Partnership Agreement - General (Minnesota)

GENERAL PARTNERSHIP AGREEMENT

STATE OF MINNESOTA

THIS GENERAL PARTNERSHIP AGREEMENT (this "Agreement") is entered into and made effective as of [__/__/____] (the "Effective Date"), by and among the undersigned individuals and/or entities (each, a "Partner" and collectively, the "Partners"):

The Partners hereby form a general partnership (the "Partnership") pursuant to and governed by the Minnesota Revised Uniform Partnership Act of 1994, Minnesota Statutes Chapter 323A, as amended (the "Act"), and upon the terms and conditions set forth herein.

RECITALS

WHEREAS, the Partners desire to associate themselves as a general partnership under the laws of the State of Minnesota for the purposes set forth herein;

WHEREAS, each Partner will make or has made the capital contributions described on Schedule A attached hereto;

WHEREAS, the Partners wish to set forth in writing their respective rights, duties, and obligations with respect to the Partnership and its business; and

WHEREAS, the Partners intend that this Agreement shall govern the internal affairs of the Partnership and, to the extent permitted by the Act, shall supersede the default provisions thereof.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Partners agree as follows:

TABLE OF CONTENTS

1. Definitions
2. Formation; Name; Purpose; Term
3. Capital Contributions; Partnership Interests
4. Allocations; Distributions; Tax Matters
5. Management; Voting; Meetings
6. Representations and Warranties
7. Covenants and Restrictions
8. Books, Records, and Accounting
9. Insurance and Risk Management
10. Indemnification; Limitation of Liability
11. Transfer of Interests; Admission; Withdrawal
12. Dissociation; Dissolution; Winding Up
13. Default and Remedies
14. Dispute Resolution
15. General Provisions
16. Minnesota-Specific Provisions
17. Execution

ARTICLE 1: DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined in the body of this Agreement shall have the meanings assigned to them in the Act.

"AAA" means the American Arbitration Association.

"Act" means the Minnesota Revised Uniform Partnership Act of 1994, Minn. Stat. Ch. 323A, as amended from time to time.

"Adjusted Capital Account" means, with respect to any Partner, such Partner's Capital Account as maintained pursuant to Section 4.1(c), adjusted in accordance with Treasury Regulations Section 1.704-1(b)(2)(ii)(d).

"Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person. For purposes of this definition, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies, whether through ownership of voting securities, by contract, or otherwise.

"Agreement" has the meaning set forth in the preamble.

"Assumed Name Certificate" means the Certificate of Assumed Name filed with the Minnesota Secretary of State pursuant to Minn. Stat. § 333.01 et seq.

"Bankrupt Partner" means a Partner who (a) files a voluntary petition in bankruptcy, (b) becomes the subject of an involuntary petition in bankruptcy that is not dismissed within sixty (60) days, (c) makes a general assignment for the benefit of creditors, or (d) has a receiver or trustee appointed for substantially all of its assets.

"Capital Account" means the capital account maintained for each Partner in accordance with Section 4.1(c) and Treasury Regulations Section 1.704-1(b)(2)(iv).

"Capital Contribution" means, for any Partner, the total amount of cash and the agreed fair market value of property (net of liabilities assumed or to which the property is subject) contributed by such Partner to the Partnership, as set forth on Schedule A, as amended from time to time.

"Code" means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.

"Defaulting Partner" has the meaning set forth in Section 13.1.

"Dissociation" has the meaning set forth in Section 12.1 and as defined in Minn. Stat. § 323A.0601.

"Effective Date" has the meaning set forth in the preamble.

"Fiscal Year" has the meaning set forth in Section 8.1.

"Force Majeure Event" has the meaning set forth in Section 15.10.

"Losses" has the meaning set forth in Section 10.1.

"Majority Interest" means Partners holding more than fifty percent (50%) of the aggregate Percentage Interests.

"Managing Partner" has the meaning set forth in Section 5.5.

"Net Profits" and "Net Losses" mean, for each Fiscal Year or other period, an amount equal to the Partnership's taxable income or loss for such Fiscal Year or period, determined in accordance with Code Section 703(a).

"Non-Defaulting Partner" has the meaning set forth in Section 13.2.

"Partner" and "Partners" have the meanings set forth in the preamble.

"Partnership" has the meaning set forth in the preamble.

"Partnership Interest" means the entire ownership interest of a Partner in the Partnership at any particular time, including the Partner's economic interest, right to participate in management, and all other rights and obligations under this Agreement and the Act.

"Partnership Representative" has the meaning set forth in Section 4.5.

"Percentage Interest" means, for any Partner, the percentage set forth opposite such Partner's name on Schedule A, as amended from time to time in accordance with this Agreement.

"Person" means any individual, corporation, partnership, limited liability company, trust, estate, joint venture, governmental authority, or other entity.

"Statement of Partnership Authority" means the statement filed with the Minnesota Secretary of State pursuant to Minn. Stat. § 323A.0303.

"Supermajority Interest" means Partners holding at least seventy-five percent (75%) of the aggregate Percentage Interests.

"Transfer" means any sale, assignment, transfer, pledge, encumbrance, hypothecation, gift, or other disposition, whether voluntary or involuntary, by operation of law or otherwise.

"Treasury Regulations" means the regulations promulgated under the Code.

ARTICLE 2: FORMATION; NAME; PURPOSE; TERM

2.1 Formation. The Partnership is hereby formed as a general partnership under the laws of the State of Minnesota pursuant to the Act, effective as of the Effective Date. The rights and obligations of the Partners shall be as provided in the Act, except as otherwise expressly provided herein.

2.2 Partnership Name. The Partnership shall conduct its business under the name:

[________________________________]

or such other name as the Partners may unanimously approve from time to time. If the Partnership conducts business under any name other than the surnames of all Partners, the Partnership shall file a Certificate of Assumed Name with the Minnesota Secretary of State in accordance with Minn. Stat. § 333.01 and shall renew such certificate annually as required by Minn. Stat. § 333.055.

2.3 Purpose. The purpose of the Partnership is to:

[________________________________]

and to engage in any and all lawful activities incidental, necessary, or ancillary thereto, as permitted under the Act and the laws of the State of Minnesota.

2.4 Principal Office. The principal office of the Partnership shall be located at:

[________________________________]
[________________________________]
[________________________________]

or at such other place within or outside the State of Minnesota as the Partners may from time to time designate by Majority Interest vote.

2.5 Registered Agent. The Partnership's registered agent for service of process in the State of Minnesota shall be:

Name: [________________________________]
Address: [________________________________]

The registered agent may be changed by Majority Interest vote with appropriate filings with the Minnesota Secretary of State.

2.6 Term. The Partnership shall commence on the Effective Date and shall continue in perpetuity until dissolved and wound up in accordance with Article 12 of this Agreement and the Act.

