THIS PARTNERSHIP AGREEMENT (the “Agreement”) effective from [dd] [MONTH] [yyyy] (the “Effective date”) is entered into by
1. [INSERT PARTNER A’s NAME], having its registered business/domicile [INSERT ADDRESS], hereinafter referred to as (the “Partner A”);
2. [INSERT PARTNER B’s NAME], having its registered business/domicile [INSERT ADDRESS], hereinafter referred to as (the “Partner B”).
The Partner A and the Partner B shall be referred to in this Agreement individually as a “Party” and collectively as the “Parties”.
WHEREAS, the Partner A and the Partner B voluntary entered into the Partnership for the pursuit of common business goals; and
WHEREAS, the Parties have considered various forms of joint business enterprises for their business activities; and
WHEREAS, the Partnership agreement as the most advantageous business form for their mutual purposes; and
WHEREAS, both Parties wish to evidence their contract in writing to set forth their rights and obligations under the Agreement; and
WHEREAS, the Parties have the capacity and are authorized to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual promises, covenants, and conditions contained herein, the sufficiency of which is hereby acknowledged, the Parties agree as follows:
1.1. Establishment. Subject to the terms and conditions hereof, the Parties hereto agree to carry on the Business in partnership.
1.2. Name. The name of the partnership shall be [NAME].
1.3. Office. The Partnership’s principle place of business shall be at [ADDRESS], unless relocated by consent of the Parties.
1.4. Duration. Subject to the provisions of this Agreement, the Partnership shall commence on the Effective Date and shall continue for a term ending on the earlier of:
(a) the date on which the Partnership is voluntarily dissolved by unanimous
agreement of the Parties; or
(b) the date on which the Partnership is dissolved by operation of law.
1.5. New Partners. Upon written consent of all the Parties, additional partners may be admitted to the Partnership under such terms and conditions (including capital contributions) as shall be determined at the time by the Parties.
1.6. Withdrawal by Partners. (a) A Party may, by notice to each of the other Parties at least [INSERT NUMBER] days prior to the last day of any fiscal year, elect to withdraw from the Partnership. The withdrawing Party’s Capital Account shall be valued as of the last day of the fiscal year in which the notice of withdrawal is given.
1.7. Assignability of Interests. The interest of a partner may be assigned or transferred in whole or in part from one Party to any other Party within the Partnership with the written consent of the Managing General Partner. Except as provided in the preceding sentence, the interest of a Party may not otherwise be assigned, pledged, hypothecated or transferred under any other circumstances except by reason of death or incapacity to that Party’s executor or administrator.
2.1. The purpose of Partnership is [PURPOSE OF THE PARTNERSHIP/ACTIVITIES] and to conduct other activities as may be necessary or incidental to or desirable in connection with the foregoing.
2.2. The Partnership shall have the power to do any act and thing and to enter into any contract incidental to, or necessary, proper or advisable for, the accomplishment or attainment of the purpose of the Partnership specified in this Agreement.
2.3. Other purposes of the Partnership shall be:
i. to own, hold, sell, develop, lease, dispose of, exchange, convert, manage, exercise voting rights with respect to, and otherwise exercise all of the rights, duties and obligations of an owner of the Partnership Property;
ii. to reinvest, in any manner and in any real or personal property which the Parties deem appropriate, all proceeds derived from the Partnership Property;
iii. to invest the Partnership Property in any manner deemed reasonable by the Parties, in any real or personal property; and
iv. to conduct any other business or make any investment which a partnership may make without violating the applicable law.
3.1. The percentage interest of each Party will be determined by dividing the balance of such Party's capital account by the total of all of the capital accounts of all Parties.
3.2. The Party’s capital contribution shall be equal to at least [INSERT AMOUNT AND CURRENCY].
3.3. The Parties listed above own the number of Capital Contribution, and the approximate percentage of interest in Capital, as listed below on Schedule “A”:
3.4. Schedule A:
3.5. The Parties shall not be permitted to make Additional Capital Contributions to the Partnership without the consent of all of the Parties.
