This document is a clause which can be inserted into an existing partnership agreement.
When setting up a partnership, it is worth considering whether the partnership wishes to include goodwill into the value of the business. This has accounting ramifications as well as ramifications on the sale of shares in a partnership.
This clause is drafted for the valuation of a partner’s share in the partnership on expulsion or retirement. If required, and with appropriate modifications, this clause can apply to valuation of a share on death of a partner.
Using this precedent
This is a general clause which can be inserted into a partnership agreement. The clause can also be added to the “continuing the partnership” provisions in the precedent “Partnership agreement (short form, general)”.
When inserting this optional clause into an agreement, care must be taken to ensure that the agreement remains consistent. Cross-references, definitions and schedules should all be checked.
This document has been authored for LexisNexis by Michael Heraghty, Partner, TressCox Lawyers, Rosemarie Ryan, Barrister and Elise Margow, Principal Legally Speaking
This document is prepared with the assistance of Specialist Editor Stephen Newman, Executive Counsel, Ponte Earle.