2.7 Statement of Partnership Authority. The Partners may, but shall not be required to, file a Statement of Partnership Authority with the Minnesota Secretary of State pursuant to Minn. Stat. § 323A.0303 setting forth:

(a) The name and address of the Partnership;
(b) The name and address of each Partner;
(c) The names of Partners authorized to execute instruments transferring real property held in the name of the Partnership; and
(d) Any limitations on the authority of a Partner to enter into transactions on behalf of the Partnership.

//GUIDANCE: A Statement of Partnership Authority, while optional, is strongly recommended. It provides constructive notice of partner authority (especially for real property transactions) and may be filed with the Secretary of State for a $135 filing fee ($155 online/in-person). The statement is effective for five (5) years unless canceled or amended earlier.

2.8 Fictitious Name Registration. If the Partnership operates under an assumed name, the Partnership shall comply with the Minnesota assumed name statutes, Minn. Stat. § 333.01 et seq., including:

(a) Filing a Certificate of Assumed Name with the Secretary of State (filing fee: approximately $30);
(b) Renewing the certificate annually; and
(c) Filing an amended certificate within sixty (60) days of any change in the information contained therein.

ARTICLE 3: CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS

3.1 Initial Capital Contributions. Each Partner shall contribute the Capital Contribution set forth opposite such Partner's name on Schedule A on or before the Effective Date. The form of contribution (cash or property) shall be as specified on Schedule A.

3.2 Valuation of Non-Cash Contributions. The fair market value of any property contributed by a Partner shall be as agreed upon by the Partners and set forth on Schedule A. If the Partners cannot agree on a valuation, they shall engage an independent appraiser, the cost of which shall be borne by the Partnership.

3.3 Additional Capital Contributions.

(a) No Partner shall be required to make additional Capital Contributions beyond those set forth on Schedule A without such Partner's prior written consent.

(b) If the Partners determine that additional capital is needed, additional contributions shall be requested pro rata in accordance with each Partner's Percentage Interest. A Partner who declines to contribute its pro rata share shall have its Percentage Interest adjusted in accordance with a formula approved by Supermajority Interest.

(c) Any additional Capital Contributions shall be reflected in an amended Schedule A.

3.4 No Interest on Capital. No Partner shall be entitled to receive interest on any Capital Contribution.

3.5 Withdrawal of Capital. Except as expressly provided in Article 11 or Article 12 of this Agreement, no Partner may withdraw or demand the return of any part of its Capital Contribution.

3.6 Capital Account Deficit. No Partner shall be required to restore a deficit in its Capital Account upon dissolution or otherwise, except as required by the Act or as otherwise provided herein.

3.7 Partnership Interest Certificates. The Partnership shall not issue certificates representing Partnership Interests unless the Partners unanimously determine otherwise.

ARTICLE 4: ALLOCATIONS; DISTRIBUTIONS; TAX MATTERS

4.1 Allocation of Profits and Losses.

(a) Net Profits. Except as otherwise provided herein, Net Profits for each Fiscal Year shall be allocated to the Partners in proportion to their respective Percentage Interests.

(b) Net Losses. Except as otherwise provided herein, Net Losses for each Fiscal Year shall be allocated to the Partners in proportion to their respective Percentage Interests; provided, however, that Net Losses shall not be allocated to a Partner to the extent that such allocation would create or increase a deficit balance in such Partner's Adjusted Capital Account.

(c) Capital Account Maintenance. The Partnership shall maintain a Capital Account for each Partner in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv). Each Partner's Capital Account shall be (i) increased by such Partner's Capital Contributions and allocations of Net Profits, and (ii) decreased by distributions to such Partner and allocations of Net Losses.

(d) Regulatory Allocations. The Partners intend that the allocations set forth in this Section 4.1 shall have "substantial economic effect" within the meaning of Code Section 704(b) and the Treasury Regulations thereunder. To the extent any allocation is not recognized for federal income tax purposes, the Partners' distributive shares of income, gain, loss, deduction, or credit shall be determined in accordance with their interests in the Partnership as determined under Code Section 704(b) and the applicable Treasury Regulations.

(e) Qualified Income Offset. If a Partner unexpectedly receives an adjustment, allocation, or distribution described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5), or (6), items of Partnership income and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate the deficit balance in such Partner's Capital Account as quickly as possible.

(f) Minimum Gain Chargeback. Notwithstanding any other provision of this Section 4.1, if there is a net decrease in Partnership minimum gain during any Fiscal Year, each Partner shall be allocated items of Partnership income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in accordance with Treasury Regulations Sections 1.704-2(f) and 1.704-2(i)(4).

4.2 Distributions.

(a) Timing. Cash available for distribution shall be distributed to the Partners at such times and in such amounts as determined by Majority Interest vote, but no less frequently than [quarterly / semi-annually / annually].

(b) Order of Distribution. All distributions shall be made to the Partners pro rata in accordance with their respective Percentage Interests, except as otherwise provided in Section 12.3 (distributions upon dissolution).

(c) Tax Distributions. Notwithstanding Section 4.2(a), the Partnership shall use commercially reasonable efforts to distribute to each Partner, at least quarterly, an amount sufficient to enable such Partner to satisfy its estimated federal and Minnesota state income tax obligations arising from Partnership income allocated to such Partner (the "Tax Distribution"). Tax Distributions shall be computed using the highest combined marginal federal and Minnesota individual income tax rate in effect for the applicable tax year.

(d) Limitation on Distributions. No distribution shall be made if, after giving effect thereto, the Partnership would be unable to pay its debts as they become due in the ordinary course of business.

4.3 Tax Elections.

(a) The Partnership shall make such tax elections as the Partners determine by Majority Interest vote, including but not limited to elections under Code Sections 754, 709(b), and 179.

(b) The Partnership may elect to be treated as an entity under the Minnesota Pass-Through Entity (PTE) Tax pursuant to Minn. Stat. § 289A.08 if the election is available and the Partners approve by Majority Interest vote.

4.4 Tax Returns.

(a) The Partnership shall file all required federal, state, and local tax returns, including IRS Form 1065 and Minnesota Form M3 (Partnership Return), on a timely basis.

(b) The Partnership shall furnish to each Partner a completed Schedule K-1 and Minnesota Schedule KPI or KPC (as applicable) within seventy-five (75) days after the end of each Fiscal Year, or as soon thereafter as practicable.

4.5 Partnership Representative.

(a) [________________________________] is hereby designated as the "Partnership Representative" within the meaning of Code Section 6223(a) (as amended by the Bipartisan Budget Act of 2015) for all federal income tax matters.

(b) The Partnership Representative shall have all powers and authority granted under Code Sections 6221 through 6241 and shall keep all Partners informed of any administrative or judicial proceedings regarding Partnership tax matters.

(c) The Partnership Representative may be changed by Supermajority Interest vote.

