PARTNERSHIP
AGREEMENT-GENERAL
THIS
AGREEMENT is made and entered into at ______________________________, this
________ day of _______________________________________, by and between
____________________________________________________ (Name And Address) and
_________________________________________________ (Name And Address) (hereafter collectively referred to as the
"Partners").
W I T N E S S E T H:
WHEREAS,
the Partners intend to ________________________________________
____________________________________________________________________.
NOW
THEREFORE, in consideration of the promises and mutual covenants made one to
the other, be it and it is hereby agreed as follows:
1. Partnership
Name and Purpose. The
parties hereto hereby form a Partnership under the name and style of
_______________________________________________ (hereafter referred to as
"the Partnership") to own real property, develop real property, and
thereafter to manage, operate, develop, mortgage, lease or sell real property
and do all other lawful things as further business of the partnership and as
may be necessary, incidental, or convenient to carry on the Partnership
business as provided herein.
2. Place
of Business. The principal
place of business of the Partnership shall be
___________________________________________________ (Location and Address) or such other place in the State of
________________ as the Partnership may hereafter, from time to time,
determine.
3. Term. The Partnership shall commence as of the
date of the execution of this Agreement and shall continue thereafter for a
term of __________ years, unless sooner dissolved and terminated by agreement
of the Partners; provided, however, that the Partnership shall not be
terminated by the bankruptcy, insolvency, appointment of trustee for the
benefit of creditors, death, incompetency, or withdrawal of any Partner, but
the remaining Partners shall have the rights and options as set forth below.
4. Capital
Contributions. Each Partner
shall contribute to the Partnership, an initial contribution of capital and
each Partner shall share in the net annual operating profits or losses of the
Partnership in the following ratio unless adjusted as hereinafter provided:
________________________________ ______________________
Partner’s
Name Contribution
________________________________ ______________________
Partner’s
Name Contribution
The
capital of the Partnership shall be the aggregate amount of capital
contributions made to it by the Partners.
The initial capital to be contributed by each Partner shall be in
cash. No Partner shall be required to
make any additional contribution to the Partnership but shall make such
additional contributions as agreed upon by a supermajority of the partners, and
directed by a written call given to each partner. For all purposes in this Agreement, a supermajority vote of the
partners shall be a vote of at least five partners.
If
any Partner fails to contribute the additional capital required of him within
thirty (30) days after written call for contribution, the other Partners shall
be given the opportunity to contribute amounts that will equal the assessment
in default. They shall contribute
amounts equaling the assessment in default in a proportion commensurate with
the proportion of the capital interest in the Partnership of the non-defaulting
Partner(s) prior to the call for additional contributions or in any other
proportions that they may determine.
The allocation of profits or losses among all the Partners shall be
adjusted according to the change in capital contributions by the partners.
Contributions
to the capital of the Partnership shall not bear interest. However, any advance of money to the
Partnership by any Partner in excess of the amounts provided for in this
Agreement or subsequently agreed to as a Capital Contribution shall not be
deemed a Capital Contribution to the Partnership, but a debt due from the Partnership,
and shall be repaid with interest at such rates and times as determined by a
supermajority of the Partners. Such
debts may have preference or priority over any other payments to Partners as
may be determined by a supermajority of the Partners.
5. Capital
Accounts. A separate capital
account shall be maintained for each Partner, and capital contributions to the
Partnership by the Partners shall be charged to such accounts. Partnership profits or losses shall also be
charged or credited to the separate capital accounts in the manner herein
before provided. No interest shall be
paid on the capital account of any Partner.
6. Cash
Distributions. Any amounts
held by the Partnership and not required for purposes of its business,
including reasonable reserves for contingencies, may be distributed to the
Partners pursuant to the terms hereof.
No Partner shall be entitled to make withdrawals from his individual
account or have returned to him his capital contributions except in accordance
herewith. No Partner shall have the
right to require that a distribution be made to him other than in cash.
