Partnership Agreement Sample in Nepali

INSTITUTIONAL PARTNERSHIP AGREEMENT

DOCUMENT ID: PA-NPL-202X-V1.0
EFFECTIVE DATE: [Effective Date]
VERSION: 1.0
GOVERNING JURISDICTION: Nepal (Federal Democratic Republic of Nepal)
APPLICABLE STATUTES: National Civil Code (Muluki Civil Code, 2074), Partnership Act (Sahabhagita Ain, 2020) and Companies Act, 2063 of Nepal.

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1. STATUTORY & LEGAL COMPLIANCE NOTICE

THIS INSTITUTIONAL PARTNERSHIP AGREEMENT IS DRAFTED TO COMPLY WITH THE LAWS OF NEPAL, SPECIFICALLY THE MULUKI CIVIL CODE, 2074 AND THE PARTNERSHIP ACT, 2020. LEGAL COUNSEL IN NEPAL SHOULD REVIEW THIS INSTRUMENT PRIOR TO EXECUTION TO ENSURE ALIGNMENT WITH SPECIFIC INDUSTRY REGULATIONS, TAX REGISTRATION MANDATES (PAN/VAT WITH THE INLAND REVENUE DEPARTMENT OF NEPAL), AND FOREIGN INVESTMENT/TECHNOLOGY TRANSFER APPROVALS (IF APPLICABLE UNDER THE FOREIGN INVESTMENT AND TECHNOLOGY TRANSFER ACT - FITTA, 2075). THIS DOCUMENT DOES NOT CONSTITUTE TAX OR REGULATORY ADVICE.

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2. PARTIES & RECITALS

This Partnership Agreement (hereinafter the "Agreement") is entered into and made effective as of [Effective Date] (the "Effective Date"), by and between:

1. [Partner A Full Legal Name], a registered entity / individual under the laws of Nepal, having its principal place of business / residence at [Principal Address], represented herein by [Authorized Representative Name], [Title] (hereinafter referred to as "Partner A", which expression shall unless repugnant to the context include its successors and permitted assigns); and

2. [Partner B Full Legal Name], a registered entity / individual under the laws of [Country/Jurisdiction], having its principal place of business / residence at [Principal Address], represented herein by [Authorized Representative Name], [Title] (hereinafter referred to as "Partner B", which expression shall unless repugnant to the context include its successors and permitted assigns).

Partner A and Partner B may collectively be referred to as the "Parties" and individually as a "Party."

RECITALS:

WHEREAS, the Parties desire to form a strategic business partnership for the purpose of [Detailed Description of Partnership Purpose, e.g., joint development, marketing, and distribution of technology services within Nepal and international markets];

WHEREAS, the Parties intend to pool their respective resources, expertise, capital, and operational capabilities to execute the scope of operations defined herein; and

WHEREAS, the Parties desire to formalize their mutual rights, duties, financial obligations, and governance structures under the legal framework of Nepal.

NOW, THEREFORE, in consideration of the mutual covenants, promises, and considerations set forth herein, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

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3. EXHAUSTIVE OPERATIVE CLAUSES & LEGAL TERMS

SECTION 1: NAME, PLACE OF BUSINESS, AND PURPOSE

1.1 Name: The business of the partnership shall be conducted under the firm name of [Partnership Business Name], or such other name as the Parties may mutually determine in writing, subject to registration requirements under the Office of the Company Registrar (OCR) or local municipal authorities of Nepal, if applicable.
1.2 Principal Place of Business: The principal place of operations of the partnership shall be located at [Physical Address in Nepal or International Location], with secondary offices established as necessary upon mutual consent.
1.3 Purpose: The exclusive purpose of this partnership is to engage in [Specific Business Scope] and any other lawful business activities ancillary or incidental thereto, as mutually agreed upon by the Management Committee.

