Partnership Agreement - General (Pennsylvania)

GENERAL PARTNERSHIP AGREEMENT

COMMONWEALTH OF PENNSYLVANIA

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This General Partnership Agreement (this "Agreement") is entered into as of [__/__/____] (the "Effective Date") by and among the undersigned parties (each, a "Partner" and collectively, the "Partners").

The Partners hereby form a general partnership (the "Partnership") pursuant to and in accordance with the Pennsylvania Uniform Partnership Act of 2016, 15 Pa.C.S. Chapter 84, and upon the terms and conditions set forth herein.

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RECITALS

WHEREAS, the Partners desire to associate themselves as a general partnership 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, obligations, and duties with respect to the Partnership and its operations; and

WHEREAS, the Partners intend this Agreement to constitute the "partnership agreement" as defined in 15 Pa.C.S. § 8412;

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

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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. Pennsylvania-Specific Provisions
17. Execution

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ARTICLE 1. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below.

"AAA" means the American Arbitration Association.

"Act" means the Pennsylvania Uniform Partnership Act of 2016, 15 Pa.C.S. Chapter 84, as amended from time to time.

"Adjusted Capital Account" means, with respect to each Partner, such Partner's Capital Account as adjusted per 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.

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

"Bankruptcy" means, with respect to any Partner, (a) voluntary bankruptcy filing or order for relief; (b) general assignment for the benefit of creditors; (c) appointment of receiver, trustee, or custodian; or (d) involuntary petition not dismissed within sixty (60) days.

"Capital Account" means the account maintained per Section 3.5 and Treasury Regulations Section 1.704-1(b)(2)(iv).

"Capital Contribution" means the total cash and agreed fair market value of property (net of liabilities) contributed by a Partner, as set forth on Schedule A.

"Code" means the Internal Revenue Code of 1986, as amended.

"Commonwealth" means the Commonwealth of Pennsylvania.

"DCED" means the Pennsylvania Department of Community and Economic Development.

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

"Department of State" means the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations.

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

"EIT" means the local earned income tax imposed by Pennsylvania political subdivisions under Act 32.

"Fictitious Name" has the meaning set forth in Section 16.4.

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

"Force Majeure Event" has the meaning set forth in Section 14.8.

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

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

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

"Net Cash Flow" means gross cash receipts less all cash expenditures, excluding Capital Contributions and loan proceeds.

"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, including profit/loss shares, distribution rights, and management rights.

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

"Pa.C.S." means the Pennsylvania Consolidated Statutes.

"Percentage Interest" means the percentage set forth on Schedule A, as amended.

"Person" means any individual, corporation, partnership, LLC, joint venture, trust, estate, unincorporated organization, governmental authority, or other entity.

"PSD Code" means a Political Subdivision Code used by Pennsylvania for local tax administration.

"Statement of Authority" means a statement of partnership authority filed per 15 Pa.C.S. § 8417.

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

"Transfer" has the meaning set forth in Section 11.1.

"Treasury Regulations" means regulations promulgated under the Code.

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ARTICLE 2. FORMATION; NAME; PURPOSE; TERM

2.1 Formation. The Partnership is formed as a general partnership under the Act, effective as of the Effective Date. On and after April 1, 2017, 15 Pa.C.S. Chapter 84 governs all partnerships formed or existing under Pennsylvania law. General partnerships in Pennsylvania are not required to file formation documents with the Department of State to exist; however, the Partners may elect to make certain filings as described herein.

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

[________________________________]

or such other name as the Partners may unanimously approve.

2.3 Fictitious Name Registration. The Partnership shall register its fictitious name (assumed business name) with the Pennsylvania Department of State pursuant to the Fictitious Names Act, 54 Pa.C.S. § 301 et seq. See Section 16.4 for detailed requirements.

2.4 Purpose. The purpose of the Partnership is to:

[________________________________]

and to engage in any lawful activities incidental, necessary, or ancillary thereto.

2.5 Principal Office. The principal office shall be located at:

[________________________________]
[________________________________]
[________________________________]

The Partners may change the principal office by Majority Interest vote.

2.6 Registered Office. The Partnership shall maintain a registered office in Pennsylvania at:

[________________________________]
[________________________________]
[________________________________]

The registered office is the office designated in filings with the Department of State where service of process and other notices may be directed.

2.7 Term. The Partnership shall commence on the Effective Date and continue until dissolved per Article 12 or by operation of law.

2.8 Statement of Partnership Authority. The Partners authorize filing a Statement of Partnership Authority with the Department of State per 15 Pa.C.S. § 8417. The Statement shall include:

(a) The name of the Partnership;

(b) The street address of the chief executive office and, if different, an office in Pennsylvania;

(c) The names and mailing addresses of all Partners or an information agent;

(d) Names of Partners authorized to transfer real property;

(e) Any limitations on Partner authority.

