Author Archives: Aditi

About Aditi

As the current Content Executive for Companies Made Simple, Aditi lives and breathes all things content.

Business Forms: Shareholders Agreement

Share

What needs to be included in a Shareholders Agreement

This Shareholder Agreement is a short-form document which creates a contractual relationship between the shareholders of a private limited company.

This short Shareholder Agreement is designed for private companies in which each shareholder will own an equal share, so that there are no minority shareholders and no majority shareholders. Therefore there is no bias in the Agreement toward one particular kind of shareholder.

The main advantage of a Shareholder Agreement is that in addition to enforcing their shareholder rights against the company under its constitution it allows individual shareholders to enforce their rights under the agreement against each other, providing more protection from the possibility of being squeezed out of the management of the company.

This Shareholder Agreement is intended to be used by shareholders of a Company which is yet to be established or which has only recently been incorporated or purchased “off the shelf” at the time of its execution. It provides for the immediate issue of new shares and, if necessary, the increase of the company’s share capital.

This Shareholder Agreement is well suited to family companies. It sets out the basic elements of the shareholders’ relationship with each other and includes the right to first refusal (pre-emption) for the parties should one shareholder wish to sell their shares, helping to prevent outside investors from muscling in on the company. The more detailed clauses regarding management and share transfers as well as non-competition provisions are excluded from this Basic Shareholder Agreement. For more detailed pre-emption provisions, please see the long version agreements.

We recommend that you use one of the Simply-docs Articles of Association with this Shareholder Agreement. Where other Articles are incorporated caution should be taken for inconsistencies between the two documents. However, as a result of Clause 17 of this Shareholder’s Agreement will prevail over the Articles in the event of an inconsistency.

Also available from the Simply-docs site and listed below under Related Documents are separate clauses which are ready to be incorporated into this agreement if required, including a deadlock provision and a shareholder employee dismissal clause, for use where an employee shareholder is dismissed or resigns.

Square brackets are used to denote optional words and phrases or an either/or choice.

This Basic Shareholder Agreement – New Company includes the following clauses:

  1. Definitions and Interpretation
  2. The Business of the Company
  3. Issues on Completion
  4. Administration
  5. Finance
  6. Financial Information
  7. Issue of Shares
  8. Transfer of Shares
  9. Valuation of Shares
  10. Shareholder Meetings
  11. Company Communications
  12. Management
  13. Reserved Matters
  14. Dividend Policy
  15. Winding Up
  16. Confidentiality
  17. Conflict with the Articles
  18. Duration
  19. Notices and Service
  20. No Partnership or Agency
  21. No Waiver
  22. Severance
  23. Entire Agreement
  24. Non-Assignment
  25. Further Assurance
  26. Costs
  27. Applicable Law and Jurisdiction

Schedule 1: Investment
Schedule 2: Articles of Association
Schedule 3: Loan Agreements

This Basic Shareholder Agreement – New Company is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Shareholders Agreement checklist

The Shareholders Agreement Checklist can be used to help you instruct lawyers, or to help you complete the relevant Agreement.

It lists a range of simple questions (66) to enable you to focus on the principal legal and commercial issues that need to be considered when drafting a Shareholder Agreement including, taxation, investment sums, instruments and timing, security, borrowing, new issues, pre-emption rights and procedures, class of shares, sale of shares and new participants.

Share

Business Forms: Introducer Fee (Single)

Share

Starting up your own clothing line? Here's why you need to trademark it

An Introducer fee for a single transaction tmeplate

This Introducer Agreement (Fee for Single Transaction) is for use where one party (a supplier of a goods or services) wishes to engage another as an introducer of clients or suppliers.

This Introducer Agreement is designed for use where the supplier wishes to secure a contract with only one client, perhaps in a new market or geographical region, who may be specifically identified or not. Where the target client is not named, the Prospective Client Criteria Schedule provides for the supplier to insert any requirements it may have of the new client that the introducer is to find.

An introducer differs from an agent as an introducer does not do any selling of the other party’s products or services themselves, but rather will refer a potential client on, either through simply informing the client of the goods or services provided by the supplier, or by actively passing contact details and so forth on to the supplier of the product. Once the introduction is made, the introducer steps back and will have no further role in the relationship between the supplier and the customer. The selling and supply remains the sole remit of the supplier.

This Introducer Agreement can be set up so as to operate on a fixed fee or percentage basis, with payment upon the introduction itself, upon the first transaction, or both.

If you require an agreement which creates a principal – agent relationship, you should use one of the agency agreements available from the related document links below.

