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PARTNERSHIP AGREEMENT FOR LEPRECHAUN PAINTERS

This AGREEMENT of PARTNERSHIP is made as of October 15, 2012 by and between Patricia Holmes, of 250 Steiner Street, Poughkeepsie, Dutchess County, New York 12601, Gary Lerner, of 81 Lookout Lane, Poughkeepsie, Dutchess County, New York 12601, and James Gleason, of 81 Evergreen Street, Hyde Park, Dutchess County, New York 12538 (partners).

RECITALS

The parties hereto wish: (a) to join together for the pursuit of common business goals; and (b) to enter into a partnership agreement as the most advantageous business form for their mutual purposes. NOW THEREFORE, in consideration of the premises and the mutual covenants and agreements set forth herein, the parties agree as follows:

ARTICLE 1. PURPOSE / PREFATORY INFORMATION

1.01. Name of Partnership. The name of the partnership shall be LEPRECHAUN PAINTERS, a partnership organized under the laws of the State of New York (herein after known as the partnership). This name will be registered in the office of the Dutchess County Clerk as the fictitious name of the partnership. 1.02. Purpose of the Partnership. The partnership shall engage in the following business: Provide interior and exterior residential painting services. The partnership may also engage in any activities that are related, complimentary, or incidental to this business purpose as may be agreed upon from time to time by the partners. 1.03. Duration. The partnership agreement shall begin upon the signing of the partnership agreement, and shall continue thereafter from year to year unless earlier terminated as hereinafter provided. 1.04. Principal Place of Business. The principal place of business shall be at 380 Lakeview Avenue, Poughkeepsie, Dutchess County, New York 12601.

ARTICLE 2. CONTRIBUTIONS

2.01. Initial Capital Contributions. The initial capital contribution to the partnership shall be $60,000, which shall consist of $30,000 in cash contributed by Patricia Holmes, for a 50% interest in the partnership, $15,000 in cash contributed by Gary Lerner, for a 25% interest in the partnership, and $15,000 in cash contributed by James Gleason, for a 25% interest in the partnership. 2.02. Property Contributions. At this time, no partner has any property to contribute to the partnership. 2.03. Additional Contributions. Ten percent of the net income of the partnership for each fiscal year shall be withheld from distribution and shall be credited as additional capital contributions of each of the partners. This retained income shall serve as a reserve fund for capital expenditures of the partnership.

ARTICLE 3. APPORTIONMENT OF PROFITS AND LOSSES

3.01. Profits. Each partner shall be entitled to an equal share of the net profits of the business. 3.02. Losses. All losses occurring in the course of business shall be borne equally unless the losses are due to the willful neglect or default, and not the mere mistake or error, of any of the partners, in which case the loss so incurred shall be borne solely by the partner or partners whose neglect or default caused the loss. 3.03. Distribution of Profits. Distribution of profits shall be made on the 1st of December of each year.

ARTICLE 4. MANAGEMENT AND CONTROL OF THE PARTNERSHIP BUSINESS

4.01. Duties of Partners. All partners of the partnership shall have an equal voice in the management and conduct of the partnership business. All decisions affecting the policy and management of the partnership may be made on behalf of the partnership by any active partner, until the establishment of a managing partner. Each partner shall devote to the business of the partnership full time services as reasonably necessary for the efficient operation of the business. 4.02. Check Signing Authority. All partners shall be authorized to sign checks from the partnerships bank account mentioned in 7.03 of this agreement. 4.03. Meetings. The partnership shall conduct monthly meetings held on the first Tuesday of every month at 2:00 p.m. at the principal office of the partnership to discuss matters of general interest to the partnership. In the event a special meeting is called upon by any of the partners, reasonable notice must be given.
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4.04. Limitations. The following activities of the partnership shall be conducted only through a unanimous vote of the partners and not through the action of a single partner acting individually: (1) (2) (3) (4) The assigning or conveying of partnership property; The transfer of individual partnership interest; Borrowing money in the partnerships name; The execution or delivery of any bond, deed of trust, mortgage, or a guarantee on behalf of the partnership; (5) The submission of any partnership claim to arbitration; and (6) Any other act for which unanimity is required as per this agreement. 4.05. Withdrawal of Capital. No partner may withdraw capital from the partnership until expense accounts and drawing accounts have been established by the partners for any partner. 4.06. Admission of New Partners. Unless prohibited elsewhere in the agreement, additional partners may be admitted upon a unanimous vote of the partners. Admission of new partners shall not constitute an event of dissolution of this partnership. Furthermore, admission of any new partner shall be contingent upon the prospective new partner agreeing to, and executing, this partnership agreement (as modified at the time of admission).

ARTICLE 5. INDEMNITY

Each partner shall be indemnified by the partnership on all obligations incurred by that partner in the normal course of conducting partnership business. The partners are limited by the provisions of 3.02 of this agreement in the scope of obligations they shall incur on behalf of the partnership.

ARTICLE 6. SALARY

6.01. Partner Salary. No partner shall be entitled to compensation for services he or she provides to the partnership separate and apart from said partners share of the partnership profits and losses as set forth in this agreement, except when the compensation to the partner for services has been set through a unanimous vote of the partners. 6.02. Treatment of Salary. These salaries shall be treated as an expense of the partnership in determining net profit and losses.