The Statement is canceled by operation of law five (5) years after filing unless renewed.

2.9 Qualification in Other Jurisdictions. If the Partnership operates outside Pennsylvania, it shall comply with all applicable registration requirements.

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ARTICLE 3. CAPITAL CONTRIBUTIONS; PARTNERSHIP INTERESTS

3.1 Initial Capital Contributions. Each Partner shall contribute the Capital Contribution on Schedule A on or before the Effective Date.

3.2 Additional Capital Contributions.

(a) No Partner is required to make additional contributions without written consent.

(b) If additional capital is needed, the Managing Partner shall provide written notice. Each Partner has thirty (30) days to contribute pro rata.

(c) Non-contributing Partners' Percentage Interests shall be adjusted.

3.3 Capital Accounts. Maintained per Treasury Regulations Section 1.704-1(b)(2)(iv):

(a) Credited with contributions, allocable income/gain, and assumed liabilities;

(b) Debited with distributions, allocable losses/deductions, and assumed Partner liabilities.

3.4 Interest on Capital. No interest unless otherwise agreed in writing.

3.5 Withdrawal of Capital. Not permitted except as expressly provided.

3.6 Loans by Partners. Partners may make loans with Majority Interest consent, documented separately.

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ARTICLE 4. ALLOCATIONS; DISTRIBUTIONS; TAX MATTERS

4.1 Allocation of Profits and Losses.

(a) Net Profits. Allocated in proportion to Percentage Interests.

(b) Net Losses. Allocated in proportion to Percentage Interests; no allocation to create or increase a deficit in any Partner's Adjusted Capital Account.

(c) Regulatory Allocations:

(i) Minimum Gain Chargeback per Treas. Reg. § 1.704-2(f);
(ii) Qualified Income Offset per Treas. Reg. § 1.704-1(b)(2)(ii)(d);
(iii) Nonrecourse Deductions allocated per Percentage Interests.

(d) Substantial Economic Effect. All allocations comply with Treas. Reg. § 1.704-1(b).

4.2 Distributions.

(a) Net Cash Flow distributed at times and amounts determined by Majority Interest, not less than [☐ quarterly / ☐ semi-annually / ☐ annually], per Percentage Interests.

(b) Tax Distributions. The Partnership shall distribute not later than [____] days before estimated tax payment dates an amount sufficient to cover each Partner's estimated income tax liability from Partnership operations, calculated at the highest combined federal, Pennsylvania, and local marginal rate.

(c) No distribution if it would render the Partnership unable to pay debts as due.

4.3 Tax Elections.

(a) Calendar year (or other permitted year);

(b) Accrual method (or other permitted method);

(c) Code Section 754 election;

(d) Other elections as the Partnership Representative deems appropriate.

4.4 Tax Returns. The Partnership shall timely file:

(a) Federal Form 1065;

(b) Pennsylvania Form PA-20S/65 (PA S Corporation/Partnership Information Return);

(c) Schedule RK-1 (Resident Partner) and NRK-1 (Nonresident Partner) to each Partner within seventy-five (75) days after Fiscal Year end.

4.5 Partnership Representative. [________________________________] is designated as the "Partnership Representative" under Code Section 6223. The Partnership Representative shall:

(a) Promptly notify all Partners of any audit;

(b) Keep Partners informed;

(c) Not settle without Majority Interest consent;

(d) Elect to push out imputed underpayments under Code Section 6226 if feasible.

4.6 Withholding. The Partnership shall comply with all federal, state, and local withholding requirements, including Pennsylvania withholding for nonresident partners per 72 P.S. § 7324.

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ARTICLE 5. MANAGEMENT; VOTING; MEETINGS

5.1 Management Rights. The Partnership shall be managed collectively by all Partners.

5.2 Voting. Majority Interest required for ordinary decisions. Each Partner votes per Percentage Interest.

5.3 Major Decisions Requiring Unanimous Consent.

(a) Amendment of this Agreement;

(b) Admission of a new Partner;

(c) Sale of all or substantially all assets outside the ordinary course;

(d) Merger, conversion, or reorganization;

(e) Voluntary dissolution;

(f) Incurrence of indebtedness exceeding $[________________________________];

(g) Filing or amendment of Statement of Authority;

(h) Change in business purpose;

(i) Related-party transactions;

(j) Litigation commencement or settlement exceeding $[________________________________].

5.4 Meetings.

(a) Regular Meetings. At least [☐ monthly / ☐ quarterly].

(b) Special Meetings. Five (5) business days' written notice.

(c) Quorum. Majority Interest, present in person, by phone/video, or by proxy.

