How to Create a Partnership Agreement in Kentucky
A Partnership Agreement is also known as:
Business Partnership Agreement
General Partnership Agreement
Articles of Partnership
A partnership is a business relationship between two or more people/organizations who agree to do business together, sharing in the profits and the losses of the business. The Partnership Agreement in Kentucky lays out the guidelines to be enforced by the partners to ensure the continuity and the success of the partnership. All matters affecting the partnership from profit/loss sharing and voting rights, to termination and buyout procedures are covered and governed by the clauses in the Agreement.
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You don’t need a lawyer to create a Partnership Agreement in Kentucky. You can create a Business Partnership Agreement in minutes using our free Partnership Agreement form, and you don’t have to get the document notarized for it to be enforceable. All it requires is the signatures of the partners. To get started, simply enter your information above, or read on for more details.
Essentials of a Partnership Agreement in Kentucky
In addition to basic partnership details, such as the name and the purpose of the business partnership, to the location of the business and the details of the named partners, a Partnership Agreement typically includes the following information.
The capital contributions of the partners are essential in establishing partners’ equity or ownership stake in the partnership, and in most cases, the contributions from each partner will determine the partners’ share of the profits/losses. Real estate, personal property, and client lists also qualify as partner contributions.
Allocation of Profits/Losses
The Partnership Agreement also stipulates how and when the profits and losses of the partnership will be calculated and distributed and whether partners agree to the reinvestment of profits and the percentage of reinvested profits.
This section of the Contract outlines the voting procedures applicable in the partnership, when voting is essential, and the decisions that can only pass through unanimous voting.
Management Partner and Tax Matters Partner
The Partnership Agreement should name a Managing Partner to oversee the day-to-day running of the business, as well as a Tax Matters Partner designated to represent the partnership to the IRS, along with acceptable accounting methods and financial reporting practices.
The Business Partnership Agreement typically includes a clause on how certain disputes between the partners will be resolved. A mediation clause may compel the partners to seek professional mediation services from independent/certified third parties to help in the resolution of certain conflicts among the partners.
Partners’ Withdrawal, Termination or Death
The legal Partnership Contract stipulates the conditions to be met for withdrawal from the partnership, handling of the withdrawing partner’s stake, and the buyout processes, where necessary. This clause also addresses the steps following the death of a partner, as well as the actions that would necessitate the termination of a partner’s stake in the partnership.
Adding New Partners
If the partnership is open to new partners in the future, the procedures for admitting new partners must be specified in this contract. This section should also address the effects of the additional partners on the partnership’s ownership structure, adjustment to partners’ responsibilities, and whether voting is essential for the admission of new partners or not.
Dissolution of Partnership
This section of the Contract stipulates the conditions/terms for the dissolution of the partnership. Some of these conditions include the death of a partner, bankruptcy, or meeting set goals.
Our site helps you create a Kentucky Partnership Agreement. We offer free on-line templates and Partnership Agreement samples that make it easy. Simply fill in the information above to get started.
Whether you’re doing business in Bowling Green, Louisville, Frankfort, Lexington, Owensboro, Paducah, or any other city in Kentucky, you can download our free Partnership Agreement form and start creating yours today.