Are electronic signatures valid?

Yes. Electronic signatures meet federal ESIGN requirements and state UETA rules when intent, consent, attribution, and reliable record retention are present; see 15 U.S.C. ch. 96 and UETA in most states.

When is notarization required?

Notarization is rarely required for ordinary bilateral contracts but may be needed for deeds, certain powers of attorney, or where a statute requires an acknowledgement; verify based on document type and state law.

How do I confirm signer authority?

Obtain evidence of corporate authority such as board minutes, a corporate resolution, or an officer’s certificate and include signer capacity lines in the signature block.

Can a signed agreement be amended electronically?

Yes. Amendments should be documented in a written amendment or addendum signed by both parties; e-signature methods that meet ESIGN/UETA standards are acceptable.

How long should I keep executed agreements?

Retain for the contract term plus at least three years; longer retention applies for tax, real estate, or healthcare-related records (IRS, HIPAA timelines).

What if a party refuses to sign electronically?

Use a wet-ink signature process, in-person signing, or a notarized document; ensure both parties agree to the method and maintain a clear executed original or certified copy.

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Bilateral Agreement

Bilateral Agreement

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What a Bilateral Agreement Is and When Parties Use It

A Bilateral Agreement is a legally binding contract between two parties that records mutual promises, obligations, and conditions on a specific subject such as sale of goods, services, confidentiality, or licensing. It establishes the rights and duties each side accepts, defines key terms (scope, duration, payment, warranties), and typically includes dispute resolution, governing law, and termination clauses. Properly drafted bilateral agreements reduce ambiguity, allocate risk, and provide an enforceable roadmap for performance and remedies under U.S. contract law.

Why Using a Clear Bilateral Agreement Matters

A clear bilateral agreement creates predictable obligations and reduces dispute risk by documenting mutual intent, performance milestones, and remedies. When coupled with consistent signatory authority and record retention, it supports enforceability and compliance with industry or regulatory requirements.

Who Typically Drafts and Signs Bilateral Agreements

Small businesses, in-house legal teams, procurement officers, independent contractors, and counterparties in commercial transactions commonly prepare and sign bilateral agreements.

Procurement and Purchasing Teams — Negotiate scope, pricing, delivery schedules, and acceptance criteria for vendor relationships.
Legal and Compliance Teams — Draft governing law, indemnity, confidentiality, and regulatory clauses to reduce legal exposure.
Company Executives and Contract Managers — Approve commercial terms, sign on behalf of the entity, and track performance obligations.

Ensure signers have proper corporate authority and that agreements are stored with version control and access logs for future enforcement or audit.

Core Clauses to Include in a Professional Bilateral Agreement

A well-structured bilateral agreement includes specific, concise clauses that allocate risk, set expectations, and permit efficient enforcement if disputes arise.

Parties

Identify full legal names and entity types for both parties, including state of incorporation and a designated contact for notices; use consistent capitalization and spelling.

Scope

Define the work, goods, or services precisely, including deliverables, milestones, acceptance criteria, and any excluded items to prevent scope creep.

Consideration

Specify payment amounts, schedule, invoicing terms, taxes, and what constitutes payment acceptance; tie remedies to late or missed payments.

Term & Termination

State effective and expiration dates, renewal mechanics, and termination rights for cause or convenience with notice requirements and post-termination obligations.

Liability

Allocate risk via indemnities, limitations of liability, and warranty disclaimers; identify any minimum insurance requirements and remedies for breach.

Governing Law

Designate the governing state law and venue for disputes; choose a state with favorable commercial rules or where performance occurs.

Essential Fields and Required Information

Full Legal Names: Use entity or individual name as on legal formation documents

Entity Type: Corporation, LLC, sole proprietor, or individual

Contact Details: Street address, phone, and email for official notices

Effective Date: MM/DD/YYYY format for unambiguous start date

Consideration: Exact dollars or measurable deliverables

Signatory Authority: Signer title and capacity (e.g., CEO, authorized agent)

Step-by-Step: Completing a Bilateral Agreement

Follow these steps in order to draft, confirm, execute, and retain a bilateral agreement consistently and defensibly.

01

Draft: Prepare a clear draft with defined scope, payment, term, and dispute clauses.
02

Review: Legal and business reviewers check authority, liabilities, and regulatory language.
03

Sign: Obtain authorized signatures from both parties; use e-signature or notarization if required.
04

Store: Record executed versions in secure document management with audit trail and retention tags.

