|1||SPORTBLX/PJ WASHINGTON INC. ("PJ WASHINGTON Inc" ) intends to revolutionize fan engagement.|
|2||Invest with a professional athlete and potentially generate income with a unique sports asset.|
|3||Be part of sports finance history with a new alternative asset class.|
|4||Preferred stock dividends accrue at 5% a year, payable in preference to common stock|
|5||Any additional declared dividends are paid pro rate with common stock.|
|6||These types of investment opportunities are traditionally reserved only for institutions.|
|7||Diversify your portfolio with a potential yield that has low stock market correlation.|
|8||You can buy shares for anyone who is a sports fan - yourself, your family, or your friends.|
SportBLX/PJ WASHINGTON, Inc. ("PJ WASHINGTON, Inc.") unlocks sports asset ownership for a fan or investor and provides access to an income-generating security with potential upside from the corporation’s earnings.
You are investing in preferred stock of PJ WASHINGTON, Inc., a company that focuses on generating profits from non-exclusive services in brand management, wealth management, strategic investments, data analytics, consulting, and other businesses operations associated with PJ Washington Jr. and his company PJW LTD. PJW LTD. was established as a savings and investment vehicle for PJ Washington Jr.’s future earnings.
Additionally, PJ Washington, Inc. may invest in Promissory Notes issued by PJW LTD. Income from these promissory notes will add to the revenues of the corporation. Net proceeds of the offering may also be invested in limited partnership interests of The Sports & Entertainment Fund LP, which is managed by Adara Asset Management LLC.
Preferred stock dividends accrue at 5% a year, payable in preference to common stock as and when declared by the board, plus any additional declared dividends are paid pro rate with common stock.
Preferred shares will be redeemed on June 6, 2030, or earlier at the option of the company, at the original issue price plus all accrued and unpaid dividends.
PJ Washington Jr. (the "Athlete") is an American professional basketball player for the Charlotte Hornets of the National Basketball Association. PJ was born in Louisville, KY and grew up in Dallas, TX. He was drafted in the first round (12th overall) in the 2019 NBA draft and played college basketball for the Kentucky Wildcats under head coach John Calipari.
PJ was an NCAA All-American in 2019 at the University of Kentucky. In his first NBA game, the 21-year-old made 7 three-pointers, the most in a debut in NBA history. PJ was selected to the 2020 NBA Rising Stars game alongside players such as Luka Doncic, Trae Young, and Zion Williamson. PJ looks to continue his impressive rookie season once the NBA resumes play.
How Is PJ Washington Jr. Involved?
PJ Washington Jr. is a shareholder of SportBLX/PJ WASHINGTON Inc (the “Company”or "PJ WASHINGTON Inc."). The Company was formed for the purposes of developing the brand of the Athlete, growing his income streams, and identifying additional revenue sources. The Company aims to provide sports fans with a unique opportunity to participate in the ownership and growth of the career of this dynamic athlete.
The Athlete also has a savings and investment agreement with PJW LTD., which is issuing Promissory Notes that PJ WASHINGTON Inc. may invest in. PJW LTD. has provided the Athlete with capital upfront in return for fixed periodic payments. Investors in PJW LTD. Promissory Notes are contracted to receive fixed income returns.
PJ WASHINGTON Inc is different from companies you typically encounter on crowdfunding platforms such as Wefunder.
In the case of PJ WASHINGTON Inc, the public has access to invest in a unique sports asset ordinarily reserved for institutions and or high-net worth investors. This investment is associated with an NBA Rising Star. Investors are purchasing an interest in PJ WASHINGTON Inc., which is being offered on the SportBLX platform for accredited investors (Reg D) and here on Wefunder for non-accredited investors (Reg CF). Preferred stock dividends accrue at 5% a year, payable in preference to common stock as and when declared by the board, plus any additional declared dividends are paid pro rata with common stock. Preferred shares will be redeemed on June 6, 2030, or earlier at the option of the company, at the original issue price plus all accrued and unpaid dividends. The company's business operations focus on generating profits from non-exclusive services in brand management, wealth management, strategic investments, data analytics, consulting, and other businesses operations associated with PJ Washington Jr. and his company PJW LTD.
Money raised from this offering will go towards value generation to the long-term benefit of PJ Washington Jr., his family, and shareholders.
Benefits for fans and investors
Benefits for the athlete
SportBLX/PJ WASHINGTON Inc. has financial statements ending June 30 2020. Our cash in hand is $0, as of August 2020. Over the three months prior, revenues averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $3,000/month.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
SportBLX/PJ WASHINGTON Inc. (the “Company”) is a newly-formed Delaware corporation incorporated on June 8, 2020 by Sport-BLX Securities, Inc. (“SportBLX Securities”) (owning 300,000 common shares) and Paul J. Washington Senior (“Mr. Washington Sr.”) (owning 50,000 Shares) and Paul J. Washington Junior (“Mr. Washington Jr.” or the “Athlete”) (owning 50,000 shares). The CEO of the company will be Paul Washington Sr.
