Fixed Share Partnership Agreement Template for Australia

The Fixed Share Partnership Agreement is a crucial document used in Australian professional services firms to establish a partnership arrangement where a partner receives a predetermined share of profits rather than a full equity stake. This hybrid model bridges the gap between full equity partnership and employment, making it particularly suitable for firms looking to expand their partnership while managing risk and capital requirements. The agreement details financial arrangements, voting rights, management participation, and professional obligations, all within the framework of Australian partnership law and relevant federal and state/territory legislation. It's commonly used for partner progression, lateral hires, or restructuring existing partnership arrangements, providing a flexible solution that can include conversion paths to full equity partnership.

1. Parties: Identification of all parties entering into the agreement, including the firm and the fixed share partner

2. Background: Context of the agreement, including the nature of the partnership business and the basis for the fixed share arrangement

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules for interpretation

4. Partnership Structure: Overview of the partnership structure, distinguishing between equity and fixed share partners

5. Commencement and Term: Start date, duration, and any renewal provisions of the fixed share partnership

6. Fixed Share Partner Status: Rights, obligations, and limitations of the fixed share partner role

7. Financial Arrangements: Fixed share calculation, profit share mechanisms, and payment terms

8. Capital Contribution: Requirements for capital contribution, if any, and terms for return

9. Management and Decision Making: Partner's voting rights and involvement in management decisions

10. Duties and Obligations: Specific duties, performance requirements, and obligations of the fixed share partner

11. Expenses and Benefits: Treatment of business expenses and partner benefits

12. Professional Indemnity: Insurance requirements and liability provisions

13. Confidentiality: Obligations regarding confidential information and client data

14. Termination: Grounds and process for termination of the fixed share partnership

15. Post-Termination Obligations: Ongoing obligations and restrictions after partnership ends