Present Day, third party online companies have been a boosting the traditional pharmacies were the rights of the parties may arise from leasing, licensing, renting or even by mutual contract management.
This is a sample tripartite partnership agreement for a pharmacy, which may be helpful for drafting agreements for both parties and their counsels.
PARTNERSHIP AGREEMENT
This Partnership Agreement (‘The Agreement” is made as of this 24th April 2021, (“the effective date”) by and between ABC, located as 256, Block -D Gandhi Avenue, 44001 (“Residence Address”) CPL Limited, located at 456, Bibbee Avenue, 440001 (“Office Address”) & XYZ, located at 297, Jamba Avenue, 440292 (“Residence Address”) (each a “Partner” and collectively, the “Partners”).
1. Partnership Name & Purpose
Partners Agree to form a partnership under the name of KK Medicals (“the Partnership”). In consideration of the mutual promises and agreements between the Parties hereto, the Parties have agreed to enter into this Agreement to govern the terms and conditions of their association as per the Indian Contract Act, Goods and Services Tax, Drugs and Cosmetics Act and the laws of the State. The partnership has been formed on the terms & conditions set forth below to engage in the business of running a Medical store, supplying medicines upon bulk orders and to engage in any and all other activities as may be necessary, related or incidental to carry on the business of the Partnership as provided herein.
2. Place of Business
The Principal office shall of the Partnership will be located at 256, Crittenden Avenue, 440092 (“Place of Business or POB”) or at such places as the Partners shall determine from time to time.
3. Partnership Term
The Partnership shall commence on the Effective Date and will continue until it terminates in accordance with the terms of this Agreement, unless terminated earlier in accordance with the terms of this Agreement.
4. Partners’ Capital Contributions
The partners will contribute capital to the Partnership withing 45 days (Forty five only) of the
Effective Date.
The Partners cash Contribution will be:
- XYZ- Rs.5,00,000
- ABC- Rs.5,00,000
- CPL Limited- Rs.10,00,000
- XYZ & ABC will provide for the office space (“Place of Business”).
CPL Limited will provide workforce and appoint trained Professionals.
The Non- Cash Contribution can be reimbursed in the form of Interest arising out of the partnership’s profit.
5. Partners’ Capital Accounts
The Partnership will establish and maintain for each Partner a separate capital account consisting of the Partners Capital Contributions. A Partner may not withdraw any portion of capital from his or her capital account without prior consent of all Partners. Interest, at the rates and times as determined by the Partners, will be paid on the capital account of any partner. Funds from this account shall be used to procure goods required for the running of the Partnership that may include resale counter items, Office rent, staff salary, setting up bank accounts and even the necessary cold storage machineries.
6. Profit & Losses
The net profits and losses of the Partnership will be divided equally amongst all three partners
and shall be settled in the capital account of the Partnership.
7. Partner’s Income Accounts
The Partnership will establish and maintain a separate income account for each partner. Each Partner’s share of the Partnership profits and losses will be credited to or charged against his or her income account. If there is no positive balance in a Partner’s Income account, losses will be charged against his or her capital account. No Interest will be paid on the income account of any Partner.
8. Partners’ Salary and Drawings
There will be no salary or compensation given to any Partner for services to the Partnership. A Partner may withdraw any profits from the business account at any time but only with the consent of all the Partners.
9. Partner’s Bank Account
The Partnership funds will be kept in an account in its name at IHSS Bank or at other financial institutions as agreed upon by all Partners. All withdraws from these accounts will be made by Cheques/RTGS/IMPTS/NEFT approved by all Partners before transacting.
10. Partnership Books and Records
At all times during the term of Partnership, the books and records of the Partnership will be kept and maintained at Partnerships ‘Place of Business’. Such books and records shall be available for inspection by any Partner and bis or her representative during the business hours upon reasonable notice. The Partnership shall maintain its books and records in accordance with standard accounting procedures as required by the GST Council and the Income Tax department. The partnership shall commence with “the Effective Date” and shall be terminated upon 4 years from the effective date. The income statement and balance sheets shall be prepared at the end of the every fiscal year on 31st March or any date as notified by the Income Tax Department. ITC shall be claimed for the respective goods supplied and returns shall be filed within 20 days or lastly by the end of first week of the succeeding month. Profit and Loss statements, Income Tax returns shall be prepared by the team of professional Chartered Accountant after the annual Audit.
