Contract Negotiation and Drafting

CONTRACT NEGOTIATION AND DRAFTING

Contracts dictate the terms of all business transactions and professional relationships, ranging from dress code for employees to the responsibilities of business partners to the leasing of commercial space and equipment.  By establishing guidelines, providing clarity, and illuminating the path toward the successful completion of projects, clear and enforceable contracts benefit all types of employers and business owners.

Unfortunately, contracts and agreements are not always easy to prepare or interpret.  Boilerplate language, convoluted wording, and unenforceable clauses plague contracts of all varieties, and even experienced business owners can find themselves faced with a legal catastrophe if breach of contract is alleged internally or by another business entity.  Once an initial contract has been prepared, negotiations must be handled carefully.  Agreements which initially seem simple can lead to confusion, disputes, and eventually litigation, should unanticipated circumstances or complications arise.

The business attorneys of Bellatrix PC have extensive experience assisting start-ups, non-profit organizations, corporations, partnerships, and LLCs with the preparation and negotiation of contracts and written agreements.  As business owners ourselves, we focus our firm on providing clients with results-oriented, cost-efficient solutions for complex legal disputes.  To learn more about how we can assist your business, call our law offices at (800) 889-8376 to schedule a private consultation.

Contract Form

Contracts and Business Agreements Our Attorneys Handle

Contracts can take many different forms.  Our attorneys have the knowledge and skill to prepare and negotiate a wide variety of business- and employment-oriented contracts and agreements, including but not limited to the following:

  • Buy-Sell Agreements
  • Commercial Lease Agreements
  • Confidentiality Agreements
  • Consulting Agreements
  • Distribution Agreements
  • Employment Contracts
  • Joint Venture Agreements
  • Licensing Agreements
  • Non-Compete Agreements (Covenants Not to Compete)
  • Non-Disclosure Agreements (NDAs)
  • Operating Agreements
  • Partnership Agreements
  • Purchase Agreements
  • Real Estate Contracts
  • Releases
  • Separation Agreements
  • Severance Agreements
  • Software License Agreements
  • Stock Transfer Agreements
  • Waivers

Determining enforceability of contracts can be a daunting task in situations where the involved parties are located in different states or countries.  Our attorneys will assess your proposed contracts and agreements for legal vulnerabilities, advise you with regard to potential risks of the existing language, and take corrective measures as needed to protect your business’ legal and financial interests.

What Are the Elements of Breach of Contract?

It is not uncommon for clients, consumers, or other businesses to claim they have been financially harmed by a commercial defendant’s breach of contract.  While being sued is always a stressful and frustrating experience, try not to panic: in order for the plaintiff to prevail, the following elements must be proven:

  • A valid contract must exist.  This includes oral agreements.
  • The defendant deviated from the terms of the contract in a significant or material way.  Lawsuits arising from minor breaches are frequently unsuccessful due to the following point.
  • The breach must have resulted in damages to the plaintiff, such as loss of time, money, or other business relationships.  (For instance, the plaintiff lost a client because the defendant failed to deliver a shipment in accordance with the terms of the contract.)

The best way to minimize your company’s risk of facing breach of contract allegations is to prepare concise and clearly-worded agreements.  All agreements should be put into writing, so that you are prepared with a point of reference should disputes arise in the future.  Oral agreements, which do have the potential to be legally binding, leave your business vulnerable to accusations of breach and other misconduct.

Business contract

What Should Be Included in a Contract?

Of course, the answer to this question depends on the type of contract which is involved.  Likewise, business owners are strongly urged to avoid using generic, template-based contracts, as the boilerplate agreements widely available on the internet inevitably lack the level of detail and nuance necessary to cover each element of a real-world transaction.

While each contract should be unique and customized to the situation at hand, there are some general tips which can help you visualize the components of a well-written contract:

  • Use clear, plain language.  Dense legalese can be a roadblock to comprehension, which can only lead to confusion and disputes.
  • Do not include terms or clauses which could render the contract unenforceable.  For instance, covenants not to compete (non-compete agreements) are generally not enforceable in the state of California.
  • Always commit your agreements to paper, no matter how cordial the relationship.  If your agreement rests upon a promise and a handshake, you have no hard evidence to support your position should a dispute arise in the future.
  • Provide terms under which the contract may be terminated.  You must consider emergency factors like natural disasters, death, and disability, no matter how remote or unlikely these issues may seem to you now.
  • Keep all details accurate and consistent.  If a business’ name ends with LLC, make sure you include the LLC at each instance of the name.  Minor inconsistencies can present problems later down the road.
  • If the parties are located in different states, determine which state will have jurisdiction over the agreement.

