---
title: "What Is Signing?"
term: "Signing"
description: "Signing is the moment parties execute transaction documents — term sheet, purchase agreement, or fund commitment — creating binding obligations subject to agreed conditions before closing."
date: 2026-07-25T00:00:00.000Z
updated: 2026-07-25T00:00:00.000Z
topics: ["venture-capital"]
source: https://venturecapitaltracker.com/glossary/signing
---

# What Is Signing?

> Signing is the moment parties execute transaction documents — term sheet, purchase agreement, or fund commitment — creating binding obligations subject to agreed conditions before closing.

**Signing** marks execution of deal documents — the legal commitment to transact — which may still require days or weeks before **closing** completes.

## How it works

In a venture round, parties sign stock purchase agreements, amended charter, and ancillary docs. Funds may wire at signing if conditions are minimal, or hold cash in escrow until closing. M&A often announces "signed" deals with a later closing date pending antitrust, shareholder votes, or third-party consents.

Signing without closing risk appears when buyers walk after material adverse changes or failed conditions — break-up fees may apply in larger transactions.

Term sheets may be binding on exclusivity and fees even before full docs sign. Distinction matters for press and employee communication.

## Why it matters

- **Founders:** Do not spend cash or promise hires based on signing alone until you know closing certainty and wire timing.
- **Investors:** Signed-but-not-closed deals sit in pipeline reporting; LPs care about fall-through rates and condition risk.

## Common mistake

Announcing "we closed our round" at signing when funds have not wired and charter amendments are not yet filed — employees and vendors may assume immediate liquidity.

## Related ideas

- [Signing vs Closing](/glossary/signing-vs-closing)
- [Break-up fee](/glossary/break-up-fee)
- Conditions precedent in SPAs

## FAQ

### What is Signing in simple terms?

Signing means you have put ink on the deal papers — or e-signed — committing to the transaction if closing conditions are met. It is not always the same day money hits the bank.

### Why does Signing matter?

Signing locks economics and timelines; breaking signed deals can trigger fees or reputational damage. Founders should know what still must happen before closing — diligence, approvals, regulatory clearances.


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Source: https://venturecapitaltracker.com/glossary/signing