A general partnership is a type of busines is created under a general partnership agreement, identified by the abbreviation "GP." A general partnership agreement sets out the rules governing the partnership and the role of the partners. A business that operates as a general partnership must comply with strict regulatory requirements and administrative formalities. This type of partnership involves the collaboration of two or more persons to achieve a goal by sharing their respective resources and any resulting profits.
Forming a partnership is of particular interest to professionals whose order allows them to practice as a partnership; however, this type of partnership is referred to as a limited liability partnership ("LLP").
This template is based on the relevant provisions under the Civil Code of Québec and sets out the terms governing a general partnership. It can, however, be used to draft a limited liability partnership agreement by making the necessary changes to comply with the Professional Code (Québec).
This document sets out the termsspecifically for a general partnership - and not a limited liability partnership (or other form of partnership). If using this template for the purposes of a limited liability partnership, you will be required to make the necessary changes to the content.
0.00 INTERPRETATION
0.01 Definitions
0.01.01 Activities
0.01.02 Agreement
0.01.03 Collaborators
0.01.04 Contribution
0.01.05 Contribution for Losses
0.01.06 Financial Year End
0.01.07 Founding Partner(s)
0.01.08 Interest(s)
0.01.09 Legal Representatives
0.01.10 Net Distributable Income
0.01.11 Ordinary Course of Business
0.01.12 Ordinary Resolution
0.01.13 Partner
0.01.14 Partnership
0.01.15 Prime Rate
0.01.16 Private Contributions
0.01.17 Reserved Contributions
0.01.18 Responsible Partner
0.01.19 Source Partner
0.01.20 Special Resolution
0.01.21 Unanimous Resolution
0.02 Entire Agreement
0.03 Applicable Law
0.04 Non-Compliance
0.04.01 Severability
0.04.02 Substitute Provision
0.05 Miscellaneous
0.05.01 Cumulative Rights
0.05.02 No Waiver
0.05.03 Time and Days
a) Time of the Essence
b) Computation of Time
c) Delays
0.05.04 Financial References
0.05.05 Gender and Number
0.05.06 Headings
1.00 INCORPORATION
1.01 Partnership Name
1.02 Family Name
1.03 Objective
1.04 Capital
1.05 Partnership’s Place of Business
1.05.01 Head Office
1.05.02 Change of Place of Business
1.05.03 Additional Business Locations
1.06 Legal Publicity
1.06.01 Enterprise Registrar
1.06.02 Former Partner
2.00 GOVERNANCE OF PARTNERSHIP
2.01 Administration
2.01.01 Board of Directors
2.01.02 Powers of Board of Directors
2.01.03 Dismissal and Replacement
2.01.04 Approval
a) By Unanimous Resolution:
b) By Special Resolution [OR Ordinary Resolution]:
2.01.05 Responsibility
2.02 Banking Matters
2.02.01 Commercial Bank Account
2.02.02 Signature or Endorsement
2.02.03 Trust Accounts
a) Deposits
b) Transaction
c) Minute Book
2.03 Books and Registers
2.03.01 Generally Accepted Accounting Principles (GAAP)
2.03.02 Access to Corporate Books
2.03.03 Determination by Auditor
2.04 Auditors
2.05 Financial Statements
2.06 Right to Borrow
2.07 Presumption
2.08 Admission of a New Partner
2.08.01 Eligibility
2.08.02 Procedure
2.08.03 Contribution
