3 Key Issues To Address In A Business Agreement

Creating a successful business can be a challenge. One of the biggest challenges principles face is creating a business agreement that establishes the legal existence of the company.

Many business agreements fail to address important issues that may arise in the future.

Work with an experienced corporate attorney to ensure your business agreement will provide your new company with the stability and security needed for long-term success.

1. Delegation of Management

If you are starting a business with other individuals, you will want to ensure that your business agreement clearly outlines the delegation of management duties.

By having this delegation of duties in writing from the start, you can avoid arguments and disagreements that may arise in the future.

Each principle's management duties should be clearly outlined in the business agreement so that it's clear which individuals will be handling every aspect of managing your company as it evolves and grows.

2. Dispute Resolution

No matter how well you get along with the partners in your business, it's inevitable that you will experience some disagreements between the principle parties in the business at some point.

A good business agreement will clearly outline the approach that should be taken in regard to dispute resolution. This approach might include consulting a mediator, deferring to the senior partner, or working with a resolution expert to reach a suitable compromise.

When dispute resolution is accounted for in the business agreement, you can prevent small disagreements from compromising the overall success of your company.

3. Succession of Control

No one starts a business with the intention of leaving it or having the business fail. Unfortunately, these events do occur. If you want to protect the stability of your company over time, you will need to address the succession of control in your business agreement.

The success of control can be nuanced and challenging. An experienced corporate law firm can help you determine who will inherit the business should one of the principles pass away.

An attorney can also help you set up a payment schedule should one principle want to buy out another principle's share in the company. You can work with your attorney to create a protocol for the sale or assignment of the company as a whole.

By including the details of succession of control in your business agreement, you can streamline the succession process in the future.

Rely on a corporate attorney to help you create a comprehensive and complete business agreement when establishing your company.