The CFO asked whether and how the founders should complete and sign the assignment provision on the back of their share certificates. Please see Rewarding Key Personnel: Restricted Stock or Options?
A sample Stock Assignment Separate from Certificate is available, at no charge, on this blog’s Downloads page.
Seller hereby assigns 104,168 Shares to the Buyer, of which 13,587 Shares shall be subject to forfeiture by the Buyer to the extent the underwriters’ over-allotment option (as described in the Company’s registration statement on Form S-1, as amended (File Number 333-173930) (the “Registration Statement”), under the Securities Act of 1933, as amended (the “Act”), relating to an underwritten public offering by the Company (the “Offering”)) is not exercised in full.
In addition, a portion of the Shares held by each Buyer, in an amount equal to 25% of the Shares (the “Buyer Earnout Shares”), shall be subject to forfeiture by each Buyer as follows: (i) 50% of the Buyer Earnout Shares are subject to forfeiture in the event that the last sales price of the Company’s stock does not equal or exceed $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within 24 months following the closing of the Company’s initial business combination (as described in the Registration Statement) and (ii) 50% of the Buyer Earnout Shares are subject to forfeiture in the event that the last sales price of the Company’s stock does not equal or exceed $13.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period within 36 months following the closing of the Company’s initial business combination (as described in the Registration Statement).
The method of delivery of the original Letter of Transmittal, Transfer & Assignment of Shares Form, and all other required documents is at the option and risk of the tendering shareholder, and delivery will be deemed made only when actually received by the Depositary. Under no circumstances will interest be paid on the Offer Price for any reason, including any extension of the Offer or any delay in paying the Offer Price.
If any tendered Shares are not purchased for any reason (other than due to proration as described above), the Letter of Transmittal and the Transfer & Assignment of Shares Form with respect to such Shares not purchased will be of no force or effect.
Assignor acknowledges receipt of the Consideration. Assignor shall be responsible for paying any income taxes due on the Consideration. Assignee hereby accepts such assignment to it of the Assigned Shares subject to the terms, conditions, covenants, representations, warranties, indemnities and agreements set forth herein, and hereby acquires the Assigned Shares free and clear of all Liens. Assignor and Member, jointly and severally, make the following representations and warranties to the Assignee intending that the Assignee rely upon each of such representations and warranties to induce the Assignee to enter into and to complete the transactions contemplated by this Assignment, as follows: 5.1.1 The Assignor holds of record 377,000 shares of the Company Common Stock which constitutes all of the shares of the Company Capital Stock that either the Assignor or Member own in the Company, and such shares are fully paid and non-assessable.
The Assignor owns the Assigned Shares free and clear of any restrictions on transfer, Liens, encumbrances, security interests, options, warrants, purchase rights, contracts, commitments and/or other rights whatsoever.
The Buyers have paid to the Seller an aggregate amount of Three Hundred Twelve Dollars (2) (the “Purchase Price”), in consideration of the assignment of the Shares.
Notwithstanding the foregoing, in the event that the Company determines for any reason not to nominate, elect or appoint any Buyer as a member of the board of directors of the Company, or if any Buyer otherwise does not become a member of the board of directors of the Company for any reason, on or prior to the closing of the Public Offering, such Buyer shall automatically forfeit all of the Shares held by such Buyer, which shall automatically be assigned and returned to the Seller, and the Seller shall promptly return the Purchase Price to such Buyer. Seller hereby assigns and surrenders to the Company for cancellation 4,107 shares of Common Stock.