Illinois partnership agreement template

Illinois Partnership Agreement

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

• [Partner 1 Name], residing at [Partner 1 Address], Contact Information: [Partner 1 Contact Information], Identification Details: [Partner 1 Identification Details] (hereinafter referred to as "Partner 1")
• [Partner 2 Name], residing at [Partner 2 Address], Contact Information: [Partner 2 Contact Information], Identification Details: [Partner 2 Identification Details] (hereinafter referred to as "Partner 2")
• [Partner 3 Name], residing at [Partner 3 Address], Contact Information: [Partner 3 Contact Information], Identification Details: [Partner 3 Identification Details] (hereinafter referred to as "Partner 3")

1. Formation and Name

The parties hereby form a general partnership under the laws of the State of Illinois.

• Option A: The name of the partnership shall be [Partnership Name]. If operating under a fictitious name, the assumed name is [Fictitious Business Name].
• Option B: The partnership shall operate under the names agreed upon by the partners, as amended from time to time.

2. Principal Place of Business

The principal place of business of the partnership shall be located at [Principal Office Address] in Illinois.

• Option A: The partnership may establish additional offices at such other locations as may be determined by the partners.
• Option B: No additional offices shall be established without the unanimous consent of all partners.

3. Term

The term of this partnership shall commence on [Commencement Date].

• Option A: The partnership shall continue for a fixed term of [Number] years, ending on [Termination Date].
• Option B: The partnership shall continue until terminated as provided in this Agreement or by law (at-will).
• Option C: The partnership shall continue for the duration of the project: [Project Description].
  • The partnership will dissolve upon completion of the project or mutual agreement.

4. Purpose

The purpose of this partnership is to engage in the following business:

• Option A: To engage in any lawful business or activity under Illinois law.
• Option B: To engage in the business of [Specific Business Description].
  • The partnership shall not engage in any other business without the consent of [Majority/Unanimous] of the partners.

5. Capital Contributions

The initial capital contributions of each partner shall be as follows:

• Partner 1: [Partner 1 Contribution Amount/Description]
• Partner 2: [Partner 2 Contribution Amount/Description]
• Partner 3: [Partner 3 Contribution Amount/Description]

• Option A: Additional capital contributions may be required from time to time as determined by the partners.
  • Each partner shall contribute in proportion to their ownership percentage.
• Option B: No additional capital contributions shall be required.
• Option C: Any call for additional capital must be approved by [Number or Percentage]% of the partners.

6. Profit and Loss Allocation

The net profits and losses of the partnership shall be allocated as follows:

• Option A: Equally among the partners.
• Option B: In proportion to each partner's capital contribution.
• Option C: [Partner 1 Percentage]% to Partner 1, [Partner 2 Percentage]% to Partner 2, and [Partner 3 Percentage]% to Partner 3.
  • These percentages can be changed only with the written consent of all partners.

7. Distributions

Distributions of cash or other assets of the partnership shall be made to the partners at such times and in such amounts as the partners may determine.

• Option A: Distributions shall be made in proportion to each partner's profit sharing percentage.
• Option B: Distributions shall be made at least [Frequency], subject to the availability of funds.
• Option C: Distributions shall be made according to individual capital balances.

8. Management

The management of the partnership shall be vested in all partners.

• Option A: Each partner shall have equal rights in the management and conduct of the partnership business.
• Option B: [Managing Partner Name] shall be the managing partner and shall have the primary responsibility for the day-to-day operations of the partnership.
• Option C: A management committee consisting of [Number] partners shall be responsible for managing the partnership.

9. Partner Roles and Responsibilities

Each partner will be responsible for the following:

• Partner 1: [Partner 1 Responsibilities]
• Partner 2: [Partner 2 Responsibilities]
• Partner 3: [Partner 3 Responsibilities]

• Option A: All partners shall devote their full time and attention to the business of the partnership.
• Option B: Partners can engage in outside activities as long as they do not conflict with partnership duties.

10. Banking Authority

The following partners are authorized to open and maintain bank accounts on behalf of the partnership:

• [Authorized Partner 1 Name]
• [Authorized Partner 2 Name]

• Option A: Any partner may borrow money on behalf of the partnership, with the consent of [Majority/Unanimous] of the partners.
• Option B: Only [Specific Partner Name] is authorized to borrow money on behalf of the partnership.

11. Admission of New Partners

New partners may be admitted to the partnership only upon the unanimous consent of all existing partners.

• Option A: The terms and conditions of admission shall be determined by the existing partners.
• Option B: A new partner must contribute capital equal to [Dollar Amount] or [Percentage] of the existing capital.

12. Withdrawal or Expulsion of Partners

A partner may withdraw from the partnership upon [Number] days' written notice to the other partners.

