Limited Partnership Agreement

Neutral - 5 Parties

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Description:

Five Parties Limited Partnership Agreement (a general partnership) will be established under local law. It provides a basic Limited Partnership framework only. This agreement is drafted in Neutral Form.

LP1, LP2, LP3 and LP4 (each a "Limited Partner", together the "Limited Partners”) wish to establish a partnership with the General Partner (each a “Partner”, together the “Partners”) in [Territory] under the name of [name] (the Partnership) for the purpose of [business].

The Partners wish to regulate their relationship as partners in the Partnership and the management of the Partnership in accordance with the terms of this Agreement.

The Business shall be conducted in the best interests of the Partnership on sound commercial profit-making principles in accordance with the Business Plan. The Partners shall use all reasonable endeavours to procure its prompt and effective implementation.

The Partners shall respectively make initial contributions to the capital of the Partnership as follows:

(a) General Partner: [describe or refer to a commitment to providing initial contribution: cash, assets, transfer of property etc.]

(b) LP1: [describe or refer to a commitment to providing initial contribution: cash, assets, transfer of property etc.]

(c) LP2: [describe or refer to a commitment to providing initial contribution: cash, assets, transfer of property etc.]

The Partners acknowledge and agree that, following the initial contributions.

The Percentage Shares of the Partners shall accordingly be X per cent for General Partner, Y per cent for LP1 and Z per cent for LP2 (or such other percentages as may from time to time be a consequence of any sale, assignment, transfer or disposal of the whole or part of a Partner's Partnership Interest pursuant to or as permitted by this Agreement).

Each Partner undertakes that it will during the term of this Agreement contribute its Percentage Share of all funding required by any relevant Budget or as agreed by the General Partner.

All capital contributed by General Partner, LP1 and LP2 to meet funding shall (unless otherwise agreed by the Partners) be treated as a capital contribution and credited to its respective Capital Account.

The amount of profit and loss in respect of any Accounting Period shall be determined from the Accounts of the Partnership. All profits and losses of the Partnership for any Accounting Period shall be allocated to the Partners in proportion to their Percentage Shares unless the Partners agree otherwise.

All profits and losses allocated under clause 6.1 shall be respectively credited or debited to the Partners' current accounts.

Any cash available to the Partnership which the General Partner determines is surplus to the requirements of the Partnership shall, at the request of any Partner, be distributed to General Partner, LP1 and LP2 in accordance with their respective Percentage Shares.

Overall supervision of the Business is the responsibility of the General Partner. The General Partner has authority to act on behalf of the Partnership in all matters in connection with the Business and will carry out its duties in such manner as the General Partner considers to be in the best interests of the Partnership.

Subject to any other provision of this Agreement, a person may be admitted as a General Partner after the registration with the Companies House is filed only with the written consent of each General Partner and the vote or written consent of fifty-one per cent (51%) of all Partners.

Subject to the provisions governing transfers of Partnership interests, a person may acquire an interest in the Partnership directly from the Partnership and be admitted as an Additional Limited Partner only with the approval of the General Partner and fifty-one per cent (51%) of all Partners. Each Partner's interest will be proportionally reduced to admit the new Limited Partner.

The Limited Partners shall not participate in the management or operation of the business of the Partnership. The General Partner may not be removed by the Limited Partners.

The Partnership shall pay reasonable fees to the General Partner for services rendered to the Partnership, as determined by the Partners.

Other than his share of profits and losses, the General Partner shall not be entitled to any additional compensation for services rendered as General Partner.

Except as otherwise set forth in this Agreement, the General Partner shall have sole and exclusive control of the Limited Partnership. The General Partner shall have the power and authority to take such action from time to time as he may deem to be necessary, appropriate, or convenient in connection with the management and conduct of the business and affairs of the Partnership, including without limitation the power to:

Acquire property, including real or personal property, for the use of the Partnership upon such terms and conditions as the General Partner, may, from time to time, determine to be advantageous to the Partnership;

Finance the Partnership's activities by borrowing money from third parties on such terms and under such conditions as the General Partner deems appropriate. When money is borrowed for Partnership purposes, the General Partner shall be, and hereby is, authorized to pledge, mortgage, encumber, or grant a security interest in Partnership properties as security for the repayment of such loans.

Employ, retain, or otherwise secure the services of such personnel or firms deemed necessary by the General Partner for or to facilitate the conduct of Partnership business affairs, all on such terms and for such consideration as the General Partner deems advisable; and

Take any and all other actions which is permitted by law and which is customary in or reasonably necessary related to the conduct of the Partnership business or affairs.

In the case where there is more than one General Partner, the General Partners shall meet quarterly. In addition, any General Partners has the right to convene a meeting of the General Partners at any time. Any meeting of the General Partners shall be called by the Chairperson and conducted in accordance with the provisions.

The quorum for any meeting of the General Partner (other than an adjourned meeting) is at least one representative from each General Partner. If that quorum is not present within 30 minutes from the time appointed for the meeting or if during the meeting the quorum ceases to be present, the meeting shall be adjourned for seven (7) Business Days.

