'We don’t really know what we want - but we want it cheap’ . . .
(and we’re ‘sheltering’ behind an intermediary - so that we are not in direct contact with you - and you don't know who we are – so you can’t explore with us how you could cost-effectively meet our needs) = Frustrating!
But if they leave me ‘blind’ as to who the heck they are - then it’s bound to result in ‘the blind (being unable to) lead the blind’!
They make the fundamental mistake and inviting themselves to be the person who is 'Sold To'.
They should be the person who is making a 'Buying Decision'.
Pick up the phone (for 'Heck's Sake')!
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Based Cellular / e-Telephone
www.EquitableLaw.com
Feel free to seek to schedule a conversation with me = https://calendly.com/danielrobertjohnson
Thursday 22 November 2018
Wednesday 21 November 2018
I've Got a Business Law Issue - How Do I Approach a Solicitor?
if you have a legal issue relating to your business - then you really should consider (potentially) using the services of a highly experienced, expert, fully qualified and legally trading 'English Solicitor' (i.e. an authorised and regulated U.K. lawyer) - specialising in company / corporate, finance and commercial matters (such as me) - as opposed to the numerous laymen - and much, much worse! - who habitually provide all sorts of dubious guidance to people in business.
This is doubly so - If you are dealing with relatively material matters (as regards your ongoing business' trading arrangements - and/or - your time & effort).
Don't ignore it - Deal with it!
I'd strongly suggest that you do speak with a Solicitor- so as to ensure that you receive the best possible legal advice and assistance in terms of dealing with your current position and/or future proposals - in an appropriately practical and cost-effective manner (and most importantly - in a manner that you can rely upon in the future).
If you don't (or aren't able) to take appropriate legal advice and assistance (now) in relation to the circumstances you are dealing with - you potentially face 'making a false economy' - as I fear you may well spend time, effort (and money) in a manner which is 'sub-optimal' - both in terms of the initial effects of any advice and assistance you might receive (and the relevant advice and assistance's ongoing legal effectiveness - i.e. it's 'worth' in practical use over time).
I would always suggest (if you wish to approach me) that we arrange to have an initial 'no-obligation' exploratory consultation (remotely / by telephony) - aiming to concisely discuss (in sufficient detail) the underlying situation you are seeking to address - and - to outline the approaches/options available for you - thereby (hopefully) formulating an appropriate course of action for you to take.
If you wished to proceed upon that basis - it would be extremely helpful for me - if you were able to provide me (before we might 'talk' - and - in accordance with my professional obligations of strict confidentiality) with such further background information as might be appropriate for me to know (e.g. identity of the interested parties) and/or sight of any relevant copy documentation (e.g. any relevant 'papers') so as to assist my initial review.
Once we might have spoken - I should be able to agree to limit my firm's fees - to very reasonable budgeted sum(s) (as would objectively be considered appropriate - on a 'what the legal advice and assistance is worth basis' - i.e. 'Quantum Meruit') - while working quickly and efficiently so as to ensure maximum cost-effectiveness.
I believe you will find this approach highly valuable and the best way of preparing to address the situation you need to deal with.
If the above makes sense to you - I hope that you will make direct contact with me in the near future - so that we can advance matters.
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Based Cellular / e-Telephone
http://www.EquitableLaw.com
Please feel free to schedule any proposed conversation with me via:- https://calendly.com/danielrobertjohnson
Tuesday 20 November 2018
Most Outstanding Business Legal Advisory Firm 2019 - London
Most Outstanding Business Legal Advisory Firm 2019 - London
A.I.'s 2019 Global Excellence recipients are handpicked by AI magazine - based upon a comprehensive analysis and research undertaken by the wider group within the U.K. Corporate finance advisory community.
This proven approach ensures that A.I. selects its candidates purely on merit – not size nor marketing budget – and recognise the very best in business. Whether you run a single office firm or a multinational corporation, A.I. Magazine rewards those that are succeeding in their endeavours, innovating, growing and improving.
Proudly not 'pay-to-play' (unlike all of the legal directories - to which larger firms proudly announce their inclusion every year - 'after their cheques clear'!).
A.I. Magazine has invited us to share our success with this announcement.
For more information, please do not hesitate to contact:-
Mr. Dan.Johnson@EquitableLaw.com - Principal & Business Law Solicitor
+44 (0) 7788 537 187 = U.K. Cellular / e-Telephone
www.EquitableLaw.com
Tuesday, 20th November 2018
Thursday 15 November 2018
Enterprise Management Share Option Schemes (E.M.I.s) . . .
Businesses / companies often approach this Solicitors practice - seeking to discuss share option schemes (and in particular EMIs).
