Is an electronic signature valid?

Yes. Electronic signatures are legally valid under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided intent, consent, attribution, and record retention requirements are met.

When do I need a notary or witnesses?

Most business agreements do not require notarization or witnesses, but state-specific formalities apply for deeds, certain powers of attorney, or documents intended for recording; check state rules before execution.

What signer authentication is recommended?

Use at least email authentication or SMS codes for most commercial agreements; stronger identity proofing or multi-factor authentication is recommended when regulatory compliance or high-value transfers are involved.

Can the agreement be amended electronically?

Yes, if the amendment follows the same execution formalities specified in the original agreement and meets ESIGN/UETA requirements for intent, consent, attribution, and retention.

How do I revoke or cancel the agreement?

Follow termination or rescission provisions in the agreement. Where no provision exists, consult counsel; unilateral revocation may not be effective without mutual consent or court order.

Where should I store the executed document?

Keep the original executed copy in the corporate minute book and a digitally signed, tamper-evident copy in secure storage with access controls and audit logs for retention and eDiscovery readiness.

Electronic Signature
Templates
Miscellaneous
Business Companies Agreement

Business Companies Agreement

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

BUSINESS COMPANIES AGREEMENT

This Business Companies Agreement ("Agreement") is made and entered into as of Effective Date: by and between the parties identified below.

Parties

Company A Name: Company A Address for Notices: Company A Primary Contact (Name, Title): Company B Name: Company B Address for Notices: Company B Primary Contact (Name, Title):

WHEREAS

WHEREAS, Company A is engaged in the business of providing goods and services in the ordinary course of business and has the expertise and capacity to perform the services described herein; and

WHEREAS, Company B desires to procure those goods and services from Company A on the terms and conditions set forth in this Agreement; and

WHEREAS, the parties desire to set forth their respective rights and obligations with respect to the provision of such goods and services.

Scope of Work

Company A shall perform the services and deliverables described below in a professional and workmanlike manner in accordance with industry standards. The scope may be modified only by a written change order signed by authorized representatives of both parties.

Detailed Scope of Work:

Payment Terms

In consideration for the performance of services and delivery of any goods under this Agreement, Company B shall pay Company A as set forth below. All payments are due in United States dollars unless otherwise agreed in writing.

Total Compensation: Payment Schedule (milestones, dates, or invoice cadence): Late Payment Fee:

Unless otherwise provided in writing, Company A shall invoice Company B in accordance with the payment schedule. Payment is due within thirty (30) days of Company B's receipt of an undisputed invoice. Disputed amounts must be raised in writing within fifteen (15) days of receipt of invoice and the parties shall work in good faith to resolve such disputes.

Term and Termination

This Agreement shall commence on Start Date: and shall continue until End Date: unless earlier terminated in accordance with this Agreement.

Either party may terminate this Agreement for convenience upon written notice to the other party given at least days prior to the effective date of termination. Either party may terminate this Agreement immediately upon written notice if the other party materially breaches any obligation hereunder and fails to cure such breach within thirty (30) days after receipt of written notice specifying the breach.

Confidentiality

For purposes of this Agreement, "Confidential Information" means all non-public information disclosed by a disclosing party to the receiving party that is designated as confidential or that reasonably should be understood to be confidential given the nature of the information and the circumstances of disclosure. Confidential Information includes, without limitation, business plans, customer lists, pricing, technical data, designs, and specifications.

The receiving party shall: (a) maintain the confidentiality of the Confidential Information using at least the same degree of care it uses to protect its own confidential information but in no event less than reasonable care; (b) not disclose Confidential Information to any third party except to its employees, agents, or professional advisors having a need to know and who are bound by confidentiality obligations no less protective than those herein; and (c) use Confidential Information solely to perform its obligations or exercise its rights under this Agreement.

Confidential obligations shall not apply to information that: (i) is or becomes generally available to the public other than by breach of this Agreement; (ii) is rightfully received from a third party without restriction and without breach of an obligation of confidentiality; (iii) is independently developed by the receiving party without use of the disclosing party's Confidential Information; or (iv) is required to be disclosed by law or valid legal process, provided that the receiving party gives prompt notice to the disclosing party to the extent legally permitted.

The confidentiality obligations set forth herein shall survive termination or expiration of this Agreement for a period of years, except that trade secrets shall remain protected for so long as they qualify as trade secret under applicable law.

