Partnership agreements are foundational documents that outline the terms and conditions of a business partnership, ensuring that all parties involved are on the same page regarding their roles, responsibilities, and expectations. A well-crafted partnership agreement can help prevent misunderstandings and disputes, providing a clear framework for decision-making and the distribution of profits and losses. Below is a sample partnership agreement that highlights key elements and considerations. This sample is intended for educational purposes and should be tailored to fit the specific needs and circumstances of any potential partnership.
Article 1: Introduction
1.1 Partnership Name: The name of the partnership shall be [Partnership Name], hereinafter referred to as “the Partnership.”
1.2 Business Purpose: The purpose of the Partnership is to [briefly describe the business or venture], as outlined in the business plan dated [Date of Business Plan].
1.3 Duration: The Partnership shall commence on [Start Date] and shall continue until terminated as provided in this Agreement.
Article 2: Partners
2.1 List of Partners: The partners to this Agreement are: - Partner 1: [Name], with an address at [Address]. - Partner 2: [Name], with an address at [Address]. - Partner 3: [Name], with an address at [Address].
2.2 Capital Contributions: Each partner shall contribute to the capital of the Partnership in the following amounts: - Partner 1: [Amount] - Partner 2: [Amount] - Partner 3: $[Amount]
2.3 Ownership Percentages: The ownership percentage of each partner in the Partnership shall be based on their capital contribution, as follows: - Partner 1: [Percentage]% - Partner 2: [Percentage]% - Partner 3: [Percentage]%
Article 3: Management and Operation
3.1 Decision-Making: All major decisions regarding the Partnership shall be made by a unanimous vote of the partners. Minor decisions may be made by the managing partner, as designated below.
3.2 Managing Partner: [Name of Partner] shall act as the managing partner and shall be responsible for the day-to-day operations of the Partnership.
3.3 Roles and Responsibilities: Each partner’s roles and responsibilities are as follows: - Partner 1: [Brief description of roles and responsibilities] - Partner 2: [Brief description of roles and responsibilities] - Partner 3: [Brief description of roles and responsibilities]
Article 4: Financial Provisions
4.1 Profit and Loss Sharing: The profits and losses of the Partnership shall be shared among the partners in accordance with their ownership percentages.
4.2 Accounting and Audit: The Partnership’s accounting records shall be maintained by [Name of Partner or External Accountant] and shall be subject to annual audits by an independent auditor.
4.3 Fiscal Year: The fiscal year of the Partnership shall end on [Date], unless otherwise agreed upon by the partners.
Article 5: Dispute Resolution
5.1 Mediation: In the event of any dispute arising out of or in connection with this Agreement, the parties agree to attempt to resolve such dispute through mediation before resorting to arbitration or litigation.
5.2 Arbitration: If mediation is unsuccessful, disputes shall be resolved through binding arbitration in accordance with [Arbitration Rules], as amended from time to time.
Article 6: Termination
6.1 Voluntary Termination: The Partnership may be terminated by a unanimous vote of the partners.
6.2 Involuntary Termination: Upon the death, bankruptcy, or incapacity of any partner, the remaining partners may choose to either dissolve the Partnership or continue its operations, as provided in this Agreement.
6.3 Notice of Termination: Written notice of termination shall be given to all partners, and the Partnership shall be wound up in accordance with the provisions of this Agreement and applicable laws.
Article 7: Confidentiality and Non-Disclosure
7.1 Confidential Information: All partners agree to keep confidential any information regarding the Partnership’s business, operations, and financial affairs.
7.2 Non-Disclosure: Partners shall not disclose any confidential information to third parties without the prior written consent of all partners.
Article 8: Governing Law
8.1 Jurisdiction: This Agreement shall be governed by and construed in accordance with the laws of [State/Country].
8.2 Venue: Any legal action arising out of or related to this Agreement shall be brought in the [Court Name] of [State/Country].
Article 9: Amendments
9.1 Amendment Procedure: This Agreement may be amended only in writing signed by all partners.
9.2 Notice of Amendment: Written notice of any amendment shall be provided to all partners.
Conclusion
In witness whereof, the parties have executed this Partnership Agreement as of the date first above written.
Signature Page
- Partner 1: _____________________________ Date: _____________________________
- Partner 2: _____________________________ Date: _____________________________
- Partner 3: _____________________________ Date: _____________________________
Note: This sample partnership agreement is a simplified version and should be reviewed and customized according to the specific needs and circumstances of the partnership. It is also advisable to consult with a legal professional to ensure that the agreement complies with relevant laws and regulations.