(d) Minutes. Distributed within ten (10) business days.

(e) Action Without Meeting. Permitted by written consent.

5.5 Managing Partner.

(a) Initial Managing Partner:

[________________________________]

(b) Authority to:

(i) Execute ordinary-course contracts not exceeding $[________________________________];
(ii) Hire and terminate employees and contractors;
(iii) Open and manage bank accounts;
(iv) Make routine expenditures within budgets;
(v) Represent the Partnership.

(c) Serves until resignation, removal by Majority Interest, or dissociation.

5.6 Duty of Care and Loyalty. Each Partner owes duties of care and loyalty per 15 Pa.C.S. § 8443. Duty of care is limited to refraining from grossly negligent or reckless conduct, intentional misconduct, or knowing violation of law.

5.7 Compensation. No compensation except as unanimously approved. Approved compensation treated as guaranteed payment under Code Section 707(c).

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ARTICLE 6. REPRESENTATIONS AND WARRANTIES

Each Partner represents and warrants as of the Effective Date:

6.1 Capacity and Authority. Full legal right, power, and authority to execute and perform. If an entity, duly organized, validly existing, and in good standing.

6.2 No Conflict. Execution and performance do not violate any law, regulation, or agreement.

6.3 Investment Purpose. Acquiring its Partnership Interest for investment, not for resale violating securities laws.

6.4 Sophistication. Financially sophisticated and has consulted independent advisors.

6.5 Financial Capacity. Has financial capacity to meet obligations.

6.6 No Litigation. No pending or threatened litigation that would materially impair performance.

6.7 Compliance. In material compliance with all applicable laws, including Pennsylvania licensing requirements.

6.8 Survival. These representations survive for [____] years, except Sections 6.1 and 6.2 survive indefinitely.

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ARTICLE 7. COVENANTS AND RESTRICTIONS

7.1 Compliance with Law. The Partnership and each Partner shall comply in all material respects with applicable laws.

7.2 Non-Competition.

(a) During the term and for [____] months following dissociation or dissolution, no Partner shall directly or indirectly own, manage, operate, consult for, or be employed by any competitive business within [________________________________] (the "Restricted Territory").

(b) Pennsylvania courts evaluate non-competition covenants for reasonableness in scope, duration, and geography. A non-compete in a partnership context is enforceable if: (i) it is ancillary to a partnership agreement; (ii) the restrictions are reasonably limited in time and geographic scope; (iii) the restrictions serve a legitimate business interest (e.g., protection of goodwill, trade secrets, or customer relationships); and (iv) the restrictions are not unduly burdensome to the restricted Partner.

(c) Pennsylvania courts may apply the "blue-pencil" doctrine to reform overbroad restrictions.

(d) Exclusions. These restrictions do not apply to passive ownership of less than 5% of a publicly traded company or activities approved in writing by other Partners.

7.3 Non-Solicitation. During the term and for [____] months following dissociation, no Partner shall solicit, recruit, or hire any employee, contractor, customer, or supplier of the Partnership.

7.4 Confidentiality.

(a) Each Partner shall keep confidential all Confidential Information, including trade secrets protected under the Pennsylvania Uniform Trade Secrets Act (12 Pa.C.S. § 5301 et seq.).

(b) Exclusions: publicly available, previously known, independently developed, or required by law.

(c) Obligations survive dissociation and dissolution for [____] years.

7.5 Notice of Material Matters. Each Partner shall promptly notify others of material breach, adverse change, litigation, or Bankruptcy.

7.6 Devotion of Time. Each Partner shall devote time reasonably necessary unless specified on Schedule D.

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ARTICLE 8. BOOKS, RECORDS, AND ACCOUNTING

8.1 Fiscal Year. The Fiscal Year ends on [________________________________].

8.2 Books and Records. Maintained at the principal office, including:

(a) Current list of Partners with addresses;

(b) Tax returns for the three most recent Fiscal Years;

(c) This Agreement and all amendments;

(d) Statement of Authority;

(e) Financial statements for the three most recent Fiscal Years;

(f) Meeting minutes and written consents;

(g) Records as required by 15 Pa.C.S. § 8446.

Note: While 15 Pa.C.S. § 8446 does not prescribe specific records that a general partnership must maintain, best practice dictates maintaining the records listed above.

8.3 Accounting Method. [☐ Cash / ☐ Accrual] basis, GAAP.

8.4 Financial Reporting. The Managing Partner or accountant shall prepare:

(a) Monthly or quarterly unaudited statements within thirty (30) days;

(b) Annual financial statements within ninety (90) days;

(c) Additional information upon reasonable request.

