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PARTNERSHIP AGREEMENT
This PARTNERSHIP AGREEMENT is made on ____________, 20__ between
__________________________________________ and __________________________________________
of _____________________.
1. NAME AND BUSINESS. The parties
hereby form a partnership under the name of __________________________________________
to conduct a __________________________________________. The
principal office of the business shall be in _______________________.
2. TERM. The partnership shall
begin on ________________, 20____, and shall continue until
terminated as herein provided.
3. CAPITAL. The capital of the
partnership shall be contributed in cash by the partners as
follows: A separate capital account shall be maintained for
each partner. Neither partner shall withdraw any part of his
capital account. Upon the demand of either partner, the capital
accounts of the partners shall be maintained at all times in
the proportions in which the partners share in the profits and
losses of the partnership.
4. PROFIT AND LOSS. The net profits
of the partnership shall be divided equally between the partners
and the net losses shall be borne equally by them. A separate
income account shall be maintained for each partner. Partnership
profits and losses shall be charged or credited to the separate
income account of each partner. If a partner has no credit balance
in his income account, losses shall be charged to his capital
account.
5. SALARIES AND DRAWINGS. Neither
partner shall receive any salary for services rendered to the
partnership. Each partner may, from time to time, withdraw the
credit balance in his income account.
6. INTEREST. No interest shall
be paid on the initial contributions to the capital of the partnership
or on any subsequent contributions of capital.
7. MANAGEMENT DUTIES AND RESTRICTIONS.
The partners shall have equal rights in the management of the
partnership business, and each partner shall devote his entire
time to the conduct of the business. Without the consent of
the other partner neither partner shall on behalf of the partnership
borrow or lend money, or make, deliver, or accept any commercial
paper, or execute any mortgage, security agreement, bond, or
lease, or purchase or contract to purchase, or sell or contract
to sell any property for or of the partnership other than the
type of property bought and sold in the regular course of its
business.
8. BANKING. All funds of the partnership
shall be deposited in its name in such checking account or accounts
as shall be designated by the partners. All withdrawals therefrom
are to be made upon checks signed by either partner.
9. BOOKS. The partnership books
shall be maintained at the principal office of the partnership,
and each partner shall at all times have access thereto. The
books shall be kept on a fiscal year basis, commencing _____________________
and ending _____________________, and shall be closed and balanced
at the end of each fiscal year. An audit shall be made as of
the closing date.
10. VOLUNTARY TERMINATION. The
partnership may be dissolved at any time by agreement of the
partners, in which event the partners shall proceed with reasonable
promptness to liquidate the business of the partnership. The
partnership name shall be sold with the other assets of the
business. The assets of the partnership business shall be used
and distributed in the following order: (a) to pay or provide
for the payment of all partnership liabilities and liquidating
expenses and obligations; (b) to equalize the income accounts
of the partners; (c) to discharge the balance of the income
accounts of the partners; (d) to equalize the capital accounts
of the partners; and (e) to discharge the balance of the capital
accounts of the partners.
11. DEATH. Upon the death of either
partner, the surviving partner shall have the right either to
purchase the interest of the decedent in the partnership or
to terminate and liquidate the partnership business. If the
surviving partner elects to purchase the decedent's interest,
he shall serve notice in writing of such election, within three
months after the death of the decedent, upon the executor or
administrator of the decedent, or, if at the time of such election
no legal representative has been appointed, upon any one of
the known legal heirs of the decedent at the last-known address
of such heir. (a) If the surviving partner elects to purchase
the interest of the decedent in the partnership, the purchase
price shall be equal to the decedent's capital account as at
the date of his death plus the decedent's income account as
at the end of the prior fiscal year, increased by his share
of partnership profits or decreased by his share of partnership
losses for the period from the beginning of the fiscal year
in which his death occurred until the end of the calendar month
in which his death occurred, and decreased by withdrawals charged
to his income account during such period. 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 the decedent's death; but the survivor
shall nevertheless be entitled to use the trade name of the
partnership. (b) 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 10 with reference
to voluntary termination.
12. ARBITRATION. Any controversy
or claim arising out of or relating to this Agreement, or the
breach hereof, shall be settled by arbitration in accordance
with the rules, then obtaining, of the American Arbitration
Association, and judgment upon the award rendered may be entered
in any court having jurisdiction thereof. In witness whereof
the parties have signed this Agreement.
Executed this ______________ day
of _________________, 20_____ in _____________________ [CITY],
_____________________ [STATE].
_______________________________________________________
_______________________________________________________
