newmercman:
If you are buying a company because of its contracts then you would not be getting ripped off if the previous owner started up with the contract again, you would be a fool
You would have legal documents drawn up stating that the contract is now yours and the previous owner cannot bid for it again for a specific period, there’s a name for it, but it eludes me at present
When a company is sold, it would be quite common for a condition to be stipulated that the previous owner cannot engage in any type of road transport business for a specific period, five years is quite common.
newmercman:
If you are buying a company because of its contracts then you would not be getting ripped off if the previous owner started up with the contract again, you would be a fool
You would have legal documents drawn up stating that the contract is now yours and the previous owner cannot bid for it again for a specific period, there’s a name for it, but it eludes me at present
Very true, but having leagle docs is all very well. But having the time, money and effort to take someone to court is another. Could take 2 years just to get a mis trail let alone a result in your favour. By then you could have gon bust already and have no money to hire a law firm.
known far to many people lose court battles when thay were morally in the right.
newmercman:
If you are buying a company because of its contracts then you would not be getting ripped off if the previous owner started up with the contract again, you would be a fool
You would have legal documents drawn up stating that the contract is now yours and the previous owner cannot bid for it again for a specific period, there’s a name for it, but it eludes me at present
When a company is sold, it would be quite common for a condition to be stipulated that the previous owner cannot engage in any type of road transport business for a specific period, five years is quite common.
In reality why would anyone buy a small company with no real history, Its £15 to set up a ltd company I could do it today and have one with a 1 million turnover in the first12 months and making 150k profit on turnover, Would it have any real value then still if it has no fixed/written contracts and no real assets apart from its balance sheet ? in my opinion probably no
Another advert in an identical vein, this time from the Commercial Motor, 31st October 2013.
I’m not going to phone because I’m not ready to sell up yet and I’m not going to waste the bloke’s time, but once again, if anybody has any direct experience of trading a Limited Company then I would appreciate their input, particularly in terms of the financial value and the legal aspect.
Legally inform anyone you have personal guartees with your no longer a director shareholder of company
Also put in writing andproof it went to them
(Know so eone sold a genuine business few years back and turned iut they were asset strippers took the money ran up debts and left it all bought 5/6 firms across uk)
Any way euroshell came back to original director for 150k as they had not authorised the change
It went to court and as he posted and faxed them and had recepts for both were sent luckily was
Thrown out of court
Only other thing to protect your repute is to notify vosa that you wish to terminate your tm mwith company
I’m sure it would need far more than a meet up in an MSA and a handshake, if I did sell any company then I’d get a specialist transport solicitor involved with it, obviously they send all operators regular mailshots touting for work, including me.
What I really need to know is if any member does know of anyone who has bought or sold a transport company in this way who can flesh out the details a bit?
Legal bits to but accountant would advise be a contract to sign
If contracts prob normally you wont set back upfor 2-5 years etc
Then just a case of notifying companies house etc and any suppliers hp agreements
You hAve personal guarantees with to protect yourself
Solicitor would draw up All relevent paperwork etc
You need to do several things to sell a ltd company - have done it a few times with companies (not transport companies) to different extents, partial to full sale.
You need to deal with companies house to nominate a new director (there must always be I person director, and if your stepping down…) and after appointment of the new one you can also be removed.
You then need to complete SH01/SH02 forms to transfer your shares (or split them and transfer/issue shares in case of a partial sale) to the new owner. This is also confirmed by your next annual return- which you can submit early to clarify if you want.
If there is any money changing hands for the shares then you also need to complete an HMRC ‘stock transfer form’. It records the value of the sale and any stamp duty due on the sale of shares. If there is it must be sent in to HMRC with payment, if not it must just be kept in the company register with your accounts etc- this also acts as their and your proof that you agree to the share transfer- as believe it or not you can remove a director and transfer shares without the owners knowing. You shouldn’t, but its possible as their sig is not needed.
Your old share certificates must be returned and new ones issued to the new owners. This whole lot should be detailed in a contract of sale, so the appointment of a new director and your resignation, the share transfer, the change of ownership of all assets owned by the companies (material or contract etc) and of course showing due diligence has been carried out - so they are happy with bank records, history and that there is nothing hiding under the surface.
Finally change of directorships and share issues must be agreed via general resolution, and a copy of these must be put in the company register also.
Then that’s it- your clear. But bear in mind not owning or being a director anymore does not mean your not still the registered TM etc- so you must deal with that accordingly or contract yourself to the new owner for an agreed fee.
Sorry to be sooooo long but thought I’d make it clear as muck. if I could.
if I could.