BGF Legal Review
Welcome to the BGF Legal Review. We are always keen to keep in contact with our lawyer network which has grown over the years. The BGF Legal Review is for lawyers that we work closely with and it is intended to give you information on changes to our processes, useful reminders and details of what we will be up to over the coming months – we hope you find this information useful. We look forward to working with you on our future transactions and to seeing many of you in person as we travel around the BGF offices. In the meantime, if you have any questions please contact any of the team who would be happy to help.
Funding growth with your support
Over the last nine years, BGF has invested a total of £2bn in nearly 300 companies. £503m of that has been invested in follow on funding with 74% of that investment made outside of London. We have also completed 55 exits including 5 spin-outs and in 2018 we became the first investment company to win a Queen’s Award for Enterprise in the Innovation category. Our lawyer network has been key to our success providing us with valuable legal support across a wide range of transactions, feedback on our terms, documents and process and access to training of which we are thankful.
BGF team changes
This month we are delighted to welcome Amy Osbourn to BGF. Amy has joined the Legal team as a Professional Support lawyer to focus on maintaining and sharing legal knowhow and maintaining BGF’s substantial bank of legal precedents. Amy will also provide some much-needed support to Jeni Cotterell in relation to NDAs and adviser engagement letters and in maintaining the Securities Database.
We also said a very fond farewell this month to Catherine Clarke who retired as General Counsel after 8 years in the role. For those of you who worked with us back at the start, you will know that when Catherine joined BGF she built the foundation of the BGF legal process from scratch, developing the standard legal documents and focused transaction approach which has helped enable BGF to become the most active growth investor in the world. We wish Catherine all the best for the future.
BGF structure and signing formalities
Some of the lawyers we work with have asked for a reminder of the changes to the BGF structure that took place in 2017/2018 and which BGF entity signs which documentation.
On 1 October 2017, Business Growth Fund plc (which has now been renamed Business Growth Fund Limited) ceased to be the general partner of BGF Investments LP (“BGF LP”). The new general partner, BGF GP Limited, delegated its rights to BGF Investment Management Limited (company number: 10608481) (“BGF IML”) which now acts as manager of BGF LP.
If BGF is making a follow on investment for the first time since October 2017, the legal documentation will need to deal with this change. The BGF supplemental investment agreement contains provisions to acknowledge the retirement of Business Growth Fund Limited as general partner and the appointment of BIML as manager of BGF LP. This is clearly signposted in the agreement and there are explanatory notes to assist. Aside from signing the BGF supplemental investment agreement or a deed of termination on an exit, Business Growth Fund Limited should not be a party to any agreement or legal documents (e.g. consent letters ).
During 2017/2018, any shares or loan notes that were held by Business Growth Fund Limited as general partner were transferred to BGF Nominees Limited. The transfer paperwork was dealt with in house by the BGF Legal Team. Where BGF is required to sign the paperwork as a shareholder or loan noteholder, the BGF signatory should be BGF Nominees Limited (“BGF Nominees”).
Further details are set out below:
Information on signing formalities can also be found in the BGF instruction document. If you have any queries at all please do give one of the team a call and we can assist.
BGF instruction and post-completion process
During 2019, we began looking at ways to streamline our instruction process to make it more efficient for BGF and our external lawyers. We have now adopted a new BGF Instruction and Engagement Document which will be issued on every type of BGF transaction.
This means we no longer need to issue different instruction letters for new investments, follow on investments, portfolio matters, exits etc. The BGF Instruction and Engagement Document contains all the usual information to assist lawyers working on BGF transactions however we have slightly changed the way we deal with post-completion matters. We will now be asking our external lawyers to send an email to a specific email address to confirm completion details and upload a bible to the BGF External Lawyer Site instead of sending the CD/USB bible via the post. We have trialled this on a number of deals and the feedback has been positive but if you do have any specific feedback on the document or if there is other information which you would find useful please get in touch.
For the time being, the BGF precedent documents will continue to be attached to the BGF instruction email sent by the BGF Legal Team however we are currently assessing whether a BGF external lawyer portal would be beneficial so that our lawyers have direct access to the latest versions of the BGF precedent documents.
In early 2020, we will be embarking on a legal review of our main equity precedent documents. The last review took place in 2015/2016 although we have made a number of small changes to our documents during the last few years following feedback from our lawyers and investee companies. If you have any comments to feedback, whether from a commercial or legal point of view, then do please let us know so it can be considered as part of this process.