USA Partnership Agreement with Income to Continue After Death

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USA Partnership Agreement with Income to Continue After Death Powered By Docstoc
					                    GENERAL PARTNERSHIP AGREEMENT

THIS AGREEMENT made effective as of the _____ day of ______________, _______.


                                         [NAME OF PARTNER 1]

                                                  - and -

                                        [NAME OF PARTNER 2]
         (individually hereafter referred to as a “Partner”, and collectively as the “Partners”)

1.      Partnership Name

The name of the Partnership is: ______________.

2.      Partnership Purpose

The Partnership is formed for engaging in the business of :___________________.

3.      Duration of Partnership

The Partnership shall commence on the date of this Agreement and will continue until terminated as
hereinafter provided.

4.      Place of Business

The Partnership's principal place of business shall be at_____________________(insert address). All
Partnership books and records shall be kept at the above address. The principal place of business may
change if both parties provide written consent.

5.      Capital Contributions

Whenever required in the business of the partnership, capital shall be contributed by the partners in the
proportions in which they share in Partnership profits and losses. This paragraph shall not apply to the
estate of a deceased partner. Each Partner’s capital account shall be determined and maintained
throughout the term of the Partnership in accordance with the requirements of Section 704(B) of the
Internal Revenue Code of 1986, or its counterpart in any subsequently enacted Internal Revenue Code
(the Code), and any of the Treasury Regulations (the Regulations) promulgated from time to time
thereunder. No interest shall be paid to Partners on any contributions to capital.

6.      Division of Profits and Losses

The net profits and losses of the Partnership shall be divided and borne in the following proportions,
except that all losses resulting from the wrongful act or gross negligence of any Partner shall be charged
to him in full:

        [set out the divisions of profits / losses among the partners

The Senior Partners shall have the right to adjust the bases of participation by Junior Partners in profits
and losses without the consent of the Junior Partners. The senior and Junior Partners are designated in
paragraph 8.

7.      Salaries and Drawings

Any Partner, except the estate of a deceased Partner, shall have the right to draw against anticipated
earnings, in monthly installments, an amount not in excess of ____ percent (**%) of his earnings for the
preceding year, but in no event shall a Partner’s withdrawals exceed his proportionate share of
Partnership profits. Any amounts so withdrawn shall be charged against that Partner’s distributive share
of the profits of the Partnership business. Any Partner shall have the right, at the end of any calendar
year, to withdraw the balance of his share of the Partnership profits for that year. The drawings of
Partners during the first year of the Partnership shall be agreed upon among all the Partners.

8.      Partnership Management

The Partnership shall be composed of the following persons:

Name                               Address                                   Senior / Junior Partner Status

The Senior Partners shall have the right to admit additional Partners upon such terms as they may
determine, but the participation percentage in net earnings of the estate of a deceased Partner shall not be
altered nor the period of participation curtailed. All of the Partners shall participate in the conduct of
Partnership affairs and each Partner shall devote his entire time thereto. In matters relating to the routine
management of the Partnership business, a decision by the majority of the Senior Partners shall be
binding upon the Partnership, but on questions of firm policy the decision of a majority of the Senior
Partners shall prevail. The estate of a deceased Partner shall continue as a member of the Partnership as
hereinafter provided, but such estate shall have no voice in the management of the Partnership business.

9.      Banking

All funds of the Partnership shall be deposited into such checking account or accounts opened in the
name of the Partnership as shall be designated by the Partners. All withdrawals therefrom are to be made
upon checks signed by any ____ Senior Partner(s).

10.     Books

The Partnership books shall be maintained at the principal office of the Partnership, and any Partner shall
at all times have access thereto. The books shall be kept on a cash basis, and shall be closed, balanced, and
audited at the end of each calendar year.

11.     Withdrawal or Liquidation

Upon withdrawal of any Partner or upon the voluntary liquidation of the Partnership, the following
procedure will be observed:

(a)     Withdrawal. Any Partner shall have the right to withdraw from the Partnership at the end of any
        calendar year. Written notice of intention to withdraw shall be served upon the other Partners at
        the office of the Partnership at least three months before the end of the calendar year. The
        withdrawal of any Partner shall have no effect upon the continuance of the Partnership business.
        The Partnership books shall be closed at the end of the calendar year in the regular way and the
        withdrawing Partner shall be paid the following amounts: (i) the undrawn portion of the
        withdrawing Partners share of the Partnerships profits, if any, as of the end of the year, (ii) the
        amount of his capital account as of the end of the year, (iii) the withdrawing Partner’s
        proportionate share of any fees received by the continuing Partnership subsequent to the end of
        the year for accounts receivable or work in process as of the end of the year. In determining the
        part of the total fee in which the withdrawing Partner shall share, account shall be taken of the
        relative importance and value of the work done prior to the end of the year compared with the
        work done subsequent thereto. The remaining Partners shall have the right to deduct from the
        amount payable to the withdrawing Partner his proportionate share of any debts and/or
        reasonable reserve for liabilities not reflected on the books of the Partnership as of the end of the
        year. The remaining Partners, together with any new Partners, shall have the right to continue the
        business under the same firm name.

(b)     Liquidation. Should the Partners having ____ percent (**%) or more of the interests in the profits
        and losses of the Partnership agree to terminate the Partnership business, the Partners shall share
        in any profits and losses of the business during the period of liquidation in the same proportions
        in which they shared the profits and losses prior to the termination of the Partnership business.

The proceeds of such liquidation shall be applied in the following order of priority: (i) to the payment of
any debts and liabilities of the Partnership; (ii) to the setting up of any reserve which the Partners shall
reasonably deem necessary to provide for any contingent or unforeseen liabilities or obligations of the
Partnership. At the expiration of such period of time as the Partners shall deem advisable, the balance of
such reserve remaining after the payment of such contingency shall be distributed in the manner
hereinafter set forth; (iii) thereafter, the balance of the proceeds, if any, shall be distributed in accordance
with the positive capital account balances of the Partners, as determined after taking into account all
capital account adjustments for the Partnership taxable year during which such liquidation occurs, and
shall be made by the end of such taxable year (or, if later, within ninety (90) days after the date of such
liquidation). For purposes of this subparagraph, a liquidation of the Partnership shall mean a liquidation
as set forth in Section 1.704-1(B)(2)(II)(G) of the Regulations.

If, following the liquidation of a Partner’s interest in the Partnership (within the meaning of Treasury
Regulations Section 
Description: Prepare a Partnership Agreement with Income to Continue After Death with this easy template for the USA. - If a partner dies, the partnership continues as a partnership among the surviving partners and the estate of the deceased partner. - The decedent's estate continues to participate in the net earnings and losses of the partnership for a period of years and in a proportion stipulated in the Agreement. Profits will be paid to the estate in quarterly installments. - The capital account of the decedent will be determined at the time of death and will be paid to the estate in equal quarterly installments, together with interest. - A partner may retire from the partnership at the end of a calendar year, and the same provisions will apply to a retired partner as to a deceased partner. - The surviving partners have the right to continue using the name of a deceased or retired partner in the partnership name. This USA Partnership Agreement with Income to Continue After Death template is provided in MS Word format, and is fully editable to fit your particular circumstances.
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