An individual who was originally a private equity investor and who exercised an option over shares after subsequently becoming a director of the company was deemed to have acquired the option by reason of his employment.
Background
The business of the taxpayer company was incorporated in 2003 as VSL Ltd. In 2006, an equity fundraising exercise took place. Another company (VHL) was incorporated, into which new investments raised in 2006 (and 2007) were made. A share-for-share exchange took place as part of the 2006 funding exercise to superimpose VHL as the holding company of VSL.
The shareholders after the financing exercise in 2006 comprised: (1) shareholder directors; (2) private equity investors; and (3) consortium investors. One of the private equity investors (MN) was a ‘corporate advisory M&A and technology business specialist’.
A corporate advisory and consulting business (Q)