When entering into a partnership with another individual or company, it is crucial to have a clear and comprehensive partnership agreement in place. This document outlines the roles and responsibilities of each partner, the division of profits and losses, and any other important details related to the partnership.
However, it is also important to be aware of what should not be included in a partnership agreement. Here are a few things that should be left out of this document:
1. Personal relationships: A partnership agreement should focus on business matters only. It is not necessary to include personal details about the partners` relationship or history.
2. Day-to-day operations: While the partnership agreement should outline each partner`s role and responsibilities, it should not dictate the day-to-day operations of the business. It is important for partners to have the flexibility to make decisions and take action as needed.
3. Non-compete clauses: Including a non-compete clause in a partnership agreement can limit the partners` ability to pursue other business opportunities in the future. This can be especially problematic if the partnership dissolves or changes direction.
4. Unenforceable provisions: It is important to ensure that all provisions in a partnership agreement are legal and enforceable. Including provisions that are unenforceable can lead to confusion and unnecessary legal battles in the future.
When drafting a partnership agreement, it is important to work with an experienced attorney who can help ensure that the document is comprehensive and includes all the necessary provisions, while also avoiding any unnecessary or unenforceable clauses. By creating a strong partnership agreement, partners can establish clear expectations and avoid potential disputes down the road.