If this includes you - Do please ask us for 'appropriate' reading materials for your purposes - Such as the annexed (extract).
EMI Share Option Schemes are a very powerful workforce incentivisation tool - but they do have to be implemented (and run), both with careful thought and skilfully prepared documentation.
There are a huge number of (largely) unqualified, inexperienced and inexpert laymen selling such schemes to relatively early stage / fast growing businesses (who seek to be 'low cost' in the way that such arrangements are introduced).
Be warned that 'low cost' and 'cost-effective' are not the same things = I (and many of my contemporaries) - see huge problems at a later stage in a business' / company's development (i.e upon exercise of the relevant options - whether on sale or otherwise) - costing tens of thousands of pounds in professional fees to correct (if they can be corrected at all) - at which point the 'cowboys' who were historically involved - have long spent their fee for setting up the deficient scheme (and only at that long subsequent point of discovering the deficiencies - does the relevant business / company realise they have no redress = they only then understand that they historically dealt with an unauthorised, unregulated, and in reality - uninsured business who cannot and will not help put right their mistakes).
The maxim (accordingly) is do / always 'Use A Solicitor' - But don't underestimate the upfront (and ongoing) external costs and management time and effort in establishing and running an EMI scheme (properly)!
I look forward to hopefully 'talking' soon.
With best regards
Dan Johnson - Principal & Business Law Solicitor
www.EquitableLaw.com - Solicitors
+44 (0) 7788 537 187 : U.K. Cell. / e-Tel.
+44 (0) 20 8780 3319 : London Landline
Wednesday 10 October 2018
No Deal #Brexit : The Unpalatable Consequences . . . .
One of the extraordinary effects of #VoteLeave upon the #British populace - Is that complete laymen (as far as any legal training, experience or expertise) seem able to lecture qualified U.K. lawyers (Barristers and Solicitors - The latter like me!) what U.K./E.U. #law is.
Regrettably, most of those layman's understanding (misled by ridiculous politicians - and - others with a hard Brexit agenda - who are prepared to lie to achieve their aim) is what we lawyers call 'TOTALLY WRONG' (Apologies - There are a lot of concise 'Latin phrases' used in my profession but really something altogether more 'Anglo-Saxon' is what is really required to describe the deluded understanding of some people).
To assist any of my readers with understanding the U.K.'s most significant national negotiations in (at least) my lifetime - I'm not too proud to provide the 'work of another' - Setting out in clear, comprehensive but concise terms the unpalatable choices which the British Government is currently grappling with.
https://documentcloud.adobe.com/link/track?uri=urn%3Aaaid%3Ascds%3AUS%3Afaecdb8f-eee5-4a3b-8156-a1e57bd305d6
https://www.linkedin.com/pulse/no-deal-brexit-unpalatable-consequences-dan-johnson/
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e.-Telephone
www.EquitableLaw.com
Regrettably, most of those layman's understanding (misled by ridiculous politicians - and - others with a hard Brexit agenda - who are prepared to lie to achieve their aim) is what we lawyers call 'TOTALLY WRONG' (Apologies - There are a lot of concise 'Latin phrases' used in my profession but really something altogether more 'Anglo-Saxon' is what is really required to describe the deluded understanding of some people).
To assist any of my readers with understanding the U.K.'s most significant national negotiations in (at least) my lifetime - I'm not too proud to provide the 'work of another' - Setting out in clear, comprehensive but concise terms the unpalatable choices which the British Government is currently grappling with.
https://documentcloud.adobe.com/link/track?uri=urn%3Aaaid%3Ascds%3AUS%3Afaecdb8f-eee5-4a3b-8156-a1e57bd305d6
https://www.linkedin.com/pulse/no-deal-brexit-unpalatable-consequences-dan-johnson/
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e.-Telephone
www.EquitableLaw.com
Wednesday 3 October 2018
‘SHAREHOLDERS AGREEMENTS’ : DON’T FALL FOR THE CON!
‘The Sting’ – Don’t Be Sold What You Already Have!
I wanted to take this opportunity ‘to get off my chest’ a set of circumstances that really annoy me – and which this ‘grumpy old Solicitor’ (specialising in British company / corporate matters) sees repeatedly in the marketplace. I hate seeing people fall for a con!
My ‘gripe’ is that there is a surprisingly large business advisory industry in the U.K. that seeks to actively market the sale of ‘Shareholders Agreements’ to early-stage ventures and diverse owner/managed businesses – being effectively, quasi-partnerships of entrepreneur individuals, coming together to found and/or develop businesses within the shell of a limited liability company.
At best, these ‘business advisors’ are inexperienced and/or inexpert – but many of them are completely unqualified, unauthorised, unregulated (and in reality – incapable of providing any redress) laymen as regards British company law – and their skill sets are more focussed upon 21st century web-advertising (and the like).
