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The Partnership Deed is a legal document that establishes a partnership between Party 1, Party 2, and Party 3. The purpose of the partnership is to conduct business in a specific territory under the name of the partnership. The partners wish to regulate their relationship and the management of the partnership according to the terms of this deed.
The document begins with an interpretation section, defining various expressions used throughout the deed. It includes definitions for accounting period, affiliate, accounts, auditors, budget, business day, business plan, director, effective date, executive manager, partners, partnership board, partnership interest, partnership, percentage share, and more.
The deed then covers the commencement of the partnership, stating that it is effective from the date of the deed and continues until terminated according to its terms. It also outlines the business of the partnership, which should be conducted in the best interests of the partnership on sound commercial profit-making principles. The name of the partnership is specified as well.
The partnership capital section explains that each partner is required to make initial contributions to the capital of the partnership. The specific amounts are listed for Party 1, Party 2, and Party 3. The partners' capital accounts are credited with the respective sums, and their percentage shares are determined based on their capital accounts.
Further finance may be required during the term of the partnership, and each partner undertakes to contribute their percentage share of the funding required. The terms for additional funding are agreed upon by the partners.
The profits and losses of the partnership are allocated to the partners in proportion to their percentage shares, unless otherwise agreed. Any surplus cash available to the partnership can be distributed to the partners according to their percentage shares.
The partnership board is responsible for the overall supervision of the business. It is composed of directors appointed by each partner. The chairperson and chief executive are also specified. The partnership board meets regularly, and resolutions are passed by a simple majority, except for certain reserved matters that require unanimity.
The executive management section delegates responsibility for day-to-day executive management to the chief executive, who is assisted by other executive managers. The appointment and terms of reference of the executive managers are subject to the approval of the partnership board.
The partnership property section states that the property and assets of the partnership are beneficially owned by the partners in proportion to their percentage shares. Any property held by a partner on behalf of the partnership is held on trust for the partnership.
Undertakings by partners include a non-compete clause, which prohibits partners from engaging in any competing business during the term of the partnership. Each partner also undertakes to promote the best interests of the partnership and act in good faith towards the other partners.
Expenses incurred by partners in the performance of their obligations can be reimbursed by the partnership, subject to arrangements approved by the partnership board.
The accounts section specifies that the partnership board is responsible for maintaining proper accounting records and arranging the preparation of audited accounts for each accounting period. The chief executive is responsible for producing a draft budget and updating the business plan.
Indemnities are provided by each partner to indemnify the other partner against any losses or liabilities arising from a breach of obligations or actions outside the scope of authority.
The document includes provisions for default, assignments, confidentiality, termination, waivers and amendments, notices, governing law, dispute resolution, counterparts, and states that no rights are granted to third parties.
In witness whereof, the document is executed, signed, sealed, and delivered as a deed on the date shown on the first page.
To use this Partnership Deed, follow these steps:
1. Review the document to ensure it meets your requirements and accurately reflects the intended partnership.
2. Enter the names and addresses of the parties involved in the partnership, as well as the name of the partnership itself.
3. Familiarize yourself with the definitions provided in the interpretation section to understand the terms used throughout the deed.
4. Determine the initial contributions to the partnership capital for each partner and ensure they are accurately reflected in the document.
5. Consider whether further finance may be required during the partnership and agree on the terms for additional funding.
6. Understand how profits and losses will be allocated among the partners based on their percentage shares.
7. Appoint directors to the partnership board, ensuring representation from each partner, and designate a chairperson and chief executive.
8. Delegate day-to-day executive management responsibilities to the chief executive and define the roles of other executive managers.
9. Clarify the ownership of partnership property and ensure any property held by a partner is held on trust for the partnership.
10. Review and understand the undertakings by partners, including the non-compete clause and obligations to promote the best interests of the partnership.
11. Establish procedures for reimbursement of expenses incurred by partners in the performance of their obligations.
12. Ensure proper accounting records are maintained and that audited accounts are prepared for each accounting period.
13. Consider any indemnities required to protect partners from losses or liabilities arising from breaches or unauthorized actions.
14. Familiarize yourself with the provisions for default, assignments, confidentiality, termination, waivers and amendments, notices, governing law, dispute resolution, and counterparts.
15. Execute the document by signing, sealing, and delivering it as a deed, ensuring all parties involved do the same.
Note: This guidance is provided for informational purposes only and does not constitute legal advice. It is recommended to consult with a legal professional to ensure compliance with applicable laws and regulations.