Partnership Agreement - Long Form (Canada)

Agreement that formalizes and documents the partnership of two or more people in the ownership of a for-profit business.

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A partnership agreement is a document that formalizes the partnership of two or more people in their ownership of a for-profit business. The Partnership Agreement Long Form differs from the Short Form because it includes additional provisions governing dissolution, buyout of a partner and other subjects.

This form can be used in the following provinces: Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Ontario, Prince Edward Island, Saskatchewan and Yukon.
Number of Pages7
DimensionsDesigned for Letter Size (8.5" x 11")
EditableYes (.doc, .wpd and .rtf)
UsageUnlimited number of prints
Product number#28268
This is the content of the form and is provided for your convenience. It is not necessarily what the actual form looks like and does not include the information, instructions and other materials that come with the form you would purchase. An actual sample can also be viewed by clicking on the "Sample Form" near the top left of this page.
Partnership Agreement
THIS AGREEMENT made as of       between      , of       and      , of       
WHEREAS the parties hereto are desirous of entering into a partnership (the “Partnership”) with one another concerning a business of a       (the “Business”) located at       (the “Premises”);
NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the mutual covenants and agreements herein contained and subject to the terms and conditions hereafter set out, the parties hereto agree as follows:
1.   Business and Name. From and after the date of this Agreement, the partners agree to carry on the Business in partnership with one another as equal partners under the name      ”.
2.   Principal Office. The principal office of the Business shall be at the Premises or at such other place or places as the partners may from time to time agree upon.
3.   Time and Effort to Partnership. From and after the date of this Agreement, both partners shall contribute to the Partnership their whole time, labor and attention. Each partner shall have the right to draw from the Partnership monthly, as salary, the sum of      , or such sum as may be agreed upon from time to time by the partners.
4.   Capital Contribution. Both partners shall contribute the sum of       to be deposited within two (2) weeks of the date of this Agreement, to the bank account of the Partnership. Except as otherwise agreed by the partners or as provided herein, no contribution to the capital of the Partnership by either partner shall bear interest. Both partners shall contribute equally any additional capital which they deem necessary for carrying on the Business. If either partner shall at any time, with the consent of the other partner, advance any money to the Partnership beyond the amount of the capital hereby agreed to be brought in by him or her, or if he or she shall leave any part of his or her profits in the Partnership, the said money or profits shall be a debt due to him or her from the Partnership, and may be withdrawn by him or her at any time on one months notice in writing, and shall in the meantime bear interest at the rate of twelve per cent (12%) per annum from the time of such advance until repaid.
5.   Banking. The bank of the Partnership shall be whatever bank or banks the partners hereto shall from time to time agree upon. All monies received from time to time on account of the Partnership shall be paid immediately into the bank for the time being of the Partnership in the same drafts, cheques, bills or cash in which they are received, and all disbursements an account of the Partnership shall be made by cheque on such bank.
6.   Cheques. Both partners together shall draw cheques in the name of the Partnership and may sign, endorse and accept in the name of the Partnership all bills, notes, cheques, drafts or other instruments for the purpose of the Partnership.
7.   Profits, Losses. The net profits of the Partnership shall belong to the partners in equal shares. All expenses incurred in the course of the Partnership and any losses arising therefrom shall be borne out of the earnings of the Partnership, or in the case of a deficiency, the losses shall be paid by the partners in equal shares.
8.   Accounting. Proper accounts shall be kept of all transactions of the Partnership and at the end of each year or so soon thereafter as possible a statement shall be made out showing the income and expenses of the Partnership for the past year, and what belongs and is due to each of the partners as his share of the profits. If required by either partner each year the books shall be audited by an accountant at the expense of the Partnership, and in addition each of the partners may at any time or times have the books audited by an accountant at his own expense. All books and documents connected with the Partnership shall be accessible to each of the partners or his agent at all times.
9.   Prohibited Acts. No partner shall, without the consent in writing of the other, do any of the following things, namely:
(a)   Be engaged directly or indirectly, or be connected with any trade or business other than the Business;
(b)   Release, discharge or compromise any debt owing to or claimed by the Partnership;
(c)   Give any bond, or become security for any person or do, or knowingly permit to be done, anything whereby any of the capital or property of the Partnership may be seized, attached or taken in execution;
(d)   Assign all or any part of his or her interest in the Partnership, or introduce or attempt to introduce any other person into the Partnership, without the authority of the other partner;
(e)   Make any agreement on behalf of the Partnership for the purchase of property or goods exceeding in value of one thousand dollars ($1,000.00);
