Put safeguards in place to protect you and your practice from unforeseen conflicts, giving you controls to mitigate, prevent and avoid risk.  Protect your book of business through these proper legal agreements.

The “Big Six” Agreements:

  1. Master Operating Agreement.

This document governs the entire practice from Franchisee to legal entity and how they are “bound” together. It ties together all other agreements and should be signed by all parties.

  1. LLC Operating Agreement.

This agreement governs the LLC – voting, membership rules, “S” election, triggering events, valuation, etc.

  1. Succession Agreements/Buy-Sell/Practice Interest.

These documents link the value of the individual practices with the value of the LLC, and define triggering events in case a Franchise Advisor or Associate Financial Advisor should die, become disabled or choose to leave.

  1. Service Agreement.

This document is between the LLC and you as individuals, giving the LLC the right and ability to bill for “Practice Management Services.”  It also helps protect you from the IRS determining that you are “assigning” your GDC as opposed to true billing for services between the entity and you.

  1. For Cause Employment Agreements.

These provide for compensation, benefits, etc., for owners and employees.  They ensure income stream and protection in the form of “for cause” provisions and a certain “term” and compensation level.

  1. Independent Contractor Agreements.

In certain circumstances, it may be advisable to classify an Associate Financial Advisor in your practice as an Independent Contractor, rather than as an Employee. The Independent Contractor Agreement sets forth the essential terms of this classification while providing protection from external regulatory bodies such as the IRS, DOL, and state unemployment and workers compensation bureaus. The Independent Contractor Agreement also contains a non-solicitation provision designed to protect your client base.

Final Thoughts

Don’t leave your practice to chance or to “handshake agreements.”  Take the time now to put your financial advisory house in order.


EmployShare, Inc.

A single source solution to manage and protect your practice


Contact us. We’re here to help.

Dan D’Alio, President

330.856.9770 ddalio@employshare.com