This partnership agreement can be used to draft for establishing a general partnership for five parties under the law of a specified jurisdiction. This agreement is drafted to impose looser / lighter obligations on the parties.
This agreement provides a basic partnership framework only.
No Partner shall transfer, assign, encumber or otherwise deal with any of its Partnership Interest otherwise than in accordance with this clause 16 without obtaining the prior written consent of the other Partner. Save for intra-group transfers permitted under clause 16.8, no Partner shall transfer, assign, encumber or otherwise deal with any of its Partnership Interest for an initial period of five (5) years from the date of this Agreement.
After the end of the initial period mentioned in clause 16.2, if a Partner wishes to transfer its Partnership Interest (the Seller's Interest) other than to an Affiliate it shall give as early an indication as practicable to the other Partner of that wish so that orderly arrangements for the continuation of the Business can, if possible, be agreed. If no such arrangements are agreed, the Seller shall give to the other Partners notice in writing (a Transfer Notice) of the proposed transfer together with details of any proposed third party purchaser. A Transfer Notice is irrevocable, except as provided in this clause 16.
The Continuing Partner is bound (subject to any necessary regulatory approvals) to buy the Seller's Interest on giving written notice to the Seller to exercise its rights under clause 16.4. In such event, completion of the sale and purchase of the Seller's Interest shall take place within 60 days after the giving of the notice or, if later, the obtaining of all necessary approvals of any competent regulatory authorities. If the Continuing Partner gives notice rejecting the offer under the Transfer Notice or fails to give any notice under clause 16.4, the Seller is entitled to transfer the Seller's Interest on a bona fide arm's length sale to a Third Party Purchaser at a price being not less than the purchase price specified in the Transfer Notice, provided that the transfer is completed within a period of 180 days after the date of the Transfer Notice.
Completion of any transfer of the Seller's Interest to a Third Party Purchaser is conditional on the Third Party Purchaser entering into an agreement with the Continuing Partner whereby it agrees to be bound (in terms reasonably satisfactory to the Continuing Partner) by provisions corresponding to provisions of this Agreement binding upon the Seller including (but without limitation) the undertakings given and restrictions accepted by the Seller under clause 10 and this clause 16.
A Partner shall be entitled at any time to transfer all (but not some only) of its Partnership Interest to an Affiliate provided that the condition set out in clause 16.7 applies equally to any such transfer.
This document should be carefully read by the Partners in the proposed partnership.
Partners who wish to establish the partnership should complete their personal and business information as much as they could.
Please provide the territory / jurisdiction where the partnership will be formed, the name of the partnership, and the purpose of business of the partnership in creating this agreement. The initial capital contribution from each partner and property and assets initially owned by the partnership should also be indicated.
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