(d) If the Partnership is eligible, the Partnership Representative may elect to "push out" adjustments to the Partners under Code Section 6226 rather than paying any imputed underpayment at the Partnership level.

ARTICLE 5: MANAGEMENT; VOTING; MEETINGS

5.1 Management Authority. The business and affairs of the Partnership shall be managed collectively by the Partners, each of whom shall have equal rights in the management and conduct of the Partnership's business pursuant to Minn. Stat. § 323A.0401, except as otherwise provided herein.

5.2 Ordinary Course Decisions. Unless otherwise stated herein, any decision or action required in the ordinary course of the Partnership's business shall require the affirmative vote of Partners holding a Majority Interest.

5.3 Major Decisions. The following actions shall require the unanimous written consent of all Partners:

(a) Amendment or modification of this Agreement;
(b) Admission of a new Partner;
(c) Merger, conversion, or reorganization of the Partnership;
(d) Sale, exchange, lease, or other disposition of all or substantially all assets of the Partnership;
(e) Voluntary dissolution of the Partnership;
(f) Any act that would make it impossible to carry on the Partnership's ordinary business;
(g) Confession of a judgment against the Partnership;
(h) Incurrence of indebtedness in excess of $[________________________________];
(i) Execution of any guarantee, indemnity, or surety arrangement;
(j) Commencement or settlement of litigation involving potential liability in excess of $[________________________________]; and
(k) Any transaction between the Partnership and a Partner or an Affiliate of a Partner.

5.4 Meetings.

(a) Regular Meetings. The Partners shall hold regular meetings at least [quarterly / monthly] at the principal office or such other location as the Partners may agree.

(b) Special Meetings. Any Partner may call a special meeting upon at least five (5) business days' prior written notice to all other Partners, specifying the time, place, and purpose of the meeting.

(c) Quorum. Partners holding a Majority Interest, present in person, by telephone, by video conference, or by proxy, shall constitute a quorum for the transaction of business.

(d) Action Without Meeting. Any action required or permitted at a meeting may be taken without a meeting if all Partners consent in writing to the action, which consent may be evidenced by electronic communication.

(e) Minutes. Written minutes of all Partner meetings shall be maintained at the principal office.

5.5 Managing Partner.

(a) The Partners may, by Majority Interest vote, designate one or more Partners as "Managing Partner(s)" to conduct the day-to-day operations of the Partnership.

(b) The initial Managing Partner shall be: [________________________________]

(c) The Managing Partner shall have authority to act on behalf of the Partnership in the ordinary course of business, subject to the limitations set forth in Section 5.3 and any additional limitations established by the Partners.

(d) The Managing Partner may be removed and replaced by Majority Interest vote at any time, with or without cause.

5.6 Compensation of Partners.

(a) No Partner shall receive compensation for services rendered to the Partnership except as approved by Majority Interest vote (excluding the vote of the Partner to whom compensation would be paid).

(b) The Managing Partner shall receive compensation of $[________________________________] per [month / year], or such other amount as the Partners may approve.

(c) All Partners shall be entitled to reimbursement for reasonable out-of-pocket expenses incurred on behalf of the Partnership, subject to appropriate documentation.

5.7 Banking and Financial Authority.

(a) Partnership funds shall be deposited in one or more accounts at financial institutions selected by Majority Interest vote.

(b) Withdrawals and transfers from Partnership accounts shall require the signature of at least [____] Partner(s).

(c) The Managing Partner shall have authority to make expenditures in the ordinary course of business up to $[________________________________] per transaction without further approval.

ARTICLE 6: REPRESENTATIONS AND WARRANTIES

Each Partner hereby represents and warrants to each other Partner and to the Partnership, as of the Effective Date and as of any date on which such Partner acquires an additional Partnership Interest:

6.1 Due Authority. Such Partner has full legal right, power, and authority to execute and deliver this Agreement and to perform all of its obligations hereunder. If such Partner is an entity, it is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization.

6.2 Binding Obligation. This Agreement constitutes the legal, valid, and binding obligation of such Partner, enforceable against such Partner in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' rights generally.

6.3 No Conflict. The execution, delivery, and performance of this Agreement by such Partner does not and will not (a) violate any law, rule, regulation, order, judgment, or decree applicable to such Partner, (b) conflict with or result in a breach of any agreement, instrument, or obligation to which such Partner is a party or by which such Partner is bound, or (c) require any consent, approval, or authorization of any governmental authority or other Person.

6.4 Investment Purpose. Such Partner is acquiring its Partnership Interest for its own account, for investment purposes only, and not with a view to distribution or resale in violation of applicable securities laws.

6.5 Sophistication and Independent Advice. Such Partner (a) is experienced and knowledgeable in business and financial matters, (b) has had the opportunity to consult with independent legal, tax, and financial advisors of its own choosing, and (c) has reviewed and understands the terms of this Agreement and the risks associated with an investment in the Partnership.

6.6 No Litigation. There is no pending or threatened litigation, arbitration, or proceeding that would materially and adversely affect such Partner's ability to perform its obligations under this Agreement.

6.7 Disclosure. Such Partner has not withheld from the other Partners any material fact relating to such Partner's financial condition, legal status, or ability to perform its obligations hereunder.

6.8 Survival. The representations and warranties contained in this Article 6 shall survive the execution of this Agreement and shall continue in full force and effect for the duration of the Partnership.

ARTICLE 7: COVENANTS AND RESTRICTIONS

7.1 Compliance with Laws. The Partnership and each Partner shall comply in all material respects with all applicable federal, state, and local laws, rules, regulations, and ordinances, including without limitation the laws of the State of Minnesota.

7.2 Non-Competition.

(a) IMPORTANT MINNESOTA NON-COMPETE NOTICE: Effective July 1, 2023, Minnesota Statutes Section 181.988 generally prohibits non-compete agreements between employers and employees or independent contractors who perform work in Minnesota, or who reside in Minnesota, at the time the agreement is entered into. Partners are generally not considered "employees" for purposes of this statute; however, the enforceability of non-compete provisions involving partners should be carefully evaluated by Minnesota counsel.

(b) Dissolution Exception. Minn. Stat. § 181.988, subd. 2(2), provides an exception permitting non-compete agreements entered into "upon or in anticipation of a dissolution of, and a separation of ownership interests in, a partnership." This exception is narrowly construed and applies only in the dissolution context.

(c) Non-Compete Covenant (If Applicable). To the extent enforceable under Minnesota law, during the term of the Partnership and for a period of [____] months following a Partner's Dissociation:

☐ Each Partner agrees not to directly or indirectly engage in, own, manage, operate, control, or participate in any business that competes with the Partnership's business within [________________________________] (the "Restricted Area").

☐ This non-compete provision does not apply and is intentionally omitted.