SECTION 2: TERM & COMMENCEMENT

2.1 Commencement: This Agreement shall commence on the Effective Date first written above and shall continue in full force and effect for a period of [Number, e.g., 5 (Five)] years, unless terminated earlier in accordance with the provisions of Section 5 herein.
2.2 Renewal: Upon expiration of the initial term, this Agreement may be renewed for successive periods of [Number] years upon the unanimous written consent of all Parties executed at least ninety (90) days prior to the expiration date.

SECTION 3: CAPITAL CONTRIBUTIONS & FINANCIAL MANAGEMENT

3.1 Initial Capital Contribution: Each Party shall contribute cash, assets, intellectual property, or professional services as set forth in Schedule A attached hereto. The total initial capital contribution of Partner A shall be valued at [Amount in NPR/USD], and Partner B shall contribute [Amount in NPR/USD].
3.2 Additional Capital: If the partnership requires additional capital to achieve its operational objectives, the Parties shall contribute such additional funds in proportion to their respective profit-sharing ratios, or as otherwise agreed in writing.
3.3 Bank Accounts: All partnership funds shall be deposited in designated commercial bank accounts opened in the name of the partnership within Nepal (or offshore, subject to Nepal Rastra Bank foreign exchange regulations). Dual authorization signatures from designated representatives of both Partner A and Partner B shall be required for any expenditure exceeding [Amount in NPR/USD].

SECTION 4: PROFIT AND LOSS DISTRIBUTION

4.1 Allocation Ratio: All net profits and net losses of the partnership shall be shared and borne by the Parties in the following proportions:

• Partner A: [Insert Percentage, e.g., 50%]
• Partner B: [Insert Percentage, e.g., 50%]
  4.2 Distribution Schedule: Net distributable profits, if any, shall be calculated at the end of each fiscal year (pursuant to the Nepali fiscal year ending Ashad 32, or the Gregorian calendar year as applicable) and distributed within sixty (60) days following the approval of the audited financial statements.

SECTION 5: MANAGEMENT, GOVERNANCE & DECISION MAKING

5.1 Management Authority: The management and control of the partnership shall be vested jointly in the Parties. Major operational, financial, and strategic decisions shall require unanimous consent.
5.2 Day-to-Day Operations: Day-to-day administration shall be delegated to [Name/Title], who shall act as the Managing Director/Operations Head, subject to the oversight of the Parties.
5.3 Books of Accounts: Accurate, complete, and transparent books of accounts shall be maintained at the principal place of business in accordance with Nepal Accounting Standards (NAS) and International Financial Reporting Standards (IFRS) where applicable. Each Party shall have unrestricted access to inspect and audit said books at all reasonable times.

SECTION 6: SCOPE OF SERVICES & OPERATIONAL OBLIGATIONS

6.1 Obligations of Partner A: Partner A shall be responsible for [Detailed operational responsibilities within Nepal, e.g., regulatory compliance, local staffing, government liaison, and domestic marketing].
6.2 Obligations of Partner B: Partner B shall be responsible for [Detailed international/technical responsibilities, e.g., technology transfer, software architecture, global client acquisition, and capital funding].
6.3 Standard of Performance: Both Parties covenant to perform their respective obligations with the highest standards of professional diligence, industry best practices, and in strict compliance with all applicable municipal, provincial, and federal laws of Nepal.

SECTION 7: COMPENSATION, INVOICING & PAYMENT TERMS

7.1 Service Fees / Compensation: Where services are rendered between the Parties outside standard profit distributions, invoices shall be raised in accordance with Schedule B.
7.2 Invoicing & Payment: Invoices shall be paid within [Number, e.g., 30] days of receipt. Payments shall be remitted via wire transfer to the designated bank account free of any deductions or withholding taxes, unless mandated by the Income Tax Act, 2058 of Nepal.
7.3 Late Interest: Any overdue payments shall accrue interest at the rate of [Number, e.g., 1.5%] per month, or the maximum rate permitted by the laws of Nepal, calculated from the due date until the date of actual receipt.

