When you start a business with one or more other people, or if you bring on investors, the most important contract your business will have is the agreement among the owners: The Shareholder Agreement for a Corporation or the Operating Agreement for an LLC. These Partnership Agreements establish the terms of the relationship among the owners. Yours should include everything you can think of regarding how decisions for the company are made, who contributes what and when, how the owners get paid, how to bring in additional owners, and a myriad other choices.
- What will you do in case one partner wants to retire or sell out? One of the most important elements of the Partnership Agreement is the Buy-Sell terms.
- What happens if a partner dies?
- Are profits going to be paid out differently to different partners?
- Are minority partner going to be protected from being frozen out?
The Argent Place Solution
- Hold an initial conference among the owners to get a sense of their general intentions
- Draft the Partnership Agreement
- Incorporate Buy-Sell Agreement into the Partnership Agreement
- Protect interests of minority owners
- Conform to the SBA and federal regulations for Minority Owned Businesses
- Protect SDVOSB status
- Serve as General Legal Business Counsel
- Negotiate with new investors
- Provide confidence that all owners will be heard and will understand what they are getting themselves into.
- Act as a source of accountability to protect the interests of all owners
- Represent the original owners when bringing in investors
The 7 Dos and Don’ts Of Writing Your Own Contracts