Legal forms for starting & running a small business

497 Pages·2018·55.207 MB·English

by  Fred S. Steingold

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With
Downloadable
FORMS
10TH EDITION
Legal Forms
for Starting & Running a
Small Business
65
Essential Agreements,
Contracts, Leases & Letters

Attorney Fred S. Steingold, author of the bestselling,
Legal Guide for Starting & Running a Small Business
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LOS ANGELES TIMES
10th Edition
Legal Forms for
Starting & Running
a Small Business
Attorney Fred S. Steingold
LAW for ALL
TENTH EDITION MARCH 2018
Editor BETSY SIMMONS HANNIBAL
Cover Design SUSAN PUTNEY
Production SUSAN PUTNEY
Proofreading IRENE BARNARD
Index UNGER INDEXING
Printing BANG PRINTING
ISSN: 2164-3946 (print)
ISSN: 2332-7030 (online)
ISBN: 978-1-4133-2486-0 (pbk)
ISBN: 978-1-4133-2487-7 (epub ebook)
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About the Author
Fred Steingold passed away in 2017. He practiced law for over 40 years in Ann
Arbor, Michigan where he was well-known and highly regarded by the local
legal community. Fred wrote and updated several best-selling titles for Nolo,
including Legal Guide for Starting & Running a Small Business and The Employer’s
Legal Handbook, which continue to be updated and published by Nolo. Over
the 25 years that Fred wrote for Nolo, he worked with many editors and other
Nolo employees, and he always graciously thanked them for their enthusiasm
and assistance. We appreciated Fred’s commitment to his work, his professional
competence, and his kindness. We will miss working with him.

Table of Contents
Your Small Business Legal Companion .................................................................................1
Four Practical Ways to Use the Forms in This Book.........................................................................3
Do You Need a Lawyer? ...................................................................................................................................5
1 Contract Basics .............................................................................................................................................7
Names Clause: Identifying the Parties to a Contract .......................................................................8
Signature Clause: Signing a Contract........................................................................................................9
Standard Clauses ...............................................................................................................................................16
Resolving Disputes ............................................................................................................................................19
Attachments ........................................................................................................................................................21
Amendments .....................................................................................................................................................23
2 Forming Your Business ........................................................................................................................27
Form 2A: Checklist for Starting a Small Business............................................................................30
Form 2B: Partnership Agreement ...........................................................................................................38
Form 2C: Preincorporation Agreement ................................................................................................45
Form 2D: Corporate Bylaws........................................................................................................................50
Form 2E: Stock Agreement ..........................................................................................................................55
Form 2F: LLC Operating Agreement for Single-Member LLC ..................................................58
Form 2G: LLC Membership Certificate .................................................................................................62
Form 2H: Stock Certificate ...........................................................................................................................63
3 Running Your Corporation .............................................................................................................65
Form 3A: Notice of Shareholders’ Meeting ........................................................................................68
Form 3B: Notice of Directors’ Meeting .................................................................................................70
Form 3C: Shareholder Proxy ......................................................................................................................72
Form 3D: Minutes of Shareholders’ Meeting ....................................................................................72
Form 3E: Minutes of Directors’ Meeting ..............................................................................................74
Form 3F: Minutes of Telephone Conference Directors’ Meeting ............................................76
Form 3G: Consent of Shareholders ........................................................................................................77
Form 3H: Consent of Directors .................................................................................................................78
4 Borrowing Money .....................................................................................................................................81
Understanding Promissory Notes in General ...................................................................................82
The Promissory Notes in This Chapter .................................................................................................86
Form 4A: Promissory Note (Amortized Monthly or Annual Payments) ...........................88
Form 4B: Promissory Note (Balloon Payment) .................................................................................91
Form 4C: Promissory Note (Interest-Only Payments) ..................................................................92
Form 4D: Promissory Note (Lump-Sum Payment) ........................................................................94
Form 4E: Security Agreement for Borrowing Money ...................................................................95
5 Buying a Business ...................................................................................................................................101
Form 5A: Contract for Purchase of Assets From an Unincorporated Business............104
Form 5B: Contract for Purchase of Assets From a Corporation ...........................................116
Form 5C: Corporate Resolution Authorizing Sale of Assets ...................................................118
Form 5D: Contract for Purchase of Corporate Stock .................................................................119
Form 5E: Bill of Sale for Business Assets .............................................................................................122
Form 5F: Seller’s Affidavit—No Creditors .........................................................................................124
Form 5G: Security Agreement for Buying Business Assets ......................................................127
6 Leasing Space .............................................................................................................................................131
Form 6A: Gross Lease ...................................................................................................................................133
Form 6B: Net Lease for Entire Building ...............................................................................................141
Form 6C: Net Lease for Part of Building ............................................................................................143
Form 6D: Sublease .........................................................................................................................................149
Form 6E: Landlord’s Consent to Sublease .........................................................................................154
Form 6F: Assignment of Lease ................................................................................................................156
Form 6G: Notice of Exercise of Lease Option .................................................................................158
Form 6H: Extension of Lease ....................................................................................................................159
Form 6I: Amendment to Lease ...............................................................................................................161
Form 6J: Attachment to Lease ................................................................................................................162
7 Purchasing Real Estate ......................................................................................................................165
Beware of Possible Environmental Problems ..................................................................................167
Form 7A: Contract to Purchase Building ...........................................................................................169
Form 7B: Option to Purchase Building ...............................................................................................178
Form 7C: Contract to Purchase Vacant Land .................................................................................181
Form 7D: Option to Purchase Vacant Land ....................................................................................183
Form 7E: Attachment to Real Estate Purchase Contract .........................................................185
Form 7F: Amendment of Real Estate Purchase Contract .........................................................186
Form 7G: Removal of Contingency ......................................................................................................187
Form 7H: Extension of Time to Remove Contingencies ...........................................................188
Form 7I: Exercise of Option to Purchase Real Estate ..................................................................189
8 Buying, Selling, Manufacturing, Renting, and Storing Goods ...................191
Form 8A: Sales Contract (Lump-Sum Payment) ...........................................................................192
Form 8B: Sales Contract (Installment Payments) .........................................................................196
Form 8C: Bill of Sale for Goods ...............................................................................................................199
Form 8D: Security Agreement for Buying Goods .........................................................................201
Form 8E: Contract for Manufacture of Goods ...............................................................................203
Form 8F: Equipment Rental Contract .................................................................................................205
Form 8G: Storage Contract ......................................................................................................................208
Form 8H: Consignment Contract .........................................................................................................210
9 Hiring Employees and Independent Contractors ..................................................213
Form 9A: Employment Application .....................................................................................................216
Form 9B: Authorization to Release Information ...........................................................................218
Form 9C: Offer Letter ..................................................................................................................................219
Form 9D: Confidentiality Agreement .................................................................................................220
Form 9E: Covenant Not to Compete ..................................................................................................223
Form 9F: Contract With Independent Contractor ......................................................................225
10 Extending Credit and Getting Paid ......................................................................................233
Form 10A: Credit Application for an Individual Customer .....................................................234
Form 10B: Adverse Action Letter ..........................................................................................................236
Form 10C: Credit Application for a Business Customer ...........................................................238
Form 10D: First Collection Letter ..........................................................................................................239
Form 10E: Second Collection Letter ....................................................................................................239
Form 10F: Third Collection Letter .........................................................................................................240
Appendixes
A How to Use the Downloadable Forms ..............................................................................241
Editing RTFs .......................................................................................................................................................242
List of Forms .....................................................................................................................................................243
B Forms .................................................................................................................................................................245
Index
.............................................................................................................................................................................473