(As per Section 23(4) of LLP Act, 2008)
THIS AGREEMENT OF LIMITED LIABILITY PARTNERSHIP (LLP) made at _____________ on ___ Day of _______, YEAR
- _______________ Son of SHRI ___________ Resident of _______________________________which expression shall, unless it be repugnant to the subject or context thereof, include their legal heirs, successors, nominees and permitted assignees and hereinafter called the FIRST PARTY, and
- ______________ Son of SHRI ______________________ Resident of ___________________________________________, which expression shall, unless it be repugnant to the subject or context thereof, include their legal heirs, successors, nominees and permitted assignees and hereinafter called the SECOND PARTY, and
(ALL THE FIRST & SECOND PARTY SHALL BE COLLECTIVELY REFERRED TO AS PARTNERS)
WITNESSES the mutual agreement of the Parties hereto as follows:
THAT PARTNER NAME shall become the Designated Partners on the incorporation of the LLP to carry on partnership business as a Limited Liability Partnership (LLP) registered under the Limited Liability Partnership Act, 2008 (LLP Act) with a view to sharing profit upon the following terms.
In this Agreement unless the context otherwise requires:-
“Accounting Year” means the financial year as defined in the LLP Act, 2008.
“Act” or “LLP Act” means the Limited Liability Partnership Act, 2008.
“Business” includes every trade, profession service, and occupation.
“Change” means a change in the constitution of the body of Partners or Designated Partners other than their admission afresh.
“Designate Partner” means any partner designated as such.
“LLP” means the limited liability partnership formed pursuant to this LLP Agreement.
“LLP Agreement” means this Agreement or any supplement thereof determining the mutual rights and duties of the partners and their rights and duties in relation to the LLP.
“Partner” means any person who becomes a partner in the LLP in accordance with this LLP Agreement.
“She” includes “he” or vice versa.
- NAME: A Limited Liability Partnership shall be carried on in the name and style of LLP COMPANY NAME and hereinafter called as LLP COMPANY NAME.
- ADDRESS: The LLP COMPANY NAME shall have its registered _______________________ and/ or at such other place or places, as shall be agreed to by the majority of the partners from time to time.
- PLACE OF BUSINESS: The Place of business of the LLP shall be the registered office of the Company and it may include any other place or places as may hereinafter be decided by the partners from time to time.
- BUSINESS OBJECTIVE: The business of the LLP COMPANY NAME shall carry on the business of :-
- AS PER MAIN OBJECT
- TERM OF LLP: The Partnership shall commence on the date of registration of the LLP COMPANY NAME, and shall continue to operate thereafter subject to the provisions of the LLP Act, 2008, until termination of this agreement by consent of all Partners for the time being of the LLP. The LLP COMPANY NAME can be wounded up with the consent of all the partners subject to the provisions of the Limited Liability Partnership Act 2008.
LLP COMPANY NAME shall have perpetual succession. Death, retirement or insolvency of any partner shall not dissolve the LLP COMPANY NAME.
- STARTUP CAPITAL OF PARTNERSHIP: The Contribution of the LLP COMPANY NAME shall be Rs………………./- (Rupees only) which shall be contributed by the partners in the following proportions.
First Party: 50 % i.e. Rs.________________/- (Rupees Only)
Second Party: 50 % i.e. Rs.________________/- (Rupees Only)
The further Contribution if any required by the LLP COMPANY NAME shall be brought by the partners in their profit sharing ratio.
- ADOPTION OF THE LLP AGREEMENT: This LLP Agreement along with the LLP’s Certificate of Incorporation should be laid before a special general meeting of the Partners to be held within 30 days of the LLP’s registration for confirmation and adoption. It shall be the responsibility of the first two Designated Partners of the LLP to comply with the same.
- COMMON SEAL: The LLP COMPANY NAME shall have a Common Seal and it shall be laid before and adopted at the general meeting mentioned in (7) above. The Common Seal shall be affixed to any document or contract with approval of and in the presence of at least two of the Designated Partners of the LLP, on each occasion and the same fact recorded chronologically in the Seal Book maintained for the purpose under their signatures.
- ADMISSION OF NEW PARTNER:
- No person may be introduced as a new partner without the written consent of all the existing partners. Such incoming partner shall give his prior consent to act as Partner of the LLP COMPANY NAME.
- The Contribution of the partner may be tangible, intangible, Moveable, or immovable property.
- The Profit-sharing ratio of the incoming partner will be in proportion to his contribution towards LLP COMPANY NAME.
- CESSATION OF EXISTING PARTNERS:
- Partner may cease to be a partner of the LLP COMPANY NAME by giving a notice in writing of not less than fifteen days to the other partners of his intention to resign as a partner.