The strange aspect of legal agreement preparation is that unlike (say software – with which legal drafting otherwise has many similarities), a relative layman has difficulty in knowing ‘whether it works or not’ at the point ‘they pay their money’.
The ‘proof of the pudding’ is (often) in the eating – when one or other interested party wishes to enforce what they believe is a legal (and practically useful) document, often sometime in the future and that is often when one wishes they were not subject to the adage ‘you get what you pay for’.
Call me old fashioned, but when I’m feeling unwell – I would generally opt to discuss matters with a doctor or a pharmacist – whom I had some comfort are medically trained, experienced and relatively expert in their field (being authorised, regulated and insured). I don’t tend to take steps in relation to my health on the basis of a ‘health advisor’ who was trying to sell me a ‘magic potion’ over the internet!
Endlessly, the shysters in my legal sector will seek to tell the early stage venturers or diverse owner/ managers – “You absolutely MUST have a shareholders agreement” (which I would advise you to read as – “We have a ‘Word’ document of dubious provenance and extremely doubtful legal effect – which with our limited word processing skills we can make minimal amendments to – e.g. add your individual names and your relevant company name at the appropriate place where 'blanks' appear in the template we have – and then charge you (only) several hundred pounds for the privilege).
By the time that ‘shareholders agreement’ is actually considered by a legally qualified, authorised, regulated (and insured) Solicitor – attempting to deal with the ‘real world issues’ which have arisen under it – This Solicitor all too often has to inform the individuals involved that they have bought little more than ‘poor quality toilet paper’, which needs to be completely disregarded (in terms of seeking to help those who paid for it), and that regrettably – they don’t (in practice) have any realistic redress against those who sold them this garbage.
‘The Legal Reality’ – You ALREADY have a ‘Shareholders Agreement’
The first fact that those who have any involvement with a British limited liability company need to realise - is that I can guarantee (with 100% certainty) that they ALREADY effectively have a ‘shareholders agreement’ from the day that they formed their company (and that ‘perhaps’ the fact that this wasn’t discussed with them - when they bought ‘another shareholders agreement’ might lead them to reflect that they were ‘taken for mugs’ by being sold something they already had.
The position stated above is because every limited liability company formed in the United Kingdom HAS Articles of Association by virtue of incorporation (even if they are only the default ‘Model Articles’ provided by the Companies Act legislation), and Articles of Association ARE a format of 'shareholders agreement'.
A limited company’s Articles of Association should be freely ascertainable and accessible from a company’s filing record, publicly available from Companies House’s website.
Look and find yours – usually the first item in a company’s filing record:- https://beta.companieshouse.gov.uk
Articles of Association provide rights available to, and bind with obligations upon, the various interested shareholders, directors and the relevant company (and recognise that the identities of both shareholders and directors may and do often change over time).
For various technical reasons, Articles of Association are a much more effective way of creating the vast majority of the relevant rights and obligations (which are advisable to exist / be created between the various interested parties in a company) - than seeking to do so in private shareholder agreements (although ‘uninitiated draftsmen’ continue to produce the same often largely worthless documents – absent any initial or ongoing consideration of what the relevant company’s Articles of Association might provide).
The technical advantages are largely the reason why public companies don’t have shareholders agreements (but are run pursuant to their Articles of Association) – and Articles of Association are the appropriate way (in the first instance) to set out the governance rules (rights and obligations) of a private company – especially with various diverse shareholders – as is the common situation seen.
That’s not to say that many company’s articles are appropriate for the companies in which they are being used – After all, if you paid less than GBP £50 for a company, there isn’t going to have been a lot of legally qualified thought (read ‘NONE’!) given as to whether the ‘shelf Articles’ are appropriate for your use.
Often they merely contain relaxations – so as to allow for the operation of (say) a ‘one man’ or ‘husband and wife’ company. They are very rarely appropriate for ‘a multi-stakeholder / quasi-partnership’ type of ownership structure.
Non-company lawyers habitually find Articles of Association quite difficult to comprehend - but I would encourage anyone involved with a limited company to initially set aside some time to seek to read and understand their existing Articles; before discussing with someone with appropriate legal experience and expertise - whether they are appropriate for the company structure in your specific circumstances (and in particular – whether they could be made much better) – long before some ‘snake-oil salesman’ seeks to sell you a ‘shareholders agreement’.
The lack of accessibility/complexity is largely a result of Articles (habitually) having to be consulted as / when / if there might be ‘contention’ between certain of the shareholders and/or the directors, representing the company – when the necessary level of detail is highly advisable (so that interested parties are restricted from seeking to avoid the Articles’ provisions; and much can be effected without the need to go to court).
