In today's Freedom Friday blog and email newsletter, I want to talk about something in general that comes up with a lot of clients, and that's the kinds of contracts they need or should expect in their small business.  Sometimes I get asked, “Okay, I have my LLC, what contracts do I need?”  That's a difficult question to answer, because every business is different, and different businesses need different kinds of contracts, depending on the type and size of the business.  So, in today's Freedom Friday blog and email newsletter, I'm answering the question, “What are common business contracts in Oklahoma.”

There are three different categories of business contracts which are common in Oklahoma:

1.  General Business Contracts

The first category of business contracts which are very common in Oklahoma are general business contracts, and this includes the LLC Operating Agreement you should have signed with your business partner(s), and several other kinds of contracts.  If you are in business with a co-owner, the very first contract you need is an operating agreement for your LLC, or if you incorporated a set of bylaws for your corporation.  If you are in an actual partnership, you need a partnership agreement.  Each of these agreements will outline the terms of the relationships, including what duties and responsibilities are required (e.g., contributions, etc.), how profits will be shared, how the business will continue after the death of one of the owners, etc.  Another general business contract which many businesses encounter is an equipment lease.  If you're renting space or equipment you will need to sign a lease, and you may need to provide a personal guaranty on the lease.  Equipment leases and similar contracts provide terms such as monthly payment, required deposit, usage rules, and what happens under a default.  Also, sometimes you will encounter a nondisclosure agreement (NDA).  While this is very common with employees and independent contractors, it can also be common for business partners, vendors, and other relationships.

2.  Employment Contracts

The second category of business contracts which are very common in Oklahoma are employment contracts.  If your small business has grown to include employees, or even independent contractors, then you need to have employment contracts.  For small businesses, the most common type of employment contract is an independent contractor agreement.  If you're hiring someone for contract work, not making them a permanent employee, and giving them a 1099 instead of a W-2, an independent contractor agreement is needed to document such a relationship.  You also might wish your employees and/or independent contractors to sign a nondisclosure agreement (NDA) which will prevent them from sharing trade secrets or other confidential information they may have learned from your business.  Also included in this category is a general employment agreement, or more frequently a policies and procedures manual which details an employee's pay, bonuses, benefits like medical insurance, paid time off policy, overtime pay policy, specific grounds for termination or other disciplinary matters, and more.  If you're considering creating a policies and procedures manual, you definitely should consult with a business attorney to assist you.

3.  Sales Contracts

The third category of business contracts which are common in Oklahoma are sales contracts.  One example of a sales contract is a bill of sale, which transfers ownership of a property from one person or company to another and can be used for vehicles and heavy equipment.  Another example of a sales contract is a purchase agreement which is typically used to order a large item or items in bulk.  A purchase agreement will outline what item(s) are being ordered, payment, and delivery terms.  Lastly, a security agreement as part of a loan agreement is also common, and a security agreement will pledge an asset or personal property as collateral which is the security for the loan.  You will most often enter a security with a lender such as a bank or with another business who is willing to loan your business money.

Thinking about starting a small business?  Or maybe your small business is having issues with contracts, leases, business partners, collection issues, or experiencing other barriers to growth?  Please contact me at [email protected] to schedule a FREE strategy session.

For more information about Liberty Legal Solutions, LLC, please visit our website at http://www.libertylegalok.com/