Greetings, and welcome to the 2nd Elevate Legal newsletter.

We’re rapidly approaching the silly season when calendars seem to fill up of their own accord and every deal has to be closed by Christmas.

Need an extra hand before then; or planning ahead for projects in Q1 next year?  Give us a call.

In the meantime, here are some notes from the last few months.

If there are things you’d like us to cover in future editions please let us know at

Launching our new service

Get ready for your next capital raise, M&A deal or IPO – the low-stress way

We’re excited to be able to offer a new service to our clients, using a new online platform from leading dataroom provider Ansarada –

The tool helps companies prepare for an M&A or IPO due diligence process, while in the meantime giving management easy access to all your business critical information.

The platform is like an always-on dataroom.  It covers a whole range of topics, broken down into more than 100 specific requirements, to collate and manage all the important information about your business: the type of information that any potential investor (or acquirer) will want to see.

Each topic and requirement is assigned to one person, ensuring accountability and efficiency.  You can invite staff members or trusted advisors to access the platform, meaning everyone has a common source of key information.

An intuitive scorecard lets you see how ready you are – and which areas need the most work.

Then, on an ongoing basis, the platform is updated regularly, giving management, directors and other trusted stakeholders continuous access to all your critical information.

Elevate Legal has invested in an enterprise-wide account with Ansarada, through which we can set up and manage platforms for our clients to use on an ongoing basis.

Interested?  Please contact us for more information and an online demo.

What’s keeping us busy

Here’s a few of the projects we’ve worked on with our clients over the last few months. If you’re looking for similar solutions please let us know.

  • Helping some clients navigate through the Privacy Law requirements for mandatory reporting of data breaches. This issue will only get bigger.  We can help you create a data security procedure, so you have clear internal guidelines on how to respond to a data breach quickly and appropriately.  You don’t want to be making it up on the spot.
  • Helping early stage companies scale up by bringing on new co-founders, with new shareholder agreements, funding agreements, employment and consulting contracts, and intellectual property assignments.
  • Getting clients IPO-Ready (and Investor Ready) – using the Ansarada Material Information Platform (see below).
  • Capital raisings – preparing pitch materials and legal documents (term sheets, investor presentations, subscription agreements) – for investment rounds from new and existing investors.
  • Share swap transaction between an Australian unlisted public company and a private company with Chinese operations – involving several parcels of share issues, a share swap, and related option agreement.
  • Creating a ‘contract playbook’ for a client’s template customer contracts – identifying which clauses can be modified (and how) with low / medium / high risk rating – meaning a faster negotiating cycle and less need for external legal input.
  • (More) employee equity plans – getting the rules in place and making offers – including offer documents to comply with the ASIC Class Order for small scale offers.
  • Helping clients close out the annual reporting and meeting season – audited accounts and directors’ reports for FY18, then Annual General Meetings.
  • Creating and refreshing corporate governance materials including internal policies and procedures.
  • Managing our clients’ share registers – including staff equity – online at – a subscription-based service which replaces manual spreadsheets and paper share certificates.
  • Drafting and reviewing lots of commercial contracts…


Client spotlight

Each newsletter we’ll profile one of our clients doing amazing things.

In this edition, we profile Veritas Health Innovation – the developer of the Covidence software tool.

There is now so much research being produced no one can keep up, not even the experts. Over 4,000 research articles are published every day in health alone.

Too often, current practice does not reflect the latest research evidence, as the volume of research is simply too much for anyone to access in a timely and efficient manner.

Veritas is an Australian charity (with tax deductibility status) formed in 2014 to create a new way of knowing what works.  CEO Julian Elliott is one of Australia’s leading medical scientists, awarded the prestigious Commonwealth Health Minister’s Award for Excellence in Health and Medical Research.

Their Covidence tool is an online platform used by people around the world to accelerate the integration of the latest research into the evidence that informs current practice – benefiting our health, education and other aspects of wellbeing.

The Covidence user community is already the largest evidence network in the world, growing 80% in the last year to 55,000.  They have used Covidence for over 45,000 projects, cutting the time to produce high quality evidence by a total of over 2 million person-hours.

