Warranty. You may require warranties with respect to the

business's assets, the order book, debtors and creditors,

employees, legal claims and the business's audited accounts.

A commitment from the seller to reimburse you in full in

Certain situations is known as an indemnity. You might seek

Indemnities for unreported tax liabilities. Here again, our firm

Can assist you in reviewing the content and adequacy of

Warranties and indemnities.

Listening 2

~

Jack: Rob, do you think you could spare a minute and help me

out with something?

Rob: Sure, what is it?

Jack: Well, I'm working on the Longfellow case - you know, the

company that's planning to increase its share capital.

Rob: Right. What do you want to know?

Jack: I have to admit that this is the first time I've done this

Kind of thing. There certainly are a lot of steps that have to

be followed, and I don't want to forget anything.

Rob: I understand. But it's really pretty straightforward, you'll

See. Let me show you what we usually use when we take

care of any kind of changes in company structure. We've

Got these checklists, you see, that tell you what has to be

Done and in what order. It also tells you what regulations to

Refer to in different cases, and what documents need to be

Filed, for example. Have a look.

Jack: Looks good - I think this would help.

Rob: I'm sure it will. Let me talk you through it ...

Jack: Great.

Rob: Well, the first thing you have to do is check the

Memorandum of association, to find out how much the

company's share capital is.

Jack: OK.

Rob: Then you have to find out whether they've issued all their

Share capital already or not. The next step would be to

Determine the amount of increase of share capital.

Jack: Ah, I know that already.

Rob: Good. Tell. your client that they have to call a board

Meeting, but at reasonable notice. And a quorum of

Directors has to be present.

Jack: A quorum?

Rob: That's the minimum number of members required so that

Business can be carried out.

Jack: Ah-hah.

Rob: At this meeting, the directors have to pass a resolution

that they'll hold an EGM where they will vote on the

Increase of share capital.

Jack: An EGM is the extraordinary general meeting, right?

Rob: Right. But before the EGM can take place, the

Shareholders have to be informed by notice about the EGM.

This notice must state the following things - you see them

listed here on the checklist: date, time, place, proxy,

Ordinary resolution, consent to short notice.

Jack: What does 'consent to short notice' mean?

Rob: That just means that they agree to the meeting being

Held soon, without everyone knowing about it a long time in

Advance.

Jack: I see. And now what?

Rob: Well, the chairperson is required to preside at the EGM,

and it's necessary that a quorum is present. Then the

resolution has to be passed by a simple majority. That's all.

Jack: What about the paperwork that has to be done?

Rob: Right. Well, minutes of the two meetings - the board

Meeting and the EGM - have to be drawn up. Finally, within

Days, the following documents have to be filed at

Companies House: the ordinary resolution, the notice of

Date: 2015-12-11; view: 1086