A Partnership Agreement is essential for any business with multiple owners. This template defines the relationship between partners, preventing disputes over money, responsibilities, and exit strategies.
What Is a Partnership Agreement?
A partnership agreement is a legally binding contract between two or more business partners that outlines the terms of their business relationship. It defines ownership stakes, profit sharing, management authority, capital contributions, and procedures for significant events like adding partners, resolving disputes, or dissolving the business.
Key Clauses to Include
- Partnership Purpose — Define the business name, registered address, and the purpose/scope of the partnership.
- Capital Contributions — Each partner’s initial investment (cash, property, services) and future contribution obligations.
- Profit/Loss Distribution — How profits and losses are allocated among partners.
- Management — Who has authority to make what decisions. Define voting rights and thresholds for major decisions.
- Partner Roles — Each partner’s responsibilities, time commitment, and restrictions on outside activities.
- Adding/Removing Partners — Process for admitting new partners or handling departures (buyout terms, valuation methods).
- Dispute Resolution — Mediation or arbitration before litigation.
- Dissolution — Under what circumstances the partnership can be dissolved and how assets are distributed.
How to Customize This Template
- Be specific about contributions — Don’t just say “equal.” Each partner’s contribution (capital, skills, contacts) should be valued.
- Define decision-making clearly — What requires unanimous consent vs. majority vote vs. individual authority?
- Include a buyout formula — Define how a departing partner’s share is valued and paid out.
- Add a non-compete clause — Prevent partners from competing with the business during and after the partnership.
How to Send for E-Signature with WPsigner
- Upload — Drag and drop this agreement into WPsigner
- Add fields — Signature and date fields for all partners
- Send — Email secure signing links to each partner
- Track — All partners can sign from anywhere on any device
- Store — Signed agreements are archived with audit trails