THE

FERNANDES
LAW FIRM

Client Memo
Date: Wednesday, January 12, 2011
To: Client of Fernandes Law Firm
From: J.P. Fernandes, Esq.
Re: Document Creation and Organization

I am providing you with this Memo in order to assist you in the proper operation of you
company. While most of this material may seem obvious, many times it is the details like
these that can slip through the cracks and cause real headaches down the road.

As we complete the formalities associated with launching your new business, you need to
develop a system for storing and organizing all the documents relating to the business.
Disorganization of company contracts and related materials is often taken as a sign that the
business itself lacks direction.

Founders often neglect file organization. However, it can pay real dividends when you
attempt to raise money from outside investors since they will be asking for detailed
information about the business that can only be located if the company already has a filing
system in place. In fact, this list is based in part on my experience in handling due diligence
investigations by investors and other prospective business partners. The ability of an
entrepreneur to provide all the required information quickly and completely is, in fact, one of
the things that can impress the investor group.

1. General Records

Prepare a general records and information binder that includes all of the following documents
and records:

Minutes of meetings of the board of managers (and all permanent committees thereof)
and owners of the company since inception.

Organizational documents of the company (e.g., articles of incorporation and bylaws,

partnership agreement, or operating agreement).
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List of names, ages and addresses of officers and board members of the company and
description of the management structure, including all organizational charts.

Current owner and optionee lists, including issuance dates and issuance or option price.

All agreements, warrants, options, pledges or other rights to purchase or acquire any
ownership interests or other securities of the company from either the company or its
owners, and any commitments with respect to any of the foregoing.

All agreements among owners of the company with respect to the voting, sale or other
disposition of ownership interests of the company.

Agreements relating to preemptive or other preferential rights to acquire securities,

including rights of first refusal.

Agreements relating to registration rights.

2. Regulatory Matters

(a) List and description of any government regulations (federal, state, local or foreign) of
whatever kind (safety, food and drug, labor, environmental, etc.) that have special application
to the business of the company. Copies of all correspondence relating to compliance with
each listed regulation should be maintained in separate files.

(b) A description of all current or threatened investigations by any government authority.

Copies of all correspondence relating to each listed investigation should be maintained in
separate files.

3. Personnel

(a) All employment and consulting contracts with any employees of or consultants to the
company or its subsidiaries.

(b) A list of all loans or guarantees by the company and/or any subsidiary to affiliates of the
company (e.g., officers, directors, employees and/or owners).

(c) All employee benefit plans, including, but without limitation, option plans.

(d) All contracts or agreements with or pertaining to the company and to which affiliated
parties of the company are parties, and all documents relating to any other transactions
between the company and any affiliates of the company.
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4. Agreements

(a) List of principal types of contracts entered into in the operation of the company’s business
and copies of forms of each of such contracts.

(b) All marketing and distributorship agreements or arrangements of the company.

(c) All present or pending joint venture or partnership agreements and other such
arrangements in which the company is a party or is otherwise involved.

(d) Non-disclosure and inventions agreements

(1) All forms of nondisclosure and invention assignment agreements binding the
company, its current or former owners, directors, officers, employees or affiliates.

(2) A list of any employees or consultants who have not signed proprietary
information and invention agreements, including a list of any periods of time where
key employees or consultants performed services for the company while not bound by
such agreements.

(e) All agreements containing the right to purchase the securities of another company.

(f) Any agreement that restricts the ability of the company to compete in any line of business
or geographic territory, or commits the company to continue in a line of business.

5. Litigation

(a) Description of all claims and pending or threatened litigation, arbitration, administrative
and regulatory proceedings (including criminal proceedings and grand jury investigations)
against, by or affecting the company, its current or former directors, officers or employees.
Copies of all correspondence relating to each listed matter should be maintained in separate
files.

(b) A description of all litigation concluded or settled during the last three years.

6. Patents, Trademarks, and Intangible Assets

(a) Identification of all material intellectual property, including copyrights, patents,

know-how, trademarks (registered and unregistered), services marks (registered and
unregistered) and trade names.

(b) All agreements to which the company is a party with respect to any of the intellectual
property, including without limitation license agreements, distribution agreements,
assignments or consent agreements.

(c) All correspondence, pleadings and other documents regarding any allegations by or against
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the company regarding patent infringement, copyright infringement, trademark infringement,

counterfeiting, dilution or unfair competition.

7. Financing

(a) All agreements of the company relating to the borrowing of money, including indentures,
notes, term loan and revolving credit agreements, and debt instruments issued thereunder.

(b) All guarantees by management or others of debt or performance of or by the company.

(c) A list of all currently effective security agreements covering assets of the company, such
as mortgages, pledges, liens, or security interests in personal property, such as receivables,
inventory, or equipment.

8. Miscellaneous

(a) The most recent business plan of the company.

(b) All reports, studies or analyses (including any projections) relating to the company’s
financial condition, business operations, marketing programs, industry generally, etc., which
may have been made by:

company management

Consulting or similar firms;

The company’s independent accountants; or

Investment bankers.

(c) Most recent financial statements.

(d) All correspondence from accountants during the last five years that relates to the
company’s accounting practices or policies, including management letters.

(e) Other standard forms of agreements used by the company.

(f) Agreements requiring consents or approvals in connection with this transaction.

Please contact the Fernandes Law Firm with any questions you may have so your company
can continue to operate smoothly and profitably.