Why An Attorney Should Draft Your Partnership Agreement, LLC Agreement Or Operating Agreement
Most people know they should have a contract with their business partners. But too often, they try to perform the legal drafting themselves, or they use a form inapplicable to their specific partnership. Usually, such contracts do more harm than good. Most small businesses form as LLCs in Washington, and rightfully so. By far the most important aspect of an LLC is the contract between the members / partners, i.e. the LLC Agreement, often called an Operating Agreement. It is crucial such contracts clearly spell out the terms of the business deal. Such terms should address important legal issues, including:
- What happens if I want to sell my business interest?
- Who can I sell to? Third parties, or just my partners?
- How will my partners and I place a dollar value our respective LLC interests?
- What happens if I want to sell all the business assets, but the other LLC members do not?
- What happens if another LLC member dies, gets divorced or goes bankrupt?
- What happens if one of my partners starts competing with the LLC?
- How do I resolve disputes with other LLC members?
These issues can only be properly addressed in a carefully and accurately drafted Operating Agreement.
If you have questions about business formation, business maintenance or reducing risk for your business, call William O. Kessler or one of the other lawyers in Beresford Booth’s Business & Real Estate Group.