If you require an agreement which is designed for the situation where the supplier is not targeting a specific client or type of client, but is instead seeking new custom generally, you should use one of the Commission or Referral Fee Agreements, available from the related document links below.

The fee clause can be arranged so as to effectively operate as a no win – no fee deal, where, if there is no agreement reached between the supplier and a prospective client, the introducer will not be entitled to a fee.

This agreement has not been created in accordance with FSA rules or the Financial Services and Markets Act 2000, and as such makes no reference or commitment to abiding by them. This agreement therefore is unsuitable for the introduction of clients for financial services, such as insurance products or investment advice.

This Introducer Agreement (Fee for Single Transaction) contains the following clauses:

  1. Definitions and Interpretation
  2. Appointment of Introducer
  3. Method of Introduction
  4. Obligations of the Company
  5. Fees and Payment
  6. Relationship of the Parties
  7. Non Competition
  8. Confidentiality
  9. Non Circumvention
  10. Termination
  11. Nature of Agreement
  12. Notices & Service
  13. Set Off
  14. Jurisdiction

And Schedules:
Schedule 1: Product Schedule
Schedule 2: Prospective Client Criteria

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the agreement.

This Introducer Agreement (Fee upon First Transaction) is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Share

Business Forms: Final Payment Reminder

Share

Composing a Final Payment Reminder

The Final Payment Reminder letter (exc. CDA Interest) follows up the first late payment reminder. It requests payment by return or a written proposal to clear the debt. In the event of either of these two options not occurring the letter informs the debtor that the company may be obliged to take legal action.

Updated and co-ordinated records are essential to effective debt collection. An audit trail of credit related documents will facilitate prompt payment as well as establishing the indebtedness in the event of late or disputed payments and any subsequent legal action.

A number of template agreements are available to document a proposal to settle the debt, and, failing any agreed proposal, a “letter before action” sent to the debtor at the end of the grace period mentioned in this letter.

This Final Payment Reminder template is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

 

Share

Business Forms: Employment Offer

Share

This Employment Offer Letter can be applied to a wide variety of jobs where the employment is on the basis of a Fixed Term.

Enclosed with the Offer Letter should be the Particulars of Employment (Fixed Term Employment Contract).

This template is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Employment Offer Checklist

The Statutory Minimum Employment Agreement Checklist can be used to help you instruct lawyers, or to help you complete a contract of employment with the statutory minimum required terms and conditions of employment.

It lists a range of simple questions (43) to enable you to focus on the principal legal and commercial issues that need to be considered when drafting a Basic Employment Agreement.

Written details of specified particulars of employment must be provided to all employees within two months of starting employment.

Normally these terms and conditions of employment will be provided in the employment contract or in a separate written statement. These minimum requirements are often referred to as a Section One Statement.

This Basic Employment Agreement Checklist template is in fixed field format. Simply press TAB to jump from one field to the next and SHIFT TAB to go back. Alternatively, use the mouse to click from one field to the next.

If you are using Microsoft Office 2003 or older, the template can be unlocked by clicking on the “Padlock” icon on the tool bar. To display the “Padlock” icon click on “View” and then “Toolbars”. From the “Toolbars” menu, select “Forms”.

Users of Microsoft Office 2007 must first click on the “Review” tab to reveal the “Protect Document” button. From the “Permissions” panel that opens, click on the “Stop Protection” button.

 

Share

Business Forms: Consultancy Agreement

Share

Use of a Consultancy Agreement

This Consultancy Agreement is designed for use by a company (rather than a sole trader) whose staff or subcontractors carry out the consulting services. It is drafted in favour of the Provider of the consultancy services and to reflect current best practices.

The equivalent Consultancy Agreement for a Sole Trader or Freelance worker (not using a Service Company) is the Consultant Agreement (medium) – Provider Version.

Where further provisions (including insurance, specific clauses relating to premises and further contractual protection for the parties) are required parties please click on the relevant link at Related Documents below.

This Consultancy Agreement contains the following Clauses:-

  1. Definitions and Interpretations
  2. Appointment of the Consultant and Duration
  3. Obligations of the Consulting Company
  4. Fees and Expenses
  5. Late Payment
  6. Intellectual Property
  7. Termination
  8. Effects of Termination
  9. Confidentiality
  10. Relationship of Parties
  11. No Waiver
  12. Severance
  13. Entire Agreement
  14. Non – Assignment
  15. Notices and Services
  16. Applicable Law and Jurisdiction

Schedule
A. Scheduled Services
B. Time for Completion of Scheduled Services
C. Fees
D. Invoices and Receipts
E. Locations and Premises

Share

Business Forms: Commission Agreement

Share

What is a Commission Agreement?

