Signing Documents for Your Business
One of the reasons most business owners form a legal entity is to avoid personal liability for the liabilities of the business. Unfortunately, many business owners expose themselves to personal liability by not properly identifying the business when they sign agreements. It defeats the purpose of forming the business entity if Joe Smith forms his business as XYZ, LLC. but then signs a contract with a supplier as simply “Joe Smith”. In order to maintain the benefit of the separate entity and avoid personal liability, the business owner should sign contracts, proposals, agreements and any other documents for a business as follows:
When entering into an agreement on behalf of a corporation:
[NAME OF CORPORATION – e.g. XYZ, Inc.]
[Your Name], President
When entering into an agreement on behalf of a limited liability company:
[NAME OF LLC- e.g. ABC, LLC]
[Your Name], Manager
Business owners should also include the name of their corporation or limited liability company on their letterhead and email signature block. The goal is to make sure that those with whom you communicate know that they are dealing with a business entity and not an individual.
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