DIY Legal Forms

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Partnership Dissolution Agreement

1. Introduction and Recitation. Agreement made [date] by and between [name] whose address is [address] (First Partner) and [name] whose address is [address] (Second Partner).

WHEREAS, the parties to this Agreement are engaged in business under the name of [name of partnership], a partnership located at [address] (the Partnership); and

WHEREAS, the parties entered into a partnership agreement dated [date] (the Partnership Agreement), a copy of which is annexed hereto [omitted]; and

WHEREAS, the parties wish to terminate and liquidate the Partnership;

NOW, THEREFORE, the parties agree as follows:

2. Termination of Partnership. The Partnership and the Partnership Agreement are hereby terminated. The business of the Partnership is to be completely liquidated no later than the close of business on [date].

3. No Further Business. No further business shall be conducted by the Partnership and no further obligations entered into by the Partnership except for the purpose of liquidating the Partnership.

4. Inventory and Statement of Account. Before any liquidation of assets is carried out, a complete and accurate inventory shall be taken of all goods, fixtures, and other assets on hand, with the exception of [set out any assets that are to be distributed to the partners]. The sale of these assets are to be made as expeditiously as possible and the highest possible price by [state name and address of liquidating agent]. All of the Partnership's debts and legal obligations that are unpaid as of the date of this Agreement and all debts and expenses incurred by the Partnership in liquidating the Partnership's assets shall be paid or compromised on the best terms available before any distributions are made to the parties.

5. Determination of Partnership Interests. The Partnership's book of account shall be closed as of the close of business on [date], at which time an account shall be stated between the partners. Subject to the provisions of Paragraph 6, the statement of account shall show each partner's full share of the assets of the partnership as shown on the books of account. In arriving at the value of the Partnership's assets, the value of the goodwill of the partnership, all of which is attributable to the Partnership's name, is deemed to be ---------- dollars ($----------) and the value of [set out any assets that are to be distributed to the partners] is deemed to be ---------- dollars ($----------). The Partnership's books of account are to be closed and the statement of account prepared by [name], Certified Public Accountants and their determinations shall be final and binding upon the parties.

6. Distribution to Partners. Upon the liquidation of the parties' interests in the Partnership, each Partner is to be paid the value of his or her share of the Partnership's assets as indicated on the statement of account. In the case of the First Partner, the payment to her in accordance with this Paragraph shall include a distribution of [set out any assets that are to be distributed to the partner] and the goodwill of the Partnership with the right to continue the Partnership's business as a sole proprietor under the name of [set out name of sole proprietorship]. In the case of the Second Partner, the payment to him in accordance with this Paragraph shall include a distribution of [set out any assets that are to be distributed to the partner]. These distributions are to be at the values set out in Paragraph 5.

7. Arbitration. Any disputes pertaining to the liquidation of the Partnership and the winding up of the Partnership's affairs that cannot be settled amicably between the Partners shall be submitted to an arbitrator under the Rules then obtaining of the American Arbitration Association in the City of [city], whose award may be reduced to judgment in any court of competent jurisdiction.

8. Mutual Releases. Each of the parties releases and discharges the other together with such party's heirs, executors, administrators, and assigns of and from all claims, clauses of action, debts, duties, liabilities, and obligations of any and every sort or nature, wherever and however arising, which against the other he now has or ever had or which he or his heirs, executors, administrators, or assigns hereafter may or can have, from any time up to and including the date of this Agreement.

9. Agreement Binding. This Agreement is binding upon and inures to the benefit of the parties hereto, their heirs, administrators, executors, and assigns.

10. Entire Understanding. This Agreement contains the entire understanding between the parties and supersedes all previous agreements regarding termination and liquidation of the Partnership, whether oral or in writing. This Agreement cannot be modified or terminated except in accordance with its terms or by a writing signed by both parties.

11. Governing Law. This Agreement shall be interpreted in accordance with the laws of the State of [state].

IN WITNESS WHEREOF, the parties have signed this Agreement the day and year first above written.

[signature]

First Partner

[signature]

Second Partner

*** If Required By State Law ***

This Section for Notary:

Acknowledgment

State of _________

County of ________ [County]

On [Date] before me, [Name of Notary], notary, personally appeared [Name of Person(s) Involved], personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

Witness my hand and official seal.

Signature ________
Notary

My commission expires: _____

(Seal)