Legal: When to Review, Update Business Contracts

As an attorney, I write a whole lot of contracts — terms of use, privacy policies, employment agreements, leases, and non-disclosure agreements, amongst others. But what most people don’t understand about structures, even if written by an attorney, is they should stay alive, breathing files. The record which gets written for your company today may not be the record you will want tomorrow. So when should you have contracts analyzed?

Below is a general guideline. Despite the fact that the list isn’t exhaustive, it should help you arrange your legal needs throughout the year. Your situation may vary so it is always best to ask your attorney what she recommends as a time for review of contracts.

Non-Disclosure and Confidentiality Agreements

Non-disclosure agreements (NDAs) and confidentiality agreements are normally the arrangements which have examined the least. Lawyers frequently write them to be rather generic and open-ended. Whether you are selling widgets, gidgets, or gadgets, your NDA probably says that you and another party are ditching something like”business ideas, concepts, and information” and anything revealed which is not public information should be keeps confidential until it pops up in the public domain through no fault of the party receiving the confidential information. As a consequence of this, I usually tell clients that they have to have these arrangements examined once a year or so at most unless another party wants to make changes or my client want to make alterations, in which case the arrangement needs to be reviewed prior to being signed with any alterations.

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Employment Agreements

Employment agreements will have to be reviewed on a regular basis and if anything changes with the type or location of employee you’re hiring. Inspection should happen at least a yearly basis to incorporate any changes to employment law in your state. Furthermore, a review should also happen immediately if any of these happen.

  • You hire someone in a different state. This is due to state laws vary on everything from minimum wage to profits demanded.
  • You hire someone in a position you didn’t have before.
  • You invite someone to a position you didn’t previously have.
  • That you will need to provide more benefits to someone.
  • You want to give fewer benefits to somebody.
  • That you will need to demote someone — whether for performance or requirement.

Website Agreements

Website arrangements — terms of use, privacy policies, copyright policies — should be assessed at least every 2 decades. Moreover, the arrangements must be assessed immediately if any of these happen.

  • You alter your privacy procedures. For example, you start storing data that you didn’t previously; you start selling to advertisers where you didn’t before; or you start receiving geo-location info from clients.
  • you plan to merge your company with another company or advertise your organization.
  • You change your business model. For instance, you begin selling things that you didn’t before, you change your return policy, or you add features to your site.
  • There are any changes in regulations regarding privacy policies or copyright problems.

Software Licenses

Software permits must be reviewed at least every 2 decades or using a version change, whichever happens first. Additionally, you also must possess the licenses reviewed if any of the following happens.

  • You change the way the program is supplied. By means of example, you start to charge monthly rather than having a perpetual license.
  • Your change how your applications works.
  • You create versions that may work with new operating systems. By means of example, you create a version for a Mac when you are only Windows based before.
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House Leases

Property rentals should be assessed before they are entered into and before being renewed. Furthermore, you should have them assessed if you have any issues with your landlord, and approximately one and a half years until they are terminated to learn what your renewal options are. Most leases state you will have to give a renewal note anywhere from 365 to 180 days before the lease is up or you lose your right to renew under the conditions in the rental.

Equipment Leases

Equipment rentals are like property rentals and have to be assessed before they are entered into and before being renewed. Furthermore, you should have them assessed approximately one and a half years until they are terminated to learn what your renewal options are. Unlike home leases, equipment leases typically renew automatically ; you may end up getting a copier, printer, or other piece of equipment for a lease payment that is a whole lot greater than the equipment is worth.

Business Documents

Your company documents should be reviewed every few years if you do not have partners and every additional year or so in case that you do have spouses. Furthermore, you will need to have your company documents reviewed in one of these instances.

  • You expect attracting new partners — if they are working in the company, buying into the company, or investors.
  • You are creating an estate plan or a number of your partners are.
  • Your company is in financial trouble.
  • You or one of your partners in in financial trouble.
  • That you need to shut the company down.
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Furthermore, note what files you’ll have to create yearly or more often. You may need to get board-meeting minutes, shareholder minutes, or member-meeting minutes.

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