If your company needs help writing or negotiating a business contract, get legal guidance from an experienced and respected law firm.  To set up a private consultation, call the contract attorneys of Bellatrix PC at (800) 889-8376 today.

Licensing Agreements

LICENSING AGREEMENTS

Intellectual property (IP) can be just as valuable, if not more valuable, than tangible assets like land and equipment.  Whether it’s a patent, trademark, trade secret, copyrighted material, or other proprietary information, IP is the driving force that gives your business an edge over your competition.  

While businesses must take careful steps to protect themselves from financial harm resulting from the unauthorized usage of IP, there can also be benefits to licensing intellectual property rights to other entities or individuals, such as creating strategic business alliances or freeing up room for greater innovation and flexibility.  In cases where a sale or transfer is unfavorable to the owner, licensing IP can be a suitable alternative, allowing the owner to retain the title.

To discuss your business’ intellectual property needs in a private consultation, call the licensing attorneys of Bellatrix PC at (800) 889-8376.  We have years of experience providing LLCs, partnerships, corporations, and non-profit organizations with cost-effective legal solutions, and have obtained favorable outcomes for numerous clients faced with a broad spectrum of intellectual property lawsuits and licensing agreement disputes.

Intellectual Property Lawyers Serving Your Business

If you’re considering licensing your company’s intellectual property, the preparation of a well-drafted licensing agreement is essential to ensuring that your IP will not be used to the detriment of your business.  The intellectual property lawyers of Bellatrix PC have the legal knowledge and business acumen to assist in the drafting and negotiation of customized licensing agreements across a wide array of industries and business, including but not limited to:

  • Arts and Entertainment
  • Beauty and Cosmetics
  • Biotechnology
  • Chemical Engineering
  • Computer Science
  • Digital Media
  • E-Commerce
  • Electronics
  • Fashion and Apparel
  • Food and Beverage
  • Mechanical Engineering
  • Medical and Pharmaceutical
  • Video Games and Computer Games

Our attorneys are prepared to assist businesses with IP matters such as:

  • Determining the ownership of rights and reviewing chain-of-title matters.
  • Litigation, mediation, or arbitration related to copyright infringement, breach of contract, or other disputes.
  • Handling patent searches.
  • Consulting on trademark and copyright law.
  • Drafting, negotiating, and enforcing the provisions of your licensing agreement.
  • Performing due diligence.
  • Consulting on marketing, advertising, and franchising.
  • Handling disputes related to unfair competition and unfair business practices.
  • Determining which parties assume product liability in the event of death or personal injury, and to what extent.

mergers and acquisitions business contract

What Elements Should Be Included in a Licensing Agreement?

Contracts of all types should be written as concisely and succinctly as possible.  However, due to the complex legal issues which are involved, licensing agreements can become dense with jargon and other obstacles to clear interpretation.  

Whether you are considering another company’s proposed licensing agreement, or are preparing to draft your own, close review by an experienced licensing attorney is essential.  The attorneys of Bellatrix PC will review your agreement clause by clause to identify and revise vulnerable points, while advising you with regard to your options and their potential outcomes.  By making your legal intentions clear today, you can reduce the risk of conflict and litigation tomorrow.  

Generic or template agreements should be avoided, which means the exact provisions of licensing agreements will inevitably vary from company to company.  However, there are some basic points which should be clarified in all licensing agreements.  No matter what sort of service your company provides, or what the relevant IP entails, your agreement should include the following components:

  • Clear identification of the parties involved in the agreement.
  • Recitals providing context for the agreement (e.g. whether the agreement resulted from a settlement).
  • A definition clause which supplies clear descriptions of each term being used in the agreement (e.g. “licensed patent”).
  • The compensation which will be provided by the licensee to the licensor, including matters like tax liability and payment schedule.
  • The obligations of each party under the terms of the agreement, including both positive and negative obligations.
  • A termination clause which provides an exit strategy by clearly addressing the circumstances under which the agreement may be terminated, and the consequences of such termination.
  • Means of conflict resolution should a dispute arise in the future, such as allegations of copyright infringement.
  • A grant clause determining whether the grant will be exclusive or non-exclusive.
  • A clause setting forth which, if any, changes or improvements may be made upon the original IP.
  • A clause addressing product liability in the event of a client or consumer’s death or injury.
  • A clause addressing whether the licensee has permission to sublicense the IP to additional parties, and if so, the extent of the restrictions upon such parties.
  • A due diligence clause addressing matters such as competing products or milestones which are expected to be met.

