Texas limited liability partnership agreement template

Texas Limited Liability Partnership Agreement

This TEXAS LIMITED LIABILITY PARTNERSHIP AGREEMENT (this "Agreement") is made and effective as of [Date], by and among [Partner Name 1], [Partner Address 1], [Partner Name 2], [Partner Address 2], and any others who may become partners in accordance with the terms of this Agreement.

1. Formation and Name

The parties hereby form a Limited Liability Partnership (LLP) under the provisions of the Texas Business Organizations Code (the "BOC").

The name of the LLP shall be [LLP Name].

Option A: The LLP shall conduct business under its stated name.

Option B: The LLP shall also conduct business under the assumed name(s) of [Assumed Name(s)], which shall be properly registered with the Texas Secretary of State.

2. Purpose and Scope of Business

The purpose of the LLP is to engage in the business of [Business Description] (the "Business").

Option A: The LLP is authorized to engage in any and all activities necessary or incidental to the foregoing.

Option B: The LLP shall be limited to the following activities: [List of Limited Activities]. The LLP shall not engage in any activities outside this list.

3. Principal Place of Business

The principal place of business of the LLP shall be located at [Address in Texas] in the State of Texas.

4. Registered Office and Registered Agent

The registered office of the LLP in the State of Texas shall be located at [Registered Office Address].

The registered agent of the LLP in the State of Texas shall be [Registered Agent Name], whose address is [Registered Agent Address].

5. Partners

The initial partners of the LLP are:

• [Partner Name 1], residing at [Partner Address 1], with an ownership percentage of [Percentage]%.
• [Partner Name 2], residing at [Partner Address 2], with an ownership percentage of [Percentage]%.

Option A: All partners shall be general partners.

Option B: The LLP will only include Managing Partners.

6. Capital Contributions

Each partner shall contribute the following initial capital to the LLP:

• [Partner Name 1]: [Amount] (Cash/Property Description)
• [Partner Name 2]: [Amount] (Cash/Property Description)

Option A: No additional capital contributions shall be required of the partners.

Option B: Additional capital contributions may be required as determined by a vote of [Percentage]% of the partners.

• If additional capital contributions are required, each partner shall contribute in proportion to their ownership percentage.
• The method of valuing in-kind contributions will be [Valuation Method].

Defaulted Contributions:

• If a partner fails to make a required capital contribution, the other partners may:
• Option A: Loan the amount to the defaulting partner at an interest rate of [Interest Rate].
• Option B: Reduce the defaulting partner's ownership percentage in proportion to the unpaid contribution.

7. Allocation of Profits and Losses

Profits and losses of the LLP shall be allocated to the partners in proportion to their ownership percentages.

Option A: Profits and losses shall be allocated according to the partners' capital accounts.

Option B: Profits and losses shall be allocated according to a different formula, as follows: [Description of Alternative Allocation Formula].

8. Distributions

Distributions of cash flow 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 the partners’ ownership percentages.

Option B: Distributions shall be made according to the following priority: [Description of Distribution Priority].

9. Management

The management of the LLP shall be vested in the partners.

Option A: Each partner shall have equal management authority and voting rights.

Option B: Management shall be vested in a Managing Partner. [Managing Partner's name]

• The Managing Partner shall have the authority to make all decisions regarding the management of the LLP.
• The Managing Partner shall be entitled to compensation for their services in the amount of [Compensation Amount].

10. Meetings

Meetings of the partners shall be held at least [Frequency].

Option A: Meetings may be called by any partner.

Option B: Meetings may only be called by [Designated Partner(s) or Position].

Notice of meetings shall be given to all partners at least [Number] days prior to the meeting.

A quorum for any meeting shall consist of [Percentage]% of the partners.

Minutes of all meetings shall be kept by [Designated Partner or Position].

11. Decision Making

Decisions regarding the LLP shall be made by a vote of [Percentage]% of the partners.

Option A: Certain major decisions shall require unanimous consent of the partners. These decisions include:

• Admitting a new partner
• Merging with another entity
• Selling all or substantially all of the assets of the LLP
• Dissolving the LLP

Option B: All decisions can be made by majority vote.

12. Term and Termination

The term of the LLP shall commence on the effective date of this Agreement and shall continue until terminated as provided herein.