3.6. A Partnership capital account shall be established for each Party and shall be maintained at all times throughout the existence of the Partnership. The amount in a Party's capital account shall initially be the amount of such Party's Initial Capital Contribution which shall be the fair market value of the assets such Party contributed.
3.7. No Party shall have the right to withdraw, demand a return or reduce his, her or its Capital Contribution to the Partnership. In the event a return of or reduction in the capital account of a Party is made, any amounts paid to such Party shall be reduced by all costs, fees and other expenses incurred by the Partnership in facilitating such return of or reduction in capital.
3.8. Each Party may from time to time be required to make an Additional Capital Contribution pursuant to this section. Any such contribution shall be made within thirty (30) days from the date of written notice by the Parties.
3.9. The cash and property contributed by the Parties, will be utilized by the Partnership for the purposes of the Partnership set forth in Section 2.
3.10. All property owned by the Partnership, whether real or personal, tangible or intangible, shall be deemed to be owned by the Partnership as an entity. No Party shall have any direct ownership of any Partnership property.
4.1. The Parties shall maintain complete and accurate books and records of the Party’s business and affairs. Such books and records shall be kept at the Party's registered office.
4.2. Profits or Losses for any fiscal year shall be allocated among the Parties in proportion to their ownership interests in the Partnership, unless a different allocation is agreed to in writing by all of the Parties.
4.3. The Partnership fiscal year shall be the calendar year. The Partnership’s financial records shall be kept in accordance with the cash receipts and disbursements method of accounting or in accordance with generally accepted accounting principles, at the discretion of the Parties. The Partnership shall furnish to the Parties, on a quarterly basis, accounting reports reflecting Partnership income and expenses. In addition, the Partnership shall provide the Parties with the full annual Partnership tax return for the preceding year in a timely manner to comply with all Code reporting deadlines.
5.1. Except by written agreement of all the Parties, all actions and decisions respecting the management, operation and control of the Partnership and its business (including without limitation all determinations referred to in this Agreement) may only be taken or made with the consent and agreement of Parties having an aggregate Partnership Interests of not less than [INSERT PERCENTAGE] %.
5.2. Each Party shall devote to the business of the Partnership an amount of time that is deemed necessary by that Partner’s sole judgment in order to carry out the efficient operation of the business.
5.3. Nothing in this Agreement shall be deemed to constitute any Party the agent of another Party or to limit the Parties in the carrying on of their separate respective business activities. Without limiting the foregoing it is expressly recited that any Party may engage in and possess any interest in any business or venture other than the business of the Partnership, independently or with other persons, whether or not directly or indirectly in competition with the business of the Partnership. Neither the Partnership nor any other Party shall have any rights by virtue of this Agreement to any such independent business or the income or profits derived therefrom.
6.1. All meetings of Parties shall be known and described in the notices convening such meetings as “General Meetings”.
6.2. The notice for convening General Meeting shall be given in writing and must be given not less than 20 Business Days prior to the date of such meeting, to the other Parties.
6.3. The Party convening the meeting will prepare and circulate an agenda stating the matters to be dealt with by the Party during the General Meeting. Any Party may at any time require that any matter be included on the agenda for such meetings.
6.4. The voting rights of each Party are determined by the nominal value of their capital contributions.
6.5. Each Party has one vote.
6.6. All votes at General Meeting will be taken by way of a show of hands.
6.7. All decisions within the ordinary course of business shall be made by the unanimous consent
of both Parties, when there is more than two Parties, the majority of votes prevail.
7.1. In their capacity as a Party of the business, the Parties shall be expected to participate in team discussions and development of plans. They will have the following rights:
a) Right to be represented as a Party of the Company in all communications and publicity materials;
b) Right to participate in discussions pertaining to the company;
c) Right to be involved in developing future expansion plans and strategies;
d) Right to inspect the books of accounts;
e) Right to be treated fairly; and
f) Right to have the terms of this agreement incorporated into a subsequent business structure.
