Joint Venture Agreement

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Joint Venture Agreement Powered By Docstoc
					This Joint Venture Agreement is used when two or more individuals or business entities
combine or collaborate on a particular project or undertaking. It specifies that each
party has an equal interest in the joint venture and sets forth each party's rights and
responsibilities. Details relating to administration and operation, termination and an
dispute resolution are also included in the agreement. This document in its draft form
contains many of the standard provisions commonly found in a joint venture agreement
and may be customized to fit the needs of the contracting parties. This agreement
should be used when individuals or companies collaborate to form a joint venture.
                         JOINT VENTURE AGREEMENT
JOINT VENTURE AGREEMENT made this _______ day of __________, 20___, between
______________________ (“Venturer A”) and _____________________ (“Venturer B”);

1. RECITALS

     1.1 Venturer A and Venturer B (sometimes collectively referred to as the “Joint Venturers”
     and singularly as “Joint Venturer”) wish to enter into an exclusive joint venture agreement
     (the “Joint Venture”) for the purposes of _________________________; and

     1.2 Each of the Joint Venturers shall have an undivided equal share and interest in the Joint
     Venture (“Proportionate Share”).

NOW THEREFORE in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agrees as follows:

2.   BACKGROUND

     2.1 The Joint Venturers hereby form a joint venture for the purpose of carrying out all acts
     which are necessary or appropriate directly or indirectly to ___________________, and to
     engage in other such activity as may be considered by the Joint Venturers to be necessary or
     desirable in connection with the foregoing.

     2.2 No partnership is created by this Agreement. Nothing contained in this Agreement shall
     or shall be deemed to constitute the Joint Venturers as partners, nor as agents of the other or
     any other relationship whereby either could be held liable for any act or omission of the
     other. Neither Joint Venturer shall have any authority to act for the other or to incur any
     obligation on behalf of the other or of the Joint Venture except as specifically provided by
     this Agreement. Each Joint Venturer covenants to indemnify the other against all claims,
     losses, costs, charges, fees, expenses, damages, obligations and responsibilities incurred by a
     Joint Venturer by reason of any action or omission of the other outside the scope of the
     authority specifically provided by this Agreement.

     2.3 Except as otherwise provided in this Agreement, each Joint Venturer may independently
     engage in any business endeavor, whether or not competitive with the object of the Joint
     Venture, without consulting the other Joint Venturer and without in any way being
     accountable to the Joint Venture.

     2.4 The Joint Venture shall be carried on under the name or names as the Joint Venturers
     shall agree. Documentation, signage and advertising projects of the Joint Venture shall
     include the term “a joint venture” in describing the ownership of the project.

     2.5 The Joint Venturers shall be responsible for the liabilities and obligations of the Joint
     Venture in accordance with their respective Proportionate Share, except that any liability or


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   obligation incurred by one Joint Venturer without the written consent of the other or as
   otherwise provided in this Agreement shall be the sole liability or obligation of the Joint
   Venturer incurring the same, without any right to contribution from or indemnity by the other
   Joint Venturer.

   2.7 If either Joint Venturer, with the consent of the other Joint Venturer, becomes liable,
   indebted or a guarantor for moneys borrowed or other obligations incurred by the Joint
   Venture, the other Joint Venturer shall indemnify the first Joint Venturer to the extent of the
   Proportionate Share of the other Joint Venturer.

3. ADMINISTRATION AND OPERATIONAL SERVICES

   3.1 ___________________ shall, on behalf of the Joint Venture, be responsible for all
   administrative duties (the “Administration”) for the Joint Venture including all accounting,
   sales, marketing, invoicing, collections, payables and banking. Such Administration shall be
   carried out and reported to the Joint Venture on a monthly or less frequent basis, as may be
   agreed upon by the Joint Venturers.

4. ADMINISTRATION FEES AND PROFITS

   4.1 A monthly administration fee (the “Administration Fee”) to compensate _____________
   for the Administration of the Joint Venture, will be paid by the Joint Venture. This fee will
   be at a rate of _____________ ($______) Dollars per month, commencing on the date that
   the Joint Venture becomes established. The first Administration Fee payment shall be made
   on the _____ day of the second month following the establishment of the Joint Venture and
   thereafter on the _____ day of each and every month. [Appendix B sets out a listing of
   general Administration and overhead expenses.]

