BharatPe cofounder Ashneer Grover: Stock options equal to about 1.4 per cent shareholding of BharatPe co-founder Ashneer Grover can be forfeited. A person with knowledge of the development said that action can be taken against Ashneer Grover if the PwC’s inquiry report tabled in the board meeting on Tuesday finds evidence of wrongdoing. This has come to the fore in a report by Livemint.
According to the Articles of Association (AoA) of the fintech company, 75 per cent of the shares allotted to them were restricted after the Series C funding in September 2019. These shares were to be handed over on pro-rata basis on completion of 3 years period ending in September.
There is a time limit for handing over the restricted stock units.
Restricted stock units are given to the employees and have a fixed time frame of assignment and can be transferred or sold only after the employee has been with the company for a certain period of time. Grover on Tuesday resigned as the managing director of BharatPe. A source said that Grover’s restricted shares are to be handed over between March and September. On Tuesday, Grover told Moneycontrol that he holds 8.5 per cent stake in BharatPe.
Before Ashneer Grover, the founders of these companies also had a long dispute with the board, know about them
Decision will be taken on the basis of Shareholders Agreement
Considering Grover’s founder-shareholder status, transfer of shares and whether or not to take legal action by the board against him will be decided on the basis of the shareholders’ agreement.
“If the PwC report indicates some wrongdoing by him, Grover may lose 1.4 per cent of his equity,” the source said. BharatPe’s board considered the PwC report late on Tuesday and the company is yet to comment on the issue.
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Despite the resignation, the board is capable of taking action
However, BharatPe’s AoA mentions that the board can expel a co-founder if it finds a “reason” only after a probe is conducted by one of the four big accountancy companies. The board of BharatPe had appointed PwC last month to probe several lapses in corporate governance in the company.
Despite Grover’s resignation on February 28, the board is able to take legal action based on the PwC report.
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