//GUIDANCE: Given Minnesota's non-compete ban (Minn. Stat. § 181.988), consult a Minnesota attorney before including any non-compete restriction. The statute's applicability to partners (as opposed to employees) remains subject to interpretation. If included, ensure the restriction is narrowly tailored to protect legitimate business interests.

7.3 Non-Solicitation. During the term of the Partnership and for a period of [____] months following a Partner's Dissociation, no Partner shall directly or indirectly solicit, hire, recruit, or attempt to hire any employee, independent contractor, customer, client, vendor, or supplier of the Partnership.

7.4 Confidentiality.

(a) Each Partner shall maintain in strict confidence all Confidential Information of the Partnership and shall not disclose such information to any third party without the prior written consent of the other Partners, except as required by law or court order.

(b) "Confidential Information" means all non-public information relating to the Partnership's business, finances, operations, customers, suppliers, trade secrets, and proprietary methods, whether written, oral, or electronic.

(c) The obligations set forth in this Section 7.4 shall survive the dissociation or withdrawal of any Partner and the dissolution and winding up of the Partnership for a period of [____] years.

7.5 Duty of Loyalty. Each Partner owes a duty of loyalty to the Partnership and the other Partners as set forth in Minn. Stat. § 323A.0404, including the duty to (a) account to the Partnership for any property, profit, or benefit derived from Partnership business or use of Partnership property, (b) refrain from dealing with the Partnership on behalf of a party with an adverse interest, and (c) refrain from competing with the Partnership.

7.6 Duty of Care. Each Partner owes a duty of care to the Partnership and the other Partners as set forth in Minn. Stat. § 323A.0404, which is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.

7.7 Good Faith and Fair Dealing. Each Partner shall discharge its duties under this Agreement and the Act consistent with the obligation of good faith and fair dealing as set forth in Minn. Stat. § 323A.0404.

7.8 Notice of Material Matters. Each Partner shall promptly notify the other Partners in writing of (a) any material breach or default under this Agreement, (b) any material adverse change in the Partnership's business, financial condition, or prospects, (c) any pending or threatened litigation, arbitration, or governmental investigation involving the Partnership, and (d) any event that could reasonably be expected to result in the Dissociation of such Partner.

ARTICLE 8: BOOKS, RECORDS, AND ACCOUNTING

8.1 Fiscal Year. The fiscal year of the Partnership (the "Fiscal Year") shall end on [________________________________] of each calendar year, or such other date as the Partners may determine by Majority Interest vote.

8.2 Method of Accounting. The Partnership's books and records shall be maintained on the [cash / accrual] basis of accounting, in accordance with generally accepted accounting principles (GAAP) consistently applied, or such other method as the Partners may approve.

8.3 Books and Records. The Partnership shall maintain at its principal office complete and accurate books and records, including:

(a) A current list of the full name and last known business address of each Partner;
(b) A copy of this Agreement and all amendments thereto;
(c) Copies of the Partnership's federal, state, and local income tax returns for the three (3) most recent Fiscal Years;
(d) Copies of any filed Statement of Partnership Authority and any amendments thereto;
(e) Financial statements for the three (3) most recent Fiscal Years;
(f) Books and records reflecting the Partnership's operations and financial condition;
(g) Minutes of all Partner meetings and written consents; and
(h) A record of all Capital Contributions, distributions, and Capital Account balances.

8.4 Inspection Rights. Each Partner shall have the right, upon reasonable notice during normal business hours, to inspect and copy the Partnership's books and records, at such Partner's expense, as provided in Minn. Stat. § 323A.0403.

8.5 Financial Statements. The Partnership shall prepare and deliver to each Partner:

(a) Annual Statements. Within ninety (90) days after the end of each Fiscal Year, a balance sheet, income statement, and statement of cash flows for such Fiscal Year; and

(b) Quarterly Statements. Within forty-five (45) days after the end of each fiscal quarter, an unaudited summary of Partnership financial activity for such quarter.

8.6 Annual Audit.

☐ The Partners elect to have the Partnership's financial statements audited annually by an independent certified public accountant selected by Majority Interest vote. The cost of such audit shall be borne by the Partnership.

☐ The Partners elect not to require an annual audit at this time but reserve the right to require one by Majority Interest vote.

8.7 Bank Accounts. All Partnership funds shall be deposited in accounts in the Partnership's name at one or more banking or financial institutions selected by the Partners. Withdrawals from Partnership accounts shall require the signature(s) of at least [____] Partner(s) or authorized signatory(ies).

ARTICLE 9: INSURANCE AND RISK MANAGEMENT

9.1 Required Insurance Policies. The Partnership shall obtain and maintain the following insurance policies from financially sound and reputable insurance companies:

(a) Commercial General Liability Insurance with coverage limits of not less than $[________________________________] per occurrence and $[________________________________] in the aggregate;

(b) Professional Liability / Errors and Omissions Insurance (if applicable to the Partnership's business) with coverage limits of not less than $[________________________________] per occurrence;

(c) Property Insurance covering the Partnership's tangible assets at replacement cost;

(d) Workers' Compensation Insurance as required by Minnesota law (Minn. Stat. Ch. 176) if the Partnership has employees;

(e) Commercial Automobile Insurance (if applicable) with coverage limits of not less than $[________________________________] per occurrence; and

(f) Umbrella / Excess Liability Insurance with coverage limits of not less than $[________________________________].

9.2 Additional Insured. Each Partner shall be named as an additional insured on all liability insurance policies maintained by the Partnership, to the extent commercially available.

9.3 Key Person Insurance. The Partners may elect, by Majority Interest vote, to obtain key person life insurance on one or more Partners, with the Partnership as the beneficiary, to fund the purchase of a deceased Partner's Partnership Interest.

9.4 Risk Management. The Partnership shall implement and maintain appropriate risk management policies and procedures consistent with industry standards and prudent business practices.

9.5 Review of Coverage. The Partners shall review insurance coverage at least annually and adjust coverage limits as appropriate.

ARTICLE 10: INDEMNIFICATION; LIMITATION OF LIABILITY

10.1 Mutual Indemnification. Each Partner (the "Indemnifying Partner") shall indemnify, defend, and hold harmless the other Partners, their respective Affiliates, and the Partnership (collectively, the "Indemnified Parties") from and against any and all claims, demands, actions, causes of action, losses, damages, liabilities, costs, and expenses, including reasonable attorneys' fees and court costs (collectively, "Losses"), arising out of or relating to:

(a) Any breach by the Indemnifying Partner of any representation, warranty, covenant, or obligation under this Agreement;
(b) Any act of fraud, gross negligence, or willful misconduct by the Indemnifying Partner in connection with the Partnership's business; or
(c) Any knowing violation of law by the Indemnifying Partner.