- No Partners can be expelled by majority partners except in the situation where a partner has been found guilty of carrying any activity I business, which is against the interest or in conflict with the interest of business of LLP COMPANY NAME with a fraudulent purpose
- Partner so ceased under Para 10.2 shall not either individually or in partnership with the other, for the next two years after his cessation, commence or carry on such business in any manner as this LLP might be carrying at the time of his cessation.
- DUTIES OF ALL PARTNERS:
- Every partner shall account to the LLP COMPANY NAME for any benefit derived by him without the consent of the LLP COMPANY NAME from any transaction concerning the LLP COMPANY NAME, or from any use by him of the property, name or any business connection of the LLP COMPANY NAME.
- Every partner shall punctually pay and discharge the separate debts and engagement and indemnify the other partners and the LLP COMPANY NAME assets against the same and all proceedings, costs, claims an demands in respect thereof.
- Every partner shall indemnify the LLP COMPANY NAME and the other existing partner for any loss caused to it by his fraud in the conduct of the business of the LLP COMPANY NAME.
- Every partner shall render true accounts and full information of all things affecting the LLP COMPANY NAME to any partner or his legal representatives.
- Every partner shall give time and attention as may be required for the fulfillment of the objectives of the LLP COMPANY NAME business and they all shall be the working partners. However, No partner shall be entitled to any remuneration unless approved in the Executive meeting of the Designated Partners as hereinafter provided in Para 12.4.
- In case any of the Partners of the LLP COMPANY NAME desires to transfer or assign his interest or shares in the LLP COMPANY NAME he has to offer the same to the remaining partners by giving 7 days’ notice. In the absence of any communication by the remaining partners, the concerned Partner can transfer or assign his shares in the market and the remaining Partners shall accept the New Party unanimously if the said New Party in not in competition with this LLP or detrimental to the interest of this LLP.
- Further, no partner shall without the written consent of the LLP COMPANY NAME–
- Employ any money, goods, property or effects of the LLP COMPANY NAME or pledge, mortgage or create any charge on the asset or properties thereof except in the ordinary course of business and upon the account or for the benefit of the LLP COMPANY NAME.
- Lend money or give credit on behalf of the LLP COMPANY NAME or have any dealings with any persons, company or firm whom the other partner previously in writing has forbidden to trust or deal with. Any loss incurred through any breach of provisions shall be made good to the LLP COMPANY NAME by the partner incurring the same.
- Enter into any bond or becomes surety or security with or for any person or do knowingly cause or suffer to be done anything whereby the LLP COMPANY NAME W2property or any part thereof may be seized.
- Assign, mortgage or charge his or her share” in the LLP COMPANY NAME or any asset or property thereof or make any other person a partner therein.
- Compromise or compound or (except upon payment in full) release or discharge any debt due to the LLP COMPANY NAME except upon the written consent given by the other partner.
- DUTIES OF DESIGNATED PARTNERS:
- The Designated Partners shall be responsible for the doing of all acts, matters and things as are required to be done by the limited liability partnership in respect of compliance of the provisions of this Act including filing of any document, return, statement and the like report pursuant to the provisions of Limited Liability Partnership Act, 2008.
- The Designated Partners shall be responsible for the doing of all acts arising out of this agreement.
- The LLP COMPANY NAME shall pay such remuneration to the Designated Partner as may be decided by the majority of the Partners, for rendering his services as such.
- RIGHTS OF ALL PARTNERS:
- All the Partners of the LLP COMPANY NAME are entitled to share profit and losses in the ratio of their respective contribution in the LLP COMPANY NAME.
- All the partners hereto shall have the rights, title and interest in all the assets and properties in the said LLP COMPANY NAME in the proportion of their contribution at the time of winding up or dissolution.
- Every partner has a right to have access to and to inspect and copy any books of the LLP COMPANY NAME.
- Each of the parties hereto shall be entitled to carry on their own, separate and independent business as hitherto they might be doing or they may hereafter do as they deem fit and proper and other partners and the LLP COMPANY NAME shall have no objection thereto provided that the said partner has intimated the said fact to the LLP COMPANY NAME before the start of the independent business and moreover he shall not uses the name of the LLP COMPANY NAME to carry on the said business.
- On the retirement of a partner, the retiring partner shall be entitled to full payment in respect of all his rights, title and interest in the partner as herein provided. However, upon insolvency of a partner his or her rights, title and interest in the LLP COMPANY NAME shall come to an end. Upon the death of any of the partners herein any one of his or her heirs will be admitted as a partner of the LLP COMPANY NAME in place of such deceased partner. The heirs, executors and administrators of such deceased partners shall be entitled to and shall be paid the full payment in respect of the right, title and interest of such deceased partner.
