New Jersey partnership agreement template

New Jersey Partnership Agreement

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

• [Partner 1 Full Legal Name], residing at [Partner 1 Address]
• [Partner 2 Full Legal Name], residing at [Partner 2 Address]
• [Partner 3 Full Legal Name], residing at [Partner 3 Address] (Add more partners as needed)

The parties listed above hereby agree to form a partnership subject to the terms and conditions as set forth in this Agreement.

Partnership Name: The name of the partnership shall be [Partnership Name].

Business Purpose: The purpose of the partnership is to engage in the business of [Description of Business Purpose].

Principal Place of Business: The principal place of business of the partnership shall be located at [Address of Principal Place of Business] in the State of New Jersey.

Duration:

• Option A: The partnership shall commence on [Start Date] and shall continue for a fixed term of [Number] years, expiring on [End Date].
• Option B: The partnership shall commence on [Start Date] and continue for an indefinite term until terminated as provided herein.

Type of Partnership:

• Option A: General Partnership. This is intended to be a general partnership, governed by the New Jersey Uniform Partnership Act, N.J.S.A. 42:1A-1 et seq.
• Option B: Limited Partnership. This is intended to be a limited partnership, governed by the New Jersey Revised Uniform Limited Partnership Act, N.J.S.A. 42:2C-1 et seq. All general and limited partner designations must be clearly described in this agreement. Requires registration with the New Jersey Division of Revenue and Enterprise Services.

Capital Contributions:

• Each partner shall contribute to the capital of the partnership as follows:
• [Partner 1 Name]: [Amount or Description of Contribution] (e.g., $[Dollar Amount] cash, [Description] property valued at $[Dollar Amount], [Number] hours of service)
• [Partner 2 Name]: [Amount or Description of Contribution]
• [Partner 3 Name]: [Amount or Description of Contribution] (Add more partners as needed)
• The contributions shall be made on or before [Date].
• Additional Contributions:
• Option A: No additional contributions shall be required of the partners.
• Option B: Additional capital contributions may be required upon a majority vote of the partners. The amount, timing, and manner of such contributions shall be determined by the partners at that time.

Ownership Interests, Profits, Losses, and Distributions:

• The ownership interests of the partners shall be as follows:
• [Partner 1 Name]: [Percentage]%
• [Partner 2 Name]: [Percentage]%
• [Partner 3 Name]: [Percentage]% (Add more partners as needed)
• Profits and Losses:
• Option A: Profits and losses shall be allocated among the partners in proportion to their ownership interests.
• Option B: Profits and losses shall be allocated according to each partner's capital account.
• Option C: Profits and losses shall be allocated as follows: [Specific allocation percentages for profits] and [Specific allocation percentages for losses].
• Distributions:
• Option A: Distributions of cash or other property shall be made to the partners [Frequency: e.g., quarterly, annually, at partner discretion] in proportion to their ownership interests.
• Option B: Distributions shall be made at the discretion of the managing partner(s).

Management and Authority:

• Management:
• Option A: All partners shall participate in the management and control of the partnership.
• Option B: [Partner Name(s)] shall be the managing partner(s) and shall have the authority to make day-to-day decisions regarding the partnership's business.
• Voting Rights:
• Option A: Each partner shall have one vote.
• Option B: Voting rights shall be proportional to each partner's capital contribution.
• Option C: Decisions require unanimity.
• Option D: Decisions require a majority vote.
• Major Acts: The following actions require the [Unanimity/Majority/Proportional] consent of the partners: admitting new partners, borrowing funds above $[Dollar Amount], amending this agreement.

Partner Duties and Limitations:

• Duties: Each partner shall devote their best efforts to the business of the partnership.
• Outside Business Activities:
• Option A: Partners are permitted to engage in outside business activities, provided they do not conflict with the interests of the partnership.
• Option B: Partners are prohibited from engaging in any outside business activities that are directly competitive with the partnership's business.

Admission of New Partners:

• New partners may be admitted to the partnership upon the [Unanimous/Majority] consent of the existing partners.
• The qualifications, capital contribution, and ownership interest of any new partner shall be determined by the partners at the time of admission.

Transfer of Partnership Interests:

• Restrictions: No partner may transfer or assign their partnership interest without the [Unanimous/Majority] written consent of the other partners.
• Right of First Refusal:
• Option A: If a partner desires to transfer their partnership interest, the other partners shall have a right of first refusal to purchase the interest at a price and on terms to be agreed upon, or if no agreement can be reached, at a price determined by an independent appraiser.
• Option B: No right of first refusal applies.

Partner Withdrawal:

• Voluntary Withdrawal: A partner may voluntarily withdraw from the partnership by providing [Number] months' written notice to the other partners.
• Involuntary Withdrawal:
• Option A: Involuntary withdrawal of a partner shall occur upon [Specific events, e.g., death, disability, bankruptcy].
• Buyout:
• Option A: Upon withdrawal, the withdrawing partner shall be entitled to a buyout of their partnership interest. The value of the interest shall be determined by [Valuation method, e.g., independent appraisal, book value]. Payment will be made within [Number] days/months.
• Option B: No buyout is required.

