What is a Joint Venture Agreement?
A Joint Venture Agreement, also known as a co-venture agreement, is used when two or more business entities or individuals enter into a temporary business relationship (joint venture) for the purpose of achieving a mutual goal.A Joint Venture Agreement sets out the terms and obligations of the members and the joint venture.
What types of joint ventures are there?
Contractual: A contractual joint venture is when two or more parties agree to collaborate on a business project, and sign an agreement that outlines the terms under which they will work together. The members continue to operate a separate business with a shared goal but with no pooling of profits or losses. Each party keeps their accounting records separate and there are no registration requirements. General Partnership: A joint venture in the form of a general partnership is when the partners agree to share in the profits and losses from the project and each party is jointly and severally liable for the obligations of the partnership. This type of joint venture is mainly used for real estate ventures and not for business endeavors related to research and/or product development.
What is included in a Joint Venture Agreement?
The following is included in a Joint Venture Agreement: Business location The type of joint venture Venture details, such as its name, address, purpose, etc. Start and end date of the joint venture Venture members and their capital contributions Member duties and obligations Meeting and voting details Management, dissolution, and assignment of interest details Non-compete, confidentiality, and dispute resolution clauses