Since you have decided to join hands with a few friends and associates who you believe would be ideal to do business with, it is always better to ensure that the entity you set up is one that will protect you. More than anything else, it is also necessary for you to know how safe your investments are in a firm such as this. This is why a limited partnership works for most. Once you are clear about the entity, do take some time to put together a proper limited partnership agreement and get it vetted by a professional who knows legal clauses and requirements, like the back of his hand. Today, there are enough and more people who can help you with this agreement by drafting it and including all the points that you would like enshrined in an agreement of this sort.
Profit-Sharing
Though this is not the only point that is found in the agreement, it is true that it is one of the main and vital parts of the partnership deed.You also need to remember that this deed would be considered an invalid document if it is not registered at the appropriate time with the right authority. In most states, the authority that is tasked with this kind of registration is usually found in every big city. These are registrars who go through the agreement with a fine-tooth comb and ensure that it is a well-worded and fair document. Once they are happy with what they have gone through, they set a date for registration and the partners who have agreed to do business together are asked to come in and the same is then registered.
Conflict Resolution
Any partnership deed that is put together also has a clause that focuses on what needs to be done in the event of a dispute. Generally, there is enough time that is given to each of the partners to sort out their differences through dialogue and a peaceful process. In case this kind of dialogue does not work the clause specifies that the matter can be presented before a court and the court’s decision will be final. What usually happens is that the partnership deed specifies which court can be approached in the case of a conflict.
Though a deed is an important document, it is necessary to have a sense of fairness and balance while operating in any kind of business.