Typical Routing and Submission Flow

A standard routing process ensures proper approvals, authenticated signing, and secure delivery of executed copies to stakeholders.

Upload: Originator uploads the agreement and assigns fields for signatures and dates.
Assign Signers: Set signer order and authentication level (email, SMS code, or higher).
Execute: Each party authenticates and signs; system timestamps and logs actions.
Distribute: All executed parties receive a copy plus a certificate of completion or audit trail.

Digital Signing and eSubmission Considerations

When using an eSignature platform for a bilateral agreement, confirm authentication, audit trails, and retention capabilities before sending.

Authentication: Use email+SMS or KBA for higher-assurance signings
Audit Trail: Ensure IP, timestamp, and action logs are recorded
File Formats: Platform should support PDF and DOCX for archival and editing

Verify the vendor supports necessary compliance frameworks (ESIGN/UETA, HIPAA if health data involved, 21 CFR Part 11 for FDA-regulated records) and can export a tamper-evident PDF with a clear audit trail.

Common Timing Elements and Deadlines to Track

Track dates that trigger obligations, renewals, or statutory deadlines to avoid missed performance or notice opportunities.

Effective Date:

Date when obligations and notice windows begin; enter as MM/DD/YYYY.

Performance Milestones:

Dates tied to deliverables, acceptance testing, and payments.

Notice Periods:

Timeframes for cure, breach notice, and termination (e.g., 30 days).

Renewal Deadlines:

Automatic renewal opt-out windows (e.g., 60–90 days prior).

Record Retention Start:

Begin retention from effective date or final payment, per policy.

Common Mistakes to Avoid When Preparing the Agreement

Using nonstandard or vague scope language that allows conflicting interpretations and post-signature disputes.
Failing to confirm signer authority or corporate sign-off, which can render a contract unenforceable.
Omitting clear payment terms or acceptance criteria, producing disagreements on when obligations are met.
Neglecting to specify governing law and venue, which complicates dispute resolution and can increase litigation costs.

Risks and Consequences of an Incomplete or Incorrect Agreement

Contract Voidability: Missing signatory authority may render the agreement void or voidable

Monetary Loss: Unclear payment or warranty terms can cause unrecoverable damages

Regulatory Exposure: Improper handling of regulated data (HIPAA, FERPA) can trigger fines

Enforcement Delays: Ambiguous terms extend dispute resolution and escalate legal fees

Recordkeeping Penalties: Failure to retain records per IRS, SEC, or other rules risks sanctions

Reputational Harm: Contract disputes disrupt customer and partner relationships

Sample eSignature Vendor Comparison for Executing Bilateral Agreements

Comparing vendor pricing and key features helps determine an appropriate eSignature solution for bilateral agreements; signNow appears first in the table as requested.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Available on higher plans	Varies	Varies	Varies	Varies
Audit Trail	Yes	Yes	Yes	Yes	Yes
Envelope Cap	No cap	100 envelopes/user/year limit	Varies	Varies	Varies

Frequently Asked Questions About Bilateral Agreements

Answers to common execution, enforceability, and storage questions for bilateral agreements used in U.S. commerce.

Need help? Contact support

Are electronic signatures valid?
Yes. Electronic signatures meet federal ESIGN requirements and state UETA rules when intent, consent, attribution, and reliable record retention are present; see 15 U.S.C. ch. 96 and UETA in most states.
When is notarization required?
Notarization is rarely required for ordinary bilateral contracts but may be needed for deeds, certain powers of attorney, or where a statute requires an acknowledgement; verify based on document type and state law.
How do I confirm signer authority?
Obtain evidence of corporate authority such as board minutes, a corporate resolution, or an officer’s certificate and include signer capacity lines in the signature block.
Can a signed agreement be amended electronically?
Yes. Amendments should be documented in a written amendment or addendum signed by both parties; e-signature methods that meet ESIGN/UETA standards are acceptable.
How long should I keep executed agreements?
Retain for the contract term plus at least three years; longer retention applies for tax, real estate, or healthcare-related records (IRS, HIPAA timelines).
What if a party refuses to sign electronically?
Use a wet-ink signature process, in-person signing, or a notarized document; ensure both parties agree to the method and maintain a clear executed original or certified copy.

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