Home / Offering Memorandum / DEFINITIONS / Definitions

1.1. Definitions

• Administration Agreement

means any agreement for the time being subsisting between the Fund or any of its Investment Compartments and the Administrator and relating to the appointment and duties of the Administrator;

• Administrator

means the party acting as an administrator and described in the Memorandum;

• Administration Fee

means a fee payable to the Administrator by the Fund, its Investment Compartments or the Manager as further detailed in the Administration Agreement, the Articles, the Offering Memorandum and the relevant Supplements;

• Advertising Costs

means all marketing and advertising cost including mandatory publications provided by the AIF Law and the costs of the publications of the Fund;

• AIF or Alternative Investment Fund

means any collective investment undertaking, including Investment Compartments thereof, which, collectively: 

1. raises capital from a number of investors, with a view to investing it in accordance with a defined investment policy for the benefit of those investors; and 

2. does not require authorisation pursuant to section 9 of the Open-ended Undertakings for Collective Investments Law of 2012 or pursuant to the legislation of another Member State which harmonises the article 5 of the Directive 2009/65/EC;

• Alternative Investment Funds Law, AIF Law or AIF Law of 2018

means the Alternative Investment Funds Law N.124(I) of 2018, as may be amended from time to time;

• AIFM

means the alternative investment funds manager which falls within the scope of the Alternative Investment Fund Managers Law;

• AIFM Law

means the Alternative Investment Fund Managers Law of 2013, as may be amended from time to time;

• Alternative Investment Asset

means any non-traditional asset with potential economic value that would not be found in a standard investment portfolio. Due to the unconventional nature of alternative assets, valuation of some of these assets can be difficult Examples of alternative assets would include art and  antiques, precious metals, fine wines, rare stamps and coins, and sports cards and other collectibles. However, there are also more traditional alternative assets including hedge funds, venture capital-related projects and infrastructure, real estate properties and equity of private companies. In either case, alternative assets tend to be less liquid than traditional investments. Thus, investors who favor alternative assets may have to consider a longer investment horizon;

• Applicant

means the person applying for Units in the Fund;

• Articles or Articles of Association

means, the Articles of Association of the Company as amended from time to time;

• Assets not subject to custody

means the assets that belong to an AIF or to the Manager acting on its behalf, which cannot be included in the custody duties of the depositary, taking into consideration that the assets subject to custody include financial instruments that are capable of being registered in a financial instruments account maintained with the depositary or are able to be physically delivered to the depositary;

• Anti-Money Laundering Law

means the Prevention and Suppression of Money Laundering and Terrorist Financing Law 188(I) of 2007 or any Law substituting or amending the same;

• Auditor

means any successor company as may be appointed by the Company to act as the Auditor of the Company;

• Audit Fee

means a fee payable to the Auditor by the Fund and its Investment Compartments as further detailed in the Audit agreement and the Offering Memorandum;

• Business Day

means a day, other than Saturday or Sunday, which is a bank business day in Cyprus;

• Companies Law

means the Companies Law, Cap. 113, or any Law substituting or amending the same;

• Company

means CYGNATOR FUND RAIF V.C.I.C. LTD, a Variable Capital Investment Company established in accordance with the Companies Law, being the form of incorporation of the Fund under AIF Law;

• Consultation Agreement

means any agreement for the time being subsisting between the Investment Compartments and the Consultant and relating to the appointment and duties of the Consultant;

• Consultant

means any successor company as may be appointed by the Fund which will provide to the Investment Compartments consultancy services as further detailed in the Consultation Agreement and/or in the relevant Supplement;

• Consultancy Fee

means a fee payable to the Consultant by the Investment Compartments as further detailed in the Consultation Agreement, the Offering Memorandum and the relevant Supplements;

• Fund

means CYGNATOR FUND RAIF V.C.I.C. LTD registered as an AIF under the AIF Law including all its compartments thereof. Where the context so requires the term Fund shall mean any of the Investment Compartments as the case may be;

• Class of Units or Unit Class

means a particular division of Investor Units in an Investment Compartment as may be determined by the Management Shareholder after the proposal by the Manager;

• Cut-Off Date

means the applicable Business Day prior to a Valuation Day or such other time as the Manager may determine for an Investment Compartment or Class by which Investors shall be able to submit an application for subscription or redemption of Investor Units; 

• Cyprus

means the Republic of Cyprus; 

• CySEC

means the Cyprus Securities and Exchange Commission;

