What things should I consider before entering into a partnership and should I seek the assistance of a lawyer?

Entering into a partnership can be a significant decision for any business owner, and it is important to carefully consider all the relevant factors before proceeding. Here are some things to consider before entering into a partnership:

  1. Goals and expectations: Ensure that you and your potential partner share common goals and expectations for the partnership. Discuss your long-term goals, as well as your expectations regarding each other’s roles and responsibilities.
  2. Legal structure: Determine the legal structure of your partnership. You may choose to form a general partnership, limited partnership, or limited liability partnership. Each structure has its own advantages and disadvantages, and it is important to choose the structure that best suits your needs.
  3. Contributions: Determine each partner’s contribution to the partnership, including financial contributions, labor, skills, and expertise.
  4. Profit and loss sharing: Determine how profits and losses will be shared between partners. Will profits and losses be divided equally, or will each partner receive a percentage based on their contributions?
  5. Decision-making: Determine how decisions will be made within the partnership. Will decisions be made jointly, or will each partner have specific decision-making authority in certain areas?
  6. Exit strategy: Develop an exit strategy that outlines what will happen if one partner wants to leave the partnership. This may include a buyout agreement, dissolution of the partnership, or other provisions.
  7. Legal agreements: It is important to have a partnership agreement in place that outlines the terms and conditions of the partnership. This agreement should cover all of the above factors, as well as other relevant issues such as dispute resolution and intellectual property ownership.

Seeking the assistance of a lawyer can be very helpful in navigating these issues and ensuring that your partnership agreement accurately reflects the terms of the partnership. A lawyer can also provide advice on the legal implications of forming a partnership and help you understand the risks and benefits of entering into a partnership agreement. If you have any questions please contact us at info@falconlawyers.ca or 1-877-892-7778.

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