Partnership Agreement - General (Tennessee)

GENERAL PARTNERSHIP AGREEMENT

STATE OF TENNESSEE

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"):

Partner A: [________________________________] (Full Legal Name), a resident of [________________________________] County, Tennessee / a [________________________________] (entity type) organized under the laws of [____]

Partner B: [________________________________] (Full Legal Name), a resident of [________________________________] County, Tennessee / a [________________________________] (entity type) organized under the laws of [____]

Partner C (if applicable): [________________________________] (Full Legal Name), a resident of [________________________________] County, Tennessee / a [________________________________] (entity type) organized under the laws of [____]

The Partners hereby form a general partnership (the "Partnership") pursuant to and governed by the Tennessee Revised Uniform Partnership Act, Tenn. Code Ann. Section 61-1-101 et seq. (the "Act"), and upon the following terms and conditions.

RECITALS

A. The Partners desire to associate themselves as partners in a general partnership for the purposes described herein;

B. Each Partner will make or has made the capital contributions described on Schedule A attached hereto;

C. The Partners wish to set forth their respective rights, obligations, and duties with respect to the Partnership;

D. The Partners intend that this Partnership shall be governed by the Tennessee Revised Uniform Partnership Act (Tenn. Code Ann. Section 61-1-101 et seq.), which is Tennessee's adoption of the Revised Uniform Partnership Act (RUPA);

E. The Partners acknowledge that Tennessee franchise and excise tax treatment depends on the Partnership's legal form, liability characteristics, registration, ownership, activities, nexus, and any properly claimed exemption, and that separate Tennessee business-tax obligations may apply; and

F. The Partners have had the opportunity to seek independent legal and tax counsel regarding this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants herein and other good and valuable consideration, 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. Tennessee-Specific Provisions
17. Execution and Signature Blocks

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 Tennessee Revised Uniform Partnership Act, Tenn. Code Ann. Section 61-1-101 et seq., as amended.

"Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such Person.

"Agreement" means this General Partnership Agreement, including all Schedules and Exhibits, as amended.

"Bankruptcy" means, with respect to any Partner, (i) the filing of a voluntary petition or the entry of an order for relief under the United States Bankruptcy Code, (ii) the making of a general assignment for the benefit of creditors, (iii) the appointment of a receiver, custodian, or trustee for all or substantially all assets, or (iv) any similar proceeding.

"Business Tax" means the Tennessee business tax imposed under Tenn. Code Ann. Section 67-4-701 et seq., applicable to businesses with sufficient gross receipts.

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

"Capital Contribution" means the total amount of cash and the 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.

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

"Dissociation" has the meaning set forth in Tenn. Code Ann. Section 61-1-601 and Section 12.1.

"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.

"Franchise and Excise Tax" means the Tennessee franchise tax and excise tax imposed under Tenn. Code Ann. Section 67-4-2004 et seq.

"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.

"Net Cash Flow" means gross cash receipts of the Partnership less cash expenditures, debt service, and reasonable reserves.

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

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

"Partnership Interest" means a Partner's entire interest in the Partnership, including rights to distributions, allocations, and management participation.

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

"Percentage Interest" means the percentage set forth opposite each Partner's name on Schedule A.

"Person" means any individual, corporation, partnership, LLC, trust, estate, association, or other entity.

"Profits" and "Losses" mean the Partnership's taxable income or loss for each Fiscal Year as determined under Code Section 703(a), with appropriate adjustments.

"Secretary of State" means the Tennessee Secretary of State.

"Statement" means a statement of partnership authority under Tenn. Code Ann. Section 61-1-303, a statement of denial under Tenn. Code Ann. Section 61-1-304, a statement of dissociation under Tenn. Code Ann. Section 61-1-704, a statement of dissolution under Tenn. Code Ann. Section 61-1-805, or a statement of merger under Tenn. Code Ann. Section 61-1-907.

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

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

"Transferable Interest" means a Partner's share of profits and losses and right to receive distributions, as defined in Tenn. Code Ann. Section 61-1-101.

