Pathway Map
ACADEMIC FOUNDERS
Deal close overview.
As founders approach the point of finalising the overall investment deal, it is crucial to carefully engage with all stakeholder groups to ensure that every prerequisite has been satisfied.
Avoiding last-minute delays is essential for the successful launch of the spin-out. Founders should work closely with the company’s legal advisers to coordinate the required documentation and meetings (such as passing resolutions) for completion.
Founders must also understand the correct sequence in which documents must be signed and actions taken to ensure a smooth and efficient closing process.
Licence and/or corporate bible execution and completion
Once both sets of documents (i) the licence and (ii) the corporate documentation are nearing final versions, and the investor(s) have confirmed their intention to proceed, all parties should agree on a date and time for a completion board meeting. At this meeting, the existing board will formally authorise all elements of the deal and oversee the final completion actions.
The company’s legal advisers should provide all parties with:
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a list of any remaining pre-conditions
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a detailed completion checklist setting out all actions to be taken, the documents to be signed, and who is responsible for each signature and approval.
Founders and their advisers must ensure everything is fully prepared before the meeting.
Although completion meetings were traditionally held in person, recent practice supports virtual board meetings and electronic signing of documents. The company’s legal advisers should guide the founders and other parties through the completion protocol, ensuring that documents are signed in the correct order and all necessary steps are completed.
Investment funds will be transferred according to standard banking timelines. In some cases for example, where EIS or SEIS funding is involved, there may be separate completion stages over the following 24–48 hours, following the sequence outlined in the subscription agreement.
Company/founder approval
Once all the documentation has reached final form stage following all negotiations, it is expected that the founders do still want to complete the spin-out deal and should confirm this to all other parties.
Invested and licensed spin-out company
Once deal completion has taken place, then some key steps or tasks may still be required to ensure all arrangements are meticulously finalised, such as:
| Activity: | Who Responsible: |
|---|---|
| • Issue of relevant share certificates to new shareholders, update share register, Companies House filings, | Company |
| • If founders are moving (full time or part-time) into the spin-out, ensure university employment contracts are appropriately amended | Founder/ University line management/ HR |
| • If any founders remain within the university, then formal Conflicts of Interest will be evaluated and a Conflicts of Interest (COI) Management Plan put in place | TTO (lead advisory) – founder/ University line management |
