Legal Prejuduce 3 - Lessons In Life

Chapter 30

The next morning Rose was fizzing with excitement and it was rubbing off on Emmie somewhat as Dan and Allie drove them to the school. Rose skipped along holding Daniel's hand while Allie tucked Emmie's hand into her arm murmuring, "Remember, if you really don't like it you can just stay home with Margie after today. Just give it a try." When they reached reception they were swiftly met by the admissions clerk who escorted them first to Rose's brightly coloured classroom and then to Emmie's more grown up classroom with desks in groups of four. Both girls were given a buddie to show them around and Dan and Allie left. Walking out the admissions clerk looked at their anxious faces and said, "Try not to worry, they'll be fine. New girls are always treated like superstars; it's the novelty value. They'll have a ball." They thanked her and made their way back to the car where Daniel kissed her before getting in saying, "Let's get back and get this deal done."

They collected Max and Jeremy before nine and by nine thirty they were back at Aviemore ahead of the meeting with Aviemore's supplier relationship lead Stefan Meyer in Germany at ten. Eric Aubert came to join them for coffee and Richard and Ben arrived shortly afterwards. They joined the link for the meeting in the video conference room and after introductions Eric outlined the challenge they were facing in respect of some of the older imaging equipment in the London sites being out of support, with the supplier unwilling to extend support until Cannon could upgrade. Richard stressed to the German that Cannon had a longstanding relationship for supply of imaging equipment across its sizeable US group. Daniel put forward the suggested solution that Meyer's firm provide a short term support contract for one year at standard cost to allow Cannon to organise purchase of replacement equipment. He pointed out that it was in Meyer's interest to co-operate given the large purchases at stake both for Aviemore's upgrade and the steady programme of capital additions in the US group. Stefan Meyer didn't say, but he knew providing the support contract was a no brainer since it would be funded by Cannon and would help protect future sales to the group. Jeremy added some facts around the dollars budgeted both post acquisition for the UK business and for US hospital group to hammer the point home.

They took a break when the meeting was done, and Allie E mailed Chris for when he came into the office to alert him that the contract would be sent over in the next twenty-four hours and would need reviewing and sending back in double quick time. The Cannon directors and their legal team had taken over the board room for the day and Max brought Allie and Daniel a coffee. He said to Daniel, "So Allie's E mailed Chris, can you mail the accountants on both sides with the proposed numbers we've just discussed so they add them into their documents. Allie can you let the Aviemore legal guys know the details too. Then we need to get together with their legal guys and hammer out the final details around the warranties." Daniel downed his coffee and nodded while Allie was already writing an E mail. She grabbed a quick drink and said, "I'll add the request to discuss the warranties onto the bottom of this E mail and chase if there's no response in the next thirty minutes.

Richard, Ben and Jeremy were watching and Richard said, "Jeremy we need you to lead for us on the warranties from a medical perspective." Jeremy nodded, "Yeah Antonia and I have both been through the data on the historic cases and it's pretty straightforward. The procedures are really limited compared to what we'd deal with at Cannon, elective stuff mainly. The risk gets much less the further out from the deal we go, and the settlements in the UK from the data we have are much smaller than we'd be used to back home.

An hour later they moved into the training room where the Aviemore legal team were based for the next couple of days to discuss the warranty challenges. Allie took the lead on this one and laid out a proposal she'd cleared with Jeremy. "We can totally emphasise with your discomfort with carrying a theoretical risk for the next five years. That said it really is a remote risk since the warranty amount built into the deal is higher than the historic claims, and your liability for any amount over that is capped, so you know the size of the worst case. You guys would only be liable if the warranty amount was exceeded, and it's only for five years. That said, like I say, we can understand this feels uncomfortable, so our suggestion is to introduce a taper relief for each year you move out from the deal." She glanced around and could see this had landed well so she continued, "So what that would mean in practice is that in year two the liability would be eighty percent of the excess claims up to the cap. In year three it would be down to sixty percent and by year five you'd only be liable for twenty percent." She paused and considered how this had gone down. The Aviemore legal team were looking relaxed while the directors were nodding thoughtfully. Allie glanced at Max and added, "Ultimately this is a balance of risk and reward. This reduces the risk for Aviemore considerably, and in reality for it to crystallise there would have to be a very large systemic claim the likes of which has never been experienced in the UK." Jeremy watched in admiration at how she'd turned what seemed like an insurmountable problem twenty-four hours ago into a workable solution. She made it sound as if Aviemore were receiving a sizable and more than fair concession, but Jeremy knew from the numbers Allie had run up on a spreadsheet that in reality it was a small incremental risk for Cannon. Daniel picked up seamlessly explaining how quickly they could draft the new terms in the contracts. Max brought the session to a close, suggesting they took time to digest the proposal, while HRM and Cannon dealt with the imaging equipment support challenge.