Certain documents are important to your business because they protect your firm’s assets and interests over the company’s lifetime.
Do know about all these document types and do you have yours completed and readily accessible?
Read on to learn about the most critical document types most businesses need and find out which is needed in your particular case.
1 – LLC Operating Agreements
Not all US states require operating agreements for LLC (Limited Liability Company), even when there are multiple owners. Still, experts urge business owners to have written LLC operating agreements – most especially when there is more than one member. And they more strongly urge this if those members are family.
This document should define how important company decisions will be made; distribution of profit and losses; member’s roles, rights, and responsibilities, and procedures for member departure. Once this document is prepared and all members have signed it, this becomes your legally binding contract.
2 – Non-disclosure Agreement
You may not realize it but your company has proprietary information, often referred to as trade secrets, that must remain private in order for your firm to maintain its current business operations.
The most common types of data are customer lists, records, marketing strategies and product recipes. Implementing NDA (Non-disclosure agreements) is a good first step in protecting this confidential information. When both parties, such as the business and its; employees, customers, vendors, and partners, sign this document it becomes a legally confidential relationship in the eyes of the law.
3 – Business Plan
While your business plan is not a legal document, it is a vital component to obtain financing or sell your business. As such it is an important record in your business library.
4 – Corporate ByLaws
If your company’s business structure is a corporation, either a Type-S or Type-C, most US states will require that you keep a written set of bylaws, whether or not they are required to file with the state business office.
Regardless of your state’s filing requirements, it is wise to create and retain this document.
Include in the instrument such information as individual roles of top management, owners, and partners along with governance issues. The best corporate bylaws include the length of board directors terms and whether decisions require a simple majority and other standard practices.
5 – Meeting Minutes
The majority of states require that corporations document their meetings in written minutes. This official account logs what was discussed, decisions made, those in attendance and actions taken.
Retaining these registers can help settle any future disputes about what was decided or occurred at prior board meetings.
Be certain to make your minutes detailed enough to serve as your “institutional memory”. Cover all the following: meeting type, place, time, attendance, actions, and votes, including the exact vote of each board member.
6- Online Privacy Policy
If your website gathers any information (such as email addresses or survey opinions) from your customers or site visitors you must post a detailed privacy policy on your site. This document describes how this data will be used and protected.
7- Online Terms of Use
It is prudent to draw up and post your terms of use statement on your official website. This report limits your risk for situations where there are errors in your website content such as prices, guarantees, and information.
In addition, include explanations of your lack of responsibility for hyperlinks to other sites not owned by your company. Tell your site visitors what they can and cannot do on your site, which is especially important for sites where comments, sharing and blogs are present. This is critical in today’s hypersensitive social media world.
8- Employment Agreement
To help minimize future disagreements this employment contract details the obligations and assumptions of both the employee and the company.
You don’t need a detailed contract for every hire, but you should for those positions with managerial roles and those with access to critical sensitive data. Since those people will have access to confidential information, that is critical to the firm’s competitive edge you need to be sure it will not be shared with to your competitors.
Use an experienced employment lawyer to review this contract before you have your new employee sign to be sure it is well written and legally valid.
9- Memo of Understanding – MOU
This document is less than a formal contract, but more than an oral agreement or handshake deal. It puts on record your conversations with key suppliers, business partners, investors and other business associates about key initiatives.
These easy to draft and non-intimidating for others to sign are great documents to use for laying out project details and relationship guidelines. While not always legally binding in all states and circumstances, they are useful to formalize casual agreements quickly.
10 – Apostille
If your company is involved in international trade with other Hague Conventions nations you might need a special certificate called an “apostille”. This instrument is your authentic public document, akin to an article of incorporation, which is recognized internationally. Know that these certificates are only valued in Hague Convention countries.
Luckily, you don’t need to write all these documents yourself. Here are a few legal templates to get you started. Business2Community readers can save 10% on all legal services with this Legalzoom promo code BEST4B18.
After you have customized them to meet your particular business details hire an experienced business attorney to review them before you either file them with your state or ask your employees, vendors, customers, and investors to sign them.