it is critical to have a well-drafted owners agreement to guide your company. bylaws and operating agreements deal with the internal management of the business, like rules and regulations for how it operates. the owners could be the members and managers of an llc, the partners in a partnership, or the shareholders. they may also have ex-spouses who try to go after the business in the divorce. with an owners agreement, you can plan for these issues and ensure that the ownership interest does not wind up in the wrong hands. an owners agreement can help the owners agree on what should and shouldn’t be allowed, in terms of competing with the business you’ve built together.

according to an ownership agreement, a co-owner owns a percentage of an asset, although the amount may vary. the relationship between co-owners can also widely vary. the legal and financial obligations for each party ultimately depends on what each person wants to receive. for example, an owner who decides to make another individual a co-owner of their company may not end up liking the way they run the business. consider the situation where a co-owner who has access to business funds irresponsibly gambles away significant sums of money on casino credit. there is a difference between the terms “partner” and “co-owner” with regards to a business ownership. personal liability of a co-owner is limited to the number, type, and value of company-issued stock owned.