8.5 Inspection Rights. Each Partner may inspect and copy books during business hours per 15 Pa.C.S. § 8446.

8.6 Bank Accounts. Deposited in the Partnership's name. Withdrawals require [☐ one / ☐ two] authorized signature(s).

8.7 Independent Accountant. Partners may engage a CPA for annual audit at Partnership expense.

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ARTICLE 9. INSURANCE AND RISK MANAGEMENT

9.1 Required Insurance. The Partnership shall maintain:

(a) Commercial general liability — not less than $[________________________________] per occurrence / $[________________________________] aggregate;

(b) Property insurance covering Partnership property;

(c) Workers' compensation as required by Pennsylvania law (77 P.S. § 1 et seq.);

(d) Professional liability, if applicable — not less than $[________________________________];

(e) Business interruption insurance;

(f) Such other insurance as required by law or deemed advisable.

9.2 Additional Insured. Each Partner named as additional insured where feasible.

9.3 Pennsylvania Workers' Compensation. Under the Pennsylvania Workers' Compensation Act (77 P.S. § 1 et seq.), employers in Pennsylvania must provide workers' compensation coverage. Partners should note that general partners may be considered employees for purposes of workers' compensation depending on the circumstances. The Partnership shall obtain coverage through a licensed carrier or the State Workers' Insurance Fund (SWIF).

9.4 Risk Management. Appropriate risk management policies shall be implemented.

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ARTICLE 10. INDEMNIFICATION; LIMITATION OF LIABILITY

10.1 Mutual Indemnification. Each Partner ("Indemnifying Partner") shall indemnify the other Partners and the Partnership from "Losses" (losses, damages, liabilities, claims, costs, expenses, attorneys' fees) arising from:

(a) Breach of this Agreement;

(b) Grossly negligent, reckless, or intentional misconduct;

(c) Knowing violation of law.

10.2 Notice and Defense. Prompt notice required. Indemnifying Partner has reasonable control of defense.

10.3 Advance of Expenses. Partnership may advance expenses, subject to repayment.

10.4 Limitation of Liability.

(a) No Partner liable for monetary damages except for breach of loyalty, bad faith, intentional misconduct, knowing violation of law, improper personal benefit, or fraud.

(b) Aggregate liability capped at [________________________________] (the "Liability Cap"), except for fraud, willful misconduct, or knowing violation of law.

(c) IN NO EVENT SHALL ANY PARTNER BE LIABLE FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, EXCEPT FOR FRAUD OR WILLFUL MISCONDUCT.

10.5 Exculpation. No liability for good faith reliance on records, expert opinions, or information reasonably believed accurate.

10.6 Insurance. The Partnership may purchase insurance for Partners.

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ARTICLE 11. TRANSFER OF INTERESTS; ADMISSION; WITHDRAWAL

11.1 Restrictions on Transfer. No Partner may Transfer without:

(a) Compliance with securities laws;

(b) Consent of [____]% of non-transferring Percentage Interests;

(c) Satisfactory opinion of counsel.

11.2 Right of First Refusal.

(a) Written notice with copy of third-party offer;

(b) Thirty (30) days to elect pro rata purchase;

(c) If not exercised, Transfer within ninety (90) days on no more favorable terms.

11.3 Buy-Sell Provisions.

(a) Triggering Events: Death/disability, Bankruptcy, material breach, retirement with [____] days' notice.

(b) Valuation: [☐ Mutual agreement / ☐ Independent appraisal / ☐ Formula on Schedule E].

(c) Payment: [☐ In full / ☐ Installments over [____] months at [____]%].

11.4 Admission of New Partners. Unanimous consent and joinder (Schedule C) required.

11.5 Withdrawal.

(a) Ninety (90) days' written notice.

(b) Interest purchased per Section 11.3(b).

(c) Wrongful withdrawal creates liability under 15 Pa.C.S. § 8467.

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ARTICLE 12. DISSOCIATION; DISSOLUTION; WINDING UP

12.1 Dissociation. A Partner is dissociated upon events per 15 Pa.C.S. § 8461, including:

(a) Notice of express will to withdraw;

(b) An event specified in this Agreement;

(c) Expulsion pursuant to this Agreement;

(d) Expulsion by unanimous vote for cause;

(e) Judicial expulsion under 15 Pa.C.S. § 8461(5);

(f) Bankruptcy;

(g) Death, incapacity, or appointment of guardian (if individual);

(h) Termination of entity Partner.

12.2 Effect of Dissociation.

(a) Management rights terminate;

(b) Duties of loyalty and care terminate as to future matters;

(c) Interest purchased per Section 11.3.

12.3 Dissolution Events. The Partnership dissolves upon:

(a) Unanimous written agreement;

(b) An event making it unlawful to continue;

(c) Judicial determination under 15 Pa.C.S. § 8481;

(d) Dissociation resulting in dissolution under 15 Pa.C.S. § 8481, unless within ninety (90) days a majority in interest agrees to continue;

(e) Disposition of substantially all assets.