   4.2 After payment of all expenses related to the operation of the Joint Venture, any profits
   generated from this Joint Venture will be divided equally between Venturer A and Venturer
   B and paid out on ______________ in each year after the commencement of the Joint
   Venture.

5. OPERATIONS

    5.1 As part of its/his/her Administration duties ___________ shall do the following:

      (a) maintain reasonable and thorough written records of the Joint Venture.

      (b) upon request of ______________, ________________ shall supply copies of, or
          reasonable access to review, such supporting verification business activities of the
          Joint Venture.

      (c) permit _________________, at its expense, the right to audit the applicable books
          and records of the Joint Venture.




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   5.2 _________________, at the cost of the Joint Venture, shall maintain strict compliance
   with all applicable environmental, health or safety laws, regulations, order or approvals
   throughout the term of the Joint Venture and thereafter.

   5.3 The Joint Venture shall be responsible solely for the payment of any increases in any
   taxes in respect to the operation of the Joint Venture, if applicable.

   5.4 Neither Joint Venturer shall sell, transfer, assign, pledge, hypothecate, mortgage, or in
   any other manner encumber its interest in the Joint Venture, except as specifically provided
   in this Agreement, without the written consent of the other.

   5.5 Venturer A and Venturer B shall establish regular meetings to review and discuss all
   matters relevant to the operation of the Joint Venture. On an annual basis, or at such other
   intervals as may be necessary, ________________ and _________________ will develop a
   business plan for the operation of the Joint Venture, which will be used by the Joint Venture
   as a guide for the operation thereof.

6. TERM AND DETERMINATION

   6.1 The Term of this Agreement shall commence on the date of execution and end on the
   earlier of (a) _____________ (____) [days/months/years] from the date that Joint Venture
   operations commence, or (b) the date of termination as may be established pursuant to
   paragraph 6.2 below.

   6.2 At any time during the Joint Venture, if it is reasonably determined (“Determination
   Date”) that it is no longer commercially feasible according to the general standards of the
   industry, to profitably continue the Joint Venture, then either Venturer may terminate the
   Joint Venture upon reasonable notice to the other, and Venturer A or Venturer B shall
   comply with the following conditions in a timely manner prior to the effective date of
   termination:

         (a) The Joint Venture shall make all payments due under the Agreement up to and
             including the Determination Date; and

         (b) Venturer A and Venturer B shall comply with all other terms and conditions of the
             Agreement up to the Determination Date.

7. DISPUTE RESOLUTION

   7.1

         (a)    If the Joint Venturers disagree about any aspect of this Agreement, or the
                performance or non-performance by the other party, they will try to resolve the
                dispute through negotiation.

         (b)    Either Venturer may give the other Party, in writing:



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              (i)     notice of the proposed reviewable aspect of this Agreement;
              (ii)    evidence supporting the proposed reviewable aspect this Agreement; and
              (iii)   any requests for information from the other necessary to determine the
                      issue.

      (c)     A request will be answered within _________ (___) days.

      (d)     After exchanging any information required by this Agreement, the Joint Venturers
              will meet personally (or through their personal representatives) to resolve the
              issues in dispute. If they come to an agreement, the Joint Venturers will sign and
              date an amending agreement before witnesses.

      (e)     If the Joint Venturers cannot agree within _________ (____) days of the request
              for disclosure they will try to resolve the issue through mediation.

      (f)     Either Venturer may determine if mediation is necessary in order to resolve an
              issue, and that Venturer shall give written notice that it intends to invoke this
              clause and the name of the mediator it wishes to use. The Joint Venturers will
              then meet with that mediator, within __________ (___) days of receipt of such
              notice, or earlier if appointments are available. The Venturer who first invokes
              this clause shall be initially responsible for any costs associated with the
              mediation, pending any agreement made by the Joint Venturers or any court
              order.

