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A specialist corporate law service for solicitors and accountants

A few examples of how we have helped companies solve their problems.

For reasons of confidentiality, names are withheld.

PRE-EMPTION PROVISIONS CAN BE DYNAMITE
Joint Venture Agreements

David’s and Steve’s Company had embarked upon a growth strategy by entering into joint venture arrangements.  The first two joint venture agreements contained pre-emption provisions.  These required a joint venture partner company, the control of which was about to change, to offer their interest in the joint venture to the other joint venture partner.

We were invited to advise on the negotiation and drafting of further agreements.  We removed all pre-emption provisions and consistently refused to accept any suggestion that they be included in future agreements.

Why?  David’s and Steve’s Company would have been very difficult to sell in the future, if a major part of its business activities was subject to pre-emption on a change of control.  The standard practice of including pre-emption rights was not in this client’s best interests.

And the outcome?  When David’s and Steve’s Company was eventually sold, the first two joint venture agreements caused difficulty but the majority of joint venture interests remained intact.  Their Company was marketed and sold very profitably.

 

CONTINUITY OF SUPPORT
Restructuring and Help to Overseas advisers

At the request of their Solicitors, we were asked to help aspiring internet entrepreneurs and their investors to set up a company in the UK which would mirror their existing Australian company’s structure.  We incorporated the English associate company, documented the initial shareholder arrangements and a subsequent reconstruction, provided a registered office and Company Secretarial services and, eventually, assisted the Group’s Australian legal advisers in the sale of the Group.

 

FAMILY MATTERS
Implementing Corporate arrangements in Divorce proceedings

When a principal shareholder of a successful family Company became involved in divorce proceedings, the estranged spouse was entitled to a portion of the value of that principal shareholder’s shares.  There was insufficient cash available to make an immediate, full settlement to the estranged spouse.  The Company’s Accountant devised a complex scheme of dividend payments, loan assignments and loan notes, all of which had to be swiftly documented and agreed by the parties in the divorce proceedings, so as to meet the Court’s timetable.  We liaised with the Company’s Accountant and the shareholders’ Divorce lawyers, in order to provide all of the necessary company documentation.

...and one problem with no easy solution

A CAUTIONARY TALE
Property Management Companies

Geoff bought the lease of a London flat for £1 million.  The flat was in a block of three.  Many years before, the freehold of the block had been bought by a company set up, owned and controlled by the leaseholders.  Funds for the purchase had been provided, equally, by previous owners of the leases of the three flats.  The leases of the other flats had been extended to 999 year leases but Geoff’s, newly acquired, flat was held on a lease with only 80 years remaining on it.  Geoff thought that he would be entitled to a share in the management company and a seat on its Board.  He also assumed that the other shareholder/directors would allow an extension of his lease without hesitation.  The other two leaseholders comprised the majority at Shareholders and Board meetings of the Company.  They refused to allow Geoff to participate in the Company and they refused to agree to the extension of the lease of his flat.

In this instance, we could not propose an easy solution for Geoff.

Companies formed to own and/or manage the freehold of residential properties ought to have appropriate Articles of Association which allow each property owner an appropriate involvement in the Company’s affairs.  When leaseholders make arrangements to buy out a freehold, they should not assume that a share in the company will automatically guarantee a lease extension.

 

 

 

 

Reddings Corporate Law Limited, Reddings, Oakridge Lane, Sidcot, Winscombe, North Somerset BS25 1LZ
Registered in England and Wales No 6910550

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