At least seven (7) Business Days' written notice shall be given of any meeting of the General Partners, provided that a shorter period of notice may be given with the written approval of all General Partners. Any such notice shall include an agenda identifying in reasonable detail the matters to be discussed (in particular, of any matter, set out in clause 7.13) and shall be accompanied by copies of any relevant papers to be discussed at the meeting and any resolutions to be tabled. A meeting of the General Partner may consist of a conference between General Partners who are not all in one place, but of whom each is able (directly or by telephonic communication) to speak to each of the others and to be heard by each of the others simultaneously; and the word meeting in this Agreement shall be construed accordingly.

Any General Partner can require the Chief Executive or any other Executive Manager to attend (but not vote at) all or part of any meeting of the General Partner in order to provide information or views. The General Partner must notify the relevant Executive Manager and the Chairperson and the other General Partners within five Business Days of receiving the notice of meeting that the Executive Manager's attendance is required and specify the items on which his information or views will be required.

Resolutions of the General Partner shall be passed as follows:

(a) Each General Partner has one vote. Any General Partner who is absent from the meeting may nominate any other General Partner who is present to act as his alternate and to vote in his place at the meeting.

(b) The General Partners present (if constituting a quorum) shall nominate a chairperson for that meeting; any General Partner acting as such a chairperson shall continue to have his vote.

(c) Resolutions of the General Partners are passed by a simple majority.

(d) Should the number of votes be identical under (c), the resolutions shall be passed by a majority of the shares (51%) of the General Partners.

In the event of deadlock on any vote taken which cannot be resolved after a further meeting of the General Partners, the matter shall be referred to the Chief Executives or other senior representatives of the Partners whose determination (if unanimous) shall bind the General Partners.

The following Reserved Matters shall, in any event, require unanimity of the General Partners:

(a) any change in the nature or scope of the Business (including any material business acquisition or disposal exceeding [amount] in value or any material partnership or joint venture);

(b) any material change in the organisation of the Partnership;

(c) appointing or removing the Chief Executive or any material change in their respective employment terms;

(d) approving the Business Plan and Budget or any material deviation from the Business Plan or Budget;

(e) any expenditure on any particular item which is more than [amount] (except as provided for in the relevant Budget);

(f) disposing of (including the grant of any security interest or other encumbrance over) any Partnership property where the value of the property exceeds [amount];

(g) any transaction with a Partner or its Affiliate (or any material amendment to any contract with a Partner or its Affiliates);

(h) removing Auditors and appointing new Auditors;

(i) any change in the accounting policies of the Partnership;

(j) commencing, settling or ceasing any litigation or arbitration involving the Partnership other than any litigation or arbitration involving (i) a dispute pursuant to this Agreement or (ii) a claim of less than <? echo $LITIGATION; ?>;

(k) the borrowing or lending by the LLP or the giving of [amount];

(l) any guarantee or undertaking by the LLP of or in respect of any sum or connected sums being (in the aggregate where appropriate) in excess of [amount];

(m) any determination whether any cash available to the Partnership is surplus to the requirements of the Partnership.

Except as provided below, the Limited Partners shall not have either the obligation or the right to take part, directly or indirectly, in the active management or control of the business of the Partnership. The following Partnership actions may only be taken after approval by vote of the Partners:

(a) veto of a call for additional capital;

(b) admission of an additional General Partner;

(c) admission of an additional Limited Partner;

(d) admission of a Successor General Partner;

(e) amendment of the Partnership Agreement as provided in

(f) the sale or transfer of the Business;

(g) any loan by a Partner to the Partnership;

(h) consent to dissolution;

(i) remuneration of the General Partner; and

(i) election of a new general partner.

The quorum for any meeting of the Partners (other than an adjourned meeting) is Partners holding more than 50% of the voting power shall be present in person or by proxy with at least one representative from each General Partner. If that quorum is not present within 30 minutes from the time appointed for the meeting or if during the meeting the quorum ceases to be present, the meeting shall be adjourned for seven (7) Business Days.

The General Partner shall devote such care, attention, and business capacity to the affairs of the Partnership as may be reasonably necessary. In this connection, the Partners hereby acknowledge that any General Partner may be the Manager or General Partner of other partnerships and may continue to manage other partnerships, and may continue to engage in other related business, whether or not competitive with the business of the Partnership.

The General Partner shall exercise ordinary business judgment in managing the affairs of the Partnership. Unless fraud, deceit, or a wrongful taking is involved, the General Partner shall not be liable or obligated to the Limited Partners for any mistake of fact or judgment made by the General Partner in operating the business of the Partnership that results in any loss to the Partnership or its Partners. The General Partner does not, in any way, guarantee the return of the Limited Partners' capital or a profit from the operations of the Partnership. The General Partner shall not be responsible to any Limited Partner because of a loss of that Partner's investment or a loss in operations unless it has been occasioned by fraud, deceit, or a wrongful taking by the General Partner.

 

How to use this Document?

 

This Agreement should be carefully read by the undersigning individuals.

This Agreement should be signed by the authorised signatory and witnessed in the presence of a solicitor or a notary public to complete the formality.

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Document Type:

Agreements / contracts

Category:

Business > Setup of Business / Entity > Partnership / Limited Partnership / LLP Agreement

 
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