articles/2015/3/Schwartz.pdf> [Accessed 7 July 2020].
10
U.S. CONST. amend. XIII, § 1.
11
United States v. Kozminski, 487 U.S. 943 (1988).
12
Schwartz, J., 2015. [online] Illinois Law Review. Available at: <https://illinoislawreview.org/wp-content/ilr-
content/articles/2015/3/Schwartz.pdf> [Accessed 7 July 2020]. (1142)

18
 for its athletes to determine upfront costs. Each Sportfolio athlete
gets the same care and attentiveness during briefings and each has
the general right to “fair-market value” marketing bonuses. The
issue of asymmetric information is of no concern for Sportfolio.
(b) Moral hazard: “Once people purchase insurance that protects them from
the downside of risky behavior, they have less incentive to avoid that
behavior.”13
Solution: Sportfolio does not pay any student-athletes until they
have fulfilled the duties of their contract with Sporfolio 4.7(c).
Moral Hazard only occurs when contractually obligated
individuals are paid in advance and take risks due to their
advanced payment. The only advanced payment Sportfolio makes
to athletes is for endorsement and advertising payments (Marketing
Bonus).
(c) Enforcement: “Investors in human equity have reason to be concerned
about whether their investees are sharing all [profits] that they should.”14
Solution: NFL contracts are some of the most accessible
employment contracts that exist. All details on compensation,
bonuses, and proration will be shared with Sportfolio and then
shared with investors. The NFL keeps rookie contracts heavily
regulated and limits/regulates the amount prorated to each year.
This limits an earnings shift to avoid paying a heavier year 1
Shareholder Payout.
(d) Coercion: “Coercion occurs when peoples’ dire economic conditions lead
them to enter into bargains that they would not otherwise have
considered.”15
Solution: Sportfolio does not allow student-athletes to be pressured
into signing an IPO, nor does it take any earnings from a graduated
and contractually fulfilled athlete who does not make it to the NFL.
(e) Commodification: “For a transaction to be commodifying, there is no need
for it to be coercive, nor must there be any sign of incomplete information
or bounded rationality. The worry here is that certain transactions degrade
the thing that is purchased or sold.”16
Solution: Sportfolio limits itself to only contracting NFL player’s
“first year” salaries. As said in Jeff Schwartz’s paper, “…the
longer the equity-sharing arrangement, the more commodifying it
is.”17 Sportfolio has very short arrangements to limit the
commodification of student-athletes.

13
i.d.
14
i.d. at 1143
15
i.d. at 1153
16
i.d.
17
i.d.

19
 Section 2c. Securities Law Analysis:
(a) The Howey Test is a legal instrument created in the court case SEC v.
Howey to determine if certain transactions count as “investment contracts”,18 also known
as securities. Sportfolio will have to file with the SEC and/or FINRA if its athlete stocks
are considered securities. Understanding if Sportfolio stocks count as securities is crucial
for knowing with regulations apply to Sportfolio. If the investment applies to all four
questions of the Howey Test, the investment is a security. The Howey test is as follows:
(1) It is an investment of money.
(2) There is an expectation of profits from the investment.
(3) The investment of money is in a common enterprise.
(4) Any profit comes from the efforts of a promoter or third party.
According the four-part Howey test and to Schwartz, “the typical human-equity
investment is a security.”19

(b) Sportfolio will need to comply with securities regulations by the SEC.
There is a balance between allowing investor/investee freedom and the costs and effort
for registration. Sportfolio has two exempt offering options to avoid the time and cost of
SEC filing: Rule 506(b) of Regulation D20 and Regulation Crowdfunding21. Sportfolio has
the other option to filing and registering as a brokerage service with the SEC to sell its
own security in athletes. Sportfolio can also find, create, or lobby for another legal
exempt offering scheme. The four options are each explained below:
(i) Rule 506(b) of Regulation D: An offering under Rule 506(b) of
Regulation D is subject to the following requirements: no general solicitation or
advertising to market the securities and securities may not be sold to more than 35
non-accredited investors. If non-accredited investors are participating in the
offering, the company conducting the offering: (1) must give any non-accredited
investors disclosure documents that generally contain the same type of
information as provided in registered offerings, (2) must give any non-accredited
investors financial statement information specified in Rule 506, and (3) should be
available to answer questions from prospective purchasers who are non-accredited
investors. The limitation on advertising and solicitation as well as the limitation to
35 non-accredited investors mean Rule 506(b) is not the most admirable
exception.
(ii) SEC Regulation Crowdfunding: Regulation Crowdfunding enables
eligible companies to offer and sell securities through crowdfunding.
Crowdfunding companies must (1) require all transactions under Regulation
Crowdfunding to take place online through an SEC-registered intermediary, either
a broker-dealer or a funding portal, (2) permit a company to raise a maximum
aggregate amount of $1,070,000 through crowdfunding offerings in a 12-month
18
328 U.S. 293, 298–99 (1946).
19
Schwartz, J., 2015. [online] Illinois Law Review. Available at: <https://illinoislawreview.org/wp-content/ilr-
content/articles/2015/3/Schwartz.pdf> [Accessed 7 July 2020]. (1161)
20
17 C.F.R. § 230.506 (2014).
21
17 C.F.R. § 227.100-503.