12.4 Winding Up. Upon dissolution:

(a) Non-wrongfully-dissociating Partners wind up per 15 Pa.C.S. § 8483;

(b) The Partnership continues for winding up only;

(c) Each Partner cooperates;

(d) File a statement of dissolution with the Department of State per 15 Pa.C.S. § 8419.

12.5 Distribution Upon Liquidation.

(a) Pay creditors (including Partner-creditors);

(b) Reserves for contingent liabilities;

(c) Return Capital Contributions;

(d) Distribute per positive Capital Account balances.

12.6 Deficit Capital Account. No Partner must restore a deficit unless required by law.

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ARTICLE 13. DEFAULT AND REMEDIES

13.1 Events of Default. A "Default" by a Partner ("Defaulting Partner") occurs upon:

(a) Material breach not cured within thirty (30) days;

(b) Bankruptcy;

(c) Fraud, embezzlement, or criminal conduct;

(d) Knowing violation of law materially adversely affecting the Partnership;

(e) Failure to make Capital Contribution within fifteen (15) days of demand.

13.2 Remedies. Non-Defaulting Partners may:

(a) Suspend voting and management rights;

(b) Purchase interest at lesser of FMV or book value, less damages;

(c) Offset amounts against distributions;

(d) Seek specific performance, injunctive relief, or other remedies;

(e) Expel the Defaulting Partner.

13.3 Cumulative Remedies. Remedies are cumulative and not exclusive.

13.4 Attorneys' Fees. The prevailing party is entitled to reasonable attorneys' fees and costs.

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ARTICLE 14. DISPUTE RESOLUTION

14.1 Negotiation. Good faith negotiation upon written notice.

14.2 Mediation. If unresolved within thirty (30) days, non-binding AAA mediation in [________________________________], Pennsylvania. Costs shared equally.

14.3 Mandatory Arbitration. If unresolved within sixty (60) days of mediation, binding AAA Commercial Arbitration:

(a) Seat: [________________________________], Pennsylvania;

(b) One (1) arbitrator (three (3) if exceeding $[________________________________]) with ten (10) years' experience;

(c) Reasoned award within sixty (60) days;

(d) Final and binding; judgment in any Pennsylvania court.

14.4 Injunctive Relief. Any Partner may seek injunctive relief in the Court of Common Pleas of [________________________________] County, Pennsylvania, or the United States District Court for the [☐ Eastern / ☐ Middle / ☐ Western] District of Pennsylvania.

14.5 Governing Law. This Agreement is governed by the laws of the Commonwealth of Pennsylvania, including the Act, without regard to conflict of laws.

14.6 Jury Trial Waiver. TO THE FULLEST EXTENT PERMITTED BY PENNSYLVANIA LAW, EACH PARTNER WAIVES ANY RIGHT TO A JURY TRIAL IN ANY PROCEEDING RELATING TO THIS AGREEMENT.

14.7 Confidentiality. All mediation and arbitration proceedings are confidential.

14.8 Force Majeure. No Partner is liable for delay or failure caused by Force Majeure Events (natural disasters, war, terrorism, pandemics, governmental actions, labor disputes), provided prompt notice and commercially reasonable mitigation efforts.

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ARTICLE 15. GENERAL PROVISIONS

15.1 Amendments. Amendment requires written instrument by all Partners.

15.2 Waiver. No failure or delay operates as a waiver.

15.3 Entire Agreement. This Agreement and Schedules constitute the entire agreement.

15.4 Severability. Invalid provisions reformed; remainder continues.

15.5 Successors and Assigns. Binding on Partners and permitted successors.

15.6 Notices. Written notices deemed given upon:

(a) Personal delivery;

(b) One (1) business day after overnight courier;

(c) Three (3) business days after certified mail;

(d) Confirmed email (with copy by another method);

addressed to the Partner at the address on Schedule A.

15.7 Counterparts; Electronic Signatures. Executed in counterparts. Electronic signatures binding under the Pennsylvania Uniform Electronic Transactions Act (73 Pa.C.S. § 2260.101 et seq.).

15.8 Interpretation. Headings for convenience. "Including" means "including without limitation."

15.9 No Third-Party Beneficiaries. No Person other than Partners and permitted successors has rights hereunder.

15.10 Further Assurances. Each Partner shall execute further documents as reasonably necessary.

15.11 Creditors. No provision benefits creditors except as required by law.

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ARTICLE 16. PENNSYLVANIA-SPECIFIC PROVISIONS

16.1 Governing Statute. This Partnership is governed by the Pennsylvania Uniform Partnership Act of 2016, 15 Pa.C.S. Chapter 84. This chapter became effective April 1, 2017, and governs all partnerships formed or existing in the Commonwealth. The 2016 Act replaced the prior Pennsylvania Uniform Partnership Act (1994) previously codified in 15 Pa.C.S. Chapter 84. To the extent this Agreement conflicts with a non-waivable provision of the Act, the statutory provision controls per 15 Pa.C.S. § 8415.

