Corporate governance documents are essential in any business enterprise with more than one owner, as they provide the framework for internal operations. At J&J Legal, our goal is to provide the solve and avoid a one size fits all approach to corporate governance documents. While blank and boilerplate forms can be found online, these documents should be tailored to address the unique needs of your industry and your particular business enterprise. Because every business is unique, key issues such as decision making, capital contributions, salaries, distributions, and dissolution vary immensely among owners and industries. Additionally, because the needs of your business evolve over time, it is important to consider amending these documents to ensure they continue to serve your company’s interests.
A partnership agreement memorializes the terms and conditions of the partnership relationship in a written contract. Partnership agreements should be prepared at the inception of the partnership to spell out the percentage of ownership, distribution of profits and losses, managerial duties of each partner, the partnership’s duration, ways to terminate the partnership, and procedures for a buy-out in the event of disability, death, divorce, etc. At J&J Legal, we understand the eventualities that can arise during the course of a partnership. Our attorneys can help you avoid legal and liability issues later on by preparing a partnership agreement that answers all the critical “what if” questions.
Bylaws and Operating Agreements
Bylaws and operating agreements are used by corporations and limited liability companies (LLCs), respectively, to dictate various internal operating procedures—from books and recordkeeping to handling disputes among owners, officers, directors, and/or managers. These documents should define and control how the business will be operated because they are the quintessential “rule book” by which the business runs its corporate affairs.
Bylaws do not address the day-to-day operations details handled by executive directors and other employees but rather, the principles, frameworks and policies for the overall governance of the corporation how that structure is maintained; how many directors will serve at one time, what their qualifications are, what they are to do, when they meet, what they can delegate to others and what they cannot, what committees are authorized, how committees function and what power they have over what matters, how directors and committee members are held accountable, and who the officers are, together with their job descriptions. In addition, the bylaws frequently contain key policies regarding conflict of issues procedures, duties of loyalty, and overall guiding financial principles.
Similarly, operating agreements outline an LLC’s financial and functional decisions and govern the internal operations of the LLC. Operating agreements are essential to achieve the personal liability protections afforded by this type of business entity because without them, a business can be considered a sole proprietorship or partnership. Business owners can rely on J&J Legal to prepare an operating agreement that suits their specific needs, considering the percentage of members’ ownership, voting rights preferences, desired powers and duties of members and managers, and vision for buyout and ownership transfer procedures.
Contact J&J legal today. We are dedicated to providing the solve to your corporate governance needs and protecting your assets.