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The Tennessee partnership agreement is a legal document that outlines all the rules for how the partnership will be structured and operated after its establishment.
Even though the partnership agreement or partnership deed is not always required for the establishment of the business partnership, the partners often choose to make one since federal and state laws don’t provide very detailed regulations on how the business partnership should be operated.
Therefore, the partners often choose to create this type of document to customize and provide more specific regulation within the framework of federal and state laws and determine the relationship between the partners in the business partnership.
The Tennessee partnership agreement is also referred to as the “partnership contract” or the “articles of partnership.”
Tennessee Partnership Agreement Types
In Tennessee, there are several types of partnership agreements that partners can choose from:
Types of Purchase Agreement
General Partnership (GP): Here, all partners can participate in the decision-making process. However, they are all responsible for the liabilities of the partnership with all of their personal assets. (§ 61-1-101 to 61-1-1208)
Limited Partnership (LP): This is a partnership between the general partners, who have decision-making powers and are fully liable for the partnership operations with all of their personal assets, and the limited partners, who have limited liability for the partnership operation and have limited decision-making powers. (§ 61-1-101 to 61-1-1208 and § 61-3-301 to § 61-3-306)
Limited Liability Partnership (LLP): Here, all partners can equally participate in the decision-making process, and their liability is limited only to the decisions they have personally made. (§ 61-1-1001 to § 61-1-1006)
Tennessee Partnership Agreement Requirements
In Tennessee, the partnership agreement format will include the following elements:
Details about the partners
Name and registered address of the business partnership
Partnership establishment date
Details about each partner’s initial contribution
Information about each partner’s management and voting rights
Rules on profit distribution
Details on how the partners will cover eventual losses