7. Banks
and Books of Account. The
funds of the Partnership shall be kept in a separate account or accounts in a
bank and/or savings institution in the name of the Partnership. All withdrawals from such accounts shall be
made upon checks or drafts signed by any Partner.
Full
and complete books of account shall be kept and maintained at the principal
place of business and all transactions shall be entered in such books. Each Partner shall have access and the right
to inspect and copy such books and all other Partnership records. The books shall be closed at the end of each
calendar year and statements prepared showing the financial condition of the
Partnership and its profit or loss.
8. Managing Partners. In the general conduct of the Partnership
business, all the Partners shall be consulted and the advice and opinions of
the Partners shall be obtained so much as is practicable. However, for the purpose of fixing and
harmonizing the policies and practices of the Partnership and of securing
uniformity and continuity in the conduct of its business, the general
management of the Partnership business shall rest solely in the Managing
Partners. The Managing Partners shall
be: _____________________________________________________ (Name and Address).
_____________________________________________________
(Name and Address).
Except
in cases of gross negligence or willful misconduct, the doing of any act or the
failure to do any act by the Managing Partners, the effect of which may cause
or result in loss or damage to the Partnership, shall not subject the Managing
Partners to any liability to the remaining Partners or to the Partnership. In the event of the death, physical or
mental incapacity, or withdrawal of either Managing Partner from the
Partnership, the surviving Partners shall have equal rights in the management
of the Partnership and shall appoint successor Managing Partners.
Except
as otherwise provided herein, no Partner shall make any contract for and on
behalf of the Partnership without the prior approval of the other
Partners. All contracts shall be made
in the name of the Partnership and in the case of any disagreement as to the
making of any contract or assumption of any obligation by the Partnership, such
contract or obligation shall not be made or executed except as directed by a
supermajority of the Partners; further, no Partner shall release nor cancel any
indebtedness or obligation due the Partnership, except on full payment thereof,
or upon the mutual agreement of all the Partners, nor shall any Partner give,
extend, or guarantee credit to or for any person, firm, corporation without the
consent of all the Partners, nor at any time shall any Partner sign the firm
name nor pledge the firm's credit nor in any other manner act as surety or
guarantor in any paper, bill, bond, note, or draft or other obligation
whatsoever, nor assign pledge, mortgage, sell or otherwise dispose of, any
Partnership property or any interest therein or do anything or permit any act
whereby the Partnership's money, interest, or property or its interest therein,
may be liable to seizure, attachment, or execution, except upon mutual consent
of all the Partners.
9. Relationship
of the Partners. Each
Partner may have other business interests and may engage in any other business,
trade, profession, or employment whatsoever on his own account or in
partnership with, as an employee of, or as an officer, director, or stockholder
of any other person, firm, or corporation (whether competitive with the
Partnership or otherwise) and he shall not be required to devote his entire
time to the business of the Partnership.
Each Partner shall devote such time and attention to the conduct of the
business of the Partnership as shall be deemed by all of the Partners to be
required for the business of the Partnership.
No
Partner shall receive any salary or other special compensation or services
rendered by him as Partner of the Partnership, except as otherwise agreed by
all the Partners. Notwithstanding the
foregoing, each Partner shall be permitted to do business with the Partnership
and with any other Partner individually or with any business entity in which
such Partner may have an interest.
It
is understood that each of the parties hereto are Partners for the purpose of
this Partnership as set forth in Paragraph 1 hereof, but nothing contained in
this Agreement shall make the partners with respect to matters unrelated to the
Partnership, or render them liable for any debts or obligations of any Partner,
nor shall any Partner be hereby constituted the agent for any Partner except to
the limited extent herein specifically permitted and as may be hereinafter
agreed upon by consent of all the parties.
10. Waiver of
Right to Partition. Each
Partner hereto hereby waives his right to partition (or to separately assert
any right to partition under the statutes of the State of ________________
pertaining to partition) any real property owned by the Partnership.