2.08.04 Roll Over
2.08.05 Right to Vote Deferred
2.09 Property of Partnership
2.09.01 Use
2.09.02 Preservation
2.09.03 Alienation
2.10 Expulsion from Partnership
3.00 GOVERNANCE OF PARTNERS
3.01 Meeting of PARTNERS
3.01.01 Annual Meeting
3.01.02 Special Meeting
3.01.03 Place of Meeting
3.02 Calling of Meetings
3.02.01 Notice of Meeting
3.02.02 Auditors
3.02.03 Waiver of Right to Notice
3.02.04 Incomplete Notice
3.02.05 Failure to Transmit Notice
3.03 Procedure at Meetings
3.03.01 Adjournment
3.03.02 Quorum
3.03.03 Right to Vote
3.03.04 Exercising Right to Vote
3.03.05 Proxies
a) Person
b) Instrument
c) Filing of Proxies
3.03.06 Presiding Officer
3.03.07 Procedure
3.03.08 Signed Resolution
3.04 Contributions to Partnership
3.04.01 Capital Contribution
a) Initial Contribution
b) Additional Contribution
c) Increase of Capital Contribution
d) Reimbursement due to Reduction of Capital
3.04.02 Reimbursement of Capital Contributions
a) Withdrawal of Investments
b) Interest
c) Reimbursement
3.04.03 Contribution by Credit
3.04.04 Contribution by Activities
3.05 Obligation to Participate in Activities
3.05.01 PARTNERS’ Efforts
3.05.02 Compliance
3.05.03 Interest of the Partnership
3.05.04 Ownership of PARTNERS’ Files
3.05.05 Express Request of a Client
3.06 Loyalty
3.07 Third-Party Liability
3.07.01 PARTNERS
3.07.02 Partnership
3.08 Prohibited Acts
3.09 Allocation of Losses
3.10 Contribution for Losses
3.11 Indemnification
3.12 Confidentiality
3.12.01 Scope of Undertaking
3.12.02 Duration of Undertaking
3.12.03 Violation of Undertaking
a) Penalty
b) Payment
c) Protective Measures
3.13 Non-Competition
3.13.01 Scope of Undertaking
3.13.02 Breach of Undertaking
a) Penalty
b) Payment
c) Protective Measures
3.15 Non-Solicitation of Clients
3.15.01 Scope of Undertaking
3.15.02 Breach of Undertaking
a) Penalty
b) Payment
c) Protective Measures
3.16 Profit Sharing
3.16.01 Point System
a) Contribution in Capital (Category 1)
b) Contribution in Time (Category 2)
c) Contribution in Clientele (Category 3)
d) Contribution in Experience (Category 4)
e) Contribution in Skill (Category 5)
3.16.02 Determination of Net Income
3.16.03 Annual Allocation of Net Income
a) Net Income Statement
b) Approval of PARTNERS
c) Allocation
d) Loss
3.16.04 Suspension of Right to Share in Profits
3.17 Draws
3.17.01 Weekly
3.17.02 Quarterly
3.17.03 Proportion
3.17.04 Reimbursement of Overpayment
3.18 Reimbursement of Expenditures
3.18.01 Ordinary Course of Business
3.18.02 Significant Expenditure
3.18.03 Allocation for Expenditures
3.18.04 Reimbursement Date
3.19 Work in Progress
3.20 Right of Access to Documents
3.20.01 Consulting
3.20.02 Disclosure Prohibited
a) Information Protected
b) Penalty
3.20.03 Operations of Partnership
3.21 Retirement and Retirement Fund
3.21.01 Retirement Age
3.21.02 Decision-Making Process
3.21.03 Deferral of Decision
3.22 Disability
3.22.01 Calculation
3.22.02 Period of Entitlement
3.22.03 End of Entitlement
3.23 Time Off
3.23.01 Vacation Time
3.23.02 Time May Not be Accumulated
3.23.03 Extended Leave
a) Duration
b) Extending Duration
c) Reduction of Income
d) Concurrent Time Off
e) Determining Preference
f) Prior Notice
3.24 Personal Financial Affairs
3.25 Hypothec on Assets
4.00 WITHDRAWAL OF A PARTNER
