· Change Board Members Workflow

Introduction

The Change Board Members workflow will allow you to initiate or record changes to your Board of Directors, whether to document a change that happened in the past, or to make changes to your current board. The successful completion of this workflow will involve approval from your Board, and Stockholders (if applicable).

You will need to have the Governance Workflow Access permissions in order to run this workflow.

Running the Workflow

Let's Get Started

This workflow can be found in the Governance section of the Available Company Workflows page. Select if you want to change the board and generate and solicit the necessary approvals or to document a prior change to the board.

Update Board Structure

Here you can make the necessary changes to your board. Click Add Board Seat to add a new board member or to add an empty seat. Click the Edit icon to change a current seat. Click the X to remove a board seat.

List Termination Type

For departing board members, if they resigned from the board, you can upload their letter of resignation. Click Need info to add details of their departure.

Select Method of Approval

Indicate how you would like to obtain your Board and Stockholder approvals. You can obtain approvals in the following ways:

• Have the system create the Board/Stockholder consents right now as part of the workflow.
• Use your drafted document to request approval. Using your consent draft, the system will attach a signature page to it and circulate it for signature. You will have the opportunity to specify if there are resolutions included in this draft that are currently blocking other workflows. Doing so will release those workflows as well upon receiving approval.
• Approve in a separate workflow. Selecting this option will prevent you from completing this workflow until approval is captured. This option allows you to bundle resolutions from this and other workflows or custom resolutions your attorney may need to include all at once. The resolutions needed for this workflow will be queued the next time you run a new Board Consent, Board Meeting Minutes or Stockholder Consent workflow.
• If this approval has already occurred, you will be able to upload a previously signed document to approve this action or select one already in your data room.

You have the option to waive Stockholder approval if your company does not require it. If you are uploading an approval, you will be asked to provide the document on the next page.

Checkpoint

The checkpoint page will give you a chance to review the documents involved and make any edits needed. Each document on this page will have a PDF document that should be downloaded and reviewed. Your company may require this workflow to be reviewed and released by legal counsel. If legal review is not required, you will have the option of requesting your legal counsel review the documents. You can also select if you want someone besides your legal counsel to review your documents.

Wait for Approvals

Approval from the Board of Directors and Stockholders (unless you’ve waived the stockholder consent) is required for this workflow. If you chose to create the Board/Stockholder consents in the system or upload an existing draft as part of this workflow, then your Board Members/Stockholders will be asked to review and sign their respective consents. Once you proceed past the checkpoint, the workflow will begin collecting the signatures from the board.

FAQs

What if I don't have all the required information for this workflow?

If you have started the workflow and need to gather additional information, you have two options for continuing. The system will save your progress in the workflow if you need to finish the workflow at a later time. To reopen the partially completed workflow, click on the workflow name from the company workspace. You can also use the Discard button to end the workflow and start from scratch once you have the necessary information.

What is the difference between board seats and board members?

The system allows you to change the number of board seats, as well as change the number of board members filling those seats. These are two separate concepts. You may change both, or just one.

As an example, you might increase your board from two seats (with two founders filling the seats), to three seats as part of a new round of financing.

If you have questions about how many seats or people should fill your board, you might consider speaking with your lawyer.

What if my Board Member resigned?

When you remove a board member during this workflow, it will prompt you to enter the termination type and then provide their resignation letter if applicable. If you’re not sure if your board member resigned, please consult your lawyer.

If you indicate in the platform that your board member resigned, you’ll be asked to provide the board member’s letter of resignation. You can also defer the letter of resignation if you don't have it handy.

Please note: If you say a board member didn't resign, their signature will also be required as a part of this workflow. Conversely, a board member who resigned will not be asked to sign off on updates or changes to the board of directors.

Additional Resources

Governance

Board Consent vs. Shareholder Consent

---

Screenshots are for illustrative purposes only.

Fidelity Private Shares LLC provides cap table management and other administrative services to private companies and their equity compensation plans.
Fidelity Private Shares LLC

© 2024 FMR LLC. All rights reserved.

1092915.1.0