You’ve gotten your arms around the basic contracts for your small business but as your company grows, the complexity of the deals and types of agreements may morph beyond existing templates. As you move onto new stages of your business, you may need additional contracts. Here are some examples of contracts you might find necessary, depending upon your industry.
You may be looking beyond salary, medical benefits, and vacation time when attracting talent to your team. Employee ownership is a useful recruiting incentive or as a means to reward existing employees. With an employee stock ownership plan, you can award common or preferred stock (or units for an LLC) to key members of your team, using an agreement between employee and your company.
However, details need to first be set in writing and documents filed with state and/or federal securities officials, all before offering anything to your employees. Securities lawyers are required to assist with the fine points such as whether the stock is granted or offered as stock options to be purchased; how to set a price for the stock options; the vesting period of the stock; and how that stock is affected in the event of termination or sale of the company.
Given everything involved, equity agreements and the setup documents run across several areas of law, including employment, taxation and securities, so they aren’t something to try and create yourself.
All intellectual property (IP) is valuable, but some may offer the potential for you to monetize by licensing to others. Or you may be looking at contracting to use others’ IP for your own business. In either case, some common types of intellectual property licenses are:
Royalties are often used to describe the licensing payments made for the use of the IP. Licensing contracts often set the type and manner of royalty payments as a variable or fixed percentage of the unit or dollar amount of sales or the use of the product created from the licensed IP. The basics surrounding sales and purchase agreements still apply but here and in the next type of agreement, the complexity has increased along with the need for professional advice.
Some engagements or projects, by the nature of the work and the number of other companies involved, require flexibility when it comes to timelines and decisions. Construction projects are an example of contracted work, along with ongoing services type arrangements, that use a master service agreement (MSA). The MSA establishes the contractual relationship with all the terms and conditions that will govern each of the portions of the work, as well as how to resolve disputes along the way.
Having a MSA in place allows for creation of multiple statements of work and captures both the scope details and the timetable. Also, the MSA makes the overall process of negotiating and signing each statement of work easier because the larger issues are already covered by the master terms and conditions.
With any luck your company will be in a growth position where funding is needed to take the business to the next level. There are many aspects to pitching for money and legal advice should be sought early on with respect to your presentations and anything given to potential investors, including the following legal documents:
Given the implications and potential ramifications of running afoul of securities law, offering documents are best left to the steady hand of a seasoned securities lawyer along with support from your business lawyer.
A continued reliance upon solid contracts is critical for companies looking to take big next steps. And the greater complexity is nothing to worry about with LegalShield’s help. Small Business Legal plans offer document review and flat-rate contract drafting up to 25 pages. Sign up today to get started on the contracts you’ll need for your growing business.
An indemnity agreement settles the “who is responsible” question ahead of time. One party promises, in writing, to cover certain losses tied to the work, so the other isn't left with the bill. These promises appear in construction contracts, leases, and business sales.
A certificate of good standing is official proof from your state that your business is registered and current on its requirements. Most lenders and agencies want a recent one, so it helps to know how to get it before someone asks.
Whether the goal is selling a company, bringing in a business partner, or passing it to a family member, the LLC ownership transfer often involves reviewing the LLC's operating agreement and the applicable state's rules.
If you want to do business under a name that isn't your own legal name or your LLC's registered name, you need a trade name, also known as a doing business as (DBA) name.
A consulting agreement is a contract between a service provider, such as an independent contractor, and a recipient.
Hold harmless agreements can help reduce a business's liability by having signatories accept a certain amount of risk.
Getting an LLC in New York generally involves choosing a business name, filing Articles of Organization with the New York Department of State, creating a written Operating Agreement, completing New York’s publication requirement, and handling tax and business setup steps, like getting an EIN.
