Create preferred stock
When a company is issuing new securities, the securities are generated and accessible from the Shares section on your navigation sidebar. This includes securities such as Common Stock, Preferred Stock and Convertible Notes.
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Go to the Securities section in the navigation sidebar and select Shares.
You will see the details of the company's previous securities issuances.
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Select New stock issuance.
The new issuance wizard will open and ask you for the issuance data.
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Enter name of the securities being issued – in this case Series A Preferred.
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Select the calendar icon
and select the date of authorization.Note
A date in the past will be an actual issuance while a date in the future will automatically be considered a "what if" round.
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Select New Series from the Type dropdown menu.
This dropdown list includes the names of the securities that the company has previously issued. Select one of those if the financing you are currently working on involves a security of a class that has already been issued.
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Select Next to move to the Pricing Information for the new round.
Depending on the order you enter the information, Diligent Equity automatically calculates the values for the remaining fields, and will automatically complete the remaining fields for you.
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The next step of the wizard will let us enter Liquidation Preferences information. You are not required to enter this information now, when first creating the round of financing. You will need to complete this information in order to use the advanced liquidation analysis features that Diligent Equity offers.
Note
For information on setting up the liquidation preferences and preparing liquidation analyses, see Setting up liquidation preferences.
For this example we will leave the Set liquidation preferences box in Off mode. Select Next.
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Voting rights.
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The next step of the wizard will let us enter Anti dilution information. As with the liquidation preferences, you are not required to complete this information at this time, but you will need to before using Diligent Equity's liquidation analysis features.
Note
See Setting up anti-dilution provisions for steps on creating the anti-dilution provisions.
For this example we will leave the Set anti dilution in Off mode. Select Next.
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In the Authorized shares window enter the number of shares that are authorized to be issued. In our example, the Articles of Incorporation authorize 2,000,000 shares.
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Select Finish to create your new round of Preferred Stock.
After you have created the Preferred Round you can got to Settings to change, update, or add any additional details. After making any changes to the Round Settings, be sure to save a record of the cap table.
Note
If there will be more than one closing for the financing being created, check Enable different closing dates for different shareholders in the Settings under "More". When you check this box, you will see that "Date" fields appear below, in the Shareholders' allocations tables, that were not there before.
Next Steps: Review Issue, manage, and remove stock to allocate shares within your new round.
