I have a cast study where an individual is selling her business which she owns 100% of the shares in. She enters into a contract with 'Business B' (BB) for transfer of the shares ($2.8 million) to with an initial upfront payment of $2m with the remaining $800,000 (the deferred payment) to be paid in monthly instalments with dates specified in the contract. The share sale and purchase contract (SSP) provided the following:

(Restraints) The seller will not compete with the purchaser of the business in relation to

the business of online gambling anywhere in Australia or New Zealand for 10 years.

(Seller Warranties) The seller warrants that upon the date of completion (handover of

control) any updated list of liabilities and the updated debtor list will be provided to the

purchaser with relevant adjustment to the deferred payment amount.

The sale and purchase agreement also provided that in the event there was a late payment of the deferred payment by more than seven days that the Restraints and the Seller Warranties would be void and the Deferred Payment became immediately due and payable in full. On the 1st June 2021 the seller handed control of her business over to BB (the initial up-front payment was made in full). The second instalment of the deferred payment was to be made on the 1^st August 2021, however BB did not transfer any of the monies to the seller's account until the 10^th August 2021. The seller wants to now rely on the late payment clause and sue for the remaining $750,000 due under the contract. BB wishes to argue that the Restraints and Seller Warranties are not void because the seller failed to deliver the updated list of liabilities and updated debtor list on the date of completion, and that the seller must still fulfil her obligations under the contract as the late payment clause amounted to a penalty.

Can you please help advise BB about the legal character of the terms in the contract and if BB can successfully show that the clause is a penalty.