This article steps through the mix of legal documents that an incubator requires - from those needed by external authorities to the nature of the agreements between incubators and their client companies.
Objectives
The objective is to enlarge on documents that govern the incubator’s relations with other institutions and with the incubated companies.
Generally, the documents are detailed as follows:
- Statutes: these instigate the entire structure of the incubator, determining its objectives, organizational structure and system of operation;
- Internal Bylaws: an incubator’s rules, which spell out its operations, with due respect for that specified at higher levels of authority;
- Contract with Incubated Businesses: defines the principals governing relations between the incubator and the incubated businesses;
- Other Legal Documents: the creation of documents that formalize the specific services rendered by the incubator, agreements with other institutions, commercial contracts, etc.
Key Issues
The following should be included in refining the incubator’s documents:
Internal Bylaws:
- General provisions (general and specific objectives, concepts, etc.).
- Activity, headquarters and operations (objective, location and functioning).
- General structure of the incubator (description of the flowchart and organizational functions).
- Capital and resources (furniture and fittings, properties, means of obtaining revenues).
- Process of selecting companies (selection phases, time periods, criteria, etc.).
- Secrecy and intellectual property (confidentiality, etc.).
- Use of incubator’s infrastructure (conditions for working together, earnings, etc.).
- Admission, permanence and exclusion (system of entry and withdrawal of the incubated companies).
Contract with the Incubated Companies:
- Identification of the project to be developed
- Obligations of the company
- Obligations of the incubator
- Validity and extensions
- Costs, deadlines and fines
- Situations for rescissions.
Responsible Parties
In general, lawyers create the incubator’s documents. Despite this, the incubator’s management team should participate in setting up the documents, to provide the specific characteristics of the incubator that is being created.
Results
Detailed understanding of the incubator’s legal documents results in formalization of its internal activities, and facilitates/conditions relations with other institutions.