On the death of any partner, if his or her heir opts not to become the partner, the surviving partners shall have the preferential option to purchase the contribution of the deceased partner in the LLP COMPANY NAME.
- INDEMNIFICATION OF PARTNERS: The LLP COMPANY NAME shall indemnify and defend its partners and other officers from and against any and all liability in connection with claims, actions and proceedings (regardless of the outcome), judgment, loss or settlement thereof, whether civil or criminal, arising out of or resulting from their respective performances as partners and officers of the LLP COMPANY NAME, except for the gross negligence or willful misconduct of the partner or officer seeking indemnification.
- EXTENT OF LIABILITY OF LLP COMPANY NAME: LLP COMPANY NAME is not bound by anything done by a partner in dealing with a person if –
- the partner in fact has no authority to act for the LLP COMPANY NAME in doing a particular act; and
- the person knows that he has no authority or does not know or believe him to be a partner of the LLP COMPANY NAME.
- MANAGEMENT OF LLP & MEETINGS:
- Partners of the LLP other than Designated partners shall be normal Partners as aforementioned in Para 13.5. Their right to participate in the management of the LLP shall be as provided in this Agreement and be decided by a resolution passed by a simple majority vote of the Partners present at a meeting of Partners duly called and held, hereto, which shall require a unanimous decision of all the Partners and shall have one vote each irrespective of their capital contribution to the LLP’s capital. No resolution or decision carried by a majority of Partners shall be valid to be given effect to unless it includes the Partners being the original Parties hereto. The decisions so taken shall be recorded in the minutes within ten days of the general meetings and the same kept at the registered office of the LLP.
- The Designated partners appointed by the LLP shall be responsible both for business management in its entirety and compliance management under the LLP Act and this Agreement. The management of the LLP shall be carried on jointly by the Designated Partners being the original Parties hereto as agreed upon mutually between them by themselves or otherwise so however that they both shall be the first two Designated partners to be named in the Incorporation Document submitted for the LLP’s registration and to be answerable for the doing of all acts, matters and things as are required to be done by the LLP in respect of compliance of the provisions of the LLP Act, 2008 in terms of sections 7,8 and 9 of the said Act. The Partners may appoint more Designated Partners by a 75% majority vote of the Partners present at a meeting of Partners duly called and held at any time and from time to time out of the Partners whose contribution to the capital of the LLP at the material time of appointment is not less than 6% of the total capital contribution as of that date, provided both the Partners being Parties to this Agreement as originally made approve the names proposed. The Designated Partners may by their unanimous decision delegate their powers to any one or more Designated Partners or any top-ranking officers of the LLP as they may consider fit or necessary in the management of the affairs of the LLP at any time or from time to time and similarly withdraw the same.
- Every Partner appointed as a Designated Partner by a majority of the Partners as stated in above shall be entitled to take part in the management of the LLP.
- Any matter or issue relating to the LLP shall be decided by a majority in number of the Designated Partners which shall in every case include the Partners being the original Parties hereto so long as they continue as the designated Partners of the LLP.
- Banking arrangements for the LLP shall be as unanimously decided by the Designated Partners at any time and from time to time, ensuring that all moneys received subject to requirements of current expenses, by way of Cash, Cheques, Drafts or other Pay Orders shall be promptly paid into the LLP’s banking account.
- Each Partner shall render true accounts and full information of all things affecting the LLP to the Designated Partner(s) and on request to any Partner or his legal representative.
- All decisions of the Partners shall be taken at meetings called by a notice in writing or by circular resolutions in cases of urgency. Periodic meeting shall be held as determined by the partners of LLP. Meeting of the partners for any specific purpose may be called at any time by any partner. Meetings in which all Partners are entitled to participate to deliberate and decide by all designated partners shall be called general meetings, and the meetings of the Designated Partners shall be called Executive Meetings. The provisions as are applicable to calling, holding and conducting/adjourning etc., of general meetings and Board meetings and keeping of minutes of such meetings of pure private companies limited by shares under the companies Act, 1956, shall apply respectively to the said two kinds of meetings, excluding the special resolutions, requisitioned resolutions special notices, special business and explanatory statements, requisitioned meetings and default meetings and the related jurisdiction as well as powers of the Court/Tribunal/Central government conferred under the said Act. Every such meeting shall be called by any Designated Partner on the basis of a decision of the Executive Meeting or by circular resolution passed by majority of Designated Partners in any exigency.