• CySEC Directives

means the directives issued by CySEC in exercise of its powers under the provisions of the AIF Law and AIFM Law, as published in the official gazette of the Republic of Cyprus;

• Dealing Day

means the first business day after the Valuation Day, or any other Business Day on which the Manager determined to give effect to an application for subscription and/or requests for redemption of Units in relation to  applications for subscription and/or requests for redemption of Units; 

• Depositary

means any company as may be appointed by the Manager of the Fund   to act as the Depositary of the Fund which is performed at least one of the indented duties of the depositary as defined in section 24 of the Alternative Investment Fund Manager Law; 

• Depositary Agreement

means any agreement for the time being subsisting between the Depositary and the Company and relating to the appointment and duties of the Depositary;

• Depositary Fee

means a fee payable to the Depositary by the Fund and its Investment Compartments as further detailed in the Depositary Agreement, the Articles, the Offering Memorandum and the relevant Supplements;

• Directors

means the members of the Board of Directors of the Company for the time being and any duly constituted committee thereof and any successors to such members as may be appointed from time to time;

• Directors Remuneration

means the remuneration and expenses of the members of the Board of Directors of the Fund as may be determined by the Manager from time to time;

• Distribution

means the payments of an Investment Compartment  to its unit-holders, other than the payments which relate to the redemption or repurchase of units;

• Duties and Charges

means all stamp duties, taxes, governmental charges, levies, exchange costs and commissions, transfer fees and expenses, agents’ fees, brokerage fees, commissions, bank charges, registration fees, and other duties and charges, whether payable in respect of the constitution, increase or reduction of all of the cash and other assets of the Company or the creation, acquisition, issue, conversion, exchange, purchase, holding, redemption, sale or transfer of Shares or Investments, by or on behalf of the Company or in respect of the issue or cancellation of share certificates or otherwise, which may have become or will become payable in respect of or prior to or upon the occasion of any transaction, dealing or valuation including Redemption Fees and Subscription Fees (if any) payable on the redemption and the issue of Investor Shares respectively;

• Eligible Investor

means Professional and Well-Informed Investors within the meaning of the AIF Law;

• Euro or EUR

means the currency used by the Institutions of the European Union and the official currency of the Eurozone;

• Facilitation Agreement

means any agreement for the time being subsisting between the Fund or any of its Investment Compartments and the Facilitator and relating to the appointment and duties of the Facilitator;

• Facilitator

means any successor company as may be appointed by the Fund which will provide to the relevant Investment Compartments the following services: (i) market presentation, (ii) identification of contacts, (iii) pre-qualification of contacts based on submission criteria mandated by the Manager including but not limited to non-binding proof of funds and non-binding know your counterparty details, (iv) suggest the contacts to the Manager and (v) schedule the first meeting between the Manager and potential investors;

• Facilitation Fee

means a fee payable to the Facilitator by the relevant Investment Compartments as further detailed in the Facilitation Agreement, the Offering Memorandum and the relevant Supplements;

• Financial Instrument

means all the assets defined as financial instruments in the article 2 (1) of the Law which provides for the provision of Investment Services, the exercise of investment activities, the operation of regulated markets and other related matters of 2017 (Law 87 (I)/2017);

• First Accounting Period

means the period starting from the date of incorporation of the Fund and ending on 31 December of the year of incorporation;

• Financial year

means the accounting period of the Company ending on 31st December of each year, unless otherwise determined by the Directors;

• High Watermark

means the highest peak in value of the Investment Compartment over and above which the Manager is entitled to receive the Performance Fee as set out in an agreement, the Offering Memorandum or the relevant Supplement; 

• Hurdle Rate

means the minimum pre-set threshold rate of return (if any) of an Investment Compartment over and above which the Manager is entitled to receive the Performance Fee as set out in the Offering Memorandum; 

• Income Tax Law

means the Cyprus Income Tax Law N.118(I) of 2002 as may be amended from time to time; 

• Ineligible Person

means any person, firm or corporation applying for subscription of Investor Units or a holder of Investor Units 

1.  that for legal, tax, regulatory or any other reason, or 

2.  does not meet the requirements of a Professional or Well-Informed Investor 

and which from time to time, is determined by the Manager, in their sole discretion, to be ineligible to be a holder of Investor Units; 

• Investment Compartment

means a separate and segregated portfolio of assets and liabilities and having its own characteristics specified in the relevant Supplement appended in the Offering Memorandum; 

• General Meeting

As defined in the Articles of the Company;

• Group or Investment Group

means the Fund and all its subsidiaries and associates;

• Initial Capital

means the minimum net assets that:

