A sandpit participant registers their new and innovative idea by way of a submission of a 1-2 page document to the Sandpit Manager. The document includes an assessment of the value of the idea that determines the allocation of Type 1 Conversion Notes to the Project Leader. The submission also details any additional or in-kind support requested from Kentron, as well as the number of Type 1 Conversion Notes being offered in the first 6-month period.
In consultation with the client company, and the Project Leader, the Sandpit Manager will either accept or reject the proposed project. If the project is accepted, and if a registration fee has been specified in the contract between Kentron and the client company, that registration fee is paid from the project’s (virtual) bank account to Kentron Ltd.
Potential contributors to the project are recruited by the Project Leader, or volunteers can present their interest in contributing to the project. The Project Leader has veto power over any potential contributors. In recognition of their efforts, contributors to the project are issued Type 2 Conversion Notes which are bound to that project.
Any Type 1 Conversion Notes made available during the first 6 months are offered for sale.
Six months after the start of the project, the value of the project’s Conversion Notes is reviewed, and a new offering of Type 1 Conversion Notes is agreed on by the Project Leadership Team. This reevaluation of Conversion Notes repeats every 6 months until termination of the project.
Once a project reaches a certain state of maturity, as specified in the contract between Kentron and the client company, it may spin off into a new company.
A project may terminate for a number of reasons. If a project terminates without spinning off into a new company, any remaining funds in the project account are distributed pro-rata to holders of Conversion Notes. Any IP held by Kentron Ltd on behalf of the project transfers to the holders of Type 1 Conversion Notes.