Browse our Partnership & LLP Agreements Services
Bury & Walkers' company commercial lawyers can assist you with your Partnership Agreement or LLP Agreement so that you can try to avoid future issues for your business and help develop your business.
The main difference between these two agreements is that the limited liability partnership is subject to its own legislation and has the benefit of limited liability. It gives you some of the benefits of a company but with not as many formalities.
Both agreements are likely to cover issues such as the following:
- When does the partnership begin and is it for an indefinite period or a limited period in time.
- What will be the name of the partnership, the business to be carried on and the place of business.
- Capital – Usually, partners will be expected to contribute some form of capital to the business and the initial and future levels of capital contribution will be identified for the avoidance of any doubt. The interest payable on capital balances may also be agreed.
- Partnership Property – It is likely that the partnership will have assets and the agreement will set out the proportions in which the partners own those assets if, for example, the partnerships was wound up.
- Profits and Losses – You can identify how profits and losses will be shared between the partners. They might not be shared equally.
- Drawings – A potentially disruptive area can be regulated by inserting proper provisions in the agreement about the level of drawings that are permitted by the partners. If not, it may be that one or more of the partners expect to withdraw more cash from the partnership than they are entitled to which causes ill feelings between the partners.
- Duties, Powers and Restrictions – Are the partners going to be obliged to dedicate all of their working time to the business? What powers do each of the individual partners have to, for example, enter into contracts or borrow money on behalf of the partnership? Are there certain decisions that need the approval of all of the partners?
- Holiday Entitlements
- Retirement and What Happens on Death – What happens when a partner wants to leave the partnership. Is that person entitled to immediate repayment of all of their capital or must they take it out in instalments to safeguard the business.
- Restrictions – Should the outgoing partners be subject to restrictive covenants that prevent them from taking away the partnership’s existing clients or operating in the vicinity of the business?
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