11. Management
Each partner shall have an equal stake in the Management of the Partnership. The Partners will devote as much of his or her time and efforts to the affairs of the Partnership in order to accomplish the objectives. Each partner shall have a significant and ordinary decisions on behalf of the Partnership. Each partner has the power to make significant and ordinary decisions of behalf of the Partnership. All partners shall agree to take the following Partnership actions: Enter into, make and perform any contract or agreement including lease, security agreement or mortgage without the prior permission of other partner
Borrow or lend money without a prior notice
Sell any asset other than that sold in the regular course of the business with the approval of the partner.
Sign and hire authorities for effective management with mutual discussions.
12. Voluntary Dissolution of Partnership
The Partnership may be dissolved at any time upon the consent of all the Partners. The Partners shall as soon as reasonably practicable, liquidate and wind up the affair of Partnership. The proceeds, assets or any balance received or payable in connection with the Liquidation shall be appliable in following order-
All debts, liabilities and obligations of the Partnership including all expenses arising from the claim of Liquidation
Distribution to for the benefits of the Partners in accordance with the positive balance in each Partner’s Income Account.
Distribution to or for the benefit of the Partners in accordance with the positive balance in each partners’ capital account.
13. Partner’s Withdrawal
A partner may not withdraw from the Partnership unless all remaining Partners unanimously agree to the withdrawal. If the remaining Partner(s) agree to withdraw, the remaining Partner(s) may decide either to dissolve & liquidate the partnership with the withdrawing Partner as per clause 12 of the agreement, or shall continue the Partnerships by purchasing the withdrawing Partner’s Interest. The decision to dissolve of continue the Partnerships requires the unanimous consent of all the partners. If the remaining partner wishes to acquire the shares of the withdrawing partner then they shall provide a notice of such intention within 11 (eleven) days after the receipt of withdrawing Partner’s notice.
A partner shall be removed from the Partnership if such Partner:
Commits fraud
Declares bankruptcy
Is declared incompetent
Is imprisoned
The remaining Partner(s) may decide either to dissolve & liquidate the partnership with the withdrawing Partner as per clause 12 of the agreement, or shall continue the Partnerships by purchasing the withdrawing Partner’s Interest. The decision to dissolve of continue the Partnerships requires the unanimous consent of all the partners.
14. Partner’s Retirement
A partner may retire from the Partnership at the end of a calendar month where me pay be of the age of 58 years or more as per the month of January that year. A partner may be able show proof for mental or physical fitness in case of a voluntary retirement before attaining the age of 58. The remaining Partner(s) may decide either to dissolve & liquidate the partnership with the withdrawing Partner as per clause 12 of the agreement, or shall continue the Partnerships by purchasing the withdrawing Partner’s Interest. The decision to dissolve of continue the Partnerships requires the unanimous consent of all the partners, such intention shall be followed with a notice withing 21 days after the receipt of application for Partner’s retirement.
15. Death
In case of a death, the remaining Partners may decide either to dissolve and liquidate the partnership as per Clause 12 or continue the Partnership by purchasing the deceased Partner’s Interest. The decision to dissolve or continue the Partnership requires the unanimous consent of the remaining Partners. If the remaining Partners choose to purchase the deceases Partner’s Interest, the remaining Partner shall provide written notice of such intention to purchase the deceased Partner’s Interest withing 21 (twenty one) days the remaining Partners may continue to use the Partnership tradename.
16. Buyout
If the remaining Partners choose to Purchase the withdrawing, retiring or deceased Partner’s interest under the preceding paragraphs, that interest will be purchased in the amounts as decided by the remaining Partners that wish to Purchase. The value of withdrawing, retiring or deceased Partner’s Interest as per the fair market value as identified by an independent certified public accountant. The purchase price will not include any separate amounts for goodwill, tradename, patents or intangible assets. The remaining Partners may continue to use the Partnership tradename. The purchase price will be paid with interest at the rate of 8% per annum within (12) twelve months after the days of withdrawal, retirement or death.
