Pentana Stanton Lawyers provides expert advice and services in all aspects of commercial law to businesses in Melbourne and surrounding suburbs. Our lawyers have a particular interest in working with small and medium-sized companies to address existing issues and provide sound advice to facilitate growth and expansion.
Our commercial lawyers can advise on:
- Commercial Leases.
- Company structures including advice, drafting of documents and registration with ASIC.
- Shareholder Agreements including interests in unit trusts and subsidiary companies.
- Director Duties including potential liability, obligations and mitigation of risk.
- Investment Structures including share structures, beneficiary shares and investment return arrangements.
- Contracts and contract disputes.
- Financing and options to raise capital.
- Licensing, specifically in relation to property, planning permits.
- Dispute resolution services, including (i) negotiations (ii) round table mediations and other conciliatory processes.
- Litigation, including representation in VCAT, Magistrates’ Court, Federal Circuit Court, County Court and Supreme Courts.
We are committed to finding the most efficient and cost-effective solution so that any delay to your company’s operations are minimised.
Dispute Resolution Services in Dandenong
Businesses are often faced with numerous disputes and litigations related to Trademark, intellectual property infringements, structure-related issues, employment-related laws, debts and property-related issues.
Litigations are both time and cost consuming, not to mention the anxiety and frustration that is often associated with a long drawn out processes.
Our corporate lawyers will act on your behalf for any kind of litigation related to these disputes and protect your business interests. Whether initiating legal proceedings against an offending party or defending you in a dispute, our team of expert commercial litigation lawyers have vast experience in local and Federal Court to give you the best solutions.
Purchasing a Business
Making that leap to purchasing a business, whether this is your first business or one of many is a critical financial decision and one you wish to ensure is done correctly without any bumps along the way. Contracts are often lengthy and important details may get missed. Often you can be overwhelmed with complicated wording and the size of the purchase contract.
PROTECTING YOUR INTERESTS
It’s critical to make sure the agreement to purchase a business includes the major and the minor parts of the agreement. Minute details can be overlooked, and you may not realise this due to lack of familiarity with commercial transactions and contracts. This may result in the business failing to perform as you expected or there may be unexpected or extra costs associated with the business. Ensuring that the purchase is handled professionally will help to avoid nasty surprises down the track.
Here are some tips to help mitigate your risks when purchasing a business before signing the contract:
- Ensure the seller has provided you with the contract of sale, copy of the lease and Section 52 Statement (Vendor’s Statement);
- Review financial records thoroughly;
- Inquire if a performance clause can be added into the contract. This provides for the minimum amount the business should bring in prior to settlement and ensures the business is still performing at a high level;
- Structuring the payment of the purchase price in a way that helps you;
- Ensuring any representations made to you by the seller during the purchase is incorporated as a condition in the contract;
- Inserting a restraint of trade clause which will limit the previous owner from operating a similar business within a certain distance; and
- Knowing all employee’s contractual situations, their employment entitlements and your obligations to them when you take over the business. For example, you may be responsible for their long service leave and other surprises.
EXPERT FINANCIAL ADVICE
Financial due diligence is critical in purchasing a business. You do not want to overpay for a business to only find out later that it is not performing at the level you expected.
It is highly recommended and valuable to seek the advice of an accountant to analyse the financial performance of the business before you purchase it. This advice may save you from investing in an inefficient or under-performing business and will provide you with a more realistic value of the business when it comes to the selling price.
WHY IS THE OWNER SELLING THE BUSINESS?
It is important to ascertain why the owner is selling the business. There may be hidden reasons as to why they cannot maintain the business. This may be due to poor performance, staff issues, licensing and permit requirements. It is important for the previous owner to disclose all information about the business. Failing to ask critical questions like these may leave you in the dark about serious considerations.
Sellers should be open to allowing a trial operational period, introducing you to suppliers and the landlord or real estate agent. If they do not encourage these types of meetings, you should be more on guard about the prospect of purchasing a business from them. Often, sellers who are not forthcoming with their dealings have something to hide. It is best that you either ask further questions about this at that point of time or cease your intentions of purchasing the business.
SEEK GOOD LEGAL REPRESENTATION
Purchasing a business is a thorough and complex transaction. There are potential hurdles and danger signs that an experienced commercial lawyer will identify but which you may miss. A business is a commercial venture that involves significant financial expense, entering into leases, contracts with suppliers, ongoing financial obligations, dealing with staff and other serious obligations. Seeking professional legal advice is critical to ensuring not only the smooth process from the initial investigation of a business, to the completion of a successful purchase, and all that goes in between. Proper guidance and legal knowledge can minimise difficulties and ensure that the financial status of the business, the contractual obligations and therefore financial risk is clear and understood fully prior to finalising the purchase. Leaving this to guesswork or hoping for the best is a recipe for disaster which can affect the future of the business, your family and your personal financial situation. If you are considering purchasing a business consult one of our expert commercial lawyers here at Pentana Stanton Lawyers and have peace of mind for your future business venture.
Call Pentana Stanton Lawyers on (03) 900 22 800 TODAY
A company is insolvent when it is unable to pay its debts when they are due. Causing a company to enter into insolvency arrangements can be caused through (i) the need to avoid insolvent trading because the company is no longer able to pay its debts or (ii) strategically to wind up a failing company and finalize outstanding debts.
There are four types of insolvency, namely:
- Voluntary Administration
An administrator is usually appointed by the company’s directors to take control of the company in an effort to save it. The administrator can determine the assets and liquid value of a company and negotiate with creditors to finalize debts pursuant to the funds available. The terms can include a compromise on the repayment amount or a deferred payment arrangement for outstanding debts.
Once an agreement is reached with creditors, a company deed is entered into binding the company and the creditors to this agreement. This ensures that the company’s debts are finalized prior to the company recommencing operations.
A receiver is appointed by secured creditors to protect the interests and assets of the company’s secured creditors. The receiver’s powers include management of the company as well as the option to take possession of particular assets.
The activities of receivers are regulated under the Corporations Law.
This type of insolvency does not involve trying to save the company. A liquidator is appointed by the shareholders of a company in order to (i) take control of the company (ii) wind up operations and (iii) determine a fair distribution of assets to existing creditors. Once the liquidation process is completed, the company is completely dissolved.
- Schemes of Arrangement
This is a mechanism under the Corporations Law where a company can negotiate a more beneficial situation for both the company and the company’s creditors.
These schemes are becoming less common since the introduction of voluntary administration as articulated in Clause 1 above.
Corporate insolvency can have catastrophic consequences if not managed correctly. It can also be beneficial in some circumstances where a company restructure is manageable.
We provide the following services to shareholders, directors and affected parties:
- Advice on rights and options prior, during and post insolvency.
- Negotiating settlements for voluntary administration or schemes of arrangement.
- Defence against litigation.
- Advice regarding deeds and arrangements.
- Drafting agreements and company deeds.
- Representation at court or in company negotiations.