direct indemnity of business owned by trust

Discussion in 'Debt and Bankruptcy Law Forum' started by walone01, 7 June 2018.

  1. walone01

    walone01 Member

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    i have been asked to be a director of a company owned by a trust. is there any doc that can be compiled to ensure indemnity of any debts of company with these being covered by the investors in the trust
     
  2. Tim W

    Tim W Lawyer
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    Hard to give meaningful answers without seeing the specifics of the deal on offer.

    1. If you don't understand it, don't sign up for it.
    Your gut is a good guide.
    And if the little voices tell you that you're being set up to cop all the liability,
    then they are probably right.

    2. Have you been asked to be a director of the company,
    or to be a trustee?

    3. What do you mean by "investors in the trust"?

    4. Are they offering you an employee role? Or just a seat on the board?
    If the latter, how will you be paid/ remunerated/ compensated?

    5. Will there be Directors' Indemnity Insurance?

    6. Do the trustees (and/or beneficiaries or unit holders)
    expect you as a director to act at their direction and control?
    This is very often turns out to be unworkable.
     
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  3. Rob Legat - SBPL

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    There's also the angle of ensuring that the trustee is entitled to reimbursement out of the trust for expenses incurred. If you do agree to be a director of a corporate trustee, you want to ensure the company does not go insolvent because the trust won't loosen the purse strings.
     
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