Use our blog below to craft a commission agreement.

This Commission Agreement is for use where one party (a provider of goods or services) (the”Client”) wishes to engage another to introduce suppliers or customers in order to generate more sales and increase their customer base. The introducer will earn a commission in return for his efforts.

An introducer differs from an agent as he does not do any selling of his Client’s products or services themselves, but rather will refer a potential customer on, either through simply informing him of the goods or services provided by the Client, or by actively passing contact details and so forth on to the Client. Once the introduction is made, the commission earner steps back and will have no further role in the relationship between the Client and the customer. The selling and supply remains the sole remit of the Client.

If you require an agreement which creates a principal–agent relationship, you should use one of the agency agreements available from the related document links below.

This Commission Agreement is designed for use where the Client does not have in mind any one particular customer to target, but rather is simply seeking to obtain new customers and widen its client base, or sell into a new market. If you require an agreement which is designed for the situation where the Client is targeting a specific customer or type of customer, you should use one of the Introducer Agreements, available from the related document links below.

Under this Commission Agreement the commission earner will receive a fee or commission for all transactions that occur between any customer introducer by him and the Client within a set period. This differs from the Refferal Fee Agreement, available from the related document links below, which instead provides for a fee to be earned only in respect of the first transaction between the Client and the introduced customer.

Should the introducer fail to introduce new custom, he will earn no commission. In this respect this is a no win – no fee type agreement.

This agreement has not been created in accordance with FSA rules or the Financial Services and Markets Act 2000, and as such makes no reference or commitment to abiding by them. This agreement therefore is unsuitable for the introduction of clients for financial services, such as insurance products or investment advice.

The Commission Agreement contains the following clauses:

  1. Definitions and Interpretation
  2. Appointment of Introducer
  3. Introduction of Prospective Clients
  4. Obligations of the Company
  5. Fees and Payment
  6. Relationship of the Parties
  7. Non Competition
  8. Confidentiality
  9. Non Circumvention
  10. Termination
  11. Nature of Agreement
  12. Notices & Service
  13. Set Off
  14. Jurisdiction

And Schedules:

Schedule 1: Commission Schedule
Schedule 2: Product Schedule

Optional phrases / clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the agreement.

This Commission Agreement is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

 

Share

10 unique Online-Only Side Hustles for 2024

Share

As 2024 is just around the corner, why not make one of your resolutions this year to start a thriving side hustle. Thanks to the connectivity of the internet, you can find countless opportunities online to earn an extra income or start your own business! We know online businesses are a pretty popular option, so our blog lists fewer ‘odder’ side hustles which can help you tap into a niche market. 

1. Virtual Event Coordinator:

With the rise of virtual events, there’s a growing demand for skilled coordinators. If you have a knack for IT, and people’s needs and have a laptop to hand, being a virtual event coordinator could be right up your street. You can offer your expertise in planning and managing online conferences, webinars, and virtual meetups.

2. Online Language Tutoring:

 If you’re fluent in multiple languages, become an online language tutor. This is a particularly great idea if you’re a student or an expat from abroad. You can teach your native language, or a language you’re fluent in in one-to-one classes through online platforms. Platforms like Fiverr and Superprof connect language learners with tutors for one-on-one sessions.

3. Digital Products Reselling:

If you’re talented with graphic design or ace at Canva you can create digital templates for things like CVs, Social Media template packs or eBook templates and sell them on platforms such as Etsy or Creative Market. This side hustle requires minimal overhead and time and can be quite lucrative. 

4. Social Media Consultant for Niche Markets:

Maybe you have marketing experience, or you’re a social media native. If you are, you can consider specialising in providing social media consulting services for niche markets like pet owners, vintage collectors, or eco-friendly enthusiasts. Tailor your strategies to resonate with specific communities. You can come on board as a consultant and help a business set up a long-term special media strategy. 

5. Remote Fitness Coaching:

If you’re a certified fitness trainer, you can offer your services online. Conduct personalised workout sessions and provide nutritional guidance to clients from the comfort of your home. You can even offer free content on YouTube or TikTok to reach a wider audience and give potential clients a taste of your coaching. Alternatively, online coaching can apply to a lot of professions like dance, yoga or even life coaching! 

6. Digital Real Estate:

Invest in virtual real estate by buying and selling domain names, or flipping websites. With the right strategy, you can turn a profit in the ever-evolving online landscape. You can use tools like Google Trends to help you predict what kinds of website domains may be in demand. 

