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Business partnerships are modes of scaling the business in volume transactions and ensuring further capital investment for the enterprise. Bringing in a new partner gives a business varied decision-making perspectives, liability distribution and investment angles that are not workable with a sole proprietor setting. In Florida, partnerships in business have to be considered with the workable and operational mediums of the business to ensure clarity in roles and duties.
What to consider with a new business partner:
Incorporation papers (Articles of Incorporation)
Business partners bring a wealth of options regarding the input they bring to the business. Getting a business law attorney to structure incorporation papers is fundamental. The incorporation papers will dictate and detail the roles the partner will have and the obligations they will be expected to meet in the partnership. Incorporation papers are vital to any partnership as they serve to systematically guide all other undertakings of the business.
All business experts must take into account the signing of agreements which protect the business in case of disagreements and turbulent management periods. Agreement signing should be done immediately before a partnership is expanded or created, before the value of the business increases or decreases, and before debt is incurred to ensure fair distribution of the same. There are several agreements that must be executed including:
This will protect the business against leakage of company secrets and strategies in case a partner opts out of the partnership and aligns with competitors or starts their rival enterprise.
Power of attorney agreement
Hiring an experienced business attorney like Brock Law to structure this agreement will give other partners the power to make decisions in the absence or incapacitation of one another.
Arbitration Dispute Resolution agreement
This will dictate when there is a disagreement between partners on management and decision making.
There is always the risk of a business not achieving the initial potential or a partnership not working out, and this is why getting a business law attorney to structure a buyout clause is important. With a buyout clause, a partner can buy their way out of the partnership at their appointed time.
Find out more about business law in Wesley Chapel and its important considerations before partnering in any business opportunity by visiting our website or calling our office at 813-333-7267.