• Option A: A partner may be expelled from the partnership for [Reasons for Expulsion] by a vote of [Percentage]% of the remaining partners.
• Option B: Upon withdrawal or expulsion, the departing partner shall be entitled to receive [Buyout Terms] for their partnership interest.

13. Transfer of Partnership Interests

No partner may transfer or assign their partnership interest without the prior written consent of the other partners.

• Option A: The other partners shall have a right of first refusal to purchase the transferring partner's interest.
• Option B: The transfer must be to an approved transferee.

14. Non-Competition and Confidentiality

Each partner agrees not to compete with the partnership during the term of this agreement and for a period of [Number] years following the termination of their partnership.

• Option A: This non-competition agreement applies only within [Geographic Area].
• Option B: All partners must maintain the confidentiality of all partnership information. This obligation survives the termination of this agreement.

15. Compensation

Partners shall be compensated as follows:

• Option A: Partners shall not receive any compensation other than their share of profits.
• Option B: [Partner Name] shall receive a guaranteed payment of [Dollar Amount] per [Time Period].
• Option C: Partners are reimbursed for partnership expenses incurred, subject to documentation and approval.

16. Accounting and Fiscal Year

The partnership's fiscal year shall end on [Date].

• Option A: The partnership shall maintain its books and records in accordance with generally accepted accounting principles (GAAP).
• Option B: The partnership shall elect to be taxed as a [Partnership/Corporation] for federal and Illinois income tax purposes.

17. Default and Remedies

A partner shall be in default of this agreement upon the occurrence of any of the following events: [List of Default Events].

• Option A: The non-defaulting partners may pursue any remedies available at law or in equity.
• Option B: The defaulting partner shall be required to forfeit a portion of their capital account.

18. Indemnification

The partnership shall indemnify each partner against any loss, damage, or liability incurred by reason of their participation in the partnership, except for acts of gross negligence or willful misconduct.

19. Dissolution

The partnership may be dissolved upon the agreement of [Percentage]% of the partners.

• Option A: The partnership shall be dissolved automatically upon the death, bankruptcy, or adjudicated incompetence of any partner.
• Option B: Upon dissolution, the assets of the partnership shall be liquidated and distributed in accordance with Illinois law.

20. Dispute Resolution

Any dispute arising out of or relating to this agreement shall be resolved through [Mediation/Arbitration/Litigation] in [Cook County or other Illinois County], Illinois.

• Option A: The laws of the State of Illinois shall govern the interpretation and enforcement of this agreement.
• Option B: All disputes shall be resolved through binding arbitration in accordance with the rules of the American Arbitration Association.

21. Amendment

This agreement may be amended only by a written instrument signed by all of the partners.

• Option A: Amendments require [Percentage]% agreement.
• Option B: Certain sections, such as capital contributions or profit/loss allocation, require unanimous approval for amendment.

22. Intellectual Property

All intellectual property created by the partners in connection with the partnership shall be owned by the partnership.

• Option A: The partnership shall have the right to use and exploit such intellectual property.
• Option B: Partners retain rights to their individually developed intellectual property brought into the partnership before the agreement.

23. Miscellaneous

This agreement constitutes the entire agreement between the parties and supersedes all prior agreements and understandings.

• Option A: This agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, successors, and assigns.
• Option B: Notices shall be deemed to have been duly given when delivered in person or mailed by certified mail, return receipt requested, to the address of the party set forth in this agreement.

24. Illinois Specific Provisions

This agreement is intended to comply with the Illinois Uniform Partnership Act (1997).

• Option A: The partners acknowledge their fiduciary duties to each other, including the duties of loyalty and care, as defined under Illinois law.
  • To the extent permitted by Illinois law, the partners agree to modify the duties of loyalty and care as follows: [Specific Modifications].
• Option B: The partners authorize the filing of a statement of partnership authority with the Illinois Secretary of State.
• Option C: The partners acknowledge their responsibilities under Illinois income and replacement tax rules.

25. Partner Death, Disability, or Divorce

In the event of the death or disability of a partner, the partnership shall [Continue/Terminate].

• Option A: The deceased or disabled partner's interest shall be purchased by the partnership pursuant to a buy-sell agreement.
• Option B: Spousal consent/waiver is attached to this agreement to confirm the spouse acknowledges the terms related to partnership interest transfer in case of divorce or death.

26. Compliance Statements

The partnership will comply with all applicable Illinois and local business registration and permit requirements.

27. Electronic Signature

This agreement may be executed in counterparts, including electronically, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.

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

____________________________

[Partner 1 Name]

____________________________

[Partner 2 Name]

____________________________

[Partner 3 Name]