10.2 Partnership Indemnification. The Partnership shall indemnify and hold harmless each Partner from and against any Losses incurred by such Partner by reason of being a Partner, to the fullest extent permitted by the Act, provided that such Partner acted in good faith and in a manner such Partner reasonably believed to be in or not opposed to the best interests of the Partnership.

10.3 Advance of Expenses. The Partnership shall advance reasonable expenses incurred by a Partner in defending any action or proceeding in which indemnification may be sought under this Article 10, subject to repayment if it is ultimately determined that such Partner is not entitled to indemnification.

10.4 Limitation of Liability.

(a) No Partner shall be liable to the Partnership or to any other Partner for monetary damages arising from the management of the Partnership's business, except for Losses resulting from (i) fraud, (ii) willful misconduct, (iii) a knowing violation of law, or (iv) a material breach of this Agreement.

(b) In no event shall any Partner be liable for consequential, incidental, special, punitive, or exemplary damages in connection with this Agreement or the Partnership's business, regardless of whether such damages are foreseeable.

(c) The aggregate liability of each Partner under this Agreement shall not exceed:

☐ $[________________________________] (the "Liability Cap")
☐ No cap on liability applies

10.5 Exculpation. No Partner shall be personally liable to the Partnership or to any other Partner for any act or omission performed or omitted in good faith and reasonably believed by such Partner to be within the scope of the authority conferred by this Agreement, except in cases of fraud, willful misconduct, or knowing violation of law.

10.6 Insurance Proceeds. Any indemnification obligations under this Article 10 shall be reduced by the amount of any insurance proceeds actually received by the Indemnified Party with respect to the applicable Loss.

ARTICLE 11: TRANSFER OF INTERESTS; ADMISSION; WITHDRAWAL

11.1 Restrictions on Transfer. No Partner may Transfer all or any portion of its Partnership Interest without:

(a) Compliance with all applicable federal and state securities laws;
(b) The prior written consent of Partners holding at least [____]% of the non-transferring Percentage Interests; and
(c) Delivery to the Partnership of an opinion of counsel, in form and substance reasonably satisfactory to the Partnership, that such Transfer is exempt from registration under applicable securities laws.

11.2 Right of First Refusal.

(a) If a Partner (the "Selling Partner") receives a bona fide written offer from a third party to purchase all or any portion of the Selling Partner's Partnership Interest (the "Offer"), the Selling Partner shall deliver written notice of the Offer to the other Partners (the "ROFR Notice"), which shall include a complete copy of the Offer and all material terms thereof.

(b) Each non-selling Partner shall have thirty (30) days from receipt of the ROFR Notice (the "ROFR Period") to elect to purchase the Selling Partner's Interest (or a pro rata portion thereof) on the same terms and conditions as set forth in the Offer.

(c) If the non-selling Partners do not exercise their right of first refusal within the ROFR Period, the Selling Partner may consummate the Transfer to the third-party offeror on terms no more favorable than those set forth in the Offer, provided such Transfer is completed within ninety (90) days after expiration of the ROFR Period.

11.3 Permitted Transfers. Notwithstanding Section 11.1, a Partner may Transfer its Partnership Interest without the consent of the other Partners to (a) a revocable living trust established by such Partner for estate planning purposes, (b) a family member of such Partner (spouse, child, parent, or sibling), or (c) an entity wholly owned by such Partner; provided, however, that the transferee shall execute a joinder agreement in substantially the form attached as Schedule C and shall be bound by all terms of this Agreement.

11.4 Admission of New Partners. A new Partner may be admitted to the Partnership only upon:

(a) The unanimous written consent of all existing Partners;
(b) Execution by the new Partner of a joinder agreement in substantially the form attached as Schedule C;
(c) Payment by the new Partner of such Capital Contribution as the existing Partners may require; and
(d) Amendment of Schedule A to reflect the new Partner's Capital Contribution and Percentage Interest.

11.5 Voluntary Withdrawal.

(a) A Partner may voluntarily withdraw from the Partnership upon not less than ninety (90) days' prior written notice to all other Partners (the "Withdrawal Notice").

(b) Upon withdrawal, the withdrawing Partner shall be entitled to receive the fair market value of its Partnership Interest, determined as of the date of withdrawal, payable in accordance with Section 11.6.

11.6 Buyout upon Withdrawal or Dissociation.

(a) The purchase price for a withdrawing or dissociated Partner's Interest shall be the fair market value of such Interest as of the date of withdrawal or Dissociation, determined by an independent appraiser mutually agreed upon by the parties, or if the parties cannot agree, by three appraisers (one selected by each party and the third selected by the first two), in accordance with Minn. Stat. § 323A.0701.

(b) The purchase price shall be paid in cash or, at the election of the purchasing Partners, in equal monthly installments over a period not to exceed [____] months, together with interest at the rate of [____]% per annum.

ARTICLE 12: DISSOCIATION; DISSOLUTION; WINDING UP

12.1 Events of Dissociation. A Partner is dissociated from the Partnership upon the occurrence of any of the following events, as provided in Minn. Stat. § 323A.0601:

(a) The Partnership's receipt of notice of the Partner's express will to withdraw;
(b) An event agreed to in this Agreement as causing the Partner's Dissociation;
(c) The Partner's expulsion by unanimous vote of the other Partners if:
(i) It is unlawful to carry on the Partnership's business with that Partner;
(ii) There has been a transfer of all or substantially all of that Partner's transferable interest;
(iii) The Partner is an entity and has filed a certificate of dissolution or equivalent; or
(iv) The Partner is an entity and has been dissolved and its business is being wound up;
(d) Judicial determination of expulsion pursuant to Minn. Stat. § 323A.0601(5);
(e) The Partner's bankruptcy (as defined herein);
(f) Death or adjudication of incapacity of a Partner who is an individual;
(g) Appointment of a guardian or general conservator for the Partner; or
(h) Appointment of a trustee, receiver, or liquidator for the Partner's property.

12.2 Effect of Dissociation. Upon Dissociation:

(a) The dissociated Partner's right to participate in the management and conduct of the Partnership's business terminates;
(b) The dissociated Partner's duty of loyalty under Minn. Stat. § 323A.0404(b)(3) terminates; and
(c) The dissociated Partner's duties of loyalty and care under Minn. Stat. § 323A.0404 continue only with respect to matters arising before the Dissociation.

12.3 Continuation After Dissociation. Unless the Dissociation results in a dissolution under Section 12.4, the Partnership shall continue and the remaining Partners shall purchase the dissociated Partner's Interest in accordance with Section 11.6.

12.4 Dissolution Events. The Partnership shall dissolve upon the first to occur of:

(a) The unanimous written consent of all Partners;
(b) An event making it unlawful for all or substantially all of the Partnership's business to be continued, unless cured within ninety (90) days;
(c) A judicial decree of dissolution under Minn. Stat. § 323A.0801;
(d) The expiration of the term of the Partnership (if a specific term is designated);
(e) The Dissociation of a Partner if, within ninety (90) days after the Dissociation, a Majority Interest of the remaining Partners votes to dissolve; or
(f) Any other event causing dissolution under the Act.

