Legal Contracts Commonly Used by Business Start-ups
When you are starting out with a new business it seems like everything has to get going as soon as possible. However, it is important to ensure all aspects of the legal front are covered to ensure that your business will continue to run smoothly.
Legal contracts you need:
Articles of incorporation/Constitution:
By filing with ACRA the type of company you choose (e.g. sole proprietorship, Limited Liability Corporation, etc.) will be given official status as an incorporated company in Singapore.
The shareholders’ agreement should be a comprehensive document, detailing the entire relationship between stakeholders of the company and the business entity.
It should include shareholders rights, limitations (e.g. when selling and acquiring shares), policies for shareholder meetings, clauses for returns and dividends, as well as other provisions deemed necessary. The agreement must also cover partners’ duties and level of authority.
Agreements with employees must be meticulously documented. All compensation and benefits provisions, intellectual property, and non-compete clauses must be written and signed by your company and the employee. You may find an example of an employment contract here
This contract dictates the share structure open to potential investors. It may cover votes for shareholder meetings and decision-making as well as other items needed. It is important to clearly outline conditions for owning, selling and transferring shares.
Before starting partnerships with external parties and other companies, you should have a signed NDA to cover any material which may be deemed confidential. The agreement will protect your products and services, especially technological innovations.
These are the internal guiding principles of your company. The regulations for employees, rules and responsibilities of management and shareholders must be outlined in detail. The potential liabilities of the company will also be lessened once these are taken care of.