"Treasury Regulations" means the federal income tax 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 Tennessee, effective as of the Effective Date, pursuant to the Tennessee Revised Uniform Partnership Act (Tenn. Code Ann. Section 61-1-101 et seq.). Under the Act, a partnership is an entity distinct from its partners (Tenn. Code Ann. Section 61-1-201). No filing with the Tennessee Secretary of State is required for formation of a general partnership.

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

[________________________________]

or such other name as unanimously approved. If the Partnership operates under an assumed name, it shall file an assumed name certificate with the county register of deeds in each county where business is conducted, as required by Tenn. Code Ann. Section 61-1-105.

2.3 Purpose. The purpose of the Partnership is to:

[________________________________]
[________________________________]

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

2.4 Principal Office. The principal office shall be at:

[________________________________]
[________________________________]
[________________________________] County, Tennessee [____]

or at such other location as determined by Majority Interest vote.

2.5 Registered Agent (if applicable). If the Partnership files a Statement of Partnership Authority or registers as an LLP:

Registered Agent: [________________________________]
Registered Office: [________________________________], Tennessee [____]

2.6 Term. The Partnership shall commence on the Effective Date and continue:

☐ In perpetuity, until dissolved under Article 12; or
☐ For a fixed term of [________________________________] years; or
☐ Until completion of the following particular undertaking: [________________________________]

2.7 Entity Status. Under the Tennessee RUPA (Tenn. Code Ann. Section 61-1-201), a partnership is an entity distinct from its partners. The Partnership may own property, sue and be sued, and enter contracts in its own name.

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. Contributions may be cash, property, or services.

3.2 Additional Contributions.

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

(b) If additional capital is needed, Partners may contribute pro rata or as otherwise agreed.

(c) A Partner who contributes additional capital while others decline shall have Percentage Interests adjusted.

(d) Failure to make a required contribution within [____] days of notice constitutes Default under Section 13.1.

3.3 Capital Accounts. A separate Capital Account shall be maintained for each Partner per Treasury Regulations Section 1.704-1(b)(2)(iv), increased by contributions and Profit allocations, and decreased by distributions and Loss allocations.

3.4 No Interest on Capital. No interest accrues on Capital Contributions or Capital Account balances unless otherwise unanimously agreed.

3.5 Withdrawal of Capital. No Partner may withdraw capital without all Partners' consent, except upon dissolution under Article 12.

3.6 Loans by Partners. Partner loans require Majority Interest consent and shall bear interest at [____]% per annum. Partner loans are repaid before distributions.

3.7 Return of Capital. No right to demand return of Capital Contributions except upon dissolution. Under Tenn. Code Ann. Section 61-1-401(h), a Partner is not entitled to remuneration for services except reasonable compensation for winding up.

ARTICLE 4: ALLOCATIONS; DISTRIBUTIONS; TAX MATTERS

4.1 Allocations of Profits and Losses.

(a) General Rule. Profits and Losses shall be allocated in proportion to Percentage Interests.

(b) Substantial Economic Effect. Allocations shall satisfy the substantial economic effect test under Treasury Regulations Section 1.704-1(b).

(c) Capital Account Adjustments. Per Treasury Regulations Section 1.704-1(b)(2)(iv).

(d) Regulatory Allocations:
(i) Minimum Gain Chargeback per Treasury Regulations Section 1.704-2(f);
(ii) Qualified Income Offset per Treasury Regulations Section 1.704-1(b)(2)(ii)(d);
(iii) Nonrecourse Deductions allocated per Percentage Interests.

4.2 Distributions.

(a) Distributions of Net Cash Flow at times and amounts determined by Majority Interest, no less than [quarterly / annually].

(b) Distributions pro rata per Percentage Interests.

(c) No distribution rendering the Partnership unable to pay debts as they become due.

(d) Tax Distributions. The Partnership shall distribute amounts reasonably estimated to cover each Partner's federal and state income tax liability. Tennessee does not impose a general income tax on earned income (the Hall Income Tax on investment income was repealed effective January 1, 2021), but Partners may owe taxes in other jurisdictions.

