The Utah partnership agreement is a legal document that defines all the details of how the partners will operate within their business organization. It includes information about the initial contribution of each partner and their rights and duties in the partnership based on their contribution.
The partnership agreement, or partnership contract, is often used in the process of a business expansion or in the business loan application process before the financial institution.
In these situations, third parties often require the partnership agreement so they can get familiar with the structure and organization of the business partnership before deciding to move forward with their cooperation.
In Utah, the partnership agreement is also commonly called the partnership deed or the articles of partnership.
Utah Partnership Agreement Types
This section provides different types of partnership agreements that can be used in Utah:
Types of Purchase Agreement
General Partnership (GP): This type of partnership enables all partners to participate in the decision-making process. However, they are liable with all of their personal assets for the business operation. (§ 401 to § 409)
Limited Partnership (LP): Here, the partnership is formed between the general partners, who have decision-making powers and have unlimited liability for the operation of the partnership, and the limited partners, who don’t have decision-making powers but have limited liability for the partnership. (§ 301 to § 306)
Limited Liability Partnership (LLP): It enables all partners to have equal decision-making powers. Moreover, partners are not liable for the damages caused by the negligence and actions of other partners. (§ 1101 to § 1109)
Utah Partnership Agreement Requirements
In Utah, the partnership agreement format will include the following elements:
Partner’s full names and mailing addresses.
Name and registered address of the partnership
Partnership establishment date
Details about each partner’s initial investment in the partnership
Information about each partner’s management and voting rights
Rules on profit distribution
Information about the accounts of the partnership
Conditions that must be fulfilled before the eventual partnership expansion
Details on how the partners will cover eventual losses