How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask Alex J. Your Own Question
Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3653
Experience:  Solicitors 2 years plus PQE
13113900
Type Your Law Question Here...
Alex J. is online now

We have 2 coach companies and a holding company. Can you tell

Resolved Question:

We have 2 coach companies and a holding company. Can you tell us where we can find information regarding what we can legally put into the holding company and how this needs to be done. e.g. can we put our coaches into the holding company if they still have finance commitments.
Submitted: 2 years ago.
Category: Law
Expert:  Alex J. replied 2 years ago.
Hi,
Thank you for your question and welcome.
My name is ***** ***** I will assist you.
Does the holding company have any trade going through i.e cash balances etc?
If the coaches still have finance - which company is named on the finance agreements?
Kind regards
AJ
Customer: replied 2 years ago.

At present the holding company does not have any trade going through and both companies have finance agreements.

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
Firstly if you want to transfer the vehicles from the two trading companies to the holding company, you will probably need the consent of the finance company.
Secondly - a holding company is really a term of art not a legal term, the only legal implication is using the word "Holding" in your company name - the company has to have a subsidiary to be a holding company. A holding company traditionally does not actually trade - it holds assets like coaches, shares in other companies.
On that basis, what exactly do you want to do with this company? Do you want to channel the profits up to it some how?
Kind regards
AJ
Customer: replied 2 years ago.

The holding company has been set up with the 2 trading coach companies as its subsidiaries since March 2013.

If we wish to put the coaches into the holding company do we legally have to ask permission of the finance company ?

Should we chose to put the coaches into the holding company how do we do so.

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
You would need to transfer the ownership of the log books to the holding company.
The holding company would pay for them, but the money would not actually change hands, it could just be recorded as a debt in the company accounts.
If you do transfer ownership of the coaches without the finance company consent, then you may be in breach of the finance agreement.
Who will pay the finance agreements?
Kind regards
AJ
Customer: replied 2 years ago.

Many thanks for your reply, however it would appear that this will be difficult to achieve without the consent of the finance companies and causing considerable disruption therefore is not a option.

Thank you for clarifying the position.

Kind regards

Ian

Expert:  Alex J. replied 2 years ago.
Hi,
Thank you.
What you could consider is making the Holding Company the manager of these coaches and effectively charge the other companies a legitimate management fee.
The purpose of this would be if you want to insulate some of the cash of the business from the creditors of the trading companies.
I wish you the best of luck.
Kind regards
AJ
Alex J. and other Law Specialists are ready to help you