Corporate finance › Stock Exchange Listings

Listing Liability

When the share capital of a company is listed on the London Stock Exchange or floated on AIM it is still necessary for representations and warranties to be given. Indeed there is far greater liability arising under the provisions of the Stock Exchange Listing Regulations, The Financial Services Act, the Companies Act and other statutes, than on a private sale.

Extent of Liability

Liability will normally arise in respect of the:

Schedule of warranties
Tax Indemnity
Prospectus Liability
Indemnity to the Sponsor/Nomad

This liability will normally fall on the shoulders of the:

Vending Shareholders
Directors
Company (if new money is being raised)

Period of liability – 6 years

Cover Available

Insurance protection is available which covers the parties assuming the liability in respect of the types of liability listed above. The policy is issued for a six year period to run concurrent with the liability and does not contain a cancellation clause.