17. Restriction on Transfer
No Partner shall transfer, assign, seek, give, pledge, hypothecate or otherwise encumber, or dispose of in any manner any of his or her interest in the Partnership without, retirement or death.
18. New Partners
The Partnership, upon mutual discussion and majority consent, may admit new Partners to the
Partnership on the terms and conditions as determined by the Partners at such time.
19. Dispute Resolutions
Any dispute arising out or related to this Agreement that the Partners are unable to resolve by themselves shall be settled first by mediation and then if not still not resolved then may refer to arbitration in the State of Maharashtra in accordance with centre rules, The Arbitration and Conciliation act.
20. Binding Effect
This Agreement shall be binding upon and inure to the benefit of the Partner and their respective lega representatives, heirs, administrators, executors, successors and permitted assigns.
21. Non-Compete Clause
Every partner shall disclose their ongoing businesses and assets before the incorporation of the partnership, no partner shall engage in a competitive business in accordance with this partnership before prior permission from all the Partners.
22. Severability
If any provision of this Agreement is held to be invalid, illegal or unenforceable in whole or in part, the remaining provisions shall not be affected and shall continue to be valid, legal and enforceable as though the invalid, illegal or unenforceable parts had not been included in the Agreement.
23. Governing Law
The terms of the agreement shall be governed by and construed in accordance with the laws of the State of Maharashtra, India but including its conflicts of law provision. Goods and Services act, Partnership Act, Income tax act, Drugs and Cosmetics act and other acts which have been laid down or will be notified by the centre or the state.
24. Further Assurances
At the written request of one partner, the other Partner(s) shall execute and deliver such other documents and take such other actions as may be reasonably necessary to effect the terms of this agreement.
25. Indemnity
Each Partner shall indemnify another for any personal injury or loss that may have arisen out of the breach of any representation, warranty or covenant of Partnership contained in this Agreement and make necessary arrangements to apply for Indemnity insurances upon incorporation on the Partnership firm.
26. Headings
The section headings herein are for reference purposes only and shall not otherwise affect the meaning, construction and interpretation of any provision in this agreement.
27. Entire Agreement
This Agreement contains the entire understanding between the Partners and supersedes and cancels all prior agreements of the Partners, whether Oral or written, with respect to such subject matter.
28. Counterparts
This agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together, shall constitute the same document.
29. Amendment
This agreement may be amended or modified only by a written agreement signed by all the Partners.
30. Force Majeure Fore-closure
In case of an earthquake, tsunami, storm or a pandemic; if and ‘only if’, the Place of business is directly or indirectly affected, then the Existing Partners shall make necessary provisions with mutual discussions in order to recover the business or dissolve as per clause 12 of the agreement.
31. Notices
Any Notice or other communication given ort made to any Partner under the agreement shall be in writing and hand-delivered, sent by overnight courier service or send by a registered and certified email, return receipt requested, to the address stated above or to another address as that Partner may subsequently designate by notice and shall be deemed given on the date of delivery.
32. Waiver
No partner shall be deemed to have waived any provision of this Agreement or the exercise or any rights held this Agreement unless such waiver. Is made expressly in writing. Waiver by any Partner of a breach or violation of any provision of this Agreement shall not constitute a waiver if any other subsequent breach of violation.
IN WITNESS WHEREOF, the Agreement has been executed and delivered as of the date first written above.
SIGNATURES:
Partner Signature (ABC) Partner Full Name, Address & Contact
Partner Signature (XYZ) Partner Full Name, Address &Contact
Partner Signature (CPL Limited) Partner Full Name, Address & Contact
(CIN:13245234478CL)
DATE:
Witness Signature (1) Witness Full Name, Address & Contact
Witness Signature (2) Witness Full Name, Address & Contact
(STAMP/SEAL FOR KK MEDICALS) DATE:
Drafted by- Karan Khetan (20171658)
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