11. Voluntary
Termination. The Partnership
may be dissolved at any time by agreement of a supermajority of the Partners,
in which event the partners shall proceed with reasonable promptness to
liquidate the business of the partnership.
The assets of the partnership and proceeds of liquidation shall be
applied in the following order:
(a) To
the payment of or provision for all debts, liabilities and obligations of the
Partnership to any person (other than Partners) and the expenses of
liquidation;
(b) To
the payment of all debts and liabilities (including interest) to the Partners
(except those on account of their capital contributions);
(c) To
the discharge of the balance of the income accounts of the Partners;
(d) To the payment of the capital accounts of the
Partners, less any previous distributions and any losses charged or chargeable
to the capital accounts of the Partners and increased by any income or gains
credited to such capital accounts; and
(e) Between
the Partners in the same proportion as their percentages of interest in the
Partnership as set forth in Paragraph 4.
Notwithstanding
any other provisions of this Paragraph 11, if, upon ultimate liquidation of the
Partnership, the foregoing allocations would leave any Partner with a deficit
in his capital account that is not to be repaid to the Partnership, then, such
allocation shall be modified so that, to the extent possible, the amount of
total gain (including the portion of any cancellation of indebtedness income
not excluded by an election under Internal Revenue Code Sections 108 and 1017)
allocated to such Partner is sufficient to eliminate such deficit. If there are several Partners with such
deficits and the total gain is less than the aggregate deficits, such gains
shall be allocated in proportion to, but not in excess of, their respective
deficits.
12. Retirement. No Partner may retire from the Partnership
for a period of ____ years from the date of this Agreement. After said period, any Partner shall have
the right to retire from the Partnership at the end of any calendar month. Written notice of intention to retire shall
be served upon the remaining Partners at least __________ days before the first
day of the month in which the retiring Partner intends to retire. The retirement of such Partner shall have no
effect upon the continuance of the Partnership business. If the remaining
Partners elect to purchase the interest of the retiring Partner, the Partners
shall serve written notice of such election upon the retiring Partner within
_______ days after receipt of the retiring Partner's notice of intention to
retire, and the purchase price and method of payment for the Partnership
interest shall be as provided in Paragraph 14 hereof. If the remaining Partners elect not to purchase the interest of
the retiring Partner, then the Partners shall proceed with reasonable promptness
to liquidate the business of the Partnership.
13. Involuntary
Withdrawal. Any Partner may
be required to withdraw from the Partnership upon the happening of any of the
following events:
(a) If
any Partner makes an assignment for the benefit of creditors or applies for the
appointment of a trustee, a liquidator or receiver of any substantial part of
his assets or commences any proceeding relating to himself under any
bankruptcy, reorganization, or arrangement of similar law; or if any such
application is filed or proceeding is commenced against any Partner and such
Partner indicates his consent thereto, or an order is entered appointing any
such trustee, liquidator or receiver, or approving a petition in any such
proceeding and such order remains in effect for more than sixty (60) days; then
that Partner shall be deemed to have withdrawn from the Partnership as of the
date of the happening of any such event.
(b) If
any Partner shall be adjudged incompetent, then such Partner shall be deemed to
have withdrawn from the Partnership on the date set forth in a notice to such
incompetent Partner from the remaining Partners.
1
The
value of the Partnership interest in the Partnership of any Partner who shall
be required to withdraw from the Partnership as provided in this paragraph, and
the method of payment for the Partnership interest shall be as provided in
Paragraph 14 hereof.
14. Death of
a Partner. Upon the death of
a Partner, the Partnership shall not terminate, and the business of the
Partnership shall be continued to the end of the fiscal year in which such
death occurs. The estate of the
deceased Partner shall share in the net profits or losses of the Partnership
for the balance of the fiscal year in the same manner the deceased Partner
would have shared in them had he survived to the end of the fiscal year, but
the liability of the estate for losses shall not exceed the deceased Partner's
interest in the Partnership assets at the time of his death. The estate of the deceased Partner shall
have no voice in the affairs of the Partnership. At the end of the fiscal year, the surviving Partners shall have
the option either to liquidate the Partnership or to purchase the interest of
the deceased Partner.
