Colorado partnership agreement template

Colorado Partnership Agreement

This Partnership Agreement (the “Agreement”) is made and entered into as of this [Date], by and among the following partners:

• [Partner Name 1], residing at [Address] (“Partner 1”);
• [Partner Name 2], residing at [Address] (“Partner 2”);
• [Partner Name 3], residing at [Address] (“Partner 3”); (and so on)

1. Formation and Type of Partnership

• The Partners hereby form a partnership under the laws of the State of Colorado, subject to the provisions of the Colorado Uniform Partnership Act (CUPA).
• The name of the Partnership shall be [Partnership Name].
• The principal place of business of the Partnership shall be located at [Address].
• The Partnership's registered agent in Colorado is [Registered Agent Name], located at [Registered Agent Address].
• Type of Partnership:
  • Option A: General Partnership
  • Option B: Limited Partnership (LP)
  • Option C: Limited Liability Partnership (LLP)
  • Option D: Limited Liability Limited Partnership (LLLP)

2. Business Purpose and Scope

• The purpose of the Partnership is to engage in the business of [Description of Business]. The Partnership's activities shall be limited to those reasonably necessary or convenient to accomplish this purpose.

3. Term of Partnership

• The term of this Partnership shall commence on the date first written above and shall continue:
  • Option A: For a definite term of [Number] years, expiring on [Date].
  • Option B: Until terminated as hereinafter provided.
• Extension or Dissolution:
  • Option A: Extension requires unanimous written consent of all Partners [Number] days prior to the expiration date.
  • Option B: The Partnership shall dissolve upon the occurrence of any of the following events: [List Events].

4. Capital Contributions

• Each Partner shall contribute to the capital of the Partnership the following:
  • [Partner Name 1]: [Description of Contribution, e.g., $ Amount, Property Description]
  • [Partner Name 2]: [Description of Contribution, e.g., $ Amount, Property Description]
  • [Partner Name 3]: [Description of Contribution, e.g., $ Amount, Property Description]
• Method and Timing:
  • Option A: Contributions shall be made in cash within [Number] days of the effective date of this Agreement.
  • Option B: Contributions of property shall be transferred to the Partnership within [Number] days of the effective date of this Agreement.
• Ownership Percentages:
  • [Partner Name 1]: [Percentage]%
  • [Partner Name 2]: [Percentage]%
  • [Partner Name 3]: [Percentage]%
• Additional Contributions:
  • Option A: Additional capital contributions may be required by a [Percentage]% vote of the Partners.
  • Option B: No Partner shall be required to make additional capital contributions.
• Capital Accounts: A capital account shall be maintained for each Partner in accordance with IRS regulations.
• Valuation and Withdrawal:
  • Option A: Withdrawal of capital is permitted only with unanimous written consent of the Partners.
  • Option B: No withdrawal of capital is permitted during the term of the Partnership.

5. Allocation of Profits, Losses, and Distributions

• Profits and losses of the Partnership shall be allocated among the Partners in proportion to their respective ownership percentages as set forth in Section 4.
• Distributions:
  • Option A: Distributions shall be made to the Partners at least [Frequency, e.g., quarterly, annually] in proportion to their ownership percentages.
  • Option B: Distributions shall be made at the discretion of the Managing Partner(s), subject to the approval of [Percentage]% of the Partners.
• Tax Allocations: Tax allocations shall be made in accordance with Section 704(b) of the Internal Revenue Code.

6. Management and Decision-Making

• Option A: All Partners shall participate in the management of the Partnership. Decisions shall be made by a [Percentage]% vote of the Partners.
• Option B: Managing Partner(s): [Partner Name(s)] shall serve as the Managing Partner(s) and shall have the authority to make day-to-day decisions on behalf of the Partnership.
• Voting Rights:
  • Option A: Voting shall be per capita (one vote per Partner).
  • Option B: Voting shall be in proportion to each Partner's ownership percentage.
• Decisions Requiring Unanimous Consent: The following decisions shall require the unanimous consent of all Partners: [List of Decisions].

7. Roles, Duties, and Obligations of Partners

• Each Partner shall devote such time and attention to the business of the Partnership as may be reasonably necessary.
• Restrictions on Competition:
  • Option A: No Partner shall engage in any business that competes with the business of the Partnership during the term of the Partnership.
  • Option B: Partners are not restricted from engaging in other business activities.
• Fiduciary Duties: Each Partner shall owe a fiduciary duty of loyalty, care, and disclosure to the Partnership and the other Partners.
• Employment or Service Expectations: [Describe any specific employment or service expectations for each partner].

8. Admission of New Partners

• New Partners may be admitted to the Partnership only with the unanimous written consent of the existing Partners.
• Criteria for Admission: [Specify criteria for admission, e.g., capital contribution, experience].
• Approval Process: [Outline the approval process for admitting new partners].
• Effect on Ownership Percentages: The admission of a new Partner shall result in a dilution of the existing Partners' ownership percentages, as agreed upon by all Partners.

9. Transfer of Partnership Interests

• No Partner may sell, assign, or otherwise transfer their Partnership interest without the prior written consent of [Percentage]% of the other Partners.
• Right of First Refusal:
  • Option A: The remaining Partners shall have a right of first refusal to purchase the transferring Partner's interest.
  • Option B: No right of first refusal.
• Buy-Sell Provisions: In the event of a proposed transfer, the following buy-sell provisions shall apply: [Describe Buy-Sell Provisions].

