Vermont partnership agreement template

Vermont Partnership Agreement

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

• [Partner 1 Name], residing at [Partner 1 Address] (“[Partner 1 Title, e.g., Managing Partner]”)
• [Partner 2 Name], residing at [Partner 2 Address] (“[Partner 2 Title, e.g., Partner]”)
• [Partner 3 Name], residing at [Partner 3 Address] (“[Partner 3 Title, e.g., Partner]”)

1. Recitals

This Agreement is made with reference to the following facts:

• The Partners desire to form a partnership for the purpose of [Purpose of Partnership].
• The Partnership shall be known as [Partnership Business Name].
• The nature and scope of the Partnership’s business shall be [Description of Business].
• The principal place of business of the Partnership shall be [Business Address].
• This Partnership shall be a [General or Limited] Partnership.

2. Formation

• Option A: Formation of General Partnership.
• Option B: Formation of Limited Partnership, registered with the Vermont Secretary of State.
• Option C: Formation of a Limited Liability Partnership (LLP), registered with the Vermont Secretary of State.

3. Effective Date and Term

• Option A: This Agreement shall become effective as of [Effective Date].
• Option B: The term of the Partnership shall be:
  • At-will, terminable by any Partner as provided herein.
  • For a specific project: [Project Name].
  • For a designated time frame: [Number] years, commencing on [Start Date], and terminating on [End Date].
• Option C: Renewal of the term of the Partnership:
  • Upon mutual written consent of the Partners.
  • Automatically for successive terms of [Number] years, unless terminated.

4. Capital Contributions

• Each Partner shall contribute to the capital of the Partnership as follows:
  • [Partner 1 Name]:
    • Initial Contribution: [Dollar Amount] or [Description of Asset].
    • Due Date: [Date].
  • [Partner 2 Name]:
    • Initial Contribution: [Dollar Amount] or [Description of Asset].
    • Due Date: [Date].
  • [Partner 3 Name]:
    • Initial Contribution: [Dollar Amount] or [Description of Asset/Service].
    • Due Date: [Date].
• Option A: Future Contributions:
  • The Partners may be required to make additional capital contributions as determined by [Vote Requirement, e.g., Majority Vote].
  • Additional contributions will be allocated [Allocation Method, e.g., Proportional to Ownership].
• Option B: No Future Contributions are required.

5. Ownership Interests

• The Partnership interests shall be divided as follows:
  • [Partner 1 Name]: [Percentage]%.
  • [Partner 2 Name]: [Percentage]%.
  • [Partner 3 Name]: [Percentage]%.
• Option A: Adjustment of Interest:
  • Partnership interests may be adjusted to reflect subsequent capital contributions or withdrawals.
  • The formula for adjusting interests is: [Description of Formula].
• Option B: Classes of Interest:
  • The Partnership interests shall be divided into classes with the following rights: [Description of Rights and Limitations].

6. Allocation of Profits, Losses, and Distributions

• The profits and losses of the Partnership shall be allocated as follows:
  • Option A: Per capita.
  • Option B: Proportional to capital contributions.
  • Option C: As follows: [Description of Allocation Method].
• Distributions shall be made:
  • Option A: At the discretion of the [Managing Partner or Majority Vote].
  • Option B: Quarterly.
  • Option C: Annually.
• Reinvestment Options: [Description of Reinvestment Options].
• Tax Allocation: All allocations shall be made in accordance with Subchapter K of the Internal Revenue Code.

7. Powers, Duties, and Management Structure

• The management of the Partnership shall be vested in:
  • Option A: All Partners.
  • Option B: A Managing Partner: [Name of Managing Partner].
  • Option C: An Executive Committee comprised of: [List of Partners on Committee].
• Decision-Making:
  • Ordinary decisions shall be made by [Majority or Unanimous] vote.
  • Extraordinary decisions (such as admitting new partners, amending the agreement, incurring debt exceeding [Dollar Amount], selling significant assets, or changing the business purpose) shall require [Supermajority or Unanimous] vote.
• Withdrawal and Admission of Partners: [Description of Process].

8. Partner Duties

• Each Partner shall owe to the Partnership the fiduciary duties of loyalty and care.
• Option A: Restrictions on Competition:
  • Partners shall not compete with the Partnership during the term of this Agreement.
  • Partners shall not solicit clients or employees of the Partnership during the term of this Agreement and for [Number] years thereafter.
• Option B: Waiver of certain duties (to the extent permitted by Vermont law): [Description of Waived Duties].
• Obligations for record-keeping and reporting.

