Business & Leasing Law
Whether you are purchasing or selling a business, starting your first venture, or are an experienced entrepreneur requiring assistance in settling complex joint venture agreements, we can assist you through every step of the process.
It’s not just about the transaction; As they say, the devil’s in the detail, and KPA Lawyers prides itself on providing a high-end service that takes your interests seriously.
During the COVID-19 pandemic, KPA Lawyers has stayed on top of the issues which affect our clients, providing support and information for sole traders, small, medium and large businesses regarding their rights and obligations within the everchanging landscape. We have guided our clients through enquiries regarding JobKeeper and rental reductions and have provided the business community with up to date resources during every stage.
We can assist you with:
- Purchasing or selling a business or franchise
- Drafting, reviewing or transferring a Lease/Sub-Lease;
- Setting up your business structure, trust, partnership or company
- Shareholder disputes
- COVID-19 practices, changes and JobKeeper issues
- Lease negotiations and review
- Assistance with licensing applications including liquor licenses
Q: What is “due diligence” when buying a business?
Due diligence is exactly what it sounds like – making the necessary enquiries and investigations to get a full understanding of the position of the business, its financials, outgoings, management and circumstances of its operation. The business should not only be viable financially, but it should be suitable to the abilities, interests and financial capacity and need of the intending purchaser.
Due diligence enquiries include:
- verifying the financial information provided by the seller of the business, which can include bank statements and financial records;
- speaking with staff and suppliers of the business;
- reviewing the contracts held by the business;
- ascertaining the customers of the business.
The seller of the business may require the intending purchaser to sign a confidentiality agreement prior to disclosing information about the business to the intending purchaser.
Q: Do I need a Licence to run a business?
It depends on the type of business you intend to run. Many licences are concerned with the specific type of business and the use of premises for particular activities, as well as their suitability for such use (e.g. bars, restaurants, medical centres) but some licences also deal with the licensee’s suitability in conducting the activity.
Some licences have no particular or special value and are routine, requiring only the payment of an annual fee. Other licences are valuable and form a substantial part of not only the business but the value and operation of the business (such as liquor licences). Applying for and being approved for those licences can take time and require additional accreditations (such as having Responsible Service of Alcohol training).
Advising you about the licensing process is part of the service we provide when conducting your business purchase.
Q: What happens to staff entitlements when I purchase or sell a business?
When a business is sold, the purchaser usually has a right to select which of the existing employees of the business the purchaser wishes to retain.
Any employee that is not re-employed by the purchaser must be paid out his or her entitlements by the Vendor. Vendors need to be aware that they may become liable to payout employees who are not re-employed by the purchaser, including any annual leave, long service leave, and potentially redundancy or severance payments.
The entitlements of the employees who are re-employed by the purchaser will usually carry over and are maintained which means that the purchaser can be liable to pay the employees for any annual leave and long service leave accrued before they took over the business. Therefore, as part of negotiating the purchase of a business, the vendor and purchaser need to discuss how this is going to be dealt with and how it will be adjusted in the purchase price or at settlement, and have the terms of that agreement incorporated into the Contract of Sale.
Depending on the circumstances of the employees and the business, there are various considerations to take into account when dealing with employee entitlements and you should ensure you discuss them with your solicitor.
If you’re about to begin, purchase or sell a business, our solicitors will be able to guide you through the process and advise you on how to best deal with the various issues that might arise. Contact us for a preliminary conversation about how we can assist you.