SECTION 8: TERM & TERMINATION

8.1 Termination for Convenience: Either Party may terminate this Agreement for convenience by providing at least [Number, e.g., 90] days prior written notice to the other Party.
8.2 Termination for Cause: Either Party may terminate this Agreement immediately upon written notice if:

• (a) The other Party commits a material breach of any provision of this Agreement and fails to cure such breach within thirty (30) days of receiving written notice specifying the breach.
• (b) The other Party becomes insolvent, files for bankruptcy, enters into liquidation, or ceases to carry on business.
• (c) Any license, permit, or statutory approval necessary for the operation of the partnership is revoked by the Government of Nepal or regulatory authorities.
  8.3 Winding Up: Upon termination, the partnership shall enter a winding-up phase. Assets shall be liquidated, liabilities settled, and remaining capital and surplus distributed in accordance with the Parties' capital and profit-sharing ratios.

SECTION 9: INTELLECTUAL PROPERTY & WORK MADE FOR HIRE

9.1 Pre-Existing IP: Each Party retains exclusive ownership of all intellectual property, trademarks, patents, software code, and proprietary methodologies owned or created prior to the Effective Date ("Pre-Existing IP").
9.2 Jointly Developed IP: All intellectual property, works, designs, inventions, and derivative works created jointly by the Parties in the course of executing this partnership ("Project IP") shall be jointly owned by the Parties, unless otherwise specified in writing.
9.3 License Grant: Each Party grants the other a non-exclusive, royalty-free, revocable license to use its Pre-Existing IP solely to the extent necessary to fulfill the operational scope of this Agreement.

SECTION 10: MUTUAL CONFIDENTIALITY & NON-DISCLOSURE

10.1 Confidential Information: "Confidential Information" includes all non-public, proprietary information, financial data, trade secrets, customer lists, and technical specifications disclosed by one Party to the other, whether orally or in writing.
10.2 Obligations: The receiving Party shall maintain the strict confidentiality of all Confidential Information, using the same degree of care it uses for its own proprietary information (but no less than reasonable care), and shall not disclose it to any third party without prior written consent, except to employees and legal advisors who have a need to know and are bound by equivalent confidentiality obligations.
10.3 Exclusions: Confidentiality obligations shall not apply to information that is publicly known, already in the possession of the receiving Party, or independently developed without reference to the disclosing Party’s information.

SECTION 11: REPRESENTATIONS & WARRANTIES

11.1 Mutual Warranties: Each Party represents and warrants that:

• (a) It is duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation/formation.
• (b) It has full corporate power and authority to execute, deliver, and perform its obligations under this Agreement.
• (c) The execution and performance of this Agreement do not violate any existing contracts, statutory mandates, or court orders binding upon such Party.

SECTION 12: LIMITATION OF LIABILITY & INDEMNIFICATION

12.1 Limitation of Liability: Except for liability arising from gross negligence, willful misconduct, breach of confidentiality, or infringement of intellectual property rights, neither Party shall be liable to the other for any indirect, incidental, consequential, special, or punitive damages, including loss of profits or business interruption.
12.2 Indemnification: Each Party agrees to defend, indemnify, and hold harmless the other Party, its officers, directors, employees, and agents from and against any third-party claims, liabilities, losses, damages, or costs (including reasonable legal fees) arising out of or resulting from the indemnifying Party’s material breach of this Agreement, negligence, or willful misconduct.

SECTION 13: DISPUTE RESOLUTION & ARBITRATION

13.1 Negotiation: In the event of any dispute, controversy, or claim arising out of or relating to this Agreement, the Parties shall first attempt in good faith to resolve the matter through senior management negotiations within thirty (30) days of written notice by either Party.
13.2 Arbitration: If the dispute is not resolved through negotiation, it shall be finally settled by binding arbitration in accordance with the Arbitration Act, 2055 (1999) of Nepal. The arbitration shall be conducted by a sole arbitrator (or a panel of three arbitrators, if agreed) appointed mutually by the Parties. The seat and venue of arbitration shall be [Kathmandu, Nepal], and the proceedings shall be conducted in the English language. The award rendered by the arbitrator(s) shall be final and binding upon both Parties.