12.5 Statement of Dissolution. Upon dissolution, the Partnership shall file a Statement of Dissolution with the Minnesota Secretary of State in accordance with Minn. Stat. § 323A.1001.

12.6 Winding Up.

(a) Upon dissolution, the Partners (or such Person as the Partners may designate) shall wind up the Partnership's affairs as expeditiously as is consistent with obtaining fair value for Partnership assets.

(b) During winding up, the Partnership may prosecute and defend legal actions, dispose of Partnership property, discharge liabilities, and distribute assets to Partners.

(c) Assets shall be distributed in the following order of priority:
(i) Payment to creditors, including Partners who are creditors, to the extent permitted by law;
(ii) Setting up reserves reasonably necessary for contingent or unforeseen liabilities;
(iii) Return of Capital Contributions to Partners; and
(iv) Distribution of any remaining assets to Partners in proportion to their positive Capital Account balances.

12.7 Final Accounting. Upon completion of winding up, the Partnership shall prepare a final accounting of all Partnership transactions and distributions.

12.8 Termination. The Partnership shall terminate when all assets have been distributed and all filings required to cancel or withdraw the Partnership have been completed.

ARTICLE 13: DEFAULT AND REMEDIES

13.1 Events of Default. A "Default" occurs if a Partner (the "Defaulting Partner"):

(a) Materially breaches any provision of this Agreement and fails to cure such breach within thirty (30) days after receipt of written notice specifying the breach in reasonable detail;

(b) Becomes a Bankrupt Partner;

(c) Engages in fraud, willful misconduct, or criminal conduct relating to the Partnership or its business;

(d) Is convicted of a felony or any crime involving moral turpitude;

(e) Commits an act of gross negligence causing material harm to the Partnership; or

(f) Fails to make a required Capital Contribution within fifteen (15) days after written demand.

13.2 Remedies. Upon the occurrence of a Default by a Defaulting Partner, the non-defaulting Partners (the "Non-Defaulting Partners") may, individually or collectively, pursue any one or more of the following remedies:

(a) Suspension of Rights. Suspend the Defaulting Partner's right to participate in management and voting;

(b) Forced Buyout. Purchase the Defaulting Partner's Partnership Interest at a price equal to [the lesser of / ] the fair market value or book value of such Interest, with a [____]% discount applied to reflect the forced nature of the sale;

(c) Expulsion. Expel the Defaulting Partner from the Partnership by unanimous vote of the Non-Defaulting Partners;

(d) Offset. Offset any amounts owed by the Partnership to the Defaulting Partner against damages caused by the Default;

(e) Specific Performance. Seek specific performance or injunctive relief in any court of competent jurisdiction; and

(f) Other Remedies. Pursue any other remedy available at law or in equity.

13.3 Cumulative Remedies. The remedies set forth in this Article 13 are cumulative and not exclusive of any other remedies available under this Agreement, the Act, or applicable law.

13.4 Attorneys' Fees. In any action or proceeding to enforce this Agreement or arising out of a Default, the prevailing party shall be entitled to recover its reasonable attorneys' fees, costs, and expenses from the non-prevailing party.

ARTICLE 14: DISPUTE RESOLUTION

14.1 Negotiation. The Partners shall first attempt in good faith to resolve any dispute, controversy, or claim arising out of or relating to this Agreement or the Partnership (a "Dispute") by direct negotiation between the Partners or their designated representatives. The negotiation period shall be thirty (30) days from the date a Partner delivers written notice of the Dispute to the other Partners.

14.2 Mediation. If a Dispute is not resolved through negotiation within the period specified in Section 14.1, the Partners shall submit the Dispute to non-binding mediation administered by the AAA (or another mediation service agreed upon by the Partners) before any party may commence arbitration or litigation. The mediation shall take place in [________________________________], Minnesota.

14.3 Mandatory Arbitration. Any Dispute not resolved through negotiation or mediation within sixty (60) days of the initial Dispute notice shall be submitted to final and binding arbitration administered by the AAA under its Commercial Arbitration Rules. The arbitration shall be conducted as follows:

(a) Seat. The seat of arbitration shall be [________________________________], Minnesota.

(b) Arbitrator. The tribunal shall consist of one (1) arbitrator with at least ten (10) years of experience in partnership, commercial, or business disputes and who is admitted to practice law in the State of Minnesota.

(c) Governing Law. The arbitrator shall apply the laws of the State of Minnesota.

(d) Reasoned Award. The arbitrator shall issue a written, reasoned award within sixty (60) days of the close of the arbitration hearing.

(e) Costs. The costs of arbitration (including the arbitrator's fees) shall be borne equally by the parties to the Dispute, unless the arbitrator determines otherwise. Each party shall bear its own attorneys' fees, unless the arbitrator awards attorneys' fees to the prevailing party.

(f) Confidentiality. The arbitration proceedings and any award shall be confidential.

14.4 Injunctive Relief; Exclusive Jurisdiction.

(a) Notwithstanding Sections 14.2 and 14.3, any Partner may seek temporary, preliminary, or permanent injunctive relief, specific performance, or other equitable relief in the state or federal courts located in [________________________________] County, Minnesota (the "Exclusive Jurisdiction Courts"), and each Partner irrevocably submits to the exclusive jurisdiction of such courts for that purpose.

(b) Each Partner waives any objection to venue or forum non conveniens in the Exclusive Jurisdiction Courts.

14.5 Jury Trial Waiver. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTNER HEREBY KNOWINGLY, VOLUNTARILY, AND IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE PARTNERSHIP, OR THE TRANSACTIONS CONTEMPLATED HEREBY.

14.6 Enforcement of Award. Judgment on any arbitral award may be entered in any court of competent jurisdiction under the Minnesota Uniform Arbitration Act, Minn. Stat. Ch. 572B.

ARTICLE 15: GENERAL PROVISIONS

15.1 Amendments. This Agreement may be amended, modified, or supplemented only by a written instrument executed by all Partners.

15.2 Waiver. No failure or delay by any Partner in exercising any right, power, or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege.

15.3 Entire Agreement. This Agreement (including all Schedules and Exhibits attached hereto) constitutes the entire agreement among the Partners with respect to the subject matter hereof and supersedes all prior negotiations, representations, warranties, commitments, offers, contracts, and writings of any nature relating to the Partnership.

15.4 Severability. If any provision of this Agreement is held to be invalid, illegal, or unenforceable by any court of competent jurisdiction, such provision shall be modified and reformed to the minimum extent necessary to make it valid and enforceable, and the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired thereby.

15.5 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Partners and their respective heirs, executors, administrators, personal representatives, successors, and permitted assigns.

