Before setting up a company, it needs to be registered with the Registrar of Companies at Companies House. This is known as incorporation and it is advisable to seek legal advice beforehand to ensure that incorporation is the right business structure for you. Each company is governed by two key documents namely the Memorandum and the Articles of Association. The Memorandum sets out the objectives for which the company was formed and the scope of the company’s authority to carry out certain actions. Unless an action is detailed in the Memorandum the company is not allowed to undertake it. Certain care therefore is needed when creating the company. The Articles of Association set out the procedure for dealing with meetings of the company, the transfer of shares in the company, who can and cannot be a member of the company, and how the directors must act in relation to the company. We can assist with regard to the setting up of your company and will normally charge a fixed fee unless the matter is complicated.
If you are buying someone else’s business it is sometimes easier to simply buy the shares in the company that owns the business and require the existing directors to resign so that in effect you take control of the company and its ownership. Such a transaction is however quite complicated and needs to be handled with care as there are many aspects to running a business which need to be addressed within the agreement. The matters that need to be considered are employees, warranties given to banks and other suppliers, existing debts of the company and existing trading Contracts. The share sale agreement also makes provision for the tax deed, indemnities, transfer documents, warranties, non compete agreements, and finance details for the sale.
The share sale agreement is a contract between the existing shareholders of the company (the seller) and the new shareholders (the buyer). The contract often requires careful negotiation to ensure that every aspect of the business is dealt with within one document. There are also numerous company forms which will need to be completed and signed to notify Companies House of the change of shareholders, directors etc. We will assist you in the preparation and negotiation of all these documents.
Because the matter is complex, we will charge normally on an hourly basis for dealing with such matters. Please contact Nick Hart at firstname.lastname@example.org for further information or advice, or telephone 020 8854 1331 to make an appointment.