7. AI Chatbot Developer:

Learn the basics of chatbot development and offer customised solutions to businesses looking to enhance their customer support or automate certain processes. In a similar sense to a social media consultant, you can come into a business that wants to work with AI and want to train their workforce. 

8. Online Dating Profile Consultant:

If you have an eye for matchmaking and dating trends, you mauy enjoy being a dating profile consultant. You can help individuals create attractive and authentic online dating profiles. Offer advice on profile pictures, bios, and communication strategies to increase their chances of finding a match. You can market your business via social media, sites like Fiverr and the dating apps themselves. 

9. Online editing and writing review:

Many authors seek out editors and reviewers to read and provide constructive critique for their writing. This is a perfect side hustle for those who love to read and have related degrees in writing or English. Secondly, you can also help people read and re-write AI-generated content to achieve a human-AI balance. You can advertise these services on Fiverr, UpWork or on social media. 

10. Virtual Interior Design Services:

Tap into the world of virtual interior design. Offer your expertise in creating digital mood boards, floor plans, and design recommendations to clients looking to enhance their living spaces. You can use sites like Pinterest to curate a style and personal mood board for your business and to show your clients what you can do for them. 

Other considerations 

Starting a side hustle requires a lot of dedication and initial time investment. However, the payoff can change your life. Many successful entrepreneurs began their businesses alongside full-time work and study. Why not take the same chance? 2024 could be the year you launched your successful venture and never looked back. 

Legal considerations of having a side hustle 

You may be wondering if there are any legal requirements before you can start a business. There are a few organisational structures to choose from before you begin. 

Sole trader vs Limited company

As a sole trader, you run your business as an individual. You and your business are considered one and the same, which means that you don’t have to create a separate legal entity for your business, as limited companies or partnerships do. This is where the good news comes in – sole traders are not required to register with Companies House!

Whereas, a limited company is a separate legal entity. This means you won’t be personally liable. Secondly, as a LTD your company’s name is protected, you will benefit from having a scalable business model and your company will have the added advantage of being credible. 

Before you begin, our start-up hub is full of great advice from how to file your taxes to how to start employing people. 

Share

News: Chancellor Jeremy Hunt announces Autumn Statement 2023

Share

As we enter the final month of the year, the UK government have unveiled their Autumn statement which announces their plans for spending and tax for the year ahead. This blog will explore what exactly the Autumn Statement is, what the 2023 Autumn Statement has announced and how it affects you as a small business owner. 

What is the Autumn Statement? 

The Autumn Statement is a pre-set plan for how the government will spend their budget for the year ahead, including details of spending on public services such as the NHS or the DWP. It also sets out plans for taxation, which affects the take-home pay and household budgets nationwide. 

What challenges are being faced by the UK Economy right now? 

The UK economy faces a few key challenges right now: 

  • Inflation is still high, in October it was 5.6%
  • Growth has stalled due to constant raises to interest rates
  • The government is borrowing a lot of money and a lot of this money has a huge borrowing cost. 

The general consensus of the statement is that Chancellor Jeremy Hunt has introduced plans to aid the recovery from these three issues. An independent body called the Office for Budget Responsibility will check whether the government’s plans will in fact aid or hinder UK growth. 

What did the Autumn Statement announce? 

There were many additional announcements in the Autumn statement but we have a round-up of the ones which will affect you directly as an SME owner. 

OBR reports a drop in inflation by next year

The OBR forecasts that inflation will drop to 2.8% by the end of 2024, however, the 2% target may not be met until 2025. 

Minimum wage to rise

Jeremy Hunt confirmed that the national minimum wage will rise to £11.44 per hour for those 21 and above. This is the first time 21-22-year-olds will be paid the higher wage, usually, the cut off is from 23. 

This will directly affect you if your small business has employees. As a business owner, you will have to review your employee’s wages and make sure they are aligned with the national wage requirements. 

Tobacco and Alcohol Duty 

Hunt increases duty on hand-rolled tobacco by an extra 10%, however, he freezes the duty on alcohol until August 1st. 

This is good news for bars, restaurants and pubs. However, this can have a negative effect on store owners as the price of tobacco will go up. 

£50 million fund for apprenticeships 

Hunt announces that £50 million will be used over the next two years to increase the number of apprenticeships in engineering and ‘other key growth sectors’.

This may be useful for SME owners who want to take on apprentices or use the apprenticeship scheme currently. 

Additional £500m funding for the AI Sector

The AI sector is expected to receive a funding boost of £500 million over the next two years in order to transform the UK into an ‘AI powerhouse’. 