15.6 Governing Law. This Agreement and the rights and obligations of the Partners hereunder shall be governed by and construed in accordance with the laws of the State of Minnesota, including the Act, without regard to the conflict of laws principles thereof.

15.7 Notices. All notices, demands, consents, requests, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given:

(a) Upon personal delivery;
(b) One (1) business day after deposit with a nationally recognized overnight courier service, prepaid;
(c) Upon transmission by electronic mail (with confirmation of receipt); or
(d) Three (3) business days after deposit in the United States mail, first class, postage prepaid, certified or registered, return receipt requested;

in each case addressed to the Partner at the address set forth on Schedule A (or such other address as such Partner may designate by written notice).

15.8 Counterparts and Electronic Signatures. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures transmitted by electronic means (including PDF, DocuSign, or similar platforms) shall be deemed original signatures and shall be binding.

15.9 Interpretation.

(a) Headings and captions are for convenience of reference only and shall not affect the construction or interpretation of this Agreement.
(b) "Including" means "including without limitation."
(c) References to Sections, Articles, Schedules, and Exhibits refer to the Sections, Articles, Schedules, and Exhibits of this Agreement unless otherwise specified.
(d) Words in the singular include the plural, and vice versa, as the context requires.

15.10 Force Majeure. Neither the Partnership nor any Partner shall be liable for any delay in or failure of performance caused by events beyond such party's reasonable control, including natural disasters, acts of God, fire, flood, war, terrorism, epidemic, pandemic, governmental actions, labor disputes, or utility failures (each, a "Force Majeure Event"), provided that (a) the affected party gives prompt written notice to the other Partners describing the Force Majeure Event and its expected duration, and (b) the affected party uses commercially reasonable efforts to mitigate the effects of the Force Majeure Event and to resume performance as soon as reasonably practicable.

15.11 No Third-Party Beneficiaries. Except as expressly provided herein, nothing in this Agreement is intended to or shall confer upon any Person other than the Partners any rights, benefits, or remedies of any nature whatsoever.

15.12 Construction. This Agreement shall not be construed more strictly against any Partner by reason of the fact that such Partner or its counsel drafted or prepared this Agreement or any part hereof.

15.13 Confidentiality of Agreement. The terms and conditions of this Agreement are confidential and shall not be disclosed by any Partner to any third party except (a) as required by law or court order, (b) to such Partner's legal, tax, and financial advisors, or (c) as necessary to enforce the terms hereof.

15.14 Relationship of Partners. The Partners are co-owners of a partnership and are not, and shall not be construed to be, employer and employee, principal and agent (except as provided in Minn. Stat. § 323A.0301), joint venturers, or participants in a joint enterprise for any purpose other than as described in this Agreement.

ARTICLE 16: MINNESOTA-SPECIFIC PROVISIONS

16.1 Governing Statute. This Partnership is governed by the Minnesota Revised Uniform Partnership Act of 1994, Minn. Stat. Ch. 323A, as enacted by Laws of Minnesota 1997, ch. 137, and as amended. Minnesota adopted a modified version of the Revised Uniform Partnership Act (RUPA), effective January 1, 1999. To the extent that any provision of this Agreement conflicts with a mandatory provision of the Act, the Act shall control.

16.2 Partner as Agent of Partnership. Pursuant to Minn. Stat. § 323A.0301, each Partner is an agent of the Partnership for the purpose of its business. An act of a Partner, including the signing of an instrument in the Partnership name, for apparently carrying on in the ordinary course the Partnership business or business of the kind carried on by the Partnership binds the Partnership, unless the Partner had no authority to act for the Partnership in the particular matter and the person with whom the Partner was dealing knew or had received notification that the Partner lacked authority.

16.3 Statement of Partnership Authority Filing.

(a) The Partnership may file a Statement of Partnership Authority with the Minnesota Secretary of State pursuant to Minn. Stat. § 323A.0303.

(b) Filing details:

• Filing Office: Minnesota Secretary of State, Business Services Division
• Address: 332 Minnesota Street, Suite N201, Saint Paul, MN 55101
• Phone: (651) 296-2803
• Website: www.sos.mn.gov
• Filing Fee: $135 (mail) / $155 (online or in-person)
• Duration: Effective for five (5) years from the date of filing, unless earlier canceled or amended
• Amendments: May be filed at any time; same filing fee applies
• Cancellation: A Statement of Cancellation may be filed when no longer needed

(c) Effect of filing: A filed Statement of Partnership Authority provides constructive notice of authority or limitations on authority with respect to transfers of real property. For other transactions, third parties are not deemed to know of limitations merely because they are contained in a filed statement, unless they have actual knowledge.

16.4 Assumed Name Requirements.

(a) If the Partnership operates under a name other than the real surnames of all partners, the Partnership must file a Certificate of Assumed Name with the Minnesota Secretary of State pursuant to Minn. Stat. § 333.01.

(b) Filing details:

• Filing Fee: $30
• Renewal: Must be renewed annually by December 31
• Amendments: Must be filed within sixty (60) days of any change in the information

16.5 Minnesota Non-Compete Restrictions (Minn. Stat. § 181.988).

(a) Effective July 1, 2023, Minnesota generally voids and makes unenforceable any covenant not to compete that restricts an employee or independent contractor from performing work after termination.

(b) Exception for Partnership Dissolution: The statute permits non-compete agreements entered into by partners "upon or in anticipation of a dissolution of, and a separation of ownership interests in, a partnership" (Minn. Stat. § 181.988, subd. 2(2)).

(c) Important Limitations:

• The dissolution exception is narrowly construed and does not extend to ordinary partner dissociation;
• Minnesota courts have not yet extensively interpreted the scope of this exception in the partnership context;
• Any non-compete provision in this Agreement should be reviewed by Minnesota counsel to ensure compliance; and
• Non-solicitation and confidentiality provisions are generally not subject to Minn. Stat. § 181.988 and remain enforceable.

(d) Choice-of-Law Prohibition: Minn. Stat. § 181.988, subd. 3, voids any choice-of-law provision in an agreement with an employee or independent contractor that would have the effect of avoiding Minnesota's non-compete restrictions, if the employee or independent contractor primarily resides and works in Minnesota.

16.6 Minnesota Partnership Tax Obligations.

(a) Form M3 (Partnership Return). The Partnership must file Minnesota Form M3 (Partnership Return) if it has taxable Minnesota gross income and is required to file federal Form 1065. Form M3 is due by the 15th day of the 3rd month following the close of the Fiscal Year (March 15 for calendar-year partnerships), with extensions available.

(b) Schedule KPI / KPC. The Partnership must furnish:

• Minnesota Schedule KPI (Partner's Share of Income, Credits, and Modifications) to each nonresident individual partner and each resident individual partner with Minnesota modifications; and
• Minnesota Schedule KPC (Partner's Share of Income, Credits, and Modifications) to each corporate or partnership partner.

