LLP Agreement Template

Use Template
Limited Liability Partnership Agreement

 

This Agreement of Limited Liability Partnership made at ______________________________  and on the date of______________________________ Between Party A______________________________ (the "First Party") of the following address: _______________________________ And Party B______________________________ (the "Second Party") of the following address: _______________________________. (Referred to herein as  a "Partner" and together the "Partners"). In consideration of the terms and conditions set out in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Partners hereby agree as follows:

 

  1. Nature of Partnership The Partners hereby form a limited liability partnership pursuant to the Limited Liability Partnership Act (the "LLP"), to be known as______________________________(the "Partnership"). The Partnership shall carry on business in the Province of______________________________and such other jurisdictions as the Partners may from time to time determine.

 

  1. Partnership Property

 

2.1 All property, assets, rights, privileges, interests, powers and immunities of whatsoever nature and wheresoever situate, and all debts, liabilities and obligations of whatsoever nature and wheresoever arising, belonging to or incurred by the Partnership from time to time shall be the property of and be incurred by the Partnership on behalf of the Partners jointly and severally, and the Partners agree to indemnify the Partnership and hold it harmless from any and all claims, losses, damages, liabilities, costs and expenses whatsoever arising out of or relating to any property, asset, right, privilege, interest, power or immunity of the Partnership or any debt, liability or obligation of the Partnership.

 

2.2 The Partnership shall keep full and accurate accounts of all sums of money received and expended by it and the matters in respect of which such receipt and expenditure takes place, and shall keep all other books and records relating to the Partnership as the Partners may from time to time determine.

 

  1. Partnership Profits and Losses

 

3.1 The Partnership shall be conducted on a non-profit basis and no Partner shall be entitled to receive any salary, fee, commission, bonus or other form of remuneration from the Partnership.

 

3.3 The Partners acknowledge that the Partnership is not a joint venture and that nothing in this Agreement shall be construed as creating a partnership or joint venture between the Parties for any purpose.

 

  1. Partnership Contributions

 

4.1 The Partnership shall be financed by the following initial contributions:

Party A______________________________ Party B______________________________

 

4.2 All future contributions to the Partnership shall be made on such terms and conditions as the Partners may from time to time determine.

 

  1. Partnership Expenses The Partnership shall pay or reimburse all expenses properly incurred by any Partner on behalf of the Partnership.

 

  1. Partnership Books and Records

 

6.1 The Partnership shall keep full and accurate accounts of all sums of money received and expended by it and the matters in respect of which such receipt and expenditure takes place, and shall keep all other books and records relating to the Partnership as the Partners may from time to time determine.

 

6.2 The books and records of the Partnership shall be open to inspection by any Partner at all reasonable times.

 

6.3 The books and records shall be kept in accordance with generally accepted accounting principle (GAAP).

 

6.4 The Partnership's fiscal year will begin on [date] and close on [date]. An income statement and balance sheet will be prepared at the end of each fiscal year within ___________ months at the end of the fiscal year. An audit of the books and records of the Partnership as of the end of each fiscal year will be prepared by a firm of independent certified public accountants selected by the Partnership.

 

  1. Management

 

Each Partner has equal rights in the management of the Partnership. The Partners will devote as much of his or her time and efforts to the affairs of the Partnership as may be necessary to accomplish the objectives of the Partnership.

 

  1. Voluntary Dissolution of Partnership

 

The Partnership may be dissolved at any time upon the consent of The Partners shall, as soon as reasonably practicable, liquidate and wind up the affairs of the Partnership. The proceeds received in connection with the liquidation and any other remaining assets of the Partnership will be applied in the following order of priority:

  1. payment of all debts, liabilities and obligations of the Partnership including all expenses of liquidation;
  2. distribution to or for the benefit of the Partners in accordance with the positive balance in each Partner's income accounts;
  3. distribution to or for the benefit of the Partners in accordance with the positive balance in each Partner's capital accounts.

 

  1. Partner's Withdrawal

 

A Partner's withdrawal from the Partnership will terminate the Partnership. The Partnership will be dissolved and the assets liquidated in accordance with paragraph no. 8.

 

  1. Partner's Retirement

 

A Partner may retire from the Partnership by providing at least ___________ day(s) written notice of such intention to retire to the other Partners. The remaining Partners may decide either to dissolve and liquidate the Partnership with the retiring Partner (in accordance with paragraph no. 8) or continue the Partnership by purchasing the retiring Partner's interest (in accordance with paragraph no. 16). The decision to dissolve or continue the Partnership requires the unanimous consent of the remaining Partners. If the remaining Partners choose to purchase the retiring Partner's interest, the remaining Partners shall provide written notice of such intention within ____________ day(s) after receipt of the retiring Partner’s notice to retire. 

 

  1. Buyout

 

If the remaining Partners choose to purchase the withdrawing, retiring or deceased Partner's interest under the preceding paragraphs, that interest will be purchased in the amounts as decided by the remaining Partners that wish to purchase. The purchase price will be equal to the amount in the withdrawing, retiring or deceased Partner's capital account as of the date of his or her withdrawal, retirement or death, plus or minus the amount in the withdrawing, retiring or deceased Partner's income account at the end of the month immediately preceding the withdrawal, retirement or death, and adjusted for the withdrawing, retiring, or deceased Partner's share of the Partnership profits or losses, not previously credited or charged, through the end of the month in which the withdrawal, retirement or death occurred. The purchase price will not include any separate amounts for goodwill, trade name, patents, or other intangible assets. The remaining Partners may continue to use the Partnership trade name. The purchase price will be paid with interest, at the rate of per annum within months after the date of the withdrawal, retirement or death.

 

  1. Restriction on Transfer

 

No Partner shall transfer, assign, sell, give, pledge, hypothecate or otherwise encumber, or dispose of in any manner any or all of his or her interest in the Partnership without the written consent of all Partners.

 

  1. New Partners

 

The Partnership, upon the ______________ of all Partners, may admit new Partners to the Partnership on the terms and conditions as determined by the Partners at such time.

 

  1. Arbitration

 

Any dispute arising out of or related to this Agreement that the Partners are unable to resolve by themselves shall be settled by arbitration in the State of _____________ in accordance with the rules of the American Arbitration Association. The written decision of the arbitrator(s), as applicable, shall be final and binding on the Partners. Judgment on a monetary award or enforcement of injunctive or specific performance relief granted by the arbitrator(s) may be entered in any court having jurisdiction over the matter.

 

  1. Severability

 

If any provision of this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the remaining provisions shall not be affected and shall continue to be valid, legal and enforceable as though the invalid, illegal or unenforceable parts had not been included in this Agreement.

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.

 

PARTY A ______________________________

 

PARTY B ______________________________