write a detailed IRAC analysis with references and oscola notes from modern law review, tolley's tax, jornal of business law, HMRC website

Horatio recently incorporated as a private limited company. Horatio is the sole director and shareholder, owning 100 1 ordinary shares in the company. Horatio started the company with 200,000 start-up capital. There has been considerable interest in the electric road bikes the company manufactures and Horatio wishes to grow the business. He has been in talks with former professional sportsman Carl Cavendish, who wishes to invest 200,000 in the company in return for a significant shareholding. He has indicated that he wishes to be involved in the running of the business and that he would like to see a return on his investment each year. Carl has also offered a loan of 500,000 to enable the company to purchase a property from which to manufacture the bikes and to operate as a stock warehouse and sales depot and 600,000 to purchase a new state of the art manufacturing machine. He would like to secure the loans and has suggested fixed charges over the building and bike stock.

Question 1: Consider the issues that Horatio should consider in relation to the proposed investment and loans from Carl.

Eco-Wheels Limited ('EWL')

EWL is a private limited company that Horatio established in 2014 which manufactures and supplies an electric mountain bike, the E-Mount, that uses solar-charging technology. Horatio is the sole director and shareholder of the company. In 2019, to fund a major expansion into the European market, EWL, entered into the following agreements, all of which provided for interest plus lump sum repayments at the end of the term of the loan:

A ten-year loan of 1 million from East Bank, created on 1 December 2019. Clause 6 of the security document provides for 'security by way of a fixed charge over the chargor's current and future book debts'. The security was registered at Companies House on 10 December 2019. The terms of the security document require that all book debts be paid into EWL's current account with East Bank, and that EWL is free to draw on the account until such time as a crystallisation event occurs.

A five-year loan of 500,000 from South Bank, created on 3 December 2019. This is secured by a fixed charge on a state of the art machine which makes the E-Mount bike (the 'Machine'). The charge was registered by EWL on 20 December 2019.

A seven-year loan facility for 300,000 with West Bank, secured by way of fixed charge over the Machine. This security was created on 10 December 2019 and registered by West Bank on 15 December 2019.

A three-year loan agreement with North Bank for 4 million, created on 20 November 2019, secured by way of floating charge (registered on 3 December 2019) over the stock of E-Mount bikes.

Uncertainty caused by Brexit and Covid have seriously impacted EWL's viability in Europe, with large retailers in Spain and Italy pulling out of deals. EWL currently has stock worth 2 million in its warehouse. The Machine is currently worth 700,000. EWL's current account with East Bank currently has a balance of 1,100,000.

Question 2: Advise Horatio as to the order in which the securities would rank in the event of the insolvency of EWL and how much money each creditor would be able to recover by virtue of its security.

Small-Wheels Limited ('SWL')

SWL is Horatio's third company, which he established in 2014 and of which he is the sole director and shareholder. SWL manufactures and supplies folding commuter bikes. Horatio started the company with share capital of 40,000 and the company is now valued at 1 million. Horatio wishes to transfer the company to his daughter, Meredith, who has worked for the company since its inception.

Question 3: advise Horatio in relation to the taxation consequences of his proposal and the most tax efficient options available to him.

Word count 4,000 words.