If your business is considering accepting or proposing a licensing agreement, don’t sign away the rights to your intellectual property until the terms of the contract have been examined by an experienced business attorney.  To arrange for a confidential legal consultation, call the law offices of Bellatrix PC at (800) 889-8376 today.

San Diego Contract Formation and Contract Dispute Lawyer

SAN DIEGO CONTRACT FORMATION AND CONTRACT DISPUTE LAWYER

Contracts are the foundation upon which all business transactions rest. In the absence of a clearly-worded, well-formed business agreement, the parties involved stand vulnerable to unfounded accusations of breach of contract, which can lead to contentious and time-consuming litigation. In other instances, unscrupulous businesses attempt to sneak in subtle clauses and stipulations with disastrous financial effects for the other signatory party.

The long-term impacts of contractual clauses aren’t always obvious, even to experienced entrepreneurs. In many cases, the smallest omission or change in wording could have lasting ramifications for the financial health of your business and its relationships with other companies or clients. Don’t sign or propose any commercial agreement until it is has been carefully reviewed by the experienced contract attorneys of Bellatrix PC. We have years of experience aiding San Diego businesses with all types of agreements and documents, from preparing the initial draft to closing the final deal, including the following:

  • Buy-Sell Agreements
  • Commercial Property Leases
  • Construction Contracts
  • Distribution Agreements
  • Employee Contracts
  • Equipment Leases
  • Government Contracts
  • Independent Contractor Agreements
  • Licensing Agreements
  • Manufacturing Contracts
  • Operating Agreements
  • Option Contracts
  • Partnership Agreements
  • Sales Staff Contracts
  • Severance Agreements
  • Third Party Beneficiary Contracts
  • Vendor and Customer Contracts

Whether your San Diego business needs help preparing an enforceable contract, or you’d simply like an attorney to review a lease or buy-sell agreement before accepting the terms, Bellatrix PC is here to provide legal guidance for all your contract formation needs. To arrange for a private legal consultation with Bellatrix PC, call our law offices at (800) 889-8376.

 

Formation of Contract: Owoman signing a contract with a smileffer and Acceptance

A contract is any legally binding agreement between two or more parties, be it written or oral. At least one party must make an offer (the offeror), which may then be accepted (acceptance) as-is by the offeree. Alternately, the offeree may propose a counter-offer with revised conditions, which may require considerable negotiation. An invitation to treat, such as an auction or display of goods, is not the same as a formal offer.

In order for a contract to be formed, all parties must be legally capable of agreeing to the proposal. This means neither minors nor incapacitated persons can enter into a business agreement.

Employers and business owners should also note that some types of contracts are typically not enforceable in the state of California – and by extension, not enforceable in San Diego. For instance, with a few narrow exceptions, covenants not to compete (non-compete agreements) are frequently ruled unenforceable by California courts.

Our attorneys will help your company identify the appropriate type of contract for your needs, and when preparing your documents, will carefully exclude any terms or clauses which could create problems with regard to enforceability.

Defending Businesses Against Breach of Contract Claims

In today’s litigious business atmosphere, it is unfortunately not uncommon for companies to allege breach of contract. In some cases, mediation or renegotiation proves sufficient to settle the dispute; but in other instances, litigation becomes necessary.

If your San Diego business is being sued, try not to panic. It is critical that you refrain from making comments out of anger, and approach the situation with a calm, cool head. Do not send any emails or make any posts on social media which could later compromise your legal position.

