Contracts template

Partnership Deed — Pakistan

PARTNERSHIP DEED

This Deed of Partnership (this "Deed") is made at [CITY], Pakistan on this [DAY] day of [MONTH], [YEAR]

BY AND BETWEEN

1. [PARTNER 1 FULL NAME], son/daughter of [FATHER'S NAME], CNIC No. [CNIC], resident of [ADDRESS] (hereinafter the "First Partner");
2. [PARTNER 2 FULL NAME], son/daughter of [FATHER'S NAME], CNIC No. [CNIC], resident of [ADDRESS] (hereinafter the "Second Partner");
[ADD FURTHER PARTNERS AS REQUIRED]

(the persons named above are hereinafter referred to individually as a "Partner" and collectively as the "Partners").

WHEREAS the Partners have agreed to carry on business in partnership upon the terms and conditions set out below, and wish to record those terms in writing in accordance with the Partnership Act, 1932.

NOW THIS DEED WITNESSETH as follows:

1. NAME OF THE FIRM
1.1 The partnership business shall be carried on under the name and style of "[FIRM NAME]" or such other name as the Partners may unanimously agree (the "Firm").

2. NATURE AND PLACE OF BUSINESS
2.1 The business of the Firm shall be [DESCRIBE BUSINESS] and any other lawful business the Partners may unanimously agree to undertake.
2.2 The principal place of business shall be at [BUSINESS ADDRESS], with such other places as the Partners may agree.

3. COMMENCEMENT AND DURATION
3.1 The partnership shall be deemed to have commenced on [COMMENCEMENT DATE] and shall be a partnership [at will / for a fixed term of [NUMBER] years / for the duration of the venture described above], continuing until determined in accordance with this Deed or the Partnership Act, 1932.

4. CAPITAL
4.1 The initial capital of the Firm shall be PKR [AMOUNT] contributed by the Partners as set out in Schedule 1.
4.2 Further capital, if required, shall be contributed by the Partners in proportion to their profit-sharing ratio or as unanimously agreed.
4.3 [Interest at [RATE]% per annum shall / No interest shall] be payable on the Partners' capital, as agreed in Schedule 1.

5. PROFIT AND LOSS SHARING
5.1 The net profits and losses of the Firm, after providing for all expenses, taxes and permissible deductions, shall be divided among the Partners in the ratio set out in Schedule 1.
5.2 Profits shall be ascertained and distributed [annually / at such intervals as the Partners agree], after retaining such working capital and reserves as the Partners decide.

6. DRAWINGS
6.1 Each Partner may draw against his/her anticipated share of profits such monthly amount as the Partners agree, subject to adjustment on finalisation of accounts. Excess drawings over the actual profit share shall be refunded or carried as a debit.

7. MANAGEMENT AND DUTIES
7.1 [All Partners shall take part in the management of the business / The Firm shall be managed by [MANAGING PARTNER(S)]]. 
7.2 Every Partner shall: (a) be just and faithful to the other Partners; (b) devote [his/her whole time and attention / such time as agreed] to the business; (c) keep proper books of account; and (d) render true accounts and full information of all things affecting the Firm, in accordance with the duties of partners under the Partnership Act, 1932.
7.3 The following matters require the unanimous written consent of all Partners: (a) admitting a new partner; (b) borrowing beyond PKR [AMOUNT]; (c) selling or charging any asset of the Firm above PKR [AMOUNT]; (d) giving any guarantee; (e) compromising or releasing any debt above PKR [AMOUNT]; (f) altering the nature of the business; and (g) any matter materially affecting the Firm.

8. BANKING AND FINANCE
8.1 The Firm shall maintain bank account(s) in the Firm's name, operated by [SIGNATORIES / mode of operation, e.g. jointly by any two Partners].
8.2 All Firm moneys shall be deposited into the Firm's account(s), and the Firm's funds shall be applied only for the purposes of the business.

9. ACCOUNTS AND AUDIT
9.1 The Firm's books of account shall be kept at the principal place of business and shall be open to inspection by every Partner.
9.2 Accounts shall be made up to [ACCOUNTING DATE] each year, and a balance sheet and profit-and-loss account shall be prepared and signed by all Partners. The Partners may appoint an auditor.

10. TAXATION AND REGISTRATION
10.1 The Firm shall obtain a National Tax Number, file its returns and pay its taxes in accordance with the Income Tax Ordinance, 2001 and the Sales Tax Act, 1990 / applicable provincial sales-tax-on-services law, as applicable.
10.2 The Partners shall cause the Firm to be registered with the Registrar of Firms under the Partnership Act, 1932; the Partners acknowledge that an unregistered firm faces the disabilities provided in the Partnership Act, 1932 (including restrictions on enforcing certain claims through the courts).

