Preschool and Nursery Partnership Agreement

What a good one includes

• Clearly state the initial financial and physical assets each partner is contributing to the nursery and how this translates to ownership percentages.
• Define who manages daily childcare operations, curriculum planning, regulatory compliance, hiring, and financial administration to prevent overlapping authority.
• Establish a clear voting system for major business choices, such as physical relocation, taking on business debt, or changing the center's core educational philosophy.
• Specify how and when profits will be distributed to partners and how any financial losses or unexpected licensing expenses will be shared.
• Detail a step-by-step process for resolving internal disagreements and include a fair buy-sell clause should a partner decide to leave the preschool.
• Assign the ultimate responsibility for maintaining local, state, and national childcare licenses, inspections, and health safety standards.

Common mistakes to avoid

• Partners often overlook who has the final say in educational programming and daily teacher management, leading to conflicting messages for staff.
• Without a pre-negotiated buyout clause, a partner wishing to retire or pursue other opportunities can paralyze the nursery's operations or force a costly legal dissolution.
• Childcare carries high legal and safety responsibilities, and failing to explicitly assign regulatory compliance duties can leave both partners vulnerable during an inspection failure.
• A standard corporate partnership agreement lacks the specific clauses required for staff-to-child ratios, background checks, and early childhood education compliance.

Frequently asked questions