16.2 Non-Waivable Provisions. Under 15 Pa.C.S. § 8415, the partnership agreement may not:

(a) Vary the rights and duties under § 8415;

(b) Unreasonably restrict access to books and records under § 8446;

(c) Eliminate the duty of loyalty, though specific exceptions may be identified if not manifestly unreasonable;

(d) Unreasonably reduce the duty of care;

(e) Eliminate the obligation of good faith and fair dealing;

(f) Vary the power to dissociate except to require up to 180 days' notice;

(g) Vary the right of judicial expulsion;

(h) Vary the winding up requirement;

(i) Restrict third-party rights.

16.3 Statement of Partnership Authority Filing.

(a) Filing. The Partnership may file a Statement of Partnership Authority with the Pennsylvania Department of State, Bureau of Corporations and Charitable Organizations, per 15 Pa.C.S. § 8417.

(b) Filing Fee. The fee for filing is $125.00 (as of 2026; verify current fee).

(c) Duration. Canceled by operation of law five (5) years after filing or most recent amendment.

(d) Real Property. If the Partnership holds real property in Pennsylvania, a certified copy of the Statement shall be recorded in the recorder of deeds office in each county where the property is located.

(e) Contact Information:
Pennsylvania Department of State
Bureau of Corporations and Charitable Organizations
401 North Street, Room 206
Harrisburg, Pennsylvania 17120
Telephone: (717) 787-1057
Website: www.dos.pa.gov/BusinessCharities

16.4 Fictitious Name Registration — CRITICAL PENNSYLVANIA REQUIREMENT.

(a) Mandatory Registration. Under the Fictitious Names Act, 54 Pa.C.S. § 301 et seq., any entity (including a general partnership) conducting business in Pennsylvania under an assumed or fictitious name must register the fictitious name by filing an Application for Registration of Fictitious Name (Form DSCB:54-311) with the Department of State.

(b) Filing Fee. The filing fee is $70.00 (as of 2026; verify current fee).

(c) Required Information. The application must include:

(i) The fictitious name to be registered;
(ii) A brief statement of the character or nature of the business;
(iii) The address of the principal place of business;
(iv) The name, address, and form of organization of each entity that is a party to the registration;
(v) For each entity partner, the jurisdiction of organization.

(d) Publication Requirement. If any partner is an individual, the Partnership must publish notice of the filing in (i) a newspaper of general circulation and (ii) the legal journal (if any) designated by the rules of court for the publication of legal notices in the county where the principal office is located. The notice must state:

(i) The address of the principal office;
(ii) The names and addresses of all parties to the registration;
(iii) A statement that the fictitious name application has been or will be filed.

(e) Penalty for Non-Compliance. Failure to register a fictitious name bars the Partnership from using Pennsylvania courts to enforce contracts entered into under the unregistered fictitious name. This is a significant penalty that can impair the Partnership's ability to collect debts, enforce agreements, and protect its rights.

(f) Decennial Renewal. The fictitious name registration must be renewed every ten (10) years.

16.5 Pennsylvania Tax Matters.

(a) Pennsylvania Personal Income Tax (PIT) — Pass-Through Treatment. Pennsylvania does not impose an entity-level income tax on general partnerships. Partnership income passes through to Partners and is taxed at the Pennsylvania flat individual income tax rate.

Tax	Rate
Pennsylvania Personal Income Tax (PIT)	3.07% (flat rate, as of 2026)

Partnership income is classified into one of eight (8) classes of income under Pennsylvania law: (1) compensation; (2) net profits; (3) interest; (4) dividends; (5) rents and royalties; (6) gains from disposition of property; (7) gambling and lottery winnings; (8) income from estates and trusts. Partners must classify their distributive shares accordingly.

(b) Local Earned Income Tax (EIT). One of Pennsylvania's most distinctive tax features is the local earned income tax imposed by municipalities and school districts under Act 32 (53 P.S. § 6924.101 et seq.). Key points:

(i) Pass-Through Net Profits. Partnership net profits passed through to resident partners are generally subject to local EIT as "net profits" earned by the individual partner;

(ii) Rate. EIT rates vary by municipality and school district. The combined rate typically ranges from 1% to 3.2% (resident rate);

(iii) PSD Codes. Each political subdivision has a unique PSD Code used for EIT administration. Partners must determine the correct PSD Code for both their residence and workplace locations;

(iv) Filing. Partners file local EIT returns with the tax collection officer designated for their political subdivision. DCED maintains a list of PSD Codes and tax rates;

(v) Apportionment. If the Partnership operates in multiple municipalities, net profits may need to be apportioned among jurisdictions;

(vi) Local Services Tax (LST). Municipalities may also impose an LST on persons employed in the municipality (up to $52 per year).

