The restructure depends on customer contracts that need separate legal review
Identify contract-specific notice, consent and performance dependencies in an early restructuring option before assuming forecast customer work continues unchanged, without prescribing termination or ipso-facto rights.
Corporate Recovery Partners
01 / 06
The forecast assumes the contracts continue
An early restructuring proposal looks workable because existing customer jobs are expected to fund the recovery. Ask the legal adviser to review whether the proposed changes affect those contracts. A financial model can assume uninterrupted work while a contract contains relevant consent, notice or performance requirements. The answer needs the actual documents and applicable law, not a general belief that restructuring either protects or ends every agreement.
Tell the lawyer whether the option involves new funding, an ownership change, a business transfer or a formal appointment. Provide the contracts and amendments for the material jobs. Do not describe every option simply as a restructure; the legal and operational questions may differ. Identify the specific revenue assumptions depending on continued performance.
Business.gov.au recommends clear contractual terms and professional help where terms are not understood. Ask which provisions require assessment and whether relevant law affects their operation. This article does not say a counterparty may terminate, that consent is always needed or that any clause is enforceable. Those conclusions require advice on the particular arrangement.
Imagine the rescue proposal assumes a major contract moves with an operating division. The contract documents contain a provision concerning assignment, and the customer's position is unknown. The financial forecast should identify that dependency rather than treating the transfer as completed. Have the lawyer assess the process before approaching the customer or promising that the work will move unchanged.
Record any conditions, timing uncertainty or additional work identified by advisers. Keep the existing forecast and a clearly labelled alternative if continuity remains unresolved. Do not remove revenue arbitrarily or retain it as certain merely because the business needs it. Ask how the dependency affects the practical comparison between options and the time available to decide.
Agree who may contact customers and what information can be given accurately. Retain any required written confirmation with the relevant contract. The purpose is to make the rescue forecast reflect a legally reviewed operating pathway, so expected customer work rests on supported assumptions rather than an unnoticed contractual gap.
