The business world revolves around contracts. Owners who value their time know the ease and peace of mind that a contract attorney can bring to the table. Experienced contract lawyers take the guesswork out of creating an agreement, working tediously and tirelessly to provide their clients with adequate legal protection spanning any and every scenario imaginable.
Many of the most common business agreements are more intricate than you may realize. Instead of using a template and potentially leaving your business subject to damaging loopholes, consider hiring a legal professional to consult with you, identify critical legal language meant to protect you and your business, and ensure your agreements are clear and concise terms in order to avoid disputes. Business attorneys well versed in contract law are able to assist in the development of many different types of agreements, including:
1. Indemnity Agreement
“Indemnity” can be defined as “protection against loss,” and is applied in contract law to hold a party “harmless” in the case of damage, injury, burden or any other liability. The indemnitee is the party seeking protection, and the indemnitor is the party agreeing to minimize harm to the indemnitee. Indemnity can be written as a clause in an overarching contract or as a separate contract entirely. Exclusions are extremely important to include, mainly to cover negligence and fault by the indemnitee.
2. Operating Agreement
An operating agreement outlines the functions, finances, and framework of an LLC. Because this document includes ownership percentages, management, distributions, owner exits, and many other details, the owner(s) are best served to engage a lawyer, whether to create the agreement, facilitate business formation or transfers with an existing agreement, or all of the above. Established business law firms like Gehres Law Group, P.C. can also provide LLCs with valuable consultancy on an as-needed basis. Learn more about LLC operating agreements in this article.
3. Licensing Agreement
Many businesses seek to license their trademark, granting rights to other businesses or individuals for various uses such as advertising, partnerships, and sponsorships. While licensing can drive revenue and brand awareness, royalties can be uncertain, and there is always a level of trust placed in the licensee to apply the trademark properly and maintain a positive light. Even the most standard licensing agreement is relatively complex, with many elements that must be reviewed thoroughly before making the trademark available to a licensee.
4. Service Agreement
Business-to-business (B2B) and business-to-consumer (B2C) companies alike use service agreements to quickly and repetitiously provide both assurance to clients and protection for themselves. As frequently as a service agreement is used, it is wise to consult a contract attorney to ensure your document contains key provisions, such as disclaimers, is appropriate for your business model, and is enforceable if challenged.
5. Purchase Agreement
When a buyer and seller enter a transaction involving stock, real property, or other assets, they will usually sign a purchase agreement stating the terms of the sale. There can be many provisions and contingencies in a purchase agreement, and oftentimes, this document will require several reviews before the two parties agree to terms. A Letter of Intent may or may not precede the drafting of a final purchase agreement, which is typically a comprehensive writing containing all of the terms of a purchase, often with one more addendum incorporated in the purchase agreement.
6. Joint Venture Agreement
A joint venture can be an extremely rewarding engagement when two companies find an impactful way to join forces. But, behind every brilliant joint venture idea is a web of legal considerations, including but not limited to ownership, operations, intellectual property, finances, and conflict resolution. A joint venture agreement thoroughly outlines these factors so that both companies know exactly what they are getting into and what to expect from the venture.
7. Partnership Agreement
There are several critical steps to take before forming a partnership, the latter of which is to draft and negotiate an agreement. While not required by California law, an agreement is necessary to avoid potential disputes or lawsuits. There are many partnership agreement templates online, most of which can serve as a solid starting point. However, it is still best to hire a business lawyer during this process, as every partnership will have unique terms regarding distributions, contributions, decisions, and many other inner workings of the entity, which are often overlooked by do-it-yourselfers.
8. Employment Contract
Employment-related contracts span the full gamut of operations, from full-time employee agreements that include confidentiality and nondisclosure terms to consultant, contractor, stock option, and commission agreements. Employment law in California is extremely broad and complex. In many cases, we uncover that business owners who have not had their employment agreements drafted or reviewed by an attorney are unknowingly vulnerable to risks surrounding employee treatment, performance reviews, wages, raises, and termination.
9. Commercial Lease
Most businesses require some sort of office space to serve as headquarters for company operations and full-time staff. Enter the commercial lease, which can be notoriously nuanced and lengthy. Between negotiating, understanding, and executing this agreement, the input of time and energy can be exhausting for the owner or executive tasked with securing the space. That’s not to mention the risk of agreeing to unfavorable fine print if a lawyer skilled in business law, contract law, and real estate law is not involved.
10. Equipment Lease
When a company is leasing equipment such as machinery, vehicles, or workplace technology, it’s important for the business leaders to seek flexibility and scalability in the contract terms. Equipment leasing also has an impact on finances and business strategy. As such, an equipment lease should not be glossed over, as it will likely require at least some degree of negotiation and/or discussion to ensure the terms are as favorable as possible to your company.
This is only a small handful of the agreements that the San Diego business attorneys at Gehres Law Group, P.C. can advise on, draft, negotiate, and enforce. More than simply providing legal expertise, we are passionate about helping businesses sustain and thrive with reliable legal counsel. Learn more about our contract law services, and contact us to schedule a free complimentary consultation on any aspect of business law.