1. required by the AIF Law; and

2. consists of-

• the issued and paid-up capital of a class of shares that is not created for investment purposes, in which the difference from the issue of shares at a premium is added, with the exception of cumulative privileged shares; and

• the reserves referred to a class of shares that is not created for investment purposes, with the exception of revaluation reserves, and the undistributed earnings from previous years attributable to a class of shares that is not created for investment purposes and which are transferred to the profit and loss account through the disposal of the final result; and

3. cash or assets immediately convertible into cash; 

• Initial Offering Period (IOP)

means the period during which Investor Units of an Investment Compartment or Class (as applicable) may be offered by the Manager for subscription at the Initial Subscription Price as set out in the Offering Memorandum and Supplements;

• Initial Subscription Price

means the initial fixed price at which any Investor Units of an Investment Compartment or Class may be offered for subscription during an Initial Offering Period, or in case there is no Initial Offering Period, on the first Dealing Day, as determined in the Offering Memorandum or the relevant Supplement and adding thereto such sums as may be determined as an appropriate provision for Duties and Charges; 

• Initial Subscription Date

means the starting date of the Initial Offering Period which shall be upon Investment Compartment registration;

• Investment Advisor or Investment Committee

means any person or group that makes investment recommendations or conducts investment analysis in return for a fee. This person or group is responsible for the provision of specialist research, market knowledge and strategic advice to the Fund or its Investment Compartments, to solve any problems raised and maximize its opportunities. Investment advice may include strategic company reviews, market research, advice on the purchase, sale or leasing of a private company, due diligence, assessing portfolio mix, syndicate management, etc.;

• Investment Advisory Fee

means the fee payable to the Investment Committee or the Investment Advisor(s) as may be appointed from time to time by the Fund or its Investment Compartments for the provision of investment advisory services; 

• Investments

means any investment or other asset of any description which an Investment Compartment is entitled to acquire, purchase, trade or invest in, in accordance with the Offering Memorandum and the provisions of the Articles of Association;

• Investment Management Agreement

means any agreement for the time being subsisting between the Fund and the Manager in relation to the appointment and duties of the Manager. A copy of the Investment Management Agreement may be obtained from the Manager;

• Investment Management Delegation Agreement

means any agreement for the time being subsisting between the Manager and a third party in relation to the delegation of obligation and duties of the Manager;

• Investor

means a person wishing to invest in any Investment Compartment by way of Investor Units acquisition or any registered holder for the time being of Investor Units, where applicable;

• Investor Profile

means the investment profile of the Eligible Investors as  provided in the Offering Memorandum, decided from time to time by the Manager and specified in the Supplements for each Investment Compartment separately;

• Investor Units or Unit(s)

means redeemable participating Units in the capital of the Company which may be designated in one or more Classes, issued in accordance with the Offering Memorandum and the provisions of the Articles;

• Investment Policy or Investment Strategy

means the Fund’s and its Investment Compartments investment policy as set out in the Offering Memorandum and the relevant Supplement; 

• Law

means the Companies Law Cap. 113, as amended from time to time;

• Local Law

means the  law of a Target Market read in context;

• Leverage

means the method by which 

1.  the Manager increases the risk exposure of a Fund it manages, 

2.  the Fund, which is an internally managed Fund, increases its risk exposure,

either through borrowing of cash or securities, or leverage embedded in derivative positions or by any other means;

• Limited Liquidity Arrangements

Means the liquidity arrangements or mechanisms applied to an Investment Compartment, including but not limited to any applicable Lock-Up Periods, deferral policies etc., with the aim to limit the Redemption rights of its Investors;

• Lock-up Period

means the period of time in which Investors are not allowed to redeem or sell Investor Units of the Investment Compartment as described in the Offering Memorandum and the relevant Supplements, which is may extend up to five years from the anniversary date of the relevant Investment Compartment’s  activation date as may be extended by the Manager at its discretion for up to two additional anniversaries with an option to extend for one year and then a year further for  a maximum of a total of seven years. Such extensions may only be applied having regard the provisions of the Categorization Directive DI131-2014-03 or any other instrument in force at the time setting-up rules relating to Lock-up Period;

• Management Fee

means a fee payable to the Manager by the Fund and its Investment Compartments as further detailed in the Investment Management Agreement, the Articles, the Offering Memorandum and the relevant Supplements;

• Management Shares

means the non-redeemable voting shares in the capital of the Company;

• Management Shareholder

means the holder of Management Shares;

