“A business contract is a legally binding agreement between two parties for an exchange of services that are of value.” (About.com)
A business contract is often used for buying and selling goods, selling a business, hiring or being employed as an independent contractor, partnerships and joint ventures, franchising, non-compete agreements and non-disclosure agreements.
Business contracts help prevent disputes and misunderstandings. They can be oral or written, though obviously a written contract is easier to prove. For a contract to be enforceable, it must contain specific language and elements.
To be legally binding, a contract must contain four essential elements. It must clearly contain an offer. It must also contain an acceptance. If any conditions of the original offer are changed or altered in any way, it is considered a counter offer, not an acceptance.
It must contain a consideration. A consideration is that which is given in exchange for the benefit or something of value in the offer. It must also contain the intention of legal consequences. In other words, the parties agree that the contract is legally enforceable, unless otherwise stated.
There are many state and local regulations as well as federal laws that may be relevant to your contract. A good contracts lawyer before you sign is a better idea than a good litigation lawyer after you have a dispute.
A contract is formed when one party makes an offer and that offer is accepted by another party for an exchange of some benefit or something of value by the parties, with the intention of legal enforceability if the contract is broken. No matter what each party thinks they understand, there is no substitute for reading the fine print. Know what you are signing before you sign. Consult with a qualified business contract lawyer before you sign.