      (g)     The mediator shall discuss the disagreement with the Joint Venturers and attempt
              to work out a mutually satisfactory solution. In conducting any mediation, the
              mediator may collect such information from third parties as, in the discretion of
              the mediator, is required to assist in resolving the dispute, and the Joint Venturers
              will sign any necessary authorizations to permit this.

      (h)     If the dispute cannot be resolved by the Joint Venturers in the forgoing manner, it
              may be resolved by a court of competent jurisdiction on application of either
              Venturer or, upon mutual agreement, by an arbitration conducted in accordance
              with the arbitration laws of the applicable jurisdiction.

      (i)     If the Joint Venturers elect arbitration, the Joint Venturers will jointly select an
              arbitrator and will share equally arbitration costs. If the Joint Venturers fail to
              appoint an arbitrator, either Venturer may apply to a court having jurisdiction to
              appoint an arbitrator to determine such dispute. The decision of the arbitrator
              shall be final and binding on the Joint Venturers.

8. GENERAL

   8.1 The Joint Venturers agree to act in good faith and hereto agree to do all acts and things,
   and enter into such other documents and agreements so that all of the terms and conditions of




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   this Agreement will be carried out at all relevant times as herein required to assure
   compliance.

   8.2 All communications which may be or are required to be given by either Venturer to the
   other, shall (in the absence of any specific provision to the contrary) be in writing and or sent
   by prepaid registered mail or by facsimile transmission (provided the sender obtains evidence
   or verification of transmission receipt) to the Joint Venturers at their following respective
   addresses and fax numbers:

      To _______________at:

      _____________________

      _____________________

      Fax: (____) ___________

      To _______________ at:

      _____________________

      _____________________

      Fax: (____) ___________

   and if any such payment or communication is sent by prepaid registered mail, it shall, subject
   to the following sentence, be conclusively deemed to have been received on the third
   business day following the mailing of it and, if delivered or faxed, it shall be conclusively
   deemed to have been received at the time of delivery or transmission. Either Venturer may
   from time to time change its address by notice to the other in accordance with this Section.

   8.3 This Agreement shall inure to the benefit of and be binding upon parties hereto and their
   respective successors and assigns, and be registered on title. Any prior encumbrances shall
   specifically acknowledge this Joint Venture agreement.

   8.4 Neither Venturer shall be liable in damages or have the right to terminate this Agreement
   for any delay or default in performance hereunder if such delay or default is caused by
   conditions beyond its control including, but not limited to Acts of God, government
   restrictions, wars, insurrections and/or any other cause beyond the reasonable control of the
   party whose performance is affected.

   8.5 This Agreement may be signed in two or more identical counterparts each of which will
   be deemed to be an original and all of which together will constitute one and the same
   instrument.

   8.7 The parties hereto agree that this Agreement may be transmitted by facsimile, electronic



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   mail or such similar device and that the reproduction of signatures by facsimile, electronic
   mail or such similar device will be treated as binding as if originals and each party hereto
   undertakes to provide each and every other party hereto with a copy of the Agreement
   bearing original signatures forthwith upon demand.

   8.8 This Agreement shall be governed by and construed in accordance with the laws of the
   State of _______________ and shall be treated in all respects as a (n) _____________
   contract. The parties hereto submit to the non-exclusive jurisdiction on the courts of
   _______________ with respect to any dispute, claim or other matter arising under this
   Agreement.

IN WITNESS WHEREOF the Joint Venturers have executed this Agreement as of the day and
year first written above.



                                     (Name of Venture)



                                     (Name of Venturer)




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DOCUMENT INFO
Description: This Joint Venture Agreement is used when two or more individuals or business entities combine or collaborate on a particular project or undertaking. It specifies that each party has an equal interest in the joint venture and sets forth each party's rights and responsibilities. Details relating to administration and operation, termination and an dispute resolution are also included in the agreement. This document in its draft form contains many of the standard provisions commonly found in a joint venture agreement and may be customized to fit the needs of the contracting parties. This agreement should be used when individuals or companies collaborate to form a joint venture.
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