• Manager

means any company as may be appointed by the Fund from time to time to act as the External Manager of the Fund in accordance with the AIF Law and subject to the terms and conditions of the Investment Management Agreement;

• Memorandum or Offering Memorandum

means the Offering Memorandum of the Fund and the Supplements;

• Memorandum & Articles of Association

means the Memorandum & Articles of Association of the Company;

• Memorandum

means the Memorandum of Association of the Company;

• Minimum Capital Raising Amount

means €500,000.00 for each Investment Compartment or higher if specified in the Supplement of an individual Investment Compartment. The minimum amount of funds required to be raised within the subscription period, in order for the relevant Investment Compartment  to continue its investment plans. If this level is not covered, all funds raised for the relevant Investment Compartment, will be returned to the Investors;

• Minimum Subscription Amount

means the minimum amount or value of Investor Units that must be subscribed for the relevant Investment Compartment or Class, as may be specified from time to time in the Offering Memorandum and the relevant Supplement;

• Minimum Additional Subscription Amount

means the minimum amount or value of additional Investor Units that must be subscribed for by any Investor in the relevant Investment Compartment  as may be specified from time to time in the Offering Memorandum and the relevant Supplements;

• Minimum Holding

means either a holding of Units in a Fund or Class the value of which by reference to the Net Asset Value per Unit is not less than such amount as may be determined by the Manager from time to time or such minimum number of Units, if any, which must be held by Investors in any Investment Compartment or Class as specified in the relevant Supplement;

• Month

means a calendar month;

• Net Asset Value or NAV

means the net asset value of Units of each Investment Compartment at any particular Valuation Day as detailed hereinafter; 

• Net Asset Value Per Unit

means the Net Asset Value of each Investment Compartment divided by the number of Investor Units in issue for the relevant Investment Compartment;

• Net Profits

means the Profit After Tax as it appears in the annual audited  financial statements of the Fund prepared in accordance with International Financial Reporting Standards;

• Open-Ended Structure

means an AIF or any one of its Compartments, subject to the provisions of their individual Supplements, which allows for Redemptions of Investor Units prior the initiation of its Liquidation process, directly or indirectly from its own assets and in accordance with the rules and frequency defined in its Articles, this Offering Memorandum and any relevant Supplement, subject to a relevant request from any of its Investors and to any Limited Liquidity Arrangements in place, if applicable;

• Performance Fee

means a fee payable to the Manager based on the performance of the introduced investments as further detailed in the Offering Memorandum and the relevant Supplements;

• Portfolio

means the investment assets held by each Investment Compartment  from time to time;

• Professional Investor

means an Investor which is considered to be a professional client or may, on request, be treated as a professional client within the meaning of Second Appendix of the Investment Services and Activities and Regulated Markets Law 87(I)/2017 as amended;

• Project

means any project that an Investment Compartment  will invest;

• Project Company

means all Special Purpose Vehicles (‘SPVs’) and intermediary holding companies that the Investment Compartment(s) may invest through, depending on the requirements of local law and tax considerations;

• Redemption Day

means any business day, as the Manager determines, being a day on which Investors, may redeem Investor Units in accordance with the Offering Memorandum; 

• Redemption Fee

means such amount or amounts payable on the redemption of Investor Units which may be deducted and retained from the redemption proceeds, as further detailed in the Offering Memorandum;

• Redemption Price

means the price at which Investor Units shall be redeemed by the relevant Investment Compartment at the request of an Investor calculated in accordance with the provisions of the Offering Memorandum;

• Reference Currency

means the currencies in which the Investment Compartments   or Classes are denominated as specified further in the Offering Memorandum and Supplements, and in case of an Investment Compartment, it is the currency on the grounds of which the Net Asset Value of the relevant Investment Compartment is calculated;

• Redemption Proceeds

has the meaning assigned to it in the Offering Memorandum;

• Register

means the register kept by the Administrator of each Investment Compartment into which the names and addresses of, and the number of and Class of Investor Units held by Investors are entered;

• Registered Office or Office

means the registered office provided for in section 102 of the Companies Law;

• Restricted Person

means a person determined by the Manager as such defined  further herein or in any of the Supplements;

• Secretary

means any person, firm or corporation appointed to perform the duties of the secretary of the Company;

• Set up fee

means the fee payable for the set up and launch of the Fund and its Investment Compartment(s) and shall include inter alia the preliminary expenses incurred in connection with the incorporation of the Company, the obtaining by the Fund of authorisation from the Regulator or registration with the Regulator (as applicable) and the launch of the first Investment Compartment including the costs and expenses of preparing, publishing and distributing the Offering Memorandum and other documents and all professional and legal fees and costs incurred in connection therewith; it is to be clarified that such professional fees include, among others, the cost of opening the account with the Depositary, a credit institution and the set-up of the ledger with the Administrator;