Covidence is funded by Australian philanthropy and subscription revenue from many of the world’s leading universities – including 10 of the top 25 US medical schools.  Covidence is building its team in Australia and the US to continue its growth in the academic market and explore opportunities to expand into the commercial market.

Elevate Legal is proud to be supporting Veritas with company secretary and legal support.  For more details please visit

Legal briefing

Crowd-sourced Funding now open for Proprietary Companies

Last year the Australian Government changed the law to allow public companies to raise capital through ‘crowd sourced funding’.  This allows companies to raise capital from a larger number of retail investors by offering shares without needing a full Prospectus (but still with some investor protections).

From 19 October 2018, this regime has been extended to eligible proprietary companies.  (The vast majority of companies in Australia are proprietary companies, with names ending in ‘Pty Ltd’.)

To be eligible for crowd sourced funding, proprietary companies must:

  • have at least two directors, the majority of which ordinarily reside in Australia;
  • have their principal place of business in Australia;
  • have less than $25 million in both gross assets and annual turnover; and
  • not have a substantial purpose of investing in securities or other companies.

Ongoing obligations for these companies who raise crowd sourced funding include:

  • prepare annual financial and director’s reports in accordance with the accounting standards;
  • having their financial reports audited if they raise $3 million or more from the crowd sourced funding offer; and
  • comply with existing related party transaction rules under the Corporations Act that up to now have only applied to public companies.

Crowd sourced funding can be a useful part of the funding mix, for the right business at the right time.  For instance, it’s most suitable for businesses with a passionate customer or supporter base, and perhaps less suitable for specialised B2B businesses with no retail presence.

An eligible company can raise up to $5 million in 12 months, and each retail investor can invest up to $10,000 per company in 12 months.

You can only raise capital through a licensed intermediary (e.g. OnMarket) and there are still some legal rules to follow.

If you’d like to know more please contact us.

For more detailed information, see the ASIC Media Release and ASIC Regulatory Guides.


More generous Equity Offers to Staff…Sometime

In November 2018 the Government announced that it would allow companies to make more generous equity offers to staff without needing a prospectus or other disclosure document.

Currently, an ASIC Class Order allows companies to offer shares to staff without a disclosure document, up to a value of $5,000 per person per year.  The announcement says the changes will increase this cap to $10,000, as well as reducing some of the disclosure and reporting requirements.

At this stage it’s just an announcement.  There will be a consultation process, draft legislation – oh, and probably a Federal election – before we see the changes become law.

In the meantime, if you’re looking for ways to issue equity to staff please contact us.


Directors’ ID Numbers Coming

An early warning that the Government plans to introduce Director Identification Numbers (DIN).  The policy was announced last year as part of a range of measures designed to crack down on phoenix company activity.

The policy would require all directors to confirm their identity. The DIN will be a unique identifier for each person who consents to act as a company director.

In October 2018 the Government released draft legislation to implement these (and other changes).  According to the draft Explanatory Memorandum:

The DIN will require all directors to confirm their identity and it will be a unique identifier for each person who consents to being a director. The person will keep that unique identifier even if their directorship with a particular company ceases. As such, the DIN will provide traceability of a director’s relationships across companies, enabling better tracking of directors of failed companies and will prevent the use of fictitious identities.

The proposed new law gives current directors 15 months to apply for a DIN from when the new law takes effect.

So look out for these changes coming in 2019.


Directors’ exposure to climate change risk

A few interesting developments in this area recently:

In September 2018, ASIC released a report on Climate risk disclosure by Australia’s listed companies.

In the introduction to the report, ASIC states clearly that:

Climate change is a foreseeable risk facing many listed companies in the Australian market in a range of different industries. Directors and officers of listed companies need to understand and continually reassess existing and emerging risks (including climate risk) that may affect the company’s business. This extends to both short-term and long-term risks.

