Corporate Matters

Working capital funding: Issues for investors to consider

In one of our previous blog posts, we referred to the prospect of joint venture partners being required to invest further capital in order to ensure the survival of a business.  In this post, we explore in more detail the issues to be considered before...

Future proofing businesses following covid-19

Notwithstanding any easing of the current lockdown over the coming weeks, social distancing measures are likely to be in force for many months, resulting in a radically different economic environment to which businesses will be required to adapt.  Most...

Earn outs in the time of Covid-19

Earn outs in the time of Covid-19 Coronavirus has already caused economic carnage in the UK and the after effects are inevitably going to raise problems for parties who have recently completed corporate transactions or are part way through negotiating a...

Enterprise Management Incentive ("EMI") schemes: Corporate considerations after Coronavirus

Not a blog about the “F” word “Furlough” – in such a short space of time it has become so much a part of our everyday vernacular. Looking to the future however, and the world “normalising” (whatever that might...

The future of lending in a post-coronavirus landscape

LENDING IN A POST-CORONAVIRUS LANDSCAPE The inability of borrowers to produce reliable forecasts, and of valuers to make site inspections, has led many funders to refuse all new loan applications while the current lockdown continues.  When...

Coronavirus: Implications for borrowers and lenders

The impact on turnover of the current lockdown, and the increasing prospect of a Coronavirus-induced recession, mean that it is only a matter of time before many businesses are likely to default on their loan facilities.  Lenders and borrowers alike...

Dissolution and Bona Vacantia post -14 October

The Bona Vacantia division of the Treasury Solicitor's Department recently caused confusion by amending its guidelines on the treatment of share capital distributed prior to a company's dissolution. The basic legal position is that any assets which...

Proposals for economic support of life sciences industry

The Government's announcement of a package of proposals for consultation, which are intended to boost the country's life sciences / pharmaceuticals industry, raises some interesting legal questions. Of most interest to many life science companies is...

Due diligence in a tough environment

In a harsh economy, purchasers are becoming even more cautious in their acquisition strategy. The due diligence review is therefore more important than ever. At the same time, however, purchasers are driving a hard bargain on fees, and it is often impossible...

Existence of a partnership

In the recent case of Christie Owen & Davies Plc v Raobgle Trust Corporation the Court of Appeal considered the question of when a partnership comes into existence. The Partnership Act 1890 defines a partnership as a "relation which subsists...

Earn-out mechanisms - useful guidance

It is increasingly common in this uncertain economic climate for a significant part of the purchase price for a target business to be subject to the post-completion performance of the business. Given that following completion the target will be under the...

Pre-pack administration rules

In an earlier blog we considered the government's proposals for imposing greater controls on so-called pre-pack sales, where the sale of an insolvent company's business and assets is agreed in principle before the company goes into administration,...

Authority of managing director

The High Court judgment in the case of Smith v Butler & Anor provides a useful illustration of the importance of ensuring that shareholders agreements and articles of association accurately reflect the intended balance of power between shareholders, and...

Changes to security registration regime

BIS has recently finished consulting on proposed regulations which will change the current regime for the registration of security created by UK companies and LLPs. Some of the key reforms include: the introduction of an electronic registration procedure,...

Protecting goodwill in a target business

In acquisitions of service businesses much of the value of the target will often be tied up with the key employees and the relationships generated by them. The consequences of losing any of these key employees post-completion could be disastrous...

Best endeavours

Parties commonly use language such as "best endeavours" or "reasonable endeavours" to assume a less than absolute obligation under a contract. It is difficult to provide definitive advice on how any such wording is likely to be...

True and fair view - FRC Paper

A recent paper produced by the Auditing Practices Board and the Accounting Standards Board of the Financial Reporting Council emphasises the importance of the requirement for a company's annual accounts to give a "true and fair view" of the...

Banking reform

12 September is the scheduled date of publication of the report by the Vickers Commission on bank reform. In a recent speech, the Chancellor appeared to put his weight behind the option of ringfencing the retail customer, mortgages and small business loans...

Threat to raise bank taxes

The latest development in relation to Project Merlin is the threat by the Business Secretary Vince Cable that if there is no evidence of the banks having made a significant effort to achieve the lending targets agreed with the Government, it will revisit its...

Merlin - first quarter update

It appears, unsurprisingly, that Project Merlin - the commitment to credit availability agreed earlier in the year between the Treasury and the four largest banks (HSBC, Lloyds TSB, Barclays and RBS) - has failed to meet its unofficial quarterly target for...
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