• Subscription Fee

means any such amount or amounts payable by the Investor on the issue of Investor Units in an Investment Compartment as further detailed in the Offering Memorandum or the Supplements thereof;

• Share

means a share of no par value in the share capital of the Company including Management Shares and Investor Units;

• Subscription Application

means the application of each Investor for subscribing for Investor Units in a particular Investment Compartment or a Class of the particular Investment Compartment;

• Subscription Period

means the period set by the Manager as the Subscription period for Investor Units, as defined in the Subscription Agreement;

• Subscription Price

means the price at which Investor Units shall be offered, outside the Initial Offering Period, calculated in accordance with the provisions of the Offering Memorandum and the Articles of Association and adding thereto such sum as the Manager may determine as an appropriate provision for Duties and Charges;

• Subsidiary

As defined by the Law;

• Supplement

means any Supplement to the Offering Memorandum of the Fund that may be issued from time to time, forming an integral part hereto and which is to be read in conjunction thereto, outlining information in respect of an Investment Compartment;

• Target Market

means the Target Market of a particular Investment Compartment as further detailed in the Offering Memorandum and the relevant Supplement;

• Total Capital Raising

means the total number of Investor Units multiplied by the Subscription Price at which each one was issued;

• ESMA

means European Securities and Markets Authority 

• EURO, €

means the currency used by the Institutions of the European Union and the official currency of the Eurozone; 

• Unit-holder

means the holder of a unit or a fraction of a unit;

• Valuation

means the Net Asset Value of an Investment Compartments an aggregate value of the Investment Compartment’s consolidated assets minus consolidated liabilities, including the Investment Compartment’s interest received, uninvested cash, accounts receivable, accrued interest, deferred tax and accounts payable, in accordance with the Investment Compartment's accounting policies. The Net Asset Value will be calculated at the close of business on each Valuation Date and on any other date the Manager of the Fund at their sole discretion determine;

• Valuation Date or Valuation Day

means a Business Day on which the Net Asset Value is determined or any other day as shall be determined by the Manager from time to time or as specified in the Offering Memorandum or Supplements;

• Valuer/s

means any internationally recognized qualified property valuers, independent auditors or valuators or financial instruments hired by the Fund or any of its Investment Compartments from time to time as required;

• Variable Capital Investment Company

means a company established or converted as variable capital investment company in accordance with the Law and operating as a Fund in accordance with the relevant provisions of the AIF Law; 

• Well–Informed Investor

means every Investor which is not a Professional Investor and fulfils the following conditions: 

1. confirms in writing that 

• he possesses sufficient knowledge and experience in financial and business matters in order to be able to evaluate the benefits and risks associated with the planned investment in the Fund’s Compartments and he is aware of the risks associated with the planned investments of the Fund’s Compartments; or 

• his business activities are related with the management, acquisition or disposal of assets, either on his own account or on behalf of third parties, which are of the same type as the investments of the Compartment(s) he wishes to invest in; and 

• his investment in a Compartment of the Fund is at least equal to the minimum of EUR 125,000 (one hundred twenty five thousand euro) (or currency equivalent); or 

• he has been assessed as a well-informed investor by a credit institution, or by an AIFM or by a UCITS management company or by an investment firm or by a manager which is licensed in the Republic of Cyprus or in another EU member state for the management of AIFs whose assets under management do not exceed the thresholds laid down in article 4(2) of the AIFM Law or the corresponding article 3 paragraph (2) of Directive 2011/61/EU, and the above mentioned assessment indicates that he possess sufficient knowledge and experience in financial and business issues to be able to evaluate the benefits and risks associated with the planned investments of the Fund’s Compartment(s) based on its (their) investment policy(ies); or 

• he is employed by any of the entities mentioned in subparagraph (ii) of paragraph (b) above and receive total remuneration that takes him into the same remuneration bracket as persons who effectively conduct one of the business activities of the entities mentioned in subparagraph (ii) of paragraph (b) or as the executive members of their government body who effectively conduct one of their business activities; whereas 

3. without prejudice to paragraphs (a) and (b), persons who direct the Manager or they are assigned with portfolio management duties related with the Fund.

Wholly Owned Subsidiary means a subsidiary company whose share capital is entirely owned by the holding Company;