How to record a cancellation for a share grant

This article explains how you can cancel a share grant or cancel and convert to a different share class (i.e. deferred).

1. Log into Capdesk and enter the company page
2. Go to Share Grants which are noted on the left side under 'Equity Awards'.
3. Remain in the Grants section, to action a cancellation or to convert your shares, click on the action button (the 3 dots on the right side of the page). 

To issue a cancellation 

Start by clicking through to "register offline cancellation". You will then be presented with the screen as shown below. 

Here you have three options; 

1) Cancel grant by cancelling the shares

2) Cancel grant by converting share grants to another share class i.e. deferred

3) Cancel grant by transferring shares to another entity  

Other; 

4) Advance and Documents

1) Cancelling the shares 

By selecting this option, it means that you will cancel the shares so the grantholder no longer holds them and if applicable, it will return back to the incentive pool.

You will need to input:

- Cancellation reason: You will need to input a reason as to why you are cancelling these shares.

- Cancellation date: The date of when the share grants are cancelled

- Note: You will need to input a note explaining the cancellation e.g. the grantholder has left and decided to lapse all of his remaining grants.

(non-mandatary) "Money or Value Received " - Tick this box if the grantholder has received anything of direct monetary value or anything that can be converted into money or direct monetary value. 

You will also need to select either:

1. Cancel shares yet to vest: You can see in the description above this option that tells you how many are vested and yet to vest. In this example, 2,250 are yet to vest and will be cancelled.
2. Cancel all outstanding shares including any vested shares: This cancels the entire share grant.
3. Specify a number of shares to cancel: You can specify an amount that you would like to cancel.

You can also add any documents in the 'Documents' section relating to the cancellation. See Advance & Documents section at the end of this article for more information.

2) Converting shares to another share class 

By selecting this option, you are cancelling and converting the share grant to another share class (typically deferred shares).

You will need to input:

- Cancellation reason: You will need to input a reason as to why you are cancelling and converting these shares.

- Convert to share class: Select the share class that you want the share grant to convert to.

- Cancellation date: The date of when the share grants are cancelled.

- Registration date: This is the official date of entry into the shareholder register.

- Note: You will need to input a note explaining the cancellation e.g. the grantholder has left and the shares converted to deferred shares.

(non-mandatary) "Money or Value Received " - Tick this box if the grantholder has received anything of direct monetary value or anything that can be converted into money or direct monetary value. 

You will also need to select either:

1. Cancel shares yet to vest: You can see in the description above this option that tells you how many are vested and yet to vest. In this example, 2,250 are yet to vest and will be cancelled.
2. Cancel all outstanding shares including any vested shares: This cancels the entire share grant.
3. Specify a number of shares to cancel: You can specify an amount that you would like to cancel.

You can also add any documents in the 'Documents' section relating to the cancellation and conversion. See Advance & Documents section at the end of this article for more information.

Once your shares have been converted to a share class for example, "deferred share class", if you go back to the shares tab, you will be able to see the cancelled shares allocated in that class, as per below. 

3) Cancel grant by transferring shares to another entity 

By selecting this option, it means that you want to transfer the share grant to another stakeholder. The stakeholder we currently support are trusts and companies.

You will need to input:

- Cancellation reason: You will need to input a reason as to why you are cancelling and converting these shares.

- Currency: The currency of the allotted shares.

- Price per share: The amount to be paid per share for the transfer.

- Buyer: Select the buyer who will be purchasing these shares. We currently only support a buyer who is a trust or a company.

- Cancellation date: The date of when the share grants are cancelled.

- Registration date: This is the official date of entry into the shareholder register.

- Note: You will need to input a note explaining the transfer.

You can also add any documents in the 'Documents' section relating to the transfer. See Advance & Documents section at the end of this article for more information.

4) Advance and Documents

Advanced section includes:

Funding Round: The funding round of which the cancellation took place, if relevant

Priority Key: If multiple transactions happen on the same day, this field may be used to give an explicit priority when sorting

To Add Documents:

Three types of documents as noted below can be attached to the cancellation of the grant. 

If you are still unsure of how to cancel share grants, please contact us at support@capdesk.com and we'll be happy to help.