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Download partnership agreement template in Microsoft Word format.
Legalize your Partnership with a Partnership Agreement Template
Have you decided to form a business partnership with another party? Do you need a partnership agreement template to validate and legalize this partnership before it officially takes effect? If so, you may find the following information extremely useful. In this article we will briefly explain what a partnership agreement is, and show you what type of language and information should be included on a partnership agreement template.
What Is a Partnership Agreement?
In the business world, there are essentially three types of business models, or more specifically, three ways to own a business. The first of these is a sole proprietorship, a model in which one individual is legally responsible for the business and owns it outright, responsible for both the assets and the debits. Another type of business model is the corporation. In a corporation, shares of stock are sold to the general public, and each share represents a portion of ownership. This is why corporations are often referred to as publicly-held or publicly-owned companies. The last type of business ownership, and the topic of this article, is the partnership. A partnership is similar to a sole proprietorship, but instead of one owner assuming the legal responsibility of the business, that responsibility is held by two parties equally. Thus, a partnership agreement form is a document that specifically lays out the terms of the partnership, later to be signed by both parties involved.
What Should You Look For in a Partnership Agreement Template?
If you’re searching for a partnership agreement template online, you may find they are readily available on many business-related websites, and while most of them are similar in nature, they differ slightly depending on the type of business and the terms of the agreement. Generally speaking, though, a good partnership agreement template should contain all of the following:
• Names and Date. At the top of the template, the names of both parties entering into the partnership should be recorded, along with the date the agreement takes effect.
• Business Name and Function. The name that both parties choose for the business, and the specific function of the business—products sold, service offered, etc.—should come next on the form, including the principal address where the primary office of the business will be located.
• The Term of the Partnership. The date of when the partnership will take effect, along with the specific term of the partnership—2 years, until death, etc.—should be included next.
• How the Responsibilities and Profits Will Be Divided. The next part of the template should specifically outline how all of the responsibilities and profits of the partnership will be divided. This includes things like banking, books, capital disbursement and management duties.
• Death. The last part of the agreement should be a description of how the partnership will be handled should one of the partners die during the course of the term.
• Signatures. Naturally, the agreement should be signed by both parties, thus making it legal in the eyes of the law.
While partnership agreement templates are usually not that difficult to find (sometimes you can locate one free of cost) they should contain, at minimum, the items and language mentioned above in order to cover all the bases and make the document legal and binding.