7.2. Each Party shall at all times:
a) devote his whole time/as much time as is reasonably required to effectively carry out the work of the partnership business, and work diligently and use his best skill and endeavors to promote the business of the Partnership;
b) be just and faithful to the other Parties in all transactions dealings and matters in relation to the Partnership and at all times give to the other Parties a true and proper account of all such dealings;
c) keep proper records of all business transacted by him on behalf of the Partnership; and
d) punctually pay and discharge his separate debts and liabilities whether present or future and he undertakes to indemnify the other Parties and their respective estates and effects against any claims arising therefrom.
8.1. The Parties will share general responsibility for the reputation and the economic growth of the business. Currently, specific responsibilities of the Parties are as follows:
(i) Partner A
a) He/she shall be responsible for [INSERT RESPONSIBILITIES]
b) He/she shall be responsible for [INSERT RESPONSIBILITIES]
(ii) Partner B
a) He/she shall be responsible for [INSERT RESPONSIBILITIES]
b) He/she shall be responsible for [INSERT RESPONSIBILITIES]
9.1. Upon the death of any Party (hereinafter referred to as the "Decedent") the Partnership shall neither be terminated nor wound up but, instead, the business of the Partnership shall be continued as if such death had not occurred.
9.2. Each Party shall have the right by testamentary disposition to bequeath all or any portion of his or her Partnership Interest in the Partnership to a member of his or her immediate family or to any trust in which any one or more members of his or her immediate family retain the full beneficial interest; provided that in the case of any such bequest, the legatee or legatees shall hold the Partnership Interest received as a result of such bequest subject to the terms of this Agreement and shall be required to join in and execute, acknowledge, seal and deliver a copy of this Agreement as an additional Party hereto.
10.1. Each Party herewith transfers to the Company, for precautionary purposes, and the Company accepts, to the broadest extent legally possible any and all of their IP Rights that fall inside the scope of the Company’s Business, including any relevant trademark and the goodwill associated therewith, irrespective of how these rights were obtained by such Party (the “IP Transfer and Assignment”).
This IP Transfer and Assignment applies to:
(i) any and all current IP Rights of each Party that fall within the scope of the Company’s Business and
(ii) to any and all future IP Rights that fall within the scope of the Company’s Business and obtained by the Party while being a director, or officer, or employee of the Company (whichever applicable) or any of its subsidiaries (if any).
10.2. If for any legal reason the above mentioned transfer is not permissible, each Party herewith grants to the Company the exclusive, irrevocable, worldwide, unlimited as to content, time and territory, transferable and sub-licensable right to use such IP Rights that fall within the scope of the Company’s Business to the extent legally permissible in any way now known or in the future developed (the “IP License”). In particular, the IP License shall include:
(i) the right to make any publication for copyright, software and database rights purposes, to register claims under copyrights, software and database rights, and the right to renew and extend such copyrights, software and database rights, and the right to sue for past, present and future infringements of copyrights, software and database rights;
(ii) the right to permanently or temporarily reproduce the works underlying the respective IP Rights by any means and in any form, in part or in whole (including the loading, displaying, running, transmission or storage of works for the purposes of execution and processing of data or transmission to picture, sound and other data storage media),
(iii) the right to combine all or parts thereof with or add to it other works, parts of works or other information of any kind, the right to alter, modify and edit the IP Rights and to use and exploit the results achieved to the same extentd as the IP Rights itself,
(iv) the right to distribute, display and present such works and the right to make available such works to the public (for example via the Internet), to transmit and to display the works by any means, and
(v) the discretionary right to enforce the IP Rights against any person and the right to recover any proceeds or awards resulting from such enforcement.
10.3. The compensation for the assignment of and the granting of exploitation rights to the IP Rights shall be granted free of charge and the Company is not obliged to pay any fees to any Party for its use, given that the Parties participate indirectly in the proceeds from the IP Rights by means of the shares they directly or indirectly hold in the Company.