SECTION 14: GOVERNING LAW & JURISDICTION

14.1 Governing Law: This Agreement, and all claims or causes of action arising out of or relating to it, shall be governed by, construed, and enforced in accordance with the substantive laws of the Federal Democratic Republic of Nepal, without regard to its conflict of laws principles.
14.2 Jurisdiction: Subject to Section 13, the Parties irrevocably submit to the exclusive jurisdiction of the competent courts located in [Kathmandu District Court / Patan High Court], Nepal, for any legal action or proceeding arising out of this Agreement.

SECTION 15: MISCELLANEOUS PROVISIONS

15.1 Severability: If any provision of this Agreement is held to be invalid, illegal, or unenforceable by a court of competent jurisdiction, such provision shall be modified to the minimum extent necessary to make it valid and enforceable, and the remaining provisions shall remain in full force and effect.
15.2 Entire Agreement: This Agreement, including any attached Schedules and Exhibits, constitutes the entire agreement between the Parties concerning the subject matter hereof and supersedes all prior oral or written negotiations, commitments, and understandings.
15.3 Amendments: No modification, amendment, or waiver of any provision of this Agreement shall be effective unless executed in writing and signed by authorized representatives of both Parties.
15.4 Force Majeure: Neither Party shall be liable for any failure or delay in performance under this Agreement resulting from events beyond its reasonable control, including acts of God, natural disasters (earthquakes, floods), pandemic, civil unrest, war, strikes, or governmental restrictions, provided that the affected Party gives prompt written notice and uses commercially reasonable efforts to resume performance.
15.5 Counterparts: This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed counterpart by electronic mail (PDF or digital signature) shall be as effective as manual delivery of an original.

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4. EXECUTION & FORMAL SIGNATURE BLOCKS

IN WITNESS WHEREOF, the Parties hereto have caused this institutional Partnership Agreement to be duly executed by their respective authorized signatories as of the Effective Date first written above.

FOR [PARTY A / COMPANY NAME]:

Signature: _____________________________________
Printed Name: [Authorized Signatory Name]
Title: [Title / Role]
Company: [Company Legal Name]
Date: [Date]

FOR [PARTY B / CLIENT / COUNTERPARTY]:

Signature: _____________________________________
Printed Name: [Authorized Signatory Name]
Title: [Title / Role]
Company: [Company Legal Name]
Date: [Date]

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5. STEP-BY-STEP EXECUTION & FILING GUIDE

1. Review and Data Population: Open this document in Microsoft Word or Google Docs. Perform a global find-and-replace or manual substitution for all bracketed terms (e.g., [Effective Date], [Company Full Legal Name], [Amount in USD/NPR]). Ensure all financial figures and profit-sharing percentages equal exactly 100%.
2. Legal & Tax Verification: Have local legal counsel in Nepal review the finalized draft to ensure compliance with the latest amendments to the Partnership Act, Company Act, and tax filing requirements with the Inland Revenue Department (IRD).
3. Signatory Authority Verification: Verify that the individuals executing the agreement on behalf of both corporate entities possess proper legal authority (e.g., Board Resolution, Power of Attorney, or Articles of Association authorization).
4. Execution Protocol:
   • Execute via wet-ink signatures across two physical counterparts (one for each party), or utilize verified digital execution platforms (e.g., DocuSign, Adobe Sign) in compliance with the Electronic Transactions Act, 2063 of Nepal.
   • If executed in Nepal, ensure proper stamping (Revenue Stamps / Tikat) is affixed in accordance with the Stamp Duty Act of Nepal, where applicable.
5. Record Retention: Store the fully executed PDF and original physical counterparts in secure institutional document management systems. Retain records for a minimum of seven (7) years following the termination of the partnership for audit and tax compliance purposes.