Company Partnership Agreements

A contract must be written when two companies create a partnership.

A company partnership agreement is a legalized contract agreement. It is used by companies who collaborate or enter into a partnership together in the hopes of growing and expanding their client base. While each company in the agreement may have its own set of rules or regulations within the business, a new agreement must be written to suit the needs of both businesses and to legalize the new partnership.

Company Profiles

A company partnership agreement should include a short profile of each company that has entered into the agreement. The profiles should discuss the companies as separate entities and show how the companies can work together. A reason for the collaboration or partnership should also be addressed. This is to ensure that both companies know the reason why the partnership is being drafted in case disagreements should occur in the future.

Ownership

While some companies may come together in an equal partnership with equal ownership, other partnership agreements may leave one company with more ownership rights than another. The ownership percentages should be outlined in the agreement, as the ownership distribution is often linked with time worked and the overall payments or profits given to each respective business. If it is a temporary business partnership, the payments and hours worked could already be agreed upon, but should be outlined in the agreement anyway.

Roles and Responsibilities

The companies involved in a professional partnership agreement may have certain contributions or roles they must fulfill. These roles and responsibilities must be outlined in the contract so each business owner knows what is expected. For instance, this could be a partnership between a product manufacturer and a marketing company. While the manufacturer produces the products, the marketing company is responsible for marketing and promoting the products. The question of employees should also be outlined under responsibilities, as employees from each business must play a role. A permanent partnership agreement between companies may lead to a termination or a hiring period.

Worth and Capital

A single company may bring in some assets as net worth value to the partnership. These assets should be addressed so the right business or assets owner get the proper value back should the partnership dissolve. This is done to protect all companies in the agreement.

Ending a Professional Partnership

A professional partnership is a temporary agreement, it will have an end date in place in the contract. It may, however, have been drafted with the intention of being a long-term agreement. If no end date is listed on the contract, the companies must have a method present to leave the partnership should it not be beneficial to the business or brand. The procedures necessary to leave the agreement, sell the partnership rights or dissolve the partnership should all be detailed in the agreement.

References

• Small Business Notes: Sample Partnership Agreement
• Public Legal Forms.com: Partnership Agreement