- The meeting of the Partners may be called by sending 15 days prior notice to all the partners at their residential address or by mail at the Email ids provided by the individual Partners in written to the LLP COMPANY NAME. In case any partner is a foreign resident the meeting may be conducted by serving 15 days prior notice through email. Provided the meeting be called at shorter notice, if majority of the partners agrees in writing to the same either before or after the meeting.
- A resolution circulated in writing and signed by a majority of the Partners and/or Designated Partners, as the case may be, depending upon whether it is a business to be transacted at a General Meeting or Executive Meeting, including the Partners who are the original Parties to this Agreement in every case, shall be deemed to be duly passed, the date of passing such circular resolution being the date of the signature of the person signing last.
- The meeting of Partners shall ordinarily be held at the registered office of the LLP COMPANY NAME or at any other place as per the convenience of partners.
- The management shall ensure that decisions taken by it are recorded in the minutes within thirty days of taking such decisions and are kept and maintained at the registered office of the LLP COMPANY NAME.
- BOOKS OF ACCOUNTS:
- All funds of the Partnership business shall be deposited in its name in such banking account or accounts as shall be determined by the Designated Partners. All withdrawals are to be made by Cheques signed by the Designated Partners as determined by them.
- All necessary books of account and other papers relating the affairs of the LLP as prescribed under Rule 24 of LLP Rules & Forms, 2008 pursuant to section 34(1) of the LLP Act 2008 shall be ensured by the designated partners for the time being to be kept at the principal place of business of the LLP or at other place or places as mutually agreed upon by all the Partners, and regularly maintained on cash basis or accrual basis and according to double entry system of accounting with all books duly posted with entries arising from day to day up-to-date on any day so as to give a true and fair view of the state of affairs of the LLP. Such books of account shall not be removed from the designated place of business without the consent of all the Partners. Each Partner shall have access and be entitled for taking a copy or an extract of any books of account or related papers of the LLP or folio thereof during the working hours on each working day of the week.
- ACCOUNTING YEAR: The accounting year of the LLP COMPANY NAME shall be from 1st April of the year to 31st March of subsequent year. The first accounting year shall be from the date of commencement of this LLP COMPANY NAME till 31st March of the subsequent year.
- ANNUAL STATEMENTS OF ACCOUNTS AND SOLVENCY: The Designated Partners of the LLP shall, within a period of six months from the end of each accounting year, prepare the Annual Statements of Accounts and Solvency for the financial year as at its last day of all the capital contributions, assets and liabilities and of the profits and losses of the LLP, and the same shall be signed by each Partner in addition in addition to the signing thereof by the Designated partners of the LLP as required under section 34(2) of the Act in token of his being bound thereby. If, in the event, any Partner refuses to sign the Annual Statements of Accounts and Solvency giving no valid reason, a copy of the same shall be posted to him by Registered Post Acknowledgement Due to his last known address as supplied by him to the LLP, and same shall be deemed to have been signed by him on the date of such posting.
- AUDIT: If accounts of the LLP required audit shall be audited in accordance with the provision of section 34(3) of the LLP Act, 2008, and prescribed rules therein. It shall be the responsibility of the Designated Partners of the LLP to comply with Rule 24 of the said Rules in every respect.
- RESERVE FUND: A sum equivalent to 25 (twenty five) per cent per annum or as decided by the designated partners of the net profits arrived at in the audited Annual Statements of Accounts of the LLP shall be transferred and kept in the general reserve fund account. Such reserve fund accumulated shall be utilized for meeting extraordinary losses or expenses or for such other purposes or other long term assets of the LLP in any way as mutually agreed upon by all the partners of the LLP including the Partners being the Parties hereto.
- DIVISION OF THE ANNUAL PROFIT OF THE LLP: As soon as the Annual Statements of Accounts and Solvency shall have been signed by the Partners and the same duly audited and the auditor rendering his report thereon, the net profits, if any, of the LLP business, shall be divided between the Partners in the proportion specified in and in accordance with the provisions of this Agreement.
- PERFORMANCE OF WORK BY PARTNER: If at any time any work for the LLP is to be done under this Agreement or any Supplement thereto by any partner, it may be done by any of his relative or other agent or servant engaged by such Partner competent to do the work on condition that any payment in that behalf shall be to the account of the Partner concerned entailing nothing to be borne by the LLP. Where such a Partner fails to perform such work contracted by him with the LLP, any other Partner may do the same instead or have it done by persons competent to do the work and engaged as his agents additionally to such of the work, if any, contracted by him on his own account with the LLP, at the cost of the LLP. There is nothing contained in this para to enable a Designated partner to assign his responsibility to anyone being an outsider to interfere in the business management of the LLP entrusted to or undertaken by him.