4.3 Withholding. The Partnership shall withhold amounts required under federal and applicable state tax laws.

4.4 Tax Elections.

☐ Section 754 election
☐ [Cash / Accrual] method
☐ Other elections as the Partnership Representative deems appropriate

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

(a) Act on behalf of the Partnership in federal tax proceedings;
(b) Keep Partners informed;
(c) Pursue push-out elections under Code Section 6226 when available; and
(d) Be subject to removal by Majority Interest vote.

4.6 Tax Returns. The Partnership shall file:

(a) IRS Form 1065;
(b) Tennessee Form FAE170 (if subject to franchise and excise tax -- see Section 16.4 for exemption analysis);
(c) Tennessee business tax return (if applicable); and
(d) Schedule K-1 to each Partner no later than March 15 annually.

ARTICLE 5: MANAGEMENT; VOTING; MEETINGS

5.1 Management.

☐ Option A: Partner-Managed. All Partners collectively manage the Partnership.

☐ Option B: Managing Partner. [________________________________] (the "Managing Partner") manages day-to-day operations.

5.2 Authority of Partners. Under Tenn. Code Ann. Section 61-1-301, each Partner is an agent of the Partnership for the purpose of its business. An act of a Partner for apparently carrying on in the ordinary course the Partnership's business binds the Partnership, unless the Partner had no authority and the third party knew or had notice.

5.3 Ordinary Decisions. Require Majority Interest vote. Under Tenn. Code Ann. Section 61-1-401(j), differences in the ordinary course may be decided by a majority of the Partners.

5.4 Major Decisions. Require unanimous written consent:

(a) Amendment of this Agreement;
(b) Admission of a new Partner;
(c) Sale of all or substantially all assets;
(d) Merger, conversion, or reorganization;
(e) Voluntary dissolution;
(f) Contracts exceeding $[________________________________];
(g) Indebtedness exceeding $[________________________________];
(h) Filing a Statement of Partnership Authority;
(i) Conversion to LLP or other entity;
(j) Litigation involving claims exceeding $[________________________________];
(k) Change in Partnership purpose; and
(l) Acts outside the ordinary course (per Tenn. Code Ann. Section 61-1-401(j)).

5.5 Meetings.

(a) Regular meetings at least [quarterly / annually].
(b) Special meetings on five (5) business days' written notice.
(c) Electronic participation permitted.

5.6 Quorum. Majority Interest constitutes a quorum.

5.7 Action Without Meeting. Permitted by written consent of the requisite voting interest.

5.8 Minutes. Written minutes shall be maintained.

5.9 Officers and Agents. The Partners may appoint officers and agents by Majority Interest vote.

ARTICLE 6: REPRESENTATIONS AND WARRANTIES

Each Partner represents and warrants as of the Effective Date:

6.1 Authority. Full legal right, power, and authority to execute and perform this Agreement.

6.2 Enforceability. This Agreement is a legal, valid, and binding obligation.

6.3 No Conflict. No violation of any law, agreement, or instrument binding on such Partner.

6.4 No Litigation. No pending or threatened litigation affecting performance.

6.5 Investment Purpose. Partnership Interest acquired for investment, not for distribution.

6.6 Sophistication. Experienced in business; has had opportunity to consult advisors.

6.7 Tax Acknowledgment. Acknowledges Tennessee tax structure, including the franchise and excise tax regime, the business tax, and the absence of a general state income tax on earned income.

6.8 Survival. These representations survive for so long as the Partner remains a Partner.

ARTICLE 7: COVENANTS AND RESTRICTIONS

7.1 Compliance with Law. The Partnership and each Partner shall comply with all applicable laws, including the Tennessee RUPA and all Tennessee tax requirements.

7.2 Non-Competition.

(a) During the Partnership term and for [____] months following withdrawal or dissociation, no Partner shall engage in a competitive business within [________________________________].

(b) Tennessee courts analyze restrictive covenants under a reasonableness standard. Under Tennessee law, non-compete agreements must be reasonable as to time, territory, and scope. The Tennessee Court of Appeals has held that restrictive covenants ancillary to a partnership agreement are enforceable if they protect legitimate business interests and are not unreasonably burdensome.

(c) Passive ownership of less than 5% of publicly traded securities is not prohibited.

7.3 Non-Solicitation. During the Partnership term and for [____] months following withdrawal, no Partner shall solicit employees, contractors, or customers.