Contract Form

Remember: when demonstrating that a breach of contract occurred in California, the burden of proof falls upon the plaintiff. In order for the plaintiff to prevail against your company, they must be able to prove all of the following components existed:

  • A formal contract was entered into by the plaintiff and defendant.
    • It’s very important for business owners to understand that oral contracts can in fact be legally binding. We advise our clients to eschew oral contracts and use written contracts instead, simply because oral agreements cannot provide you with any sort of reference point or evidence should a future dispute arise.
  • The plaintiff satisfied its end of the contract, or was excused from satisfying its end of the contract.
    • Material (significant) breach of contract generally excuses the non-breaching party from performing its contractual duties. Immaterial breach can potentially give rise to damages, but critically, does not excuse the non-breaching party from completing its end of the deal.
  • The defendant failed to satisfy its end of the contract, either by (1) engaging in prohibited acts, or (2) failing to complete an obligation provided by the contract.
  • The plaintiff was financially harmed by the defendant’s failure (i.e. damages).

Our attorneys have successfully defended numerous companies against breach of contract claims, and are well-versed in the affirmative defenses which may be raised. If your San Diego company needs help drafting and negotiating a document, or if you aren’t sure whether you should agree to another organization’s proposal, call the attorneys of Bellatrix PC at (800) 889-8376 today to arrange for a confidential consultation.

San Diego Business Lawyer

SAN DIEGO BUSINESS LAWYER

The business attorneys of Bellatrix PC have years of practical experience representing family-owned businesses, tech start-ups, non-profit organizations, limited liability companies, business partnerships, and corporations located in San Diego and the surrounding area. Our knowledgeable legal team takes a cost-effective, results-oriented approach to each legal matter we handle, which has allowed our attorneys to achieve favorable results for numerous clients across a broad spectrum of industries.

We provide San Diego area businesses with a wide range of legal services. Whether you have questions about getting your new company registered, or need an aggressive representative who will advocate on your company’s behalf in commercial litigation, the attorneys of Bellatrix PC are equipped with the legal skill and business acumen to pursue a creative and cost-efficient resolution to the matter. Legal matters we handle include, but are not limited to, the following:

  • Breach of Contract
  • Formation and Entity Selection
  • Business Transactions
  • Lawsuits and Commercial Litigation
  • Contract Negotiation and Preparation
  • Creditors’ Rights and Debt Collection
  • Business Dissolution
  • Tax Liability
  • Trade Secrets and Intellectual Property
  • Sale of Business
  • Stock Options
  • Advertising
  • Bookkeeping and Recordkeeping
  • Equipment Leasing
  • Licensing Agreements
  • Investor and Shareholder Disputes
  • Insurance
  • Fraud
  • Board of Directors/Managers/Advisors
  • Unfair Competition and Unfair Business Practices
  • Copyright Law
  • Cyber Law
  • Due Diligence
  • Sarbanes-Oxley

If your company needs assistance with any of these areas of law, call our business lawyers at (800) 889-8376 to start discussing your goals in a private legal consultation.

businesses and business law

Business Formation and Entity Selection

If you’re planning on starting a business in San Diego, careful planning and structuring at the outset of the process is critical to the long-term success of the entity. The legal structure you select for your new organization will have lasting repercussions with regard to personal liability, the size of your workforce, the number of shareholders your company has, who will take responsibility for daily operations, how the business will be taxed, and other core components of the company.

The attorneys of Bellatrix PC have a sophisticated understanding of the financial advantages and limitations associated with each type of business structure. We will listen to your vision for your company and present you with a clear, straightforward assessment of the pros and cons of various structures.

Once an appropriate structure has been selected to suit your needs, we will assist you with the registration of your business, the review of commercial leases, your compliance with zoning and environmental laws, and other key points to go over when first opening for business.

Drafting and Negotiating Contracts and Agreements

Contracts and agreements form the backbone of all commercial transactions and employment matters. Whether you need to hire an employee, expand to a new location, or protect your trademarks and intellectual property, concise and enforceable contracts are integral to financial success. The contract attorneys of Bellatrix PC are tenacious, aggressive negotiators, and will take all measures necessary to protect your business from agreeing to any clauses or stipulations which could ultimately harm your company’s bottom line.

Many employers and entrepreneurs are surprised to learn that oral contracts can be legally binding. Oral contracts should always be avoided in favor of hard written documents, which can be referred to as evidence in the event of a future contract dispute or alleged breach of contract. Because template agreements inevitably lack the depth and nuance afforded by custom contracts, we will prepare tailored contracts that provide a detailed, comprehensive framework, clearly defining your expectations and obligations in each transaction and deal you embark on.