10.4. If the IP Transfer and Assignment or IP License requires any further deeds, acts or declarations to entitle the Company or its assignees to ensure the entire and exclusive use and advantages of the IP Rights each Party agrees to give and make any such deeds, acts and declarations forthwith. Any costs accruing in this context shall be borne by the Company.
10.5. The Company shall ensure that current and future employees and consultants of the Company (including the Parties) are or will be bound by the Company’s standard non- disclosure and proprietary rights assignment agreement, which shall include appropriate restrictive covenants including non-compete and non-solicitation provisions, to the extent permitted by applicable law.
The Parties agree to keep the Company’s product or service confidential; relevant disclosures will occur only on an as-needed basis and only upon consent of all Parties. The Parties shall keep the terms of this Agreement and any confidential information relating to the Company strictly confidential. Each Party acknowledges that the customer lists, trade secrets, processes, methods, and technical information of the Company and any other matters designated by the written consent of all Parties are valuable assets. Unless he or she obtains the written consent of each of the other Parties, each Party agrees never to disclose to any individual or organization, except in authorized connection with the business of the Company, any customer list, or any name on that list, or any trade secret, process, or other matter referred to in this paragraph while the Party holds, or has the control of, any shares of the Company, or at any later time.
12.1. Each Party undertakes for the entire term of this Agreement and for a period of 2 years after termination of this Agreement that without the prior written consent of all Parties he/she will not: directly or indirectly engage in any way in any business which is competitive with the Business; or
12.2. use directly or indirectly any knowledge acquired as shareholder of the Company for an activity competing with the Business; or
12.3. on his/her own behalf or for any other person, firm or company directly or indirectly offer employment to or procure employment for any person who is employed by
the Company or solicit or induce any employee of the Company to leave his/her employment with the Company; or
12.4. solicit, aid or induce any person, firm or company which has been a customer of the Company or was or is in the habit of dealing with the Company, to stop using the services of or dealing with the Company in the manner in which such person, firm or company shall have been previously accustomed.'13. Dispute Resolution
13.1. The Parties shall exhaust all effort to amicably settle any dispute which may arise pertaining to the implementation of this Agreement.
13.2. If any dispute arises under this Agreement, the Partner A and the Partner B shall negotiate in good faith to settle such dispute.
13.3. If the Parties cannot resolve such disputes themselves, the Parties agree to first try to resolve the dispute with the help of a mutually agreed-upon mediation or arbitration in [INSERT RELEVANT JURISDICTION].
13.4. Any costs and fees other than attorney fees associated with the mediation or arbitration will be shared equally by the Parties.
13.5. If the dispute is not resolved within [INSERT NUMBER OF DAYS] business days after it is referred to the mediator or arbitrary, any Party may take the matter to court.
13.6. If any court action is necessary to enforce this Agreement, the prevailing Party will be entitled to reasonable attorney fees, costs, and expenses in addition to any other relief to which the Party may be entitled.
14.1. Any issues, questions or matters arising out of this Agreement regarding but not limited to; validity, interpretation, enforcement, performance, or breach shall be governed by and construed in accordance with the internal laws of [INSERT A COUNTRY’S LAW] excluding its conflict of laws rules.
14.2. Any legal action or proceeding concerning the validity, interpretation, and enforcement of this Agreement, matters arising out of/or related to this Agreement or its making, performance or breach, or related matters shall be brought to the competent jurisdiction located in the [INSERT RELEVANT JURISDICTION].
14.3. The courts of the [INSERT RELEVANT JURISDICTION] shall have exclusive jurisdiction over any disputes.
15.1. Each of the paragraphs contained in this Agreement is unique and severable.
15.2. In the event that any section, provision or part of this Agreement shall be held to be invalid or unenforceable for any reason, the Parties agree that such invalidity will not affect the validity of the remaining provisions of this Agreement, shall continue to be valid and enforceable and further agree to substitute for the invalid provision a valid provision, which most closely approximates the intent and economic effect of the invalid provision.