7.4 Confidentiality.

(a) Each Partner shall maintain confidentiality of all proprietary Partnership information.

(b) Survives [____] years after termination.

(c) Standard exceptions for public information, prior knowledge, and legal requirements.

7.5 Duty of Loyalty. Under Tenn. Code Ann. Section 61-1-404(b), each Partner's duty of loyalty includes:

(a) Accounting for profits derived from Partnership business or use of Partnership property;
(b) Refraining from dealing as or on behalf of an adverse party; and
(c) Refraining from competing with the Partnership.

7.6 Duty of Care. Under Tenn. Code Ann. Section 61-1-404(c), the duty of care is limited to refraining from grossly negligent or reckless conduct, intentional misconduct, or knowing violation of law.

7.7 Good Faith and Fair Dealing. Per Tenn. Code Ann. Section 61-1-404(d).

7.8 Notice of Material Events. Prompt notification of material breaches, adverse changes, threatened litigation, or dissolution events.

ARTICLE 8: BOOKS, RECORDS, AND ACCOUNTING

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

8.2 Method of Accounting. [Cash / Accrual] method, GAAP consistently applied.

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

(a) Current Partner list with addresses and Percentage Interests;
(b) Tax returns for current and prior three (3) years;
(c) This Agreement and amendments;
(d) Financial statements for current and prior three (3) years;
(e) Capital account records;
(f) Meeting minutes; and
(g) All records required by the Act.

8.4 Inspection Rights. Under Tenn. Code Ann. Section 61-1-403, each Partner and the Partner's agent or attorney may inspect and copy Partnership books and records during ordinary business hours.

8.5 Financial Reports.

(a) Quarterly unaudited statements within thirty (30) days of quarter end.
(b) Annual financial statements within ninety (90) days of Fiscal Year end.

8.6 Bank Accounts. Partnership funds deposited in accounts in the Partnership name. Withdrawals require signature of [________________________________].

8.7 Independent Auditor. May be engaged by Majority Interest vote.

ARTICLE 9: INSURANCE AND RISK MANAGEMENT

9.1 Required Insurance.

(a) Commercial General Liability -- $[________________________________] per occurrence / $[________________________________] aggregate;
(b) Property Insurance -- replacement cost;
(c) Professional Liability (if applicable) -- $[________________________________] per claim;
(d) Workers' Compensation as required by Tennessee law (Tenn. Code Ann. Section 50-6-101 et seq., required for employers with five (5) or more employees); and
(e) Other insurance as the Partners deem appropriate.

9.2 Additional Insureds. Partners named as additional insureds where feasible.

9.3 Annual Review. Insurance reviewed at least annually.

9.4 Risk Management. Appropriate policies and procedures maintained.

ARTICLE 10: INDEMNIFICATION; LIMITATION OF LIABILITY

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

(a) Breach of this Agreement;
(b) Fraud, gross negligence, or willful misconduct;
(c) Acts outside the scope of authority; or
(d) Violation of law.

10.2 Partnership Indemnification. Under Tenn. Code Ann. Section 61-1-401(c), the Partnership shall reimburse and indemnify each Partner for payments made and liabilities incurred in the ordinary course of Partnership business, except for Losses caused by such Partner's own misconduct.

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

10.4 Limitation of Liability.

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

(b) Aggregate liability:
☐ Unlimited (default)
☐ $[________________________________] (inter-partner cap; does not affect third-party liability)

10.5 Third-Party Liability. Under Tenn. Code Ann. Section 61-1-306, all Partners are jointly and severally liable for all obligations of the Partnership. Under Tenn. Code Ann. Section 61-1-307, a judgment against the Partnership is not by itself a judgment against a Partner; exhaustion of Partnership assets or other conditions may be required.

10.6 Exculpation. No Partner liable for good faith errors in judgment within the scope of authority.

ARTICLE 11: TRANSFER OF INTERESTS; ADMISSION; WITHDRAWAL

11.1 Restrictions on Transfer. No Partner may sell, assign, pledge, or otherwise transfer ("Transfer") any Partnership Interest without:

(a) Compliance with securities laws;
(b) Prior written consent of Partners holding at least [____]% of non-transferring interests; and
(c) Transferee's execution of a joinder agreement.

