Document background
The Revenue Based Financing Agreement is designed for businesses seeking alternative growth capital without diluting equity or taking on traditional debt. This financing structure is particularly suitable for companies with predictable revenue streams operating in Pakistan, offering a flexible repayment mechanism based on the company's performance. The agreement, governed by Pakistani law, typically includes detailed provisions for funding amount, revenue share percentage, payment mechanics, reporting requirements, and cap on total repayment. It's commonly used by growing businesses that may not qualify for traditional bank financing or prefer not to pursue equity funding. The document ensures compliance with Pakistani financial regulations while providing clear guidelines for both the financing provider and recipient company regarding their rights, obligations, and the revenue-sharing mechanism.