My view is that Articles should be treated as an ‘insurance policy’ (or the foundations of good governance) – prepared as a means of encouraging amicable and constructive co-operation between shareholders and the board of directors (potentially the same – but ‘wearing different hats’) – often forming the ‘back-stop’ to which stakeholders will have to turn – should circumstances arise in which the interested parties are having difficulty in ‘playing nicely with each other’.
A good set of Articles should be capable of being prepared on the instruction of the board – with the aim of achieving that stated goal – and then ‘tucked in everyone’s bottom drawer’ – only to be consulted should contention arise between the various interested parties.
What shouldn’t happen is that they should be completely ignored – largely by virtue of the ignorance of the supposed business/legal advisor (or who – at best – recognises that they don’t have the legal knowledge or drafting skills to prepare them).
A skilled Solicitor (with expertise and experience in British company law) should be able to prepare a set of Articles on the basis of being instructed by the Board of Directors of the relevant company to produce a prudent & sensible set of governing documentation relevant to the specific circumstances of the company – which are designed to produce ‘equitable’ (i.e. fair and reasonable) outcomes for all of the stakeholders in the company (while reflecting sensible commercial arrangements either proposed by the Solicitor or instructed with regard to – e.g. (say) (un-)vesting arrangements for (very-)early leaver(s) from the venture etc.).
In the first instance, it’s arguably best to keep the drafting to a single class of (Ordinary) Shares (for all envisaged shareholders in the company) – as investors (in particular) find this (habitually) easier to understand. However, ‘one size does not fit all’ and a skilled legal professional should be examining the various stakeholder interests and proposing ‘fair and reasonable’ structures to reflect an equitable position.
In addition, Articles should be designed to ensure appropriate flexibility of board of directors actions (without abuse of shareholders), encourage a small / manageable shareholder base – through pre-emption on transfer (and leaver provisions to ensure no ‘sleeping partners’ are being carried by the ongoing management); and ensure that the company can be administratively simply and fairly sold – through exercise of a ‘drag-along’ provisions and right to exercise ‘tag-along provisions’ etc. (all of which are commercially advisable provisions for a private company with potentially – a relatively large and/or growing shareholder base).
This draftsman tends to include a few notes [by way of wording in square brackets] within the text of draft Articles to potentially assist the comprehension of the text – but it is generally best to ‘page-turn’ with a qualified Solicitor to discuss any aspects/issues – once the stakeholders have had an opportunity to read and consider the relevant draft.
‘The Gloss’ – Have a Shareholders Agreement (If You Want/Would Benefit From One)
Only after the advisability of (variations to – or more likely) new Articles of Association has been discussed and appropriately addressed – should the issue be addressed of whether an envisaged separate (and private) ‘shareholders agreement’ for appropriate interested parties is needed and/or advisable.
Whether there should be some agreement between the company and certain (or all) of the shareholders depends upon the particular facts – But there are arguments (after the position on Articles has been dealt with) for a relatively short shareholders agreement to be prepared (a 'wrap-around' in my parlance); - including aspects such as private agreements as to (say) restrictive covenants (upon ‘Executives’), dividend policy, and certain other management and operational matters.
This draftsman tends to use a ‘template’ shareholders agreement designed to ’wrap around’ (i.e. work in tandem with appropriate Articles) – but most shareholder agreements are largely designed for circumstances other than a quasi- partnership – e.g. they are requested by a material investor (if minority) shareholder and/ or venture capitalist – say which has ownership of a substantial proportion of the shareholding (but not control of the board by numbers – i.e. a MBO situation) etc.
This draftsman tends to prepare such a document (if deemed desirable or appropriate) with large sections – ‘Schedules’ - that the interested stakeholders can complete themselves – reflecting men of business agreeing upon their commercial plans.
If you want to discuss any of the above – Please do not hesitate to contact me.
However – If someone tells you that you ‘need’ a Shareholders Agreement (and doesn’t make any mention of your Articles of Association) – Be wise to the con!
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e-Telephone
http://www.EquitableLaw.com
Please feel free to schedule the proposed conversation with me via: - https://calendly.com/danielrobertjohnson
I wanted to take this opportunity ‘to get off my chest’ a set of circumstances that really annoy me – and which this ‘grumpy old Solicitor’ (specialising in British company / corporate matters) sees repeatedly in the marketplace. I hate seeing people fall for a con!
My ‘gripe’ is that there is a surprisingly large business advisory industry in the U.K. that seeks to actively market the sale of ‘Shareholders Agreements’ to early-stage ventures and diverse owner/managed businesses – being effectively, quasi-partnerships of entrepreneur individuals, coming together to found and/or develop businesses within the shell of a limited liability company.