Option A: The LLP shall continue for a term of [Number] years.

Option B: The LLP shall continue indefinitely until terminated.

The LLP may be terminated by a vote of [Percentage]% of the partners.

Upon termination, the assets of the LLP shall be distributed to the partners in proportion to their ownership percentages.

13. Admission of New Partners

New partners may be admitted to the LLP with the consent of [Percentage]% of the existing partners.

Option A: New partners shall be required to make a capital contribution to the LLP.

Option B: New partners will not be required to make a capital contribution.

All new partners must sign an agreement to be bound by the terms of this Agreement and must file a Statement of Qualification with the Texas Secretary of State under BOC §152.802.

14. Assignment and Transfer

No partner may assign or transfer their interest in the LLP without the consent of [Percentage]% of the other partners.

Option A: The other partners shall have a right of first refusal to purchase the interest of any partner who desires to assign or transfer their interest.

Option B: There is no right of first refusal. The assigning partner can sell to anyone they want.

15. Withdrawal, Expulsion, and Retirement

A partner may withdraw from the LLP by giving [Number] days' written notice to the other partners.

Option A: A partner who withdraws from the LLP shall be entitled to receive the fair market value of their interest in the LLP.

Option B: A partner who withdraws shall be entitled to receive their capital account balance at the time of withdrawal.

A partner may be expelled from the LLP for cause by a vote of [Percentage]% of the other partners. "Cause" shall include [Definition of Cause].

16. Limited Liability

Pursuant to the BOC §152.801 et seq., the partners of the LLP shall not be personally liable for the debts and obligations of the LLP, except to the extent of their own negligence, wrongful acts, or misconduct.

This Agreement explicitly disclaims the creation of a general partnership or limited partnership under Texas law.

17. Indemnification

The LLP shall indemnify and hold harmless each partner from and against any and all losses, damages, liabilities, costs, and expenses (including attorneys' fees) incurred by such partner in connection with the business of the LLP.

Option A: This indemnification shall not apply to losses, damages, liabilities, costs, and expenses incurred as a result of the partner's gross negligence or willful misconduct.

Option B: The level of indemnification is unlimited.

18. Insurance

The LLP shall maintain insurance policies in such amounts and with such coverages as the partners may deem necessary.

Option A: The LLP shall maintain professional liability insurance in the amount of [Amount].

Option B: The LLP shall obtain general liability insurance in the amount of [Amount].

19. Records and Accounting

The LLP shall keep accurate and complete books and records of its business.

All partners shall have access to the books and records of the LLP.

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

20. Dispute Resolution

Any dispute arising out of or relating to this Agreement shall be resolved through mediation.

Option A: If mediation is unsuccessful, the dispute shall be resolved through binding arbitration in accordance with the rules of the American Arbitration Association.

Option B: If mediation is unsuccessful, either party can pursue legal action in a Texas court.

The exclusive jurisdiction and venue for any legal action shall be in [County] County, Texas.

21. Non-Compete

During the term of this Agreement and for a period of [Number] years following the termination of this Agreement, no partner shall engage in any business that is competitive with the Business of the LLP within a [Number] mile radius of the principal place of business of the LLP.

22. Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

23. Tax Matters Partner

[Partner Name] is hereby designated as the Tax Matters Partner (Partnership Representative under IRS rules) of the LLP.

24. Compliance

The LLP shall comply with all applicable Texas statutes, industry regulations, and licensing and registration requirements.

25. Amendment

This Agreement may be amended by a vote of [Percentage]% of the partners.

26. Notices

All notices required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given when delivered in person, or by certified mail, return receipt requested, to the addresses set forth in this Agreement.

27. Counterparts and Electronic Signatures

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. Electronic signatures shall be permitted and have the same force and effect as original signatures.

28. Entire Agreement

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous communications and proposals, whether oral or written.

29. Representations and Warranties

Each partner represents and warrants that they have the full power and authority to enter into this Agreement and to perform their obligations hereunder.

30. Limitation of Liability Notice

All contracts and public materials of the Partnership shall contain the following notice: "The partners of this limited liability partnership are not personally liable for the debts and obligations of the partnership, except as provided by law."

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

[Partner Name 1]

[Signature]

[Partner Name 2]

[Signature]