Small and midsized businesses are often anxious about legal risks, and need affordable solutions. Strong contracts are key to avoiding unnecessary, costly disputes, and solidifying relationships with customers and vendors. Here are five tips for great deals.
One and Done: It’s often a good idea to create a “master services agreement” that explains all of the legal terms that govern your relationships. That contract may be “evergreen”, and last indefinitely. Work orders are a great way to update business focused issues like ongoing deliverables and deadlines without re-opening the full contract.
The Price is Right: A key reason to enter a contract is to ensure that you and your customer or vendor have agreed upon the scope of work, pricing and payment terms. Clarity about those issues helps avoid disputes.
Protect Your Assets: Intellectual property like trademarks, copyrights, software code, inventions, and trade secrets (such as customer lists and profit margins) all provide competitive advantage. Be clear about what’s yours, as distinct from what belongs to your customers and vendors. And agree that everyone will keep confidential information a secret.
Hold Me Harmless: “Indemnifications” help protect your business from the cost of risks that you didn’t create. If you’re sued without merit, it’s good to have a “hold harmless” provision that limits your defense expenses.
Fight on Your Home Turf: Good contracts help limit the risks of disputes and litigation. But, if there must be a legal fight, you may want to ensure that Georgia law will govern, and to limit costs, require that local courts hear the case.
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This article was also published in the March 2016 issue of the Gwinnett Citizen newspaper.
JoAnn Holmes ("Jo") is the founder of HOLMES@LAW, LLC. She serves as Outside General Counsel to select, intimate management teams for midsize companies. Likewise, Jo provides strategic support for lean law departments.
Jo founded HOLMES@LAW to provide agile, result-driven legal solutions. Beyond risk management, we help identify opportunities. The firm's focus areas are business law and strategy, commercial contracts and global intellectual property management. We build long-term relationships as trusted collaborators, and our flexibility consistently yields great value for clients.
HOLMES@LAW is also committed to service work, including through supporting local schools and leadership groups, as well as domestic and international charities. Since its founding, the firm has dedicated more than 200 hours to community service.
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