If your company creates AI or works adjacent to those who do, i.e. you are a PR firm with an AI company as your client, this will have a positive impact on your business and may open up your business to some funding. 

£4.5bn set aside for manufacturing 

Hunt has committed to setting aside £4.5 billion for the manufacturing sector from 2025 to 2030, This is in order to boost our aerospace, life sciences (such as medical research) and green industries. 

Class 2 NI to be abolished 

The chancellor is moving to abolish the Class 2 NI tax for self-employed people, this can save entrepreneurs an average of £190 a year. Now self-employed people earning more than £12,570 a year will pay a flat rate of £3.45 a week. 

Business tax break is now permanent 

Here to stay is the tax break businesses receive from investing in IT, machinery and equipment. For every £1 a business invests in these goods and services, you are able to receive a 25p tax break. 

This is a huge benefit for companies which heavily invest in equipment and tech, such as manufacturing companies. 

Continuing the freeze for business rates.

The government will continue to freeze the small business multiplier for a further year- meaning small businesses will pay lower business rates for this financial year. They will also extend the 75% discount on business rates up to £110,000 discount for hospitality businesses. This may take the pressure of those worried about the rise in minimum wage. 

Hint says this motion can save the average independent pub up to £12,800 a year.

National Insurance rate cut from 12% to 10% 

The employee NI rate will be cut from 6th January onwards to 10%. Hunt says that usually this measure would be brought in in April at the start of the tax year, however, this will be introduced as urgent legislation to help 27 million workers see a benefit from the new year. 

How does the Statement affect you? 

Hunt has remarked that this Autumn Statement is one for ‘growth’. Thousands of people will see the benefits of certain motions such as the NI tax cut. However, the rise in minimum wage will increase the already tight margins for many small businesses, which are already affected heavily by high energy prices and the continued high rate of interest. 

Some industries such as manufacturing, AI and tech, sciences and green industries have a lot to benefit from. The addition of funding from the government can translate into an increase in funding for businesses within these sectors. 

Small businesses nationwide will welcome the continued freeze of business rates and the hospitality industry will benefit from the extended 75% discount. 

Further reading: 

https://www.gov.uk/government/publications/autumn-statement-2023https://www.bbc.co.uk/news/live/uk-67491863

Share

The benefits of using a shelf company

Share

When opting to start a company, many organisations may choose to go down the route of beginning with a shelf company. They are an ideal option for those looking for a company number instantly or if you need to operate as an older company. 

In this article, we will run through the benefits and possible disadvantages of using a shelf company. 

What is a shelf company? 

Shelf companies are essentially ‘ready-made companies’. They are companies that have been incorporated/formed in the past are currently dormant and have never traded. These companies can be bought and begin trading as soon as the transfer of ownership is completed. 

There are a lot of benefits from purchasing a shelf company in comparison to incorporating a brand new company. 

Benefits of using a shelf company.

Your business is up and running quicker 

The most significant advantage of a shelf company is the increased efficiency of formation. Forming a company from scratch does take more time due to the registration and incorporation process. A shelf company is particularly useful for entrepreneurs who need a registered company number right away. 

Instant credibility 

As a shelf company made a few years earlier, due to this it carries the credibility and gravitas of an older organisation. Older companies tend to have the perception of stability and reliability which brand new companies do not. Your shelf company will come with a pre-established corporate history which adds credibility. 

Access to contracts and funding

If you hope to score contracts or funding very early into your business journey, having a company with a corporate history can help. Aged companies may appear more reliable and a ‘better’ bet for funders or partners. For example, if a loan or grant stipulates your company must be one year old, a shelf company can prove it was formed a year or more ago compared to a brand new company. 

 

Disadvantages of using a shelf company 

Of course, there can be a few drawbacks to opting for a shelf company, primarily down to where you may purchase a shelf company form. 

Fewer customisations 

As a shelf company comes ‘ready-made’ it means it comes with a name. This may not be for you if you are aiming to build a strong brand, or already have an established brand which is tied to the name. However, some companies allow you to file for a Company Name Change service allowing you to update your company name and still purchase an aged company. 

Hidden Liabilities 

A few untrustworthy companies may sell you a shelf company with comes with a dirtied corporate history or debt. It is incredibly important to purchase a shelf company with a company that is reputable and has a proven history of selling legitimate shelf companies. 

All of our existing shelf companies are completely safe to buy, with financially clean records and updated filling history. 

Start today

If you’re in need of a ready-made company, which has been established and aged. We can help you. Our shelf companies are regularly updated and we have a variety of names to choose from. Secondly, we can provide you with additional services like a Company Name Change or a Registered Office service to further protect your details. 

Share