Mr. Washington Jr., together with Sport-BLX, Inc., an affiliate of SportBLX Securities, has formed PJW LTD., a Cayman Islands limited company, for the purpose of saving, investing and protecting his financial future, (“PJW LTD” or the “Note Issuer”).
The Company was created (i) to further the goals of PJW LTD by enhancing the Athlete’s financial returns, (ii) to generate income from the brand of the Athlete, leveraging the expertise of SportBLX Securities and its affiliates (collectively, “SportBLX”) and the networking capabilities of Mr. Washington Sr., (iii) and to provide similar management and monetization strategies to other athletes.
The focus of the Company is to generate profits primarily through the development and monetization of the brand of the Athlete, to provide services to PJW LTD and to Mr. Washington Jr. regarding his capital accounts, assisting the Athlete in growing his income streams, and identifying and exploiting additional revenue sources that would not otherwise be available to him. The Company may also provide financial and risk management consulting services to other athletes for a fee. Our business is focused on the following core areas:
Brand Management Consulting. We provide consulting services to the Athlete and potential sponsors, to enhance the value of the Athlete’s brand and curate opportunities to monetize the Athlete’s brand through investment and merchandising opportunities. Our services will generate customary fees paid by the Athlete or third parties to the Company.
Wealth Management. The Company will provide investment advice regarding the management of assets in PJW LTD. The Company may enlist subadvisors in managing these assets. The Company may also advise PJW LTD on investment manager selection.
Strategic Investment. As a result of their popularity, social media presence, and unique brand attributes, athletes may have the opportunity to invest in companies on preferential terms. The Company will assist the Athlete in capitalizing on these opportunities to deploy strategic capital, for which it expects to earn customary fees, leveraging the wealth of experience of SportBLX Securities and its principals.
Financial Consulting – The Company may serve as a consultant to other athletes with a focus on savings, investment and opportunities to monetize and invest their future earnings. These services may include structuring savings and investment vehicles similar to PJW LTD.
Data Monetization. Through our relationship with the SportBLX platform and access to its user database of sports enthusiasts and investors, we will have exclusive data about the Athlete’s fan base. We will utilize this information to develop targeted monetization opportunities for the Athlete that would not otherwise be apparent.
Risk Management. We provide consulting services to hedge certain risks for the benefit of PJW LTD. The Company assists PJW LTD, and in some cases the Athlete, on assessing risk exposure to help determine insurance needs and other risk mitigation mechanisms and intends to provide similar services to other athletes.
Recruitment Activities. We expect to recruit other athletes to join the SportBLX platform and to want to structure similar savings and investment vehicles for them as we have for the Athlete. We believe successful recruitments will increase market awareness of the Company through cross-marketing and promotional opportunities and create value through combining our Athlete fan base data with similar data for other athletes. Sport-BLX Securities is expected to pay us a monthly retainer and success fees for our recruitment activities.
Value Management. We will identify and recommend opportunities to adjust the capital structure of PJW LTD. These activities may include the Company analyzing future changes in interest rate markets and demand and the impact to the PJW LTD.and offering advice to PJW LTD on its options for refinancing and trading.
Investments. We will invest in Promissory Notes issued by PJW LTD, the Note Issuer, and may invest in limited partnership interests of the S&E Fund, as discussed below. We may also invest our capital in strategic and non-strategic ways with the goal of generating strong risk-adjusted returns. These investments, which will be identified by our management team together with SportBLX Securities’ team of professionals, may be in real estate, mortgages or other financial assets.
Given the Company’s limited operating history, the Company cannot reliably estimate how much revenue it will receive in the future, if any.
Shares of securities issued by the Company will be listed on Sport-BLX Inc.’s platform for Reg D offerings along with Wefunder’s portal.
The Company intends to purchase promissory notes of PJW LTD., a corporation owned by PJ Washington Jr.. PJW LTD. receives periodic contributions from PJ Washington Jr, and in turn pays periodic interest payments to SPORTBLX/PJ WASHINGTON Inc. under the promissory note. The Company may also purchase limited partnership interests of the S&E Fund, which is managed by Adara Asset Management LLC (“Adara”). The Company’s funds invested in the S&E Fund will be subject to a management fee of 1% per annum of the amount of the Company’s capital account in the S&E Fund and a performance fee equal to 20% of any net capital appreciation on that capital account, in each case payable to Adara by the S&E Fund. The S&E Fund will engage in swap transactions with PJW LTD.
The Company intends to conduct its operations so as not to become an “investment company” required to register under the Investment Company Act and, therefore, the maximum amount that the Company will invest in securities, including the promissory notes and the limited partnership interest, will be no greater than 40% of the value of its total assets, exclusive of government securities and cash items.
