Free Partner Buyout Agreement Template

What is a partner buyout agreement?

A partner buyout agreement records the terms on which one partner in a business partnership buys the other's share. It turns a handshake about "you keep the business, I take the money" into clear promises: exactly what share is sold and when the departing partner leaves, the price and whether it is paid in one go or in instalments with interest, who is responsible for the partnership's debts, how the handover of clients, records and bank mandates works, and a release so neither partner can bring old claims later.

This template is built for two-partner businesses and small partnerships where one partner continues the business. It covers the sale of the interest, price and payment (including what happens if an instalment is missed), whether profits up to closing are paid separately, the buying partner taking on the debts with an indemnity (and any debts that stay with the departing partner), getting the departing partner released from loans, leases and personal guarantees, filings and notices, use of the business name, an optional non-solicitation promise, and a mutual release once the price is paid.

Best for: Two-partner businesses and small partnerships where one partner continues the business
Signed by: The buying partner and the departing partner
Payment: In full at closing, or part at closing and the rest in instalments, with optional interest
Length: 2–3 pages, initialled on every page

When to Use a partner buyout agreement

A co-owner of a landscaping or trade business retires and the other partner keeps running it
Two partners in a consultancy part ways and one buys out the other's 50% share
A partner relocates and sells their share to the remaining partner in instalments
Partners disagree on the direction of the business and agree a clean exit
A family business partnership where one sibling buys out another

What You Fill In

21 blanks, then the name and email of each person who signs: buying partner, departing partner.

1 The partnership

Date of this agreement*
Partnership (business name)*
Partnership's business address
Date of the written partnership agreement
Share being sold*

2 The partners

Buying partner's full name*
Buying partner's address
Departing partner's full name*
Departing partner's address

3 Price and payment

Closing date (the partner leaves)*
Currency*
Total purchase price*
Amount paid on the closing date
How the rest is paid
Interest on the unpaid balance
Pay the departing partner's share of profits up to closing by

4 Debts and handover

Debts that stay with the departing partner
Handover period after closing (days)*
Duties and relationships to hand over

5 Other terms

No soliciting clients or staff for (months)
Governing law*

6 Who signs

Buying partner signature and date, initials on every page · The partner buying the other's share and continuing the business.
Departing partner signature and date, initials on every page · The partner selling their share and leaving the partnership.

Using the partner buyout agreement, step by step

1 Check your partnership agreement first

If you have a written partnership agreement, it may already set out how a leaving partner's share is valued and paid. Enter its date; this buyout agreement then replaces that procedure for this buyout, so make sure both partners are happy with that.

2 Describe the share and set the price

Describe the departing partner's whole share as your agreement or accounts do (for example, a 50% interest in capital, profits and losses), then enter the price and the closing date. For instalments, enter the amount paid at closing and the schedule for the rest, plus any interest rate.

3 Decide about debts and profits

By default the buying partner takes on every partnership debt and indemnifies the departing partner. List any debts that should stay with the departing partner. Choose whether their share of profits up to closing is included in the price or paid separately once the accounts are finalised.

4 Plan the handover and sign

Set the handover period and anything specific to hand over, and decide whether to include a time-limited promise not to solicit clients or staff. Then add both partners as signers — VergeHR places both signature blocks and initials on every page.

Tips Before You Send It

Creditors aren't bound by your agreement. Ask lenders, landlords and suppliers to release the departing partner, and replace any personal guarantees they gave.
Get the partnership's accounts made up to the closing date — they make the price and any profit share easier to agree.
Tell your bank, tax authority, business registry and any licensing body about the change of partners; the agreement commits both of you to doing so.
Each partner should take independent legal and tax advice — the tax effect of selling a partnership interest varies a lot between countries.

Sign It Online In Minutes

Fill in the blanks. Names, dates and amounts go straight into the agreement — the preview shows exactly where.
Name who signs. Tick “This is me” for your own part. VergeHR builds the PDF with every signature, date and initials box on the right line, and you can check or move anything before sending.
Send it. Each signer gets a secure link and signs from any device — no account needed. The signed PDF, with an audit trail and a Certificate of Completion, is filed in Files and emailed to everyone.

Use the partner buyout agreement Template — It’s Free

Partner buyout agreement: frequently asked questions

What happens to the partnership's debts when a partner is bought out?

Under this template the buying partner takes on all partnership debts and indemnifies the departing partner, except any you list. But the agreement only binds the partners: a creditor may still be able to pursue the departing partner unless it agrees to release them, which is why the template commits the buying partner to seek those releases.

Can the price be paid in instalments?

Yes. Enter the amount paid on the closing date and the schedule for the rest, with optional interest. If an instalment is still unpaid 14 days after written notice, the whole balance becomes due.

Does this template include a non-compete?

No. It includes an optional promise not to solicit the partnership's clients or staff for a period you choose. Whether and how far such promises can be enforced depends on local law.

Can a partner buyout agreement be signed electronically?

In most countries, including the US (ESIGN Act and UETA), the UK, the EU (eIDAS) and Canada, electronic signatures are generally valid for ordinary business contracts like this. If the buyout includes land or buildings, the transfer of the property itself may need a separate deed with wet-ink or witnessed signatures.