Running a business in Colorado means working with contracts almost every day. Whether it’s hiring a contractor, signing a lease, or dealing with suppliers, contracts protect your rights and help prevent disputes. A proper business contract review makes sure each agreement is clear, fair, and legally sound.
Many business owners sign documents without fully understanding the terms. That can lead to confusion, missed deadlines, or even lawsuits. Knowing what to look for in a business agreement is the first step to protecting your interests.
Service Agreements and Sales Agreements
Service agreements outline the details when someone is hired to perform a task or provide ongoing services. Sales agreements are used for selling or buying products.
What to look for
- What services or goods are being provided
- When they’ll be delivered or completed
- How and when payment will be made
- What happens if one party doesn’t meet the terms
Clarity is everything. Vague or one-sided language can lead to costly misunderstandings.
Vendor and Supplier Contracts
Vendor and supplier contracts set expectations when your business depends on another company for goods or services. These agreements should include pricing, delivery terms, performance standards, and what happens if there are delays or product issues.
Key points
- Delivery timelines
- Quality control measures
- Payment terms
- Termination rights
Small businesses are often handed templates that favor the vendor. A review helps balance the terms.
Non-Disclosure Agreements (NDAs)
NDAs protect private information. These are common when discussing ideas, strategies, or finances with potential partners or employees.
Watch for
- What information is considered confidential
- How long the confidentiality lasts
- What happens if there’s a breach
NDAs should be mutual and not overly broad. Some NDAs are written to only protect one side.
Independent Contractor Agreements
Hiring freelancers or independent workers requires clear terms. These agreements explain the scope of work, payment, timelines, and intellectual property rights.
Clauses to check
- Project details
- Payment schedule
- Ownership of work product
- Non-compete or non-solicitation rules
Misclassifying a worker can create legal issues with taxes and labor laws. A contract review helps avoid those risks.
Franchise Agreements (Review Only)
Buying into a franchise means agreeing to terms set by the franchisor. These contracts are long and often complex.
Important areas
- Fees and royalties
- Territory rights
- Training and support
- Rules for renewal or exit
Franchise agreements are rarely negotiable, but a review helps you understand your obligations before signing.
Commercial and Residential Real Estate Contracts
Leases and purchase agreements for real estate require close attention, especially when they involve business use.
Types of contracts
- Commercial leases
- Commercial subleases
- Residential leases
- Residential purchase and sale agreements
Review items
- Lease duration and renewal terms
- Responsibility for maintenance and repairs
- Termination conditions
- Hidden fees or rent escalations
Real estate contracts can bind your business for years. A review helps prevent future headaches.
Software Agreements and SaaS Contracts
Technology companies often use Master Services Agreements (MSAs) along with Statements of Work (SOWs). These define the overall relationship and the specific tasks to be completed.
MSAs usually include
- Service levels
- Data security terms
- Liability limitations
SOWs outline
- Specific tasks or deliverables
- Timeline and milestones
- Payment terms for each projectFor Software as a Service providers, these documents are key to managing customer relationships and avoiding disputes.
Supply and Distribution Agreements
If your business manufactures, sells, or distributes products, these contracts define how goods move through the supply chain.
Look for
- Volume and pricing commitments
- Delivery schedules
- Payment terms
- Risk of loss or damage
These agreements often involve tight deadlines and logistics issues. A review can help limit financial risk.
Guaranty Agreements
A guarantee agreement is used when someone agrees to be responsible for another party’s debt or obligations. These are common in loans, leases, and vendor credit accounts.
Risks to consider
- Scope of the guarantee
- Duration of the obligation
- Conditions for release
Signing a guarantee without a review can expose your personal assets or the company to hidden liability.
Why a Business Contract Review Matters
Even simple agreements can include terms that are confusing, one-sided, or unenforceable. Missing a small detail can lead to lawsuits, damaged relationships, or financial loss. Online templates often don’t follow Colorado law or account for your business’s specific needs.
You don’t have to guess what a contract means. A business contract review can help spot red flags, explain your risks, and suggest changes before you sign. It’s much easier to fix a problem before it becomes a lawsuit.
If you’re unsure about an agreement or just want peace of mind, speak with a Colorado business lawyer at Baker Law Group, PLLC. The cost of a review is far less than the cost of a mistake.