4.01 Voluntary Withdrawal
4.01.01 Procedure
4.01.02 Notice
4.01.03 Refusal
4.01.04 Terms of Payment
a) Internal Sale
b) Outside Offer
c) Return of Interest
4.02 Forced Withdrawal
4.02.01 Procedure
4.02.02 Method of Payment
4.03 Dispute
4.03.01 Procedure
a) Offer
b) Value of Interest
4.03.02 Notice
4.03.03 Failure to Notify
4.03.04 Compliance with Procedure
4.04 Release and Reimbursement
5.00 OUTSIDE OFFER TO PURCHASE
5.01 Offer to Purchase All or Part of a Partner’s Interest
5.01.01 Definitions
5.01.02 Application and Notice of Sale
5.01.03 First Option to Purchase
a) Application
b) Scope
c) Validity
5.01.04 Second Option to Purchase
a) Application
b) Scope
c) Validity
5.01.05 Refusal
a) Outside Offer
b) Approval of Transfer
c) Amending Conditions of Offer
5.01.06 Closing Session
5.01.07 Terms and Conditions of Payment
5.01.08 Liquidated Damages
5.02 Offer to Purchase all Partnership Interests
5.02.01 Definitions
5.02.02 Application
5.02.03 Notice of Acceptance and Disclosing of Outside Offer
5.02.04 Reply of Minority Partners Regarding Options
a) Time Limit and Notice
b) Presumption
c) Terms of Sale
5.02.05 Amendment of Outside Offer
5.03 Outside Offer in Good Faith
5.04 Waiver
6.00 DEATH OF A PARTNER
6.01 Status
6.02 Compulsory Sale
6.03 Terms of Payment
6.03.01 Initial Amount
6.03.02 Balance
6.03.03 Interest
6.03.04 Promissory Note
6.03.05 Disbursements
6.03.06 Expiry of Term
6.03.07 Advance Payment
6.03.08 Solidary and Indivisible Obligation
6.03.09 Default of Term
6.04 Two Deaths Within Sixty Days
6.05 Protecting the Estate
6.05.01 Net Distributable Income
6.05.02 Indemnification
6.05.03 Release
6.06 Primacy of Part 6.00
7.00 VALUATION OF INTERESTS
7.01 Value
7.02 Determining the Initial Value
7.03 Accounts
7.04 Alternate Valuation
7.04.01 Auditors
7.04.02 External Auditor
7.04.03 Rules for Valuation of an Interest
8.00 FINANCING
8.01 Life Insurance Policy
8.01.01 Initial Policy
8.01.02 Additional Policies
8.02 PARTNERS’ Obligations
8.02.01 Payment of Premiums
8.02.02 Prohibition
8.02.03 Additional Protection
a) Increase Amount
b) Disclosure
8.02.04 Changes to Coverage
8.02.05 Sale Upon Death
8.02.06 Sale Upon Withdrawal
8.02.07 Dissolution of Partnership
8.02.08 End of Contract
9.00 SPECIAL PROVISIONS
9.01 Assignment
9.02 Independent Legal Advice
9.03 Fundamental Provisions
10.00 GENERAL PROVISIONS
10.01 Notice
10.02 Arbitration
10.03 Choice of Forum
10.04 Amendment
10.05 No Waiver of Rights
11.00 TERMINATION
11.01 Triggers for Dissolution
11.02 Liquidation of Partnership
11.02.01 Notice
11.02.02 Statement of Accounts
11.02.03 Conversion into Legal Tender
11.02.04 Dissolution Agreement
11.02.05 Payment of Debts
11.02.06 Sharing of Residual Assets
a) Distribution
b) Work in Progress
c) Dispute
11.02.07 Clients
11.02.08 Collecting Partnership’s Receivables
11.02.09 Use of Partnership’s Name
12.00 EFFECTIVE DATE
13.00 DURATION
13.01 Renewal
13.02 Withdrawal of a Partner
13.03 Continuation of Partnership
14.00 SCOPE
14.01 Agreement
14.02 Previous Agreement
SCHEDULE 0.01.04 – CONTRIBUTIONS
SCHEDULE 0.01.16 – LIST OF PRIVATE CONTRIBUTIONS
SCHEDULE 0.01.17 – RESERVED CONTRIBUTIONS
SCHEDULE 3.15.01 – CLIENTS OF PARTNERSHIP
SCHEDULE 4.01.04 – VALUE OF INTERESTS
SCHEDULE 8.01.01 – LIFE INSURANCE