10. Partner Withdrawal, Retirement, Expulsion, or Removal

• Withdrawal: A Partner may withdraw from the Partnership upon [Number] days written notice to the other Partners.
• Retirement: A Partner may retire from the Partnership upon [Number] days written notice to the other Partners.
• Expulsion or Removal: A Partner may be expelled or removed from the Partnership for cause, as determined by a [Percentage]% vote of the other Partners. “Cause” shall include [Define Cause].
• Settlement of Departing Partner's Interests: Upon withdrawal, retirement, expulsion, or removal, the departing Partner shall be entitled to receive the fair market value of their Partnership interest, as determined by [Valuation Method, e.g., independent appraisal, formula].
• Non-Compete/Non-Solicitation:
  • Option A: Upon withdrawal, retirement, expulsion, or removal, a Partner shall not compete with the Partnership or solicit its clients or employees for a period of [Number] years within [Geographic Area]. This is intended to comply with Colorado law regarding such agreements.
  • Option B: No non-compete or non-solicitation provisions shall apply.

11. Dissolution and Winding Up

• The Partnership shall dissolve upon the occurrence of any of the following events: [List of Dissolution Events].
• Winding Up: Upon dissolution, the Partners shall wind up the affairs of the Partnership, liquidate its assets, and distribute the proceeds in the following order: (i) to creditors; (ii) to Partners in repayment of loans; (iii) to Partners in repayment of capital contributions; and (iv) to Partners in proportion to their ownership percentages.

12. Partner Liability and Indemnification

• Liability:
  • Option A: The liability of the Partners shall be joint and several.
  • Option B: (For LLP or LLLP only) The liability of the Partners shall be limited as provided under the Colorado Uniform Partnership Act.
• Indemnification: The Partnership shall indemnify and hold harmless each Partner from and against any and all losses, claims, damages, liabilities, and expenses arising out of the Partner's conduct on behalf of the Partnership, except in cases of gross negligence or willful misconduct.

13. Dispute Resolution

• Any dispute arising out of or relating to this Agreement shall be resolved as follows:
  • Internal Dispute Procedure: The Partners shall first attempt to resolve the dispute through good faith negotiations.
  • Mediation/Arbitration:
    • Option A: If the dispute cannot be resolved through negotiation, the Partners shall submit the dispute to mediation in [City, Colorado].
    • Option B: If mediation fails, the Partners shall submit the dispute to binding arbitration in [City, Colorado], in accordance with the rules of the American Arbitration Association.
• Governing Law and Venue: This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado. The venue for any court proceeding shall be in [County, Colorado].

14. Tax Matters

• The Tax Matters Partner shall be [Partner Name].
• The Partnership shall file its tax returns on a [Method, e.g., calendar, fiscal] year basis.
• Each Partner shall be responsible for paying their individual income taxes on their share of the Partnership's profits.

15. Banking and Accounting

• The Partnership shall maintain its bank accounts at [Bank Name].
• The Partnership's books and records shall be maintained by [Accountant Name/Firm].
• The Partnership's fiscal year shall end on [Date].
• Audits:
  • Option A: The Partnership shall be audited annually by an independent certified public accountant.
  • Option B: No annual audit is required.

16. Insurance

• The Partnership shall maintain the following insurance coverage:
• General Liability Insurance: [Amount]
• Professional Liability Insurance (if applicable): [Amount]
• Key-Person Insurance (if applicable): For [Partner Name(s)], in the amount of [Amount].

17. Confidentiality, Trade Secrets, and Intellectual Property

• Confidential Information: Each Partner shall maintain the confidentiality of the Partnership's confidential information.
• Trade Secrets: Each partner is obligated to protect the partnership's trade secrets as defined under Colorado law.
• Intellectual Property:
  • Option A: All intellectual property created by the Partners in connection with the business of the Partnership shall be owned by the Partnership.
  • Option B: Intellectual property created by a Partner shall be owned by that Partner, unless otherwise agreed in writing.

18. Employment/Contractor Status

• Option A: Partners are not considered employees or contractors of the partnership
• Option B: If a partner is an employee or contractor, then: [Clearly specify terms and conditions, including compliance with relevant employment laws and worker’s compensation insurance if applicable]

19. Compliance with Laws

• The Partnership shall comply with all applicable federal, state, and local laws and regulations, including all licensing and permitting requirements relevant to the State of Colorado.

20. Amendment

• This Agreement may be amended only by a written instrument signed by [Percentage]% of the Partners.

21. Notice

• All notices under this Agreement shall be in writing and shall be deemed to have been duly given when delivered personally or sent by certified mail, return receipt requested, to the address of the Partner set forth in this Agreement.

22. Miscellaneous

• Severability: If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.
• Entire Agreement: This Agreement constitutes the entire agreement among the Partners with respect to the subject matter hereof and supersedes all prior or contemporaneous communications and proposals, whether oral or written.
• Counterparts: This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
• Waiver: No waiver of any provision of this Agreement shall be effective unless in writing and signed by the party against whom the waiver is sought to be enforced.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

____________________________
[Partner Name 1]

____________________________
[Partner Name 2]

____________________________
[Partner Name 3]
(Add more signatures as needed)

Appendices/Schedules (If Required)

• Schedule A: Initial Capital Contributions
• Schedule B: List of Assets
• Schedule C: Partner Contact Information