Llp - profit sharing pattern
This query is : Resolved
30 November 2015
Dear Sir/Madam
I want to incorporate LLP, where the client wants to have different profit sharing ratio, that means, at the time of incorporation one particular sharing pattern and while wounding up some other profit sharing pattern. Is this possible in LLP Agreement.
01 December 2015
Technically it is not possible, because Form will not accept different profit sharing ratio.
However, you can have one clause in LLP Agreement stating that
'In case of winding up, all partners are required to enter into Addendum/Supplementary Agreement, for revising Profit Sharing Ratio before closing/winding up of LLP.
So practically, when partners decides to wind up, they can enter into Supplement Agreement with 'new profit sharing ration' and once the Supplement Agreement is approved by ROC, LLP can apply for winding up.
I hope this will help.
However, you can have one clause in LLP Agreement stating that
'In case of winding up, all partners are required to enter into Addendum/Supplementary Agreement, for revising Profit Sharing Ratio before closing/winding up of LLP.
So practically, when partners decides to wind up, they can enter into Supplement Agreement with 'new profit sharing ration' and once the Supplement Agreement is approved by ROC, LLP can apply for winding up.
I hope this will help.
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