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PRIVATE CAPITAL (AGREEMENT)
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This Private Capital Agreement (the “Agreement”) is made on [Agreement date]
BETWEEN CYXLABS a company incorporated under the laws of the Federal Republic of Nigeria, having its registered address at 690 Idris Gidado Str,Wuye Abuja (the “Company” or “CYXLabs”);
AND
[Investor full legal name], of [Investor address] (the “Investor”).
The Company and the Investor are individually a “Party” and together the “Parties.”
Reach: +234 903 888 0228 | chat@cyxlabs.io
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1. PURPOSE
1.1 CYXLabs operates infrastructure supporting liquidity for merchant settlement.
1.2 The Investor wishes to provide private capital to CYXLabs, and CYXLabs wishes to accept such capital, subject to the terms of this Agreement.
1.3 Capital provided to CYXLabs and does not represent the purchase of units or a participatory interest in a separately managed investment pool.
2. PRIVATE CAPITAL
2.1 Principal: [Currency and amount]
2.2 Term: 24 months
2.3 Commencement Date: [Commencement date]
2.4 Maturity Date: 24 months from Commencement Date
2.5 CYXLabs may deploy the Private Capital toward merchant settlement liquidity, settlement capacity, provider and merchant integrations, settlement infrastructure and directly related working capital.
3. PRIMARY PRIVATE CAPITAL OBJECTIVE
3.1 The primary objective of the Capital is participation in the potential growth in the enterprise value of CYXLabs over the 24-month Investment Term through the Equity Conversion mechanism contained in this Agreement.
3.2 CYXLabs management targets a total outcome within a range of approximately 2× to 25× the Capital over the Term, based on the anticipated performance of the settlement operations and potential appreciation in CYXLabs' enterprise value.
3.3 The 2×–25× range constitutes a management target and forward-looking valuation scenario only. It is not a guaranteed return, valuation or exit.
Reach: +234 903 888 0228 | chat@cyxlabs.io
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4. REALIZED CAPITAL VALUE
4.1 For purposes of this Agreement,
4.2 Realized Capital Value means the value attributable to the Private Capital at the applicable realization or maturity date.
4.3 Realized Profit shall mean:
Realized Capital Value − Private Capital
4.4 No Performance Fee shall be charged against the Investment Principal itself.
5. PERFORMANCE FEES
5.1 CYXLabs shall only earn a Performance Fee where the Private Capital generates a positive Realized Profit.
5.2 Positive Outcome of 2× or Above
Where the Realized Capital Value is equal to or greater than 2× the Private Capital,
5.3 CYXLabs shall receive:
20% of Realized Profit
5.4 The Investor shall therefore be entitled to:
Investment Principal + 80% of Realized Profit
5.5 Positive Outcome Below 2×
5.6 Where the Private Capital generates a positive Realized Profit but the Realized Capital Value is below 2× the Private Capital,
5.7 CYXLabs shall receive:
10% of Realized Profit
5.8 The Investor shall therefore be entitled to:
Investment Principal + 90% of Realized Profit
5.9 No Positive Outcome
Reach: +234 903 888 0228 | chat@cyxlabs.io
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5.10 Where no positive Realized Profit has been generated:
No Performance Fee shall apply.
The Private Capital shall remain redeemable by the Investor in accordance with this Agreement.
6. MONTHLY REPORTING
6.1 CYXLabs shall provide the Investor with a monthly management & performance report containing, where applicable:
6.2 a. merchant settlement volume; b. settlement capital deployed; c. settlement revenue; d. directly attributable costs; e. eligible net settlement income; f. realized settlement return rate; g. liquidity position; h. material operational developments; and i. material risks.
6.3 The purpose of these reports is to provide the Investor with ongoing visibility into the financial health and deployment of the Private Capital.
6.4 Unless expressly identified as audited, monthly reports constitute management information and not audited financial statements.
7. MATURITY ELECTION
5.1 At the conclusion of the 24-month Term, the Investor shall elect one of the following:
7.2 OPTION A — CASH REDEMPTION
7.2.1 The Investor may elect to redeem the Investment.
7.2.2 The amount payable shall be:
Reach: +234 903 888 0228 | chat@cyxlabs.io
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Investor Net Entitlement = Private Capital + Realized Profit − Applicable Performance Fee
7.2.3 Where there is no Realized Profit, no Performance Fee shall apply and the Private Capital shall remain redeemable.
7.2.4 CYXLabs shall settle the applicable Redemption Amount within 90 days of the Maturity Date, subject to applicable law.
Upon full Cash Redemption, the Investor shall have no equity entitlement arising from the redeemed Investment.
