KNOW ALL MEN BY THESE PRESENTS:
This Partnership Agreement is executed this (insert date) by and between:
(insert name of corporation), a corporation duly organized and existing in accordance with laws of the Republic of the Philippines, with principal offices at (state address), represented in this act by its President, (state name of representative), hereinafter referred to as the FIRST PARTY;
(insert name of corporation), a corporation duly organized and existing in accordance with laws of the Republic of the Philippines, with principal offices at (state address), represented in this act by its President, (state name of representative), hereinafter referred to as the SECOND PARTY.
WHEREAS, the Parties have agreed to make contributions to a common fund for the purpose of acquiring, holding and operating a (state nature of business) hereinafter referred to as the business interest.
WHEREAS, the Parties have agreed, in pursuit of the business interest, to enter into a Partnership pursuant to the Partnership Laws of the Philippines.
NOW THEREFORE, the parties agree as follows:
1. Name and Business
The parties hereby form a partnership under the name of (state name of partnership) to conduct the business interest. The principal office of the business shall be in (state address of the office).
The partnership shall commence on (state date of commencement) and shall continue to exist until terminated as herein provided.
The capital of the partnership shall be contributed by the partners as follows:
Nature of Contribution (Cash, Property, Service, etc.)
A separate capital account shall be maintained for each partner. Neither partner shall withdraw any part of his capital account. Upon the demand of either partner, the capital accounts of the partners shall be maintained at all times in the proportions in which the partners share in the profits and losses of the partnership.
4. Profit and Loss
Both the net profits and net losses of the partnership shall be divided and borne equally between the partners. A separate income account shall be maintained for each partner. Partnership profits and losses shall be charged or credited to the separate income account of each partner. If a partner has no credit balance in his income account, losses shall be charged to his capital account.
5. Salaries and Drawings
No partner shall receive any salary for services rendered to the partnership. Each partner may, from time to time, withdraw the credit balance in his income account. All other expenses incurred by the parties in the pursuit of the business interest shall be accounted for in accordance with policies to be mutually set by the parties in accordance with generally accepted accounting principles.
No interest shall be paid on the initial contributions to the capital of the partnership or on any subsequent contributions of capital.
The partners shall have equal rights in the management of the partnership business, and each partner shall devote his entire time to the conduct of the business. A managing partner may be designated by the parties subject to the exigencies of the partnership. Without the consent of the other partners, no partner shall on behalf of the partnership borrow or lend money, or make, deliver, or accept any commercial paper, or execute any mortgage, security agreement, bond, or lease, or purchase or contract to purchase, or sell or contract to sell any property for or of the partnership other than the type of property bought and sold in the regular course of its business.
All funds of the partnership shall be deposited in its name in such checking account or accounts as shall be designated by the partners. All withdrawals therefrom are to be made upon checks signed by at least two partners.
The partnership books shall be maintained at the principal office of the partnership, and each partner shall at all times have access thereto. The books shall be kept on a fiscal year basis in accordance with generally accepted accounting principles and shall be closed and balanced at the end of each fiscal year. An audit shall be made as of the closing date.
10.1 The partnership may be dissolved at any time by agreement of the partners, in which event the partners shall proceed with reasonable promptness to liquidate the business of the partnership. The partnership name shall be sold with the other assets of the business.
10.2 The assets of the partnership business shall be used and distributed in the following order: (a) to pay or provide for the payment of all partnership liabilities and liquidating expenses and obligations; (b) to equalize the income accounts of the partners; (c) to discharge the balance of the income accounts of the partners; (d) to equalize the capital accounts of the partners; and (e) to discharge the balance of the capital accounts of the partners.
11.1 Upon the death of a partner, the surviving partner/s shall have the right either to purchase the interest of the decedent in the partnership or to terminate and liquidate the partnership business. If the surviving partner elects to purchase the decedent's interest, he shall serve notice in writing of such election, within three months after the death of the decedent, upon the executor or administrator of the decedent, or, if at the time of such election no legal representative has been appointed, upon any one of the known legal heirs of the decedent at the last-known address of such heir.
11.2 If the surviving partner/s elect/s to purchase the interest of the decedent in the partnership, the purchase price shall be equal to the decedent's capital account as at the date of his death plus the decedent's income account as at the end of the prior fiscal year, increased by his share of partnership profits or decreased by his share of partnership losses for the period from the beginning of the fiscal year in which his death occurred until the end of the calendar month in which his death occurred, and decreased by withdrawals charged to his income account during such period.
11.3 No allowance shall be made for goodwill, trade name, patents, or other intangible assets, except as those assets have been reflected on the partnership books immediately prior to the decedent's death; but the survivor shall nevertheless be entitled to use the trade name of the partnership.
12. Arbitration and Attorneys Fees
The Parties agree that any dispute, claim, or controversy concerning this Agreement or the termination of this Agreement, or any dispute, claim or controversy arising out of or relating to any interpretation, construction, performance or breach of this Agreement, shall be settled in good faith by the parties. If no agreement is reached, the Parties shall refer the same to arbitration in accordance with Philippine arbitration rules then in effect. The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction. The Parties will pay the costs and expenses of such arbitration in such proportions as the arbitrator shall decide, and each party shall separately pay its own counsel fees and expenses.
13. Final Agreement
This Agreement terminates and supersedes all prior understandings or agreements on the subject matter hereof. This Agreement may be modified only by a further writing that is duly executed by both parties.
If any term of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, then this Agreement, including all of the remaining terms, will remain in full force and effect as if such invalid or unenforceable term had never been included.
15. No Implied Waiver
Either party's failure to insist in any one or more instances upon strict performance by the other party of any of the terms of this Agreement shall not be construed as a waiver of any continuing or subsequent failure to perform or delay in performance of any term hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and place above specified.
FIRST PARTY SECOND PARTY
SIGNED IN THE PRESENCE OF:
REPUBLIC OF THE
BEFORE ME, this (insert date) in (insert place), personally appeared:
known to me to be the same persons who executed the foregoing instrument consisting (state number of pages) pages including this Acknowledgment, and who acknowledged to me that the same is their voluntary and free act and deed and those of the parties and institutions represented.
IN WITNESS WHEREOF, I set my hand and affix my notarial sea on the date and place above written.
Doc. No. _____;
Page No. _____;
Book No. _____;
Series of ______.