11. ADMISSION OF A NEW PARTNER
11.1 No person shall be admitted as a partner except with the unanimous written consent of all existing Partners and on such terms as they agree.

12. RETIREMENT OF A PARTNER
12.1 A Partner may retire by giving [NUMBER] months' prior written notice to the other Partners.
12.2 On retirement, the retiring Partner's share shall be ascertained as at the date of retirement and paid as set out in Clause 15, and the continuing Partners may continue the business under the same name. Public notice of retirement shall be given as required by the Partnership Act, 1932.

13. EXPULSION
13.1 A Partner may be expelled only by unanimous decision of the other Partners, exercised in good faith, on grounds of [material/persistent breach of this Deed, fraud, conviction of an offence involving moral turpitude, or conduct prejudicial to the business], after giving the Partner written notice and an opportunity to be heard, consistent with the Partnership Act, 1932.

14. DEATH OR INSOLVENCY OF A PARTNER
14.1 The death or insolvency of a Partner shall not dissolve the Firm as between the remaining Partners, who may continue the business. The share of the deceased/insolvent Partner shall be ascertained and paid to his/her legal heirs/estate as set out in Clause 15, unless the Partners and heirs agree on continued participation.

15. SETTLEMENT OF ACCOUNTS ON RETIREMENT, EXPULSION, DEATH OR DISSOLUTION
15.1 On any Partner ceasing to be a partner, or on dissolution, the accounts shall be settled in accordance with the Partnership Act, 1932: the assets of the Firm (including goodwill, if agreed) shall be applied first in paying the Firm's debts and liabilities to third parties, then in repaying advances and capital to the Partners, and the residue (or deficiency) shall be divided/borne in the profit-sharing ratio.
15.2 The amount due to an outgoing Partner or estate shall be paid [in a lump sum / in [NUMBER] instalments] within [PERIOD], [with/without] interest at [RATE]% per annum.

16. GOODWILL
16.1 The goodwill of the Firm shall be valued [as agreed by the Partners / on the basis of [METHOD]] and shall be treated as an asset of the Firm on settlement of accounts.

17. NON-COMPETE DURING PARTNERSHIP
17.1 No Partner shall, without the consent of the others, carry on any business competing with the Firm or, save for the benefit of the Firm, use the Firm's property, name or business connection for personal gain, consistent with the duties of partners under the Partnership Act, 1932.

18. DISSOLUTION
18.1 The Firm may be dissolved by unanimous agreement of the Partners, or otherwise in the circumstances and manner provided in the Partnership Act, 1932. On dissolution, the affairs shall be wound up and accounts settled as in Clause 15, and public notice shall be given as required by law.

19. DISPUTE RESOLUTION
19.1 Any dispute or difference between the Partners (or between a Partner and the legal heirs of a deceased Partner) arising out of or in connection with this Deed or the business of the Firm shall first be attempted to be resolved amicably, and failing that shall be referred to arbitration by a sole arbitrator appointed by mutual consent under the Arbitration Act, 1940. The seat and venue shall be [CITY] and the award shall be final and binding.

20. GOVERNING LAW AND JURISDICTION
20.1 This Deed is governed by the laws of Pakistan, principally the Partnership Act, 1932 and the Contract Act, 1872. Subject to Clause 19, the courts at [CITY] shall have jurisdiction.

21. GENERAL
21.1 Amendment. This Deed may be varied only by a supplementary deed signed by all Partners.
21.2 Severability. Invalid provisions shall be severed and the remainder shall continue.
21.3 Notices. Notices shall be in writing to the Partners' addresses above.
21.4 Entire Agreement. This Deed records the entire agreement between the Partners and supersedes all prior arrangements.
21.5 The Partnership Act, 1932 shall govern all matters not expressly provided for in this Deed.

SCHEDULE 1 - CAPITAL, INTEREST AND PROFIT-SHARING
| Partner | Capital Contribution (PKR) | Interest on Capital | Profit/Loss Share (%) |
| [Partner 1] | [AMOUNT] | [RATE / Nil] | [%] |
| [Partner 2] | [AMOUNT] | [RATE / Nil] | [%] |
| Total | [AMOUNT] | | 100% |

IN WITNESS WHEREOF the Partners have set their hands to this Deed at [CITY] on the date first above written.

FIRST PARTNER
Signature: ______________________
Name: [NAME]   CNIC: [CNIC]

SECOND PARTNER
Signature: ______________________
Name: [NAME]   CNIC: [CNIC]

WITNESS 1
Signature: ______________________   Name: [NAME]   CNIC: [CNIC]   Address: [ADDRESS]

WITNESS 2
Signature: ______________________   Name: [NAME]   CNIC: [CNIC]   Address: [ADDRESS]