(c) Pennsylvania Sales Tax. If the Partnership sells taxable goods or services, it must:

(i) Register for a Sales Tax License with the Pennsylvania Department of Revenue;

(ii) Collect and remit sales tax at the state rate of 6%, plus 1% local tax in Allegheny County and 2% local tax in Philadelphia (for an effective rate of 7% or 8%);

(iii) File returns per the schedule prescribed by the Department of Revenue.

(d) Withholding for Nonresident Partners. The Partnership shall withhold Pennsylvania PIT on distributive shares to nonresident partners per 72 P.S. § 7324.

(e) Capital Stock / Franchise Tax. Pennsylvania phased out its capital stock and franchise tax effective January 1, 2016. General partnerships are not subject to this tax.

(f) Net Profits Tax (Philadelphia). If the Partnership conducts business in the City of Philadelphia, it may be subject to the Philadelphia Net Profits Tax (NPT) and the Philadelphia Business Income and Receipts Tax (BIRT), in addition to the state-level taxes. Partners should consult with a Philadelphia tax specialist.

16.6 Pennsylvania No-Formation-Filing Requirement. Unlike corporations and LLCs, a general partnership in Pennsylvania is not required to file formation documents with the Department of State. The partnership exists by operation of law when two or more persons associate to carry on a business for profit. However, the Partnership is strongly encouraged to:

(a) File a Statement of Partnership Authority (Section 16.3);

(b) Register its fictitious name (Section 16.4);

(c) Obtain an EIN from the IRS;

(d) Register with the Pennsylvania Department of Revenue;

(e) Obtain all required local business licenses and permits.

16.7 Joint and Several Liability. Under 15 Pa.C.S. § 8436, Partners are jointly and severally liable for all Partnership obligations. This means each Partner's personal assets are at risk for Partnership debts and liabilities. Partners should carefully consider whether conversion to an LLP or LLC is appropriate.

16.8 Conversion to LLP. The Partners may convert to a Limited Liability Partnership by filing a Statement of Qualification with the Department of State per 15 Pa.C.S. § 8491 et seq. An LLP provides Partners with protection from personal liability for obligations arising from the negligence or misconduct of other Partners.

16.9 Pennsylvania Department of State Filing Reference.

Filing	Fee	Frequency	Statute
Statement of Partnership Authority	$125.00	Initial; renew every 5 years	15 Pa.C.S. § 8417
Amendment of Statement	$125.00	As needed	15 Pa.C.S. § 8417
Statement of Dissolution	$125.00	Upon dissolution	15 Pa.C.S. § 8419
Fictitious Name Registration	$70.00	Initial; renew every 10 years	54 Pa.C.S. § 311
Statement of Qualification (LLP)	$125.00	Initial; renew annually	15 Pa.C.S. § 8491
Statement of Merger	$125.00	Upon merger	15 Pa.C.S. § 8488

Note: Fees subject to change. Verify at www.dos.pa.gov or (717) 787-1057.

16.10 Pennsylvania Courts. Pennsylvania has a unified judicial system with three (3) federal judicial districts:

(a) United States District Court for the Eastern District of Pennsylvania (Philadelphia);

(b) United States District Court for the Middle District of Pennsylvania (Harrisburg, Scranton, Williamsport);

(c) United States District Court for the Western District of Pennsylvania (Pittsburgh, Erie, Johnstown).

The Court of Common Pleas in each county is the trial court of general jurisdiction for state law matters.

16.11 Pennsylvania Fictitious Name Compliance Checklist.

☐ Determined that the Partnership name is a "fictitious name" requiring registration (any name other than the real names of all partners)

☐ Searched the Department of State database to confirm name availability

☐ Completed Form DSCB:54-311 (Application for Registration of Fictitious Name)

☐ Paid filing fee of $70.00

☐ Published notice in newspaper of general circulation in the county of principal office (if any individual partner)

☐ Published notice in legal journal of the county of principal office (if any individual partner)

☐ Retained proof of publication with Partnership records

☐ Calendared decennial renewal date

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ARTICLE 17. EXECUTION

IN WITNESS WHEREOF, the undersigned Partners have executed this General Partnership Agreement as of the Effective Date.

