How do I Authorise a Growth Share Pool on Vestd?

The first step to issuing growth shares. This article will take you through adopting our Articles of Association, and Authorising a Growth Share Pool.

Adopting our Articles

Before you can Authorise a Growth Share Pool, and later issue Growth Shares, you'll need to  know whether your company Articles of Association are suitable for Growth Shares. If you are unsure, or if your company does not use the Model Articles, just get in touch with our team at support@vestd.com, and we will point you in the right direction.

If your company adopted the Model Articles on Incorporation, and has not made any amendments, you can easily follow the process of adopting the Vestd Articles of Association through the platform.

What these Articles contain is explained further down. Don't worry, you will have the chance to review everything before you commit.

First, log onto the platform and click Dashboard on the top left, then under Growth Shares go to View and Distribute:Screen Shot 2019-10-03 at 09.58.23

Which will take you here:

Screen Shot 2019-10-03 at 10.00.27

Clicking View & Adopt the Vestd Articles of Association will take you to the following page, outlining your Company Governance settings (in case you need to change them before sending out the resolutions), and giving you an overview of our Articles:

Screen Shot 2019-10-03 at 10.27.36

The page explains everything in a little more detail, but the gist is this:

  • These are based on British Venture Capital Association’s template articles of association, which are adopted by many early stage companies;
  • They have been adapted by our lawyers CMS;
  • The Articles have been drafted to ensure that existing or future SEIS & EIS shareholders will not be impacted, with respect to meeting HMRC qualifying criteria;
  • The Articles include “drag along and tag along” clauses in case of an exit. This ensures that any minority shareholders will have the right to be bought out in the case of the company changing hands, and the company can ensure that they are bought out, if they so want;
  • The Articles are drafted to limit any issues in the event of a non-cash acquisition of the company, such that the purchase to go ahead without problem (Article 20);
  • They allow you to issue conditional growth shares as well as options or ordinary shares;

At the bottom of the page, you will find a link to the Articles themselves, right above the Proceed button:

Screen Shot 2019-10-03 at 11.38.29

Feel free to download these and read through, or show these to your lawyers to make sure there are no aspects of your existing articles that won't be reflected in these new ones.

If you are happy to move ahead, just click Proceed at the bottom of the page. This will send the relevant resolutions to the Directors and Shareholders, and you will be notified when these have passed. Companies House will be automatically updated.

That's the wordy bit done. Once the resolutions have passed, or you have confirmed to us that your Articles are suitable for Growth Shares, you can go ahead and Authorise the Growth Share Pool.

Authorising the Growth Share Pool

This pool will be able to be used to issue both Voting (Vv) and non-Voting (Vn) growth shares.

First, log onto the platform, and go to Dashboard at the top left. Then, under Authorisations, click View All:

Screen Shot 2019-10-03 at 11.47.18

That will take you to this page:

Screen Shot 2019-10-03 at 11.47.55

Where you need to click Create new growth share authorisation (if that button isn't there, it means the resolutions have not yet passed):

Screen Shot 2019-10-03 at 11.49.41

Here, name the Authorisation for reference, and select the size of the pool you want to create.

Once you are happy, click next. That will take you to the following page:

Screen Shot 2019-10-03 at 11.50.56

This is where you upload the signed resolutions if you already have them. No problem if not, the platform can automatically generate them later and send them out for signing. Clicking Continue at the bottom will take you to this Review Page:

Screen Shot 2019-10-03 at 11.53.37

At the top of this page, check your company governance settings are correct. If they are not, click Update these details.

Check the size of the pool is correct. If you need to change anything, click the Edit link on the top right.

You can also preview the resolutions that will be send out. Just scroll towards the bottom of the page, and click the relevant links:

Screen Shot 2019-10-03 at 11.56.09

Once you are happy with the details, just click Submit at the bottom of the page. If you have not uploaded signed resolutions, they will be sent out to Directors and Shareholders.

If it has all gone wrong and you want to start over, just click Delete at the bottom of the page:

Screen Shot 2019-10-03 at 11.58.07

That's it, almost done!

Once the resolutions have passed, and the Growth Share Pool is live, you are ready to start Issuing Growth Shares!