11.2 Transferable Interest. Under Tenn. Code Ann. Section 61-1-502, the only transferable interest is the Partner's share of profits and losses and right to distributions. Transfer of only the economic interest does not give the transferee management rights.

11.3 Right of First Refusal.

(a) A Partner receiving a bona fide third-party offer must first offer the interest to remaining Partners.
(b) [____] day exercise period.
(c) If not exercised, transfer may proceed on no better terms.

11.4 Permitted Transfers. Transfers without consent to revocable trusts, family members, or wholly owned entities, provided the transferee agrees to be bound by this Agreement.

11.5 Admission of New Partners. Unanimous consent, joinder execution, and Schedule A amendment required.

11.6 Withdrawal.

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

(b) Under Tenn. Code Ann. Section 61-1-602, a Partner has the power to dissociate at any time by express will, but such dissociation may be wrongful if it breaches the Agreement or occurs before the expiration of a definite term.

(c) Wrongful dissociation subjects the withdrawing Partner to liability for damages.

ARTICLE 12: DISSOCIATION; DISSOLUTION; WINDING UP

12.1 Events of Dissociation. Under Tenn. Code Ann. Section 61-1-601:

(a) Notice of express will to withdraw;
(b) Event specified in this Agreement;
(c) Expulsion by unanimous vote (if unlawful to carry on business with Partner, all transferable interest transferred, entity Partner dissolved, or conduct making it impracticable to carry on);
(d) Judicial expulsion;
(e) Bankruptcy;
(f) Death or incapacity;
(g) Trust or estate termination; or
(h) Entity dissolution.

12.2 Effect of Dissociation.

(a) Management and voting rights terminate;
(b) Duties of loyalty and care end (except for pre-dissociation matters);
(c) Under Tenn. Code Ann. Section 61-1-703, the dissociated Partner's apparent authority terminates two (2) years after dissociation; and
(d) If the Partnership continues, the buyout provisions of Section 12.5 apply.

12.3 Statement of Dissociation. The Partnership may file a Statement of Dissociation with the Tennessee Secretary of State under Tenn. Code Ann. Section 61-1-704, which limits the dissociated Partner's authority ninety (90) days after filing.

12.4 Dissolution Events. Under Tenn. Code Ann. Section 61-1-801:

(a) Partnership at will: Notice of a Partner's express will to withdraw (unless a Majority Interest agrees to continue within 90 days);

(b) Definite term/undertaking partnership: Within ninety (90) days after a Partner's death, Bankruptcy, wrongful dissociation, or judicial expulsion, the express will of at least half the remaining Partners to wind up; or expiration of the term;

(c) An event specified in this Agreement;

(d) An event making it unlawful to carry on business (unless cured within 90 days);

(e) Judicial dissolution under Tenn. Code Ann. Section 61-1-801(5); or

(f) Unanimous written agreement.

12.5 Buyout of Dissociated Partner's Interest.

(a) Under Tenn. Code Ann. Section 61-1-701, if the business continues, the Partnership shall purchase the dissociated Partner's interest.

(b) The buyout price equals the amount distributable to the dissociated Partner if the Partnership's assets were sold at the greater of liquidation value or going-concern value, plus interest.

(c) Payment within [____] days or in [____] monthly installments at [____]% interest.

12.6 Winding Up.

(a) Upon dissolution, winding up by Partners who have not wrongfully dissociated, or by court-appointed person.

(b) During winding up:
(i) Collect all amounts owed;
(ii) Pay all debts and obligations;
(iii) Liquidate assets;
(iv) Distribute remaining assets per Section 12.6(c); and
(v) File Statement of Dissolution with Secretary of State under Tenn. Code Ann. Section 61-1-805.

(c) Order of Distribution (per Tenn. Code Ann. Section 61-1-807):
(i) To creditors (including Partner-creditors);
(ii) To Partners for prior distributions owed; and
(iii) To Partners per positive Capital Account balances.

12.7 Statement of Dissolution. A Statement of Dissolution may be filed under Tenn. Code Ann. Section 61-1-805, which cancels any filed Statement of Partnership Authority and provides constructive notice ninety (90) days after filing.