Commercial Debt Collection in San Diego

No business can be expected to thrive to the fullest when deprived of compensation for services which have already been rendered, or goods which have already been produced and delivered. Protracted delays in payment can bring productivity grinding to a halt, compromise your other business relationships, and create real financial risk for fledgling companies with limited resources. Our attorneys will help you explore various means of commercial debt collection, so that you can make an efficient recovery and get back on track in your daily operations.

mergers and acquisitions business contract

Depending on the nature of the debt and the circumstances under which it arose, it may be possible to obtain repayment through means such as wage garnishment, commercial liens, or bank account levies. We are prepared to take your debtor to court to obtain – and enforce – a judgment by any means necessary, even if litigation becomes necessary. We hold ourselves to high standards for fair and ethical commercial debt collection practices, but are unafraid to take aggressive measures to protect and exercise your rights as a creditor.

If you’re a business owner in San Diego and have questions about any aspect of your company at all – whether it’s about compliance with the tax code, advertising rules in California, or how to keep corporate minutes – Bellatrix PC is here to assist and advise you. To arrange for a confidential consultation, call our law offices at (800) 449-8992 today.

I’m Going Into Business With My Best Friend. Do We Really Need a Partnership Agreement?

Business and FriendshipI had a law partner for 3 months. She and I were not friends before we partnered, actually, but we became fast friends once we decided to do business together. About a month later, she joined my law firm.

It was temporary, though. Within a couple months, we disagreed on how to build and manage the business.

We parted ways shortly after that. It seemed amicable at first… until it came to the money. Then it got a little ugly (although we worked it out pretty quickly).

Now she won’t speak to me. Needless to say, we are not friends now.

Even though I did not know her long, I felt hurt and betrayed by several of her actions. I felt also some loss and grief.

I can only imagine how much worse this would have been had we been friends for a while beforehand. I do not think that a friendship beforehand would have prevented the problems — we simply clashed over business strategy and who was responsible for making certain decisions.

So here’s the lesson: if you want to keep your friend after going into business together, you better have all the boundaries and duties worked out and in an agreement.

Video Transcript:

I’m going into business with my best friend. Do we really have to sign a big, long, complicated, legal partnership agreement?
YES.

Relationships need boundaries — especially ones that involve money.

You may be longtime friends but business is not the same as friendship.

The fastest way to kill your friendship is by going into a business partnership without clear boundaries and responsibilities.

No matter how close you are, you will have different ideas and different expectations from one another and the business.

Contracts are not about trust. You must trust someone to do business with them, whether you have a contract or not. Contracts are about defining expectations so that no one is disappointed.

They are essential in outlining the rights and responsibilities of every person or company with whom you do any business. A contract will make your business and relationships smoother.

Do you know where your legal land mines are? To find out, call us for a Business Risk Review at 800-449-8992 or email us at [email protected].

If My Office Isn’t Up To Code, Can I Make My Landlord Fix It?

Landlord Fix BuildingA few years ago, I had a problem with my office. I occupied a two story unit in a mid-rise downtown.

The problem was that I was on the bottom floor. And at night, we were regularly burglarized.

With the burglaries came broken and vandalized windows, broken doors, lost property, and damage to the store front.

When I first leased the office, the landlord agreed to put up gates around the property and provide security. This was an unusual thing to contract for — and lucky. When the landlord failed to keep its promise, it had to repair the damage.

And, after a year, when the problems continued, I was able to break the lease and move out without any hard feelings or damages.

Normally commercial leases have few protections for the tenant.

You get only those you negotiate.

But what about structural problems like mold, plumbing, a leaky roof or the electricity? Are landlords required to keep up the building in good working order? Watch this video to find out.

Video Transcript:

My office building isn’t up to code. Can I make the landlord fix it?

Maybe. It depends on what the lease says.

When you rent a house or an apartment for residential use, most states have laws that protect you from slumlords forcing you to live in dangerous conditions.

But that is not the case with commercial leases.

Commercial leases lack protections most of us have come to expect from our experience with residential leases. A commercial landlord doesn’t have to provide you with a building that is up to code unless that is what you negotiated for in your lease.

A leaky roof, bad wiring or mold may be your problem and not the landlord’s. Many commercial leases require the tenant to be responsible for building maintenance, property taxes and insurance.

When you rent a space for your business, you need to be aware of the real costs of what you are signing up for.

Do you know what your legal documents say? Sign up for a Business Risk Review with Bellatrix PC to find out. For a consultation call 800-449-8992 or email us at [email protected]

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