26 May 2016
TO DISCLOSE OR NOT TO DISCLOSE?
The Question of Non-Disclosure Agreements
If you are contemplating entering into a business relationship with someone, the first agreement you may encounter is a non-disclosure agreement (NDA). NDAs are used, among other times, when starting new businesses; acquiring new technology or other operational needs; and in the discussions to purchase or sell an existing businesses. Often times, one party to such a discussion will suggest that an NDA be executed and present the other party with a form agreement.
When you formed your business, you may have contemplated what type of business entity to choose. You likely considered sole proprietorship, partnership, corporation or limited liability company (LLC). Each entity has certain advantages and some disadvantages. Generally, to protect yourself from personal liability, the two best alternatives are either a corporation or a limited liability company.
If you have a Nevada Limited Liability Company (“Nevada LLC”) and you have worked with me in the past, you know I believe it is vital for you to have an Operating Agreement. An Operating Agreement, although not legally required for a Nevada LLC, can set forth the rights and responsibilities of the Members of the Nevada LLC. It can spell out how you add additional Members; how you sell Membership Interests; and in the case of a business divorce, it serves as a prenuptial agreement.