With most businesses mandating working from home, transaction closings will confront the practical challenge of execution and delivery of documents.

Electronic signature of documents presents a convenient and safe alternative to physical “wet” signatures. Electronic signatures are statutorily valid under both the Federal and (nearly all) state law and execution can be easily accomplished through programs like DocuSign or even by signing a PDF with a stylus.

Set forth below is a brief summary of the relevant laws and considerations that are relevant when electronically executing an agreement.

• As a general principle, execution of an agreement by electronic means, whether by a lender, is as valid and enforceable as physical execution and may not be denied legal effect solely because it is in electronic form.
• In addition to certain non-transaction exceptions (such as court documents in certain jurisdictions), a minimal number of specialized agreements continue to require a physical signature (such as negotiable instruments, mortgages and wills).
• The federal Electronic Signature in Global and National Commerce Act (“E-Sign”) provides a broad definition of “electronic signature” and allows for the use of a wide range of marks made with any form of technology.
• Forty-seven states and the District of Columbia have adopted the Uniform Electronic Transactions Act (“UETA”) which includes a broad definition of “electronic signature,” similar to E-Sign and states the fundamental principle that a signature or a contract may not be denied legal effect because it is in electronic form.
• Three states have not adopted UETA: Illinois, New York and Washington, but have adopted separate electronic execution statutes that contain substantive provisions that are very similar to the UETA.
• Secured transactions governed by Article 9 of the Uniform Commercial Code, including security agreements, are excluded from the scope of certain state statutes, including Georgia. Counsel should consider e-signatures of these documents separately.
• E-signatures are not “better” than wet signatures, and require the same corporate authorization, lender diligence and legal assumptions in opinions that apply to physical signatures.
• The Federal and state statutes contemplate that the parties to a business transaction agree to use E- signatures. Although that agreement may be implicit, we recommend that the underlying documents expressly authorize the use of E-signatures.