At best, these ‘business advisors’ are inexperienced and/or inexpert – but many of them are completely unqualified, unauthorised, unregulated (and in reality – incapable of providing any redress) laymen as regards British company law – and their skill sets are more focussed upon 21st century web-advertising (and the like).
The strange aspect of legal agreement preparation is that unlike (say software – with which legal drafting otherwise has many similarities), a relative layman has difficulty in knowing ‘whether it works or not’ at the point ‘they pay their money’.
The ‘proof of the pudding’ is (often) in the eating – when one or other interested party wishes to enforce what they believe is a legal (and practically useful) document, often sometime in the future and that is often when one wishes they were not subject to the adage ‘you get what you pay for’.
Call me old fashioned, but when I’m feeling unwell – I would generally opt to discuss matters with a doctor or a pharmacist – whom I had some comfort are medically trained, experienced and relatively expert in their field (being authorised, regulated and insured). I don’t tend to take steps in relation to my health on the basis of a ‘health advisor’ who was trying to sell me a ‘magic potion’ over the internet!
Endlessly, the shysters in my legal sector will seek to tell the early stage venturers or diverse owner/ managers – “You absolutely MUST have a shareholders agreement” (which I would advise you to read as – “We have a ‘Word’ document of dubious provenance and extremely doubtful legal effect – which with our limited word processing skills we can make minimal amendments to – e.g. add your individual names and your relevant company name at the appropriate place where 'blanks' appear in the template we have – and then charge you (only) several hundred pounds for the privilege).
By the time that ‘shareholders agreement’ is actually considered by a legally qualified, authorised, regulated (and insured) Solicitor – attempting to deal with the ‘real world issues’ which have arisen under it – This Solicitor all too often has to inform the individuals involved that they have bought little more than ‘poor quality toilet paper’, which needs to be completely disregarded (in terms of seeking to help those who paid for it), and that regrettably – they don’t (in practice) have any realistic redress against those who sold them this garbage.
‘The Legal Reality’ – You ALREADY have a ‘Shareholders Agreement’
The first fact that those who have any involvement with a British limited liability company need to realise - is that I can guarantee (with 100% certainty) that they ALREADY effectively have a ‘shareholders agreement’ from the day that they formed their company (and that ‘perhaps’ the fact that this wasn’t discussed with them - when they bought ‘another shareholders agreement’ might lead them to reflect that they were ‘taken for mugs’ by being sold something they already had.
The position stated above is because every limited liability company formed in the United Kingdom HAS Articles of Association by virtue of incorporation (even if they are only the default ‘Model Articles’ provided by the Companies Act legislation), and Articles of Association ARE a format of 'shareholders agreement'.
A limited company’s Articles of Association should be freely ascertainable and accessible from a company’s filing record, publicly available from Companies House’s website.
Look and find yours – usually the first item in a company’s filing record:- https://beta.companieshouse.gov.uk
Articles of Association provide rights available to, and bind with obligations upon, the various interested shareholders, directors and the relevant company (and recognise that the identities of both shareholders and directors may and do often change over time).
For various technical reasons, Articles of Association are a much more effective way of creating the vast majority of the relevant rights and obligations (which are advisable to exist / be created between the various interested parties in a company) - than seeking to do so in private shareholder agreements (although ‘uninitiated draftsmen’ continue to produce the same often largely worthless documents – absent any initial or ongoing consideration of what the relevant company’s Articles of Association might provide).
The technical advantages are largely the reason why public companies don’t have shareholders agreements (but are run pursuant to their Articles of Association) – and Articles of Association are the appropriate way (in the first instance) to set out the governance rules (rights and obligations) of a private company – especially with various diverse shareholders – as is the common situation seen.
That’s not to say that many company’s articles are appropriate for the companies in which they are being used – After all, if you paid less than GBP £50 for a company, there isn’t going to have been a lot of legally qualified thought (read ‘NONE’!) given as to whether the ‘shelf Articles’ are appropriate for your use.
Often they merely contain relaxations – so as to allow for the operation of (say) a ‘one man’ or ‘husband and wife’ company. They are very rarely appropriate for ‘a multi-stakeholder / quasi-partnership’ type of ownership structure.
Non-company lawyers habitually find Articles of Association quite difficult to comprehend - but I would encourage anyone involved with a limited company to initially set aside some time to seek to read and understand their existing Articles; before discussing with someone with appropriate legal experience and expertise - whether they are appropriate for the company structure in your specific circumstances (and in particular – whether they could be made much better) – long before some ‘snake-oil salesman’ seeks to sell you a ‘shareholders agreement’.