Expulsion of a Partner:

• Grounds for Expulsion: A partner may be expelled from the partnership for [Specific reasons, e.g., breach of this agreement, misconduct, bankruptcy] upon a [Unanimous/Majority] vote of the other partners.
• Compensation: Upon expulsion, the expelled partner shall be compensated for their partnership interest as determined by [Valuation Method].

Dissolution and Winding Up:

• Events Triggering Dissolution: The partnership shall dissolve upon the occurrence of any of the following events: expiration of the term (if applicable), unanimous vote of the partners, court order, [Specific events, e.g., death or incapacity of a partner].
• Winding Up: Upon dissolution, the assets of the partnership shall be liquidated, the liabilities shall be paid, and the remaining assets shall be distributed to the partners in proportion to their ownership interests.
• Continuation:
• Option A: Upon the death or withdrawal of a partner, the remaining partners may elect to continue the partnership.
• Option B: The partnership will automatically terminate.

Restrictions on Competition and Client Solicitation:

• Non-Compete:
• Option A: Upon withdrawal or expulsion, a partner shall not compete with the partnership within a [Number] mile radius of the partnership's principal place of business for a period of [Number] years. Enforceability is subject to New Jersey law, requiring reasonableness as to time, territory, and activity.
• Option B: No non-compete restrictions shall apply.
• Non-Solicitation:
• Option A: Upon withdrawal or expulsion, a partner shall not solicit the partnership's clients or employees for a period of [Number] years.
• Option B: No non-solicitation restrictions shall apply.

Confidentiality:

Each partner agrees to hold confidential all information relating to the partnership's business, trade secrets, and client information, both during and after the term of the partnership.

Indemnification:

The partnership shall indemnify each partner against any losses, damages, or liabilities incurred in connection with the partnership's business, except for losses resulting from the partner's gross negligence or willful misconduct. General partners are jointly and severally liable for partnership debts and obligations, while limited partners have limited liability consistent with New Jersey Law.

Partner Compensation:

• Option A: Partners shall receive draws against profits as determined by the managing partner(s).
• Option B: Partners shall receive salaries as follows: [Partner Name]: $[Dollar Amount] per [Time Period].
• Option C: Partners shall receive guaranteed payments as follows: [Partner Name]: $[Dollar Amount] per [Time Period].
• Expense Reimbursement: Partners shall be reimbursed for reasonable expenses incurred in connection with the partnership's business, subject to the partnership's expense reimbursement policy.

Records and Accounting:

• The partnership shall maintain accurate and complete books and records of its business.
• All partners shall have access to the partnership's books and records.
• The partnership shall conduct an annual audit of its financial statements.
• The fiscal year of the partnership shall end on [Date].

Tax Matters:

• [Partner Name] is designated as the Tax Matters Partner.
• Tax liabilities shall be allocated among the partners in proportion to their ownership interests. Ensure compliance with New Jersey state tax requirements, including registration and employer withholding if applicable.

Dispute Resolution:

• Any dispute arising out of or relating to this agreement shall be resolved as follows:
• Negotiation: The parties shall first attempt to resolve the dispute through good-faith negotiation.
• Mediation: If negotiation fails, the parties shall submit the dispute to mediation.
• Arbitration: If mediation fails, the parties shall submit the dispute to binding arbitration in accordance with the rules of the American Arbitration Association.
• Choice of Law/Venue: Any legal action will occur in [County Name] County, New Jersey.

Governing Law:

This agreement shall be governed by and construed in accordance with the laws of the State of New Jersey.

Death, Disability, or Incapacity:

• Option A: Upon the death, disability, or incapacity of a partner, the remaining partners shall have the option to purchase the deceased/disabled partner's interest.
• Option B: Upon the death, disability, or incapacity of a partner, the partnership shall terminate.

Insurance:

• Option A: The partnership shall maintain key person life insurance on [Partner Name(s)] in the amount of $[Dollar Amount].
• Option B: No insurance is required.

Anti-Discrimination and Harassment:

• Option A: The partnership is committed to providing a work environment free of discrimination and harassment. The partnership complies with all applicable federal and New Jersey state laws regarding anti-discrimination and anti-harassment.
• Option B: This clause is omitted from this agreement.

Required Filings and Compliance:

The partnership shall comply with all applicable New Jersey Secretary of State and Division of Revenue requirements, including annual filings and business registration.

Signatures:

_______________________________ [Partner 1 Full Legal Name]

_______________________________ [Partner 2 Full Legal Name]

_______________________________ [Partner 3 Full Legal Name] (Add more partners as needed)

Notary Acknowledgment (Optional - Required for certain New Jersey filings)

Other Clauses (Optional):

• Non-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.
• Severability: If any provision of this agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.
• Amendment: This agreement may be amended only by a written instrument signed by all of the partners (or as otherwise specified: [Amendment procedure, e.g., by [Number]% consent]).
• Notices: All notices required or permitted under this agreement shall be in writing and shall be deemed to have been duly given when delivered personally, sent by certified mail, return receipt requested, or sent by overnight courier to the addresses set forth above.
• Force Majeure: Neither party shall be liable for any failure to perform its obligations under this agreement if such failure is caused by a force majeure event.
• Entire Agreement: This agreement constitutes the entire agreement among the parties 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.