PARTNER SIGNATURE BLOCKS

PARTNER 1:

Name: [________________________________]

☐ Individual ☐ Entity

If Entity — Entity Name: [________________________________]
Jurisdiction: [________________________________]
Title: [________________________________]

Signature: _______________________________________________

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

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PARTNER 2:

Name: [________________________________]

☐ Individual ☐ Entity

If Entity — Entity Name: [________________________________]
Jurisdiction: [________________________________]
Title: [________________________________]

Signature: _______________________________________________

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

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PARTNER 3 (if applicable):

Name: [________________________________]

☐ Individual ☐ Entity

If Entity — Entity Name: [________________________________]
Jurisdiction: [________________________________]
Title: [________________________________]

Signature: _______________________________________________

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

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NOTARY ACKNOWLEDGMENT

COMMONWEALTH OF PENNSYLVANIA
COUNTY OF [________________________________]

Before me, the undersigned notary public, on this [____] day of [________________________________], 20[____], 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: [__/__/____]

Notary Seal Number: [________________________________]

[NOTARY SEAL]

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SCHEDULE A — PARTNERS; CAPITAL CONTRIBUTIONS; PERCENTAGE INTERESTS

Partner Name	Address (with PSD Code)	Initial Capital Contribution	Form of Contribution	Percentage Interest
[________________________________]	[________________________________] PSD: [______]	$[________________________________]	☐ Cash ☐ Property ☐ Services ☐ Note	[____]%
[________________________________]	[________________________________] PSD: [______]	$[________________________________]	☐ Cash ☐ Property ☐ Services ☐ Note	[____]%
[________________________________]	[________________________________] PSD: [______]	$[________________________________]	☐ Cash ☐ Property ☐ Services ☐ Note	[____]%

Total Percentage Interests: 100%

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SCHEDULE B — PENNSYLVANIA TAX COMPLIANCE CHECKLIST

☐ Federal EIN obtained

☐ Pennsylvania Enterprise Registration completed (PA-100) with Department of Revenue

☐ Fictitious name registered with Department of State (Form DSCB:54-311)

☐ Publication of fictitious name notice completed (if applicable)

☐ PA Form PA-20S/65 filing requirement confirmed

☐ Schedule RK-1 / NRK-1 distribution procedures established

☐ Local EIT obligations identified — PSD Codes determined for all Partners and business locations

☐ Local EIT tax collector(s) identified for Partnership location(s)

☐ Pennsylvania Sales Tax License obtained (if applicable)

☐ Nonresident partner withholding procedures established (72 P.S. § 7324)

☐ Philadelphia BIRT / NPT obligations reviewed (if applicable)

☐ Workers' compensation coverage obtained (if employees)

☐ Local business license(s) obtained

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SCHEDULE C — FORM OF JOINDER AGREEMENT

The undersigned agrees to become a Partner and be bound by the General Partnership Agreement dated [__/__/____], as amended.

New Partner Information:

Name: [________________________________]
Address (with PSD Code): [________________________________]
Capital Contribution: $[________________________________]
Percentage Interest: [____]%
Effective Date: [__/__/____]

Signature: _______________________________________________
Date: [__/__/____]

Acknowledged by Existing Partners:

Partner Name	Signature	Date
[________________________________]	___________________________	[__/__/____]
[________________________________]	___________________________	[__/__/____]

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SCHEDULE D — PARTNER DUTIES AND COMPENSATION

Partner Name	Role/Title	Time Commitment	Compensation	Guaranteed Payment
[________________________________]	[________________________________]	☐ Full-time ☐ Part-time ☐ As needed	$[________________________________] per [____]	☐ Yes ☐ No
[________________________________]	[________________________________]	☐ Full-time ☐ Part-time ☐ As needed	$[________________________________] per [____]	☐ Yes ☐ No

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SCHEDULE E — VALUATION METHODOLOGY

☐ Option 1: Agreed Value. Partners attempt to agree within thirty (30) days.

☐ Option 2: Independent Appraisal. Each side selects one appraiser; the two select a third. Average (or median if >20% divergence) controls. Costs shared equally.

☐ Option 3: Formula. FMV = [____] x average net income for [____] years + book value of assets - liabilities.

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DISCLAIMER: This template is provided for informational purposes only and does not constitute legal advice. This template must be reviewed and customized by a qualified attorney licensed in the Commonwealth of Pennsylvania before execution. Pennsylvania's fictitious name registration requirement is mandatory and failure to comply can bar the Partnership from enforcing contracts in Pennsylvania courts. Local earned income tax obligations vary significantly by municipality. Laws and filing requirements change frequently. Do not use this template without professional legal review. No attorney-client relationship is created by use of this template.

Prepared for use on the ezel.ai platform. Last updated: 2026-02-27.