15.3. If a court finds that any provision of this Agreement is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited.
16.1. A Party shall not be liable for any failure of or delay in the performance of this Agreement if such failure or delay is due to causes beyond reasonable control, including but not limited to acts of God, war, strikes or labor disputes, embargoes, government orders or any other force majeure event.
16.2. Upon the occurrence of any force majeure event, the Party relying upon this provision shall give written notice to the other Party of its inability to perform or of delay in completing its obligations.
17.1. No Party may assign, directly or indirectly, all or part of its rights or obligations under this Agreement without the prior written consent of the other Party.
17.2. Nothing in this Agreement, express or implied, will confer upon any person or entity not a Party to this Agreement, or the legal representatives of such person or entity, any rights, remedies, obligations, or liabilities of any nature or kind whatsoever under or by reason of this Agreement, except as expressly provided in this Agreement.
18.1. Good faith. All actions taken pursuant to this agreement will be made in good faith without intention to unduly deprive a Party of any interest, right or benefits.
18.2. Remedies. The parties shall have all remedies for breach of this Agreement available to them provided by law. Without limiting the generality of the foregoing, the Parties agree that in addition to all other rights and remedies available at law or in equity, the Parties shall be entitled to obtain specific performance of the obligations of each party to this Agreement and immediate injunctive relief and that in the event any action or proceeding is brought in equity to enforce the same, no Party will urge, as a defense, that there is an adequate remedy at law
18.3. Invalidity. If any of the provisions in this Agreement should be held to be invalid or unenforceable, in whole or in part, under any rule of law, such provisions or part of them shall to that extent be deemed not to form part of this Agreement but the enforceability of the remainder of this Agreement shall not be affected. Furthermore, in lieu of any such invalid or unenforceable provision, the Parties hereto hereby agree that a valid and enforceable provision, similar in terms to such invalid or unenforceable provision, shall be added to this Agreement (as an integral part thereof).
18.4. Representations and Warranties. Each Party represents and warrants that he or she is not a party to any other agreement that would restrict such Party’s ability to perform its obligations as set forth in this agreement. Each Partner represents and warrants that no third party can claim any rights to any intellectual property or other proprietary right possessed by that Party as it relates to Company’s product or service.
18.5. Notices. All notices and other communications made or to be made under this Agreement shall be given in writing but dispatched to the other Parties by e-mail:
a) Partner A’s email address: [INSERT EMAIL]
b) Partner B’s email address: [INSERT EMAIL]
18.6. Unjust Enrichment. Nothing in this Agreement precludes, blocks or otherwise eliminates a Party’s standing to bring a claim against the other Parties of Company for
unjust enrichment or other similar cause of action.
18.7. Waiver. The failure of any Party to require strict compliance with the performance of any obligations and/or conditions of this Agreement shall not be deemed a waiver of that Party’s right to require strict compliance in the future, or construed as consent to any breach of the terms of this Agreement.
18.8. Counterparts. This agreement may be executed by Parties in counterparts and may be executed and delivered by fax or other electronic means, and all such counterparts and facsimiles together constitute one agreement.
19.1. This Agreement sets forth the entire Agreement and understanding between the Parties for the purpose hereof, and there are no other promises or conditions in any other agreement whether oral or written.
19.2. This Agreement supersedes any prior written or oral agreements between the Parties.
19.3. Neither of the Parties shall be bound by any prior or contemporaneous conditions, definitions, warranties, understandings, or representation with respect to such purpose other than expressly provided herein.
19.4. This Agreement shall not be modified or changed in any manner except if mutually
agreed upon through any written amendment or instrument signed by each of the Parties.
20.1. The Parties hereby understand and expressly agree to the provisions laid down in the present Agreement and in good faith, undertake that both parties shall follow the terms of this Agreement in good conscience in order to secure better growth of both the Parties.
IN WITNESS WHEREOF, the Parties hereto have caused this Partnership Agreement to be executed as of the date stated above.