The lack of accessibility/complexity is largely a result of Articles (habitually) having to be consulted as / when / if there might be ‘contention’ between certain of the shareholders and/or the directors, representing the company – when the necessary level of detail is highly advisable (so that interested parties are restricted from seeking to avoid the Articles’ provisions; and much can be effected without the need to go to court).
My view is that Articles should be treated as an ‘insurance policy’ (or the foundations of good governance) – prepared as a means of encouraging amicable and constructive co-operation between shareholders and the board of directors (potentially the same – but ‘wearing different hats’) – often forming the ‘back-stop’ to which stakeholders will have to turn – should circumstances arise in which the interested parties are having difficulty in ‘playing nicely with each other’.
A good set of Articles should be capable of being prepared on the instruction of the board – with the aim of achieving that stated goal – and then ‘tucked in everyone’s bottom drawer’ – only to be consulted should contention arise between the various interested parties.
What shouldn’t happen is that they should be completely ignored – largely by virtue of the ignorance of the supposed business/legal advisor (or who – at best – recognises that they don’t have the legal knowledge or drafting skills to prepare them).
A skilled Solicitor (with expertise and experience in British company law) should be able to prepare a set of Articles on the basis of being instructed by the Board of Directors of the relevant company to produce a prudent & sensible set of governing documentation relevant to the specific circumstances of the company – which are designed to produce ‘equitable’ (i.e. fair and reasonable) outcomes for all of the stakeholders in the company (while reflecting sensible commercial arrangements either proposed by the Solicitor or instructed with regard to – e.g. (say) (un-)vesting arrangements for (very-)early leaver(s) from the venture etc.).
In the first instance, it’s arguably best to keep the drafting to a single class of (Ordinary) Shares (for all envisaged shareholders in the company) – as investors (in particular) find this (habitually) easier to understand. However, ‘one size does not fit all’ and a skilled legal professional should be examining the various stakeholder interests and proposing ‘fair and reasonable’ structures to reflect an equitable position.
In addition, Articles should be designed to ensure appropriate flexibility of board of directors actions (without abuse of shareholders), encourage a small / manageable shareholder base – through pre-emption on transfer (and leaver provisions to ensure no ‘sleeping partners’ are being carried by the ongoing management); and ensure that the company can be administratively simply and fairly sold – through exercise of a ‘drag-along’ provisions and right to exercise ‘tag-along provisions’ etc. (all of which are commercially advisable provisions for a private company with potentially – a relatively large and/or growing shareholder base).
This draftsman tends to include a few notes [by way of wording in square brackets] within the text of draft Articles to potentially assist the comprehension of the text – but it is generally best to ‘page-turn’ with a qualified Solicitor to discuss any aspects/issues – once the stakeholders have had an opportunity to read and consider the relevant draft.
‘The Gloss’ – Have a Shareholders Agreement (If You Want/Would Benefit From One)
Only after the advisability of (variations to – or more likely) new Articles of Association has been discussed and appropriately addressed – should the issue be addressed of whether an envisaged separate (and private) ‘shareholders agreement’ for appropriate interested parties is needed and/or advisable.
Whether there should be some agreement between the company and certain (or all) of the shareholders depends upon the particular facts – But there are arguments (after the position on Articles has been dealt with) for a relatively short shareholders agreement to be prepared (a 'wrap-around' in my parlance); - including aspects such as private agreements as to (say) restrictive covenants (upon ‘Executives’), dividend policy, and certain other management and operational matters.
This draftsman tends to use a ‘template’ shareholders agreement designed to ’wrap around’ (i.e. work in tandem with appropriate Articles) – but most shareholder agreements are largely designed for circumstances other than a quasi- partnership – e.g. they are requested by a material investor (if minority) shareholder and/ or venture capitalist – say which has ownership of a substantial proportion of the shareholding (but not control of the board by numbers – i.e. a MBO situation) etc.
This draftsman tends to prepare such a document (if deemed desirable or appropriate) with large sections – ‘Schedules’ - that the interested stakeholders can complete themselves – reflecting men of business agreeing upon their commercial plans.
If you want to discuss any of the above – Please do not hesitate to contact me.
However – If someone tells you that you ‘need’ a Shareholders Agreement (and doesn’t make any mention of your Articles of Association) – Be wise to the con!
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e-Telephone
http://www.EquitableLaw.com
Please feel free to schedule the proposed conversation with me via: - https://calendly.com/danielrobertjohnson
Further Awards for Equitable Law - Solicitors
We Are Delighted To Announce - Equitable Law Has Been Awarded:-
'Best Business Law Firm - London'
and
'Commercial Law Specialist of the Year - London'
by Acquisition International ('AI') in its 2018 Annual Awards.
