Market dynamics sometimes require drastic changes in your business.
Market dynamics sometimes require drastic changes in your business.
Restructuring may be needed for growth, simplifying a group, selling activities or resolving financial difficulties. The legal route must fit the commercial objective. Guldemond Advocaten helps businesses and directors prepare and implement changes through our corporate law and restructuring and insolvency practices.
Start with an overview of the companies, activities, financing and key contracts. Which entity employs staff, which owns the intellectual property and where are guarantees or security located? The legal structure may differ substantially from the organisation chart used in daily operations.
We investigate which elements genuinely need to change and which conditions may prevent implementation. A business may internally transfer an activity while first needing permission from its bank, landlord or customer. A feasible timetable therefore starts with existing obligations and dependencies.
A statutory merger or demerger has different consequences from the sale and transfer of individual assets. In an asset transfer, the relevant property and rights must be transferred in the appropriate manner; transfer of a contract generally requires the counterparty’s cooperation. A general description that the business is being transferred is insufficient for every component.
Statutory mergers and demergers have their own procedures, documentation and protection for affected parties. We work with the notary and assess implications for contracts, shareholders and creditors. See also mergers and acquisitions. Cross-border reorganisations require additional examination of foreign rules and practical implementation in each country involved.
Establish which corporate bodies must decide and whether shareholders, supervisory directors or financiers must give prior approval. Authority to sign is not the same as authority to decide without internal approval. Defective decision-making may cause delay or a separate dispute.
Record the business’s interests, alternatives and relevant risks. Transactions with shareholders or group companies require attention to possible conflicts of interest. Directors must continue to exercise their own responsibility; a group interest does not automatically justify disregarding a subsidiary’s interests. Read more about directors’ liability.
A reorganisation may change roles, create redundancies or constitute a transfer of an undertaking. These consequences must be assessed for each route. On a transfer of an undertaking, rights and obligations under employment contracts may transfer by operation of law. An agreement between seller and buyer that staff remain behind is then not decisive in relation to employees.
Where required, the works council must also have a timely opportunity to exercise meaningful influence. The Social and Economic Council explains consultation rights for significant organisational changes. A request for advice after binding arrangements have effectively eliminated alternatives may come too late. We connect transaction planning with employee participation, collective employment law and any dismissal processes.
Financial difficulties require assessment of whether the business can continue meeting its obligations. A payment arrangement, refinancing or sale may provide room, but requires a substantiated liquidity forecast. Asset transfers within a group may prejudice creditors and later be challenged. Consider the consideration given, valuation and available alternatives too.
Subject to conditions, a WHOA plan may modify creditors’ or shareholders’ rights. A commencement declaration alone creates no general protection against enforcement measures. A court-ordered cooling-off period has its own conditions and limits. Where bankruptcy threatens, we also discuss the board’s obligations and risks.
Signing is usually an intermediate step. Transfers, registrations, consents, employee communications and transitional arrangements still require implementation. Clarify who is responsible for invoicing, services, data and remaining obligations. A carve-out may need temporary support from the former organisation.
After implementation, check that bank authorities, Trade Register details, insurance and contractual contact persons reflect the new situation. Licences and intellectual property must also be capable of following the activities in practice. A legal structure is useful only if the business can work with it.
Yes. Preparing for a sale, simplifying a group or separating activities may also justify it. The applicable rules depend on the steps chosen.
No. That varies by legal route and agreement. Consents, statutory transfer and contractual change provisions must be examined separately.
With your organisation and advisers, we establish a workable sequence for investigation, decision-making and implementation. Contact us with the organisation chart, key agreements and intended outcome.