ARTICLE 13: DEFAULT AND REMEDIES

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

(a) Materially breaches this Agreement and fails to cure within thirty (30) days of written notice;
(b) Becomes insolvent or files for bankruptcy;
(c) Engages in fraud, embezzlement, or criminal conduct;
(d) Willfully violates fiduciary duties;
(e) Fails to make required Capital Contributions; or
(f) Breaches restrictive covenants.

13.2 Remedies. Non-defaulting Partners may:

(a) Suspend the Defaulting Partner's rights;
(b) Purchase the interest at the lesser of fair market or book value;
(c) Offset damages;
(d) Seek specific performance or injunctive relief;
(e) Expel the Defaulting Partner; or
(f) Dissolve the Partnership.

13.3 Cumulative Remedies. All remedies are cumulative.

13.4 Attorneys' Fees. Prevailing party entitled to reasonable attorneys' fees and costs.

13.5 Tennessee Statute of Limitations. Partners should be aware:

(a) General contract claims: six (6) years (Tenn. Code Ann. Section 28-3-109);
(b) Fraud claims: three (3) years from discovery (Tenn. Code Ann. Section 28-3-105);
(c) Actions for injuries to personal property: three (3) years (Tenn. Code Ann. Section 28-3-105); and
(d) Claim-specific accrual, limitation, repose, and contractual periods must be classified and calendared from current authority.

ARTICLE 14: DISPUTE RESOLUTION

14.1 Negotiation. Good faith negotiation first.

14.2 Mediation. If unresolved within thirty (30) days, mediation in [________________________________] County, Tennessee.

14.3 Arbitration or Litigation.

☐ Option A: Arbitration. Binding arbitration under AAA Commercial Arbitration Rules in [________________________________], Tennessee. One arbitrator with ten (10) years' experience.

☐ Option B: Litigation. State or federal courts in [________________________________] County, Tennessee.

14.4 Injunctive Relief. Available in state or federal courts in [________________________________] County, Tennessee.

14.5 Jury Trial Waiver. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTNER HEREBY IRREVOCABLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

14.6 Confidentiality. All proceedings shall be confidential.

14.7 Governing Law for Disputes. Tennessee law applies.

ARTICLE 15: GENERAL PROVISIONS

15.1 Governing Law. This Agreement is governed by Tennessee law, including the Tennessee Revised Uniform Partnership Act (Tenn. Code Ann. Section 61-1-101 et seq.), without regard to conflict of laws principles.

15.2 Amendments. Written instrument signed by all Partners required.

15.3 Waiver. No waiver by delay.

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

15.5 Severability. Invalid provisions reformed to minimum extent; remainder enforceable.

15.6 Successors and Assigns. Binding on heirs, executors, administrators, successors, and permitted assigns.

15.7 Notices. Written notices deemed given upon:

(a) Personal delivery;
(b) One (1) business day after overnight courier;
(c) Confirmed email; or
(d) Three (3) business days after first-class mail, return receipt requested.

15.8 Counterparts; Electronic Signatures. Multiple counterparts; electronic signatures binding.

15.9 Interpretation. Headings for convenience; "including" means "including without limitation"; singular includes plural.

15.10 Force Majeure. No liability for failure to perform (except payment) caused by events beyond reasonable control ("Force Majeure Event"), with prompt notice and mitigation.

15.11 No Third-Party Beneficiaries. No rights conferred on non-parties.

15.12 Further Assurances. Partners shall execute additional documents as reasonably necessary.

ARTICLE 16: TENNESSEE-SPECIFIC PROVISIONS

16.1 Governing Statute. This Partnership is governed by the Tennessee Revised Uniform Partnership Act, Tenn. Code Ann. Section 61-1-101 et seq. Tennessee adopted RUPA effective January 1, 2002. Under RUPA as adopted in Tennessee:

(a) The partnership is a separate legal entity (Tenn. Code Ann. Section 61-1-201);
(b) The entity theory applies (as opposed to the aggregate theory of the original UPA);
(c) Dissociation of a Partner does not necessarily result in dissolution (Tenn. Code Ann. Section 61-1-801); and
(d) The Act provides default rules that may be modified by the partnership agreement, except as specifically restricted by Tenn. Code Ann. Section 61-1-103.