(a) If
the surviving Partners elect to purchase the interest of the deceased Partner,
they shall serve notice in writing of such election within _______ months after
the death of the Partner upon the Executor or Administrator of such deceased
Partner's estate, or if at the time of such election no such legal
representative has been appointed, upon any one of the known legal heirs of the
decedent at the last known address of such heir. The purchase price shall be equal to the deceased Partner's
capital account as of the end of the month next preceding the date of his death
plus the deceased Partner's income account as of said date, adjusted for the
deceased Partner's share of profits not previously distributed or losses not
previously charged to either of said accounts through the end of the month next
preceding death. No allowance shall be
made for goodwill, trade name, patents or other intangible assets, except as
those assets have been reflected on the Partnership books immediately prior to
termination; but the surviving Partners shall nevertheless be entitled to use
the trade name of the Partnership. The
capital account of the deceased Partner shall be adjusted to reflect the fair
market value of all Partnership land and improvements located thereon and fixtures
affixed thereto, the same to be determined by an independent appraiser selected
by the parties for this purpose, whose determination shall be final and binding
upon all interested parties. The
purchase price shall be paid within ________ year(s) of the death of the
deceased partner and shall bear interest at the rate of ________ percent per
annum thereafter. In the event no
agreement can be made on who shall be the appraiser, then the value shall be
established by three appraisers, one selected by the deceased partner's estate,
one selected by the remaining partners and a third appraiser selected by those
two appraisers. The Partners intend
that the payments for the deceased Partner's capital account shall be distributions
under Section 736(b) of the Internal Revenue Code, and that payments for
undistributed profits shall be a distributive share of the Partnership income
or a guaranteed payment under Section 736(a) of the Internal Revenue Code.
(b) If
the surviving Partners do not elect to purchase the interest of the deceased
Partner, they shall proceed with reasonable promptness to liquidate the
Partnership. During the period of
liquidation, the surviving Partners and the estate of the deceased Partner shall
share in the profits and losses of the business in the same manner that they
would have shared in them had the deceased Partner survived to the end of the
fiscal year, except that the deceased Partner's estate shall not be liable for
losses in excess of the deceased Partner's interest in the Partnership assets
as of the time of his death. Except as
herein otherwise stated, the procedure as to liquidation and distribution of
the assets of the Partnership business shall be the same as stated in Paragraph
11.
The
parties agree that the provisions contained herein with respect to the
discharge of a deceased Partner's interest in the Partnership are in lieu of
the provisions of ____________________________________ (State Statute)(Uniform Partnership Act))
and
shall exclusively govern the disposition of and accounting for the interest of
a deceased Partner in the Partnership.
15. New
Partners. No person shall be
admitted as a Partner of the Partnership except with the consent of all the
Partners who shall determine the terms and conditions upon which such admission
is to be effective.
16. Prohibition
on Transfer. A Partner shall
not, and shall have no right, to sell, assign, pledge or mortgage his interest
in the Partnership, or the Partnership property or assets, except with the
written consent of all the Partners, and any such prohibition transfer, if
attempted, shall be void and without force or effect.
17. Entire
Agreement. This Agreement
contains the entire understanding of the parties hereto and may not be modified
or amended except by a writing signed by the parties to be charged therewith.
18. Controlling
Law. This Agreement shall be
controlled by and construed in accordance with the laws of the State of
______________________.
19. Successors
and Assigns. Subject to the
restrictions set forth herein, this Agreement shall inure to the benefit of and
be binding upon the heirs, personal representatives, successors and assigns of
the parties.
IN
WITNESS WHEREOF, the parties hereto have set their hands and seals the date and
place first above mentioned.
_______________________________ _________________
Signature
of Partner Date
_______________________________ _________________
Signature
of Partner Date