The key findings from ASIC are:

  • 17% of listed companies in the ASIC sample identified climate risk as a material risk in their operating and financial reviews (OFRs).
  • General (as opposed to specific) risk disclosure is not useful for assessing climate risk exposures.
  • Fragmented climate risk disclosure practices make comparisons difficult.
  • The majority of the ASX 100 companies in the ASIC sample had, to some extent, considered climate risk to the company’s business. There is limited climate-risk-related disclosure outside of the ASX 200.
  • A number of listed companies in the ASIC sample intend to adopt the recommendations (either in full or in part) of the Task Force on Climate-related Financial Disclosures (TCFD).

ASIC then makes the following key recommendations for listed companies:

  • Consider climate risk: Directors and officers of listed companies should adopt a probative and proactive approach to emerging risks, including climate risk.
  • Develop and maintain strong and effective corporate governance: Strong and effective corporate governance helps in identifying, assessing and managing material risks.
  • Comply with the law: The Corporations Act already requires disclosure of material business risks affecting future prospects in an operating and financial review (part of the Annual Report) – which may include climate change.
  • Disclose useful information to investors: Specific disclosure is more useful than general disclosure. The voluntary framework developed by the TCFD may help listed companies in considering how to disclose material climate risks and what type of information to disclose.

It’s clear – if it wasn’t already before this report – that directors of listed companies should be proactively assessing, managing and disclosing climate risk where it’s material to their business.

Another Australian Government regulator, APRA, has emphasised climate change risks as an area of focus for its regulation of the financial industry. In particular, APRA has recognised that climate change poses financially material and foreseeable risks to Australian businesses and that APRA intends to closely monitor how APRA-regulated entities consider and plan for climate-related risks.


Geoff Summerhayes (Executive Board Member, APRA), ‘Australia’s new horizon: Climate change challenges and prudential risk’ (Speech delivered at the Insurance Council of Australia Annual Forum, Sydney, 17 February 2017) –

Geoff Summerhayes (Executive Board Member, APRA), ‘The weight of money: A business case for climate risk resilience’ (Speech delivered at the Centre for Policy Development, Sydney, 29 November 2017)- 

If directors don’t address material climate risks, they could be liable for breaching their duty to act with care and diligence.

It is only a matter of time before we see a rise in litigation against directors for failure to take reasonable steps in relation to foreseeable climate-related risk.

This theme has been played out in several shareholder lawsuits.

In 2017 two shareholders sued the Commonwealth Bank of Australia (CBA), claiming that CBA’s 2016 Annual Report failed to properly disclose the risks that climate change posed to CBA’s financial position and performance.  After the lawsuit was filed, CBA released its 2017 Annual Report – where it acknowledged that climate change posed a significant risk to the bank’s operations – and published its first climate policy position statement.  The shareholders then dropped the lawsuit (presumably having made their point).

Then, in July 2018, a superannuation fund member sued his super fund, Retail Employees Superannuation Fund Pty Ltd (REST) to require REST to provide him with information on how the fund is managing the risks of climate change.  (He had earlier written to REST asking them how the fund was managing the risks involved in investing in companies that either contribute to or are at risk of climate change, including fossil fuel companies – and REST refused to provide details.)

The trustees of the super fund have a basic legal duty to act in the best interests of present and future beneficiaries of the fund – so any decision could have far-reaching implications for Australia’s other superannuation funds.

The case is winding its way through the early stages in the Federal Court and, no doubt will take some time to come out the other end.

Watch this space…

Elevate News

In the September holidays, Andrew and his family travelled to Spain and France, with an unexpected highlight being a small town Course Camarguaise tournament.  It’s called French bullfighting, but they don’t really fight the bull…it’s more like playing tiggy with a bull. Unlike Spanish bull fighting, here the blokes in the ring are unarmed and the bull is not hurt – in fact the bull is the star of the show.  It’s hard to explain but great fun to watch.  Check out some videos here and here.  New season starts March 2019!

The Podcast that started it all, Serial, is back with a new season.  This time, instead of investigating just one real-life crime or mystery, the team spent a whole year embedded in a typical American courthouse – in Cleveland, Ohio – telling ‘the extraordinary stories of ordinary cases’.  It’s a captivating and unsettling journey into the American justice system.  Listen and be glad you’re not living there.

To all our clients and supporters – thank you for the opportunity to work together this year.  Best wishes for the summer holiday season and for 2019!