Economic Partnership Agreement Template

An Economic Partnership Agreement is a legal document that allows one party to receive a defined share of a business’s net profits without receiving equity, voting rights or management authority. It is a contractual arrangement focused solely on economic participation and expressly disclaims the creation of any partnership, joint venture or fiduciary relationship.

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Economic Partnership Agreement defining profit participation rights without ownership, equity or management control

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Frequently asked questions

The Economic Partnership Agreement is a legal contract used to grant one party the right to participate in the economic performance of a business without acquiring ownership, equity, management authority or control. This agreement establishes a contractual profit participation arrangement only and expressly states that no legal partnership, joint venture, agency, fiduciary or employment relationship is created. It defines the participation percentage, calculation of net profits, payment schedule, audit rights, confidentiality obligations, tax treatment, termination terms and limitations on liability.
The agreement is completed by the business owner and the participating party. Each party provides identifying information, agrees on the profit participation percentage, payment schedule and term and signs the agreement to confirm acceptance of the economic arrangement.
Once executed, the agreement is retained by both parties as part of their legal and financial records. It is not filed with a government agency, though it may be referenced for tax reporting, audits or dispute resolution.

Economic Partnership Agreement Template

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