Sydney Business Lawyers extensive experience in acting as advisers to business empowers it to provide practical and insightful advice about the legal issues that businesses must deal with, including the contracts that they often have to enter. Some of those contracts and the issues that relate to them are set out below.
Partnership / Shareholders’ agreement
The core considerations in such an agreement are voting rights and whether a minority interest holder will be able to influence important decisions, profit distribution, funding requirements, dealing with impasses in being able to do business, voluntary and compulsory exits and dispute resolution.
Buy Sell agreement
These agreements normally deal with the passing of control of a business when a key person dies, is disabled or suffers a critical illness, including the funding of the exit through insurances. It is critical to get not only the document right, but the structure and management of the insurances, otherwise unwanted tax can arise.
Many tenants don’t speak with their lawyer about their business premises lease until after they have done the deal. This can cost money because when the lease issues, it will be on the landlord’s standard terms and more likely than not, if you sell your business and assign your lease mid term, you are still liable for the new owner’s occupation, you will be paying the landlord’s legal fees, you have no rights if the air conditioning breaks down, you have a costly make good obligation when the lease ends, you are required to provide personal guarantees and any incentive can be clawed back. Most things are negotiable, but not after the deal has been done.
Key issues in employment agreements are ensuring you can require your senior employees to work more than the base 38 hour week, protection of IP, dealing with pre-requisites for employment, non compete provisions on exit, copyright issues in work created by employees, in the case of senior staff, extended probation periods, performance measures and termination provisions that minimise your exposure.
Supply of services by the business
Systems to ensure better credit control and enforcement, retention of title provisions so goods not paid for can be retaken, effective charges over property for security of payment, interest for late payment, passing of title, insurance, indemnities and risk are issues that need to be carefully managed under contracts for the supply of goods and services by a business. Spending time and money upfront to get these right can save a lot of money when a customer does not pay up.
Supply of services to the business
Ensuring that IP rights are clearly understood, the basis of calculation of payment and timing, clearly setting out what the business is to receive and when, copyright, non performance and termination rights and dispute resolution are core areas that often see businesses lose money when a third party supplies goods and services to a business.
Sale contract when selling the business and doing the heads of agreement
Getting a lawyer after the deal has been done can create problems if the implications of the agreed terms are not clearly understood. If you get a lawyer involved from the outset it can mean that party expectations are managed and aligned from the opening negotiations, important issues don’t have to be reworked (which can prejudice a deal) and it can save time and money, including by getting to settlement faster.
If you need any help with these and your other business contracts, please contact Sydney Business Lawyers on 8915 4900 or firstname.lastname@example.org.