'Best Business Law Firm - London'
and
'Commercial Law Specialist of the Year - London'
by Acquisition International ('AI') in its 2018 Annual Awards.
Equitable Law Legally Advises & Assists With SEIS and EIS Aspects of a FTSE 250 Technology Spin-Out
Equitable Law is delighted to announce the conclusion of its legal advice and assistance to 'Dolphin N2' - A technology 'spin out' from Ricardo PLC, the FTSE 250 admitted (listed) global engineering, environmental and strategic consultancy (which is also a specialist niche manufacturer of high-performance products).
Mr. Dan Johnson assisted Ricardo's spin-out venture with obtaining both Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) advance assurance of qualification for tax reliefs from HMRC (the U.K.'s taxation authority) for the benefit of its various founders/managers and external investors.
Further information with regard to the venture is available at:-
https://ricardo.com/news-and-media/press-releases/ricardo-spin-out-company-formed-to-exploit-potenti
https://www.linkedin.com/pulse/cryopower-clean-diesel-dolphin-n2-explores-some-global-simon-brewster/
Mr. Johnson commented:-
"This work continues my 'record' of having obtained advance assurances in relation to every single (= 100%) advance assurance application I have ever been professionally involved with - including (on only) one occasion when I had to educate HMRC as to the application of the legislation to particular factual circumstances (N.B. No one should treat Wikipedia as a completely accurate source of information!) .
On occasion, this has involved adjustments to the relevant investee company's arrangements so that their plans comply with the relevant legislation - so that any advance assurance they might obtain has validity (and is unlikely to be subsequently challenged by HMRC).
In reality, the preparing and submitting an appropriately detailed application for advance assurance is the 'real process' by which an investee company (and most importantly - its prospective investors) can gain comfort that they will genuinely qualify for the tax reliefs under the relevant SEIS and EIS legislation.
There are regrettably a lot of non-legally qualified and/or unauthorised advisors in this field - whose advice and assistance is of dubious quality.
An advance assurance obtained on the basis of incorrect or incomplete information isn't worth the paper it's written upon - So seek efficient and cost-effective advice (from a Solicitor) - Not something that is 'cheap and (potentially) nasty from 'sub-optimal advisors."
Mr Johnson added:-
"I wish 'Dolphin N2' every success with their project, which has the opportunity to make a significant impact in reducing CO2 emissions from diesel engines".
For any legal advice and assistance with SEIS and EIS projects, please do not hesitate to contact:-
Mr. Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e-Telephone
www.EquitableLaw.com
October 2018
Mr. Dan Johnson assisted Ricardo's spin-out venture with obtaining both Seed Enterprise Investment Scheme (SEIS) and Enterprise Investment Scheme (EIS) advance assurance of qualification for tax reliefs from HMRC (the U.K.'s taxation authority) for the benefit of its various founders/managers and external investors.
Further information with regard to the venture is available at:-
https://ricardo.com/news-and-media/press-releases/ricardo-spin-out-company-formed-to-exploit-potenti
https://www.linkedin.com/pulse/cryopower-clean-diesel-dolphin-n2-explores-some-global-simon-brewster/
Mr. Johnson commented:-
"This work continues my 'record' of having obtained advance assurances in relation to every single (= 100%) advance assurance application I have ever been professionally involved with - including (on only) one occasion when I had to educate HMRC as to the application of the legislation to particular factual circumstances (N.B. No one should treat Wikipedia as a completely accurate source of information!) .
On occasion, this has involved adjustments to the relevant investee company's arrangements so that their plans comply with the relevant legislation - so that any advance assurance they might obtain has validity (and is unlikely to be subsequently challenged by HMRC).
In reality, the preparing and submitting an appropriately detailed application for advance assurance is the 'real process' by which an investee company (and most importantly - its prospective investors) can gain comfort that they will genuinely qualify for the tax reliefs under the relevant SEIS and EIS legislation.
There are regrettably a lot of non-legally qualified and/or unauthorised advisors in this field - whose advice and assistance is of dubious quality.
An advance assurance obtained on the basis of incorrect or incomplete information isn't worth the paper it's written upon - So seek efficient and cost-effective advice (from a Solicitor) - Not something that is 'cheap and (potentially) nasty from 'sub-optimal advisors."
Mr Johnson added:-
"I wish 'Dolphin N2' every success with their project, which has the opportunity to make a significant impact in reducing CO2 emissions from diesel engines".
