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Profit Sharing Agreement
Free profit sharing agreement template — a business shares a defined percentage of profits with employees, partners, or another party.
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This free profit sharing agreement covers 1. Profit Share, 2. Calculation of Profit, 3. Distribution Schedule, 4. Individual Allocation (if multiple participants), 5. Access to Financials with 10 clearly marked [placeholder] fields to fill in — built for small businesses and individuals documenting a loan or expense putting financial terms in writing so both sides have a clear, shared record. Copy it into your own word processor, fill in the placeholders, and review it — or adapt it — before use. It's part of docstoc's free document template library, alongside business, legal, real estate, finance, and HR templates. Every template here is free to copy with no signup required, and each one carries a plain disclaimer: this is a starting point for informational purposes, not a substitute for advice from a licensed professional in your jurisdiction.
Profit Sharing Agreement
Company: [Company Name] · Participant(s): [Name(s)] · Date: [Date]
1. Profit Share
Company agrees to share [%] of [net profit / a defined profit pool, e.g. profit from a specific project or division] with Participant(s), calculated as described below.
2. Calculation of Profit
"Profit" is defined as: [Gross revenue, less specified deductible expenses — be specific about what is and isn't deducted, e.g. "cost of goods sold, direct labor, and marketing spend directly attributable to this line of business," excluding [overhead allocations, owner's draw, etc.]].
3. Distribution Schedule
Profit share is calculated and distributed [Frequency — quarterly, annually], within [Number] days after the period's financials are finalized.
4. Individual Allocation (if multiple participants)
Among participants, the profit share is allocated as: [Name]: [%], [Name]: [%], or per [formula, e.g. based on sales generated].
5. Access to Financials
Participant(s) may review the underlying financial records used to calculate profit share, upon reasonable request, [subject to confidentiality].
6. No Ownership Interest
This Agreement provides Participant(s) a share of profit only and does not confer any ownership interest, equity, or governance rights in the Company.
7. Term
This Agreement runs [Term/ongoing] and may be modified only in writing signed by both parties.
Company: ______________________ Date: ____________ Participant(s): ______________________ Date: ____________
*Defining exactly what counts as "profit" (Section 2) — not just saying "profit sharing" and assuming everyone agrees on the math — is where nearly every profit-sharing dispute actually originates; be specific about which expenses are deducted before the share is calculated.*
Edit directly in the box above. Download PDF anytime — the docstoc.io footer is always included and cannot be removed.
What's included
- Edit online — click the document, fill in placeholders, download a PDF
- 7 standard sections: 1. Profit Share, 2. Calculation of Profit, 3. Distribution Schedule, 4. Individual Allocation (if multiple participants), 5. Access to Financials, 6. No Ownership Interest, …
- 10 clearly marked [placeholder] fields for quick personalizing
- Free to use — no account or signup required
- Fully editable — adjust any clause to match your actual situation
- Includes a signature block, ready to print or sign digitally
- Fixed docstoc.io footer on every PDF (not removable)
Who this template is for
Freelancers & solo founders
Handling routine business paperwork without commissioning custom legal drafting for every document.
Small businesses
Standardizing recurring documents — leases, agreements, notices — across a growing operation.
Anyone reviewing before signing
Using a clear starting structure to understand what a document should cover, even if a lawyer finalizes it.
Informal lending & reimbursements
Money changing hands between people or a business and its team, without a bank's paperwork.
FAQ
Is this profit sharing agreement template really free?
Yes. Like every template in docstoc's library, this profit sharing agreement is free to use, with no account or signup needed to view, edit, or download it.
What does this profit sharing agreement cover?
This finance template includes 1. Profit Share, 2. Calculation of Profit, 3. Distribution Schedule, 4. Individual Allocation (if multiple participants). Fill in the [bracketed] placeholders, edit any clause online, then download a PDF — the docstoc.io footer stays on every export.
Is this legal advice?
No. This covers the standard structure, not the interest-rate limits, disclosure requirements, or tax implications that can apply depending on your state and the amount involved. Check those specifics with an accountant or financial attorney before you rely on it.
Can I edit the wording?
Yes. All 10 placeholder fields and every clause are editable right on the page — change what doesn't fit, then download an updated PDF anytime.
Where can I find more free templates like this?
Browse more free finance and related document templates in the docstoc library at /document-templates/.
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