Specialist Services: Legal Compliance Checklist
Ownership structure
- Where is the value in your company and what is the most significant risk to that value? Can this risk be mitigated legally?
- What are the long term plans for the company? Have the shareholders considered their eventual exit from the company (including making provision to transfer shares in their wills)?
- Are you grooming a management team for a buy-out in the future or is the business going to be eventually sold to an outside party?
- Is further investment in the company required? Have you considered how this can be achieved?
- If there are any venture capital investors in the company, are they on track for an appropriate exit?
- Would the company benefit from having different share classes with different rights, perhaps to pay different dividends to different shareholders?
- Is there a shareholders' agreement in force between the shareholders?
- Does the company require shareholder insurance and cross-option agreements to be put in place?
- Would a group structure with different companies dealing with different elements of the business be beneficial?
- If a group structure is in place, are there any companies within the group which are under-performing?
- Are the assets of the business owned by appropriate members of the group?
Intellectual property
- Is the company's intellectual property being exploited to the full?
- If other parties are using your intellectual property, are you receiving royalties?
- Does the company have any trade marks, patents or domain names which could be registered?
- Are there any competing businesses which are using similar names or logos to your business?
Trading relationships
- Does the company have standard terms and conditions of sale and purchase?
- If the company has long-term clients, can they be tied in with long term contracts?
- If the company has distribution or agency arrangements with third parties, are written agreements in place?
- If the business retains commercial agents, are you aware of the obligations on the company when their services terminate?
- Is the company involved in any disputes with third parties which could be resolved?
Staff
- Do your employees have service contracts?
- Do your existing service contracts contain adequate notice periods?
- Are key employees subject to confidentiality and post-termination obligations?
- Is a modern and up to date employee handbook in place for the business?
- Would your employees be incentivised if they were to be given options over company shares?
- If the company has more than 5 employees, has a stakeholder pension scheme been established?
- Are your employees being paid in the most tax-efficient way possible?
- Is the company complying with minimum wage requirements and the working time directive?
- Is the business aware of current anti-discrimination legislation?
- Does the company require key-man insurance?
- Are there any current disputes with employees or has the business suffered problems with employees in the past?
Money, Money, Money
- Is cash flow an issue for the company? Is the company persistently struggling to collect debts as they fall due?
- Will the company require an injection of cash in the future?
- How much security has the company given to creditors?
Premises
- If the company's premises are freehold, who owns the premises? Is the correct documentation in place to record the occupier? Have the correct consents, if any, been obtained?
- Are you aware of the new Disability Discrimination Act and the requirement for the occupier of any premises to accord with that legislation?
- Are you aware of the recent changes to stamp duty and the Land Registry system?
- Are you aware of the changes to simplify the lease renewal procedure?
- Have you taken advice from your accountants in relation to any tax relief for industrial building allowance or capital tax allowances that you may be eligible to claim?
Lee & Priestley intends this list to be a helpful set of suggestions for enhancing and protecting the value of your business. If you feel that any areas of your business could benefit from some legal healthcare, Lee & Priestley provide a full range of corporate and commercial legal services.
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