(f)   Borrow money, endorse any notes or become security for any other person in the name of the Partnership;
(g)   Hire any employee for the Partnership or discharge any employee of the Partnership;
(h)   Contract on behalf of the Partnership otherwise than in the Partnerships name;
(i)   Order or contract for any goods or article exceeding the value of one thousand dollars ($1,000.00);
(j)   Buy, order or contract for any article, or enter into any contract or number of contracts in the Partnerships name, the fulfillment of which would necessitate further capital, or further borrowing, without the mutual consent in writing of both partners.
(k)   Employ any money or effects belonging to the Partnership, or engage its credit, except on account of the Partnership and for the bona fide purposes of carrying on the Business, or do or suffer anything whereby any such money or effects, or the interest of such partner therein, may be taken in execution or in any wise assigned, charged or encumbered for or in respect of his private debts; or
(l)   Make, draw, accept, sign, or endorse any bill of exchange, draft, promissory note, or contract any debt on account or in the name of the Partnership, or in any manner pledge the credit of the Partnership, except in the usual and regular course of business.
10.   Termination of Partnership. Upon the termination of the Partnership the assets of the Partnership shall be realized and applied first in payment of the debts and liabilities of the Partnership and any surplus shall be divided equally between the partners.
11.   Use of Name. If one of the partners withdraws from the Partnership, the name      ” shall remain the property of the partner remaining.
12.   Right of First Refusal. If either partner shall desire to sell his or her interest in the Partnership he or she shall be at liberty to do so, and in such case shall first offer such interest to the other partner at a price to be named by the selling partner; and if the other partner shall not, within thirty (30) days thereafter, accept such offer, then the selling partner shall for a period of three (3) months thereafter be at liberty to sell his or her share and interest to any other person or persons at the same or a higher price, but shall not sell it to any other person at a lesser price unless and until it shall have been offered to the other partner at such lesser price, and that such last mentioned offer shall not have been accepted within thirty (30) days thereafter. Provided however, that if the selling partner does not sell such share and interest in the Partnership within such three (3) month period, he or she must again comply with the provisions of this paragraph in respect of any subsequent sale.
13.   Option to Purchase on Death or Insolvency. If either partner should die or become insolvent while both partners have an interest in the Partnership, the other partner if mutually agreeable shall remain in partnership with the estate of the deceased or insolvent partner, provided that if the other partner or the estate of the deceased or insolvent partner is not agreeable to remaining in partnership, then the other partner may purchase the interest of the deceased or insolvent partner from his estate. In such event the purchase price and terms of payment shall be agreed upon between the other partner and the estate of the deceased or insolvent partner; provided that if no agreement can be reached then the purchase price and terms of payment shall be established by arbitration in accordance with this Agreement. The other partner shall then be entitled to retain the name of the Partnership.
If the other partner does not remain in partnership with the estate of the deceased or insolvent partner and does not wish to purchase the interest of the deceased or insolvent partner from his or her estate, then the Business shall be sold and the surplus after payment of all debts and liabilities of the Business shall be divided equally between the other partner and the estate of the deceased or insolvent partner.
14.   Arbitration. All matters in difference in relation to this Agreement and to the affairs of the Partnership shall be referred to the arbitration of a single arbitrator, if the partners agree upon one, otherwise to three arbitrators, one to be appointed by each party and a third to be chosen by the first two named before they enter upon the business of arbitration. The award and determination of such arbitrator or arbitrators, or any two of such three arbitrators, shall be binding upon the partners and their respective heir, executors administrators and assigns.
15.   Insurance on Vehicles. All trucks and automobiles now or hereafter owned by the Partnership or by either of the partners shall be insured to the maximum amounts required by either partner.
16.   Holidays. The partners agree that they shall each be entitled to equal holidays each year.
17.   Amendments. If at any time during the term of this Agreement the partners shall deem it necessary or expedient to make any alteration in any article, clause, matter or thing herein contained they may do so by a writing signed by them and endorsed on these articles, and all such alterations shall be adhered to and have the same force and effect as if they had been originally embodied in and formed part of this Agreement.
18.   Successors and Assigns. This Agreement shall enure to the benefit of and be binding upon the respective heirs, executors, administrators and assigns of each of the parties hereto.
19.   Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Province of      .
20.   Headings. The headings of the paragraphs hereof are inserted for convenience of reference only and shall not affect the interpretation or construction of this Agreement.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first above written.
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