The increasingly popular alternative to a company structure, a few things to consider...
Everything feels simpler in a limited partnership and we can see why it’s popular with silent investors. They don’t have to worry about managing the business, or their name being on a public register and financially, there’s benefits of flow-through. On the other hand, great responsibility falls on the people managing these investor funds and that’s where good legal advice is valued.
Discuss with Janey on what will be relevant for you so that she can prepare a limited partnership agreement specific for your business.
- Private governance document for both the general partner and limited partners.
- Fit for business type.
- When the partnership needs capital, does it first seek it from its limited partners or a bank?
- What reporting is available?
- Valuation methods.
- What happens when limited partners come and go?
- How are units protected from dilution?
- Does a limited partner have any say on how the partnership business operates?
- Distribution policy.
- Flow through tax.
- Limited partner indemnities.
- Privacy from public records.