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Partnership Agreement template

A partnership agreement sets out how two or more people run a business together: what each partner contributes, how profits and losses are shared, how decisions are made, and what happens when a partner leaves.

Replace everything in [BRACKETS], export to PDF, then send it for signature.

1. Parties and Formation

This Partnership Agreement (the "Agreement") is made on [DATE] between the following partners (each a "Partner"): [PARTNER 1 NAME AND ADDRESS]; [PARTNER 2 NAME AND ADDRESS]; [ADD MORE AS NEEDED]. The Partners form a partnership under the name [PARTNERSHIP NAME] (the "Partnership"), effective [EFFECTIVE DATE].

2. Purpose and Place of Business

The purpose of the Partnership is to [DESCRIBE BUSINESS] and any lawful activities related to it. The principal place of business is [BUSINESS ADDRESS], or such other place as the Partners agree.

3. Term

The Partnership begins on the Effective Date and continues [until dissolved under this Agreement / until END DATE].

4. Capital Contributions

Each Partner shall contribute the following initial capital: [PARTNER 1]: [AMOUNT OR PROPERTY AND AGREED VALUE]; [PARTNER 2]: [AMOUNT OR PROPERTY AND AGREED VALUE]. Contributions are due by [DUE DATE]. No Partner is required to make additional contributions unless [the Partners unanimously agree / ADDITIONAL CAPITAL RULE]. No interest is paid on capital contributions.

5. Profits, Losses, and Distributions

Net profits and losses are shared among the Partners in the following percentages: [PARTNER 1]: [PERCENT]%; [PARTNER 2]: [PERCENT]%. Distributions will be made [FREQUENCY, e.g. quarterly] after setting aside reasonable reserves for operating needs, as determined by [a majority / all] of the Partners.

6. Management and Decision-Making

Each Partner has an equal right to participate in the management of the Partnership [ALTERNATIVE: voting in proportion to profit shares]. Ordinary business decisions require the approval of [a majority of] the Partners. The following require unanimous written consent: admitting a new partner; borrowing or guaranteeing more than [AMOUNT]; selling substantially all assets; changing the nature of the business; and amending this Agreement.

7. Duties, Compensation, and Outside Activities

Each Partner shall devote [TIME COMMITMENT, e.g. full working time] to the Partnership and act in good faith and in its best interests. [OPTIONAL: PARTNER NAME shall receive a guaranteed payment of AMOUNT per PERIOD for DUTIES.] A Partner may engage in other business activities that do not compete with the Partnership, [unless the other Partners consent in writing].

8. Books, Records, and Banking

The Partnership shall keep complete books of account at its principal place of business, open to inspection by any Partner. The fiscal year ends on [FISCAL YEAR END]. Partnership funds shall be held in an account in the Partnership's name at [BANK], and withdrawals above [AMOUNT] require the signatures of [NUMBER] Partners.

9. Withdrawal, Death, or Disability of a Partner

A Partner may withdraw by giving [NOTICE PERIOD] written notice to the other Partners. On the withdrawal, death, disability, or bankruptcy of a Partner, the remaining Partners may continue the business and purchase the departing Partner's interest at its fair value as determined by [VALUATION METHOD, e.g. an independent valuer or a formula], payable [PAYMENT TERMS].

10. Dissolution

The Partnership dissolves upon [the unanimous agreement of the Partners / the occurrence of DISSOLUTION EVENTS]. On dissolution, the Partners shall wind up the business, pay all debts, return capital contributions, and distribute any remaining assets in proportion to their profit shares.

11. Dispute Resolution and Governing Law

The Partners shall first try to resolve any dispute through good-faith negotiation, then through [mediation / arbitration] in [LOCATION]. This Agreement is governed by the laws of [GOVERNING LAW JURISDICTION]. It is the entire agreement among the Partners and may only be amended in writing signed by all Partners.

12. Signatures

The Parties agree that this Agreement may be signed electronically and in counterparts, and that electronic signatures have the same effect as handwritten signatures. PARTNER: [PARTNER 1 NAME] Signature: ____________________ Date: [DATE] PARTNER: [PARTNER 2 NAME] Signature: ____________________ Date: [DATE] [ADD SIGNATURE BLOCKS FOR ADDITIONAL PARTNERS]

When to use this template

  • When starting a business with one or more co-owners as a general partnership
  • When partners contribute different amounts of money, property, or time
  • When you want to replace the default partnership rules of your jurisdiction with your own terms
  • When a new partner joins or an existing partner plans to exit

How to fill it in and get it signed

  1. List every partner's legal name and address, the partnership name, and the effective date.
  2. Describe the business purpose and record each partner's capital contribution and its agreed value.
  3. Set profit-sharing percentages, decision rules, and which decisions need unanimous consent.
  4. Agree how a partner can withdraw, how their share is valued, and when the partnership dissolves.
  5. Choose the dispute-resolution method and governing law, then send the agreement to all partners for e-signature via eSignSimple.

This template is general information, not legal advice. Laws differ by country and state; have a lawyer review contracts with high stakes.

Frequently asked questions

Do I need a written partnership agreement?

In many places a partnership can exist without one, but then default statutory rules apply, which may not match what the partners intended. A written agreement makes ownership, profits, and exits clear.

How are profits split in a partnership?

Partners can agree any split, such as equal shares or percentages based on capital or effort. Without an agreement, many jurisdictions default to equal shares.

What is the difference between a partnership and an LLC?

In a general partnership, partners are usually personally liable for business debts. An LLC or similar limited-liability entity typically separates the owners' personal assets from business debts and is governed by an operating agreement.

Can all partners sign the agreement online?

Yes. With eSignSimple you can send the agreement to every partner for e-signature, and signers don't need an account. Each signature is recorded in an audit trail.