20
 period, (3) limit the amount individual investors can invest across all
crowdfunding offerings in a 12-month period, and (4) require disclosure of
information in filings with the Commission and to investors and the intermediary
facilitating the offering. Limitations on the amount of aggregate crowdfunded
earnings and trading period substantially decrease the desirability of this method.
If Sportfolio was to take a different method for funding and investing in
athletes, following Regulation Crowdfunding could be the most admirable option.
(iii) Brokerage Service: A third, more legally and financially
challenging, yet rewarding option is seeking registration as a brokerage service
under section 15(b) of the Exchange Act22. This would allow Sportfolio to offer
unlimited amounts of securities that were regulated by the SEC to unaccredited
investors. The process for registration is laborious and financially burdensome;
yet, becoming a brokerage service allowed past human equity investment firms to
succeed.
(iv) Lobbying: The last option would be to lobby the SEC, FINRA,
and/or CFPB to undergo a substantial overhaul for regulations surrounding
emerging human-equity investment firms. Persuading regulators to understand
that current security laws do not contextually or interpretively fit human-equity
investments might force new regulations that would clear up the blurriness
surrounding human-equity investments.

(c) Securities in the United States of America are maintained and regulated by
the Securities and Exchange Commission (SEC). Financial Industry Regulatory Authority
(FINRA) is a private nongovernmental organization that enforces rules governing brokers
and brokerages. Sportfolio and its athlete stocks will most likely need to file with the
SEC as a brokerage service and register with FINRA. A company that files a security
with the SEC must disclose the following information:
(1) A description of the company's properties and purpose.
(2) A description of the security being offered.
(3) Information about the company's management.
(4) Financial statements about the company, certified by independent accountants.

Section 3. Possible Complimentary Regulations:

Section 3a. Disclosure Requirements: Sportfolio aims to build trust and good-will
among its investors and investees and thus would require certain statements and terms in
the disclosure agreement. These include but are not limited to (1) the terms of the
agreement; (2) the investor’s future income forecast for the athlete over the term; (3) a
definition of what exactly counts as “income” for purposes of the agreement (6.1-2); (4)
the fees and commission charged by Sportfolio; (5) the exact dollar sum that the athlete is
receiving in exchange (after origination fees have been taken out); (6) the cost of equity
capital that relates (2) and (5); (7) the percent of income the athlete is required to
annually remit; (8) the amount of dollars the percentage set out in (7) equates to on an
22
15 U.S. Code § 78o

21
 annual basis based on the income forecast set out under (2); and (9) the sum of the
payments in (8), which would represent the total dollars the athlete would pay out for the
Shareholder Payout.

Section 3b. Contractual Limits and Limits on Transfer: Sportfolio lies well within
Schwartz’s recommended contractual limits on sharing length and equity percentage.
Schwartz recommends a sharing length less than 20 years23, Sportfolio has a trading
period of 4-5 years and an income receiving period of 0-1 years (exception for
Shareholder Payout loans). Schwartz also recommends an equity sharing percentage of
less than 35%24, Sportfolio offers a maximum equity sharing percentage of 19.5%
excluding earnings from capital gains. Sportfolio DIFFERS from Schwartz’s conclusion
that human-equity investments should be nontransferable. The liquidity of the market
falls on the market maker as well as the investors. To maintain the liquidity of the market,
the supply and demand of the stock are only one aspect of the volatile stock price. Time
since IPO, Accrued Year, etc. also effect the stock price using Sportfolio’s proprietary
trading system. Additionally, Schwartz claims the lack on constant information disclosure
acts negatively on the liquidity of human equity investments. However, at least during the
season, the bombardment of information, stats, and news provides enough circulation to
the fantasy sports industry, and should do the same to the human-equity investment sector
too.

Section 3c. A Role for the Consumer Financial Protection Bureau: Schwartz
recommended the Consumer Financial Protection Bureau (CFPB) aid in the regulatory
policing for human equity investments. The SEC is mainly focused on protecting
investors from malicious corporations. However, under the human equity sharing model,
both the investor and investee need human-centric protections. Sportfolio agrees,
supports, and will lobby for Schwartz’s recommendation of having the CFPB regulate
human-equity investments alongside the SEC for the benefit of investors and investees.

23
Schwartz, J., 2015. [online] Illinois Law Review. Available at: <https://illinoislawreview.org/wp-content/ilr-
content/articles/2015/3/Schwartz.pdf> [Accessed 7 July 2020]. (1171)
24
i.d.

22
 PART 2
MARKET
…
ANALYSIS

23
 ARTICLE 9
INDUSTRY OVERVIEW

Item 2019
College Football Fans (Total) 94,037,000
College Football Fans (Fantasy Sports Users) 4,633,000 (4.9%)
College Football Fans (Annual HH income $100,000+) 37,896,911 (40.3%)

NFL Fans (Total) 121,598,000

NFL Fans (Fantasy Sports Users) 19,261,000 (15.8%)
NFL Fans (age 50-64) 34,023,000 (28%)
NFL Fans (age 65+) 27,868,000 (23%)
NFL Fans (Annual HH income $100,000+) 45,200,000 (37%)

Total Fantasy Football Users 23,894,000

ARTICLE 10
TARGET MARKET

Section 1. Demographics: cdcocekce

24
Target market
Market size
Demographics
Trends
Competition
Direct competition
Indirect competition
Uniqueness
Entry barriers
Past Companies

KICKOFF

25
26