A business partnership can be an exciting opportunity, but without a clear agreement, it can also become a source of conflict. A business partnership agreement is a legally binding document that outlines how the business will be run, how profits and responsibilities will be shared, and how disputes will be resolved. Attorneys at SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) law firm provides professional legal advice and services to clients in Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, and surrounding communities.
Why a Partnership Agreement Is Important
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Prevents misunderstandings about financial contributions and roles.
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Provides a framework for resolving disputes.
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Establishes clear exit strategies.
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Protects both partners legally and financially.
Key Elements to Include
1. Ownership Structure
Define how much of the business each partner owns and what percentage of profits or losses they will receive.
2. Roles and Responsibilities
Clearly outline each partner’s duties—such as operations, finance, marketing, or management.
3. Capital Contributions
Specify how much money, property, or other assets each partner is contributing.
4. Profit and Loss Distribution
Detail how earnings and losses will be divided.
5. Decision-Making Authority
Outline voting rights, management powers, and what decisions require unanimous approval.
6. Dispute Resolution
Include methods like mediation or arbitration to handle conflicts without costly litigation.
7. Exit Strategy
Address what happens if a partner wants to leave, sell their share, or if the business dissolves.
8. Non-Compete and Confidentiality Clauses
Protect the business from competition or unauthorized sharing of trade secrets.
FAQs About Partnership Agreements
Do I need an agreement if I trust my partner?
Yes—good agreements protect friendships and businesses alike.
Can I create a partnership agreement without an attorney?
While templates exist, legal review ensures the agreement is enforceable.
Contact Us
If you’re starting a partnership, our business attorneys can draft a customized agreement to protect your interests. Contact us today for a consultation.
Have any legal questions? Contact the Attorneys at SBEMP Law Firm:
For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.
SBEMP LLP is a full service law firm with attorney offices in Palm Springs (Palm Desert, Inland Empire, Rancho Mirage, Indian Wells), CA; Indian Wells, CA; Costa Mesa (Orange County), CA; San Diego, CA; New Jersey, NJ; and New York, NY.
DISCLAIMER: This blog post does not constitute legal advice, and no attorney-client relationship is formed by reading it. This blog post may be considered ATTORNEY ADVERTISING in some states. Prior results do not guarantee a similar outcome. Additional facts or future developments may affect subjects contained within this blog post. Before acting or relying upon any information within this newsletter, seek the advice of an attorney.
