Simple Partnership Agreement: 2-Page Template for Two-Person Businesses
Updated April 2026. Copy this template, fill in the blanks, and sign. Includes guidance on when a simple agreement is enough.
The Complete 2-Page Template
Copy this template directly. Every [BRACKETED] item needs to be filled in before signing.
Section-by-Section Walkthrough
Section 1: Business Name and Purpose
Be specific about the purpose. 'Technology consulting for healthcare companies' is better than 'consulting.' A broad purpose means partners can take the business in any direction without needing to amend the agreement - which sounds convenient but creates conflict.
Section 2: Capital and Ownership
Document every contribution: cash, equipment, intellectual property, client lists. For non-cash contributions, agree on a dollar value and note it. Ownership percentage should reflect the total value of contributions, not just cash. If Partner 1 contributes $50,000 cash and Partner 2 contributes their client book valued at $50,000, both own 50%.
Section 3: Profits and Losses
The split does not have to match ownership percentage. Partners sometimes agree to a different operating split (e.g., 60/40 for profits) than the ownership split (e.g., 50/50 for the business's equity value). This is legal but make sure both are documented clearly.
Section 4: Management
The $[X,XXX] threshold is critical. Set it high and either partner can make large commitments without consultation. Set it low and you create bottlenecks. Typical ranges: $1,000 to $5,000 for small businesses, $5,000 to $25,000 for larger ones.
Section 5: Partner Exit
Choose your valuation method carefully. Book value (assets minus liabilities) often undervalues a profitable business. A multiple of earnings is more accurate but requires calculating EBITDA. Fair market appraisal is most accurate but costs $3,000 to $10,000. For a simple agreement, a formula method works well: '3x average annual net profit for the prior 2 years.'
Section 7: Dissolution
Keep it simple here. The key is the asset distribution order: debts first, capital return second, then split any remainder by profit percentages. Do not promise partners a specific distribution amount - it depends on what is left after liabilities are paid.
Simple Agreement vs Comprehensive Agreement
| Factor | Simple (2-page) | Comprehensive (10-20 pages) |
|---|---|---|
| Business value | Under $250,000 | Over $250,000 |
| Number of partners | 2 partners | 3+ partners |
| IP assets | None or minimal | Significant software, patents, brand |
| Employees | No employees | Has employees or plans to hire |
| Outside investors | Partners only | Has or seeks outside investment |
| Risk level | Low personal liability exposure | Physical locations, regulated industry, high debt |
What a Simple Agreement Does NOT Protect You From
Personal Liability
A general partnership agreement provides zero liability protection. Both partners are personally liable for all business debts and legal judgments. Only an LLC or LP structure protects personal assets.
Death or Disability
This simple template does not address what happens if one partner dies or becomes disabled. Without those provisions, the partnership automatically dissolves in most states.
Non-Compete Enforcement
A simple agreement without a detailed non-compete clause leaves you vulnerable if a departing partner immediately starts a competing business and takes clients.
Intellectual Property
If your business creates software, designs, or brand assets, a simple agreement's IP provisions are insufficient. You need specific assignment language and work-for-hire clauses.
3-Partner and 4-Partner Variations
For 3+ partners, adjust the template as follows:
FAQ
What should a simple partnership agreement include?
A simple partnership agreement should at minimum include: partner names, business name and purpose, capital contributions and ownership percentages, profit and loss split, management authority, partner exit process, and dissolution terms. Even a two-page agreement covering these basics is vastly better than no agreement.
Is a simple partnership agreement legally binding?
Yes, a simple partnership agreement is legally binding if signed by all partners with clear intent to be bound. It does not need to be notarized or filed with any government agency. A one-page agreement signed by both partners is enforceable in court as long as it contains the essential terms.
What does a simple agreement not protect you from?
A simple partnership agreement does not protect you from personal liability for business debts (only LLC or LP structure does that), does not address disability or death, and may not have detailed buyout valuation formulas for high-value businesses. It is protection for common disputes, not a comprehensive legal shield.
Ready for a More Complete Agreement?
Use our interactive builder to generate a comprehensive agreement tailored to your partnership. Or have an attorney review and expand this simple template.