Indemnification and Liability

Each party shall indemnify, defend and hold harmless the other party from and against any third-party claims, liabilities, damages, losses and expenses (including reasonable attorneys' fees) arising out of or resulting from the indemnifying party's gross negligence, willful misconduct, or breach of its obligations under this Agreement. Except for wilful misconduct or a party's indemnification obligations, neither party's liability to the other for any claim arising under this Agreement shall exceed the total amounts paid or payable by Company B to Company A under this Agreement in the twelve (12) months preceding the claim.

Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of without regard to its conflict of laws principles. The parties submit to the exclusive jurisdiction of the state and federal courts located within that State for any disputes arising out of or in connection with this Agreement.

Entire Agreement

This Agreement, together with any exhibits, schedules or written change orders signed by both parties, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, proposals, negotiations and understandings, whether written or oral. Any amendment or modification of this Agreement must be in writing and signed by authorized representatives of both parties.

Notices

All notices, requests, consents and other communications required or permitted under this Agreement shall be in writing and shall be delivered to the notice address for each party set forth below or to such other address as either party may designate by notice to the other party in accordance with this section.

Notice Address for Company A: Notice Address for Company B:

Miscellaneous Provisions

If any provision of this Agreement is held to be invalid, illegal or unenforceable, the remaining provisions shall remain in full force and effect and the parties shall negotiate in good faith to replace the invalid provision with a valid provision that most closely approximates the parties' original intent. Neither party may assign this Agreement or any rights hereunder without the prior written consent of the other party, except that either party may assign this Agreement in connection with a merger, sale of substantially all assets, or change of control, provided the assignee assumes all obligations hereunder.

Company A Printed Name:

By:

Date:

Company B Printed Name:

By:

Date:

What the Business Companies Agreement Is and when it’s used

A Business Companies Agreement is a formal contract that sets out rights, responsibilities, ownership, decision-making authority, capital contributions, profit allocation, and dispute resolution among business entities or their principals. It commonly governs relationships between founders, members, or shareholders and can function as an operating agreement, shareholder agreement, or joint venture contract depending on structure and purpose. The document defines management roles, transfer restrictions, exit mechanics, and amendment procedures so parties have a clear legal framework for daily operations and long-term events, reducing ambiguity and litigation risk.

Why a clear Business Companies Agreement matters

A well-drafted agreement clarifies governance, protects equity and intellectual property, establishes capital and distribution rules, and sets dispute-resolution pathways. It reduces uncertainty for investors, lenders, and regulators while creating a reference point for operational decisions and successor transactions.

Who typically prepares or signs this agreement

Parties should confirm signing authority and, where required, obtain board or member approvals before execution to ensure the agreement is binding and enforceable.

Founders and equity holders responsible for ownership and governance decisions.
General counsel or outside attorneys who draft and review legal terms.
C-level executives and authorized company officers who execute and enforce the agreement.

Core components to include in a professional agreement

Include clear, unambiguous provisions that address ownership, management, capital, transferability, financial reporting, dispute resolution, and termination to make the agreement operational and enforceable.

Parties

Full legal names, entity types, and state of formation for every party, with EIN or tax ID where relevant to avoid identity disputes.

Capital & Ownership

Describe capital contributions, ownership percentages, equity classes, and procedures for future capital calls or dilution events.

Governance

Set voting rights, board or manager composition, quorum rules, and reserved matters requiring supermajority approval.

Transfer Restrictions

Detail right-of-first-refusal, buy-sell triggers, lockups, and permitted transferees to control ownership changes.

Financials & Reporting

Specify fiscal year, accounting standards, distribution policy, audit rights, and delivery timelines for financial statements.

Exit & Dispute

Include dissolution mechanics, valuation method for buyouts, mediation/arbitration clauses, and choice-of-law provisions.

Step-by-step: completing and executing the agreement

Follow a consistent sequence to prepare, review, approve, sign, and store the executed agreement to reduce errors and ensure legal effectiveness.

01

Drafting: Populate fields, attach schedules, and confirm definitions.
02

Legal Review: Have counsel review for compliance and state-specific requirements.
03

Approval: Secure board or member votes if required and record resolutions.
04

Execution: Obtain authorized signatures, witness/notary if needed, and retain originals.

Configuring a streamlined digital signing workflow

Define field assignments, signer order, and authentication to ensure each signer sees and signs only the permitted sections.

