Partnership Exit Agreement

Free Partnership Exit Agreement Template

Use this free template as a starting point for documenting the withdrawal of a partner from a partnership. Copy and customise it to suit your partnership agreement, jurisdiction, and the specific exit terms agreed.

PARTNERSHIP EXIT AGREEMENT

Date: [Date of agreement]

Parties:

(1) Continuing Partners: [Names of remaining partners], collectively the "Continuing Partners"

(2) Exiting Partner: [Full name of departing partner], the "Exiting Partner"

(3) Partnership: [Name of partnership], a [general partnership / limited partnership / LLP] registered at [Address] (the "Partnership")

Background

A. The Parties are party to a partnership agreement dated [Date of original partnership agreement] (the "Partnership Agreement").

B. The Exiting Partner has given notice of intention to withdraw from the Partnership with effect from [Effective date].

C. The Parties wish to record the terms of the Exiting Partner's withdrawal, the settlement of accounts, and the continuing obligations of the Exiting Partner.

1. Effective Date of Withdrawal

The Exiting Partner shall cease to be a partner in the Partnership with effect from [Effective date] (the "Exit Date"). From the Exit Date the Exiting Partner shall have no further rights or obligations as a partner, save as expressly preserved by this Agreement.

2. Settlement of Capital Account

• Exiting Partner's capital account balance at the Exit Date: [Currency and amount]
• Adjustments: [List any agreed adjustments for profit share, drawings, undrawn entitlements]
• Net sum payable to Exiting Partner: [Currency and amount]
• Payment terms: [Lump sum on Exit Date / Instalments over [N] months as set out in Schedule [X]]
• Payment method: [Bank transfer to [account details]]

3. Profit Share to the Exit Date

The Exiting Partner is entitled to their share of Partnership profits for the period from [Start of accounting period] to the Exit Date, calculated in accordance with the Partnership Agreement and the management accounts as at the Exit Date. The Continuing Partners shall calculate and pay this amount within [60] days of the Exit Date.

4. Partnership Property and Assets

• The Exiting Partner relinquishes any claim to Partnership property, intellectual property, goodwill, client lists, and ongoing work in progress, save for the settlement sum payable under clause 2.
• The Exiting Partner shall return all Partnership property in their possession (laptops, files, keys, access cards, credentials) by [Date].

5. Release and Continuing Liabilities

• The Continuing Partners release the Exiting Partner from all future obligations of the Partnership arising after the Exit Date.
• The Exiting Partner remains responsible for their proportionate share of liabilities incurred by the Partnership before the Exit Date, including tax liabilities accruing up to that date.
• Where the Partnership has personal guarantees signed by the Exiting Partner, the Continuing Partners shall use reasonable endeavours to procure release of those guarantees within [90] days, and shall indemnify the Exiting Partner against any claims arising under such guarantees in respect of post-Exit-Date matters.

6. Restrictive Covenants

For [12] months following the Exit Date, the Exiting Partner shall not:

• Solicit clients of the Partnership with whom the Exiting Partner had material dealings in the [12] months before the Exit Date;
• Solicit or employ employees or contractors of the Partnership active at the Exit Date;
• Hold themselves out as a current partner of the Partnership.

The restrictions in this clause shall apply only to the extent reasonable and enforceable under applicable law.

7. Confidentiality

The Exiting Partner shall keep confidential, and shall not use or disclose, any non-public information of the Partnership or its clients except as required by law or with the prior written consent of the Continuing Partners.

8. Public Notice of Withdrawal

The Continuing Partners shall, within [30] days of the Exit Date, publish notice of the Exiting Partner's withdrawal as required by applicable law and shall update Partnership stationery, websites, and external registers accordingly.

9. Mutual Release

Subject to the obligations expressly preserved by this Agreement, each Party releases the others from all claims arising out of or in connection with the Partnership up to the Exit Date.

10. Governing Law and Disputes

This Agreement is governed by the laws of [Jurisdiction]. Any disputes shall be resolved by the courts of [Jurisdiction], without prejudice to any arbitration or mediation clause separately agreed.

Signatures:

For and on behalf of the Continuing Partners:

_ Date: _ [Name], [Position]

_ Date: _ [Name], [Position]

The Exiting Partner:

_ Date: _ [Name]

This is a basic template provided for informational purposes. For a professionally generated and legally tailored document, use Bind's contract automation platform.