We are delighted to announce that our private wealth law department has continued to maintain its Band 2 position in the latest edition of Chambers and Partners High Net Worth.
Things are moving very quickly, and it is difficult to predict what will happen, but we would advise you to consider the following potential issues sooner rather than later.
Financial covenants: if there either has been or could be a drop in income, then this could affect any interest cover covenant in your loan agreements. This is often reported quarterly and so may not be reported until the next quarter-end of 30 June. However, please see below the ‘No Default’ representation. Knowing that you are very likely to breach a financial covenant could be a Potential Event of Default.
Events of Default: the following events may be triggered over the next three months:
- Breach of financial covenants – non-compliance with any financial covenants will be an event of default without any grace period;
- Auditors’ qualification – will they have to make a material qualification to your accounts or make a material qualification to the audited accounts of any other member of your group;
- Cross-default, insolvency-related events or cessation of business – if your events of default extend to other members of your group and they are in financial difficulty, could their situation cause an event of default?
- Material Adverse Change – could this crisis and any related cashflow issues be “any event or circumstance or series of events or circumstances” that “has or could reasonably be expected to have a Material Adverse Effect”?
Representations: when you are requesting a loan or at the time of making any loan, on the first day of each interest period, and on each day a finance document is entered into, the borrower has to repeat certain representations to the lender. These include:
- No Default – no event of default [or potential event of default] has occurred and is continuing or would result from the making of any loan;
- Accounts – save as previously disclosed in writing to the lender there has been no material adverse change in its financial condition since the date to which those accounts were drawn up.
Drawdown of loans and representations: As mentioned above, it is usual that you will have to repeat most if not all the representations before you can drawdown a loan. If there has been an actual event of default or a potential event of default, then the lender can refuse your request to drawdown any loan. Potential Event of Default generally means an event or circumstance that, with the giving of notice, the expiry of a grace period, the making of any determination under the finance documents or the fulfilment of any other applicable condition (or any combination of the foregoing), would constitute an event of default.
Information covenants: Most loan agreements require you to notify the lender of any event of default or potential event of default promptly upon it becoming aware of its occurrence.
Recommendations: Stress test your cashflows, check your loan arrangements, and if there are any concerns be open and transparent with your lenders. If a waiver is needed, request it as soon as possible.
Charities, like other organisations, may be subject to or choose to voluntarily comply with the reporting requirements under the Modern Slavery Act 2015.
The draft regulations making it mandatory for anyone entering a registered care home in England to have been double vaccinated unless they are clinically exempt were made on 22 July 2021.
In the Transforming Public Procurement Green Paper, the Government signalled its desire to increase its control over procurements by all contracting authorities.
The monthly round-up from the Anthony Collins Solicitors charities team.
Legal updates as the UK enters into stage 4 of the roadmap and legal restrictions on face coverings and social distancing are lifted.
The first disability we are going to discuss is diabetes. We begin by discussing the different types of diabetes; their similarities and differences and how we live with the disability within our day.
Tim Coolican and Freya Cassia explore the legal and practical options available to providers if a disappointing result is received following an inspection.
Following the launch of the CQC’s new strategy for how it regulates health and social care, many providers will be keen to know more about how the changes might affect them in the future.
EPC’s are not required to be served with a Section 21 notice for assured shorthold tenancies if the tenancy predates October 2015.
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