Arguments for MLSP and Oasis in Share Forfeiture Case

Question from sanam, Arguments for MLSP and Oasis in Share Forfeiture Case

Answer from AI:

Arguments on Behalf of MLSP (Claimant)

1. Improper Decision-Making Process

• The decision to forfeit shares was made solely by the managing director from Oasis, without the presence or consent of the two directors from MLSP. This could be a violation of corporate governance rules and the company’s bylaws, which typically require a quorum or majority vote for such significant decisions.
• MLSP can argue that the decision-making process was not transparent and did not follow the proper procedures, making the forfeiture invalid.

2. Strict Compliance with Contract Terms

• The contract stipulated an EBITDA target of 300 million. MLSP can argue that the target was not met, as only 299.96 million was achieved, and therefore, the condition for the subscription price payment was not fulfilled.
• MLSP can emphasize the importance of adhering strictly to the contract terms, as even a minor shortfall should be considered a failure to meet the agreed-upon target.

3. Lack of Force Majeure Clause

• Since there is no force majeure clause in the contract, Oasis cannot use the COVID-19 pandemic as a justification for not meeting the EBITDA target.
• MLSP can argue that the absence of such a clause indicates that both parties agreed to bear the risks associated with unforeseen events, and therefore, the shortfall cannot be excused.

Arguments on Behalf of Oasis (Respondent)

1. Substantial Performance Doctrine

• Oasis can argue that the EBITDA target was substantially achieved, as the shortfall was only 0.04 million, which is a negligible amount in the context of a 300 million target.
• Under the substantial performance doctrine, minor deviations from the contract terms that do not significantly affect the overall outcome may be excused.

2. Impact of Unforeseeable Events

• Oasis can argue that the COVID-19 pandemic was an unforeseeable event that significantly impacted business operations and financial performance.
• Even though there is no force majeure clause, courts may consider the extraordinary nature of the pandemic and its impact on achieving the EBITDA target.

3. Good Faith and Fair Dealing

• Oasis can argue that the decision to forfeit shares was made in good faith and in the best interest of the company, considering the extraordinary circumstances.
• They can also argue that MLSP’s strict interpretation of the contract terms is unreasonable and does not align with the principle of fair dealing.

Legal Advice and Consultation

Given the complexity of this case and the potential implications for both parties, it is crucial to seek personalized legal advice. Consulting with a legal professional who specializes in corporate law and contract disputes can provide tailored guidance based on the specific facts and jurisdiction of the case.

For more information on corporate governance and contract law, you can refer to resources such as:

• SEC Corporate Finance Guidance
• U.S. Courts Business and Consumer Forms

Remember, this information is intended to provide a general understanding of the legal issues involved and should not be considered as specific legal advice. Always consult with a qualified attorney for advice tailored to your particular situation.