Why Should A Partnership Agreement Be In Writing

It may be important to have a written partnership agreement for many reasons in order to complement what this law provides, the least of which is to establish the terms of the agreement between the parties. Other situations that should be addressed in a partnership agreement are competitive refinement and confidentiality. Provisions that prevent a partner from sharing the company`s confidential information with others or seeking employment with a competitor are crucial for a company to maintain a competitive advantage and protect the investments of all partners. If the profit sharing is not to be the same, this must be specified in written statutes. The agreement should also specify whether losses are to be shared in the same way as profits. Partnership agreements should also include provisions that protect majority shareholders.