9. Record Keeping, Banking, and Tax Filings

• The Partnership shall maintain complete and accurate records of all transactions.
• Banking: The Partnership shall maintain accounts at [Name of Bank].
• Tax Matters Partner/Partnership Representative: [Name of Partner] shall be the Tax Matters Partner or Partnership Representative under the Bipartisan Budget Act of 2015.
• The partnership will comply with Vermont tax registration requirements.

10. Partner Compensation

• Option A: No partner shall receive a salary for services rendered to the partnership.
• Option B: [Partner Name] shall receive a salary of [Dollar Amount] per [Time Period] for services rendered.
• Guaranteed Payments: [Description of Guaranteed Payments, if any].

11. Partner Withdrawal, Retirement, Expulsion, Incapacity, and Death

• Voluntary Withdrawal: A Partner may withdraw from the Partnership upon [Number] days written notice to the other Partners.
• Involuntary Withdrawal: [Description of Events Triggering Involuntary Withdrawal].
• Buyout of Interest:
  • Valuation: The value of the withdrawing Partner's interest shall be determined by [Appraisal Process].
  • Payment Terms: [Description of Payment Terms].
  • Non-Compete: [Optional Non-Compete Clause].

12. Dissolution and Winding Up

• Events Causing Dissolution:
  • Option A: Unanimous vote of the Partners.
  • Option B: Expiration of the term of the Partnership.
  • Option C: Court decree under Vermont law.
• Procedures for Dissolution:
  • Creditor priority in accordance with Vermont law.
  • Asset liquidation procedures.
  • Notice to and settlement with creditors.
  • Final allocation and distribution rules in compliance with Vermont Title 11 V.S.A. and the Uniform Partnership Act.

13. Indemnification and Insurance

• Indemnification: The Partnership shall indemnify the Partners to the fullest extent permitted by law.
• Insurance:
  • Option A: The Partnership shall maintain [Type of Insurance] insurance in the amount of [Dollar Amount].
  • Option B: Insurance is not required.

14. Assignment and Transfer of Interests

• Option A: No Partner may assign or transfer their Partnership interest without the consent of all other Partners.
• Option B: Rights of First Refusal:
  • If a Partner desires to sell their interest, the other Partners shall have a right of first refusal.
  • The terms of the right of first refusal shall be: [Description of Terms].

15. Dispute Resolution

• Option A: Negotiation between partners.
• Option B: Vermont Mediation.
• Option C: Binding Vermont Arbitration.
• Option D: Court Jurisdiction in [County Name] County, Vermont.

16. Applicable Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont, including Vermont’s adoption of the Uniform Partnership Act.

17. Anti-Discrimination

The Partnership is committed to providing equal opportunities and does not discriminate on the basis of race, color, religion, sex, national origin, age, disability, or any other characteristic protected by Vermont or federal law.

18. Amendment

This Agreement may be amended only by a written instrument signed by all Partners.

19. Waiver and Severability

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. If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall remain in full force and effect.

20. Entire Agreement

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings, both written and oral.

21. 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.

22. Vermont-Specific Disclosures

• Option A: Registered Agent: The Partnership’s registered agent is [Registered Agent Name], located at [Registered Agent Address].
• Option B: Compliance with Vermont tax registration, workers’ compensation, and withholding is required.
• Option C: None required.

23. Intellectual Property and Confidentiality

All intellectual property created by the Partnership shall be owned by the Partnership. Each Partner shall maintain the confidentiality of the Partnership’s confidential information.

24. Non-Solicitation/Non-Compete

• Option A: During the term of this Agreement and for a period of [Number] years thereafter, each Partner shall not solicit the employees or customers of the Partnership.
• Option B: None.

25. Meetings

• The Partners shall hold regular meetings at least [Frequency, e.g., Annually].
• Notice of meetings shall be given at least [Number] days prior to the meeting date.

26. Limited Partnership Provisions (if applicable)

• [Name of General Partner(s)] are the General Partner(s).
• [Name of Limited Partner(s)] are the Limited Partner(s).
• The Limited Partners' capital at risk is limited to their capital contribution.

27. Partnership Taxation

• The Partnership will file taxes as a [Flow-through entity/Partnership].
• [Partner Name] is responsible for partnership tax allocations and filings.

28. Health and Safety

The Partnership shall comply with all applicable Vermont occupational safety regulations.

29. Schedules and Addenda

The following schedules and addenda are attached to and incorporated into this Agreement:

• [Schedule A: Buy-Sell Agreement].
• [Schedule B: Supplemental Policies].

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]