How to record an exercise for a warrant grant

Recording an exercise for warrant grants (payments and paperwork done away from Capdesk)

Find the warrant grant that you want to record an exercise for then click the corresponding action button (3 dots) -> Register Offline Exercise.

Screenshot 2020-10-28 at 15.57.15

You will then need to enter details of the exercise:

Screenshot 2020-10-28 at 16.02.28
  • Enter the date when the warrants exercised. When this date is entered, we will see how many warrants have vested and are yet to vest at this point in time.
  • Select the amount to exercise and you have 3 options:
    1. Exercise all of the warrants that have vested as of the exercise date (shown below the exercise date).
    2. Exercise all outstanding warrants (the total granted minus any warrants that have been deducted due to previous secondary transactions).
    3. Exercise a specific number of warrants (you can manually enter this value).

Screenshot 2020-10-28 at 16.06.34

Once completed how many warrants are exercised, we will see how much this will cost the grant holder. This is calculated by multiplying the exercise price by the exercised quantity.

The following details are not mandatory but the information can be recorded:
  • Registration Date - This is the official date of entry into the shareholder register.
  • Note - Any notes that you would like administrators and the warrant holder to view. 
  • Funding Round - The funding round of which the exercise took place, if relevant.
  • Employment Related - A security is employment related, when it is deemed that a person acquires it by reason of employment.
  • Priority Key - If multiple transactions happen on the same day, this field may be used to give an explicit priority when sorting, in order to avoid negative balances. The key must be an integer - positive or negative. Several transactions may share the same key. The transaction with the lowest (or highest negative) key will be viewed as coming first. No key corresponds to the value 0.
  • Documents - Adding a signed exercise agreement is recommended.
Once this information has been recorded, click Save Draft. You will be taken back to the grant and will see that the exercised quantity has been deducted from the previous outstanding quantity.


Screenshot 2020-10-28 at 16.14.16

Under Transactions, there are 2 drafts. By clicking on this, we will be able to find the transaction history of this grant.

Screenshot 2020-10-28 at 16.15.34

By clicking on the transaction, details of the exercise will be highlighted on the right-hand side.

Screenshot 2020-10-28 at 16.17.04


As with all exercises, this means that the warrant holder now owns equity in the business. Therefore the grant holder should now appear on the cap table. 

Screenshot 2021-01-27 - Exercised warrant

 

If you need further assistance, you can reach out to us by submitting a support ticket here.