For any legal advice and assistance with SEIS and EIS projects, please do not hesitate to contact:-
Mr. Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 = U.K. Cellular / e-Telephone
www.EquitableLaw.com
October 2018
Friday 18 May 2018
Equitable Law Limited has been awarded Best M&A Law Firm - London
We are absolutely delighted to report that Equitable Law has been awarded Best M&A Law Firm - London by 'Acquisitions International' (AI)
https://www.aiglobalmedialtd.com/acquisition-international/
More - To follow
Tuesday 24 April 2018
Equitable Law Assists 'The Crystal Maze' With EIS Fund Investment
Equitable Law is pleased to announce our legal advice and assistance with a recent Three Million British Pounds Plus (GBP £3,150,000) investment (by investors managed by Edition Capital) by way of new equity subscription - into this Solicitors practice's client, Little Lion Entertainment Limited ('Little Lion').
The investment places a substantial Eight Figure British Pound (GBP £xx,000,000) valuation upon Little Lion, a company only incorporated in December 2014, with a share capital of GBP £1,000 (and whom Equitable Law has acted for since our introduction in early 2015).
Little Lion is the company behind the highly successful 'Crystal Maze Live', the sell-out live version of the popular 1990’s British TV show.
The current London venue opened in 2016 (after a highly successful initial crowdfunding process), with teams of up to eight navigating the various zones and challenges featured in the programme before reaching the iconic crystal dome.
The launch of the experience was met with critical acclaim, and has consistently positive reviews in the press, resulting in an expansion of the brand to include a central Manchester location (upon the 'Granada TV' site).
The two venues are currently generating annualised GBP £2.2m EBITDA on GBP £8m of revenue.
The investment will be used to relaunch the company’s new London venue in a flagship Central London location - scheduled to open by January 2019, as the current London site closes.
The new venue will be designed to double the capacity from 256 to 512 people per day, with the corporate booking and sponsorship opportunities being further developed.
The team forecast annual EBITDA of £4.7m across the new London and existing Manchester venues, once London is fully operational.
Following the success of Crystal Maze Live, the show returned to TV on Channel 4 introducing a new generation of fans to the concept to further strengthen the brand appeal.
The Directors of Little Lion commented;
"We are delighted to take this opportunity to thank Mr. Dan Johnson of Equitable Law for his support of our business over recent years - as our 'General Counsel', and in particular, his sterling work during this stage of our business' development. We look forward to working further with Dan - As our business grows and develops."
For more information, please see:-
http://ramcapital.co.uk/wp-content/uploads/2017/11/First-Edition-EIS-Spring-18-Investment-Summary.pdf
“Crystal Maze London: This exhilarating ride is worth every penny” London Evening Standard
The investment places a substantial Eight Figure British Pound (GBP £xx,000,000) valuation upon Little Lion, a company only incorporated in December 2014, with a share capital of GBP £1,000 (and whom Equitable Law has acted for since our introduction in early 2015).
Little Lion is the company behind the highly successful 'Crystal Maze Live', the sell-out live version of the popular 1990’s British TV show.
The current London venue opened in 2016 (after a highly successful initial crowdfunding process), with teams of up to eight navigating the various zones and challenges featured in the programme before reaching the iconic crystal dome.
The launch of the experience was met with critical acclaim, and has consistently positive reviews in the press, resulting in an expansion of the brand to include a central Manchester location (upon the 'Granada TV' site).
The two venues are currently generating annualised GBP £2.2m EBITDA on GBP £8m of revenue.
The investment will be used to relaunch the company’s new London venue in a flagship Central London location - scheduled to open by January 2019, as the current London site closes.
The new venue will be designed to double the capacity from 256 to 512 people per day, with the corporate booking and sponsorship opportunities being further developed.
The team forecast annual EBITDA of £4.7m across the new London and existing Manchester venues, once London is fully operational.
Following the success of Crystal Maze Live, the show returned to TV on Channel 4 introducing a new generation of fans to the concept to further strengthen the brand appeal.
The Directors of Little Lion commented;
"We are delighted to take this opportunity to thank Mr. Dan Johnson of Equitable Law for his support of our business over recent years - as our 'General Counsel', and in particular, his sterling work during this stage of our business' development. We look forward to working further with Dan - As our business grows and develops."
For more information, please see:-
http://ramcapital.co.uk/wp-content/uploads/2017/11/First-Edition-EIS-Spring-18-Investment-Summary.pdf
“Crystal Maze London: This exhilarating ride is worth every penny” London Evening Standard
Tuesday 10 April 2018
Legal Fees Negotiation . . .
Sometimes, you just have to accept that some people treat the businesses (they are negotiating fees on behalf of) in the same manner as this individual treats this dental work . . .
https://www.youtube.com/watch?v=7_qwjcxwUqw
Regards
Dan.Johnson@EquitableLaw.com
+44 (0) 7788 537 187 : U.K. Cell. / e-Tel.
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