How the ACQUA1 deal is structured
Capital structure, exchange mechanics, governance, and the path from token to realized value.
Deal Structure
Designed for QSBS eligibility and portfolio expansion.
C-Corp common equity tokenized under Reg D 506(c). The structure is built so future LabCo additions don't reset holding-period clocks or dilute existing share.
Structural Advantages
- Future Lab Companies added seamlessly to existing token structure
- No holding period reset when new ventures launch
- Automatic participation in portfolio expansion
- Single token provides diversified exposure across all companies
- Pro-rata economics simplify value calculation and distribution
Token Mechanics
ACQUA1 Token Structure & Valuation
$100M
Post-Money Valuation
$25M
Total Raise
250MM
ACQUA1 Tokens Issued
10:1
MERC → ACQUA1 Ratio
Exchange Mechanics
Purchase MERC
Purchase MERC at market price. MERC is Liquid Mercury's utility token.
Exchange at 10:1
Convert 10 MERC tokens into 1 ACQUA1 token via the secure swap mechanism.
Receive ACQUA1
Each ACQUA1 token is valued at $0.10. ACQUA1 value is not dependent on future MERC price.
Minimum: 5,000,000 MERC (500,000 ACQUA1) — $50,000 face value at $0.10 per ACQUA1. MERC is purchased at market price, so USD cost depends on the MERC market at purchase time.
Capital Deployment
Use of Proceeds
$25M capital deployment plan prioritizes innovation, defensibility, and revenue acceleration.
Liquidity
Value Realization
ACQUA1 monetizes through staggered liquidity events across the portfolio. The same model institutional venture portfolios use.
Short term
Individual Lab M&A
Strategic acquisitions and buyouts of individual portfolio companies as they reach acquirer-ready scale.
Medium term
Spin-Outs and IPOs
Public market exits for high-growth Lab Companies that achieve sustained scale and revenue visibility.
Short to medium term
Dividend Distributions
Recurring income from profitable Lab Company operations distributed to ACQUA1 holders pro-rata.
Long term
Secondary Liquidity
Token marketplace development as RWA secondary markets mature and standards solidify.
Governance
Governance & Transparency
Defined management structure, independent oversight, and transparent reporting to ACQUA1 holders.
Quarterly Reporting
Comprehensive financial and portfolio performance updates delivered to holders every quarter.
Third-Party Audits
Annual independent audits ensuring accuracy and institutional compliance.
Cap Table Transparency
Clear ownership structure and dilution disclosure at all times.
Board Oversight
Defined management structure and independent board supervision.
Tax Advantages
QSBS Benefits
C-Corp structure enables Qualified Small Business Stock treatment under IRC Section 1202 with tax benefits for eligible holders.
3+ Years
50% Exclusion
Half of eligible gains excluded from federal taxation upon qualifying disposition
4+ Years
75% Exclusion
Three-quarters of eligible gains excluded, significantly reducing tax burden
5+ Years
100% Exclusion
Complete federal tax exemption up to greater of $10MM or 10x investment basis
Investment Considerations
Upsides & Risks
Material upsides and risk factors for venture-stage tokenized digital securities.
Investment Upsides
Massive Market Opportunity
$10 Trillion RWA Market -- BCG projects Real World Asset tokenization reaching $10T by 2030.
Portfolio Diversification
Four Live LabCos + Pipeline -- Immediate exposure to diverse sectors with complementary risk profiles, with additional ventures in active development.
Aligned Interests
75% Management Retention -- Liquid Mercury maintains majority stake, ensuring complete alignment.
QSBS Tax Benefits
Greater of $10MM or 10x -- Qualified Small Business Stock structure provides exceptional tax treatment potential.
Seamless Expansion
Future Lab Companies added automatically without resetting holding periods or requiring additional capital.
Material Risk Factors
Company Performance Risk
Individual Lab Companies may underperform projections or fail entirely. Diversification mitigates but does not eliminate risk.
Liquidity Constraints
ACQUA1 tokens remain illiquid until individual company exits or secondary market development. No guaranteed timeline.
Regulatory Framework
Regulation D Rule 506(c) restrictions limit transferability to accredited investors. Resale restrictions apply per securities regulations.
Market Conditions
RWA tokenization market remains nascent with evolving regulatory landscape. Broader market volatility may impact valuations.
QSBS Compliance
Tax benefits require ongoing compliance with QSBS requirements including active business test and holding periods.
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