Legal & Insurance Templates
Lives in: 07 — Firm Operations
The legal documents we need + where to get the templates + how to deploy them. None of this is legal advice — we'll have a Utah lawyer review the key docs.
Customer-facing legal
Master Services Agreement (MSA)
The umbrella contract a customer signs once, then each engagement adds an SOW under it.
- Template source: LegalContractsOnline.com (Utah-friendly templates)
- Lawyer review: 1 hr with a Utah business attorney to scrub for our specifics (IP ownership, warranty terms, liability cap, dispute resolution)
- Total cost: ~$300–500
- What to customize:
- Liability cap (typically capped at the engagement value, e.g. $47K)
- IP ownership — Customer owns the code we build for them, we keep ownership of any reusable libraries / patterns
- Warranty period (30 days production fixes, our standard)
- Termination clauses
- Confidentiality + carrier-NDA flow-through (matters for B. Jackson and any utility contractor)
Statement of Work (SOW)
Per-engagement scope doc that lives under the MSA.
- Template source: same as MSA
- Maps 1:1 to our Acceptance Criteria standard
- Always includes: scope, deliverables, acceptance criteria, payment schedule, warranty terms
NDA (Mutual)
Some prospects ask before discovery. We say yes by default.
- Template: mutual NDA, standard 2-year term, narrow definition of confidential info
- Source: same shop
Internal / cofounder legal
LLC Operating Agreement (multi-member, 50/50)
The doc that governs how Addison and Sam co-own Confluxion Point.
- Template source: LegalContractsOnline.com — multi-member 50/50 template
- Critical clauses to confirm:
- 50/50 ownership split
- Tax treatment (LLC taxed as partnership by default; consider S-corp election later for self-employment tax savings)
- Capital contribution treatment → reference our Capital Contribution Log
- Buy-sell provisions: what happens if one cofounder dies, divorces, or wants out
- Voting rights on big decisions (taking on debt, signing engagements over $X, hiring employees)
- Distribution rules: when profits get distributed vs. retained
Founder IP Assignment + Vesting Agreement
Protects against either cofounder walking with code or IP that should belong to the firm.
- Template source: Promise Legal (free template)
- What it covers:
- All IP created on behalf of Confluxion (or while a member) auto-assigns to the firm
- Vesting schedule on equity if either cofounder leaves early (e.g. 4-year vest with 1-year cliff — if Sam leaves in month 8, Confluxion can buy back his shares at cost)
- "Inventions assignment" — code, processes, brand assets
Insurance
Errors & Omissions (E&O / Professional Liability)
If we miss a deadline, deliver something that breaks, or get sued for bad advice — E&O covers it.
- Providers: Hiscox or NEXT (both quote online in ~15 minutes)
- Coverage minimum: $1M per occurrence / $1M aggregate
- Estimated cost: $60–120/mo for our size + scope
General Liability (GL)
Covers third-party bodily injury / property damage. Less likely to fire for a software firm, but customers often require it in MSA.
- Same providers; usually bundled with E&O
- Coverage minimum: $1M / $2M aggregate
- Estimated cost: $30–50/mo (or +$25 if bundled with E&O)
Cyber Liability (optional)
Covers data breach response, ransomware, etc. Recommended once we're routinely handling client credentials.
- Estimated cost: $30–60/mo extra
- Add when we hit our 3rd customer or first customer requires it
Workers' Comp
Not needed yet — only required for W-2 employees. 1099 contractors don't trigger it. Revisit when we hire.
Deploy order
- LLC formation (UT Division of Corporations, $54)
- EIN (IRS, free, instant)
- Bank + credit card open
- Operating Agreement + Founder IP — sign both before doing anything else important
- E&O + GL insurance — quote and bind
- MSA + SOW templates — get reviewed; use them for the next signed customer
- NDA template — keep on file for prospects who ask
Last updated: 2026-05-25