Field \| Configuration	Role-based assignment \| Set per-signer
Signing Order	Sequential or parallel routing
Authentication	Email link, SMS code, or stronger ID
Conditional Fields	Show/hide based on answers
Audit Trail	Capture IP, timestamp, and actions

Typical routing and submission destinations

After execution, determine where copies, filings, and notices must be sent—internal records, registered agent, tax advisor, or state agencies.

Internal Records: Store executed originals with corporate minute book.
Registered Agent: Deliver changes in officers or addresses for state records.
Tax Advisor: Share for proper tax treatment and reporting.
Filing Agency: File required amendments with Secretary of State.

Digital signing and integration essentials

Verify platform compliance for your use case (e.g., HIPAA, 21 CFR Part 11) and record retention capabilities before finalizing workflows.

Formats: PDF, DOCX, and flattened PDF supported
Integrations: Salesforce, NetSuite, Google Workspace available
Authentication: Email, SMS, or stronger methods

Common timelines and filing expectations

Track internal and external deadlines for approvals, filings, and tax reporting after the agreement is executed to avoid penalties and preserve rights.

Effective Date Entry:

Record when obligations begin; affects reporting and notice windows

Board/Member Approval:

Complete prior to execution if bylaws or operating agreement require it

State Filings:

File amendments within state-mandated windows for entity changes

Tax Reporting Triggers:

Report capital contributions or ownership changes to tax advisor promptly

Document Delivery:

Send final executed copies to all parties within 5–10 business days

Common preparation mistakes to avoid

Using informal or ambiguous language that leaves material terms undefined and invites disputes.
Failing to verify signer authority, which can render the agreement unenforceable against the entity.
Neglecting required approvals (board, member resolution) before signing, exposing parties to internal challenge.
Omitting schedules, exhibits, or capitalization tables referenced in the agreement, causing gaps in enforcement.

Practical risks and legal consequences of errors

Invalid Execution: May render contract unenforceable against an entity or third parties

Tax Exposure: Incorrect ownership reporting can trigger IRS adjustments and penalties

Loss of Rights: Poorly drafted transfer restrictions may allow unwanted ownership changes

Regulatory Noncompliance: Failure to meet sector rules (e.g., HIPAA, SEC) can incur fines

Dispute Costs: Ambiguity often leads to expensive litigation or arbitration

Notary/Witness Errors: Missing notarization or witness signatures where required can delay filings

Real-world examples of how agreements are used

Below are two concise examples that show typical scenarios for a Business Companies Agreement.

Founders’ Operating Agreement

Two founders set ownership and voting rights using an operating agreement to avoid deadlock.

The document defined vesting and buyback mechanics.
When a founder departed, the pre-agreed buy-sell process transferred equity smoothly and prevented litigation by following valuation procedures.

Joint Venture for Development

Two companies created a joint venture to develop a product, allocating IP and revenue shares.

The agreement included milestone payments and IP assignment.
At project completion the JV wound up and distributions were made per the predefined waterfall, minimizing post-project disputes.

eSignature vendor comparison for executing the agreement

Compare entry-level pricing and common capabilities that matter when selecting an eSignature provider for Business Companies Agreements; signNow is listed first per platform comparisons.

	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 plan	Varies by plan	Varies by plan	Varies by plan
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No cap	100 envelopes/user/year	Varies	Varies	Varies

Frequently asked questions about execution and enforceability

Answers to common questions about signing, witnesses, notarization, amendments, and electronic execution under U.S. law.

Need help? Contact support

Is an electronic signature valid?
Yes. Electronic signatures are legally valid under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided intent, consent, attribution, and record retention requirements are met.
When do I need a notary or witnesses?
Most business agreements do not require notarization or witnesses, but state-specific formalities apply for deeds, certain powers of attorney, or documents intended for recording; check state rules before execution.
What signer authentication is recommended?
Use at least email authentication or SMS codes for most commercial agreements; stronger identity proofing or multi-factor authentication is recommended when regulatory compliance or high-value transfers are involved.
Can the agreement be amended electronically?
Yes, if the amendment follows the same execution formalities specified in the original agreement and meets ESIGN/UETA requirements for intent, consent, attribution, and retention.
How do I revoke or cancel the agreement?
Follow termination or rescission provisions in the agreement. Where no provision exists, consult counsel; unilateral revocation may not be effective without mutual consent or court order.
Where should I store the executed document?
Keep the original executed copy in the corporate minute book and a digitally signed, tamper-evident copy in secure storage with access controls and audit logs for retention and eDiscovery readiness.

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