After 2 weeks I'd have my lawyer send a stern warning that they could be held in breach of contract.

I will, of course, be running it past my lawyers as well.

-If this situation is confusing to you, you need to talk to a lawyer before you set this up, the tracing of the legal entities and responsibilities are crucial to making sure you get the liability protection that an LLC provides.

There are many avenues to take with taxes, but I am by far not qualified for that kind of advice so talk to an accountant and/or lawyer to figure out what may work for your situation.

I highly recommend reading "Lawyers Are Liars" by Mark Kohler.That being said, a simple LLC and an umbrella policy is what I see most people using.

We've gone out and hired lawyers state by state at great expense, to make sure that the forms meet state-specific concerns and address concerns that we've seen come up across thousands of interactions with landlords over the years. 

I have heard and read a number of times around here that I can find funding to come to the table with the rest of the funds to close the deal.I'm fine paying closing costs and lawyer fees and I consider that to be skin in the game.

Hire a lawyer to draw up a contract that suites you both.

The briefest answer is that your friend should get with a lawyer experienced in commercial real estate contracts.

But do get a lawyer because if all the tenants band together and get a lawyer you're better off with a lawyer.