Partnership Agreement Template
Who owns what, who decides what, who gets paid what, and what happens when one of you wants out. The document every partnership needs and most only write after the argument starts.
PARTNERSHIP AGREEMENT This Partnership Agreement ("Agreement") is made on between , of , and , of (each a "Partner"). 1. FORMATION AND NAME. The Partners form a partnership under the name , with its principal place of business at . 2. PURPOSE. The Partnership carries on the business of . It will not engage in other business without unanimous written consent. 3. TERM. The Partnership begins on and continues until dissolved under this Agreement. 4. CAPITAL CONTRIBUTIONS. Each Partner contributes: : . : . Further contributions require unanimous consent and adjust ownership proportionally. 5. OWNERSHIP AND PROFIT SHARE. Partners hold the Partnership in the following shares: %, %. Profits and losses are allocated in the same shares unless agreed otherwise in writing. 6. DRAWINGS AND DISTRIBUTIONS. Partners may draw per . Remaining profits are distributed after retaining working capital agreed by the Partners. 7. MANAGEMENT AND VOTING. Each Partner has . Day-to-day decisions pass by simple majority. The following require unanimous consent: admitting a partner, borrowing more than , selling Partnership assets over , changing this Agreement, and dissolving the Partnership. 8. DUTIES AND TIME. Each Partner will devote to the Partnership and will not compete with it during the partnership. 9. BANKING AND RECORDS. Partnership funds are held in an account in the Partnership name. Books are kept at the principal place of business and are open to every Partner at any time. 10. ADMISSION OF NEW PARTNERS. A new Partner may be admitted only with unanimous written consent and on signing a deed agreeing to be bound by this Agreement. 11. WITHDRAWAL AND BUYOUT. A Partner may withdraw on days written notice. The remaining Partners may buy the departing Partner's share at times average annual profit], payable over months. 12. DEATH OR INCAPACITY. On a Partner's death or permanent incapacity, the Partnership may purchase that Partner's share on the terms in clause 11. 13. DISSOLUTION. On dissolution, assets are applied first to debts, then to return capital contributions, then to Partners in their profit shares. 14. DISPUTES. Partners will attempt mediation before commencing proceedings. 15. GOVERNING LAW. This Agreement is governed by the laws of . SIGNED: _________________________ _________________________ Date: Date:
Using this for something that matters?
This free partnership agreement covers the standard situation. If real money, property, or an ongoing relationship rides on it, a professionally drafted version, or a quick attorney review of what you've filled in, costs little and removes the guesswork.
Ask any local attorney for a fixed-fee document review, most offer one.
How to use this template
- Clause 11 is the one that matters. Partnerships rarely fail on profit share; they fail because nobody agreed in advance what a departing partner's stake is worth.
- Write down a valuation method, not a number. A number is stale in a year; a method still works in ten.
- A 50/50 split with no tiebreak is a deadlock machine. Give one partner 51%, or name a mediator in clause 14, or agree a shotgun clause.
- Without this agreement your state's default partnership act applies, which usually splits profits equally regardless of what each of you put in.
These templates are general forms for informational purposes, not legal advice, and no attorney-client relationship is created by using them. Laws vary by state and country, have a licensed attorney review any document before you rely on it.
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