If you are running a business or managing a corporation, it is important to engage a professional team to help with the many planned and unplanned events that will arise. Whether you are starting, buying, selling, growing, or planning your business, we can help.
The right business structure is important to support your business and personal goals. Common structures include:
- Sole traders – may be appropriate when starting a small-scale enterprise on your own using an Australian Business Number (ABN). A sole trader is legally and financially responsible for all aspects of the business.
- Partnerships – may be ideal when another person or people are involved in, and contributing to, the business. In such cases debts and losses incurred are shared by the partners regardless of which partner ‘incurs’ the liability.
- Companies – corporate structures can provide some level of protection for directors and officers. The company is a separate legal entity and may enter contracts in its own name. Companies are registered with the Australian Securities and Investment Commission (ASIC) and have ongoing costs and annual reporting obligations.
- Trusts – can assist with asset protection and may provide strategic outcomes when it comes to income tax and capital gains. Trusts are complex however and must be compliant and properly managed to ensure they deliver the anticipated outcomes.
The structure you choose for your business depends on various matters such as the scale of your operations, plans for future growth, the industry in which you operate and your financial and personal circumstances. We can help you choose a structure that fits your needs.
Buying or selling a business
Whether you are buying or selling a business, we can help with the entire process to ensure your rights are protected and that the transaction goes smoothly. We often work with our clients’ tax professionals to ensure that both financial and legal matters are considered. The agreed terms and conditions of sale should be documented in a written contract outlining each parties’ respective rights and obligations and dealing with a range of matters, such as:
- the purchase price, apportionment of goodwill, stock, plant and equipment
- GST and other taxation matters
- transfer of leases, licences, service agreements, etc.
- ownership and transfer of intellectual property such as business names, domain names, trademarks
- employee transfers, offers, redundancies, leave and other entitlements
- training periods, confidentiality and restraint of trade provisions
- representations and warranties
- due diligence, inspections, investigations
Business contracts and licence agreements
No matter what commercial arrangement you are negotiating, it is important to enter a formal agreement. A written contract brings together the essence of the parties’ negotiations, sets out their rights and responsibilities, the scope of services or products to be provided, and contains essential provisions such as warranties, indemnities and liability.
Your business may need a contract for a one-off transaction, a licence agreement, or a suite of standard form contracts prepared for ongoing consumer transactions. Alternatively, you may be considering a contract provided by another party and need legal advice. We draft, review and negotiate all types of business contracts to ensure that you understand your obligations and that the terms are fair and compliant.
Business succession planning and asset protection
Succession planning and asset protection is critical to any business whether it is small, large, family owned or a partnership. If you have business or company interests you should consider proactive ways to manage risk, protect assets and deal with business continuity. This may involve taking out personal and other insurances (for example, buy-sell insurance), and using partnership and other agreements to deal with contingencies such as the retirement or unexpected death or illness of a key business partner.
Succession plans play a key role when transferring a company’s ownership. The plan sets out how the business should be transferred, whether to a family member or sold to a third party. The plan provides transparency and can help minimise financial stress and disputes when changes occur.
Shareholder and partnership agreements
Shareholder and partnership agreements are key to managing the relationship between members of a company or partners of a partnership. These agreements can form part of your overall succession plan and operate like private contracts between shareholders or partners. They set out the rights, obligations and liabilities of each party, and provisions to deal with events that could threaten the ongoing operations of the business if left unresolved.
Shareholder and/or partnership agreements include provisions such as alternative dispute resolution clauses, deadlock breakers, pre-emptive rights, drag-along, tag-along rights, mandatory sale events, share valuation methods and conflict and non-compete clauses.
We provide a range of business services and strategic corporate advice and have partnered with many clients to guide them through the various stages of their commercial journey.