7.3 OPTION B — EQUITY CONVERSION
7.3.1 Instead of Cash Redemption, the Investor may elect to convert the Investor Net Entitlement into equity of CYXLabs.
7.3.2 Accordingly:
Conversion Amount = Investment Principal + Realized Profit − Applicable Performance Fee
7.3.3 Where CYXLabs has completed a bona fide equity financing with an independent third-party investor (“Qualified Financing”), the valuation established in that financing shall form the basis for conversion, subject to the protection below.
8. CONVERSION PROTECTION
8.1 Where the applicable Private Capital Outcome at Maturity is below the 2× target threshold, and the Investor elects Equity Conversion rather than Cash Redemption, the Investor shall be entitled to convert at a:
20% discount to the applicable CYXLabs valuation.
Therefore:
Protected Conversion Valuation = Applicable Valuation × 20%
8.2 Where no Qualified Financing has established a valuation by Maturity, CYXLabs and the Investor shall agree the Company’s fair market value.
Reach: +234 903 888 0228 | chat@cyxlabs.io
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8.3 If the Parties cannot agree, an independent qualified valuer jointly appointed by the Parties shall determine the applicable valuation.
8.4 The cost of such valuation shall be shared equally.
9. RIGHTS FOLLOWING CONVERSION
9.1 Upon conversion, the Investor shall become a shareholder of CYXLabs and shall hold the resulting shares subject to the Company’s constitutional documents, applicable shareholders’ agreement and applicable law.
9.2 The Investor may thereafter:
hold the shares; participate in an available future financing; pursue a permitted secondary sale; participate in an acquisition or other permitted liquidity event.
9.3 CYXLabs does not guarantee the availability of a purchaser, secondary market, future financing, exit date or future share valuation.
10. ALTERNATIVE OUTCOMES
10.1 Cash Redemption and Equity Conversion are mutually exclusive.
10.2 The Investor may not receive Cash Redemption and simultaneously retain equity arising from the same Investment.
10.3 The 2×–25× target Capital Outcome represents CYXLabs’ projected performance objective.
10.4 It is not a guaranteed outcome.
10.5 The applicable 10% or 20% Performance Fee applies only to Realized Profit and never to the Private Capital.
11. RISK AND PRINCIPAL REDEMPTION
11.1 The Investor acknowledges that the Investment involves commercial, operational, liquidity and valuation risks and that the targeted 2×–25× Investment Outcome may not materialize.
Reach: +234 903 888 0228 | chat@cyxlabs.io
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11.2 Where the Investment generates no positive Realized Profit, no Performance Fee shall apply and the Private Capital shall remain due for redemption in accordance with this Agreement.
11.3 Nothing in this Agreement shall be interpreted as guaranteeing the projected 2×–25× Investment Outcome.
12. COMPLIANCE
12.1 Each Party shall provide information reasonably required for applicable KYC/AML and corporate compliance purposes.
12.2 The Private Capital, deployment, redemption and conversion shall remain subject to applicable Nigerian corporate, securities, tax and regulatory requirements.
12.3 Where any filing, approval, consent or regulatory action is legally required, the Parties shall cooperate in satisfying such requirement.
13. CONFIDENTIALITY
13.1 All non-public financial, commercial, technical and operational information exchanged under this Agreement shall remain confidential except where disclosure is required by law, regulatory authority or professional advisers bound by confidentiality.
14. GOVERNING LAW
14.1 This Agreement shall be governed by the laws of the Federal Republic of Nigeria.
14.2 Any dispute shall first be addressed through good-faith negotiation between the Parties.
14.3 Where unresolved within thirty (30) days, the dispute shall be referred to [Arbitration provision to be completed].
15. ENTIRE AGREEMENT
15.1 This Agreement constitutes the entire agreement between the Parties regarding the Private Capital and supersedes prior oral or written representations relating to its subject matter.
Reach: +234 903 888 0228 | chat@cyxlabs.io
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Any amendment must be made in writing and signed by both Parties.
16. EXECUTION
The Parties agree to be bound by this Agreement from the Effective Date.
FOR CYXLABS
Legal Name: CYXLABS [LIMITED]
Name: Iyanu Kayode Adewale
Title: Founder & Liquidity Manager
Signature: [Signature]
Date: [Signature date]
FOR INVESTOR
Full Legal Name: [Investor full legal name]
Address: [Investor address]
Investment Amount: [Currency and amount]
Signature: [Signature]
Date: [Signature date]
WITNESS
Name: [Witness name]
Address: [Witness address]
Occupation: [Witness occupation]
Signature: [Signature]
Reach: +234 903 888 0228 | chat@cyxlabs.io
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Date: [Signature date]
Reach: +234 903 888 0228 | chat@cyxlabs.io