(c) Pass-Through Entity (PTE) Tax Election. Pursuant to Minn. Stat. § 289A.08, the Partnership may elect to pay income tax at the entity level on behalf of its partners. Note: The Minnesota PTE tax is scheduled to expire for tax years beginning after December 31, 2025. The Partners should consult with a tax advisor regarding the availability and advisability of this election.

(d) Minnesota Tax Filing Details:

• Agency: Minnesota Department of Revenue
• Address: 600 North Robert Street, Saint Paul, MN 55101
• Phone: (651) 556-3000
• Website: www.revenue.state.mn.us
• Form M3 Due Date: March 15 (calendar year) or 15th day of 3rd month after fiscal year end
• Extension: Automatic 6-month extension available with Form M14

(e) Withholding Requirements. The Partnership may be required to withhold Minnesota income tax on behalf of nonresident partners pursuant to Minn. Stat. § 290.92.

16.7 Minnesota Employment Law Considerations.

(a) If the Partnership employs individuals (as opposed to the Partners themselves), it must comply with all Minnesota employment laws, including but not limited to:

• Minnesota Fair Labor Standards Act (Minn. Stat. Ch. 177);
• Minnesota Human Rights Act (Minn. Stat. Ch. 363A);
• Minnesota Earned Sick and Safe Time (Minn. Stat. § 181.9446, eff. January 1, 2024);
• Minnesota Workers' Compensation Act (Minn. Stat. Ch. 176); and
• Minnesota Unemployment Insurance (Minn. Stat. Ch. 268).

(b) Partners are generally not considered employees of the Partnership for purposes of Minnesota employment law, but this characterization depends on the specific facts and circumstances. The distinction between partner and employee status should be carefully evaluated.

16.8 Real Property Transactions. Pursuant to Minn. Stat. § 323A.0302, Partnership property held in the name of the Partnership may be transferred by an instrument of transfer executed by a Partner in the Partnership name. A filed Statement of Partnership Authority specifying which Partners are authorized to execute instruments transferring real property is strongly recommended for any Partnership that owns or transacts in real property.

16.9 Liability of Partners to Third Parties. Under Minn. Stat. § 323A.0306, all Partners are liable jointly and severally for all obligations of the Partnership unless otherwise agreed by the claimant or provided by law. A claimant must generally exhaust Partnership assets before proceeding against individual Partner assets (Minn. Stat. § 323A.0307).

16.10 Minnesota Data Practices Considerations. If the Partnership contracts with a governmental entity in Minnesota, it may be subject to obligations under the Minnesota Government Data Practices Act (Minn. Stat. Ch. 13) with respect to data created, collected, or maintained in connection with such contracts.

ARTICLE 17: EXECUTION

IN WITNESS WHEREOF, the undersigned Partners have executed this General Partnership Agreement as of the Effective Date first written above, intending to be legally bound hereby.

PARTNER SIGNATURE BLOCKS

PARTNER 1:

Name: [________________________________]
Signature: _____________________________________________
Title (if entity): [________________________________]
Date: [__/__/____]
Address: [________________________________]

PARTNER 2:

Name: [________________________________]
Signature: _____________________________________________
Title (if entity): [________________________________]
Date: [__/__/____]
Address: [________________________________]

PARTNER 3:

Name: [________________________________]
Signature: _____________________________________________
Title (if entity): [________________________________]
Date: [__/__/____]
Address: [________________________________]

PARTNER 4:

Name: [________________________________]
Signature: _____________________________________________
Title (if entity): [________________________________]
Date: [__/__/____]
Address: [________________________________]

NOTARY ACKNOWLEDGMENT

STATE OF MINNESOTA
COUNTY OF [________________________________]

On this [____] day of [________________________________], 20[____], before me, the undersigned Notary Public, personally appeared:

[________________________________]

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.

Notary Public Signature: _____________________________________________
Printed Name: [________________________________]
My Commission Expires: [__/__/____]

[NOTARIAL SEAL]

SCHEDULE A: PARTNERS; CAPITAL CONTRIBUTIONS; PERCENTAGE INTERESTS

Total: $[________________________________] | Total: 100%

Description of Non-Cash Contributions (if applicable):

Partner: [________________________________]
Description of Property: [________________________________]
Agreed Fair Market Value: $[________________________________]
Liabilities Assumed by Partnership: $[________________________________]

SCHEDULE B: MANAGING PARTNER AUTHORITY AND LIMITATIONS

The Managing Partner designated in Section 5.5 shall have the following specific authority and limitations:

Authorized Actions (without further Partner approval):

☐ Execute contracts in the ordinary course of business with a value not exceeding $[________________________________]
☐ Hire and terminate employees with annual compensation not exceeding $[________________________________]
☐ Open and manage bank accounts
☐ File tax returns and make tax elections (other than elections requiring Partner approval)
☐ Engage vendors and service providers in the ordinary course
☐ Other: [________________________________]

Prohibited Actions (requiring Partner approval per Section 5.3):

☐ All Major Decisions listed in Section 5.3
☐ Other: [________________________________]

SCHEDULE C: FORM OF JOINDER AGREEMENT

JOINDER TO GENERAL PARTNERSHIP AGREEMENT

The undersigned (the "New Partner") hereby acknowledges that it has received and reviewed a complete copy of the General Partnership Agreement dated [__/__/____] (the "Agreement") among the Partners of [________________________________] (the "Partnership"), and hereby agrees to be bound by all terms and conditions of the Agreement as though the New Partner were an original signatory thereto.

The New Partner's Capital Contribution, Percentage Interest, and other relevant information are as follows:

Name: [________________________________]
Address: [________________________________]
Capital Contribution: $[________________________________]
Percentage Interest: [____]%

The New Partner hereby makes all representations and warranties set forth in Article 6 of the Agreement as of the date hereof.

NEW PARTNER:

Name: [________________________________]
Signature: _____________________________________________
Date: [__/__/____]

ACKNOWLEDGED AND AGREED BY EXISTING PARTNERS:

Name: [________________________________]
Signature: _____________________________________________
Date: [__/__/____]

Name: [________________________________]
Signature: _____________________________________________
Date: [__/__/____]

SCHEDULE D: DESCRIPTION OF PARTNERSHIP PROPERTY

DISCLAIMER: This template is provided for informational and educational purposes only and does not constitute legal advice. This document must be reviewed, customized, and approved by a qualified attorney licensed in the State of Minnesota before execution. Laws change frequently, and all statutory citations should be verified at the time of use. The use of this template does not create an attorney-client relationship. Neither the template provider nor ezel.ai assumes any liability for the use of this template.

Template prepared for use on ezel.ai legal platform. Last updated: 2026-02-27.
Governed by: Minnesota Revised Uniform Partnership Act, Minn. Stat. Ch. 323A.