DOCUMENT A
● John was a director who most likely will possess know-how.
● When John leaves the company, Clause 8 of his employment contract will no longer be
applicable. This puts the buyer at risk of he releases the information of which he is aware.
○ The fact that the employment agreement claims the CA will continue after
termination of the agreement ‘without any limit in time’ will not be an applicable
restrictive covenant. It will not be seen to the court as enforceable as the fact there is
no time limit will cease to be legit.
● (Clause 11) 24 months is unlikely to be seen as a reasonable length of time and is therefore
likely to be seen as another unenforceable restrictive covenant.
● John will be a member of the LTC retirement benefits scheme.
DOCUMENT B
● Freelance staff- as there is no obligation to offer them work/they are at liberty to decline, there
could be a risk of losing a number of members of staff following the acquisition.
● As they have to give 48hours notice if they cannot work and they have a list of
responsibilities and that they are paid by hour and have to submit time sheets, it can be seen
that these individuals are employees and are not self-employed therefore this could be
problematic RE the VAT claim.
DOCUMENT C
● TUPE means that the buyer will be bound to honour the contracts held by the employees.
● Carry out a review of the TCs to ensure that the provisions are appropriate and enforceable
during the acquisition.
● If the employee is dismissed, the restrictive covenants are no longer enforceable (General
Billposting)
DOCUMENT D
● LTC and Eurolearn are in a cross-guarantee.
● The bank, who have the benefit of the cross-guarantee, may be reluctant to agree to release
unless a new guarantor of the same or better financial status takes over. If they cannot be
released, Eurolearn will have continuing liability to LTC after the transfer.
DOCUMENT E
● The acquisition agreement must contain restrictive covenants which prevent the seller from
competing with Eurolearn for business for a specified period/from soliciting existing
customers/using a similar business name.
● Clause 2- the contract ends this year, this could mean that the target ends up losing one of the
biggest clients.
DOCUMENT F
● Clause 2- this contract ends in less than a year. Losing this client could have a substantial
impact on the turnover of the target.
DOCUMENT G
● Deemed distribution at an undervalue.
● John was a director who most likely will possess know-how.
● When John leaves the company, Clause 8 of his employment contract will no longer be
applicable. This puts the buyer at risk of he releases the information of which he is aware.
○ The fact that the employment agreement claims the CA will continue after
termination of the agreement ‘without any limit in time’ will not be an applicable
restrictive covenant. It will not be seen to the court as enforceable as the fact there is
no time limit will cease to be legit.
● (Clause 11) 24 months is unlikely to be seen as a reasonable length of time and is therefore
likely to be seen as another unenforceable restrictive covenant.
● John will be a member of the LTC retirement benefits scheme.
DOCUMENT B
● Freelance staff- as there is no obligation to offer them work/they are at liberty to decline, there
could be a risk of losing a number of members of staff following the acquisition.
● As they have to give 48hours notice if they cannot work and they have a list of
responsibilities and that they are paid by hour and have to submit time sheets, it can be seen
that these individuals are employees and are not self-employed therefore this could be
problematic RE the VAT claim.
DOCUMENT C
● TUPE means that the buyer will be bound to honour the contracts held by the employees.
● Carry out a review of the TCs to ensure that the provisions are appropriate and enforceable
during the acquisition.
● If the employee is dismissed, the restrictive covenants are no longer enforceable (General
Billposting)
DOCUMENT D
● LTC and Eurolearn are in a cross-guarantee.
● The bank, who have the benefit of the cross-guarantee, may be reluctant to agree to release
unless a new guarantor of the same or better financial status takes over. If they cannot be
released, Eurolearn will have continuing liability to LTC after the transfer.
DOCUMENT E
● The acquisition agreement must contain restrictive covenants which prevent the seller from
competing with Eurolearn for business for a specified period/from soliciting existing
customers/using a similar business name.
● Clause 2- the contract ends this year, this could mean that the target ends up losing one of the
biggest clients.
DOCUMENT F
● Clause 2- this contract ends in less than a year. Losing this client could have a substantial
impact on the turnover of the target.
DOCUMENT G
● Deemed distribution at an undervalue.