16.2 No State Formation Filing Required. Tennessee does not require filing of any document with the Secretary of State to form a general partnership. The Partnership exists upon the association of the Partners as co-owners of a business for profit.

16.3 Statement of Partnership Authority.

(a) The Partnership may file a Statement of Partnership Authority with the Tennessee Secretary of State under Tenn. Code Ann. Section 61-1-303.

(b) A Statement must include:
(i) The name of the Partnership;
(ii) The street address of the chief executive office and one office in Tennessee (if any);
(iii) Names and addresses of all Partners or an agent maintaining the Partner list; and
(iv) Names of Partners authorized to execute instruments transferring real property.

(c) The Statement must be executed by at least two (2) Partners.

(d) A filed Statement is effective for five (5) years unless canceled.

(e) A grant of real property transfer authority in a filed Statement is conclusive in favor of good-faith purchasers for value if a certified copy is recorded in the county register of deeds.

(f) The Partners elect:

☐ To file a Statement of Partnership Authority
☐ Not to file at this time

16.4 Tennessee Franchise and Excise Tax.

(a) Determine Coverage from the Current Rules. The Tennessee Department of Revenue's current overview identifies corporations, limited partnerships, limited liability companies, and business trusts as the principal entity classes subject to franchise and excise taxes when chartered, qualified, registered, or doing business in Tennessee. Do not classify this general partnership solely by whether its Partners are natural persons.

(b) Check Legal Form and Liability Protection. Before filing or claiming noncoverage, confirm the Partnership's actual legal form, whether it has registered or elected limited-liability status, its Tennessee activities and nexus, and whether an exemption under Tenn. Code Ann. Section 67-4-2008 applies and has been properly claimed.

(c) Current Return and Figures. If the Partnership is subject to franchise and excise taxes, use the current Tennessee Department of Revenue instructions and Form FAE170. Do not rely on hard-coded rates, bases, deductions, exemptions, or thresholds in this Agreement.

16.5 Tennessee Business Tax.

(a) Tennessee imposes a business tax on the privilege of doing business in Tennessee (Tenn. Code Ann. Section 67-4-701 et seq.).

(b) The business tax applies to businesses with gross receipts exceeding certain thresholds. Rates vary by classification and location.

(c) The Partnership shall register for and file business tax returns as required with the Tennessee Department of Revenue and applicable local jurisdictions.

(d) Business tax is separate from the franchise and excise tax.

16.6 Tennessee Hall Income Tax (Repealed).

(a) The Tennessee Hall Income Tax on interest and dividend income was repealed effective January 1, 2021.

(b) Tennessee no longer imposes any state-level income tax on individuals.

(c) Partners remain subject to federal income tax on all Partnership income.

16.7 Filing Fees and Agency Information.

Tennessee Secretary of State, Division of Business Services
312 Rosa L. Parks Avenue, 6th Floor
Nashville, TN 37243
Telephone: (615) 741-2286
Website: www.sos.tn.gov

Tennessee Department of Revenue
Andrew Jackson State Office Building
500 Deaderick Street
Nashville, TN 37242
Telephone: (615) 253-0600
Website: www.tn.gov/revenue

16.8 LLP Conversion Option. Under Tenn. Code Ann. Section 61-1-1001, the Partnership may register as a limited liability partnership by filing a Statement of Qualification:

(a) The name must contain "Registered Limited Liability Partnership," "Limited Liability Partnership," "R.L.L.P.," "L.L.P.," "RLLP," or "LLP";
(b) The filing must include the street address of the chief executive office;
(c) Registration provides a liability shield under Tenn. Code Ann. Section 61-1-306(c); and
(d) Annual renewal of the Statement of Qualification is required.

16.9 Real Property Provisions.

(a) Partnership property may be held in the Partnership name (Tenn. Code Ann. Section 61-1-204).

(b) A Statement of Partnership Authority specifying real property transfer authority, when filed with the Secretary of State and recorded with the county register of deeds, is conclusive in favor of good-faith purchasers for value (Tenn. Code Ann. Section 61-1-303(d)).

