Deed of Partnership between more than Two Partners
This deed of partnership is made this ……… day of ……… 2000 between AB son of ……… residing at ……… of the first part, CD son of residing at ……… of the second part, EF son of ………… residing at ……… of the third part and GH son of ………… residing at ………… of the fourth part.
Now this deed witnesseth and the parties hereby agree as follows:
1. The parties hereto shall at present constitute and become partners of the firm ……… subject to the terms hereunder contained subject to such modification in its constitution or object clauses as may hereafter be agreed.
2. The name of the firm shall, at present be, etc., and the objects of the partnership shall, etc., the partners shall enter into engagements on behalf of the firm in the firm’s name only. The said name and the objects may be altered hereafter if so unanimously decided by all the partners then constituting the firm.
3. The business of the partnership shall be carried on at, etc., or at such other place or places as the partners shall from time to time determine.
4. The partners and their survivors will remain partners in the business, from the date of this deed, for a term of ……… years, if they, or any two of them, shall so long live, but subject to the provision for determination hereinafter contained.
5. Any partner may retire from the partnership at the end of ……… years, from the date of this deed, on giving to the other partners not less than—calendar months’ previous notice in writing of his intention to do so, and at the expiration of such notice the partnership shall, as regards the partner giving such notice, stand dissolved; and the partner retiring during the continuance of the partnership shall not, during the remainder of the partnership term, carry on or be interested directly or indirectly in any other business competing or in way interfering with the business of the partnership, within a radius of ……… miles from the site of the firm’s premises.
6. The retirement or death or insolvency of any partner shall not have the effect of dissolving the partnership between the partners; and the share of such retiring or deceased partner shall be purchased by one or more of the remaining partners at a price to be arrived at by the Auditor of the firm on the basis of last Balance Sheet and the working result upto the date of retirement and such sum will be paid to the retiring partner or the heirs of the deceased partner in four half-yearly instalments.
7. Every partner shall have a right to sell or mortgage his share or interest, but such partner, before selling or mortgaging it to a stranger, shall make the offer by registered letter to the other partners who shall have the first option to purchase the share at a valuation to be made. The Auditor shall value the share of the partner concerned on the basis of the Balance Sheet of the firm and in the event the outgoing partner does not agree to such valuation then he may get the share valued and he should be paid the average of the two valuations and such payment would be made in four half yearly instalments.
8. Every partner shall attend diligently to the business of the partnership and carry on the same for the greatest advantage of the partners; and no partner shall be directly or indirectly engaged or interested in any other trade or business except that of the partnership (or when required, substitute the following clause):
The said AB (or, etc.) shall be the manager of the business of the partnership and shall devote his whole time and attention to the management of the said business, he shall receive a salary of Rs. ……… per month for his service in the firm and shall not be directly or indirectly engaged or interested in any other trade or business except that of the partnership.
9. No partner shall without the written consent of the other partners do any of the following things, namely, dispose of, or encumber any of the assets of the firm, borrow any money or incur any liability on behalf of the firm or stop operation of any banking account or cancel any transaction entered into by the firm. No partner shall without the written consent of the other partners keep the business place closed or prevent any partner from entering the business premises of the firm. In these respects the decision of the majority of the partners will be treated as the consent of the partners and/or the firm.
10. Any partner may be expelled from the partnership after giving him opportunity to explain his conduct or allegations against him as regards fraudulent conduct misappropriation manipulation of accounts making secret profits or carrying on some other business competitive to the business of the firm or utilising the know-how and particulars of customers of the firm.
11. The capital of the partnership business shall be the sum of Rs. ……… made up and raised as follows, namely, etc. and any further capital which may be required hereafter shall be contributed by the partners in the proportions in which they shall for the time being be entitled to the net profits of the business.
12. Each partner shall be entitled to interest at the rate of ……… per cent per annum on the amount of his capital for the time being in the business, and at the rate of ……… per cent per annum for further advances.
13. The partners shall be entitled to share the net profit of the business as reflected by the audited accounts and shall share the losses reflected by the audited accounts of the firm in equal proportions irrespective of their capital contribution.
14. All outgoings and expenses of the partnership and all losses including interest and capital, shall be payable, first out of the profits, next, out of capital and in the case of further deficiency, by the partners in the proportion in which they are entitled to share in the net profits of the business.
15. An account of the partnership business shall be taken every six months, or at such times as the partners shall determine, and the net profits shall be divided between the partners.
16. All moneys and securities for money belonging to the partnership (except moneys required for current expenses) shall be paid into and deposited with K. Bank or such other bankers as the partners shall from time to time determine. Cheques drawn on partnership accounts shall be signed at least by two partners or by the authorised signatory.
17. The partners shall keep proper books of account which shall be kept at the place of business for the time being of the partnership, and each partner shall have access to and power to take copies of the same.
18. The partners shall get the accounts audited by a qualified auditor and such accounts to be finalised and copies of Profit and Loss Account and Balance Sheet to be furnished to each partner within six months of the closing of the Accounting Year which will end on 31st March every year.
19. If on the determination of the partnership by effluxion of time or otherwise than by death or retirement, there shall be two or more partners still living, an account shall be taken of the assets and the liabilities and transactions of the partnership and the assets as soon as they may be realized shall be applied first in the payment of the cost of realization, secondly in discharge of the liabilities of the firm; thirdly in payment of any unpaid profits or interest on capital due to any partner; fourthly in payment to each partner of the sums subscribed by each towards the capital; and lastly, the balance shall be divided among the partners for the time being in the shares, in which they shall then be entitled to the net profits of the partnership.
20. All the other matters, for which no provision is made in this deed, shall be decided by the majority of the partners.
21. All notices to be given either to partner or by a partner to the firm hereunder shall be deemed to be duly served if addressed to such firm or the partner at the address given hereinabove and sent by registered post.
22. Any dispute or difference which may arise between the partners or their heirs and representatives or between the firm and a partner with regard to the construction meaning and effect of this Deed or respecting accounts profits or losses of the business of the firm or the rights or liabilities of the partners hereunder or the dissolution or winding up of the business or any other matter relating to the firm shall be referred to arbitration of Mr. ……… and this clause shall be deemed to be the submission and/or reference to the Arbitrator or the procedure for appointment of the Arbitrator within the meaning of the Arbitration and Conciliation Act 1996 including any statutory modification thereof. In witness whereof the parties hereto have executed these presents on the day, month and year first above-written.
Signed, sealed and delivered by AB
the said AB, CD, EF and GH CD
respectively in the presence of: EF