- DESIGNATED PARTNER’S ATTENTION TO BUSINESS: The Partners being the original Parties hereto and other Partners appointed as Designated partners of the LLP shall at all times
- Protect the property and assets of the LLP;
- Devote the whole of their attention to the said partnership business diligently and faithfully by employing themselves in it, and carry on the business for the greatest advantage of the partnership;
- Punctually pay their separate debts to the LLP, if any, duly and indemnify the LLP or other Partners towards charges, expenses or costs incurred to protect the assets of the LLP against any failure to do so; and
- Upon every reasonable request, inform the other Partners of all other Partners of all letters, writings and other things which shall come to their hands or knowledge concerning the business of the LLP.
- NO OF DESIGNATED PARTNER: The maximum number of Designated Partners appointed for the LLP shall be such as mutually agreed upon by the Partners being the original Parties hereto or as decided by the Designated Partners of the LLP unanimously at any time and from time to time not exceeding ten.
- SLEEPING PARTNER: All the Partners other than those appointed as the Designated Partners of the LLP shall be Sleeping Partners, and they shall not interfere with the carrying on the management or conduct of the business of the LLP otherwise than as has been provided in this Agreement and those shall not sign the name of the LLP.
- LLP PARTNER LIABILITY AND INDEMNIFICATION: The liability of a partner or designated partner in relation to the LLP shall be as set out in the Act and in particular every partner shall indemnify the LLP insofar as every partner may take part in its management.
It is a condition of this Agreement that the LLP shall indemnify each partner in respect of payments made and personal liabilities incurred by him:
- in the ordinary and proper conduct of the business of the limited liability partnership; or
- in or about anything necessarily done for the preservation of the business or property of the limited liability partnership.
- PARTNERS & LLP TO RATIFY THIS AGREEMENT TO BE BOUND: This agreement shall become valid to bind the LLP on its incorporation on its being ratified by all of its partners both for themselves and on behalf of the LLP in terms of section 23(3) of the LLP Act, 2008.
- TERMINATION & DISSOLUTION: Any LLP may be Terminated or dissolve voluntarily if the LLP passes a resolution for Termination or dissolution the LLP with approval of at least three-fourths of the total number of its partners. Provided that where the LLP has creditors, whether secured or unsecured, the Termination or dissolution shall not take place unless approval of such creditors takes place in pursuance of rule 7. Notwithstanding any contained in these presents LLP shall be deemed to be terminated in the following case : (i) Number of partners falls below two, (ii) Partner of non economic right is transfer to a third party without the approval of the existing partners
- All the matters not expressly provided in this agreement shall be decided by the consent of all the Partners in writing. Failing that all disputes and questions about and in connection with the LLP under this Agreement arising between the Partners or between any one of them and the legal representative of the Partners or with the LLP at any time and from time to time, shall be settled by conciliation or by arbitration as provided under the Arbitration and Conciliation Act, 1996 as if the parties to the dispute have consented in writing for determination of the same as aforesaid and the provisions of the said Act apply accordingly.
- If any question arises whether the dispute relates to formation, management or business of the LLP, the question shall be referred to the arbitrator, whose decision thereon shall be final.
- ALTERATION or AMENDMENT: No alteration to or amendment or change in this LLP Agreement including any change of business of the LLP in terms of para 8 of the First Schedule to the LLP Act shall be valid unless it is reduced to writing as a Supplement to this Agreement duly accepted by every Partner of the LLP by himself or his legal representative(s), as on the relevant date of alteration, amendment or change.
- ENTIRE AGREEMENT, SEVERRABILITY & WAIVER:
- The forgoing constitutes the entire agreement between the Parties hereto on the subject-matter.
- If any part of this Agreement is held by any Court or authority of competent jurisdiction as void or without effect it shall be limited to that extent and be binding on all parties hereto at the relevant time as a severable part thereof with nothing to affect the rest of this Agreement.
- A failure or a waiver of exercise of any right or power or benefits under this agreement by a Partner or Designated Partner or on their behalf shall not operate as a waiver of the same for ever during the term of this agreement nor any delayed exercise of any right or power or benefit by a Partner or Designated Partner or on their behalf under this Agreement deemed as a waiver
Note: In any resolution relating to the expulsion of a Partner, the principal of natural justice will be followed and in such cases the concerned Partner shall have no right to participate in the meeting, his / her presence shall not be counted the quorum and his/her vote shall not be counted for the said purpose.
IN WITNESS WHEREOF the parties have put their respective hands the day and year first hereinabove written
Signed and delivered by the
For and on behalf of LLP COMPANY NAME
|S.No.||Name of Partners||Signature|