General Partnership Agreement Template1 - Free Download | Page 5
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3.3 Net Profits and Losses.
Until otherwise unanimously agreed by the Partners, and subject to the provisions of this
Agreement, the net profits, if any, of the Partnership as determined at the end of each such Fiscal
Year shall be allocated among the Partners in proportion to the respective Capital Account of
each of the Partners as calculated at the end of each such Fiscal Year. All expenses incurred in
the course of the Business and all losses, if any, arising therefrom shall be borne out of the
earnings of the Business, or in the case of a deficiency, the losses shall be allocated amongst the
Partners pro rata to their respective individual Capital Accounts at the end of each such Fiscal
Each of the Partners may draw out of the Partnership, from time to time, on account of its
share of the net profits for the current year, a sum not exceeding their respective Capital
Accounts. Any sums drawn out by any Partner in excess of its share of the net profits for any
such year shall be repaid in full to the Partnership unless otherwise unanimously agreed by the
3.5 Financial Statements.
Proper accounts shall be kept of all transactions of the Business and at the end of each
Fiscal Year or as soon thereafter as possible, a statement shall be prepared showing the income
and expenses of the Business for the past year and what belongs and is due to each of the
Partners as its share of the profits.
3.6 Borrowing or Encumbrance of Partnership Interest.
Neither Partner shall, without the previous consent in writing of the other, sign or
encumber its share or interest in the Partnership, borrow money on behalf of the Business or, hire
any employee or subcontractor.
3.7 Payment of Obligations.
Each of the Partners shall punctually pay and discharge its separate debts, liabilities,
obligations, duties and agreements whether at present or future and keep indemnified the
Partnership property and the other Partner from all actions, proceedings, costs, claims and
demands of every nature.
If at any time either of the Partners is required to pay or become liable for more than its
proportion of the Partnership debts as provided for in this Agreement, that Partner shall have as
against the other Partner a right of recovery of the appropriate proportion of the payment or
indemnification against such liability, and the Partner shall have, on becoming liable for such
debt, the first lien or charge on the capital and all other interest or interests of the offending
Partner in the Partnership business.