(c) Real property conveyances should reference the Partnership's name and the authority of the executing Partner.

16.10 Merger and Conversion. Under Tenn. Code Ann. Section 61-1-901 et seq., the Partnership may merge with other partnerships. A plan of merger requires approval by all Partners and filing of a Statement of Merger with the Secretary of State.

16.11 Tennessee Workers' Compensation. Under Tenn. Code Ann. Section 50-6-102, employers with five (5) or more employees must carry workers' compensation insurance. The Partnership shall comply if it employs the threshold number of employees.

16.12 Assumed Name Registration. If the Partnership operates under a name other than the legal names of all Partners, it should file an assumed name registration with the county register of deeds in each county where business is conducted. This provides public notice of the true identity of the Partners.

ARTICLE 17: EXECUTION AND SIGNATURE BLOCKS

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 SIGNATURES

Partner A:

Signature: _______________________________________________

Printed Name: [________________________________]

Title (if entity): [________________________________]

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

Partner B:

Signature: _______________________________________________

Printed Name: [________________________________]

Title (if entity): [________________________________]

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

Partner C (if applicable):

Signature: _______________________________________________

Printed Name: [________________________________]

Title (if entity): [________________________________]

Date: [__/__/____]

Address: [________________________________]
[________________________________]
[________________________________]

Email: [________________________________]

NOTARY ACKNOWLEDGMENT

STATE OF TENNESSEE
COUNTY OF [________________________________]

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

☐ [________________________________], known to me (or proved 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.

☐ [________________________________], known to me (or proved 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).

WITNESS my hand and official seal.

Notary Public Signature: _______________________________________________

Printed Name: [________________________________]

My Commission Expires: [__/__/____]

[NOTARY SEAL]

SCHEDULE A: PARTNERS; CAPITAL CONTRIBUTIONS; PERCENTAGE INTERESTS

Non-Cash Contribution Descriptions:

Partner [____]: [________________________________]
Agreed FMV: $[________________________________]
Basis: [________________________________]

SCHEDULE B: STATE-SPECIFIC RIDER

B.1 Partnership Classification:

☐ Partnership at will
☐ Partnership for a definite term of [____] years
☐ Partnership for a particular undertaking: [________________________________]

B.2 Statement of Partnership Authority:

☐ Filed with TN Secretary of State on [__/__/____]
☐ Not filed

B.3 Real Property Authority. Partners authorized to execute real property instruments:

☐ [________________________________]
☐ [________________________________]

B.4 Franchise and Excise Tax Status:

☐ Not within a currently taxable entity class after legal-form, liability-status, registration, activity, and nexus review
☐ Exemption under Tenn. Code Ann. Section 67-4-2008 claimed and documented
☐ Subject to F&E tax under current Department of Revenue rules
☐ Undetermined -- consult tax advisor

B.5 Tennessee Business Tax Registration:

☐ Registered -- Account No.: [________________________________]
☐ Exempt (below threshold)
☐ Not yet registered

B.6 Assumed Name Filing:

☐ Filed in [________________________________] County on [__/__/____]
☐ Not applicable

SCHEDULE C: FORM OF JOINDER AGREEMENT

JOINDER TO GENERAL PARTNERSHIP AGREEMENT

The undersigned ("New Partner") agrees to be bound by all terms of the General Partnership Agreement dated [__/__/____] among the Partners of [________________________________].

Capital Contribution: $[________________________________]
Percentage Interest: [____]%
Contribution Form: ☐ Cash ☐ Property ☐ Services
Effective Date: [__/__/____]

New Partner:

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

Printed Name: [________________________________]

Acknowledged by Existing Partners:

Partner A: _______________________________________________ Date: [__/__/____]

Partner B: _______________________________________________ Date: [__/__/____]

SCHEDULE D: PARTNERSHIP PROPERTY (INITIAL)

DISCLAIMER: This template is provided for informational purposes only and does not constitute legal advice. This document should be reviewed, customized, and approved by a qualified attorney licensed in Tennessee before execution. The use of this template does not create an attorney-client relationship. Laws change frequently, and this template may not reflect the most current statutory requirements. Do not rely on this template without independent legal review.

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