Seedrs Nominee Agreement
In the absence of a registered agreement, investors would hold the shares of each holding company directly as registered shareholders. It`s hard to exaggerate the problems this can cause when there are a large number of investors, each of whom makes many small investments. Investors are left to manage their own investments, follow corporate events, attend meetings and give consent as needed. The bureaucratic burden alone can be painful, but the much bigger problem is that there are no coordinated efforts to monitor and enforce shareholder rights. And without this kind of coordinated effort, minority shareholders can easily fall victim to abusive actions by directors and majority shareholders. As a company, we have incentives to maximize returns for investors. We support a 7.5% deferral of all profits that investors make with their investments through Seedrs. When investors don`t make a profit, we don`t get paid for the work we do as a candidate. To ensure that our investors get the professional protection they deserve and that entrepreneurs don`t end up with messy and hard-to-manage capitalization tables, we act as a designated shareholder on behalf of Seedrs investors. Beneficial Ownership Agreement means the agreement by which Buyer and Seller agree to transfer beneficial ownership of the shares held under Seedrs` nominee structure; One of the key features of Seedrs is our nominee structure, where we own and manage startup shares on behalf of the underlying investors once the investment is complete. But investing is very different from buying a product, and what happens after the transaction is closed is much more complex if it is an investment. A different structure – one where the platform does not simply disappear from the image, but takes the necessary steps to ensure that investors and entrepreneurs benefit from the agreement – is needed. In short, this is what the structure of seedrs candidates is.
Investors don`t have to worry about managing their investments. We ensure that their investments are protected both by the legal requirements of shareholders and by the professional contractual protection that exists under our subscription and shareholder agreements with each company. 4.10. The Company agrees that the shares we hold as nominee may be made available for sale and purchase on the secondary market and subject to variable prices, unless otherwise agreed. If you`re still not sure what our candidate structure means for managing investments in companies, you can check out this blog post or some of its benefits here. Secondary Market means the Seedrs secondary market hosted on the website under www.seedrs.com/secondary-market; But it`s not just about making life easier for entrepreneurs; It is also a crucial element to ensure that the startup can raise more funds at all levels. Financing private companies can be complex, and often various approvals, waivers, and other unanimous shareholder lawsuits are required for the company to raise additional funds. If obtaining approval depends on the search for hundreds of investors across the country (or worldwide), approval is never obtained in practice, and it is very likely that funding will not be able to be carried out.
As countless angels and venture capital firms have told us, if they saw a widely dispersed shareholder base without candidates, they would be deeply hesitant or even completely reluctant to invest in the company. The startup died in the water because its investment base makes it impossible to raise more capital. 19.1. Communications from you to us. Any notice from you regarding these Terms or your Campaign will be emailed to email@example.com, unless these Terms or any other agreement related to the platform you are running specifies other means by which you must notify us. In addition to our services as a candidate, another facet of the investor protection we offer is the due diligence we perform on companies that buy from us. You can read more here: Due Diligence Charter. A nominee agreement is a very common structure in which the nominee holds the legal right to shares in favor of another person. This means that Seedrs is the legal shareholder in the shareholder register of the respective company, but we hold these shares on behalf of the various people who have invested in the company through Seedrs. The effect of this structure is that, although Seedrs owns the shares, all the economic interest in them – including the benefits of individual tax breaks such as SEIS and EIS – is passed on to the underlying investors. This agreement is very similar to a fiduciary relationship as well as the structures used by securities dealers and other types of intermediary platforms. Our candidate structure addresses this problem.
We eliminate the administrative burden by taking over all the technical work of shareholders while allowing investors to track and interact with their investments directly through the platform. Most importantly, by monitoring the company`s compliance with the underwriting agreement, we help protect the rights of its investors – so that if the company ever has a large exit, investors can take full advantage of it. 4.1. Unless we agree otherwise, if the Campaign is approved as described in paragraph 3.3, it will initially enter a «private launch phase» of up to two weeks, which means that during this period it will only be made available to certain Eligible Members who access the Platform via a specific link sent to you after the Campaign has been approved. After the private launch period, the campaign will be made available to eligible members on the platform. 4.1.1. An approved pre-emption promotion will only be made available to eligible members who are existing investors in the Company (and, in certain circumstances, other selected authorised investment members agreed between you and us) for at least seven days and will not be made generally available on the Platform. 4.1.2. Subject to an agreement between you and us, you may offer Eligible Members the opportunity to subscribe directly for shares of the Company instead of holding shares through us as nominees («Direct Investors»). All direct investors who pay for their investments through the Platform are subject to a minimum investment agreed between you and us. .