Legal Draft Articles

LEGAL DRAFT ARTICLES

This Draft Articles of Agreement (the "Articles") is made and entered into as of Effective Date: by and between First Party Name: with address First Party Address: , and Second Party Name: with address Second Party Address: .

RECITALS

WHEREAS, the Parties desire to prepare and adopt a set of definitive articles governing the formation, governance, rights and obligations of the business entity or contractual arrangement contemplated by these Draft Articles; and

WHEREAS, the Parties have agreed upon certain principal terms and wish to record the agreed provisions and the process for finalizing, executing and filing the definitive Articles; and

WHEREAS, the Parties intend that upon completion and execution in accordance with the terms herein, the definitive Articles will be adopted and, if required, filed with the appropriate governmental authority to give full force and effect to the entity or contractual arrangement.

NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. DEFINITIONS

1.1 "Articles" means these Draft Articles of Agreement and the final form of articles, certificate or other constituent document executed by the Parties and delivered in accordance with Section 15. Definitions of terms used in these Articles shall be given their plain and ordinary meaning unless otherwise defined herein.

2. PURPOSE AND SCOPE

2.1 The purpose of these Draft Articles is to set forth the principal terms governing formation, governance, capital, management and other material rights and obligations for the proposed entity or contractual arrangement contemplated by the Parties.

2.2 Scope of Draft: The Parties intend that the final Articles will address in detail: capital contributions; allocation of profits and losses; management and voting rights; transfer restrictions; dissolution; and such ancillary matters as are customary and necessary to implement the Parties' agreement.

3. PROPOSED ENTITY TYPE

The proposed Articles contemplate formation of the following entity type (select one or more as appropriate): Corporation Limited Liability Company Partnership Other

4. SUMMARY OF DRAFT ARTICLES

5. CAPITAL CONTRIBUTIONS AND ALLOCATIONS

5.1 Each Party's initial capital contribution, the form thereof and the schedule for contributions shall be as set forth below. Contributions may be cash, property, services rendered, promissory notes or other agreed consideration. Failure to make a required contribution shall constitute a material breach entitling the non-breaching Party to seek specific performance or damages.

6. MANAGEMENT, VOTING AND RESERVED MATTERS

6.1 Management: Unless otherwise provided in the final Articles, management authority shall be vested in the Managing Member(s) or Board of Directors as applicable. The initial managers or directors shall be selected as follows:

6.2 Voting Thresholds: Except as otherwise specified in the final Articles, ordinary decisions shall be by majority vote and fundamental or reserved matters shall require the unanimous written consent of the Parties or the supermajority specified below.

7. AMENDMENT; WAIVER

7.1 Amendment Procedure: These Draft Articles may be amended only by a written instrument signed by both Parties which expressly states that it is an amendment to these Draft Articles. No oral waiver or modification shall be effective.

7.2 Waiver: A waiver by either Party of any breach or default shall not constitute a waiver of any other or subsequent breach or default. Any waiver must be in writing and signed by the waiving Party.

8. REPRESENTATIONS AND WARRANTIES

Each Party represents and warrants to the other that: (a) it has full power and authority to enter into and perform its obligations under these Draft Articles; (b) the execution and delivery of these Draft Articles and the performance hereunder have been duly authorized by all requisite action; and (c) these Draft Articles constitute a valid and binding obligation enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws.

9. INDEMNIFICATION

Each Party shall indemnify, defend and hold harmless the other Party from and against any and all losses, liabilities, claims, damages and expenses (including reasonable attorneys' fees) arising out of or resulting from any breach of its representations, warranties or covenants contained in these Draft Articles, except to the extent caused by the gross negligence or willful misconduct of the indemnified Party.

10. NOTICES

All notices, requests, demands and other communications required or permitted under these Draft Articles shall be in writing and shall be deemed to have been duly given when delivered personally, sent by nationally recognized overnight courier, or mailed by certified mail, return receipt requested, to the addresses provided by the Parties below or at such other address as a Party may designate by notice in accordance with this Section.

11. GOVERNING LAW

These Draft Articles and any dispute arising out of or relating to these Draft Articles shall be governed by and construed in accordance with the laws of the State of without regard to its conflicts of law principles.

12. ENTIRE AGREEMENT

These Draft Articles, together with any exhibits or schedules specifically referenced herein, constitute the entire agreement between the Parties with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the Parties.

13. SEVERABILITY

If any provision of these Draft Articles is held to be invalid, illegal or unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect and shall be construed so as to effectuate the intent of the Parties to the greatest extent permitted by law.

14. COUNTERPARTS; ELECTRONIC SIGNATURES

This instrument may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. Signatures transmitted by facsimile, electronic image or other electronic means shall be treated as original signatures for all purposes.

15. EFFECTIVE DATE AND FILING

15.1 Effective Date: These Draft Articles shall become effective on the Effective Date set forth above or on such later date as the Parties may agree in writing.

15.2 Filing and Fees: The Party responsible for preparing and filing the definitive Articles with any governmental authority shall be: . All fees and expenses associated with filing shall be borne as follows: .

16. CERTIFICATION

Each Party certifies that the information contained in these Draft Articles is true and correct to the best of its knowledge, that it is authorized to enter into these Draft Articles, and that execution of these Draft Articles will bind such Party to the obligations herein.

Sign Now