While the future of the ARI program hangs in the balance, Iberis Capital is not wasting any time protecting their interests.
Iberis is quietly, without any warning or discussion, extending the lock-in of the venture capital fund effectively holding the participants’ funds for twice the amount of time required to qualify for a GV.
If the GV program is canceled or future renewals are affected, then everyone will want their money back and that would be awfully inconvenient for them.
On 28 March the Avogado for the fund/Iberis sent out a convening notice for the Iberis Greytech fund Annual General Meeting (AGM) and deep in the fine print (on page 14) is a proposed change to the fund duration extending it by two years. Nowhere else in the Annual Report, the Auditor’s report, in the covering email or anywhere else has Iberis bothered to explain what they are doing and why.
If you are a participant and received the fund documents, ask yourself: before reading this post did you know about the proposed two-year forced extension? They are doing it quietly because the Limited Partnership Agreement (LPA) is in their favor – this is not a problem; we knew that when we signed. Only the Management Company (Iberis) can propose any changes and these are adopted by 2/3rd of the votes cast.
But please note: the meeting takes decisions regardless of the number of unit-holders present or represented and the capital they represent. The resolutions of the meeting of unit-holders are binding on the holders of units who did not attend the meeting, as well as those who abstained or voted against. So if people do not vote against the resolution (which is what they are counting on), then even one unopposed FOR vote will pass it and make it binding on the entire fund and every participant.
The LPA already allows for 2 x 2yr extensions to the fund but these are optional and they are leaving those unchanged. Instead they are making a compulsory extension. They could have left everything unchanged, made 25% per year return each year and then suggested to the participants to exercise an optional extension but they don’t want to take that risk.
Iberis are duty bound to treat all participants justly and fairly and also to make all decisions in the exclusive interest of the participants. They are clearly not doing so here. I am sure CMVM would agree with me. I expect Iberis will take a dim view of this post and try and explain otherwise while saying they are complying with the law / LPA etc. You can make up your own mind. They are using the system to their advantage in an opaque, underhanded and predatory manner.
The good news is that it’s not too late. If you want to stop Iberis, here’s how:
If you are a participant in Greytech II and you do not want the forced two-year extension to go ahead then either:
a) Complete your ‘Declaration of Vote’ and email it to them by 1pm (Lisbon time) on 14 April. OR
b) Attend the meeting on 18 April (by video conference or in person) and vote AGAINST Item #4 on the agenda. OR
c) Have your proxy attend the meeting and vote AGAINST item 4 on the agenda.
Instructions for each of these options are laid out in the email with the Convening Notice which you should have received on 28 March from Bernardo Abreu Mota | CS’Associados.