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Partnership Dissolution Agreement Template
What Is a Partnership Dissolution Agreement?
A Partnership Dissolution Agreement is a legal contract that is used when partners want to end their partnership. The purpose of the document is to create a plan for the dissolution of the partnership, that will contain the steps that are supposed to be made in order to break the partnership.
Alternate Name:
- Dissolution of Partnership Agreement.
The agreement is not the final point of ending the partnership, in reality, it is the reverse, it marks the beginning of the process which will separate it. Along with outlining the plan, the Dissolution of Partnership Agreement also provides information on how the partnership assets will be divided, which responsibilities each partner will have during this process, and creates a clear timeline of dissolution events.
Usually, a Partnership Dissolution Agreement is used to end a partnership if the partners did not sign a Partnership Agreement, or if they did not state that the partnership should be separated in any other way. In cases when partners do not want to dissolve their partnership, but one or several of them are willing to leave it, they can use a Notice of Withdrawal From Partnership to notify other partners about their decision. If their shares will be acquired by new partners, the partnership can continue existing, but with the new partners filling the previous partners role.
Download a Partnership Dissolution Agreement PDF through the link below or you can make your own using our online form builder.
How to Write a Partnership Dissolution Agreement?
The agreement is a very complex document with many sections dedicated to different aspects of the process. A Partnership Dissolution Agreement template should contain the following parts:
- Information About the Parties . In the first part of the document, the parties should state their full names and addresses, which are needed for identification purposes. The address should contain a zip code, country, city, street, and building number. If the partners have any management roles, then they should be stated here as well.
- Partnership Information . The agreement should include information about the partnership, such as its legal name, business purpose, location, capital, etc. The purpose of the partnership should briefly describe its main business direction.
- The Subject . Here the parties are supposed to express their intention to dissolve the partnership. They should state that they acknowledge and consent to end the partnership and liquidate and divide its assets.
- Dissolution Plan . Parties use this part of the contract to set a plan for partnership dissolution. The plan can include tasks like completing the holding inventory and setting obligations. The plan should also describe all of the paperwork that has to be done in order to cease the partnership.
- Liquidation . All of the assets that are supposed to be liquidated should be listed here. This part can also state how they will be liquidated, who will be in charge of this process, what is the estimated time period for it.
- Assets Distribution . This is the part where the partners will describe how the remaining asset will be divided and distributed among the partners.
- Signatures . To express their content with everything written in the contract, and state that they are entering the contract fully lucid and under their own free will, the parties should sign the contract. After the document is dated, each partner should keep a copy of it in their records.
Parties can include other sections in the agreement that they have negotiated, such as jurisdiction, severability, representatives, governing law, amendments, indemnification, a non-disclosure clause, etc.
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