ARTICLE 7. RECORD KEEPING AND ACCOUNTING PROCEDURES

7.01. Records and Books. Each partner shall have the right, personally or through designation of an agent, to inspect and review the books and records of the partnership during normal business hours.
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7.02. Accounting Method and Fiscal Year. Accounting records and books shall be kept on a cash basis, and the fiscal year shall be the calendar year. 7.03. Bank. The partners designate the following as the partners business and checking accounts into which all the funds of the partnership shall be placed and maintained: The Valley Central Bank. A change of bank will require a unanimous vote of the partners. 7.04. Partnership Accountant. The partners designate the following as the partnerships accountant: Hunter Thompson, CPA of 823 Stirling Road, Hyde Park, Dutchess County, New York 12538. A change of the partnerships accountant requires a unanimous vote of the partners. 7.05. Audits. A compilation, review, or audit of the financial affairs and position of the partnership shall be made as of the close of each fiscal year of the partnership.

ARTICLE 8. PROPERTY RIGHTS AND TRANSFER OF INTEREST 8.01. Property Rights. No partner shall have any rights to the partnerships property. 8.02. Transfer of Partnership Interest. The interest of any partner may not be transferred in any manner by any partner unless written consent is given by every other partner.

ARTICLE 9. WITHDRAWAL, DEATH, REMOVAL OF PARTNER

9.01. Insurance. The partnership will purchase comprehensive liability insurance. The partnership will also purchase life insurance on the life of each partner, insuring for $100,000 each initially, to be increased after five (5) years, as agreed by the partners. Partners shall be named as beneficiaries on these policies. Upon death of a partner, life insurance shall be used to purchase the partners share in the business. Any remaining proceeds from insurance shall be distributed proportionately among the remaining partner(s) and the deceased partners estate. 9.03. Dissociation of Partners. (1) Voluntary Withdrawal of Partner a. Circumstances i. Partners shall have the unilateral right to resign or withdrawal from the partnership and are permitted to do so at the end of any fiscal year. ii. A partner is required to give two (2) months written notice of intent to withdrawal to each of the other partners. b. Procedures i. Upon withdrawal, the withdrawing partner shall receive payment of 25% cash and balance paid in monthly payments over four (4) years beginning six (6) months from date of withdrawal. ii. The remaining partner(s) have the right to purchase withdrawing partners share of the partnership and continue the business (as a sole
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proprietorship if only one partner remaining; as a partnership if two (2) or more partners remain). iii. The set price method for purchasing withdrawing partners share of the partnership is the buyout method, which is to be determined annually. iv. If remaining partner(s) choose(s) not to buyout withdrawing partner, the business shall be liquidated. (2) Expulsion of Partner a. Circumstances i. Any partner may be expelled for: 1. Commission of a felony; 2. Adjudication of insanity; or 3. Breach of partnership agreement. b. Procedures i. The partner to be expelled shall be provided the opportunity to refute charges prior to expulsion. ii. If the partner is expelled, said partners share in the partnership shall be subject to buyout in the same manner as for voluntary withdrawal stated in 9.03 (1)(b)(ii) and 9.03 (1)(b)(iv) of this agreement.

ARTICLE 10. TERMINATION OF THE PARTNERSHIP

Upon withdrawal, expulsion, or death of a partner, if the remaining partner(s) choose(s) not to purchase the interest of the dissociated partner, the business shall terminate and be liquidated.

ARTICLE 11. ARBITRATION

In the event of any dispute between the parties which arises under this agreement, such dispute shall be settled by arbitration in accordance with the rules for arbitration of the American Arbitration Association in effect at the time such arbitration is initiated. Arbitration is the sole remedy hereunder, and shall be held in accordance with the law of New York State, and judgment of any award may be entered in the courts of New York.

ARTICLE 12. SEVERABILITY

If any term or other provision of this agreement is determined to be invalid, illegal, or incapable of being enforced by any rule or law, or public policy, all other conditions and provisions of this agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this
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agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that transactions contemplated hereby are fulfilled to the extent possible.

ARTICLE 13. AMENDMENTS

The provisions of this agreement may be amended only by a unanimous vote of the partners. Any amendment of this agreement shall be in writing, dated, and executed by the consenting partners. If any conflict arises between the provisions of any amendment and the original agreement as previously amended, the most recent provisions shall control.

ARTICLE 14. ADDITIONAL PROVISIONS

Upon unanimous written consent of the partners, the business will be converted to a corporation. The stock of the corporation shall be distributed to the partners proportionately to their initial capital contributions to the partnership.

ARTICLE 15. SOLE AGREEMENT

This instrument contains the sole agreement of the parties relating to their partnership and correctly sets forth the rights, duties, and obligations of each partner to the other in connection with it as of its date. Any prior agreements, promises, negotiations, or representations not expressly set forth in this agreement are of no force or effect. Executed this ___________________ day of _________________________, 20_______ at Dutchess County, New York. _____________________________________ (Signature of Partner) _____________________________________ (Signature of Partner) _____________________________________ (Signature of Partner)