Historical Results of Operations
Our company was organized in June 2020 and has limited operations upon which prospective investors may base an evaluation of its performance.
Related Party Transaction
Refer to Question 26 of this Form C for disclosure of all related party transactions.
Liquidity & Capital Resources
Concurrenly with this offering, we are offering preferred shares in an offering under Regulation D of the Securities Act, for a maximum offering amount of $10 million, less any amounts raised in this offering. After the conclusion of this Offering, should we hit our minimum funding target of $XX, our projected runway is 12 months before we need to raise further capital.
We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.
We will likely require additional financing in excess of the proceeds from this Offering and the concurrent offering under Regulation D in order to perform operations over the lifetime of the Company. We plan to raise capital in 6 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from these offerings. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.
Runway & Short/Mid Term Expenses
SportBLX/PJ WASHINGTON, INC. cash in hand is $0, as of August 2020. Over the last three months, revenues have averaged $0/month, cost of goods sold has averaged $0/month, and operational expenses have averaged $3,000/month, for an average burn rate of $3,000 per month. Our intent is to be profitable in 1 month. Post-closing, assuming the Company receives revenues from operating activities and receives interest income from its investment in promissory notes of PJW LTD., it will operate with a limited expense budget and strive to achieve profitability.
There have been no material changes or trend moves in our finances or operations since the date our financials cover.
If we're able to raise $2,000,000 (in this offering and through private raises) we would expect revenue to be between 70k-140k with expenses in the 35k-70k in the next 6 months (these projections cannot be guaranteed). Expenses will be scaled by the amount of capital raised. The company will determine what the best use of funds will be and execute based of that plan.
As of the date of this offering there are no other sources of capital that can be relied upon. The company does not have other funds to use to cover short term operations.
The financial condition and performance of our company is highly dependent on the success of the Athlete and value of the Athlete’s brand, which are subject to a number of risks, both with respect to our ability to generate revenue from our core operations as well as the ability of the Note Issuer to make payments on the promissory notes that may comprise a substantial percentage of our assets.
Our future success depends on the efforts of a small management team. The loss of services of the members of the management team may have an adverse effect on the company. There can be no assurance that we will be successful in attracting and retaining other personnel we require to successfully grow our business.
The Athlete is a recent draft pick with very limited history in the NBA, which renders any analysis of his future earnings potentially speculative.
The Athlete’s brand may be hurt by negative publicity.
Events in the Athlete’s personal life could have a significant impact on the Athlete’s performance on the court.
There can be no assurance that the Athlete’s brand value will not decline in the future.
The Athlete’s brand may be adversely affected by a player strike or other work stoppage.
The Athlete’s contract could be terminated for violations of the NBA conduct rules.
Future changes to the NBA rules or other regulations may adversely affect the brand of the Athlete.
A substantial decline in the popularity of the NBA could negatively impact the Athlete’s brand value.
If the Athlete ceases playing in the NBA for any reason, the value of your investment may be negatively impacted.
Global Risks and Market Disruption; COVID-19.
We do not have a conflicts of interest policy.
The Company’s management team will not operate full time.
We are an early stage company with a limited operating history.
You could lose some or all of your investment.
The placement fee and your payment of broker commissions further reduces your return on investment.
The Company is not subject to regulatory oversight.
The Shares will have limited liquidity.
The Company expects that a significant portion of its assets, up to 40%, may consist of the promissory notes, which exposes the Company to counterparty risks.
The Company may sustain a loss as a result of the failure of the Note Issuer to comply with the terms of the promissory notes. Such counterparty risk is accentuated by the longer maturity of the promissory notes, as events may intervene that negatively impact the Note Issuer’s ability to make payment on the promissory notes or increase the risk of our investment in these notes.
If SportBLX, the majority holder of the Common Stock of the Company, or the Note Issuer files for bankruptcy or becomes the subject of an involuntary bankruptcy proceeding, the Company may be consolidated into their respective bankruptcy estate.
There is currently no public trading market for our shares.
If a market ever develops for our Shares, the market price and trading volume may be volatile.
Holders of Shares have no voting rights other than those required under Delaware law and no direct rights to any of our assets.
This offering is being conducted on a best efforts basis and we may not be able to execute our growth strategy if we are unable to raise this capital.
Possible changes in federal/local tax laws or the application of existing federal/local tax laws may result significant variability in our results of operations and tax liability for the investor.
We determined the valuation of the company internally based on our own assessment of the company's current and future value, as well as relative risk for investors investing in similarly situated companies. The price of the preferred shares in this offering was determined based on several factors, including using an determination as to what an investor could earn from the shares factoring in assumptions for risk and a discount rate. However, this is an internal estimate based on many factors, and subject to risks, including those described in this "Risk Factors" section.
Prior to 2011, our CEO, Mr. Washington Sr. had a history of debt defaults, foreclosures and bankruptcies, which may negatively impact our reputation and make it difficult to grow our business.
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