What does it mean to "execute a contract"?

To "execute a contract" refers to the formal process of signing and implementing the agreement between the parties involved. This step is crucial as it signifies that all parties agree to the terms laid out in the contract and are legally bound by them. Signing the contract is typically the final step after negotiation and review have taken place, transforming the document from a proposal or draft into a legally enforceable agreement.

Executing a contract also implies that the parties intend to perform their obligations as specified, thereby initiating the contractual relationship. Upon execution, the terms of the contract become effective, and the parties are obligated to adhere to their commitments unless otherwise modified or terminated according to the contract's provisions. Thus, this option encapsulates the key legal and procedural aspects of executing contracts within the context of contract management.