3. Legal persons may be individuals, limited liability companies, corporations, and other entities. A fictitious name should not be used in the intro paragraph or signature block instead of the company's legal name. SIGNATURE-For a sole proprietorship business, there is only one signatory for the check, which is the sole proprietorship.However, for partnerships, corporations or cooperative there is one more owner of the business, it is a good internal control to practice to require at least two signatories on all checks written. A few of those risks are outlined below. Generally speaking, an organized entity does not change its location from one state to another. It is recommended by the. A sole proprietorship is the simplest form of business organization because it really is not an organization at all. For example, it is a common business practice for the president of a corporation to have the authority to sign contracts for supplies needed in the ordinary course of business. Although entities are considered legal persons, for the most part, a human agent must act for them. Sign the way you do for all other documents such as a check. The information in the introductory paragraph and the signature blocks should match exactly. For example, a Delaware limited liability company is located in Delaware and filings must therefore be made in Delaware. much less likely to realize that incorporating without a lessor’s prior written consent is a violation of the lease. This act isn't reserved for only legally binding contracts. The obligated party is Mr. Doe, and his bank account, personal or business, and other assets would generally be available to satisfy any indebtedness to the lessor. No documentation is required to create a sole proprietorship; a sole proprietorship is a person merely doing business under his or her business name. This should be fairly obvious as the individual is merely signing the papers using his or her business name. Name of Debtor A financing statement is not effective to offer the secured party protection if it does not properly identify the debtor by name. That is, any document they sign is considered to be signed by the corporation itself. If the contract needs to be valid in another country, request an authentication certificate from your state agency. No need to spend hours finding a lawyer, post a job and get custom quotes from experienced lawyers instantly. For example, if someone is doing business as a sole proprietor, that person is the party to the contracts for the business. These risks include the location, name and movement of the debtor as well as the transfer of collateral. A proper signature block for execution by a sole proprietorship is: John Doe d/b/a/ Doe’s Lasers. This difficulty has resulted in a flurry of states passing or threatening to pass non-uniform “safe harbor” provisions specifying that certain sources of an individual’s name will be accepted as providing the true name for UCC filing purposes. The name to be used for corporations, limited liability companies and other formal business entities created by filings with state agencies such as the Secretary of State is generally clear and can be verified online with the applicable state agency or otherwise in an independent manner. Consequently, his signature may still bind the corporation to the contract. Alternatively, it could merge the Alabama corporation into the Florida entity (a transaction viewed by Article 9 as a transfer). much more likely to incorporate as their business increases than they are to sell assets to another company and 2.) There is usually a separate section on the signing page for the notary to use a stamp or seal as formal authentication and acknowledgment of the contract. When a corporate officer signs a legal document, it is important for the signature block to clearly show that the corporation, not the corporate officer, is the party to be bound by the document. As mentioned earlier, a merger-type event is viewed as a transfer of collateral. Was this document helpful? Specializing in business law, she authored hundreds of legal briefs and memoranda during her years as a research attorney. If an individual debtor decides to “incorporate,” this will also result in the individual being viewed as “transferring” certain of its assets to the newly incorporated entity. If a company is doing business as the XYZ Store, Inc., but its legal name is John Doe Enterprises, Inc., contracts would be signed as John Doe Enterprises, Inc., d/b/a the XYZ Store, Inc. (8) This Proprietorship acknowledges and agrees that NSBC may rely on alternative signature and verification codes issued to or obtained from an authorized agent on this resolution. 1. A sole proprietorship is simply an individual person doing business in his or her own name or in a trade name. Location of Debtor The first risk stems from the fact that the UCC provisions under Revised Article 9, which govern where a secured party must file (or where a lessor under a true lease files its precautionary filing designed to protect it in the event the lease is determine by a court to be a lease intended as security or a loan). Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb. The list is long. Prudent secured parties should comply with the four-month rule for now. On the other hand, individuals can “move” by changing their principal residence. For example, a contract may be signed: "Acme Corporation, by John Smith, President." Hire the top business lawyers and save up to 60% on legal fees. The contract must be signed by both parties in the presence of the witness or. These filing rules are based upon the “location of the debtor.” If the debtor is an organized entity, it is located in the state in which it is created. While this sounds like good news for filers, it is bad news for searchers. Sometimes, a corporation may be bound to a contract as a result of the actions or statements of officers who appear to be acting on the corporation's behalf. As a result, the president may be considered to have the implied authority to do so, even if he is not explicitly authorized in the corporation's bylaws or resolutions. The board of directors can name the officers with authority to sign those documents in its bylaws or corporate resolutions.
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